Enterprise uptake of software and services fuels overall spending increase. Credit: Evgeniy Shkolenko / Getty Images Boosted by increases in spending on enterprise software, services, data centre infrastructure and infrastructure-as-a-service (IaaS), overall IT spending in South Africa is set to rise by 2.5 percent this year from 2019, reaching US$26.4 billion, according to a new report from IDC. Spending on software and IT services will reach $8.2 billion in 2020, an increase of 4.2 percent, said Mark Walker on Friday, at the opening of the 2020 South Africa edition of the IDC Directions conference. Infrastructure spending in the country – including servers, storage, and enterprise-level networks – will increase 3.3 percent to $880 million, he said. Meanwhile, cloud uptake can be measured in part by growth in IaaS investments, which will reach $204 million, having grown at a compound annual growth rate (CAGR) of 25 percent over the last five years, IDC reported. Though the growth rate is robust, the country was starting from a low level of cloud infrastructure investment. That is beginning to change, however, as African CIOs look to the cloud as a way to curb capital expenditures and quickly scale up new services. Last March, catering to growing demand, Microsoft launched enterprise-grade cloud data centres in Cape Town and Johannesburg. Amazon Web Services is expected to launch its own hyperscale cloud data centres in the country this year. “The digital economy is at a critical tipping point,” said Jyoti Lalchandani, IDC’s group vice president and managing director for the Middle East, Turkey, and Africa, in prepared remarks at the IDC Directions event. “In just a few short years, IDC forecasts that nearly half of all GDP worldwide will come from products and services offered by digitally transformed organisations,” Lalchandani said. “In order to thrive, organisations must define their new role in this digital economy and proactively address new customer requirements around personalisation and trust. They must also develop new capabilities around digital innovation, work, and intelligence, and build a digital IT infrastructure that supports resilient operations and pervasive experiences.” Despite growth, though, obstacles to public cloud throughout Africa remain, as infrastructure, bandwidth and regulatory issues throttle cloud expansion. African enterprises, pubic administrations, telecom infrastructure providers and public cloud vendors are working hard to overcome infrastructure issues, figure out workarounds, and encourage cloud adoption and data-centre best practices. An increase in the number of hyperscale cloud providers over the next few years is expected to help enterprises tap cloud services including SaaS applications as well as compute infrastructure. Related content brandpost Sponsored by Palo Alto Networks Operational technology systems require a robust Zero Trust strategy in 2024 Zero Trust provides a foundation for creating a stronger security posture in 2024. By Navneet Singh, vice president of marketing, network security, Palo Alto Networks Dec 05, 2023 6 mins Security brandpost Sponsored by AWS in collaboration with IBM How digital twin technology is changing complex industrial processes forever As the use cases for digital twins proliferate, it is becoming clear that data-driven enterprises with a track record of innovation stand the best chance of success. By Laura McEwan Dec 05, 2023 4 mins Digital Transformation brandpost Sponsored by AWS in collaboration with IBM Why modernising applications needs to be a ‘must’ for businesses seeking growth Around one-third of enterprises are spending heavily on application modernisation and aiming for cloud native status. The implications for corporate culture, structure and priorities will be profound. By Laura McEwan Dec 05, 2023 5 mins Digital Transformation opinion 11 ways to reduce your IT costs now Reorienting IT’s budget toward future opportunities is a big reason why CIOs should review their IT portfolios with an eye toward curbing unnecessary spending and realizing maximum value from every IT investment. By Stephanie Overby Dec 05, 2023 11 mins Budget Cloud Management IT Governance Podcasts Videos Resources Events SUBSCRIBE TO OUR NEWSLETTER From our editors straight to your inbox Get started by entering your email address below. Please enter a valid email address Subscribe