Gartner Forecasts Worldwide IT Spending to Grow 8% in 2024
Worldwide IT spending is projected to total $5.1 trillion in 2024, an increase of 8% from 2023, according to the latest forecast by Gartner. While generative AI (GenAI) has not yet had a material impact on IT spending, investment in AI more broadly is supporting overall IT spending growth, according to the company’s research.
“In 2023 and 2024, very little IT spending will be tied to GenAI,” said John-David Lovelock, Distinguished VP Analyst at Gartner. “However, organizations are continuing to invest in AI and automation to increase operational efficiency and bridge IT talent gaps. The hype around GenAI is supporting this trend, as CIOs recognize that today’s AI projects will be instrumental in developing an AI strategy and story before GenAI becomes part of their IT budgets starting in 2025.”
Gartner says the software and IT services segments will both see double-digit growth in 2024, largely driven by cloud spending. Global spending on public cloud services is forecast to increase 20.4% in 2024, and similarly to 2023, the source of growth will be combination of cloud vendor price increases and increased utilization.
While inflation’s effect on both consumers and businesses plagued the devices market throughout 2022 and 2023, devices spending will begin to rebound modestly in 2024, growing 4.8%.
Cybersecurity spending is also driving growth in the software segment. In the 2024 Gartner CIO and Technology Executive Survey, 80% of CIOs reported that they plan to increase spending on cyber/information security in 2024, the top technology category for increased investment.
“AI has created a new security scare for organizations,” said Lovelock. “Gartner is projecting double-digit growth across all segments of enterprise security spending for 2024.”
The report also states that CIOs are experiencing change fatigue, which is often manifesting as a hesitation to invest in new projects and initiatives. This is pushing a portion of 2023’s IT spending into 2024, a trend that is expected to continue into 2025.
“Faced with a new wave of pragmatism, capital restrictions or margin concerns, CIOs are delaying some IT spending,” said Lovelock. “Organizations are shifting the emphasis of IT projects towards cost control, efficiencies and automation, while curtailing IT initiatives that will take longer to deliver returns.”
The most recent IT spending forecast research is available to Gartner clients in “Gartner Market Databook, 3Q23 Update.”
The report is designed to help Gartner clients understand market opportunities and challenges across the hardware, software, IT services and telecommunications segments.
Verizon State of Small Business Survey Finds Small Businesses Want AI
Verizon Business has announced the findings of its fourth annual State of Small Business Survey, generated through responses from 681 small and midsize businesses across the country. The data suggest that small businesses have a constant need to increase connectivity to meet business demands and are exploring the applications of emerging technologies such as Artificial Intelligence (AI), but as their technology dependence grows, looming concerns regarding cybersecurity persist.
“The fact that nearly half of small and midsize businesses are either using or are aware of the AI-specific use cases that can drive their companies forward highlights what we hear from our customers every day regarding their desire to stay ahead of the pace of change to drive their business forward,” said Aparna Khurjekar, Chief Revenue Officer, Business Markets and SaaS, at Verizon Business.
More than a third of small and midsize businesses (35%) believe AI can help offset pain points caused by labor shortages. Additionally, to enable small business owners to spend more time on their core business and with customers, 46% would find value or are using AI to drive order processing, and the same amount also see AI being utilized in inventory management and supply chain operations.
Though more small and midsize businesses are exploring AI solutions, many are still leery of its implementation. Nearly half (45%) are concerned about integrating AI solutions, and 43% are worried AI tools will expose them to cybersecurity risks.
Meanwhile, internet bandwidth continues to be an issue. In 2020, more than a quarter (27%) of small and midsize companies upgraded their internet connection bandwidth. The economic shutdown drove much of that, as businesses had no choice but to operate digitally in order to reach customers.
In addition, a good portion of small and midsize businesses are failing to invest in cybersecurity proportionately to their investment in internet bandwidth and other technology upgrades. Only one in three have implemented new systems of technology to ensure security, and almost half (45%) do not offer their employees any training on cybersecurity practices.
Inflation remains a top concern. Eighty-one percent of respondents are concerned about the impact inflation will have on their business. Four out of five business owners have experienced increased costs in the last year. Additionally, 59% have either raised or planned to raise the prices of goods and services and a similar number (57%) have either reduced or plan to reduce their spending on non-essential items and activities. In spite of these concerns, most business owners (63%) are expecting an increase in demand this holiday season.
The data provide important clues regarding where channel partners should be looking to expand their influence within customer organizations.
Pure Storage Expands its Strategy for Storage as-a-Service
Pure Storage, a Santa Clara, California-based storage vendor, has advanced its Evergreen portfolio with the introduction of new incentives to support its Evergreen//One Storage as-a-Service (STaaS) and Evergreen//Flex subscriptions.
Under the new terms, Pure Storage will pay for its customers’ power and rack space through an Evergreen//One Storage as-a-Service (STaaS) and Evergreen//Flex subscription to take responsibility for the associated costs of power and rack unit to run their offerings. The one-time, upfront payment can be made directly as cash or via service credits, is based on kilowatt per hour (kWh) and Rack Unit (RU) fixed rates, and is proportional to the customer’s geographic location and contract size.
In addition, expanded guarantees support customers who opt to own their storage via an Evergreen//Forever subscription. The Power and Space Efficiency Guarantee supports Evergreen//Forever customers’ efforts to consume less power and store more data with less space, reduce energy costs, and report more accurately with transparent measurement of actual Watts per tebibyte (TiB). If the guaranteed Watts/TiB or TiB/Rack is not met, Pure Storage will cover the cost. The Energy Efficiency guarantee is already available as an Evergreen//One SLA.
The No Data Migration and Zero Data Loss guarantees for Evergreen//One (SLA), Evergreen//Flex, and Evergreen//Forever enable customers to mitigate unplanned costs due to data loss incidents, while maintaining day-to-day business operations amid upgrades. Pure assures data protection with advanced data recovery services for any hardware or software product-related incidents, at no cost. Pure also ensures seamless technology upgrades with no data migrations.
The additional commitments are intended to ensure enterprises’ energy-efficiency, capacity density, and data loss protection.