Tech Spending Up 9 Percent In 2011, But Slowing In 2012

February 13, 2012 Timothy Prickett Morgan

There are a lot of prognostications and predictions this time of year about what the new year will hold in terms of IT spending and shifts of focus for the IT department as it copes with changes in the business environment. It is tough to get a complete picture sitting as you do at your desk, which is why we keep our eyes out for what the Wizards of IT say about the future.

The latest predictions are coming out of IDC, which has just updated its Worldwide Black Book, its mother-of-all reports that shows IT spending diced and sliced in a zillion ways across 54 countries. While IDC does not give away this data for free, it does put out some teaser information that you can put into your thinking as you ponder your own path through the IT market in 2012.

IDC’s book says that based in U.S. dollars, IT spending was up nearly 9 percent in 2011. This was despite issues in the Eurozone, where debts are mounting in the governments of Greece, Spain, Ireland, Portugal, and now Bulgaria, and disk drive shortages, which messed up PC and server sales in the second half of last year and are continuing to cause issues for some IT product suppliers this year. The strongest selling product in 2011 was–you guessed it–the smartphone, which had a 46 percent increase in revenues, followed by enterprise software, up 6 percent, and storage arrays and drives, up 6 percent as well.

In Europe, IDC calculates that IT spending (as reckoned in local currencies and then converted to U.S. dollars at a current rates) were flat across the entire IT spectrum, with spending on PCs, servers, storage, network gear, and other peripherals all heading south. IDC is projecting pretty anemic growth of 1 percent in IT spending in Europe in 2012 and 3 percent in 2013.

In the United States, IT spending across hardware, software, and services rose by 7 percent in 2011 and the wizards are projecting 5 percent growth this year across all segments. Mobile devices, software, and network equipment will see the biggest increases in the States.

IT spending is predicted to rise by 9 percent this year in Brazil, 11 percent in Russia, 16 percent in India, and 15 percent in China, so the BRIC countries continue to be red hot. And if you are in the United States and Europe, you can expect proportionately less love and attention from your IT vendors.

On a worldwide basis, IDC is projecting for IT spending to rise by 5 percent, with a 6 percent increase in hardware spending, a 6 per cent rise in software budgets, and a 4 percent bump in IT services bills.