Tech spending forecasters at Gartner are all in a tizzy – Brexit and currency fluctuations are both to blame.
At the start of this year, the crystal ball stroker estimated the industry would grow 0.5 per cent in 2016, then flip flopped and reduced this prediction by a full percentage point to $3.49 trillion, blaming the negative affect of forex rates.
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In the third and latest forecast, Gartner claimed currency fluctuations had improved the outlook and spending would actually be the same as last year at $3.41 trillion.
But Steve Cramoysan, research director, told us the latest figure was based on modelling under the assumption that Brits would vote to remain in the EU.
"This forecast was actually up compared [to the last one] but it does not include the consequence of Brexit, which will impact UK spending [negatively] by between two and five per cent."
He said another update will be provided in the third quarter, which makes the breakdown of this contemporary one rather pointless, but here goes:
- Data centre spending is expected to rise two per cent to $174.5bn.
- Software is tipped to grow 5.8 per cent to $332.2bn.
- Devices will shrink 4.6 per cent to $627.2bn.
- IT services are expected to decline 3.7 per cent to $897.6bn.
- Comms Service will drop 1.4 per cent to $1.4tr.
The price of tech is starting to rise in the UK, with Dell the first to confirm the depreciation of Sterling had forced its hand.
Cisco sells in US dollars and so its price went up immediately after the Brexit vote, when Sterling crashed against the US Dollar. Dell agreed the currency swing forced its hand to increase prices. All hardware vendors are expected to react to the currency changes too.
The British Pound has again fallen to another thirty-year low this week, dropping to $1.29. ®