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Wall Street Beat: Forecasts call for tech to trend upward this year

Marc Ferranti | Jan. 13, 2014
Spending increases are forecast for software, smartphones and tablets.

The main IT trends of 2013 are still essentially in place, according to Bartels. In short, "Software leads, hardware slips, and services follow software," Bartels wrote.

"Business and government purchases of software will post the fastest 2014 growth (7.8% in US dollars, 7.1% in local currency terms) of any tech category, followed by IT consulting and systems integration services (7.3% in US dollars, 6.6% in local currencies)," Bartels wrote. "Computer equipment will lag, with only tablets posting strong growth, though laptops and other PCs will see a modest recovery."

On its part, Gartner forecasts that global spending on IT and telecom products and services will increase 3.1 percent year over year, compared to only 0.4 percent in 2013. The figure is much different from Forrester's because Gartner also includes telecom products.

Worldwide spending for IT and telecom will total US$3.8 trillion, Gartner said. Like Forrester, Gartner said that much of the growth will be driven by enterprise software.

The biggest disappointment for the IT market in 2013 was the decline in PC shipments. Both IDC and Gartner reported this week that PC shipments plunged by about 10 percent.

"Total shipments have now declined for seven consecutive quarters, and even the holiday shopping season was unable to inspire a turn in consumer spending," wrote IDC analyst Loren Loverde in the market researcher's report.

However, the consensus among market researchers is that the PC market's decline will slow this year.

"Although U.S. growth slipped a little in the fourth quarter, other regions all improved, reinforcing our view that growth rates will continue to improve gradually during 2014 despite remaining in negative territory," Loverde said.

On its part, Gartner forecasts that PC shipments will decline 7 percent to 277.94 million units this year.

Meanwhile, tablet shipments will increase from 179.5 million to 263.5 million units and mobile phone shipments will rise from 1.8 billion to 1.9 billion units, Gartner said. While the increase in mobile phone units doesn't seem big, just about every mobile market analyst agrees that smartphone shipments will rise at a faster rate than the overall phone market.

Earnings reports from major vendors, meanwhile, are due to start appearing in a few weeks, and the ensuing flood of data will help give a better sense of what's in store for the rest of the year.

 

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