Partner-delivered IT technologies and services will exceed US$3.4 trillion in 2023, accounting for more than 70% of the global total addressable IT market, according to market research by Canalys, which also forecasts worldwide total addressable IT market growth of 3.5% to reach US$4.7 trillion this year.
Spending in North America is projected to grow 2.8% this year, down from 8.5% in 2022, to account for 37.7% of the total addressable market. The slowdown in cloud service provider capital expenditure in the first half of the year and a decline in telecommunications services spending are key factors. Asia Pacific is forecast to grow 4.5%, EMEA 3.4% and Latin America 3.0% in 2023.
“The long-term technology mega-trends will continue to drive growth opportunities for both vendors and channel partners in 2023,” said Matthew Ball, Chief Analyst at Canalys. “Digital transformation, cybersecurity, compliance, sustainability, and the emergence of generative AI will underpin IT services engagement, the adoption of new software and infrastructure refresh. But there are still major headwinds for the industry to navigate. The threat of recession, rising interest rates, high inflation, trade disputes and extreme weather events will continue to cause much disruption and affect confidence.”
The latest research shows cybersecurity will remain a key growth opportunity, increasing by 11.1% to US$79 billion. This reflects the heightened demand for securing data, systems, and people against rising threats. Network infrastructure is expected to reach record highs, as fulfillment of campus switch and Wi-Fi 6/6e access point order backlogs boost spending by 13.9% to US$72 billion. Price rises, renewals and the upselling of subscriptions will grow cloud application software spending by 19.3% to US$215 billion. Optimization of public cloud spending, cybersecurity posture transformation and business adoption of generative AI will create further consulting opportunities and contribute to IT services spending expanding by 7.5% to US$1.5 trillion. Managed IT services alone will become a half-trillion-dollar business, according to Canalys.
On the other hand, sales of servers, storage and client devices are expected to suffer negative or flat growth after the strong demand surge fueled by accelerated data center buildout by cloud service providers and enablement of remote workers during the COVID-19 pandemic.
This data is useful in helping channel partners, industry leaders, and decision-makers to understand the implications for their businesses and gain a greater understanding of current market dynamics.