Global IT spending in 2024 is expected to be slightly lower than originally anticipated due to the rising costs of investing in generative AI tools, according to experts. A recent report from Gartner has highlighted that the desire to adopt AI technologies, along with a general improvement in the tech industry, will impact IT spending worldwide.
The report forecasts that worldwide IT spending will reach $5.26 trillion in 2024, reflecting a 7.5% increase from the previous year. However, this growth rate is lower than the 8% initially projected, with a significant portion of the costs attributed to generative AI investments, especially in data center expenditures, which are expected to surge by 24% in 2024.
John-David Lovelock, a Distinguished VP Analyst at Gartner, emphasized that generative AI (GenAI) is influencing all technology sectors, although not all companies will benefit equally. While some software vendors may see revenue gains from selling GenAI add-ons, for others, it may resemble more of a financial burden akin to a tax.
In addition to the rise in AI-related expenses, Gartner predicts a 12.6% increase in software spending, a 5.4% rise in device investments, and a 7.1% growth in IT services spending. Although the projected increase in IT services spending is lower than initially estimated, Gartner attributes this adjustment to be a result of expected trends in the industry.
Lovelock noted that the fatigue observed among CIOs earlier in the year has subsided, leading to a clearance of contract backlogs dating back to the third quarter of 2023. As a result, Gartner anticipates a surge in IT investments towards the end of 2024 to compensate for the slow start experienced earlier in the year.
Furthermore, the tech industry is witnessing a push towards integrating AI capabilities into various tools and platforms, including Microsoft Excel spreadsheets. This advancement in AI technology is poised to enhance productivity and streamline operations for businesses across different sectors.
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