Although industry analyst, IDC, initially forecast ICT market growth in Australia to 2016, it has had a rethink because it claims growth in the economy has been slower than expected and is impacting ICT spending.

In its Australia Vertical Markets 2012-2016 Forecast and 2H12 Update, it highlighted that the ICT market in Australia will grow from $43,408.6 million in 2012 to $49,452.6 million by 2016, achieving a compound annual growth rate (CAGR) of 3.0 per cent for the forecasted period.

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However, it lowered the ICT spending growth forecast due to factors such as fiscal consolidation, political uncertainty, the high Australian dollar and at a period close to the end of a mining boom.

But, even with the lowered forecast, the ICT industry can expect growth.

IDC Australian vertical markets analyst, David So, said the banking, finance, and insurance segments remain the largest verticals in Australia with regard to ICT spending, and will exceed the $10 billion mark this year to reach $10,684.9 million.

IDC said this vertical will experience the second fastest long-term growth in ICT spending with a CAGR of 3.9 per cent for the forecasted period.

In the communications and media front, IDC forecasts this third largest segment to register the fastest growth in terms of ICT spending with a CAGR of 4.4 per cent for the forecasted period.

"We believe that this vertical is the most exposed to disruptive technologies/innovation and thus are required to increase more of ICT spending to mitigate the risk of being disrupted by emerging businesses," So said.

He added that with the government vertical representing the second largest vertical in Australia, its ICT spending is focused on generating significant cost efficiencies by deploying Cloud-based infrastructure and a whole-of-government approach in its ICT procurement policy.

As a result, IDC has estimated the government's ICT spending to grow by a CAGR of 3.2 per cent for the forecasted period.

"When we combine these top three verticals in Australia, they together represent half of total ICT spending in Australia," So claimed.