April 7, 2016 / 7:42 AM / in 2 years

IT spending could be a casualty of economic uncertainty: Gartner

(Reuters) - Worldwide spending on information technology could become one of the casualties of global economic uncertainty this year, according to research firm Gartner Inc.

A woman uses a computer keyboard in this photo illustration taken in Sydney June 23, 2011. REUTERS/Tim Wimborne

Worldwide IT spending is expected to fall slightly this year to $3.49 trillion, as the strong U.S. dollar continues to take its toll, the firm said on Thursday.

The global uncertainty is making organizations “tighten their belts”.

Investing in digital businesses and services at a time when revenue growth does not support IT spending is forcing organizations to cut costs, Gartner said.

In constant currency, Gartner predicts a 1.6 percent growth rate in IT spending this year, compared with 2.4 percent a year earlier.

The problem is U.S.-based multi-nationals can’t make as much money, even there is a global increase in IT activity, John-David Lovelock, research vice president at Gartner said in an interview.

Networking giant Cisco Systems Inc said in February that it was weathering a global slowdown in information-technology spending. Analysts at the time said that Cisco’s warning could be a bad sign for some technology companies.

Spending on devices like PCs, mobile phones, tablets and printers is also expected to decline 3.7 percent to $626 billion, Gartner said, due to the global saturation in the smartphone and PC markets.

Reporting by Narottam Medhora and Anya George Thakaran in Bengaluru; Editing by Maju Samuel

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