Commercial Sector Will Lead ICT Spending to $4.8 Trillion in 2023

Commercial Sector Will Lead ICT Spending to $4.8 Trillion in 2023

Foto: Depositphotos

Despite a slowing global economy and the looming trade war between the United States and China, purchases of information and communications technology are expected to maintain steady growth over the next five years. IDC predicts worldwide ICT spending on hardware, software, services, and telecommunications will achieve a compound annual growth rate (CAGR) of 3.8% over the 2019-2023 forecast period, reaching $4.8 trillion in 2023.

"Global market conditions remain volatile, and although the economy has performed broadly better than expected in the past six months in many countries, a sense of uncertainty over the short-term economic and business outlook has been rising at the same time," said Serena Da Rold, program manager in IDC's Customer Insights and Analysis group.

"Confidence indicators are fluctuating on a monthly basis with a potential global slowdown looming for 2019 and 2020. End-user surveys reflect the impact of this uncertainty on business decision-making, but our forecasts remain roughly stable overall for 2019, and slightly accelerated in the medium term, driven by stronger growth in software and hardware. Digital transformation and the adoption of automation technologies will be driving investments in applications, analytics, middleware, and data management software, as well as increasing demand for server and storage capacity."

Commercial purchases will account for nearly two thirds of all ICT spending by 2023, up from 60.4% in 2018 and growing at a solid five-year CAGR of 5.1%. Banking and discrete manufacturing will be the industries spending the most on ICT over the forecast period followed by professional services, which will also see the fastest growth in ICT spending, driven largely by service provider spending.

While purchases for planned upgrades and refresh cycles will continue to be the largest driver of commercial ICT spending, new investments in the technologies and services that enable the digital transformation (DX) of business models, products and services, and organizations will be a significant source of spending. IDC recently forecast worldwide DX spending to reach $1.18 trillion in 2019.

Consumer ICT spending will grow at a much slower rate (1.5% CAGR) resulting in a gradual loss of share over the five-year forecast period. Consumer spending will be dominated by purchases of mobile telecom services and devices. The United States will be the largest geographic market with ICT spending forecast to reach $1.66 trillion in 2023. Western Europe will be the second largest region with $927 billion, followed by China at $618 billion. China will also be the fastest growing region with a five-year CAGR of 6.1%.

More from category

Britons Amongst Least Concerned About Losing Jobs to Technology

Britons Amongst Least Concerned About Losing Jobs to Technology

18 Oct 2019 comment

24% Britons are concerned or very concerned about losing their job because of technological changes.

Mobile Data and Pay-TV Services to Drive Telecom Revenue Growth in Japan

Mobile Data and Pay-TV Services to Drive Telecom Revenue Growth in Japan

17 Oct 2019 comment

The total telecom and pay-TV services revenue in Japan is set to grow at a moderate CAGR of 2.3% between 2018 and 2023, according to GlobalData.

Small Domestic Appliances Market Grows to €24.3 Billion in 1H19

Small Domestic Appliances Market Grows to €24.3 Billion in 1H19

16 Oct 2019 comment

Demand for small domestic appliances continued to grow during the first half of 2019.