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Global tech spending down

LAS VEGAS, Jan 5:

The outlook for global technology spending is uncertain after nearly flat growth in the past year, with turbulent economic conditions making a forecast difficult, an industry gathering was told yesterday.

At the media preview for the massive International Consumer Electronics Show in Las Vegas, data presented showed just one percent growth in 2014 to bring spending on technology to US$1.024 trillion (RM3.6 trillion).

But analyst Steve Koenig of the Consumer Electronics Association, which organises the event, said economic conditions around the world forced the group to defer its forecast for 2015.

“We have a very mixed spending picture,” Koenig said.

The market is being driven by strong demand for new products like tablets and smartphones in emerging economies in Asia, and by modest economic growth in North America.

The picture is clouded by economic stagnation in the eurozone and Japan and “weak expectations” in big emerging economies such as Brazil, Koenig explained.

Russia, another large emerging economy, is being hit by economic sanctions that could dent tech spending.

The association predicted a drop in tech spending of 5% in Europe and Latin America, and it remains unclear whether the rest of the world will pick up the slack.

Koenig said smartphone and tablet sales are growing at a healthy pace in China and other developing economies, and demand for new televisions is being driven by a “robust upgrade cycle” to the “ultra” high-definition displays.

At the same time, spending is being capped by the decreasing price for new mobile devices.

“A flood of low-cost devices is coming into the marketplace,” he said, noting the prominence of phonemakers in China such as Xiaomi, which has pushed into the top ranks of manufacturers.

CEA forecast smartphone unit sales growing 19% this year to 1.5 billion units, but revenue is expected to grow just nine percent to US$406.7 billion as prices fall.

The research report that the research company Forrester Research of the market delivers newly claims, through a difficult year of 2009 later, the global technological trade expenses will reach 1,600 billion dollars in 2010, will increase by 8.1% compared with 2009. Software and computer hardware high-ranking military officer are held in the mouth and increased. The global technological trade expenses drop by 8.9% in 2009.

Though calculate the growth of Europe will be the most powerful, according to U.S. dollar, the information tech spending of U.S.A. will be one of the bright spots of the global tech spending.

Weigh according to U.S. dollar, U.S.A. will be that the tech spending increase the most powerful area, after the tech spending of 2009 drops by 8.2%, the tech spending of U.S.A. will reach 568 billion dollars in 2010, increase by 6.6%.

This research company thinks, calculate according to U.S. dollar, the European tech spending will increase by 11.2%. Because of the decline of the the exchange rate for U.S. dollar against European dollar, getting of the incomes of western Europe and Central European country is promoted.

Forrester Research claims, the expenses of global software of 2010 will increase by 9.7%, the expenses of computer hardware will increase by 8.2%, the expenses of communication apparatus will increase by about 7.6%.

Forrester Research analyst Andrew Bartels says, the decline of the tech spending has not been over formally yet in 2008 and 2009. All conditions are suitable for the rebounding of the tech spending of 2010. He says, the recovery of the technological trade of U.S.A. will be much more powerful than the recovery of the whole economy in 2010, the growth rate of the tech spending is one time the size of GDP growth rate.