India gearing up for a strong digital future

by CXOtoday News Desk    Oct 22, 2013


IT spending in India is projected to total $71.3 billion in 2014, a 5.9% increase from the $67.4 billion forecast for 2013, according to Gartner. What drives the growth is what Gartner calls “Nexus of Forces” which includes a confluence and integration of cloud, social collaboration, mobile and information. Mobility, cloud and social are among the top 10 Indian CIO priorities for 2013 and the trend will continue throughout 2014. As the Nexus of Forces gains acceptance, it will continue to drive enterprises and society toward a pervasively digital future and will drive a discussion between IT and business leaders to become more digital, says the Gartner research.

“The digital world is here and this result in every budget being an IT budget; every company being a technology company; every business is becoming a digital leader; and every person is becoming a technology company,” said Peter Sondergaard, senior VP at Gartner and global head of Research. “This is resulting in the beginning of an era: the Digital Industrial Economy, which will be built on the foundations of the Nexus of Forces and the Internet of Everything by combining the physical world and the virtual.”

To keep pace with this growth, the devices market will emerge as the largest segment of IT spend in India by 2017. Growth within this segment will be driven by the sale of mobile phones which will be amongst the fastest growing sub segments within the Indian IT industry. Mobile phone revenue will total $26 billion in 2017 and will account for 76.4 percent of device revenue and 28 percent of overall IT spend in India in the year 2017.

 “Mobile smart devices have taken over the technology world. By 2017, new device categories: mobile phones, tablets, and ultra-mobile PCs will represent more than 80 percent of device spending. Gartner also forecasts that by 2017, nearly half of first-time computer purchases will be a tablet. Mobile is the destination platform for all applications,” said Sondergaard.

The telecommunications services market which includes fixed and mobile, data and voice services will continue to be the largest IT segment in India with IT spending forecast to reach $30 billion in 2014. The devices market, which includes mobile phones, PCs, tablets and printers is expected to total $23.5 billion in 2014, a 6% increase from 2013. IT services will record the fastest growth amongst the various segments, and it is projected to grow 13% to reach $11.2 billion in 2014. Software will account for $4.1 billion in revenue.

The IT market in India is the third-largest among emerging economies and the fourth-largest among developing and mature Asia Pacific countries. Gartner researchers however believe that with the recent currency fluctuations Indian enterprises are exercising a cautious approach that will have a bearing on the overall performance of the industry. Nevertheless, the spending will continue to be moderate as enterprises demand on IT continues to increase.