Worldwide IT spending plummets $216bn

Last year saw $214 billion less spent on IT services compared to 2014, and it won’t be until 2019 that 2014’s IT spending levels are surpassed again.

These figures are from research house Gartner’s annual worldwide IT spending report, which says the 2015 drop was the largest ever slump Gartner has witnessed since it started tracking IT spending.

The fall was partially blamed on the rising US dollar. “US multinationals’ revenue faced currency headwinds in 2015,” said John-David Lovelock, research vice president at Gartner. “The rising US dollar is the villain behind 2015 results.”

Data centre systems was the only sector to actually experience growth in spending last year, according to the report, rising 1.8 percent. This growth will continue, with data centre systems spending projected to reach $75bn in 2016, a 3 percent increase from 2015.

Worldwide IT spending is forecast to hit $3.54 trillion in 2016, just a 0.6 percent increase over 2015 spending of $3.52 trillion.

The devices market, which includes smartphones, tablets, and PCs, is forecast to fall 1.9 percent this year. Gartner said that this is part due to the economic conditions stopping countries like Russia and Japan from returning to stronger growth, along with emerging markets shifting to cheaper phones.

IT services market spending is expected to return to growth this year, after suffering a decline of 4.5 percent in 2015. IT services spending is forecast to reach $940bn in 2016, up 3.1 percent from 2015. This is thanks to an “accelerating momentum” in cloud infrastructure adoption, said Gartner.

The telecom services sector is expected to decline 1.2 percent this year, however, with spending to reach $1.45trn. Gartner is expecting impact from the abolition of roaming charges in the EU and certain parts of North America. “While this will increase mobile voice and data traffic, it will not be enough to counter the corresponding loss of revenue from lost roaming charges and premiums,” said Gartner.