Tech spend forecast cut

Industry research firm Gartner trimmed its tech spending outlook for 2013 because concerns about the U.S. budget and Cyprus’ debt burden are expected to temporarily weigh on financial plans.

It now expects spending on information technology ranging from smartphones to data storage to grow 4.1 percent or $3.8 trillion this year instead of the previously forecast 4.2 percent, Gartner said on Thursday.

By comparison in 2012, IT spending rose 2.1 percent.

The research firm said it had changed its forecast because federal budget cuts in the United States and Cyprus’ debt issues had “netted out any benefit” from positive developments such as the U.S. avoiding the so-called fiscal cliff of tax hikes and deep spending reductions at the end of last year.

However, Gartner said, the concerns are expected to be short-lived.

“The market is already in a pessimistic state,” said Gartner analyst John Lovelock. “This hasn’t changed the dial much but there will likely be a pause in some spending.”

That could mean delaying the purchase of new mobile devices for example but it would not impact strategic initiatives such multi-year contracts or basic functions such as software and hardware maintenance.

In enterprise software Gartner expects spending to reach $297 billion, up 6.4 percent this year compared with 3.5 percent growth in 2012.

“There’s a big jump in certain base functionalities around data,” Lovelock said.

IT services, which can include outsourcing, maintenance or consulting, will see growth of 4.5 percent to $918 million versus 1.5 percent in 2012.

Worldwide devices spending — including PCs, tablets, mobile phones and printers — is forecast to reach $718 billion in 2013, up 7.9 percent from 2012

“Despite flat spending on PCs and a modest decline in spending on printers, a short-term boost to spending on premium mobile phones has driven an upward revision in the devices sector growth for 2013 from Gartner’s previous forecast of 6.3 percent,” the firm said.

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Tech spend forecast cut