IT spending in Canada to grow 3.3 percent in 2015

By John Lovelock
Gartner, Inc.

IT spending in Canada is forecast to total $102.0 billion Canadian Dollars in 2015, a 3.3 percent increase from the 2014 projected spending of $98.8 billion, and much of this spending will be driven by the digital industrial economy.

Global IT is in a transition from the era of IT Industrialization – where efficiency and effectiveness were the hallmarks – to an era of digitalization and digital business. Digital business is about the creation of new business designs by blurring the physical and digital world. It is about the interaction and negotiations between people, business and things. It is when these things start to negotiate amongst themselves, as well as with people and business, that we will start to see how we are entering an entirely new and disruptive world.

As the business world transitions to digital business, technology products and services are going to have to take some very different paths and growth in IT spending will vary significantly from sector to sector.

Software spending is seeing the highest growth rates, 9% in 2015, as we progress into the digital age. Digital business is led by the business and one of the first consequences we are seeing is the decentralization of spending outside of the IT budget or within shared new budgets being created specifically for digital business initiatives. Software investments will be valued differently by these new buyers and/or decision-makers.

We will continue to see spending focus on software to modernize and enable external facing or Web deployments, geared towards the customer experience. We are also likely to see spending flowing to startups, disruptors and specialized Canadian software and service providers as companies look for cheaper, faster, easier web application development, for competitive differentiation and advantage.

The IT services forecast has a solid 5.3 percent growth rate in 2015, however, a few sub-segments of IT services are responsible for much of the growth. Business consulting service providers in particular, will be market makers in delivering digital business transformation services as consulting services almost always preclude services in the adoption of new technologies and in any new business era. Those with verticalized industry, discipline or issue skills will have an added advantage but they must change the nature of how business is performed and focus on delivering business outcomes.

Digital business is enabled by the integration of people, business and things. Without communications services, we would not have digital businesses. The Internet of things & Machine to Machine (M2M) connectivity will require some new mobile data services, most of the M2M communication will be based on existing enterprise networks and thereby bypass the service providers. The explosion of mobile data spent, 23.6 perent in 2015, is not explained by M2M nor by digital business. The primary effects at work are; the limited competition among telecommunications service providers in the Canadian market coupled with the raise in number and type of devices accessing mobile data. In the digital age users increasingly want experience not hardware, therefore devices are equipped with hardware features and embedded technologies which allow easy, unobtrusive collection and transfer of data. As we move to wearable interfaces like Google Glass and beyond that with emotion detection technology, the amount of different types of data collected only increases.

Consumers will increasingly take control of the information they provide, seeking to monetize it by entering “data bartering” agreements to attain services and promotions in return for their data. As a result, business to consumer companies will increasingly invest in and leverage analytics and self- learning software to target the right consumers. Information in the digital world will become a much tradable commodity as we move through the cognizant computing stages


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Jim Love, Chief Content Officer, IT World Canada
Gartner, Inc. (NYSE: IT) delivers actionable, objective insight to executives and their teams. Our expert guidance and tools enable faster, smarter decisions and stronger performance on an organization’s mission critical priorities. To learn more, visit

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