The analyst firm, IDC, has forecasted that worldwide spending on information and communications technology (ICT) will reach $4.3 trillion in 2020 – that’s 3.6% over 2019. The majority of the spending ($2.7 trillion) will come from the private and public sector while the rest will come from consumer spending.
Judging by comments from IDC’s Serena Da Rold, program manager in IDC’s Customer Insights and Analysis group, the spend figure may have been higher if there were more favourable conditions:
“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.”
IDC said that IT spending will make up more than half of ICT spending this year driven by the purchases of mobile phones. PCs, and enterprise applications. It said that IT services will contribute $750 billion to the figure as more organisations digitise. On the telecommunications front, over one-third of ICT spending for the year will come from this sector. Mobile telecom services and fixed telecom services will be the biggest contributors to telecommunications spend and see growth in the low single digits.
Delivering over 40% of commercial ICT spending in 2020 are the banking, discrete manufacturing, professional services, and telecommunications industries. Where they spend their money varies, for example, IT services will be a big part of spending for all of the industries, representing 50% in banking, 26% in professional services, and somewhere in-between for the other two.
The analyst said that while banking and discrete manufacturing spend on applications, telecommunications and professional services will be investing in infrastructure. It’s hardly a surprise to hear this about telecommunications with 5G rollouts commencing all over the world.
One noticeable aspect not mentioned by IDC is the COVID-19 outbreak currently affecting production in China. Just today, Neowin reported that Apple was adjusting its revenue guidance due to production facilities opening slower than it expected. If the virus continues to be a problem we could see IDC’s figures completely thrown off.