Australia is expected to spend $103 billion on IT and software in 2021 as more and more CEOs look to invest in their business’ digital infrastructure.

Data from research firm Gartner shows this increase (up 6.4% compared with the previous year) will be driven predominantly by IT services spending – expected to reach $37 billion this year.

That would mark a 4.9% increase in this segment, more than doubling the 2.3% growth achieved in 2020. 

While that acceleration is no doubt impressive, it pales in comparison to software spending, which Gartner expects spending will grow by 13.3% to hit $23 billion by years’ end.

Spending on devices is also tipped to grow 12.7% to $16.4 billion, as the working from home revolution continues to play out.

Notably, the report also found IT and software spending is accelerating ahead of revenue growth, suggesting businesses are willing to stump up the cash for technology which has strong links to business outcomes.

Gartner research vice president John-David Lovelock said this pointed to technology spending entering a “new build budget phase”.

“CIOs are looking for partners who can think past the digital sprints of 2020 and be more intentional in their digital transformation efforts in 2021,” he said.

“This means building technologies and services that don’t yet exist, and further differentiating their organisation in an already crowded market.”

Globally, Gartner expects the IT services market to reach US $1.2 trillion in 2021, marking a 9.8% increase on the previous year.

Sources:

• ARN: Australian IT spending to grow by 6.4% to $103B