Software and services sales to surge: Gartner

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Software and services sales to surge: Gartner

Analyst firm Gartner has predicted that Australian businesses will spend big on software and services.

The firm has issued a new forecast that says spending on technology products and services is forecast to grow 5.7 percent to $99.6 billion in 2020, and reach $103.2 billion in 2021. That growth is faster than the firm’s predicted global average of 3.4 percent

Gartner research vice-president John-David Lovelock said “Almost all of the market segments with enterprise software are being driven by the adoption of software as a service (SaaS). We even expect spending on forms of software that are not cloud to continue to grow, albeit at a slower rate. SaaS is gaining more of the new spending, although licensed-based software will still be purchased and its use expanded through 2023.”

Forecast: Spending on IT Products and Services, Australia, 2019-2021 (AUD millions)

Segment

2019

2020

2021

Data Centre Systems

3,063

3,134

3,103

Software

16,866

18,878

21,035

Devices

12,792

13,092

12,520

IT Services

34,370

36,000

37,632

Communication Services

27,154

28,529

28,882

Grand Total

94,245

99,634

103,172

Source: Gartner (January 2020)

Cloud spending growth will also move faster than traditional tech until 2022, the firm predicts. Which accounts for the predicted dip in data centre sales foe 2021.

“Last quarter, we introduced the ‘and’ dilemma where enterprises are challenged with cutting costs and investing for growth simultaneously,” Lovelock said. “Maturing cloud environments is an example of how this dilemma is alleviated: Organizations can expect a greater return on their cloud investments through cost savings, improved agility and innovation, and better security. This spending trend isn’t going away anytime soon.”  

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