Software Spending to Maintain Double-Digit Growth in 2022
By : Basel Khaled
Worldwide government IT spending is forecast to total $557.3 billion in 2022, an increase of 6.5% from 2021, according to the latest forecast by Gartner, Inc.
“Governments will continue to accelerate investments in digital technologies to respond and recover from the continuing evolution of public health uncertainties due to the COVID-19 pandemic,” said Irma Fabular, research vice president at Gartner.
“The disruptions caused by the pandemic have also reinforced a key digital government tenet, which is public policy and technology are inseparable.”
In 2022, increased investments in digital technologies will see governments spend 64% of total IT spending on IT services and software to improve responsiveness and resilience of public services (see Table 1).
These include investments in enhancing customer and employee experience, strengthening analytical capabilities and scaling operational agility.
Table 1. Government IT Spending Forecast by Segment, 2021-2022, Worldwide (Millions of U.S. Dollars)
|
Segment
|
2021 Spending |
2021 Growth (%) |
2022 Spending |
2022 Growth (%) |
|
IT Services |
188,069 |
10.9 |
203,922 |
8.4 |
|
Software |
135,630 |
14.9 |
151,885 |
12.0 |
|
Telecom Services |
61,482 |
1.4 |
60,996 |
-0.8 |
|
Internal Services |
64,245 |
0.3 |
65,971 |
2.7 |
|
Devices |
41,049 |
17.6 |
40,390 |
-1.6 |
|
Data Center |
32,735 |
6.5 |
34,154 |
4.3 |
|
Total |
523,212 |
9.5 |
557,318 |
6.5 |
Source: Gartner (August 2021)
IT infrastructure and applications modernization as well as digital government transformation will remain high government priorities in 2022. In addition, COVID-19 economic assistance funding packages, such as the American Rescue Plan Act in March 2021 and NextGenEU, will drive further funding on digital enablement, including support for sustainable growth, social programs, education, cybersecurity, and digital inclusion.
Increased Adoption of Cloud Strategies and Citizen Digital Identity
The pandemic has amplified the need for governments to rapidly scale IT infrastructure and application systems and respond to unprecedented public demands.
Gartner estimates that by 2025, over 50% of government agencies will have modernized critical core legacy applications to improve resilience and agility. “Governments are rethinking their public cloud strategies to accelerate IT modernization, improve efficiencies and increase data security,” said Fabular.
The COVID-19 crisis has further intensified the need for adopting citizen digital identity as a critical element to digital government transformation. “Digital identity is moving beyond authenticating citizens online and signing remote transactions,” said Fabular. “To raise the chances for greater adoption of digital identity, governments must treat privacy, security and user convenience as critical success factors.”
Gartner clients can get more information in “Forecast: Enterprise IT Spending for the Government and Education Markets, Worldwide, 2019-2025, 2Q21 Update.”
Additional analysis on how government CIOs will reinvent programs and service delivery will be presented during Gartner IT Symposium/Xpo 2021, the world's most important conferences for CIOs and other IT executives. IT executives rely on these conferences to gain insight into how their organizations can use IT to overcome business challenges and improve operational efficiency. Follow news and updates from the conferences on Twitter using #GartnerSYM.
Upcoming dates and locations for Gartner IT Symposium/Xpo include:
October 18-21| Americas| Virtual
November 8-11| EMEA| Virtual
November 16-18| Japan| Virtual
November 30-December 2| India| Virtual
