Gartner predicts 5% IT spending growth in Thailand

Gartner predicts 5% IT spending growth in Thailand

Home-based study, work to spur reversal

The pandemic resulted in a contraction of almost 5% in Thailand's IT spending in 2020, but it is forecast to bounce back to a 5% growth this year, propelled by people working from home and studying online, says global leading tech research firm Gartner in a report.

In 2020, IT spending in the country fell 4.9% year-on-year to 636.2 billion baht.

Devices saw the biggest year-on-year drop of 14.5%, compared with other IT sectors, to 161.7 billion baht, followed by IT services with a 3.5% fall to 60.1 billion baht, data centre systems with a 1.1% decline to 24.8 billion baht, communications services with a 0.9% dip to 349.2 billion baht.

Only enterprise software saw growth with a 0.4% rise to 40.4 billion baht.

IT spending in Thailand is expected to recover and grow 5% this year to 668.2 billion baht. The biggest rebound is forecast for enterprise software spending with a 13.6% jump to 45.9 billion baht as remote work support is expanded and improved.

Remote work and remote education are also driving demand for tablets and laptops, which is expected to boost growth in device spending by 9.5% to 176.9 billion baht this year.

In 2022, IT spending in Thailand is projected to continue to grow with a rise of 5.3% to 703.5 billion baht. Enterprise software is forecast to see the biggest growth with an 8.9% surge to 50 billion baht, followed by devices with a 5.8% rise to 187.3 billion baht.

The expected rebound of the IT market in Thailand in 2021 falls short of projected growth in global IT spending, which is forecast to see 6.2% growth to US$3.92 trillion.

Last year, global IT spending declined 3.2% year-on-year to $3.6 trillion while chief information officers (CIOs) around the world prioritised spending on technology and services deemed "mission-critical during the initial stage of the pandemic".

"CIOs have a balancing act to perform in 2021 -- saving cash and expanding IT," said John-David Lovelock, distinguished research vice-president at Gartner.

"With the economy returning to a level of certainty, companies are investing in IT in a manner consistent with their expectations for growth, not their current revenue levels. Digital business, led by projects with a short time to value, will get more money and board level attention going into 2021."

All IT spending segments worldwide are forecast to return to growth in 2021, particularly enterprise software, which is expected to see the strongest rebound with 8.8% growth to $505 billion as remote work environments are expanded and improved.

The devices segment will see the second-highest growth in 2021 with a jump of 8% and is projected to reach $705.4 billion in spending.

"There are a combination of factors pushing the devices market higher," said Mr Lovelock. "As countries continue remote education through this year, there will be a demand for tablets and laptops for students. Likewise, enterprises are industrialising remote work for employees as quarantine measures keep employees at home and budget stabilisation allows CIOs to reinvest in assets that were sweated in 2020."

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