Australia shines as worldwide IT market slumps

Australia shines as worldwide IT market slumps

Gartner stresses that a 5.5 per cent drop "is not a market crash."

Customers waiting for Windows 10 is causing PC inventory to clog up pre-launch, but should clear by year end

Customers waiting for Windows 10 is causing PC inventory to clog up pre-launch, but should clear by year end

Gartner has said that the worldwide IT spending slump is not symptomatic of a market crash, as Australia's rise bucks the trend.

Worldwide IT spending is expected to shrivel to $US3.5 trillion in 2015, according to Gartner Research, a drop of 5.5 per cent on 2014.

The research firm's previous forecast in April was for a drop of 1.3 per cent. John-David Lovelock, Gartner's research vice president places the fluctuation at the feet of a rising US dollar.

"We want to stress that this is not a market crash. Such are the illusions that large swings in the value of the U.S. dollar versus other currencies can create," he said

"However, there are secondary effects to the rising US dollar. Vendors do have to raise prices to protect costs and margins of their products, and enterprises and consumers will have to make new purchase decisions in light of the new prices."

Australia has managed to buck the trend, as IT spending is forecast to reach $78.1bn in 2015, a 2.1 per cent increase.

Of that, IT services will represent $28.8 billion, while software is the fasting growing, at 9.8 percent to reach $9.4 billion.

Australia's figures beat APAC's rise of just 0.7 per cent, and New Zealand which has dropped 0.8 per cent.

Globally, Gartner believes that smartphone sales will flatten, once the Chinese boom for Apple products subsides, and PC sales will remain problematic until Windows 10 launches - with many vendors showing excessive inventory levels that will not clear until the end the of year.

Global enterprise software spending is forecast to decline 1.2 percent in 2015, with revenue totaling $654 billion. Gartner analysts said many software vendors will try not to raise prices because software as a service (SaaS) is now about future market share, not current profitability. As Gartner's research puts in "these vendors don't believe they can afford to lose a client."

Despite Australia's booming IT services market, globally these services are projected to decline 4.3 percent. Gartner believes that the market is transitioning, as buyers increasingly demand time efficient delivery methods, out-of-the-box implementation, and lower-cost solutions.

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