Go to Market IT Spending Research

Go to Market Charts Marketing – IaaS Software Spending

Public cloud IaaS hardware and software spending from 2015 to 2026

o to Market Charts Marketing - IaaS Software SpendingThe graphic from statista shows the level of spending ( $38B in 2016) on global public cloud infrastructure (both hardware and software).

In 2016, spending on public cloud Infrastructure as a Service hardware and software is forecast to reach 38B globally.

Amazon is the market share leader with 27% of the market through the first half of 2015.

Infrastructure as a Service currently represents almost one-third of the overall cloud computing market.

The IaaS market share leaders are Amazon with its Web Services (AWS) offering; Microsoft, with Azure; Google, via its Compute Engine; and IBM with its SmartCloud Enterprise.


Go to Market IT Spending Research – Gartner Predicts IT Spending to Hit $3.5T in 2017

Go to Market IT Spending Research - Gartner Predicts IT SpendingRevenue growth in software and IT services revenue is expected to drive the worldwide IT spending is forecast t0 $3.5T in 2017.

2017 IT spending is forecast to be a 2.9% gain over 2016, according to Gartner.

Software and IT services are to be the growth segments.

Software spending is projected to grow 6% in 2016, 7.2% in 2017 ( $357B).

IT services spending is on pace to grow 3.9% in 2016 ($900B), a 4.8% gain in 2017 ($943B)


Go to Market IT Spending Research – Gartner Worldwide IT Spending Breakdown & Forecast

Go to Market IT Spending Research - Gartner Worldwide IT Spending Breakdown & ForecastThe Gartner Worldwide IT Spending Breakdown & Forecast for Q3’16 was released by Gartner.

IT spending includes devices, IT services, data center systems, enterprise software and telecom services markets across all geographies.

Communications spend is the still the largest spend line item, followed by IT services devices , software and then data center systems –  the top two line items represent over 505 of IT spend while the top 3 account for over 75% of IT spend.

Gartner’s global forecast for IT spending growth in 2016 has been revised slightly to show a decline of negative 0.3%.

 


Go to Market IT Spending Research – Gartner Says Worldwide IT Spending Is Forecast to Be Flat in 2016

According to Gartner’s Worldwide IT Spending Forecast, the $3.4T in IT spending is to be flat in 2016 which is actually is up from the negative 0.5 percent growth last quarter. However, the change in the forecast not to a fundamental change in demand but due to currency fluctuations.

Go to Market IT Spending Research – How Much is Spent on IT Data Center

Spending on Data center systems is forecast to be $174B in 2016, a 2% increase from 2015. The market is believed to be driven by strong growth in the server markets in Greater China and Western Europe and a strong refresh cycle is anticipated in the US enterprise network equipment market.

Go to Market IT Spending Research – How Much is Spent on Enterprise Software

Go to Market IT Spending Research - Gartner Worldwide IT Spending Is ForecastEnterprise software spending is on course to reach one-third of a trillion or $332B – up 5.8% from 2015. The US is driving that growth as it contributed almost half of the incremental gain ($11.6B of the $24B increase) from 2015 to 2016–customer relationship management (CRM) is the fastest growing segment.

Go to Market IT Spending Research – How Much is Spent on Devices

Devices (including desktop, laptop, smartphones, tablets, etc) spending in 2016 is forecast to total $627B.  Demand in Russia, Japan and Brazil are stifling the global PC recovery.

Go to Market IT Spending Research – How Much is Spent on IT Services

Spending in the IT services market is forecast to rise 3.7% to total $898B. The fastest growing region for IT services spending is Japan at 8.9% growth. Japanese based companies are beginning to comprehend that they need consulting support and advice to transform their business- value is perceived and more importantly, there is a willingness to pay for the services.

Go to Market IT Spending Research – How Much is Spent on Communications

Communications services spending is forecast to total $1.4T in 2016.  While a staggering figure, this total is down 1.4% from 2015. Japan grew at 8.3% but China spent the most– $8.3B. Eastern Europe, Western Europe and North America all are forecast to decrease service spending as price wars and declining usage affect most communications services markets.


Go to Market IT Spending Research – Priorities

Go to Market Research - IT Budget PrioritiesZDNETs IT budgets 2016: Surveys, software and services is a key piece of go to market IT spending research.

