The world’s spending $30bn less on new devices in 2019, $38bn more on enterprise software

Although global IT spend for 2019 is set to increase ever so slightly, the world is even more reluctant to drop cash on devices, Gartner reported on Wednesday.

The global research firm, in its Q2 2019 update to its IT Spending Forecast, suggests that IT spend will top $3.74-trillion in 2019, up by 0.8% over 2018.

The biggest drivers of spend include enterprise software, seeing a growth rate of 9% over 2018. That’s a noticeable drop from 2017 to 2018’s growth figure of 13.5% though. IT services too will see an increase of 3.8% in 2019.

However, firms and individuals just don’t want to spend on new devices. According to Gartner, device expenditure will drop by 4.3% in 2019 over 2018, as the world drops some $30-billion less on devices. This is off the back of a near 6% growth rate in spend seen between 2017 and 2018.

Gartner’s research VP John-David Lovelock believes that the austerity is due to economic uncertainty over trade wars, Brexit, and “recession rumours”.

“Although an economic downturn is not the likely scenario for either 2019 or 2020, the risk is currently high enough to warrant preparation and planning,” Lovelock noted.

However, devices now also have extended lifespans when compared to older tech. Those with flagship smartphones bought a year ago are less likely to upgrade this year, for instance, as their devices are still capable of performing modern tasks. This is true for laptops and tablets, Gartner added. Lovelock believes that the devices market is now “being driven by replacements and upgrades”.

Data centres too are taking a knock. After a 15.7% growth in this sector seen between 2017 and 2018, a 3.5% drop is forecast for 2019. This, Lovelock believes, is due to increased spend on the growing influence of and reliance on cloud infrastructure in businesses.

“Spending in old technology segments, like data centre, will only continue to be dropped,” he explained.

For device, infrastructure and software vendors though, 2020 spend across all IT segments is set to pick up again by 3.7%.

Even device spend is forecast to grow by 0.8% over 2019. However, Enterprise Software is set to experience another massive spike in spend, growing 10.9% in 2020. If these forecasts are indeed correct, that’s close to a $100-billion increase in spend in this segment since 2017.

Feature image: The Nokia 7 Plus smartphone, by Andy Walker/Memeburn