Global IT Spending Market Report and Forecast 2024-2032

Global IT Spending Market Size

The global IT spending market reached around USD 3.88 trillion in 2023. The market is further expected to grow at a CAGR of 3.5% in the forecast period of 2024-2032 to reach USD 5.29 trillion by 2032.

IT Spending Market Outlook

• Investments in cloud infrastructure across various sectors support the IT industry growth.

• Cybersecurity concerns are contributing to increased expenditure on safety and security of IT infrastructure across organisations.

• Digitalisation in developing countries is accelerating investments in advanced IT solutions, driving market expansion.

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IT Spending Market Growth

IT spending is the total money spent on IT systems and services by an organisation. IT spending is not only limited to IT organisations but is a significant aspect across diverse businesses, enabling the construction and maintenance of large-scale digital infrastructure and services. IT spending includes expenses related to hardware, software, professional services, cloud, and managed services.

As per the IT spending forecast, businesses are increasingly adopting methods to improve efficiency in their operations, often leveraging digital solutions. The occurrences of pandemics and closures on a global scale have reinforced the importance of robust IT infrastructure to support virtual collaborations. Robust digital infrastructure enables convenient, efficient, and secure working of organisations. Furthermore, the expansion of e-commerce, telehealth, and online education, among other sectors, has accelerated the need for virtual interactions, driving the integration of advanced IT solutions to provide improved communication services.

Key Trends and Recent Developments

As per the IT spending statistics, increasing investments in cybersecurity; adoption of artificial intelligence; growing digital infrastructure in emerging economies; and rising use of cloud computing are the major trends in the IT spending market.

Global IT Spending Market Trends

Both large and medium scale enterprises are investing in digitisation, automation as well as AI and cloud services, contributing to the IT infrastructure spending. By investing in cloud software, companies can minimise the need for expensive in-house servers, storage, networking, and some other hardware components. Further, the use of AI capabilities, for instance in software audit management helps improve performance even in data-heavy environments.

The digital transformation across diverse industries, including healthcare, retail, banking and finance, and entertainment, is a primary factor in increasing the IT spending market value. Moreover, organisations are focusing on improving their existing infrastructure and integrating advanced solutions to tackle the growing issues of data theft and security breach. The security of data is expected to remain a strategic focus area for businesses seeking to maximise efficiency and profitability.

Industry Outlook

The Cloud Application Infrastructure Services (PaaS) spending is projected to rise from USD 119,579 million in 2022 to USD 176,493 million by 2024, contributing to the IT spending industry. Cloud Application Services (SaaS) sees a significant jump from USD 174,416 million in 2022 to USD 205,221 million in 2023. Cloud Business Process Services (BPaaS) spending here is expected to grow from USD 61,557 million in 2022 and USD 66,339 million in 2023, to USD 72,923 million in 2024.

Spending on cybersecurity in 2021, reached USD 60.2 billion, and continued to grow in the subsequent years. As per the IT spending industry analysis, the upward trend is expected to continue, with spending forecasted to soar to USD 87 billion by 2024. This upward trajectory underscores the growing importance placed on cybersecurity measures amid increasing digitalization and the prevalent threat of cyber-attacks globally. The investments in cybersecurity are likely in response to the heightened need for robust security solutions to protect data and systems across various sectors.

Software spending increased from approximately USD 790.39 billion in 2022 to about USD 879.63 billion in 2023, marking a growth of 11.3% to the overall IT spending industry revenue. This indicates a robust expansion in the software sector, possibly due to increased demand for new technologies and digital transformation initiatives. Expenditure in IT services expanded from USD 1,258.2 billion in 2022 to USD 1,357.9 billion in 2023, representing a growth of 7.9%. The increase in IT services spending could be attributed to the growing need for specialized IT support, cybersecurity services, and cloud management. The data suggests a dynamic IT spending environment where software and IT services are seeing increased investment, highlighting the importance of digital infrastructure and services in the current economic landscape.

Adoption of Emerging Technologies Such as Cloud Computing and AI is Favouring the Growth of Global IT Spending Market

• The adoption of emerging technologies such as cloud computing, AI, and big data analytics aids the IT spending demand forecast, providing innovative solutions and efficiencies across various sectors.

• IT services find wide application in various sectors including healthcare, retail, and government, ensuring a steady demand.

High Costs Associated with Updating and Maintaining IT infrastructure May Impact the Growth of Global Market

• The significant costs associated with updating and maintaining IT infrastructure can be a major drawback for market growth.

• With the increasing integration of IT systems, security vulnerabilities become a prominent issue, necessitating substantial investment in cybersecurity measures that can aid the IT spending demand growth.

