December 20, 2016

Trump’s tariff threat may speed cloud adoption: Computerworld

Anticipating increased costs, IT managers may boost cloud presence in the country

According to an article on Computerworld, analysts say that President-elect Donald Trump’s threat to impose tariffs on goods manufactured in Mexico and offshore may cause an increase in the movement to cloud computing. Throughout the campaign, Trump has reportedly said that he intends to impose a 35% tariff on goods made by any company that leaves the U.S. and then intends to sells its products back in the U.S.

According to Patrick Thibodeau, Senior Editor of Computerworld :

IT managers may seek to protect their companies from higher hardware or capital expenditure costs by shifting more of their IT spending to services.

This shift is well underway, and the new administration may push it along, even before Trump takes office next month.

At of now, industry analysts are uncertain about Trump’s plans regarding his statements as they are mostly short, vague and sometimes delivered by tweets. However, John Lovelock, an analyst at Gartner stated that if Trump’s threatened tariff only applies to industries that shift work to Mexico or offshore after the new President takes office, then it won’t affect the IT industry all that much.

The article also said :

Many companies that sell servers here are not U.S. companies, such as Fujitsu, Hitachi, Lenovo, NCR, NEC and Huawei, among others. U.S.-based companies, notably Hewlett-Packard Enterprise and Dell, have been making hardware overseas for years.

Then there are the tech vendors, for both enterprise and consumer markets, that have never manufactured their products in the U.S., but instead have contracted with manufacturers in China and elsewhere. These products include Apple’s iPhones, which are assembled in China.

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