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ICT spending in Germany, Austria and Switzerland will reach $275 billion

According to International Data Corporation’s (IDC) Worldwide ICT Spending Guide: Enterprise and SMB by Industry, ICT spending in the DACH region (Germany, Austria and Switzerland) will reach $275 billion in 2023 and will surpass $330 billion by 2026. With a 6.4% compound annual growth rate (CAGR) for 2021–2026, growth in ICT spending in the region will exceed the European average (5.4%).

Investments in technologies will continue despite unprecedented market disruptions caused by the Russia-Ukraine War. A strong reliance on Russian gas is increasing economic vulnerability in Austria, Germany, and Switzerland, and higher costs of living will impact consumer purchasing power. Organizations in the DACH region will need to cope with increasing prices for technologies, as well as serious labor shortages and a lack of IT skills.

“As we’re slowly recovering from a year of struggling with unprecedented market disruption, our expectations for the future are becoming brighter,” said Zsolt Simon, senior research analyst, IDC. “However, the positive predictions and the better-than-expected economic performance may create a false sense of stability. Labor shortage will rage on and energy prices will remain elevated, so businesses need to stay alert and rely on data to continuously evaluate the risks and opportunities.”

To tackle the disruption, investments will be shifted to technologies that can sustain growth by reducing costs, improving performance, optimizing processes, and enhancing customer experience, even in uncertain times. Artificial intelligence, which can significantly improve customer and employee experience and mitigate skills shortages, will be one of the fastest-growing investment areas. Spending on AI platforms, such as AI software services and AI life-cycle software, will grow 46.6% in the DACH region between 2021 and 2026. Discrete manufacturing, professional services, and the banking industry will spend the most on AI platforms this year, while investments by the healthcare, insurance, and telecommunications industries will increase at the fastest rate into 2026.

Spending on security will be a key priority for organizations in the DACH region. With 14.8% CAGR between 2021 and 2026, the insurance industry will increase security software investments the most rapidly. Cloud and IoT will also see steady growth toward 2026, with 23.2% and 11.1% CAGR respectively.

CT Bureau

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