IT Spending in 2024: Three Key Trends
How companies can streamline their operations and unlock new pathways for growth in 2024.
Christoph Nagy, CEO of SecurityBridge, explores in detail what to expect in the evolving landscape of 2024. He dives into the future of infrastructure, AI-driven software, and cybersecurity for a sustainable digital era.
It has become increasingly important to consider the potential developments within IT. Some of these developments are certain domains poised to draw significant investment from IT budget custodians in 2024.
I see three principal categories: Infrastructure, Software & Applications, and Cybersecurity. Given the rapid evolution of technology, numerous trends could emerge within each sector, and it’s challenging to cover them exhaustively.
1. Cybersecurity
This crucial category is focused on protecting IT assets and encompasses the practices, tools, and policies designed to defend against cyber threats. It includes network, application, and operational security and measures to ensure data privacy and integrity. All businesses, regardless of size, face persistent cyber threats.
However, more giant corporations are adopting proactive security measures, a trend driven by the growing number of regulations worldwide and the escalating sophistication of these risks.
In 2024, IT departments are likely to concentrate their cybersecurity budgets on the following three predominant areas:
- Advanced Threat Detection and Response: Investments will likely focus on automated and intelligent systems that can predict, detect, and respond to cyber threats in real-time, utilizing AI and machine learning technologies.
- Cloud Security: As organizations migrate to cloud services, significant resources will be allocated to secure cloud infrastructures. These resources include tools for encryption, identity and access management, and monitoring to safeguard against breaches and comply with compliance regulations.
- Employee Security Awareness and Training: Recognizing that human error is a significant vulnerability, IT departments will prioritize funding for comprehensive training programs to educate employees on recognizing and preventing cyber threats like phishing and social engineering attacks. Furthermore, bridging the knowledge gap is becoming critical for organizations, especially with IT security experts in short supply.
2. Software & Applications
Software and applications encompass all types of software, from operating systems to critical enterprise application software. In addition, this category also concerns the programs and operating environments that run on IT hardware or hyper-scale cloud. It’s everything from basic system software to specialized applications, databases, and Enterprise Resource Planning (ERP) systems.
Office and ERP application software will be pushed to use significant language model-based AI copilots. For example, SAP has announced the SAP Joule AI Co-Pilot for early 2024. Microsoft has already released a companion function for multiple office applications within the Office365 offering.
In the software and applications area for 2024, the most significant spending by IT departments will be directed toward:
- ERP Systems: Organizations must invest heavily in ERP systems to integrate and manage finance, supply chain, operations, reporting, manufacturing, and human resource activities. However, their spending will focus on ERP implementation projects and upgrades or migration initiatives, i.e., SAP S/4HANA. Further, we expect the first investments to be on AI Co-Pilot functions provided by the ERP vendors.
- Cybersecurity Software: With the threat landscape intensifying, substantial investments are anticipated in security software solutions, including advanced endpoint protection, identity management, and threat intelligence platforms. For 2024, we foresee a significant uptrend in comprehensive cybersecurity platform solutions and a decline in discrete spot solutions. This projection is based on the need for more labor and expertise in the cybersecurity field. Maintaining numerous individual solutions is increasingly viewed as a burden; thus, decision-makers are expected to favor broad-spectrum security platforms over narrowly focused solutions.
- Collaboration and Remote Work Tools: As remote work continues to be prevalent, spending on software that enables collaboration, communication, and productivity among dispersed teams will remain a priority. Collaboration and remote work tools include video conferencing, instant messaging, project management, and shared workspaces.
See more: Defying Economics: IT Budgets Expected To Rise in 2024 Amid Recession Preparations
3. Infrastructure
Infrastructure includes all the physical aspects of IT systems, such as servers, storage, network devices, and data centers. It also consists of the necessary hardware to support cloud-computing infrastructure and communications.
As this hardware is pushed closer to the data source (IoT, mobile devices), we should anticipate more edge computing–especially in areas where high-speed internet is not widely available. For these reasons, edge computing will enable multiple new business models for enterprises, i.e., in gaming or virtual reality.
For the infrastructure and hardware sector in 2024, IT departments will prioritize their spending in the following three areas:
- Cloud Infrastructure: As businesses continue to embrace digital transformation, spending on cloud infrastructure services, such as storage, computing, and networking capabilities offered by providers like AWS, Microsoft Azure, and Google Cloud is expected to rise.
- Network Security Hardware: There will be significant investment in advanced network security appliances to protect against increasing cyber threats. These applications include next-generation firewalls, intrusion detection/prevention systems, and unified threat management solutions.
- Sustainable and Energy-Efficient Hardware: With growing awareness of environmental impacts, IT departments will focus on procuring hardware that is not only high-performance but also energy-efficient and designed with sustainable practices in mind. These energy-efficient measures could also include updates to data centers to make them more energy-efficient.
Conclusion: Embracing Connectivity and Intelligence
As we move into 2024, the evolution of IT spending is distinctly marked by the deep integration of Artificial Intelligence (AI) and large language models throughout all facets of technology. This trend signifies a shift towards more interconnected and intelligent IT ecosystems, where AI is supportive and a driving force for innovation and operational excellence.
Specifically, the continuing adoption and evolution of cloud computing is expected to receive a significant share of IT budgets as organizations seek to leverage cloud environments’ scalability, flexibility, and efficiency.
Coupled with AI’s analytical and predictive power, cloud computing is set to become even more robust, fueling advancements in cybersecurity, software applications, and infrastructure. Businesses investing in these integrated, AI-enhanced cloud platforms will be well-positioned to enhance their digital resilience and agility.
By embracing these key trends—unified cybersecurity frameworks, AI co-pilots for enterprise applications such as ERP systems, and sustainable, intelligent infrastructure—companies will streamline their operations and unlock new pathways for growth, setting a benchmark for success in the digital age.
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