European IT Turnaround Begins

The European IT market will achieve minimal growth in 2015, following two years of revenue declines and low sales growth, according to a prediction by the European Information Technology Observatory (EITO). The results, published by Germany’s Bitkom, forecast 0.9% revenue growth, to €651 billion.

While IT hardware and, software and services will increase 2.1%, to €364 billion, the telecommunications revenues are expected to fall 0.6%, to €287 billion. Bitkom’s chief economist, Axel Pols, said that the modest IT market growth will be supported by “strong increasing investments in software, associated with the digital transformation of many companies”.

The IT markets of countries in southern Europe – those most affected by the financial crisis in the region – are of particular concern. EITO expects revenues to fall 3.5% in Greece, 2.1% in Italy and 2% in Portugal. This is likely to slow Europe’s overall return to growth.

Globally, EITO expects IT revenues to rise 3.1% this year, to €2.8 trillion. The telecommunications sector will grow above the average, to €1.6 trillion (rising 3.4%). IT growth will fall 2.8% (€1.2 billion).

In country terms, India will rise 9% (to €53 billion), Brazil 8.9% (to €118 billion) and China 6.9% (to €325 billion). The lowest IT market growth will be in Russia, which will fall 6.1% to €41 billion. The USA, with a market value of €800 billion (2.8% growth), will remain the world’s largest IT market.