CORRECTING and REPLACING Gartner Says Canadian IT Spending to Grow 1.1% in 2019

Analysts Discuss the Outlook for the Canadian IT Market During Gartner IT Symposium/Xpo 2019, June 3-6, in Toronto

CORRECTION...by Gartner, Inc.

TORONTO--()--In first sentence of release, figure should read $87.8 billion (instead of $87.8 million).

The corrected release reads:

GARTNER SAYS CANADIAN IT SPENDING TO GROW 1.1% IN 2019

Analysts Discuss the Outlook for the Canadian IT Market During Gartner IT Symposium/Xpo 2019, June 3-6, in Toronto

Canadian IT spending is projected to total $87.8 billion in 2019, an increase of 1.1% year over year, according to the latest forecast by Gartner, Inc. This is down from 3.5% growth in 2018. Global IT spending is also forecast to grow 1.1% in 2019, reaching $3.79 trillion.

“Uncertain economic and political environments and trade wars are slowing growth in IT spending in Canada in 2019,” said John-David Lovelock, research vice president at Gartner. “Specifically, steel and aluminum tariffs, uncertainty around car manufacturing, continuing problems in the country’s oil industry and indecision around the pending trade deal to replace the North American Free Trade Agreement (NAFTA) are some of the impacts affecting IT spending. However, we expect some of that uncertainty to be resolved by 2020 and IT spending is expected to pick up.”

Gartner analysts are discussing the emerging trends that are driving digital transformation and IT spending this week during Gartner IT Symposium/Xpo here through Thursday.

Although Canadian organizations are not as far along in their digital journey as their global counterparts, their use of cloud services is only second to the U.S. “We are seeing an increased investment in off-premises capabilities and decreased investment in on-premises capabilities,” said Mr. Lovelock.

This is reflected in the flat growth for data center systems in 2019 and the strong growth for enterprise software in 2019 and 2020 (see Table 1). The largest cloud shift has so far occurred in application software and that segment is poised for continued strong growth. Gartner also expects increased growth for the infrastructure software segment over the forecast period.

Table 1. Canadian IT Spending Forecast (Millions of U.S. Dollars)

    2018

Spending

  2018

Growth (%)

  2019

Spending

  2019

Growth (%)

 

2020
Spending

 

2020
Growth (%)

Data Center Systems   4,963   7.3   4,966   0.0   4,892   -1.4
Enterprise Software   13,020   15.0   13,867   6.5   15,065   8.6
Devices   11,266   -5.4   11,238   -0.2   10,975   -2.3
IT Services   24,560   4.7   25,019   1.8   26,129   4.4
Communications Services   34,023   1.5   33,704   -0.9   34,177   1.4
Overall IT   87,833   3.5   88,763   1.1   91,238   2.8

Source: Gartner (June 2019)

“The choices CIOs make about technology investments are essential to the success of digital business. Disruptive emerging technologies, such as artificial intelligence (AI), will reshape business models as well as the economics of public- and private-sector enterprises. Investment in AI, for example, has experienced a huge jump from 2018, and AI will have a major effect on IT spending,” said Mr. Lovelock. “Gartner’s 2019 CIO Agenda Survey showed that 24% of Canadian CIOs plan to increase investment in AI, up from 2% in 2018. Additionally, Gartner’s AI business value forecast predicts that Canadian organizations will receive $36 billion worth of benefit from the use of AI this year alone.”

More detailed analysis on the outlook for the IT industry is available in the complimentary webinar “IT Spending Forecast, 1Q19 Update: AI — Use it, Build it or Sell it.”

Gartner’s IT spending forecast methodology relies heavily on rigorous analysis of sales by thousands of vendors across the entire range of IT products and services. Gartner uses primary research techniques, complemented by secondary research sources, to build a comprehensive database of market size data on which to base its forecast.

The Gartner quarterly IT spending forecast delivers a unique perspective on IT spending across the hardware, software, IT services and telecommunications segments. These reports help Gartner clients understand market opportunities and challenges. The most recent IT spending forecast research is available to Gartner clients in “Gartner Market Databook, 1Q19 Update.” This quarterly IT Spending Forecast page includes links to the latest IT spending reports, webinars, blog posts and press releases.

About Gartner IT Symposium/Xpo

Gartner IT Symposium/Xpo is the world's most important gathering of CIOs and senior IT leaders, uniting a global community of CIOs with the tools and strategies to help them lead the next generation of IT and achieve business outcomes. More than 25,000 CIOs, senior business and IT leaders worldwide will gather for the insights they need to ensure that their IT initiatives are key contributors to, and drivers of, their enterprise's success.

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Upcoming dates and locations for Gartner IT Symposium/Xpo include:
September 16-18: Cape Town, South Africa
October 20-24: Orlando
October 28-31: Gold Coast, Australia
October 28-31: Sao Paulo, Brazil
November 3-7: Barcelona
November 11-14: Goa
November 12-14: Tokyo

About Gartner

Gartner, Inc. (NYSE: IT) is the world’s leading research and advisory company and a member of the S&P 500. We equip business leaders with indispensable insights, advice and tools to achieve their mission-critical priorities and build the successful organizations of tomorrow.

Our unmatched combination of expert-led, practitioner-sourced and data-driven research steers clients toward the right decisions on the issues that matter most. We are a trusted advisor and objective resource for more than 15,000 organizations in more than 100 countries — across all major functions, in every industry and organization size.

To learn more about how we help decision makers fuel the future of business, visit www.gartner.com.

Contacts

Katie Costello
Gartner
+1 571 444 1091
katie.costello@gartner.com

Contacts

Katie Costello
Gartner
+1 571 444 1091
katie.costello@gartner.com