Artificial intelligence (AI), multi-cloud technologies and data systems will lead IT investments planned for the next 12 months in the Sub-Saharan Africa region.
However, planned investment in security has slumped to 13th place out of the 15 technologies planned to attract investment in this financial year.
This was revealed by Mark Walker, IDC associate VP of data and analytics in the Middle East, Turkey and Africa region, during his presentation at the IDC Directions 2024 event yesterday.
Rounding up the 15 technologies are: automation, integration tools, microservices, operational technology, digital device sustainability/circularity, application operations, programmable infrastructure, APIs, network and connectivity, front-office software applications and back-office applications.
While there are great investment plans for AI, multi-cloud, data systems, etc, Walker commented it’s concerning that security is pretty low down on the priority list. “If we compare security to the EMEA levels, in EMEA it is sitting halfway up.
“There might be a bit of complacency that needs to be addressed quite sharply.”
South Africa still has impressive ICT spending growth despite economic conditions, he revealed.
Based on figures presented yesterday, the total market for the African region is expected to reach $143 billion by the end of 2027. This is up from the current value of $112 billion.
South Africa accounts for the biggest growth on the continent, with a 6% increase year-on-year, outpacing the gross domestic product, Walker indicated.
“There’s still a healthy rate of consumption and it’s coming from enterprise businesses, big banks, industrial companies and government. This is where there’s still a bulk of spend.
“A lot of the spend will be towards AI, recovery spend as a result of the COVID-19 period, hardware, IT services and telecoms services, especially as telcos move from being telecommunications providers to communications-based service providers.”
Walker revealed Sub-Saharan Africa (excluding South Africa) will experience growth gains. Meanwhile, growth in other African territories is expected to remain slow right through to 2027, due to volatility across some of the regions.
A lot of the South African technology outlook is still driven by cloud consumption, with telecoms services, software and IT services still representing a big chunk.
The lowest growth is in the hardware sector, he said, adding that cyber security, together with cloud, still holds a big chunk in terms of driving growth across all technologies.
Big spenders
Drilling down to industries, Walker noted the finance sector still represents a huge amount of spending in the enterprise IT market.
IDC anticipates strong spend for the sector at R30 billion, with 11% growth. “A lot of it is run rate and a lot is focused on the security aspects.
“The increase of cloud and use of remote tools have increased security threats towards the banks…there is a lot of phishing and a variety of scams. Banks are spending a lot of money on hardware, software and services related to that. Finding the skills in those areas is difficult.”
The finance sector is followed by government, which is anticipated to up spend this year. Government represents a slower growth rate at 7%.
According to Walker, government spend this year will be interesting. “Typically, there is some opportunistic spend…to make sure those still in power are shown to be making a difference. For example, spend is allocated to make WiFi available in various places, etc.
“There will be some of that bump in spend this year. Overall, government is starting to wake up to the fact that…there needs to be a focus on the relevance of technology and its benefits to the general population and the economy at large.”
The energy and resources sector is also witnessing IT spending growth. “Power utility Eskom is using AI and surveillance to root out the corruption that’s been associated with it.”
Other big spenders include the communications, manufacturing and retail and wholesale sectors, he added. “In the retail space, AI is a big thing, but traditional application technology to manage the retail stores and retail chain is becoming far more sophisticated.”
From a cyber security point of view, Walker revealed purchases remain tactical in 2024, amid growing fears.
Local CISOs say purchases are mainly towards incident management and response (81%). This is followed by tracking cyber security metrics at 56%.
Improving visibility of IT, OT and IOT assets; managing users, identities and access; as well as improving security awareness culture are at 53%, 48% and 45%, respectively.
“When it comes to budgeting time and sitting around the table, often the question from the CFO or CEO will be why increase the security budget if there wasn’t a hack or compromise. The question isn’t why we weren’t hacked. We weren’t hacked because we spent money to not get hacked and would be spending a lot more if it did happen.
“There’s a disconnect that needs to be addressed…there needs to be better engagement and justification of the importance of security spending for the business.”
Share