IT services to top USD5m in SA
BUSINESS| Jan. 11, 2012, 3:31 p.m.
The IT services market in South Africa has seen healthy uptake, growing some 8% year on year in 2010 to contribute more than a third of the total IT spending in the country. Market research and advisory company IDC expects the IT services market to exceed USD5 billion in 2012.
"After the freeze in IT budgets that came about as a result of the global economic crisis, 2010 saw a rebound in IT services spending," says Suzanne Nolan, research analyst for IT Services, IDC South Africa. "The growth in IT services spending was driven by a recovering economy, increased business confidence, expanding bandwidth availability, and various infrastructure investments made in the country in 2010."
IDC said IT outsourcing constituted around 40% of the South African IT services market, which represents the largest market share of all IT services foundation markets, followed by systems integration and installation and support services. "This growth was mainly driven by discrete managed services rather than by traditional information system outsourcing contracts," says Nolan. "The healthy growth in outsourcing services signifies a level of sophistication and maturity within the IT services segment."
According to IDC, services such as network and desktop outsourcing and infrastructure hosting saw increased uptake in 2010, fuelled by the incremental supply of datacenter space and increased customer awareness of the managed services model.
IDC forecasts the total South African IT services market to expand at a compound annual growth rate of 8.7% to exceed USD17 billion in 2015.
Looking ahead, IDC expects a continued spending focus among end-user organizations on areas and solutions that help reduce operating expenses while increasing efficiency. As a result of continued price pressures and the need to improve client service, vendors are advised to pursue alternative service delivery models, such as cloud services. Not only will this help end users optimize their IT investments, but it will enable services providers to improve their quality of delivery and create new revenue streams.
MORE BUSINESS NEWS
Umati Capital secures $10m finance line from ApexPeakKenyan financial tech startup Umati Capital has agreed a deal with ApexPeak securing its first line of wholesale capital. Read More
Kirusa acquires Ghana’s Saya MobileVoice messaging and social media apps firm Kirusa has acquired Ghana-based Saya Mobile, which provides instant messaging apps geared specifically for African consumers. Read More
SAP to invest up to $500m in African innovation and growthSAP has announced a long-term commitment to regional expansion, sustainable growth and skills development of up to 10,000 IT consultants in Africa. Read More
Microsoft, UNDP partner to support Ethiopian entrepreneursMicrosoft has signed a collaborative agreement with the United Nations Development Programme (UNDP), under which Microsoft will provide training and mentorship services to 200,000 Ethiopian entrepreneurs. Read More
Location based services market to reach $43.3bn by 2019A new report from Juniper Research forecasts that the Mobile Context and Location Services market will reach $43.3bn in revenue by 2019. Read More
Garmin calls on buyers in Southern AfricaThe Africa team for Garmin Sub-Saharan Africa will be hosting meetings in Lusaka, Zambia to meet with buyers, potential resellers and business partners this month. Read More
Nomanini secures further $450k for expansionSouth African electronic prepaid service distribution platform Nomanini has received US$450,000 in funding from the IDC to expand outside of Africa. Read More
Africa offers US ‘compelling trade and investment opportunity’Africa offers US multinationals a compelling trade and investment opportunity thanks to the rapid economic growth rates across the continent, says Standard Bank. Read More
PwC investment to accelerate African growth opportunitiesPwC is increasing its investment in Africa and building closer links between PwC UK and PwC Africa, to meet increased demand for professional services as trade activity between the two regions grows. Read More
Kouros Capital Group announces multi-billion Nigerian investment planKouros Capital Group Limited (KCG) has announced that it is making immediate arrangements to bring into Nigeria substantial investment funding, for projects in telecommunications, agriculture, banking, oil and gas and aviation sectors. Read More
FEATURED STORYNigeria’s VAS providers ‘on brink of extinction’
WASPAN chief Simon Aderinlola says unless the regulator intervenes, WASPAN may not have anything left to regulate. Kokumo Goodie reports.
BEST READ NEWS
IN DEPTHKenya rolls out e-extension to improve agriculture
In a bid to curb the overwhelmed number of agricultural extension officers in Kenya, the ministry of agriculture is embracing technology with their introduction of E-Extension services, which are aimed at reaching out to over 7 million farmers annually.
COMPANY NEWSSchneider Electric trains 50,000 in energy management
Schneider Electric has trained more than 50,000 people in energy management as part of its BipBop energy access programme.