Business | Technology
IT spending in Middle East and Africa to exceed $40b this year
IT spending in the Middle East and Africa (MEA) will cross $40 billion (Dh146.8 billion) in 2008 and the six Gulf countries will account for nearly 23 per cent of that total, an industry research firm said.
- By Naushad K. Cherrayil, Senior Sub-Editor
- Published: 23:22 March 1, 2008
Dubai: IT spending in the Middle East and Africa (MEA) will cross $40 billion (Dh146.8 billion) in 2008 and the six Gulf countries will account for nearly 23 per cent of that total, an industry research firm said.
"While we are documenting continued growth in investments around building IT infrastructure, namely systems, PCs, storage, peripherals and networking equipment, spending in packaged software [enterprise applications, security and storage, network and systems management] and IT services is picking up nicely, at least in the mature Gulf markets," said Jyoti Lalchandani, vice-president and regional managing director of IDC Middle East and Africa.
Market figures
IDC expects the Gulf information technology market to cross $12 billion (Dh44 billion) by 2011, representing a growth of almost 12 per cent.
The latest IDC research indicates that total IT spending in the Gulf will exceed $9 billion (Dh33 billion) in 2008, more than 15 per cent up compared to 2007.
Saudi Arabia is the largest market in the region, comprising 43 per cent of the overall IT spending, followed by the UAE with 36 per cent, Kuwait with nine per cent, Qatar with five per cent, Bahrain with four per cent and Oman with three per cent. Saudi Arabia and the UAE will represent the fastest growing markets in the Gulf in 2008.
Last year IT spending in the Gulf stood at $7.92 billion (Dh29 billion). The hardware market was 62.1 per cent, followed by services sector at 24.3 per cent and packaged software at 13.6 per cent.
"IDC is witnessing growth across the board, given large-scale infrastructure investments in several sectors in the region. The most notable expansion in IT spending over the next three-five years will be around healthcare, hospitality, retail and education," Lalchandani said.
Growth opportunities
"Of course, large enterprises in banking and financial services, telecommunications, oil and gas, and the public sector, will continue to account for the bulk of IT spending. The home and small- and medium-scale segment represent interesting growth opportunities moving forward," he said.
IDC believes that the next IT area ripe for a service-orientated overhaul is infrastructure, including equipment, facilities, and management systems.
Traditionally, integration between these elements has been limited. But if IT infrastructure elements could be integrated and the functions of those elements could be delivered over a network connection, the result would be enterprise IT functions that is more responsive, cost-effective, manageable, reliable, secure and compliant.
Lalchandani said the IT infrastructure as a service model presents a compelling alternative to conventional approaches.
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