Welcome!

@CloudExpo Authors: Yeshim Deniz, Liz McMillan, Elizabeth White, Pat Romanski, Zakia Bouachraoui

Related Topics: @CloudExpo, Java IoT, Microservices Expo, Containers Expo Blog, Agile Computing, SDN Journal

@CloudExpo: Blog Feed Post

Global Outlook for 2014 Business Technology Investment

Overall business technology spending is on course to increase by 4 percent this year

Are you likely to increase your business technology investment next year? If you are, then you're not alone. Worldwide ICT spending is expected to accelerate in 2014, after dipping to its slowest pace of growth since the financial crisis in 2013, according to the latest market study by International Data Corporation (IDC).

Overall business technology spending is on course to increase by 4 percent this year at constant currency, reaching $2.04 trillion -- that's down from last year’s growth of 5 percent, due mainly to the slowdown in key emerging markets including China and Russia.

IDC forecasts that in 2014, a rebound in China and continued momentum in the U.S. and Europe will see a return to overall industry growth of more than 5 percent (reaching $2.14 trillion).

The Business Technology That Will Drive Growth
In fact, almost half of this year’s industry growth is due to continued strength in smartphone and tablet shipments. Excluding mobile phones, IT spending will increase by only 2.6 percent this year at constant currency (just 0.7% in U.S. dollar terms, based on year-to-date exchange rates).

Enterprise IT spending in many regions has been tepid since last year, with weaker spending on PCs, servers and storage than previously expected. Tentative signs of stability in commercial PC shipments during Q3, however, may foreshadow the gradual recovery in enterprise infrastructure investment which IDC expects to unfold in the next 12-18 months.

Spending on servers, storage and enterprise networks will increase by just 1 percent in 2013 before accelerating to growth of 4 percent next year.


Global Business Technology Market Assessments
While the U.S. market is on course to post IT spending growth of 5 percent this year, that translates into just 3 percent excluding mobile phones. Enterprise spending in the U.S. has been relatively resilient, given the ongoing political volatility, but spending on PCs and servers will decline this year while storage investment is flat.

Both the storage and server markets in the U.S. are expected to improve in 2014, but PC spending is likely to remain weak in spite of signs of stability in Q3 as tablet cannibalization continues at lower price points.

Market conditions are gradually improving in Western Europe, where overall IT spending is on course for growth of 2 percent this year (1% excluding phones), and where economic momentum has taken a turn for the better in many countries.

IDC assumed that this gradual recovery will continue next year, translating into IT spending growth of 3 percent driven mainly by strengthening sales of commercial software. This year has also seen a moderate improvement in Japan, driven by the government’s short-term policy initiatives; while IT spending is on course to be flat in 2013 (0% growth), this marks an improvement from our previous forecast of a 1 percent decline.

IDC forecasts that IT demand will accelerate in China next year, in line with their expectation that macroeconomic growth and business confidence will improve. In China, overall IT spending is on course to increase by just 8 percent this year, the weakest pace of growth since 2008 -- next year, they forecast an acceleration of growth to 14 percent led by strengthening sales of PCs, servers, storage, software and IT services.

Growth in India will remain broadly strong, driven mainly by smartphones and tablets, but IDC expects a slowdown in PC sales after state-level government initiatives helped to drive strong growth in 2013, while there are also signs of weakening growth in other sectors.

A gradual deceleration in tech spending is also emerging in Brazil, while in Russia the economic slowdown has driven overall industry growth to just 1 percent this year (from 15% in 2012). IDC says that they forecast a rebound in Russia to 10 percent growth next year, driven by smartphones, software and services.

Read the original blog entry...

More Stories By David H Deans

David H. Deans is the Managing Director at the GeoActive Group. He has more than 25 years of experience in the Technology, Media and Telecom sectors.

CloudEXPO Stories
For enterprises to maintain business competitiveness in the digital economy, IT modernization is required. And cloud, with its on-demand, elastic and scalable principles has resoundingly been identified as the infrastructure model capable of supporting fast-changing business requirements that enterprises are challenged with, as a result of our increasingly connected world. In fact, Gartner states that by 2022, 28% of enterprise IT spending will have shifted to cloud. But enterprises still must determine which clouds are best suited for each application, in order to achieve IT governance, while accounting for complex data privacy requirements. It's safe to say that enterprises know their future looks cloudy, and that this infrastructure will soon become a mix of multi, hybrid, and on-prem enterprise clouds.
Cloud-Native thinking and Serverless Computing are now the norm in financial services, manufacturing, telco, healthcare, transportation, energy, media, entertainment, retail and other consumer industries, as well as the public sector. The widespread success of cloud computing is driving the DevOps revolution in enterprise IT. Now as never before, development teams must communicate and collaborate in a dynamic, 24/7/365 environment. There is no time to wait for long development cycles that produce software that is obsolete at launch. DevOps may be disruptive, but it is essential. DevOpsSUMMIT at CloudEXPO expands the DevOps community, enable a wide sharing of knowledge, and educate delegates and technology providers alike.
The term "digital transformation" (DX) is being used by everyone for just about any company initiative that involves technology, the web, ecommerce, software, or even customer experience. While the term has certainly turned into a buzzword with a lot of hype, the transition to a more connected, digital world is real and comes with real challenges. In his opening keynote, Four Essentials To Become DX Hero Status Now, Jonathan Hoppe, Co-Founder and CTO of Total Uptime Technologies, shared that beyond the hype, digital transformation initiatives are infusing IT budgets with critical investment for technology. This is shifting the IT organization from a cost center/center of efficiency to one that is strategic for revenue growth. CIOs are working with the new reality of cloud, mobile-first, and digital initiatives across all areas of their businesses. What's more, top IT talent wants to w...
While a hybrid cloud can ease that transition, designing and deploy that hybrid cloud still offers challenges for organizations concerned about lack of available cloud skillsets within their organization. Managed service providers offer a unique opportunity to fill those gaps and get organizations of all sizes on a hybrid cloud that meets their comfort level, while delivering enhanced benefits for cost, efficiency, agility, mobility, and elasticity.
Public clouds dominate IT conversations but the next phase of cloud evolutions are "multi" hybrid cloud environments. The winners in the cloud services industry will be those organizations that understand how to leverage these technologies as complete service solutions for specific customer verticals. In turn, both business and IT actors throughout the enterprise will need to increase their engagement with multi-cloud deployments today while planning a technology strategy that will constitute a significant part of their IT budgets in the very near future. As IoT solutions are growing rapidly, as well as security challenges growing exponentially, without a doubt, the cloud world is about to change for the better. Again.