26 Jan 2017

Istanbul – ICT spending in Turkey is forecast to total $22.3 billion in 2017, according to the latest insights presented recently by International Data Corporation (IDC). Hosting its annual 'IDC Predictions' event at Microsoft Türkiye's headquarters in Istanbul, the global technology research and consulting services firm gathered the country's leading CIOs and ICT vendors together to talk about their investment plans for the year ahead.

"The digital transformation efforts of the country's biggest-spending organizations will continue in 2017, albeit at a slower pace than initially planned," says Nevin Cizmeciogullari, IDC's country manager for Turkey. "The need for greater cost optimization – mainly due to constrained IT budgets – will also drive spending around software and IT services, while infrastructure spending in the telecommunications, finance, healthcare, education, and retail sectors – as well as by some public departments – will continue to move forward in 2017."

IDC expects Turkey's IT market to total $10.9 billion in 2017, matching the 1.9% year-on-year growth rate seen in 2016. Reducing CAPEX will be a major priority for all organizations, and this situation will see OPEX-driven business models such as cloud and outsourcing services gain increasing favor. As such, the IT services and software segments will be the fastest-growing segments of the Turkish IT market in 2017, with IDC forecasting year-on-year growth rates of 7.1% and 6.2%, respectively.

In terms of industries, IDC expects the healthcare, utilities, and transportation sectors to see the highest rates of spending growth in 2017, while communications, finance, manufacturing, and government will be the year's biggest spenders. The retail sector will face a challenging year as profitability concerns lead some market players to downsize their operations, either by reducing their headcounts or decreasing their number of branches (or both).

IDC predicts five overarching trends that will shape Turkey's investment landscape in 2017 and beyond:

• Cloud will accelerate to a new level of adoption in 2017, with increased competition among cloud providers set to drive aggressive pricing, bundling, and customer service.
• Big data analytics will become increasingly more predictive than descriptive in nature, driving new use cases around exploration and discovery, performance management, and operational intelligence.
• Maintaining security will continue to be the primary challenge facing the country's CIOs, with spending on security solutions by Turkish organizations set to cross the $230 million mark in 2017.
• Digital transformation efforts will continue to gain momentum in Turkey, with IDC research showing that nearly 70% of organizations in the country are already planning or about to start such initiatives.
• Smart city initiatives will take on a more pragmatic approach in 2017, with governments and their partners looking to enable innovative transportation, citizen engagement, and emergency response services that drive tangible improvements in the lives of their residents.

Speaking at the event, Microsoft Türkiye's general manager, Murat Kansu, explained that artificial intelligence is set to be one of the most important drivers of the digital transformation era: "At Microsoft, our vision for AI is formed by four primary components: redefining the way people interact with applications and computers through natural communication methods; ensuring that applications become even more intelligent; driving the use of AI technologies by software developers; and building the world's biggest super computer in the cloud.

"Accordingly, we have three main targets in 2017: firstly, to create a minimum of three regional success stories in the three key sectors of finance, manufacturing, retail, healthcare, automotive, and government; secondly, to infuse AI innovation best practices into the fabric of Turkey's startup and entrepreneurship ecosystem; and thirdly, to support high school and university students in the development of critical AI and big data skills in order to boost the pool of qualified manpower in this area."

Among the other respected thought leaders discussing their own predictions and investment plans for the year ahead were Ali Fuat Çötelioğlu, CIO, Borusan Holding; Kerim Tatlıcı, IT group manager, Migros; İlker Arabacı, executive vice president for IT and digital channels, Eureko Sigorta; Serkan Öztürk, senior vice president, Turkcell; Önder Kaplancık, IT director, Carrefour; Cengiz Arslan, CIO, Yapı Kredi Bank; Dilek Duman, COO, Denizbank; Mehmet Nalbantoğlu, general manager, Koçsistem; C. Müjdat Altay, CEO, Netaş; Defne Tozan, country manager, IBM; Güngör Kaymak, general manager, HPE; Sinan Dumlu, general manager, Dell EMC; Zeynep Keskin, managing director, SAP; Serdar Yokuş, country manager, Huawei Enterprise; and Cenk Kıvılcım, general manager, Cisco.