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Editor’s Note: Provided below are extracts from a Gartner, Inc., press release on Global IT spending and a commentary on that press release published in the Wall Street Journal. The combined extracts highlight the positive trajectory of enterprise software spending between 2017 and 2018 and share that one of the reasons for the enterprise software spend growth is the move toward software-as-a-service delivery models. This spending trend appears to be reflected in the growth forecasts for off-premise (SaaS) enterprise eDiscovery software offerings and the corresponding trajectory changes in demand for on-premise enterprise eDiscovery software offerings.


Extract from Press Announcement by Gartner, Inc.

Gartner Says Global IT Spending to Grow 6.2 Percent in 2018

Worldwide IT spending is projected to total $3.7 trillion in 2018, an increase of 6.2 percent from 2017, according to the latest forecast by Gartner, Inc.

“Although global IT spending is forecast to grow 6.2 percent this year, the declining U.S. dollar has caused currency tailwinds, which are the main reason for this strong growth,” said John-David Lovelock, research vice president at Gartner. “This is the highest annual growth rate that Gartner has forecast since 2007 and would be a sign of a new cycle of IT growth. However, spending on IT around the world is growing at expected levels and is in line with expected global economic growth. Through 2018 and 2019, the U.S. dollar is expected to trend stronger while enduring tremendous volatility due to the uncertain political environment, the North American Free Trade Agreement renegotiation and the potential for trade wars.”

Enterprise software spending is forecast to experience the highest growth in 2018 with an 11.1 percent increase (see Table 1). Barring unexpected disruption, the software industry is expected to continue capitalizing on the evolution of digital business. Application software spending is expected to continue to rise through 2019, and infrastructure software will also continue to grow, bolstered by modernization initiatives.

Table 1. Worldwide IT Spending Forecast (Billions of U.S. Dollars)
2017 2017 2018 2018 2019 2019
Spending Growth (%) Spending Growth (%) Spending Growth (%)
Data Center Systems 181 6.3 188 3.7 190 1.1
Enterprise Software 352 8.8 391 11.1 424 8.4
Devices 663 5.1 706 6.6 715 1.3
IT Services 933 4.4 1,003 7.4 1,048 4.6
Communications Services 1,392 1.3 1,452 4.3 1,468 1.1
Overall IT 3,521 3.8 3,740 6.2 3,846 2.8
Source: Gartner (April 2018)

Read the complete press release at Gartner Says Global IT Spending to Grow 6.2 Percent in 2018


Extract from article by Sara Castellanos in The Wall Street Journal

IT Spending on Track for Biggest Gains in a Decade, Gartner Says

Spending on enterprise software is expected to reach $391 billion in 2018, representing an 11.1% increase over last year and the highest growth market in IT spending for 2018, according to the report, released Monday.

That’s largely due to the trend toward digital transformation and a change in the dynamics from an “ownership preference” to a “service preference,” Mr. [John-David] Lovelock said.

“Instead of owning a server, you’re getting compute as a service. Instead of having a phone line, you’re using (voice over internet services),” he said. “Everything is shifting to the digital twin alternative.”

The money enterprises used to spend on servers and hardware is now being spent on software-as-a-service, and companies now need fewer servers, backup, storage and networking equipment, Mr. Lovelock said. They’re also simplifying their network infrastructure with software instead of implementing large, complex systems, he said.

Read the complete article at IT Spending on Track for Biggest Gains in a Decade, Gartner Says


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