The IT industry, which is experiencing weak demand as a result of macroeconomic issues, would benefit greatly from the predicted increase in digital expenditure.
Information technology (IT) organizations could anticipate a 13% growth in digital investment to exceed $26 billion in 2024 as a result of customers placing a higher priority on initiatives related to organizational efficiency and optimization.
According to information obtained by Moneycontrol from TeamLease Digital, this is a significant increase over the growth of just around 5% to $22.9 billion in the prior year.
Information technology (IT) firms would benefit greatly from the expected increase in digital expenditure, since the industry has seen slow demand as a result of macroeconomic issues.
According to Krishna Vij, business head of IT staffing at TeamLease Digital, "IT has been the overwhelming favorite when it comes to adapting AI (Artificial Intelligence), as well as AI is one of the enablers when it regards to digitisation, so it's a hand in glove situation."
Clients' digital expenditure often translates into income from modern companies using these technologies, such as cloud, goods, and platform services. But every organization has a different meaning of this.
To increase operational efficiency and streamline their procedures, businesses in a variety of industries, including travel, retail, e-commerce, and tourism, are investing more and more in digital technology, especially artificial intelligence (AI) and cloud-based solutions. "On the one hand, we are increasing employment possibilities and eliminating jobs from the labor market. The second is that by introducing more technological involvement, you're automating several processes," Vij said.
According to the report, total IT expenditure is expected to rise to $138.9 billion, an increase of more than 13 percent. The largest increase in absolute terms will be seen in IT expenditure on devices, which is expected to increase by 17% to $55.8 billion.
IT company CEOs have been pointing out more and more that AI, especially Generative AI, has been gaining traction in the last several years.
In its third-quarter earnings release, Accenture said last week that it has booked over $900 million in Gen AI. This brings the world's biggest IT company's total Gen AI bookings for the fiscal year to far to $2 billion.
Julie Sweet, the CEO of the Dublin-based company, said investors on June 21 that "most clients are coming to the realisation of the money invested needed to truly implement AI across the enterprise, which includes developing a strong digital core."
In addition to embracing new technology, the move toward AI and cloud computing aims to close the skills gap in the labor market. Vij emphasized that the market needs around 6 lakh specialists, compared to the present 4 lakh, meaning there is a 51 percent imbalance in supply and demand for AI workers.
She went on to say that in order to close this talent gap and guarantee that they have the skills needed to properly use these technologies, IT organizations are investing in upskilling and training programs in addition to technology.
There are now over 750 million internet users in India, and that number is rising. A vast market for various digital services, platforms, applications, and solutions will become available as a result.
Increasing output
It is anticipated that this increase in digital expenditure would have a cascading effect, boosting productivity in a number of different businesses.
Businesses are making significant investments in AI-related technologies due to the high overall return on investment. Additionally, they are allocating discretionary funds for these technologies," said Vij. This pattern demonstrates the significance of AI in affecting various sectors in addition to the IT industry.
The need to improve industry-academia relationships and restructure the educational system has come up in response to the growing need for AI specialists. "Our education system needs to be revamped, and there is an important need for industry-academia partnerships to develop a workforce that is ready for the future," Vij said.
As businesses continue to work through the challenges of digital transformation, artificial intelligence (AI) and cloud computing are expected to play a major role in their strategic goals. Positive market forecasts for AI indicate a steady stream of funding for these innovations.
According to Vij, "the market projection across AI is very heavy, and this will continue to be there," suggesting that there is a strong market for digital expenditure powered by AI.
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