PC market on a roller-coaster
On the heels of strong growth during the third quarter of 2019 (3Q19) and changing dynamics in the market for personal computing devices (PCDs), IDC (International Data Corporation) has raised its outlook for the remainder of 2019.
According to the new Worldwide Quarterly Personal Computing Device Tracker, overall PCD shipments will reach 407.7 million by the end of 2019, up 0.5% from 2018. However, despite this recent growth, long-term forecasts remain negative as the market will dip to 366.7 million units in 2023 with a compound annual growth rate (CAGR) of -2.6% from 2019–2023.
While the upcoming end of support for Windows 7 has been a boon for the industry as commercial organisations pursued hardware upgrades, 2020 will be more of a challenge as upcoming tariffs and expected chip shortages bite. This will lead to an expected 7% decline in new shipments.”
However, IDC does anticipate growth in modern form factors such as 2-in-1s and thin and light notebooks and higher average selling prices (ASPs) here will help offset declines elsewhere
Though other form factors such as traditional desktops and notebooks will continue to decline, IDC anticipates a growing share of those form factors will cater to emerging demand for creator PCs as well as sustained demand for gaming PCs. Meanwhile, slate tablets will continue their downward trajectory as their lifecycles extend and incumbents such as Apple, Samsung, and Huawei slowly shift their product portfolio toward detachable tablets.
Finally, a growing supply of cellular-enabled PCs will also provide an uplift for notebooks and detachable tablets as telcos around the world work closely with the likes of Intel, MediaTek, and Qualcomm to bring 4G-enabled devices in the short term, and 5G-enabled devices in the long term into the hands of consumers and businesses alike.
• All figures represent forecast data.
• Traditional PCs include Desktop, Notebook, and Workstation.
• 2-in-1 devices are a category including convertible PCs and detachable tablets. Convertible PCs are notebook computers equipped with an integrated keyboard and display that can be used in either a traditional notebook configuration or a slate configuration. A detachable tablet meets all the criteria of a slate tablet but is designed to operate with a first-party keyboard designed specifically for the device.
Public cloud revenue to grow 17% in 2020
IaaS will be the highest growth area in 2020 due to data centre consolidation
The worldwide public cloud services market is forecast to grow 17% in 2020 to total $266.4 billion, up from $227.8 billion in 2019, according to Gartner.
“At this point, cloud adoption is mainstream,” said Sid Nag, research vice president at Gartner. “The expectations of the outcomes associated with cloud investments, therefore, are also higher. Adoption of next-generation solutions are almost always ‘cloud-enhanced’ solutions, meaning they build on the strengths of a cloud platform to deliver digital business capabilities.”
Software as a service (SaaS) will remain the largest market segment, which is forecast to grow to $116 billion next year due to the scalability of subscription-based software (see Table 1). The second-largest market segment is cloud system infrastructure services, or infrastructure as a service (IaaS), which will reach $50 billion in 2020. IaaS is forecast to grow 24% year over year, which is the highest growth rate across all market segments. This growth is attributed to the demands of modern applications and workloads, which require infrastructure that traditional data centres cannot meet.
Table 1. Worldwide Public Cloud Service Revenue Forecast (Billions of U.S. Dollars)
and businesses alike.
BPaaS = business process as a service; IaaS = infrastructure as a service; PaaS = platform as a service; SaaS = software as a service
Note: Totals may not add up due to rounding.
Source: Gartner (November 2019)
Various forms of cloud computing are among the top three areas where most global CIOs will increase their investment next year, according to Gartner. As organizations increase their reliance on cloud technologies, IT teams are rushing to embrace cloud-built applications and relocate existing digital assets. “Building, implementing and maturing cloud strategies will continue to be a top priority for years to come,” said Mr Nag.
“The cloud managed service landscape is becoming increasingly sophisticated and competitive. In fact, by 2022, up to 60% of organisations will use an external service provider’s cloud managed service offering, which is double the percentage of organizations from 2018,” said Mr Nag. “Cloud-native capabilities, application services, multi-cloud and hybrid cloud comprise a diverse cloud ecosystem that will be important differentiators for technology product managers. Demand for strategic cloud service outcomes signals an organizational shift toward digital business outcomes.”
Managed services continue on an upward curve
A study by Grand View Research estimates the global managed services market will continue to grow at a compound annual growth rate (CAGR) of 11.7% over the next six years to reach an overall size of $376.13 billion by 2025.
This rapid growth, several times the rate of growth for the overall market, is being driven by the increasing reliance by businesses on the use of IT to improve business productivity, coupled with a continuing rise in demand for cloud-based managed services.
SYNAXON is already fuelling the debate with its own SynMSP community and now, IT Europa and Angel Business Communications have announced that they will jointly be staging the fourth annual European Managed Services & Hosting Summit on 28 May 2020. This event will feature leading hardware and software vendors, hosting providers, telecommunications companies, mobile operators and web services providers involved in managed services and hosting together with MSPs and resellers, integrators and service providers.
VR and AR set for huge growth
Worldwide spending on augmented reality and virtual reality (AR/VR) is forecast to be $18.8 billion in 2020, an increase of 78.5% over the $10.5 billion that IDC (International Data Corporation) expects will be spent in 2019.
The latest update to the firm’s Worldwide Augmented and Virtual Reality Spending Guide also shows that worldwide spending on AR/VR products and services will continue this strong growth throughout the 2019-2023 forecast period, achieving a five-year compound annual growth rate (CAGR) of 77.0%.
Worldwide spending on AR/VR solutions will be led by the commercial sectors, which will see its combined share of overall spending grow from less than 50% in 2020 to 68.8% in 2023.
The commercial sectors expected to spend the most on AR/VR in 2020 are retail ($1.5 billion) and discrete manufacturing ($1.4 billion). Fifteen industries are forecast to deliver CAGRs of more than 100% over the five-year forecast period, led by securities and investment services (181.4% CAGR) and banking (151.9% CAGR).
Consumer spending on AR/VR will be greater than any single enterprise industry ($7.0 billion in 2020) but will grow at a much slower pace (39.5% CAGR). Public sector spending will maintain a fairly steady share of overall spending throughout the forecast.
Commercial use cases will account for nearly half of all AR/VR spending in 2020, led by training ($2.6 billion) and industrial maintenance ($914 million) use cases. Consumer spending will be led by two large use cases: VR games ($3.3 billion) and VR feature viewing ($1.4 billion).
However, consumer spending will only account for a little over one-third of all AR/VR spending in 2020, with public sector use cases making up the balance. The AR/VR use cases that are forecast to see the fastest growth in spending over the 2019-2023 forecast period are lab and field (post secondary) (190.1% CAGR), lab and field (K-12) (168.7% CAGR), and onsite assembly and safety (129.5% CAGR). Seven other use cases will also have five-year CAGRs greater the 100%. Training, with a 61.8% CAGR, is forecast to become the largest use case in terms of spending in 2023.
Hardware will account for nearly two-thirds of all AR/VR spending throughout the forecast, followed by software and services. Services spending will see strong CAGRs for systems integration (113.4%), consulting services (99.9%), and custom application development (96.1%) while software spending will have a 78.2% CAGR.