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Egham, U.K., July, 24, 2019

Gartner Forecasts IT Spending in South Africa Will Grow 3.9% in 2019

Cloud Computing Is a New Reality in South Africa

IT spending in South Africa will total R303.46 billion in 2019, a 3.9% increase from 2018, according to Gartner, Inc.

“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,” said John-David Lovelock, distinguished research vice president at Gartner.

Consumer spending was once the IT spending highlight in South Africa, driven by adoption of mobile phones, but no longer. Gartner expects consumer spending on devices — PCs, tablets and mobile phones — to decline by 2020, and to keep contracting through 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,” said Mr. Lovelock.

Spending on devices in South Africa is projected to total R46 billion in 2019, up 3% from 2018 (see Table 1). This growth rate has more than halved, year over year, which shows that South Africa has largely moved past the stage of acquiring personal devices and is now more concerned with using them.

Table 1. South Africa: IT Spending Forecast (Millions of Rand)

 

2018
Spending

2018
Growth (%)

2019
Spending

2019
Growth (%)

2020 Spending

2020
Growth (%)

Communication Services

129,837

3.2

132,852

2.3

133,572

0.5

Data Center Systems

9,053

16.1

8,598

-5.0

8,898

3.5

Devices

44,615

7.5

45,966

3.0

40,328

-12.3

IT Services

79,685

4.9

83,897

5.3

87,996

4.9

Software

28,849

12.9

32,147

11.4

35,850

11.5

Total

292,040

5.6

303,460

3.9

306,644

1.0

Due to rounding, figures may not add up precisely to the totals shown.

Source: Gartner (July 2019)

Adoption of Cloud Computing Will Keep Rising in South Africa

Software spending in South Africa will reach R32 billion in 2019, a 11.4% increase from 2018. “Cloud computing is a new reality in South Africa,” said Mr. Lovelock. “South African organizations 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.”

CIOs have to decide whether to build on-premises data centers or use the public cloud — and the cloud is prevailing. “With both Microsoft and Amazon planning to open local hyperscale data centers in 2020, adoption and use of the cloud will only increase in South Africa,” concluded Mr. Lovelock.

More detailed analysis on the outlook for the worldwide IT industry is available in the complementary webinar “IT Spending Forecast, 2Q19 Update: Market Disruptions and the Disruptors.”

Gartner’s IT spending forecast methodology relies heavily on rigorous analysis of sales by thousands of vendors across the entire range of IT products and services. Gartner uses primary research techniques, complemented by secondary research sources, to build a comprehensive database of market size data on which to base its forecasts.

Gartner’s quarterly IT spending forecasts offer a unique perspective on IT spending across the hardware, software, IT services and telecommunications segments. They help Gartner clients understand market opportunities and challenges. The most recent forecast is available to Gartner clients in “Gartner Market Databook, 2Q19 Update.”

Additional analysis of the future of the IT industry will be presented during Gartner IT Symposium/Xpo 2019 events, the world’s most important gatherings of CIOs and other senior IT executives. IT executives rely on these events to gain insight into how their organizations can use IT to overcome business challenges and improve operational efficiency. Follow news and updates from the events on Twitter using #GartnerSYM.

Upcoming dates and locations for Gartner IT Symposium/Xpo include:

September 16-18: Cape Town, South Africa

October 20-24: Orlando, Florida, U.S.

October 28-31: Gold Coast, Australia

October 28-31: São Paulo, Brazil

November 3-7: Barcelona, Spain

November 11-14: Goa, India

November 12-14: Tokyo, Japan

About Gartner

Gartner, Inc. (NYSE: IT), is the world’s leading research and advisory company and a member of the S&P 500. We equip business leaders with indispensable insights, advice and tools to achieve their mission-critical priorities today and build the successful organizations of tomorrow.

Our unmatched combination of expert-led, practitioner-sourced and data-driven research steers clients toward the right decisions on the issues that matter most. We are a trusted advisor and objective resource for more than 15,000 organizations in more than 100 countries — across all major functions, in every industry and enterprise size.

To learn more about how we help decision makers fuel the future of business, visit gartner.com.

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