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Gartner says Malaysian IT spending to reach RM65.2b in 2018
January 17, 2018 News AI analytics big data IoT


Technology products and services spending in Malaysia is forecasted to reach RM65.2 billion this year, up 5.7 per cent from 2017, while worldwide IT spending is projected to total US$3.7 trillion in 2018, an increase of 4.5 percent from last year.

According to Gartner Inc, a research and advisory firm, global IT spending growth began to turn around in 2017, with continued growth expected over the next few years.

“However, uncertainty looms as organisations consider the potential impacts of Brexit, currency fluctuations, and a possible global recession,” Gartner research vice president John-David Lovelock said.

Lovelock said despite this uncertainty, businesses will continue to invest in IT as they anticipate revenue growth, but their spending patterns will shift.

“Projects in digital business, blockchain, Internet of Things (IoT), and progression from big data to algorithms to machine learning to artificial intelligence (AI) will continue to be main drivers of growth,” he said.

Gartner said enterprise software continues to exhibit strong growth, with worldwide software spending projected to grow 9.5 percent in 2018, and it will grow another 8.4 percent in 2019 to total US$421 billion.

“Organisations are expected to increase spending on enterprise application software in 2018, with more of the budget shifting to software as a service (SaaS).

“The growing availability of SaaS-based solutions is encouraging new adoption and spending across many subcategories, such as financial management systems (FMS), human capital management (HCM) and analytic applications,” it said.

On the other hand, Gartner said the devices segment is expected to grow 5.6 percent in 2018.

In 2017, the devices segment experienced growth for the first time in two years with an increase of 5.7 percent.

“End-user spending on mobile phones is expected to increase marginally as average selling prices continue to creep upward even as unit sales are forecast to be lower.

“PC growth is expected to be flat in 2018 even as continued Windows 10 migration is expected to drive positive growth in the business market in China, Latin America and Eastern Europe.

“The impact of the iPhone 8 and iPhone X was minimal in 2017, as expected. However, iOS shipments are expected to grow 9.1 per cent in 2018,” it said.

Lovelock said Gartner forecasts US$2.9 trillion in new business value opportunities attributable to artificial intelligence (AI) by 2021, as well as the ability to recover 6.2 billion hours of worker productivity.

“That business value is attributable to using AI to, for example, drive efficiency gains, create insights that personalize the customer experience, entice engagement and commerce, and aid in expanding revenue-generating opportunities as part of new business models driven by the insights from data.

“Capturing the potential business value will require spending, especially when seeking the more near-term cost savings.

“Spending on AI for customer experience and revenue generation will likely benefit from AI being a force multiplier — the cost to implement will be exceeded by the positive network effects and resulting increase in revenue,” he said.

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