March 5, 2024
Business Tech

Gartner: Global IT spending is poised to click $5 trillion in 2024

IT services to outpace communications services

Worldwide IT spending is poised to reach $5 trillion (6.% growth) in 2024 according to the latest Gartner tech industry forecast. Although this projection marks a slight decrease from the previous quarter’s forecast of 8% growth, it still highlights a positive trajectory for the tech industry.

Notably, IT services are set to outpace communications services spending for the first time in 2024, becoming the largest segment of IT spending.

The shift is attributed to a robust 8.7% growth in IT services, totalling $1.5 trillion. Enterprises increasingly invest in organisational efficiency and optimisation projects, particularly crucial during times of economic uncertainty.

GenAI role

John-David Lovelock, Distinguished VP Analyst at Gartner, emphasised that while generative AI (GenAI) had significant hype in 2023, it will not significantly impact IT spending in the near term.

Gartner
Acronis pavilion at GITEX Global 2022. The tech sector will be on positive ground in 2024. Image: Arnold Pinto

He stated: “2024 will be the year organisations invest in planning for how to use GenAI; however, IT spending will be driven by more traditional forces, such as profitability and labour, and dragged down by a continued wave of change fatigue.”

Worldwide IT spending forecast for 2024 (Millions of $)

Category2023 spending2023 growth (%)2024 spending2024 growth (%)
Data centre systems243,0637.1261,3327.5
Devices699,791-8.7732,2874.6
Software913,33412.41,029,42112.7
IT services1,381,8325.81,501,3658.7
Communications services1,440,8271.51,473,3142.3
Overall IT4,678,8473.34,997,7186.8
Source: Gartner

Lovelock explained that consumer spending on devices and communications services plateaued over a decade ago, leaving room for only incremental growth. Consequently, IT services have surpassed these segments due to enterprises finding more uses for technology, making IT a revenue-producing function.

Despite the expected momentum in 2024, CIOs’ change fatigue remains a factor impacting IT spending. The growth rate for overall IT spending in 2023 was only 3.3%, a mere 0.3% increase from 2022. However, Gartner anticipates a resurgence in momentum with an overall IT spending increase of 6.8% in 2024.

Change fatigue among CIOs manifests as resistance to new contracts and long-term initiatives. Gartner’s IT spending forecast relies on rigorous sales analysis by over a thousand vendors, providing a unique perspective on market opportunities and challenges for clients in the tech industry.

Featured image: There is a robust 8.7% growth in the IT services segment. Image: RAEng

    Arnold Pinto

    Arnold Pinto

    Arnold Pinto is an award-winning journalist with wide-ranging Middle East and Asia experience in the tech, space, aerospace, aviation, defence, luxury watchmaking, business, fashion, and automotive verticals. He is passionate about conserving endangered native wildlife globally and protecting the world’s oceans from plastic pollution, overfishing, and climate change. Arnold enjoys 4x4 off-roading, camping and exploring global destinations off the beaten track.
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