TEAM International highlights the key forecasts of Gartner to the future increase in the global IT spending and new technologies that are likely to emerge in the IT business in the next years.

According to Gartner, Inc., the leading information technology research and advisory group, in 2008 the international IT spending will increase by 8 percent (compared to 2007) to reach USD 3.4 trillion in spite of current macroeconomic uncertainty. Gartner analysts claim this increase will be due to the instability and decline of the US Dollar rate. Although Gartner specialists are willing to concede that the world will experience reduced growth of the IT market shares, they are certain that the fundamentals of the IT business will remain strong. This trend will in part be based on emerging new regions (Eastern Europe), global replacement of out-of-date technologies and systems and significant technology shifts.

Unlike other industries that are dependent to a great extend on the products, IT market spending is dominated by services, which currently account for 70 percent of the total IT market spending. In the near future, the increase in IT market spending will be driven by two major factors: (1) business investing in internal processes’ improvement and optimization (cost reduction, strive for innovation etc) and (2) enhanced globalization that will allow IT services providers to lower the risk of demand decrease by integrating in more markets.

Gartner’s situational assessment suggests that the United States have marginally increased forecasts in regards to the growth in future hardware spending. At the same time, Western Europe is considered to have significantly increased forecasts about the hardware spending. The weakening US dollar dictates the growth in the dollar terms, which comes to be the major factor of significant market growth outside of the United States. In view of this, core outsourcing of IT processes is expected to stay the highest growth area in the IT market.

As determined by Gartner, in 2008 core IT outsourcing services represent 42 percent of the global IT services end-user spending. BPO is expected to attract more companies in the near future, since process management outsourcing is supposed to be viewed as an effective remedy for cost control in a short run.

In its report “Hype Cycle for Emerging Technologies, 2008” Gartner identifies 27 technologies that are likely to become most frequently used in the future. It is suggested that these technologies be paid special attention to by the outsourcing services providers in the next 10 years. This Hype Cycle has the following technologies and trends at its peak:

Green IT – greater focus will be placed upon production of environmentally friendly hardware and integration of industry environmental initiatives into software development.

Social computing platforms – these cyber environments will be used by most of IT companies to expand a range of developers to build on the basic application.

Video telepresence – although currently associated with high cost of implementation, this high-end video conferencing technology is anticipated to catch on in 2 to 5 years.

Microblogging – this addition to the social networking technology, consisting in posting very short introductory messages, is expected to add significant value to expansion of online communities and social media channels.

Cloud computing – organizations will switch from company-owned hardware and software assets to per-use service-based models.

Among trends and technologies that are likely to emerge in five to ten years Gartner lists 3-D printing, surface computers, behavioral economics and others (see Fig. below for more details). Gartner predicts that augmented reality and mobile robots are the technologies that will emerge not earlier than in ten years.

Summarizing the above predictions, TEAM International notes that the development of innovative IT technologies and trends will subsequently make outsourcing services providers to reconsider their strategies and to renovate their resource pool to be able to flexibly adapt to the market changes.

Fig. Gartner’s Hype Cycle for Emerging Technologies.