"Price pressure based on increased competition, lack of product differentiation and the increased availability of viable alternative solutions has had a dampening effect on the short term IT spending outlook," says Gartner's Richard Gordon.
Gartner now expects global IT spending to rise only 2.1% in 2014 to $3.75B. That's down from a prior forecast for 3.2% growth, albeit still better than the flat growth seen in 2013. For now, Gartner expects growth to accelerate to 3.7% in 2015.
Device sales (inc. PCs, mobile devices, and printers) are only expected to grow 1.2% in 2014, as PC sales continue declining and ASP drops affect smartphone/tablet revenue.
Enterprise software sales are expected to be relatively healthy, growing 6.9% to $321B. Within the market, demand for databases and other types of infrastructure software is expected to hold up better than application demand, which has been dinged by weak PC sales and cloud competition.