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New Delhi: Technology researcher Gartner Inc. on Monday cut its growth forecast for global spending on information technology (IT) this year to 3.1%, from its earlier estimate of 3.5% growth, primarily as it sees lower spending on telecom services.

“A downward revision of the 2014 forecast growth in spending for telecom services—a segment that accounts for more than 40% of total IT spending—from 1.9% to 1.2% is the main reason behind this overall IT spending growth reduction," said Richard Gordon, managing vice-president, Gartner.

“A number of factors are involved, including the faster-than-expected growth of wireless-only households, declining voice rates in China, and a more frugal usage pattern among European customers. The latter coincides in Western Europe with a breakout of fierce price competition among communications service providers to retain customers and attract new ones," he added in the report.

Gartner expects global IT spending to reach $3.8 trillion this year. In 2013, the global IT market grew at 0.4% year on year, it said.

Spending on personal computers, ultra-mobile PCs, mobile phones and tablets, which contracted 1.2% in 2013, will grow 4.3% in 2014, Gartner said.

Enterprise software spending growth will continue to be the strongest at 6.8% in 2014, Gartner said.

“Investment is coming from exploiting analytics to make B2C (business to consumer) processes more efficient and improve customer marketing efforts. Investment will also be aligned to B2B (business to business) analytics, particularly in the SCM (supply chain management) space, where annual spending is expected to grow 10.6% in 2014," said Gordon. “The focus is on enhancing the customer experience throughout the pre-sales, sales and post sales processes."

Gartner also lowered its 2014 growth forecast for global spending on data centre systems to 2.6% from its earlier 2.9% estimate, mainly due to a reduction in the forecast for external controller-based storage and enterprise communications applications, it said. These segments represent 32% of the total end-user spending on data centre systems.

“Gartner has slightly revised downward the IT services compound annual growth rate between 2012 and 2017. The largest contributor to this revision comes from reductions in IT outsourcing—specifically, in colocation, hosting and data centre outsourcing growth rates," Gordon said.

“We are seeing CIOs (chief information officers) increasingly reconsidering data centre build-out and instead planning faster-than-expected moves to cloud computing. Despite these small reductions, we continue to anticipate consistent four to 5% annual growth through 2017," he added.

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