UK leading the way in 4.2 per cent European ICT spending growth - IDC

Despite recession fears, ICT spend in Europe is predicted to reach $1.2tn in 2023

ICT spending in Europe is set to grow 4.2 per cent year on year and reach $1.2tn in 2023.

According to IDC's Worldwide ICT Spending Guide: Enterprise and SMB by Industry, spend will then surpass $1.4tn by 2026, posting a 5.4 per cent compound annual growth rate (CAGR) over the 2021-2026 period.

The UK and Scandinavian countries will be amongst the main drivers of this growth, accoring ot the analysts.

Meanwhile, Russian ICT spend is forecast to shrink by 9.4 per cent year on year, due to EU sanctions.

"While organisations in most countries are anticipating a recession this year, the outlook for European ICT spending remains positive," said 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."

The report found that 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.

In their study, IDC found the device market to be suffering from the declining purchasing power of consumers, supply chain constraints, and cost-saving measures among enterprises. Device spending is set to decline by 2.2 per cent in 2023.

However, investments in IT and business services, telecom services and hardware will continue to grow.

Where is IT services spend forecast to grow?

Banking and 'discrete' manufacturing( the production of distinct units, such as a device rather than oil and gas) are set to be the areas with the highest ICT spending, right after the consumer sector. Their combined market value is said to reach over $210bn.

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 personalised 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).