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South Africa’s Cloud Subscriptions to Reach $1.7bn, shows Research

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Jenna Delport
Jenna Delport
I’m a tech writer, world traveller, avocado-eater and dog lover, not always in that order.

Cloud-computing annual subscriptions in South Africa will grow 29% annually, from $370 million in 2018 to $1.7 billion in 2024, according to research from market intelligence firm IDC. Spending on non-cloud software is also expected to decrease by 4% annually over the same period.

Cloud computing is growing exponentially, the research found, driving economic benefits in South Africa. It is generating incremental value for companies through enabling lower investments in IT maintenance and improvements, which currently comprise 70% of IT spend, and democratising innovation.

IDC’s forecasts show a significant payback from investments in cloud computing out to 2024. But even by then, spending on public cloud computing in South Africa will be less than 11% of spending on total IT.

“With this sanitary emergency, we realised that digital is becoming more and more important. In fact, according to IDC’s global forecast of today’s market for digital transformation-related technology, by 2024 nearly 50% of cloud software spending will be tied to digital transformation,” says Petra Jenner, GM and Senior VP for Europe, Middle East, and Africa Emerging Markets at Salesforce.

“Salesforce’s rapidly growing economic impact in South Africa – with $2.1 billion in revenue and 12 140 jobs by 2024 – shows that organisations and channel partners are delivering innovative digital business models to foster new levels of employee and customer experiences and business competitiveness.”

Because organisations that spend on cloud computing subscriptions also spend on ancillary products and services, in 2019 for every dollar Salesforce made in South Africa, the ecosystem made $4.75 – and that figure will increase to $7.03 by 2024. In other words, the Salesforce ecosystem in South Africa in 2019 was 4.8 times larger than Salesforce itself. By 2024, it will be more than seven times as big.

Edited by Jenna Cook
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