Irish IT spending is set to return to growth this year, following a 2pc decline in 2011, according to new research from IDC. Globally, the market watcher forecasts technology spending will grow by 6pc to US$2.1trn in 2012.
The growth in Ireland this year is almost entirely due to smartphones and tablets. Excluding mobile devices, IT spending in Ireland would be flat, said Stephen Minton, vice-president in IDC’s Global Technology and Industry Research Organisation.
“It wasn’t hard to improve on a weak market last year – especially the PC market, which plunged by 8.5pc in 2011,” Minton told Siliconrepublic.com.
“So, Ireland is weaker than most countries – and weaker than the European average – but the bright spots are smartphones and tablets. We don’t expect a meaningful recovery [growth of more than 2pc] in the overall Ireland IT market until 2014,” Minton added.
Globally, the 6pc figure is only marginally down from the 2011 rate of 7pc. The growth comes despite ongoing uncertainty about the worldwide economy, which is affecting investment in some technology areas. Both figures are measured in constant currency; in US dollar terms, the growth in 2012 would be 4pc. This dovetails with earlier forecasts from rival analyst Gartner, which pegged worldwide IT spending at 3pc growth.
IDC said the categories performing most strongly are software, storage, enterprise network and mobile devices – improving the overall picture where segments such as PCs, servers, peripherals and telecoms provider equipment have shown weaker growth.
The figures come from IDC’s Worldwide Black Book Query Tool, Version 2, 2012.
Minton said the worldwide growth figure isn’t especially high by historical standards, but is “quite good” in the context of the sluggish economy. “It suggests that businesses and consumers are still trying to invest in technology as much as possible, and are placing a higher priority on technology than other spending areas.”
IT spending is growing more quickly than most other areas of business and consumer spending, and is still growing faster than the overall economy, Minton said.
Worldwide IT market trends
Other notable trends in the worldwide IT market so far in 2012 include a weaker performance in US IT spending than in 2011 with growth of 5.9pc, compared with 8.5pc growth in 2011. IDC said the launch of Windows 8 later this year should help to drive a meaningful recovery in the PC market into 2013.
Western Europe remains weak overall due to the slow economy, but software and services growth in Northern Europe was robust, and mobile device shipments remain on course. As in Ireland, without smartphones and tablets the picture is much less rosy with just 1pc growth in constant currency. Measured in US dollars, this would represent a 4.5pc decline.
“The biggest surprise is probably that IT spending has held up as well as it has in Europe, given the economic crisis here,” said Minton. “Mobile devices are still flying off the shelves in all of Europe. Consumers are still eager to buy the latest smartphones and tablets, even while they’re cutting back on other spending areas.”
IT spending image via Shutterstock