The survey shows IT budgets and headcounts remaining largely flat.

CIOs are faced with the problem of figuring out how to keep the business running while pursuing innovative projects on last year’s budget.

IT budget priorities for 2106 shows a clear focus on operational efficiency, security and business continuity.

Other areas of priority include mobile device management, plus the simplification and automation of many internal IT processes.


Go to Market IT Spending Research – Gartner’s IT Spending Forecast

Gartner forecast for IT Spending Across Vertical Industries to Decline 3.5% in 2015 – all industries to decline.

Worldwide IT spending across vertical industries is forecast to total $2.7T in 2015 or a 3.5% decrease from 2014.

Go to Market Research - WW IT Spending ForecastGo to Market IT Spending Retail
Technologies that help understand customers better, improve engagement through multichannel experience and facilitate the buying process are high-priority areas.

Building IT infrastructure to accept various mobile payment systems and digital wallets are also expected to be a high priority.

Go to Market IT Spending Banking & Securities
Gartner expects banks in developed markets to 2X their IT budgets to support digital and other new technology initiatives through 2019
Legacy maintenance is expected to decline.

Investment in data solutions, driven by availability of big data, analytics tools and competition from financial technology companies is expected.

Cybersecurity remains an area of focus in consumer banking segments, while an emerging area of interest is smart machine technology, including artificial intelligence, robotic process automation, intelligent analytics and deep learning.

Go to Market IT Spending Healthcare
The U.S. accounts for 40% of all spending and is the largest healthcare IT market globally

Investments in healthcare IT, driven mainly by the government’s Health Information Technology for Economic and Clinical Health (HITECH) Act provides financial incentives for hospitals and physicians to invest in IT, including electronic health records and other health information management systems.

Gartner expects healthcare institutions to increase their spending on telehealth technologies by more than 15% annually, although starting from a very low base.


Go to Market IT Spending Research -Technology Decisions – The Role of Tech

The 2015 IDG Enterprise Role & Influence of the Technology Decision-Maker survey was fielded to gain insight into the evolving role and influence of IT decision-makers.  Based on over 1200 respondents, the survey results provides detail into the various types of IT organizations and how they differ, examines strategic partnerships and drills down into the emerging technologies in the purchase process.

Technology Decisions – The Role of Tech – Key Findings

  • Go to Market Technology Decision - The Role of Tech50% of enterprises currently have a federated IT structure
  • 42% use enterprises use a centralized model
  • 8% are decentralized
  • Both executive IT and IT management are highly involved in the collaboration with LOB on projects or technical needs
  • On average, IT decision-makers collaborate with 3.4 functions/titles –3.9 for enterprises versus 3.1 for SMB
  • The CTO/IT architect/engineer is showing greater involvement in the middle of the IT purchase process and is less involved in determining the business need and approval/authorization
  • Emerging technology vendors are primarily found through research (67% of the time), discussions with peers (61%) and attending physical events (57%)
  • Technology vendors must be focused on customer service/response time, the ability to understand business goals and objectives, post-sales support and services, and demonstrate the long-term viability of their company in order to become a valued strategic partner
  • Peers remain the most powerful source for technology information

Go to Market IT Spending Research -IT Spending by Vertical

Go to Market Research - IT Spending by IndustryGartner calculated IT spending as a percent of revenue, by industry.

These percentages are relatively slow to change so even though it is 2014 data it is still useful.

Garter provides estimates of the percentage of revenue that each industry spends on IT spending.  It’s important to note that IT spending spans hardware, software, people, services and telecommunications.

Typically, a fraction of IT spend usually a reasonable estimate of what a customer may spend with any vendor – excluding the IBMs, HPs, Accenture’s, Deloitte’s, etc.


Go to Market IT Spending Research

Go to Market IT Spending Research - Forrester's Global IT SpendThis is Forrester’s look Global IT spending which was $2T and that includes software, hardware, and IT services by enterprises and governments in 2013.

Even though the data is 2103, a key got to market planning point is the composition of spending.  So, assuming that your company will capture a fixed percent of IT spend is not accurate if you are a software vendor.  The calculation should be a percentage of the software segment of IT spend.

The primary components of IT spending are:

  • Software
  • IT Outsourcing
  • Computer Equipment
  • IT Consulting
  • Communication Equipment

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