GLOBAL CHALLENGES

IT Boosted by Tablets Despite Global Turmoil

R. Colin Johnson | Date: 04-05-11 | Comments

Analysts have revised upward their forecasts for IT growth in 2011 based on skyrocketing sales of touch-screen tablets. This optimism comes despite economic softening in Japan and the Middle East.

Global turmoil, especially in Japan and the Middle East, could not dampen analysts' projections of increased IT spending in 2011. The projections are higher even than was predicted last year.

The worldwide forecast for IT spending at Gartner (Stamford, Conn.) was boosted by $200 billion, from $3.4 trillion to $3.6 trillion, up 5.6 percent from 2010; Gartner had previously reported a 5.1 percent growth forecast for 2011.

Gartner predicts that overall growth in the IT market will come from four categories�hardware, software, services and telecom�that will total almost $3.6 trillion in 2011.

The huge uptake of touch-screen tablets like Apple's iPad and Motorola's Xoom was credited with some of the boost, according to Gartner. Gartner has added "media tablets" to its "computer hardware" forecast category for the first time in 2011, boosting it from 7.5 to 9.5 percent growth to $409 billion in 2011. The other IT spending forecast categories at Gartner include enterprise software (up 7.6 percent to $255 billion), IT services (up 5 percent to $824 billion) and telecom (up 4.9 percent to $2.1 trillion in 2011).

Media tablets will add $29.4 billion to IT spending in 2011, up from $9.6 billion in 2010, and are expected to grow at an annual rate of over 50 percent until 2015, where they could top $150 billion, according to Gartner.

Japan accounts for about 9 percent of IT spending worldwide and will likely be depressed until the third or fourth quarter, when it should rebound and mitigate losses for the year. Likewise, turmoil in the Middle East will likely depress IT spending in the short term, but since the area accounts for only 2 percent of the global total, according to Gartner, overall growth should not be significantly affected even if spending does not rebound there in the fall of 2011.

Because its forecast is currently being revised to account for the changing conditions on the ground in Japan and the Middle East, Gartner will host a free Webinar called "IT Spending Forecast, 1Q11 Update" on April 5 at 11 a.m. EDT.

"We had largely completed our forecast by the time the recent natural disasters in Japan occurred, and we are still evaluating their likely impact on our forecast. On this point, we are looking at two potential effects on IT markets as a result of the earthquake and tsunami in Japan: consequences of disruptions in the global electronics supply chain and impacts on IT demand," Gartner said.

Gartner presents less detailed summaries of its forecasts on YouTube and more-detailed analyses on the outlook for the IT industry as well as the use of media tablets in the enterprise on its Website.