IT spending is set to rise by 5% from European businesses during 2025, due to cybersecurity and artificial intelligence (AI), according to market analysis from Forrester.
Total IT spending is projected to reach $4.9 trillion in 2025, Forrester’s Global tech forecast 2024-2029 predicts, with generative AI (GenAI), cybersecurity and Cloud services to drive growth by 5.6% compared to just 4.6% in 2024.
Forrester's research predicts IT services and software will account for two-thirds of global technology spending this year, driven by increased investment in cybersecurity and the modernisation of legacy systems to better safeguard against an evolving cyber threat landscape.
Analysts from the company believe concentrating investment on cybersecurity and AI will provide businesses with a competitive edge and support sustainable growth.
"It’s encouraging to see businesses investing more in cybersecurity, as strong defences are essential in today’s evolving threat landscape," said Andy Ward, SVP, Absolute Security. "However, to truly protect against risks, organisations must go beyond just new tools—they need a to put a robust cyber resilience strategy in place. This means investing in prevention and recovery solutions, having clear incident response plans, and ensuring IT teams have real-time visibility across all devices to detect and stop threats early."
Software is due to grow at a rate of 10.5%, expected to make up 60% of global technology spending in 2029.
IT consulting and system integration services, meanwhile, will account for one-fifth (19%) of global spending and are predicted to be among high-growth areas of tech.
"Over the next five years, technology investments will reshape industries at an unprecedented pace," said Michael O'Grady, Principal Forecast Analyst, Forrester. “Legacy systems still capture two-thirds of global tech spending. With the half-life of tech skills at less than five years, skills renewal of the tech workforce is vital.”
