Publication date: 23 Feb 2023
European ICT Spending to Reach $1.2 Trillion This Year Despite Fear of Recession, Says IDC
Prague, February 23, 2023 — According to the International Data Corporation (IDC)’s Worldwide ICT Spending Guide: Enterprise and SMB by Industry, ICT spending in Europe will reach $1.2 trillion in 2023 and will surpass $1.4 trillion by 2026, posting a 5.4% compound annual growth rate (CAGR) over the 2021-2026 period.
Overall European ICT spending is forecast to grow by 4.2% year on year in 2023, driven by the Scandinavian countries and the United Kingdom. On the other hand, sanctions imposed by the EU and the growing number of companies leaving Russia will result in the Russian ICT market shrinking by 9.4% year on year.
“While organizations in most countries are anticipating a recession this year, the outlook for European ICT spending remains positive,” says Zsolt Simon, Senior Research Analyst at IDC. “They regard technology investments as a means of gaining a competitive edge, as well as providing solutions for many of the challenges arising in an extremely volatile market.”
Software will be the fastest-growing technology group on a year-on-year basis, and investments in cloud-first solutions will drive the overall technology market in Europe in 2023. Software has proven to be highly resilient to the storm of disruptions currently impacting the continent, supported by rapid growth in the adoption of artificial intelligence (AI) platforms and software quality and lifecycle tools, as well as application platforms, integration and orchestration middleware, and collaborative applications.
Despite inflationary pressures and economic recession in several European countries, investments in IT and business services, telecom services, and hardware will continue to increase as well. However, the device market has suffered from the declining purchasing power of consumers, supply chain constraints, and cost-saving measures among enterprises, which is expected to result in an overall decline in device spending of 2.2% in 2023.
The consumer sector will continue to be the largest source of ICT spending in 2025, representing almost 28% of total European ICT revenue, although year-on-year growth will remain below 1%, as the increasing cost of living is taking a toll on consumer purchases. Banking and discrete manufacturing will take the second and third positions, respectively, in the ranking of highest spending industries, accounting for a combined market value of over $210 billion. Entities in the banking sector will be focusing on accelerating automation to support core banking services, database management, and resource management. AI will be leveraged to offer more flexible and more personalized services for improved customer experiences. Manufacturing companies will invest in technologies to ensure cost-effective operations, handle increasing amount of data, and reduce pressure on staff through robotics and process automation robotic process automation (RPA).
About the IDC Worldwide ICT Spending Guide: Enterprise and SMB by Industry
The Worldwide ICT Spending Guide: Enterprise and SMB by Industry, previously known as the Worldwide Semiannual ICT Spending Guide by Industry and Company Size, is IDC's flagship all-in-one data product capturing IT spending across more than 100 technology categories and 53 countries. The guide provides a granular view of the market for IT spending from country, industry, company size, and technology perspectives. This comprehensive database, delivered via pivot table or IDC's custom query tool, enables users to easily extract meaningful information about various technology markets and industries by viewing data trends and relationships and making data comparisons across more than 3 million data points.
International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. With more than 1,100 analysts worldwide, IDC offers global, regional, and local expertise on technology and industry opportunities and trends in more than 110 countries. IDC's analysis and insight helps IT professionals, business executives, and the investment community to make fact-based technology decisions and to achieve their key business objectives. Founded in 1964, IDC is a wholly owned subsidiary of International Data Group (IDG), the world's leading tech media, data, and marketing services company. To learn more about IDC, visit www.idc.com. Follow IDC on Twitter at @IDC and LinkedIn. Subscribe to the IDC Blog for industry news and insights: http://bit.ly/IDCBlog_Subscribe.
Copy the following code into your site