Now, let’s hit the spending data.
Canalys predicts a 6.2% growth in worldwide IT spending in 2024, reaching $4.94 trillion. Despite various challenges, channel partners are expected to play a crucial role, accounting for 73.2% of the IT market. Market trends to watch include the revival of the PC market, increased investment in AI-capable servers, cybersecurity remaining a priority, thriving demand for managed IT services, rising commitments to cloud infrastructure services, and AI becoming a standard feature.
Global cloud spending is projected to increase by 20% in 2024, driven by enterprise migration plans and the adoption of generative AI. Canalys reports a 19% YoY growth rate in Q4 2023, with total spending reaching $78.1 billion. The influence of enterprise IT optimization is fading, leading to increased commitments with hyperscalers. Cloud migration projects and investment in generative AI also contribute to the surge in cloud spending.
According to a report by Jon Peddie Research, desktop GPU shipments grew by 32% year over year in Q4 2023, reaching 9.5 million units. The growth is attributed to improved availability and lower prices rather than the emergence of AI PCs. AMD saw the greatest growth during the holiday quarter, gaining market share from Nvidia. Intel’s market share remained at 1%, but its upcoming Battlemage GPUs are expected to be released later this year.
The Q4 2023 Channel Futures Market Outlook survey says MSPs are projecting strong revenue growth for 2024, with a majority reporting year-over-year revenue and recurring revenue growth in Q4 2023. AI, security, and cloud are key expansion areas for MSPs, with AI-related solutions and cloud solutions driving revenue growth. However, finding new clients remains challenging for MSPs, with customer expansion and sales identified as top obstacles.
An IDC study provides an updated forecast for the managed print and document services and basic print services market from 2023 to 2027. The growth in the SMB market is driven by factors such as flexible work policies and the adoption of cloud, IoT, mobility, and security technologies. Print is expected to transition to a print-as-a-service model, and vendors and channel partners need to offer tailored print services to meet specific customer needs.
According to the Logicalis 2024 CIO Report, AI, digital transformation, and cybersecurity are the top priorities for tech leaders. The report reveals that 85% of organizations are investing in AI technologies, and 83% of CIOs experienced a severe cyber-attack in the past year. CIOs face barriers to implementing digital transformation, such as a lack of skills and digital vision. Connectivity infrastructure, including Private 5G and IoT initiatives, is recognized as essential for innovative growth. The report emphasizes the need for CIOs to balance innovation and growth with protecting their organizations from evolving digital threats.
CEOs’ economic outlook is surging, with expectations of stronger sales and capital investments. The Business Roundtable’s quarterly gauge of CEO sentiment is above its historical average, indicating a fading economic uneasiness. Concerns about regulations and the impact of climate risk disclosure are noted. The Job Openings and Labor Turnover Survey shows steady job openings, hirings, and separations, aligning with the Fed’s goal of a cooler but healthy labor market.
So, IT spending itself growing, with big surges in cloud and GPUs, which is a proxy for AI. And attitudes are positive.
There’s one quote from that print research I want to highlight. “The SMB market is less impacted by the ongoing issues around return to work and a transition to flexible work policies. At the same time, most SMB customers are first-time adopters of MPDS and print management.”
Is this a new market? Maybe – I’m skeptical, but it’s my job to be skeptical.