Published on the 04/04/2014 | Written by Newsdesk
The research firm’s quarterly IT spending forecast shows enterprise software is the fastest growing IT segment in 2014 and New Zealand investment in IT is mature…
Worldwide IT spending is on track to total $US3.8 trillion in 2014 – a 3.2 percent increase from 2013 spending – according to research firm Gartner. The Asia Pacific region is experiencing some even stronger spending increases with a predicted 4.7 percent increase over spending in 2013 for the whole region and China charging ahead with the biggest increase of 8.4 percent in USD terms. New Zealand’s predicted growth seems small in comparison, slated at just 1.7 percent, reaching $NZ11.1 billion.
Derry Finkeldey, Gartner’s Sydney-based research director, told iStart however that New Zealand’s growth is modest because it is a fairly mature, but small market.
“I wouldn’t necessarily see that as lagging. New Zealand has a very high proportion of small businesses in the business landscape with smaller average IT spend. I am not aware of many large tech deals recently, and I think there has been a fair bit of consolidation and co-ordination particularly in government departments for large-scale projects that have already happened, such as Inland Revenue’s project and some of the shared services/apps in health that have been implemented,” she said.
New Zealand’s enterprise software market, is showing the biggest spending growth, in line with the worldwide trend. Gartner is predicting an 8.3 percent increase in spend in New Zealand, totalling $NZ1.3 billion this year – (6.9 percent worldwide totalling $320 billion).
Richard Gordon, managing vice president at Gartner puts this trend down to what Gartner calls the ‘Nexus of Forces’.
“The ‘Nexus of Forces’ (the convergence of social, mobile, cloud and information) continues to drive growth across key major software markets, such as CRM, database management systems (DBMSs), data integration tools and data quality tools.
“In fact, organisational adoption of data management technologies to support the Nexus will cause spending on DBMSs to surpass operating systems, making the former the largest enterprise software market in 2014.”
The IT services and data centre systmes markets came in with the second and third highest increases in spend, predicted to grow by a much smaller 2.9 percent and three percent respectively. That said the IT services spend is predicted to be $3.3 billion in 2014 – almost three times that of the enterprise software market.
Gartner says there is a worldwide trend of IT services buyers shifting their spending from consulting (planning projects) to implementation (doing projects). Analysts say they expect “steady growth in the IT services market as the economic outlook, and along with it investment sentiment, improves”.
