U.S. businesses and consumers continue to express caution regarding spending on technology, with spots of more intensive interest around critical areas of new technology.
For a broadcast television industry investing heavily in the rollout of NEXTGEN TV, this suggests more dollars will be invested in everything from information security and cloud computing to AI, a just-released survey from S&P Global Market Intelligence shows.
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The data come from S&P Global’s US Technology Demand Indicator, a survey-backed composite of U.S. intent to spend on technology.
While U.S. tech spending intent dipped slightly in Q3, it is poised to resume positive trajectory in Q4.
And, although the S&P unit measured intent, the data gives perhaps an accurate peek into where business including broadcast television — and even radio — plan to add to their expenses in the last quarter of 2023 and into 2024.
Spending intent is poised to resume a positive trajectory across the remainder of 2024, S&P finds.
Liam Eagle, Research Director at S&P Global Market Intelligence, took a glimpse at the last three years, noting that 2021 “was a period of strong technology demand, driven by pandemic-related shifts in remote working.” Then, 2022 saw spending cuts as challenging circumstances continued. For 2023, the year has been marked by inconsistent periods of improving tech spending intent amid an overall attitude of caution.
Defining the tech products and needs examined is key to understanding the trends Eagle and his team are watching. He notes that “targeted tech spending” persists, with “the rush to understand the practical business applications of generative AI driving spending intent on the technology itself, as well as on related areas of cloud compute and data security.”
For broadcast media companies, those are key investment areas and represent what businesses are focused on with respect to technology infrastructure improvements and build-out; it does not speak of what consumers are willing to put their dollars into.
Specifically, The Q3 2023 Tech Demand Indicator score was 48.93, representing a slightly negative overall sentiment (<50), and a slight decline from a second quarter score of 49.72, which was the first positive quarter-to-quarter shift in more than a year. “The flattening out or decline of sentiment captured in Q3 appears to be a bump in a more sustained positive trajectory, as projected Q4 results suggest further improvement, and a potential shift into positive (>50) intent to spend on technology,” the S&P unit notes.
Lastly, S&P Global notes that during a current period of overall negative enterprise attitudes toward spending on technology, the shifting perspective on artificial intelligence technologies has made it one of several bright spots of positive spending intent (represented on a 100 point scale describing intent to spend), along with cloud computing and information security — two areas of connected technology. The strongest of those scores came in areas where enterprise spending is broad-ranging and consistent and decreases are uncommon — cloud infrastructure and services (66.0) and information security (63.73).
Artificial intelligence, which ranked slightly behind these in terms of positivity (61.46) and was a key topic of conversation on November 15 at the Forecast conference in New York, “is unlike those areas in that it is only now transitioning from being viewed as an emerging or experimental technology into a more critical business tool,” S&P Global concludes.
