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The impact on information technology (IT) spending in EMEA

Gartner is an organization offering analysis, insight and strategic advice in the world’s emerging market trends for tech leaders and their teams to achieve mission-critical priorities and to build the successful organizations of tomorrow. Gartner’s latest analysis forecasts IT spending in EMEA to grow 4.7% in 2022 (as shown in table 1 below), a total of $1.3 trillion.

John Lovelock, Vice President, Gartner, said, “IT is transitioning from supporting the business to being the business”. In other words, technology spending shifts from a cost of operations (selling, general and administrative – SGA) to a cost of revenue (COR), or cost of goods sold (COGS). Lovelock further added it is a balancing act for Chief Information Officers (CIOs) to save cash while expanding revenue.

The Gartner IT Symposium/Xpo EMEA provided macroeconomic trends affecting the IT market in EMEA on November 8-11, 2021. Enterprise software spending is expected to have the highest growth rate in EMEA in 2022, driven by an increase in cloud spending (12.5% of total enterprise IT spending in 2022). According to Gartner, CIOs seeking to ensure maximum value from their IT investments will increase the use of cloud alternatives.

Table 1. EMEA - IT Spending Forecast (Millions of U.S. Dollars)(Source:Gartner)

 

2020 Spending

2020 Growth (%)

2021 Spending

2021 Growth (%)

2022 Spending

2022 Growth (%)

Data Center Systems

36,194

-5.8

38,975

2.2

40,464

3.6

Enterprise Software

138,624

6.7

161,472

9.7

178,259

10.0

Devices

173,608

-3.5

206,385

13.7

207,942

0.7

IT Services

311,600

-1.0

357,482

7.8

388,554

8.2

Communications Services

433,647

0.9

455,688

1.5

464,916

2.0

Overall IT

1,093,672

0.07

1,220,001

6.3

1,280,135

4.7

 

Two segments, infrastructure-as-a-service (IaaS) and desktop-as-a-service (DaaS) are areas where EMEA firms will increase spending in 2022 according to Gartner. Digital business continues to evolve long term, particularly in enterprise application software, infrastructure software, managed services, and cloud infrastructure services.

The table illustrates spending growth on devices of 0.7%, indicating a mixture of devices such as PCs, tablets, laptops and cellular phones fulfilling the needs of the flexible workforce. Lovelock continued to express how remote work, education and health contribute to the increase in IT spending in government and education. In addition, the report adds that IT spending is expected to increase by $14.4 billion in 2022.

Reports by Gartner indicate spending on devices in Germany are forecast to increase by 18% in 2021, realizing $24.2 billion in 2022. Firms in Germany aim to focus their spending on devices to meet the speed of remote work and virtual education.

For more detailed analysis on the outlook for global IT spending, please see the Gartner webinar: "IT Spending Forecast, 3Q21 Update: Help Employees and Customers Stay Connected.”

Below are upcoming dates and locations for Gartner IT Symposium/Xpo:

November 16-18| Japan | Virtual

November 30-December 2 | India | Virtual

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