Software is catching the other three categories of IT spending over the last few years. I expect this to continue in 2018, when it will grow by 4.6% to reach $1.0 trillion. IT service (pushed upwards by the success of cloud computing) will reach $2.1 trillion (a 1.7% growth); hardware will do nearly as well, as it continues to benefit from the new processors and raw storage offerings launched in 2017 – it will grow by 1.6% to reach $1.4 trillion. Even telecom service, which has faltered in many of the last few years, will grow – albeit by less than the other categories – by 0.8% to $2.2 trillion.
In 2018 we will see little growth in the largest ITC offerings (see the line of large bubbles across the bottom in my Figure). Cloud computing has been driving a mass centralising of enterprise computing since its inception. I’m proud of the fact that I was the first analyst to talk about its potential back in 2008 when still at IDC and writing about in hundreds of research posts here at ITCandor since. This year the three strongest growing offerings will be SaaS (34% to $140 billion, but don’t forget that it is natural for all software suppliers to make their products available as online ‘services’), IaaS (28% to $66 billion) and PaaS (23% to $32 billion). The strongest non-cloud offerings will be operating systems, which will need to updated in the year to keep up with the technical advances in processor design and gaming consoles which have been revitalised following the success of Nintendo’s Switch, both up 15% to $66 billion and $21 billion respectively.
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