" ITREALMS: IT services spending hits N1.35tr in South Africa in 2019

Thursday, September 10, 2015

IT services spending hits N1.35tr in South Africa in 2019

The International Data Corporation (IDC), the premier global provider of market intelligence and advisory services has said it expects Information Technology (IT) services spending in South Africa to reach $6.8 billion, about N1.35 trillion in 2019, ITRealms gathered.

According to a press release forwarded to ITRealms, Information systems consulting will be the fastest growing service, expanding at a compound annual growth rate (CAGR) of 13.7per cent, as organizations seek guidance on how best to incorporate 3rd Platform technologies like cloud, social, and mobility so as to gain an edge in the increasingly competitive marketplace. The other top-performing services in terms of growth over the forecast period will be application consulting and customization (12.6 per cent) and combined systems integration (12.4 per cent).

ITRealms learnt that IT services spending in South Africa is expected to increase 8.8 per cent year on year in 2016 to total $5 billion about N995.2 billion, according to the latest forecasts from International Data Corporation (IDC). Referencing its recently published report, 'Africa IT Services Market 2015–2019 Forecast and 2014 Vendor Shares', the global research and consulting firm recently said it expects outsourcing services to continue to garner broad appeal as companies increasingly look to limit and predict their costs and optimize their current investments.

The considerable shifts in the rand/USD exchange rate are having a significant impact on the local IT services market. Spending on IT services in 2014, for instance, declined 1.5per cent year on year in U.S. dollar terms, but when measured in the local currency, it was up 10.7per cent over the same period.

The IDC's research manager for software and IT services in Africa, Lise Hagen, said "The increasing demand for innovative solutions to common operational challenges is a priority for decision makers when purchasing IT services. An increasingly mobile workforce will have a significant impact on purchases spanning the whole technology stack of software, hardware, and IT services."

Cyriacus Nnaji/GEEs
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