Story image

NZ and Australian IT spend ahead of global forecast

11 Apr 2017

Local IT spend is tracking well ahead of the global average with Gartner forecasting 3.5% growth this year for Australia and New Zealand not far behind on 2.7% growth.

Those figures are well ahead of the forecast worldwide IT spend increase of 1.4%, and will see Australian spend hit AU$86.9 billion, with New Zealand spend hitting $11.6 billion.

Come 2018, Gartner is forecasting Australian spend to reach $86.3 billion, with New Zealand hitting $11.9 billion.

Both markets are forecast to see growth across all categories – with the exception of data centre systems, which Gartner is forecasting will decline in both countries this year, before bouncing back in 2018.

Globally the data centre system segment is expected to grow just 0.3% as the shift to cloud infrastructure from companies such as Amazon, Google and Microsoft, cuts spending on servers, dragging down the overall data centre system market, which recorded negative growth in 2016.

In New Zealand, Gartner says devices spend will hit NZ$1.8 billion this year, up from $1.7 billion in 2016, with software climbing from $1.4 bilion to $1.5 billion. IT services is forecast to rise from $3.4 billion to $3.5 billion, with communications services seeing less growth but still on an upward trajectory, from $4.35 billion to $4.38 billion.

Data centre systems is forecast to decline from $348 million to $344 million, before jumping back to $348 million come 2018.

Growth across all other categories is forecast to continue into 2018, when the overall Kiwi IT spend is expected to hit $11.9 billion.

In Australia software is the big mover, up from $10.6 billion in 2016 to a predicted $11.7 billion this year. That growth is expected to accelerate into 2018, when Gartner is forecasting spend of $12.9 billion.

Device spend climbs from $11.9 billion to $12.4 billion; IT services is up from $29.8 billion to $30.6 billion, and communications services rise from $28.9 billion to $29.5 billion.

On the data centre systems front, Gartner is forecasting a small decline, from $2.69 billion to $2.67 billion. That trend reverses moving into 2018, when data centre system spend is expected to hit $2.7 billion.

Come 2018, Gartner is forecasting a slight decline for devices in Australia, with all other categories climbing to take the overall market to $89.3 billion.

The local figures come against a backdrop of declining growth for IT spend globally. Worldwide IT spend is projected to reach US$3.5 trillion this year, a 1.4% increase on last year’s figures, and down on the previous quarter’s forecast of 2.7% thanks to the rising US dollar.

That strong US dollar has cut US$67 billion from the spending forecast and is expected to be a drag on earnings of US-based multinational IT vendors throughout this year.

Globally, enterprise software is expected to see continued strong growth at 5.5% to hit US$351 billion this year, after recording 5.9% growth in 2016.

Devices are expected to bounce back to positive growth of 1.7% after recording negative growth of 2.6% last year, driven by strength in mobile phone sales and smaller improvements in sales of printers, PCs and tablets.

Gartner says mobile phone growth will be driven by increased average selling prices for phones in emerging Asia Pacific and China, together with iPhone replacements and the 10th anniversary of the iPhone.

IT services are forecast to climb 2.3% in 2017, a drop from last year’s 3.6% growth; while communications services is expected to decline 0.3%.

Come 2018, Gartner is forecasting all categories to be back in positive growth, with enterprise software expected to be the biggest climber, hitting 7.1% growth to reach $376 billion, followed by IT services with growth of 4.7% to hit US$961 billion.

Zoom’s new Rooms and Meetings features
Zoom has released information about the upcoming releases for its Rooms and Meeting offerings for 2019.
Aussie company set to democratise direct-to-orbit IoT access
Adelaide-based Myriota has released a developer toolkit that has been trialled and tested by a smart waste management platform.
Apple's AirPods now come with 'Hey Siri' functionality
The new AirPods come with a standard case or a Wireless Charging Case that holds additional charges for more than 24 hours of listening time.
Dynatrace takes pole position in APM Magic Quadrant
It placed highest on Ability to Execute and furthest on Completeness of Vision in the 2019 Quadrant for Application Performance Monitoring (APM).
HCL and Xerox expand strategic partnership
Under the terms of the agreement, HCL will manage portions of Xerox’s shared services, including global administrative and support functions.
Avaya expands integration with Google Cloud AI
This includes embedding Google’s machine learning within conversation services for the contact centre, enabling integration of AI capabilities.
Forrester names Crowdstrike leader in incident response
The report provides an in-depth evaluation of the top 15 IR service providers across 11 criteria.
Poly appoints new A/NZ managing director, Andy Hurt
“We’re excited to be bringing together two established pioneers in audio and video technology to be moving forward and one business – Poly."