International Data Corporation (IDC), in a report, predicts that South Africa will be spending a total of $13 billion on IT by 2015.
The leader of the pack will be consumer, finance, and government verticals, with the former expected to account for $3.12-billion in IT spending during 2015. The will, however change in the coming years as the vertical will stagnate, with spending dipping slightly to $3.10-billion in 2018.
The second best vertical still under IT spending is the banking, insurance, and securities and investments industries, with a total expenditure of $1.88-billion.
The primary driver for growth in this sector will be increased investments in mobility and security. As the growth opportunities from traditional channels and business are declining, banks in South Africa are shifting their focus to the unbanked, and mobile is the most sought-after channel for serving the unbanked due to its already-high and increasing levels of penetration in South Africa.
Spending in the government sector is predicted to reach $1.63-billion in 2015, driven by ongoing automation initiatives as part of the drive to bring government services to online and mobile platforms.
Meanwhile, IT investment in the country’s telecommunications vertical is expected to total $1.42-billion in 2015.
Similar to banks, telecom players are faced with high competition and low growth in their traditional sphere of business, resulting in them foraying into neighboring fields such as IT services and financial services. Telcos are adding cloud computing, data centre, and disaster recovery services to their product and services portfolios, and also targeting the unbanked through payment-related services.
“The economic situation in South Africa remains fragile, owing to electricity shortages and strikes in the mining, manufacturing, and utilities sectors,” says Jebin George, a senior research analyst at IDC Middle East, Africa, and Turkey. “However, IDC expects IT market in the country to remain buoyant and continue to grow during the next four years. The consumer, finance, communications, and government sectors will remain the biggest IT spenders, while the fastest growing verticals over this period will be transportation, utilities, and healthcare.”