Gartner massages IT spend predictions upwards

Market watcher Gartner has revised its growth figures for IT spending in 2011, and the news is good: rather than the previously estimated 3.5 per cent growth, the company now predicts a more impressive 5.1 per cent increase.

Sadly, while the figures represent a significant improvement on the company's previous best guess of 3.5 per cent year-on-year growth, it still represents a slight slowdown from the 5.4 per cent growth experienced in 2010.

The company's forecast, which attempts to estimate the overall global spend on IT products and services, predicts that a total of £2.32 trillion will be spent throughout 2011 - an increase from its original predictions largely helped by the poor performance of the dollar against other global currencies, leading to favourable exchange rates and increased exports.

The biggest areas for growth are expected to be computing hardware and enterprise software, which Gartner's latest forecast has pegged as growing at 7.5 per cent each, while sales of telecommunications equipment is expected to reach 9.1 per cent - a significant drop from the 14 per cent growth that market experienced in 2010.

Telecommunications services, including voice, data, and VoIP provision, will continue to be the single largest area that companies drop their money on, with an estimated global spend of over £1 trillion in 2011 - a growth rate of 3.4 per cent year on year.

Richard Gordon, Gartner's vice president of research, explained the slowing growth: "While the global economic situation is improving, the recovery is slow and hampered by a sluggish growth outlook in the important mature economies of the U.S. and Western Europe.

"Nevertheless, as well as a fundamental enabler of cost reduction and cost optimization, investment in IT is seen increasingly as an important element in business growth strategies. As the global economy repairs itself in coming years, we are optimistic about continued healthy spending on IT."

We'll revisit Gartner's figures at the end of the year, and see just how close its revised prediction was to reality.