ICT Spending Will Reach $4.3 Trillion in 2020

ICT Spending Will Reach $4.3 Trillion in 2020

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Worldwide spending on information and communications technology will be $4.3 trillion in 2020, an increase of 3.6% over 2019, according to IDC. Commercial and public sector spending on information technology, telecommunications services, and business services will account for nearly $2.7 trillion of the total in 2020 with consumer spending making up the remainder.

"The slow economy, weak business investment, and uncertain production expectations combined with protectionist policies and geopolitical tensions, including the US-China trade war, threats of US tariffs on EU automobiles and the EU's expected response, and continued uncertainty around the Brexit deal, are still acting as inhibitors to ICT spending across regions," said Serena Da Rold, program manager in IDC's Customer Insights and Analysis group.

"On the upside, our surveys indicate a strong focus on customer experience and on creating innovative products and services driving new ICT investments. Companies and organizations across industries are shifting gears in their digital transformation process, investing in cloud, mobility, the Internet of Things, artificial intelligence, robotics, and increasingly in DevOps and edge computing, to transform their business processes," Da Rold added.

IT spending will make up more than half of all ICT spending in 2020, led by purchases of devices (mainly mobile phones and PCs) and enterprise applications. However, when combined, the three IT services categories will deliver more than $750 billion in spending this year as organizations look to accelerate their digital transformation efforts. The application development & deployment category will provide the strongest spending growth over the 2019-2023 forecast period with a five-year compound annual growth rates of 11.1%.

Telecommunications services will represent more than one third of all spending in 2020. Mobile telecom services will be the largest category at more than $859 billion, followed by fixed telecom services. Both categories will see growth in the low single digits over the forecast period. Business services, including key horizontal business process outsourcing and business consulting, will be about half the size of the IT services market in 2020 with solid growth (8.2% CAGR) expected for business consulting. Consumer ICT spending will grow at a much slower rate (0.7% 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.

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