IT spending is expected to increase by 5% during 2014 to reach $2.14 trillion, led by a rebound in China, continued momentum in US and Europe, according to a report from the International Data Corporation (IDC).
According to the report, spending is expected to rise 4% in 2013 to $2.04 trillion, a decrease in percentage points compared to the 5% increase in last year, due to the slowdown in key emerging markets including China and Russia.
The analysts expect that the increase in spending will be attributed to increase in smartphone and tablet shipments, while the IT spending excluding mobile phones is expected to rise by 2.6% in 2013.
IDC Global Technology & Industry Research Organization (GTIRO) vice president Stephen Minton said this has been a tough year for many IT vendors, with infrastructure spending in the first half of 2013 proving weaker than previously expected.
"The overall industry has been propped up by continued strength in mobile devices, especially smartphones, but the slowdown in emerging markets was another headwind for infrastructure-focused tech firms on top of government sequestration in the US and continued sluggish growth in Europe," Minton added.
Servers, storage and enterprise networks expenditure is anticipated to experience 1% growth in 2013, followed by 4% rise next year.
IT spending in US is expected to grow 5% in 2013 and the storage and server markets are expected to improve in 2014, while PC spending would decrease affected by the adoption of tablet.
"The main headwind, aside from uncertainty over the next round of political dogfighting, is cannibalization as tablets continue to eat into PC sales and as the Cloud eats into traditional IT services revenues."
"This cannibalisation trend is seen across all geographies, and will be a constraint on IT spending even while the macroeconomic environment improves."
The report anticipates Western Europe to increase its IT spend and Japan is expected to remain constant for 2013, while China is expected report 8% growth in 2013 and continue it to 2014 with 14% rise riding over the strong sales in PCs, servers and storage segments.
"In recent years, growth in emerging markets has been a ‘pot of gold’ for many global IT suppliers, as they capitalized on huge opportunities to expand into new territories even while growth in developed economies was anemic."
"This year has been a different story, with some organizations stung by the large bets they placed on a continuation of those growth trends."
"It’s important to remember that growth in emerging markets will continue to outpace the US, Europe and Japan, in spite of these bumps in the road, and that any retreat from those geographies will only be to the benefit of emerging competitors from China and elsewhere with global ambitions of their own."
