2024 Technology Industry Outlook (Deloitte)

Summary

• Predictions for growth in global IT spending in 2024 cover a range from 5.7% to 8%.p.4
• Deloitte's analysis pegs the risk of a US recession in 2024 at just 20%, while economists put it below 50%.p.4
• Analysts estimate that public cloud spending will grow by more than 20%, and they foresee stronger demand for cybersecurity.p.4
• In a Q4 2023 Deloitte survey, tech leaders put AI (52%), cloud computing (47%) and cybersecurity (40%) at the top of technologies expected to enable the most growth.p.5
• 44% of professional developers are already using AI tools in their development process, and another 26% plan to do so soon.p.8
• Productivity gains from generative AI in software development are reported in the 10% to 30% range.p.8
• The OECD's Pillar Two global minimum tax is designed to ensure multinational corporations pay a minimum of 15% regardless of location.p.10

Key insights

1. Tech M&A deal volume and total market value remain well below 2021 highs, and 2023 proved disappointing for tech M&A.p.5
2. Deloitte expects generative AI growth in 2024 to be modest, with adoption and spending picking up in the second half.p.5
3. Supply chain resilience is critical, and tech giants are diversifying their manufacturing and development locations and reducing reliance on single suppliers or countries.p.6
4. The EU's AI Act is expected to be adopted in the second quarter of 2024, with a 24-month implementation period for most obligations.p.8
5. The EU's Digital Services Act and Digital Markets Act affect the largest tech companies, with the DMA requiring platforms to eliminate practices that stifle competition.p.9
6. A California law requires climate disclosures from any company with revenues greater than US$1 billion doing business in the state.p.10
7. Regulatory developments could drive increased investment in cybersecurity, data management and ESG reporting solutions.p.10
8. Valuation corrections may fuel renewed interest from venture capitalists and corporate buyers, and the 2023 uptick in tech IPO activity could signal a positive trend.p.4