CFOtech New Zealand logo
Technology news for Kiwi CFOs and financial decision-makers
Story image

Govt IT spending on the rise, driven by XaaS - Gartner

By Catherine Knowles
Thu 16 Jun 2022

Worldwide government IT spending is forecast to total $565.7 billion in 2022, an increase of 5% from 2021, according to Gartner.

Notably, the analysts forecast XaaS will emerge as a new area of investments, as governments scale digital transformation initiatives.

Gartner director analyst Daniel Snyder says, “The last few years of enduring pandemic challenges have mobilised a wave of digital transformation activities in government organisations across the world.”

He adds, “Governments are executing innovative activities by harnessing technology to streamline digital services, advance automation processes and evolve citizen experiences.”

In 2022, government IT spending is forecast to increase across all segments except internal services and telecom services. Continuing the trend from 2021, software is forecast to record the strongest growth across all segments in 2022.

As legacy modernisation continues to be a priority in government organisations, growth in the data centre systems segment will continue to slow though the forecast period, Gartner states.

Governments continue to invest in critical application software that directly support end user interfaces driving strong growth in this segment. Spending on telecom services is set to decrease in 2022 as governments reduce spending on expensive legacy systems in favour of digital service delivery models.

Anything-as-a-Service (XaaS) is gaining popularity across government organisations as it provides better return on investment, normalising IT spend over time making budgeting for IT more predictable, while avoiding the accrual of technical debt. Gartner predicts that by 2026, most government agencies’ new IT investments will be made in XaaS solutions.

In addition, with the ongoing talent challenges facing organisations, XaaS makes it easier for government organisations to find the right talent via XaaS operating models, Gartner states.

XaaS delivery models require different internal IT skill sets and place less demand on the organisation to develop or acquire emerging IT skills, which are often hard to find and difficult for governments to afford.

On this trend Snyder adds, “The pandemic sped up public-sector adoption of cloud solutions and the XaaS model for accelerated legacy modernisation and new service implementations.

“54% of government CIOs responding to the 2022 Gartner CIO Survey indicated that they expect to allocate additional funding to cloud platforms in 2022, while 35% will decrease investments in legacy infrastructure and data centre technologies.”

Overall, in 2022, IT services are expected to account for the biggest spend accounting for $204.2 billion total, up 10.7% from 2021. This is followed by software at $162.2 billion, up 16.9% from the previous year.

Internal services and telecom services are expected to drop 2.1% and grow 1.1% respectively, hitting $68.1 billion, and $67.1 billion. Finally, devices are marked to grow a notable 13%, accounting for $37.8 billion of the total spend.

Gartner's findings also suggest that spending in 2023 will hit 606 billion, with software up another 12.8% and IT services 8.2%.

