GLOBAL SPENDING on information technology (IT) will rise at the slowest pace in three years in 2012 as Europeans, worried about the region’s sovereign debt crisis, cut back on investments, research firm Gartner said.
“When we look at the euro zone, the scenarios range from bad to very bad to catastrophic,” Richard Gordon, research vice-president at Gartner, said yesterday.
“We’ve taken the bad scenario, but things could turn much worse. At the moment we assume it will muddle through and find some kind of solution,” he said.
Gartner predicted global IT spending, a bellwether of firms’ willingness to invest, would rise 3.7 per cent in 2012, down from its earlier estimate of 4.6 per cent.
The forecast for western Europe was slashed to a 0.7 per cent drop in spending from a previously expected rise of 3.4 per cent.
“The main reason is ongoing uncertainty around the euro zone: this is going to impact business and private confidence,” Mr Gordon said. Governments’ austerity measures were likely to weigh on public IT spending, while the financial services industry’s woes would likely weigh on investments there, he added.
Mr Gordon said there was still quite strong growth in emerging markets and predicted more resilient sectors, like software sales and telecom gear, would drive worldwide growth.
But the 3.7 per cent global growth forecast was historically a modest number, he added.
In 2011, worldwide IT spending totalled $3.7 trillion, up 6.9 per cent from 2010, when the growth was around 6 per cent.
On top of macroeconomic worries, the impact of floods in Thailand on hard-disk drive (HDD) production would hit the technology sector in 2012, Gartner said.
The floods would cut the supply of HDDs by 25 per cent or more during the next six to nine months as Thailand has been a major hub for finished HDDs and their components, it said. – (Reuters)
