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Modest growth for SA services market

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The South African IT services market reached a value of R47,4-billion in 2014, reflecting a year-on-year growth of 4,8%, according to the IT Services Market report released by BMI-TechKnowledge.
This was in an environment of rapid convergence of IT and telecoms, which was reflected in significant ICT corporate consolidation.
The three largest players in the IT services market, each with approximately 14% market share, were Dimension Data, Business Connexion and EOH. The latter continues to grow significantly through a combination of organic growth and acquisition.
Clinton Jacobs, senior IT analyst at BMI-T, says that the public sector had a notable impact on the fortunes of many players in the IT services arena with some major contract renewals and extensions.
“Indian system integrators are also making their presence felt in South Africa,” says Jacobs. “Several Indian companies have experienced good growth and significant wins in a variety of market segments such as banking, telecoms and mining.”
Double digit growth areas in IT services in 2014 were custom application development, training and system integration.
The IT services market is expected to grow at a CAGR of 7,4% over the five-year forecast period, reaching a total of R67,7-billion by 2019, driven by the continued pressure on companies to reduce costs and become more lean, as well as by the impact of mega trends such as IoT (Internet of things) and Hybrid Cloud computing.