Related stories
Top stories
Story image
Commerce Commission
ComCom puts electronics sector on notice over resale price maintenance
The Commerce Commission has concluded an investigation into allegations that television manufacturers were engaging in illegal resale price maintenance.
Story image
Market growth
Salesforce unveils new offerings for consumer goods companies
Salesforce has announced new products for consumer goods companies to help brands navigate increasing market complexity more easily.
Story image
Government
Cyclone selected as NZ MOE software licensing partner
Following a recent Request for Proposal (RFP), Christchurch-based company Cyclone Computer Company Ltd (Cyclone) has been selected as The Ministry of Education’s software licensing partner.
Story image
Healthcare
Workday winning on culture and family focus
This family-first approach sees all employees receive access to family-wide private healthcare cover, as well as income protection and life insurance policies.
Story image
Employment
Majority of APAC CFOs concerned about rising wages
"In challenging times, CFOs look to determine how they can do things differently and as a result, new ideas about future growth emerge."
Story image
Tech job moves
Tech job moves - Boomi, Limepay, Thales, VMware & Zoom
We round up all job appointments from June 6-16, 2022, in one place to keep you updated with the latest from across the tech industries.
Story image
Testing
Video: 10 Minute IT Jams - An update from Tricentis
Tricentis provides software testing automation, and software quality assurance products for enterprise software.
Story image
Training
Dell Technologies reveals growth of Student TechCrew in A/NZ
Dell Student TechCrew is an initiative designed to promote future career skills through Dell’s technical certification program and hands-on experience.
Story image
DNS
DigiCert acquires DNS Made Easy and affiliated brands
Greg Clark comments, says, "This combination enhances the security of certificate validation and enables the automation of future validations."
Story image
Orbital Insight
Orbital Insight solution set to drive better data-driven decisions
The company says the new Site Intelligence solution will provide granular visibility, behaviour analytics and deep insights about customers and competitors at any location. 
Story image
Artificial Intelligence
Salesforce harnesses automated solutions with new developments
Salesforce has launched Sales Cloud Unlimited, a new feature to help accelerate productivity with AI and automation.
Story image
Banking
Banks, PSPs prioritising payment modernisation to compete
A new report gives payment providers a forward-looking view of the evolution of payments and investment drivers for modernisation.
Story image
Electricity
Canstar finds Flick Electric NZ’s favourite provider
Canstar’s annual research to find New Zealand’s favourite electricity provider reveals Flick Electric has come out on top.
Story image
Robotic Process Automation / RPA
Study shows prioritising IA can deliver better operational outcomes
A new Everest Group Pinnacle Model study, supported by SS&C Blue Prism, has found that businesses that use and develop solid automated practices tend to see better operational outcomes.
Story image
Cloud
Cisco launches AppDynamics Cloud for greater performance
Cisco has launched AppDynamics Cloud, enabling the delivery of better digital experiences by correlating telemetry data from across any cloud environment at scale.
Story image
Innovation
Huawei unveils cutting-edge inventions at innovation event
Huawei has unveiled a range of new inventions as part of its biennial Top Ten Inventions Awards at the Broadening the Innovation Landscape 2022 forum.
Story image
N4L
N4L, Spark, Chorus partner for Hyperfibre school upgrade
Networks for Learning (N4L) has partnered with Spark and Chorus to upgrade Wellington College to Hyperfibre, fostering stronger outcomes for students and teachers.
Story image
Dark web
Cybercrime in Aotearoa: How does New Zealand law define it?
‘Cybercrime’ is a term we hear all the time, but what exactly is it, and how does New Zealand define it in legal terms?
Story image
Manhattan Associates
New late-stage order cancellation to improve customer service
Manhattan Associates launches new service allowing orders to be cancelled up to the point of manifested/loaded status, preventing unwanted shipments and costly returns.
Story image
Cloud
Automation a point of difference for APJ enterprises - report
There has been a massive shift in which departments are using automation tools and creating those automations, according to Workato.
Story image
Robotic Process Automation / RPA
rapidMATION helps Coates achieve success with landmark RPA solution
A strong Robotic Process Automation solution (RPA) can help solve many complex issues that businesses face daily. 
Story image
Open XR
Juniper Networks, Sumitomo Electric, Arrcus join Open XR forum
Building a robust multi-vendor ecosystem is essential to enable network operators to achieve increased network capabilities provided by XR optics technology.
The Access Group
Health and social care organisations are currently under significant financial pressure. Find out how financial transformation can help provide an effective route forward.
Link image
Story image
Entelar
How TruSens air purifiers can create healthier workspaces
The pandemic has heightened our awareness of our own and others’ health, and made us all much more conscious of the environments we work in.
Story image
Hybrid workforce
Why hybrid working is here to stay and how to ace it
Citrix's new report reveals hybrid workers are more productive and engaged at work than their office and completely remote counterparts.
Story image
Cloud
Cloudflare outage in 19 data centers worldwide due to own error
Cloudflare says its outage for 19 of its data centers yesterday was because of a change in a long-running project to increase resilience in its busiest locations.
Story image
Data
How a single mandate changed software development forever
There’s conjecture about exactly when it was issued and by whom, but a mandate made twenty years ago is continuing to shape the software development process today.
Story image
PagerDuty
Ready for anything with the PagerDuty Operations Cloud
In a world of digital everything, teams face increasing complexity. Ever-growing dependencies across systems and processes put customer and employee experience, not to mention revenue, at risk.
Story image
Cloud
Dynatrace named Leader in Gartner’s 2022 Magic Quadrant
Gartner has named Dynatrace a Leader in the 2022 Magic Quadrant for Application Performance Monitoring (APM) and Observability.
Story image
eInvoicing
Airwallex, Xero extend partnership with easier invoice payments
Airwallex has extended its long-term partnership with Xero by releasing a new payment link integration for Xero invoices that will make receiving them easier and faster for Australian businesses.
The Access Group
Increasing headcount isn't always the best way to grow. A good financial strategy can help solve many issues, and The Access Group shares the secret to success.
Link image
Story image
Citrix
The best ways to attract young talent during labour shortages
New research from Citrix reveals hybrid working and ventures into the metaverse are top of mind for Gen Z workers.
Story image
Appointments
Tech job moves - EOS, Rubrik, SAP, Talent, Verizon & Zoom
We round up all job appointments from June 2-8, 2022, in one place to keep you updated with the latest from across the tech industries.
Story image
Broadband
Most NZ broadband can deliver four HD Netflix streams at the same time
Measuring Broadband New Zealand's latest report shows 99% of Fibre 300, Fibre Max, and HFC Max plans can handle four simultaneous high-definition Netflix streams.
Story image
Collaboration
IT and security team collaboration crucial to data security
Many IT and security decision makers are not collaborating as effectively as possible to address growing cyber threats.
Story image
API
Industry-first comprehensive risk-based API security enhances protection
Application Programming Interfaces (APIs) have become a crucial part of operating web and mobile application businesses and are causing significant economic growth in the digital sector.
Story image
Contact Centre
Customer service agents don't want to return to contact centres
A new report has revealed that 85% of customer service agents want to work full-time at home and not return to contact centre offices.
Story image
Cybersecurity
Why is NZ lagging behind the world in cybersecurity?
A recent report by TUANZ has revealed that we are ranked 56th in the world when it comes to cybersecurity - a look into why we're so behind and what needs to be done.
Story image
Remote Working
Globalization Partners to improve global talent hire
Globalization Partners says the global availability of its services will make it fast and simple for companies to hire and pay anyone, anywhere in the world.
Story image
Cloud
TradeWindow using Nintex platform amid global expansion
TradeWindow is using Nintex Promapp to support its recent expansion and to prepare for ambitious international growth.
Story image
Cloud
Boomi surpasses 20,000 customers. Sets record for the iPaaS space
Boomi has announced it has surpassed the 20,000 customer mark, setting the record for the largest customer base among iPaaS vendors.
Story image
Microsoft
Volpara, Microsoft project to detect cardiovascular issues
Volpara Health Technologies is working with Microsoft on a research and development project to speed up creating a product that detects and quantifies breast arterial calcifications (BACs).
Story image
Digital Transformation
Govt IT spending on the rise, driven by XaaS - Gartner
Worldwide government IT spending is forecast to total $565.7 billion in 2022, an increase of 5% from 2021, according to Gartner.
The Access Group
Struggling to understand which transformative technologies will help your business? The Access Group provides a look into key opportunities and impacts for finance.
Link image