Technology spend in Australia is forecast to total $93.7 billion this year, a 3 per cent increase from 2018. The growth will continue, with the figure expected to hit $98 billion by 2020, an increase of 4.6 per cent.
The figures are contained in Gartner’s global IT spending data, which was released During the Gartner IT Symposium in the US overnight.
Despite the growth in Australia, the global spending only had an incremental increase with it projected to total US$3.7 trillion in 2019, an increase of 0.4 per cent from 2018.
For 2020, spending in communication services, devices, IT services and software will be projected to grow from the prior year. Data centre systems is the only sector that has a small decline in spending for 2020.
Gartner said this is the lowest forecast growth in 2019 so far. Global IT spending is expected to rebound in 2020 with forecast growth of 3.7 per cent, primarily due to enterprise software spending.
John-David Lovelock, research vice president at Gartner said, “The slowdown in IT spending in 2019 is not expected to stretch as far into 2020 despite concerns over a recession and companies cutting back on discretionary IT spending.
“Today’s complex geopolitical environment has pushed regulatory compliance to the top of organisations’ priority list. Overall spending on security increased 10.5 per cent in 2019, with cloud security projected to grow 41.2 per cent over the next five years.
“This is not just about keeping the ‘bad guys’ out, it is also about the expanding need to be compliant with tariffs and trade policy, intellectual property rights, and even with the multiple and sometimes overlapping privacy laws,” Lovelock said.
The device market will see the sharpest spending decline among all segments in 2019, down 5.3 per cent from US$713 billion in 2018.
However, the market is expected to see modest growth of 1.2 per cent in 2020.
“Similar to how consumers have reached a threshold for upgrading to new technology and applications, technology general managers and product managers should invest only in the next generation of products that will push them closer to becoming a true technology company,” Lovelock explained.