Global IT Spending Expected to Rise 8.4% to $4.1 Trillion This Year
By Angus Loten
Chief information officers and other corporate technology
leaders are moving on from stopgap information technology measures
deployed during the coronavirus pandemic and eyeing more ambitious
projects, according to the latest IT spending forecast by research
and consulting firm Gartner Inc.
Companies world-wide are expected to spend $4.1 trillion on IT
this year, up 8.4% from 2020 and regaining the pace of corporate IT
growth before Covid-19 brought much of the global economy to a
standstill, Gartner said.
Many businesses are bolstering videoconferencing and
collaboration tools, which helped support remote work during the
crisis, as they lay the groundwork for a permanent shift to hybrid
offices combining physical and virtual workspaces.
Ramped up spending of more than 10% from last year on both
enterprise software and devices is expected to lead the gains,
"Our overall IT budget will look very similar to what it did
pre-pandemic," said Erik Bailey, CIO at Anaqua Inc., noting the
Boston-based software company's spending plans will focus on
cybersecurity, hosting services and laptops, monitors and other
workstation equipment. The goal is "to ensure staff are completely
productive wherever they are," he said.
At cybersecurity and network services provider Akamai
Technologies Inc., this year's IT budget includes spending on
technologies that support enhanced security, mobility and
collaboration, while "continuing our commitment to cloud migration
and other key projects," Mani Sundaram, CIO executive vice
Most businesses put large-scale technology projects on hold in
2020, as they raced to install remote collaboration and other
business-continuity tools. The shift dashed rosier forecasts made
before Covid-19 lockdowns and other restrictions were put in place.
Gartner now estimates IT spending came in last year at roughly $3.8
"Last year was about getting remote work working," said
John-David Lovelock, Gartner's chief forecaster. "Now we're
transitioning to how do you make remote work productive," among
other business-wide initiatives, he said.
That includes returning to efforts to digitize business
processes across the board and shifting them online into the cloud,
a strategy broadly referred to as digital transformation.
Cloud-based business systems and software, which can be scaled as
needed to quickly respond to unexpected changes in the market,
proved their worth during the pandemic, Mr. Lovelock said.
Companies are also preparing for the next unexpected market
disruption by adding more resilient digital capabilities, so as not
to get caught flat footed and race to install last-minute emergency
measures, Mr. Lovelock said: "They're going from building cart
paths to building a solid road."
The rebound to pre-pandemic spending levels won't spread evenly
across industries, as banking and securities and insurance
companies, which fared better during the crisis, are likely to
boost IT spending faster than retailers and travel firms, Mr.
"The spending recovery generally comes down to the industry
recovery," he said. "Some companies are not there yet."
Liberty Mutual Insurance anticipates its IT spending will
increase significantly, driven by its accelerating the core
components of its digital transformation work, said CIO James
McGlennon. That includes migrating workloads to the cloud, enabling
customer interactions across all platforms and gaining more insight
into data, he added.
"Spending has increased from 2020 as we continue to pivot to
focus on digital and data," Mr. McGlennon said.
Write to Angus Loten at firstname.lastname@example.org
(END) Dow Jones Newswires
April 07, 2021 19:37 ET (23:37 GMT)
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