Does the world spend 6% of GDP on IT?
I noted a story that Gartner Group reported that worldwide IT spending is on a pace to reach $3.1 trillion in 2007, with a forecast of $3.3 trillion next year. Even more interesting is that IT spend in developing countries is rapidly rising, with one-third of all IT spending (i.e., $1 trillion) being done by nations other than North America, Western Europe, and Japan.
Wow! That sounds impressive, eh? But then I got to thinking about it. We live in an IT-centric world, no doubt. The benefits of IT are spreading everywhere, without question. But $3 trillion? That's a lot of dollars -- or yuan, pesos, reals, etc.
In fact, the more I thought about it, the more the numbers seemed a bit ... high. So I decided to do some poking around. The World Bank reports total global GDP for 2006 as $48 trillion, with individual countries ranging from the US at $13.2 trillion all the way down to Kiribati at $50 million (I'm ashamed to say that I had never heard of Kiribati before, although I had heard of by the name its pre-independence name, the Gilbert Islands).
If you round Gartner's number to $3 trillion, it represents 6.25% of total global GDP. If you look at the US numbers, you can just about see 6.25% of GDP being devoted to IT spend of all types -- software, hardware, services, and internal IT spend; in fact, it might be a little higher than 6.25% all in. The US, after all, is by far the most IT-intensive economy in the world.
But I have a hard time seeing the rest of the world at 6.25%. And, if you look at the bottom of the World Bank numbers, you can see its summaries of GDP. The Low and Middle Income countries of the world have, in total, around $11.6 trillion GDP. For them to spend $1 trillion, they would have to devote 8.6% of GDP to IT. I know that these economies are rapidly developing, and many of them are focusing on IT (particularly the BRIC countries), but ... 8.6%? That would be 1 out of 12 dollars out of their entire economies devoted to IT. I think the 8.6% is particularly implausible given the rampant software piracy and use of open source characteristic of these nations.
I'm not saying Gartner Group is wrong, but I'd sure like to see their calculations to understand how they concluded the world is spending $3 trillion on IT, because that seems way high to me.
Previous Post: Sun's interesting virtualization initiativeNext Post: BEA: Icahn, not Ellison is key player in this drama
Most Discussed Posts
Cloud computing has emerged as one of the most significant game changers to hit the technology landscape in the past 20 years. With this massive expansion of the cloud, the perception of the IT organization is shifting from a utility player to a change agent. This eBook breaks down five ways progressive organizations are using cloud-based IT Management solutions to help drive innovation and become more strategic, including: adding visibility and analytics, speeding up time-to-value, lowering costs, improving prioritization, and providing a blueprint for future cloud deployments.
Read the white paper to see how IBM helped Citigroup deliver new services and enhancements to their 200 million customers faster.
There are 3 ways to modernize legacy applications: rewrite completely, acquire packaged solutions or migrate existing code. This paper explains why it's best to migrate and how IBM® Rational® software can help.
Accommodating specific lines of business can result in a hybrid ecosystem of applications and servers. The resulting complexity of this architecture makes for an environment that is costly to maintain and difficult to change when addressing new challenges.
This whitepaper will help you to define a mobile device passcode policy. Security managers must attempt to reconcile two opposing goals. They must: 1) create a passcode policy that is strong enough to protect the device if it is lost or stolen, while: 2) not annoying users with needless length or complexity.
This whitepaper, authored by The Radicati Group, looks at the key reasons organizations should consider moving to a cloud-based archiving solution. Email archiving solutions enable organizations to store, monitor, and collect electronic data exchanged by their users to comply with internal policies and regulations.
ATERNITY will showcase a 30-minute demo on how Fortune 500 companies are leveraging its award-winning FPI Platform to deliver a user-centric approach to Proactive IT Management.
For businesses to move forward and tap into the ever-expanding universe of Internet users and network-enabled devices, it's critical to learn how to make the transition to IPv6. Learn the critical steps your organization must take to make a seamless transition-and keep your business world connected.
Learn how IT teams can protect against spear phishing tactics. Harry Sverdlove, chief technology officer of Bit9 offers a frank discussion about spear phishing - the most common technique used in today's advanced attacks.
Learn how to build a solid business case for your migration to Red Hat Enterprise Linux so you can run leaner, innovate faster, be more flexible and own the New Now.
Social media isn't about you; it's about everything around you. As you consider how your customers want to communicate with you, social media is something that can't be ignored. But what should your strategy be? Is social media "just another channel?" What kind of a plan makes sense for your contact center and for your customers? Join our experts as they share their insight and research results.
Hardware tokens were a popular method of strong authentication in past years but the cumbersome provisioning and distribution tasks, high support requirements and replacement costs have limited their growth. The additional log-in steps that hardware tokens require and the resulting user frustrations have limited adoption and make them impractical for larger scale partner and customer applications.
Sponsored Links
