Rising IT spending lifts tech giants

Nancy Marshall-Genzer Jul 27, 2021
Heard on:
HTML EMBED:
COPY
Big tech companies will be releasing their earnings this week and are likely to see a boost from increased IT spending. Sean Gallup via Getty Images

Rising IT spending lifts tech giants

Nancy Marshall-Genzer Jul 27, 2021
Heard on:
Big tech companies will be releasing their earnings this week and are likely to see a boost from increased IT spending. Sean Gallup via Getty Images
HTML EMBED:
COPY

It’s a big week for tech company earnings, with Microsoft, Google parent Alphabet and Apple all reporting Tuesday, and Amazon on Thursday.

The tech research firm Gartner is predicting that worldwide IT spending will shoot up more than 8% this year. Companies are investing in technology like mobile desktops, said Gartner’s chief forecaster, John Lovelock.

“You can use any device that you like to connect to your desktop that’s in the cloud. So whether I’m at work, whether I’m at home, whether I’m at a coffee shop or whether I’m traveling, I can always get to my work,” he said.

Health care providers are investing in IT for telehealth and schools are continuing to pour money into virtual learning technology, per Lovelock. And everybody’s using the cloud more, padding the bottom lines of the tech titans. Even smaller companies are jumping in.

“I can’t say it enough: Cloud, cloud, cloud, cloud, cloud,” said Lance Ellisor, chief operating officer of Journyx, which sells software to help companies track their workers’ time.

Ellisor figures Jornyx will increase IT spending this year by 15-25%. They’re getting rid of their servers and storing company data in the cloud, instead. That’s partly to prevent outages if there are unexpected events, like a flood.

“You know that your systems are still going to be up and running. It’s about knowing that they are secure and compliant,” Ellisor said.

Ellisor says they use Amazon for cloud services. They rely heavily on Microsoft teams to connect their roughly 35 remote workers.

Remote work will continue to be the norm for many employers, said independent cybersecurity researcher Tiffany Strauchs Rad. She said companies are spending more on cloud services so remote workers can connect securely and so they can back up their data, in case of a cyberattack.

“It’s a lot cheaper right now to prepare for, should this happen to your company instead of, ‘Well, it’s not going to happen to us, we’re a small company,'” she said.

Some firms are encrypting their data, Strauchs Rad said, while others are investing in the cybersecurity training sessions that many of us hate but can help keep hackers out.

We’re here to help you navigate this changed world and economy.

Our mission at Marketplace is to raise the economic intelligence of the country. It’s a tough task, but it’s never been more important.

In the past year, we’ve seen record unemployment, stimulus bills, and reddit users influencing the stock market. Marketplace helps you understand it all, will fact-based, approachable, and unbiased reporting.

Generous support from listeners and readers is what powers our nonprofit news—and your donation today will help provide this essential service. For just $5/month, you can sustain independent journalism that keeps you and thousands of others informed.