Worldwide IT spending is expected to achieve 4.4 percent growth in constant currency to $3.25 trillion in 2023. This is slightly down from 4.5 percent in the previous month’s forecast and represents a swing from a 6 percent growth forecast in October 2022, IDC report said.
“Since the fourth quarter of last year, we have seen clear and measurable signs of a moderate pullback in some areas of IT spending,” said Stephen Minton, vice president in IDC’s Data & Analytics research group. “Tech spending remains resilient compared to historical economic downturns and other types of business spending, but rising interest rates are now impacting capital spending.”
IDC has scaled back its expectations for some hardware categories including servers, wearable devices, and peripherals – in addition to reductions to PC forecasts a month ago.
IDC has lowered forecasts for on-premise infrastructure investments by enterprise buyers, while cloud and service provider deployments remain more resilient overall.
Service provider spending is still weakening from last year’s highs as the industry adjusts to slower post-COVID growth, but planned investments by cloud and hyperscale providers have broadly held up since last month. Strong demand for cloud services continues to drive growth despite inflationary pressures but non-cloud spending is set to decline.
Consumer IT spending forecast to decline by 2 percent this year. This will be a second consecutive year of declining consumer tech spending, a huge change in fortunes from consumer growth of 18 percent in 2021.
Enterprise demand for cloud and digital transformation remains strong despite economic headwinds.
While direct IT spending is expected to grow by 6.4 percent overall in 2023, indirect spending through channel providers will increase by just 2.5 percent as credit tightening affects smaller businesses and consumers in their ability to fund technology investments.
Resellers that derive much of their revenue from on-premise infrastructure and PCs are facing difficult market conditions this year. Meanwhile, cloud infrastructure, software, and services are growing more slowly but continue to account for a larger share of total IT spending.
