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Aussie IT spending 'strongest in a decade,’ to reach $109B in 2022

Aussie IT spending 'strongest in a decade,’ to reach $109B in 2022

Local growth pace of 6.5 per cent outstrips global forecast, according to Gartner.

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Australia's IT spending is showing "its strongest growth in a decade" as it's predicted to hit $109 billion in 2022. 

According to the latest forecast by market analyst firm Gartner, the nation's IT spending is set to rise by 6.5 per cent next year, a marginal increase of just 0.1 per cent over 2021, but an entire percentage point higher than the global trend. 

Broken down, IT services is set to form the lion's share of spending in 2022, particularly in consulting services, which is expected to grow from $7.4 billion last year to reach $10.5 billion in 2025. 

Spending growth on devices (primarily PCs and tablets) reached a peak of 9 per cent in 2021 as remote work and learning took hold amid the COVID-19 pandemic. 

In 2022, this growth is expected to soften to 4.5 per cent, but still remain "elevated" as enterprises upgrade devices or invest in multiple devices for remote or hybrid work settings.  

According to John-David Lovelock, distinguished research vice president at Gartner, business spending, rather than consumer spending, is driving Australia's growth, while the falling US dollar has also "provided currency tailwinds”. 

"Organisations are entering a new build phase as they accelerate the shift to digital business,” said Lovelock. “There’s a lot more to do and less time to do it, and they need consulting services to help them get it done in time.”

Meanwhile, enterprise software is forecast to show the highest growth in 2022, with an increase of 14.2 per cent from 2021, with both vertical-specific and general enterprise application software forecast to grow strongly in 2022 as the economy rebounds. 

Elsewhere, data centre systems growth is expected to pick up pace following an 8.1 per cent growth decline in 2020. By 2022, growth should be back on track to 3.7 per cent, hitting $2.8 billion. 

Communications services will also bounce back from its decline over the past two years. According to Gartner, spending will now increase to 0.1 per cent, as opposed to –0.4 per cent in 2021, hitting $23.8 billion in 2022.  

“What changed in 2020 and 2021 was not really the technology itself, but people’s willingness and eagerness to adopt it and use it in different ways,” added Lovelock. “In 2022, CIOs need to reconfigure how work is done by embracing business composability and the technologies that support it.”  

On a global level, IT spending is projected to total US$4.5 trillion in 2022, an increase of 5.5 per cent from 2021. 

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