IT spending in South Africa forecasted to grow 3.9% in 2019

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It is that time of the year again when research firm Gartner runs through its predictions as far as IT spending goes. Globally the firm has forecasted a relatively flat growth of 0.6 percent in 2019, and has now turned its attention to South Africa.

To that end Gartner is predicting a higher growth of 3.9 percent this year, with the total expenditure estimated at R303.46 billion.

Should South Africa reach this anticipated growth, it would be quite the feat according to the research firm.

“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,” explains John-David Lovelock, distinguished research VP at Gartner.

As for what some of the key factors in SA’s IT spending will be, Lovelock points to a shrinking consumer spend market, which will decline in 2020 as fewer people buy new smartphones and personal computing hardware, with it expected to continue through to 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,” adds Lovelock.

While spending on devices is expected to total R46 billion in 2019, which represents a 3 percent growth compared to 2018, it’s half the year-on-year growth rate achieved the previous year.

“South Africa has largely moved past the stage of acquiring personal devices and is now more concerned with using them,” notes Gartner.

With device spend dropping, the factor pushing IT in SA is cloud computing, and in particular software spending at a forecasted amount of R32 billion, which is an 11 percent increase form last year.

“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,” the Gartner research VP points out.

CIOs have to decide whether to build on-premises data centres or use the public cloud, and the cloud is prevailing, the firm adds.

Added to this is the fact that both Microsoft and Amazon Web Services will have hyperscale data centres operating locally in 2020, and cloud adoption is expected to see a sharp rise over the coming months.

These latest findings will be unpacked in greater detail by Gartner during its annual IT Symposium/Xpo in Cape Town later this year.

[Image – Photo by Jacques Nel on Unsplash]