What CIOs need to learn from ICT spending forecast for 2018

VR headset user
Spending on telecom and IT will be touching nearly $4 trillion in 2018, said IDC, indicating enterprise CIOs will be under pressure in selecting the latest technology including digital transformation.

IDC report indicates that only very large enterprises will be spending heavily on digital needs to enhance business efficiency.

The small office category with businesses with 1-9 employees will account for 7 percent all ICT spending. The small office category will be spending around $100 billion per year on fixed and mobile telecom services, and devices.

Very large businesses with more than 1,000 employees will account for more than 50 percent of all ICT spending — focusing on IT outsourcing, project-oriented outsourcing, applications, and infrastructure in order to pursue their digital transformation strategy to improve business efficiency.

The report indicates that CIOs of medium enterprises with 100-499 employees and large enterprises with 500-999 employees will have to take more balanced spending approach across all technology categories.

Consumer spending on smartphones will account for the largest proportion of ICT spending this year. The growth driver for ICT spending will be enterprise spending on cloud, software and infrastructure, according to IDC.

The consumer ICT spending will be more than $1.5 trillion in 2018. Consumer spending will experience the slowest growth over the forecast period with a CAGR of 1.2 percent. Consumers will earmark 80 percent of their annual spending on devices and mobile telecom services.

Industries such as banking, discrete manufacturing, telecommunications, and professional services will be spending more than $900 billion, making it the four largest industries for ICT spending in 2018.

ICT spending geographically

United States $1.3 trillion
China $499 billion

Banking, discrete manufacturing, telecommunications, and professional services will invest heavily in applications, infrastructure, outsourcing, and telecom services this year. Banking sector will be spending nearly $115 billion in IT outsourcing and project-oriented outsourcing.

Telecommunications industry will be spending $85 billion in infrastructure.

Professional services and banking will experience the fastest growth in ICT spending with five-year CAGRs or 5.9 percent and 5.2 percent, respectively.

“Facebook, Google, Microsoft, and Uber, among others, embrace technology as a key enabler to their business strategies and service offerings. They are the first to test drive new innovations as they strive to stay ahead of the rapidly evolving technology market,” Jessica Goepfert, program director, Customer Insights & Analysis, said.

IT spending will be $2.16 trillion this year, driven by business and consumer spending on devices, applications, IT outsourcing, and project-oriented outsourcing, including application development and system and network implementation.

Spending on business process outsourcing and business consulting services will be more than $300 billion this year.

Telecommunications spending will be $1.5 trillion this year with 95 percent of the total going to fixed and mobile telecom services.

Mobile phones will be the largest segment of technology spending at nearly $500 billion in 2018, followed by mobile data and mobile voice at more than $400 billion each.

Consumes will be dominating the spending on telecom services. IDC said some industries have emerged as rapid adopters of fixed and mobile data services over the past few years. In Asia, special projects and initiatives have helped to boost fixed broadband adoption in the education sector.

In the U.S., the healthcare industry is a major source of fixed-line telecom spending, while transportation firms in Canada and Japan have invested aggressively in mobile broadband solutions.

“Consumers in many emerging markets continue to leapfrog fixed broadband and go straight to mobile data services, which is changing the entire landscape for how to connect with end-users in these countries,” said Stephen Minton, research vice president, Customer Insights & Analysis.

Related News

Latest News

Latest News