IT spending worldwide will rebound next year. Ransomware downtime is now way more expensive than the ransoms themselves. And cloud providers are poised to make their own AI chipsets.
These are the latest insights from leading IT market watchers. And here’s your tech provider’s roundup.
IT spending to rise next year
IT spending around the world is set to rise by only 0.4% this year, but will rebound next year, increasing 3.7% to $3.87 trillion, predicts Gartner.
This year’s slowdown is due to corporate concerns over a possible recession, the ongoing “tariff war,” and cutbacks on discretionary spending, the research firm says.
By sector, devices will see the biggest drop this year, Gartner predicts, with sales falling by more than 5%. The sector should return to growth next year, however, with sales predicted to rise by about 1%.
The biggest increase by sector will come from enterprise software. Gartner predicts these sales to rise this year by nearly 9%, then rise again next year by nearly 11%.
The cloud spending outlook is complicated. On the one hand, many nations that have lagged in cloud spending, including China, are now attempting to catch up. On the other, cloud-investing organizations are trying to figure out how to operate as both a traditional company and a technology company. “These ‘and’ dilemmas,” says Gartner researcher David Lovelock, “will drive future IT spending trends.”
Downtime due to ransomware gets worse
Ransomware attacks are on the rise, and the cost of related downtime is getting higher.
So finds a new survey of more than 1,400 managed service providers (MSPs) that manage IT systems for small and midsized business (SMB) customers. The survey was conducted by Datto, a provider of IT solutions to the channel.
The findings include:
> A large majority (85%) of the MSPs say their SMB customers suffered a ransomware attack in the last 2 years. That’s up from the 79% who said the same last year.
> Although most (89%) of the MSPs say their SMB customers should be very concerned about ransomware, fewer than a third (28%) say their customers actually are concerned.
> The average cost of downtime from a ransomware attack is now reported at $141,000. That’s more than 3 times higher than the average cost reported last year, which was $46,800. It’s also way more than the average ransom requested by attackers, which was just $5,900.
Cloud providers make AI CPUs, too
Cloud service providers refuse to stay in their lane. Alibaba, Amazon, Facebook, Google, Huawei and Tencent not only offer cloud services, but also are developing their own in-house chipsets for artificial intelligence (AI) workloads in their data centers.
Research firm ABI Research predicts these companies will collectively produce a total of 300,000 AI chips by 2024, accounting for nearly 1 in every 5 AI chipsets shipped that year.
What’s more, between now and 2024, worldwide revenue from AI chipset shipments will more than double, ABI predicts, rising from $4.2 billion to $10 billion.
ABI is not predicting that the CSPs will bump established chipmakers from their roosts. On the contrary, it expects Intel, Nvidia and Xilinx to continue dominating the business. But they will face increasing competition from Alibaba, Amazon et al.
From the CSPs’ perspective, building their own chipsets offers several advantages. These include better hardware-software integration, a better fit with specific AI networks, and a way to differentiate themselves with end-to-end AI hardware solutions.
ABI analyst Lian Jye Su adds: “This further expands the footprint of the cloud AI service providers.”