Worldwide spending on IT is expected to total $5.26 trillion in 2024 thanks to the race to implement generative artificial intelligence (AI), according to the latest forecast by a leading tech industry analyst. This is a slight decrease from the previous quarter’s forecast of 8% growth, but still represents an increase of the overall spend forecast of $5.06 trillion.
However, the forecast, published this week by Gartner, expressed concern that software developers in particular were being forced to spend on the technology in order to keep up while others reaped the financial rewards.
“Generative AI is being felt across all technology segments and subsegments, but not to everyone’s benefit,” said John-David Lovelock, distinguished VP analyst at Gartner.
“Some software spending increases are attributable to GenAI, but to a software company, GenAI most closely resembles a tax. Revenue gains from the sale of GenAI add-ons or tokens flow back to their AI model provider partner,” he said.
The news comes as concern grows about the cost of AI technology, including energy use and emissions. Last week investment bank Goldman Sachs warned that AI was a “bubble” that doesn’t “justify the costs”, while in recent months both Microsoft and Google parent company Alphabet have published reports noting increased emissions.
Garnter’s spending forecast also said it expected spending on data center systems to increase by 24% in 2024, up from the previous quarter’s forecast of 10% growth, primarily due to use of AI technology.
“The compute power needs of GenAI are being felt across the data center, and spending in that segment reflects this ravenous demand,” said Lovelock.
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