Channel Beat: Why The IT Spending Forecast is Negative

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Bad news for the channel: According to research firm Gartner,IT spending worldwide will fall 5.5 percent in 2015.

In April,Gartner predicted a more modest drop of 1.3 percent, but said many segments are being affected by the U.S. dollar. Some vendors have been forced to raise prices to protect costs and margins, which can change consumers’ spending habits.

Gartner forecasts the devices market to see the hardest hit, with a decrease of 5.7 percent in global spending. Spending in data center systems will likely fall 3.8 percent, and it services spending is predicted to drop by 4.3 percent.

Microsoft made headlines this week, saying it willcut 7,800 employeesin its shift to focus on its software business.

Most of the cut employees will come from the company’s phone business, andpartners applauded the move. It’s no secret that Microsoft’s hardware business has struggled -- and now the company will pursue a mobile-first, cloud-first strategy. One year ago, Microsoft said it would lay off 18,000 employees.

EMC will sell its file-sync-and-sharing business Syncplicityto Skyview Capital this month. The company announced the deal this week, and the sale is expected to close by the end of the month.

EMC isunder pressure from Elliott Managementto break up and consolidate its company, including subsidiary VMware. To date, EMC has resisted that option. Syncplicity will operate as a subsidiary of NewNet, a Skyview portfolio company.

PUBLISHED JUNE 10, 2015