IT spending to grow 1.4% to $3.5 trillion in 2017: Gartner

IT Spending Forecast for 2017
Market research agency Gartner predicts that IT spending will grow 1.4 percent to $3.5 trillion in 2017.

Earlier, Gartner predicted 2.7 percent growth in IT spending from 2016. The fall in the global IT spending growth is due in part to the rising U.S. dollar.

“The strong U.S. dollar has cut $67 billion out of our 2017 IT spending forecast,” said John-David Lovelock, research vice president at Gartner. “We expect these currency headwinds to be a drag on earnings of U.S.-based multinational IT vendors through 2017.”

Cisco Systems, IBM, Oracle, HP, HPE, Microsoft, Juniper, Google, Amazon Web Services, Apple, Dell and Intel are some of the leading technology companies based in the US and rely on IT spending for their revenue growth.

Gartner said the global data center system segment is expected to grow 0.3 percent in 2017 against negative growth in 2016. The segment is experiencing a slowdown in the server market.

Enterprises are moving away from buying servers from the traditional vendors and instead renting server power in the cloud from companies such as Amazon, Google and Microsoft. This has created a reduction in spending on servers which is impacting the overall data center system segment.

Spending on devices including PCs, tablets, ultra-mobiles and mobile phones is projected to grow 1.7 percent to $645 billion against 2.6 percent drop in 2016.

Spending on mobile phone will be driven by increased average selling prices (ASPs) for phones in emerging Asia Pacific and China, together with iPhone replacements and the 10th anniversary of the iPhone.

The tablet market will decline significantly, as replacement cycles remain extended and both sales and ownership of desktop PCs and laptops are negative.

IT services market will grow 2.3 percent in 2017 against 3.6 percent growth in 2016.