The COVID 19, or coronavirus, crisis is hitting IT markets hard, with buyers planning to sharply reduce their spending, according to a new IT spending forecast from International Data Corp. (IDC).
Based on first quarter indicators, the research firm expects to see a significant slowdown in spending on hardware in particular during the first half of the year. Software and services spending will also be affected as the crisis reverberates through all sectors of the economy, including supply chains, trade and business planning.
By the end of the year, IT spending is expected to grow only a paltry 1% compared to the original forecast of more than 4% growth. IDC advised that these forecasts are more likely to trend down than up in the next few weeks.
Coronavirus IT Spending Impact
“The situation is extremely fluid,” said Stephen Minton, vice president in IDC’s Customer Insights and Analysis group, in a prepared statement. “Our monthly data and surveys are clearly pointing in one direction, but it’s still early to understand the full impact of the coronavirus crisis across all sectors of the economy. We are using scenario models to illustrate that forecasts have a wider range than usual, and the downside risks in those models seem to be increasing every day. But the duration of the crisis remains a big unknown and will go a long way in determining overall market growth for the year as a whole.”
The research firm has yet to revise its forecast for cybersecurity spending, which, as Telecompetitor reported, was expected to grow sharply in the next few years.