Richard GordonGartner’s U.S. dollar growth forecast for global IT spending in 2012 has been revised downward from 4.6% in the previous quarter to 3.7%. Faltering global economic growth, the eurozone crisis and the impact of Thailand’s floods on hard-disc drive production have taken their toll on the outlook for IT spending this year.
The combination of private-sector deleveraging and public-sector austerity would, on their own, be enough to put the brakes on economic growth, but the lack of political leadership to resolve the fundamental sovereign debt issues, most notably the eurozone crisis, is causing huge uncertainty for businesses and consumers. Although no one can predict how the eurozone crisis will unfold, the scenarios range from bad to very bad to catastrophic, depending on the ability of politicians to craft effective short-term measures to support debt-laden countries and longer-term structural reform. In this environment we expect both businesses and consumers in Europe to be cautious in the coming months about spending on IT products and services.
To make matters worse, during the past quarter, a devastating flood left one-third of Thailand under water. Although the waters are receding, the magnitude of the disaster is only just beginning to strike home. Beyond the human tragedy, there are serious implications for businesses worldwide, particularly with computer and storage purchases. Thailand has been a major hub for hard-drive manufacturing, both for finished goods and components. Gartner’s current estimate is that the supply of hard drives will be reduced by as much as 25% (and possibly more) during the next six to nine months. Given the lead times involved in rebuilding the destroyed manufacturing facilities, the effects of this will continue to ripple throughout 2012, and possibly into 2013.
Large PC OEMs are best-positioned to cushion the effects of the shortages and will see fewer problems than others in the industry. These companies already had contracts in place and quickly responded to the potential disruptions, locking in a portion of the diminished supply in new multiple quarter contracts. However, no company will be immune to the effects on the HDD supply chain, and we have reduced our shipment forecast for PCs, which has impacted the short-term outlook for the hardware sector.
More details on Gartner’s global IT spending forecast can be found at:
www.gartner.com/quarterly-it-forecast
I am also hosting our upcoming Webinar on January 10th which will feature live analyst discussion on the issues and thinking behind the forecast – you can register here:
IT Spending Forecast Webinar, 4Q11 Update
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