Rising Digital Transformation Across Several Industries is Shaping the Global IT Spending Today

• As more organizations undergo digital transformation, there is an expanding market for IT services and products that facilitate this transition.

• As per IT spending market dynamics and trends, continuous innovation provides opportunities for market expansion, especially in developing regions where IT infrastructure is still evolving.

Economic Instability and Low Investment in Technology Upgradation by Customers May Challenge the Growth of Players in Global Market

• Global economic instability can affect IT spending, as businesses may cut down on IT budgets during economic downturns, affecting the overall IT spending demand.

• The fast pace of technological advancement, while an opportunity, also poses a threat as companies must continuously update their technologies to stay competitive.

Major Factors Influencing the Competitive Landscape of The Global Market

• Continuous advancements in technology drive competitiveness, pushing companies to adopt the latest solutions to stay ahead.

• Changes in data protection laws and other regulations affect how companies invest in IT infrastructure as well as the growth of the IT spending market.

• The expansion of businesses globally drives the need for scalable and robust IT systems, influencing IT spending.

• Increasing cyber threats ensure continuous demand for updated security solutions, impacting IT budgets.

• The growing need for customized IT solutions affects how companies spend on IT services and products.

• The shift towards cloud services has a significant impact and boosts IT spending market opportunities, driving changes in how companies allocate IT spending.

Factors Impacting the Cost of IT Infrastructure:

1.    Technological Advancements: Rapid development in technologies such as artificial intelligence, machine learning, cloud computing, and the Internet of Things (IoT) drive up IT spending as companies invest in new systems and infrastructure.

2.    Cybersecurity Needs: Growing cyber threats necessitate increased spending on cybersecurity measures, including advanced security software, infrastructure upgrades, and continuous monitoring services.

3.    Cloud Migration: The shift from on-premise data centers to cloud-based solutions can lead to significant costs in terms of migration, subscription fees, and cloud infrastructure management to aid the growth of the IT spending industry.

4.    Regulatory Compliance: Adherence to regulations like GDPR, HIPAA, and other data protection laws requires ongoing investment in compliance-related technologies and processes.

5.    Workforce Training and Development: As new technologies are adopted, there is a need for continuous training and development of IT staff, which contributes to increased spending.

6.    Inflation: Rising costs of hardware, software, and IT services due to inflation directly affect overall IT expenditure.

7.    Vendor Pricing: Changes in pricing models by key IT vendors, including subscription-based services and licensing fees, can impact overall IT costs.

8.    Digital Transformation Initiatives: Businesses in the IT spending industry undergoing digital transformation require substantial investment in new technologies, integration services, and consulting, driving up IT spending. 

9.    Maintenance and Upgrades: Continuous maintenance and periodic upgrades of existing IT infrastructure to ensure optimal performance and security also contribute to ongoing IT costs.

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IT Spending Market Segmentation

“Global IT Spending Market Report and Forecast 2024-2032” offers a detailed analysis of the market based on the following segments:

Market Breakup by Type

• Data Centre Systems

• Enterprise Software

• Enterprise IT Services

• Devices

• Communications Services

The EMR report looks into the regional IT spending market like North America, Latin America, Europe, the Middle East and Africa, and the Asia Pacific.

The EMR report looks into the regional IT spending market like North America, Latin America, Europe, the Middle East and Africa, and the Asia Pacific.

Enterprise software is further divide by type into business intelligence software, content management software, customer relationship management software, enterprise resource planning software, supply chain management software, and others. Meanwhile, enterprise IT services are categorised by type into customised software and app development, and services including IT consulting, among others.

IT Spending Market Share

Data centre systems account for a significant share of the global market

There is a growing need for data centres, supported by changing work habits and the growth of cloud-based technologies, which can boost the IT spending market revenue. The growing connectivity to the internet and digital transformation across various sectors are increasing the need for fast communication lines and data transmission technologies. The importance of stable communication and passing of the maximum amount of data per unit of time is encouraging organisations to constantly improve their data centre offerings.

IT Spending Market Regional Analysis

North America accounts for a significant share of the global IT spending market. Companies in the region are increasingly investing in technology initiatives at a higher-level, with-IT spending accounting for 13% of company revenue. Businesses are focusing on improving operational efficiency through investments in cloud and are increasingly spending on infrastructure consulting services and infrastructure as a service (IaaS) solution to support their technological needs. The presence of well-established technological infrastructure in the region supports the demand of IT spending market. Meanwhile, the Asia Pacific and the Middle East and Africa are expected to be emerging markets, supported by economic stability and favourable government initiatives to support digitalisation across sectors.

Key Highlights of the Report