Aussie IT spend to increase in 2019, despite recession rumours and trade war turmoil

Australia’s IT spend will increase this year to $93.3 billion, according to Gartner forecasts.

That represents a 3.4 per cent increase on the amount spent on technology products and services in 2018.

The outlay on data centre systems, software, communications and services will all increase, while device spend is predicted to decrease slightly.

The total spend is on track to exceed $97 billion in 2020, Gartner said in its quarterly forecast update today.

The story is similar for New Zealand where spending is expected to reach NZ$13.5 billion this year, an increase of 2.6 per cent from 2018, and reach NZ$13.9 billion in 2020.

The predicted increase in IT spend in ANZ is similar globally. Worldwide IT spending is projected to total US$3.76 trillion in 2019, an increase of 3.2 per cent from 2018.

The figures indicate global IT spend continues to bounce back after suffering a six per cent decline on the previous year in 2015 and 0.5 per cent decline in 2016. The turnaround came in 2017 when growth was 2.7 per cent on the previous year. In 2018 worldwide IT spend when it rose 4.5 per cent on the previous year to US$3.7 trillion. 

In Australia, IT spend has risen year on year since 2016 when it totalled $84 billion.

“Despite uncertainty fuelled by recession rumours, Brexit, and trade wars and tariffs, the likely scenario for IT spending in 2019 is growth,” said John-David Lovelock, research vice president at Gartner.

“However, there are a lot of dynamic changes happening in regards to which segments will be driving growth in the future. Spending is moving from saturated segments such as mobile phones, PCs and on-premises data centre infrastructure to cloud services and Internet of Things devices. IoT devices, in particular, are starting to pick up the slack from devices. Where the devices segment is saturated, IoT is not,” Lovelock added.

The segment with the biggest expected growth between now and 2020 is enterprise software, with much of companies’ budget shifting to software-as-a-service offerings.

The most sluggish growth – less than two per cent – is predicted in the devices and communications services segments.