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Brazilian IT market gathers momentum in 2018

Projects related to Internet of Things, analytics, artificial intelligence and cloud computing will drive business demand, says IDC.
Written by Angelica Mari, Contributing Writer on

The end of the recession appears to be in the horizon for the Brazilian IT market as predicted growth could reach 5.8 percent in 2018, according to the annual forecast for the sector by analyst firm IDC.

Even the usual uncertainties of electoral years - the country will choose its next president in October - technology decision makers are investing again, driven by the pressure to digitally transform their businesses.

"Last year we warned that it was no longer possible to postpone transformation and innovation projects, and now, with a calmer and more predictable economic scenario, we are stressing not only Brazil's need but also the urgency to resume its investments in technology," says IDC Brazil's country manager, Denis Arcieri.

One of the highlights in terms of trends described in the IDC report is the rise in Internet of Things (IoT) initiatives, which should generate about $8 billion in business this year. Local corporate interest in the IoT scene is largely driven by the government's national IoT plan - within the plan there are initiatives focused on health, manufacturing, agriculture and urban infrastructure. The projects should also integrate other emerging technologies such as blockchain and artificial intelligence.

Another key topic in the IDC forecast which will be among the priorities of local companies is Big Data and analytics. According to IDC Brazil's research and consulting manager for software and services, Luciano Ramos, Brazil has matured considerably in that front and "companies now have a purpose" when it comes to data strategies.

Within the business of Big Data and analytics in Brazil, predictions are also optimistic: in 2018, consultancy services related to these projects will grow about 18 percent in comparison to 2017, and total spending by organizations including infrastructure, software and services will reach $3.2 billion.

Cognitive computing projects will also become much more frequent in Brazil this year. According to IDC, investment in the field is still currently timid, but growth should exceed the figures seen in 2017 by 50 percent. The tendency, IDC says, is that other verticals - beyond financial services and health - will invest in artificial intelligence for customer services and engagement.

The public cloud market will also perform well in Brazil, according to IDC, with contracts around infrastructure, platform and software as a service for public cloud reaching $ 1.7 billion in 2018 and practically doubling by 2020.

In addition, performance and availability demands put pressure on companies to have an infrastructure with high reliability levels and low response time. This, according to the analyst firm, will also generate additional demand for datacenters and other IT solutions.

Still regarding cloud, IDC Brazil confirms that the multi-cloud approach is a reality in Brazil.

"The number of medium and large companies that have only one provider is practically equal to that of companies using more than one provider, and hybrid solutions will continue to predominate in the coming years in Brazil," says IDC Brazil analyst Pietro Delai.

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