South Africa is one of the fastest-growing countries globally for IT spend

 ·24 Jul 2019
Cloud archiving

IT spending in South Africa is expected to total R303.46 billion in 2019 – a 3.9% increase from 2018, according to advisory firm Gartner Inc.

“South Africa is still behind in terms of overall IT spending and continues to have a technology debt to pay off. However, by achieving 3.9% growth in 2019, South Africa will be one of the fastest-growing countries in the world — ranked fourth globally,” said John-David Lovelock, distinguished research vice president at Gartner.

Consumer spending was once the IT spending highlight in South Africa, driven by adoption of mobile phones, but no longer. Gartner expects consumer spending on devices — PCs, tablets and mobile phones — to decline by 2020, and to keep contracting through 2023.

“Saturation in the PC, mobile phone and tablet device markets has limited the number of new buyers. And spending on mobile phone replacements and upgrades won’t be enough to sustain current spending levels,” said Lovelock.

Spending on devices in South Africa is projected to total R46 billion in 2019, up 3% from 2018 (see Table 1). This growth rate has more than halved, year over year, which shows that South Africa has largely moved past the stage of acquiring personal devices and is now more concerned with using them.

Adoption of Cloud Computing Will Keep Rising in South Africa

Software spending in South Africa will reach R32 billion in 2019, a 11.4% increase from 2018. “Cloud computing is a new reality in South Africa,” said Lovelock. “South African organisations are consuming significant amounts of cloud services, including software as a service, platform as a service and infrastructure as a service. CIOs in South Africa have started adopting cloud-first strategies.”

CIOs have to decide whether to build on-premises data centres or use the public cloud — and the cloud is prevailing. “With both Microsoft and Amazon planning to open local hyperscale data centres in 2020, adoption and use of the cloud will only increase in South Africa,” said Lovelock.

Gartner’s IT spending forecast methodology relies heavily on rigorous analysis of sales by thousands of vendors across the entire range of IT products and services. Gartner uses primary research techniques, complemented by secondary research sources, to build a comprehensive database of market size data on which to base its forecasts.

Read: Capitalising on the cloud and emerging technologies like 5G in South Africa

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