The analyst firm Gartner reports that global IT spending will drop 7.3% this year, with Covid-19 and the lockdown hitting the economy hard. Their predictions state that IT spending this year will peak at $3.5 trillion, with all sectors facing a decline.
The hardest-hit market will be the device segment due to cost reduction measures by the consumer and business market. The pandemic is going to keep things in lockdown for a while. Because of the work-from-home policy instituted by many companies, there was a spike in device purchases, but the trend is not sustainable.
Forced to change
The recovery, after the already-in-motion decline, will be even more rapid, according to Gartner. This statement holds when viewed through the context of the economy as a whole. John-David Lovelock, the distinguished research vice-president at Gartner, says that organizations will not be able to return to processes that are now outdated, due to the disruption of typical revenue streams.
After the pandemic, companies will be moving more into becoming digital than initially planned. 2021 should start with a backlog of IT projects and available funds to spend on these projects. Starting next year, the recovery phase will see more subscription products and cloud services to get great business.
There will be growth
IaaS (infrastructure as a service) could grow by up to 27.6 %, to hit the $50 billion mark in 2020 and a little over $64 billion in 2021. Cloud-based conferencing predictions indicate a rise of 46.7% in 2020. Many businesses will soon witness better revenue levels after the lockdown restrictions are relaxed.
The pandemic pushed the pause button, which means the restart button is next. That is what will drive growth out of this year and into 2021. Businesses will be forced to spend money on exceptional IT provisions to mask a messy recovery period.