Growth in worldwide IT spend to return this year

Growth through weakness

Market researcher Gartner has forecast overall growth in global IT spend of 4.6 percent for 2010, with the market having shrunk by the same percentage last year. The total amount spent on all IT and telco kit and services is expected to be in the region of $3.4 trillion.

This represents a return to 2008 levels of spending a year earlier than Gartner had previously forecast, with a predicted weakening of the US dollar being the primary reason for this upward revision as it lowers the price of products paid for in dollars.

"Last quarter, we did not expect to see IT spending levels recover to 2008 levels until 2011, however, now, with the upward revision to the current dollar forecast, we are projecting that global IT spending this year will approach the level seen in 2008," said Richard Gordon, research VP at Gartner.

"While this forecast might seem bullish at first, it's important to factor in the impact that exchange rates will have on the markets. Much of the increase in our revised 2010 forecast can be attributed to a projected decline in the value of the U.S. dollar compared to 2009."

The table below shows the breakdown across broad market sectors. In this period of ever-greater convergence between the computing and telco markets, it serves as a timely reminder of quite how big the telco sector is, although it should be noted that the services figure is in fact a subset of the telco total.

Table 1

Worldwide IT Spending Forecast (Billions of U.S. Dollars)

Source: Gartner (January 2010)