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2017 IT spend projected to remain on growth trajectory

2017 IT spend projected to remain on growth trajectory

IT research and advisory firm Gartner's latest forecast that worldwide IT spending in 2017 would increase by 2.7% from 2016 to total US$3.5 trillion in 2017 is another positive outlook for the industry going into the new year - this despite a 0.3% shortfall in expected growth after Gartner originally predicted 3% for 2017.

John-David Lovelock, research vice president at Gartner emphasises that while there will be growth in spending over the coming months, this had been expected to be much stronger.

"2017 was poised to be a rebound year in IT spending. Some major trends have converged, including cloud, blockchain, digital business and artificial intelligence. Normally, this would have pushed IT spending much higher than 2.7 percent growth, however, some of the political uncertainty in global markets has fostered a wait-and-see approach causing many enterprises to forestall IT investments."

Gartner anticipates that global devices spending (PCs, tablets, ultramobiles and mobile phones) will remain flat in 2017 at US$589 billion. Emerging markets, of which Africa is one, will drive the replacement cycle for mobile phones as smartphones in these markets are used as a main computing device and replaced more regularly than in mature markets according to Gartner.

"The worldwide IT services market is forecast to grow 4.2 percent in 2017. Buyer investments in digital business, intelligent automation, and services optimisation and innovation continue to drive growth in the market, but buyer caution, fueled by broad economic challenges, remains a counter-balance to faster growth," noted Gartner in the announcement of its estimates.

Sustenance of growth by African region

The growth projections by Gartner for 2017 follow recent findings by the IDC of an improved performance by the Europe, the Middle East and Africa in the PC market during the fourth quarter of 2016, despite a worldwide year-on-year decline of 1.5%.

The IDC's Worldwide Quarterly Personal Computing Device Tracker report, issued a day before Gartner's projections, found that growth in volume had stabilised in Africa in the last quarter of 2016.

"The EMEA market performed better than expected, fueled by strong holiday season sales of traditional PCs. While desktops performed in line with IDC's expectations, notebooks grew above forecast across the region. However, component shortages are expected to have driven some of the vendor's shipment towards inventory build-up," stated the report.

Loren Loverde, vice president, Personal Computing Trackers & Forecasting says the fourth quarter results reinforce the IDC's expectations for market stabilisation, and even some recovery. "The contraction in traditional PC shipments experienced over the past five years finally appears to be giving way as users move to update systems. We have a good opportunity for traditional PC growth in commercial markets, while the consumer segment should also improve as it feels less pressure from slowing phone and tablet markets."

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