IT spending trends point to an uptick in cloud and services spending, with inflation contributing to the increase. Read about the tech growth outlook.
Impact of Cloud Inflation on IT Spending
Cloud inflation is contributing to an increase in IT spending trends, particularly in cloud and services. Gartner forecasts a 13.8% growth rate in software spending and a 10.4% increase in IT services for 2024, with overall IT spending projected to reach $5.1 trillion, an 8% rise from 2023.
Generative AI's Role in IT Budgets
Generative AI has not yet had a significant impact on IT spending. Gartner indicates that very little IT spending will be allocated to generative AI in 2023 and 2024, with expectations for it to start influencing budgets in 2025.
Factors Driving Cloud Pricing
Several factors are driving cloud pricing, including higher wages, increased energy demands, and the introduction of generative AI services. The Producer Price Index reported a 3.1% year-over-year increase for data processing and related services, highlighting the ongoing inflationary pressures in the cloud sector.
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