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IT spending up 3.1 percent in 2014, says Gartner

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Enterprise software and IT services will be the main targets for IT spending in 2014, closely followed by devices, says new research from IT market research firm, Gartner.

Overall, worldwide IT spending is set to rise 3.1 percent in 2014, to reach $3.8 trillion. Gartner analysts have downgraded their previous estimate of 3.6 percent growth over the course of the year, to reflect more muted expectations when it comes to spending on telecom services. That’s down to “faster-than-expected growth of wireless-only households, declining voice rates in China and a more frugal usage pattern among European customers,” said Gartner analyst Richard Gordon.

In enterprise software, spending is forecast to grow 6.8 percent to $320 billion, with the strongest growth areas expected to be customer relationship management (CRM) and supply chain management (SCM).

“Investment is coming from exploiting analytics to make B2C [business-to-customer] processes more efficient and improve customer market efforts. Investment will also be aligned to B2B [business-to-business] analytics, particularly in the SCM space, where annual spending is expected to grow 10.6 percent in 2013,” said Gordon. “The focus is on enhancing the customer experience throughout the pre-sales, sales and post-sales processes,” he explained.

Spending on IT services, meanwhile, will grow 4.5 percent to $963 billion. Here, Gartner expects to see reductions in IT outsourcing - and specifically, co-location, hosting and data centre outsourcing growth rates.

“We are seeing CIOs increasingly reconsidering data centre build-out and instead planning faster-than-expected moves to cloud computing,” Gordon commented. “Despite these small reductions, we continue to anticipate consistent four to five percent annual growth through 2017.”

Spending on devices - including PCs, mobile phones and tablets - will grow 4.3 percent in 2014, according to Gartner’s forecast. Convergence of devices will hurt profit margins for manufacturers and purchase decisions will increasingly be based more on price than on suitability for a specific task, the warn.

Finally, data centre systems spending will grow 2.6 percent to $143 billion. That’s down from the firm’s previous forecast of 2.9 percent - but Gartner now expects storage and enterprise communications spending to come in lower than expected and these two segments, they say, make up around one-third of all data centre systems spending.