Global IT govt spending to reach $550bn in 2022: Report
Growth will be driven by expenditure on software, IT services, and data centers
Digital technology spending by governments is set to increase by 6.5 percent next year as states repurpose their services in the wake of the pandemic, according to a leading IT advisory firm.
Gartner Inc., a research and advisory company based in the US, estimates the growth will be driven by expenditure on software, IT services, and data centers, leading to a global spend of SR2,090 billion ($557.3billion) in 2022.
Spending on devices, which is set to rise 17.6 percent this year, is predicted to fall by 1.6 percent in 12 months to December 2022.
Irma Fabular, research vice president at Gartner, said: “Governments will continue to accelerate investments in digital technologies to respond and recover from the continuing evolution of public health uncertainties due to the COVID-19 pandemic.
“The disruptions caused by the pandemic have also reinforced a key digital government tenet, that is public policy and technology are inseparable.”
Fabular added that the rapid move to virtual workspaces means governments are “rethinking their public cloud strategies to accelerate IT modernization, improve efficiencies and increase data security.”
Gartner believes that 64 percent of all IT spending by governments will be focused on services and software to improve responsiveness and resilience of public service, including investments in enhancing customer and employee experience, strengthening analytical capabilities and scaling operational agility.
Artificial intelligence
Artificial intelligence spending is set to skyrocket over the next four years, with businesses investing more than SR769 billion ($204 billion) per annum in the technology by 2025, according to a market intelligence company.
Analysis by the International Data Corp. estimates the amount spent on AI will rise by almost 140 percent, up from $85.3 billion in 2021. Retail and banking are set to lead the way, with AI being used to improve customer service facilities for shoppers, and detect threats and fraud in financial services.
Ritu Jyoti, group vice president at IDC’s Artificial Intelligence and Automation Research section, claimed the global pandemic has served as a “catalyst for innovation, growth, and business transformations.” According to the IDC’s Worldwide Artificial Intelligence Spending Guide, the two areas of biggest spend across all industries are automated customer service agents and sales process recommendation and automation.
These will account for $15.9 billion or more than 18 percent of all AI spending this year, IDC estimates.
Governments will continue to accelerate investments in digital technologies to respond and recover from the continuing evolution of public health uncertainties due to the COVID-19 pandemic.
Irma Fabular
Research VP, Gartner Inc.