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Kathy Gibson at IDC Directions in Sandton – Cloud and data centre conversations tend to focus around the core question of how to achieve digital transformation.

“The most important message is that there is a still a balance between on-premise data centres and the cloud,” says Jon Tullett, research manager for IT services: sub-Saharan Africa at IDC.

In South Africa, the spend on infrastructure as a service (iaaS) is set to grow by 15,7&, with high-end servers set to actually retreat to -5,2%.

Cloud spend will grow 18,4% to reach $323,75-million, compared to 23,4% growth in the Middle East Africa region, where it will reach $1,558-bilion.

Softwar as a service (SaaS) is street ahead of on-premise, averaging eight-times the level.

Several workloads are passing a 50% share in SaaS versus on-premise, although this doesn’t mean on-premise is dead, Tullett adds.

IaaS is growing a 20,4% CAGR versus a 7,6% growth in hosting services. However, traditional hosting still dominates and 16% of all IaaS spending.

“We have started talking about hybrid IT, as more organisations embrace a mix between private and public cloud technologies,” Tullett points out.

“This is now relatively common; we are seeing a lot on on-premise software now augmented with pubic cloud services.”

IDC’s MaturityScape for digital transformation describes five stages that organisations pass through: ad hoc; opportunistic; repeatable; managed; and optimised.

“Globally, there is a fairly steep bell curve, with most organisations still stuck in the middle, Tullett says. South African companies are still largely in the first half of the curve, but are moving up quickly.

IDC predicts that, by 2020, 67% of all enterprise IT infrastructure and software spending will be in cloud-based offerings.

By 2020, more than 70% of cloud service providers’ cloud revenue will be mediated by the channel.

By 2018, 85% of all enterprise IT organisations will commit to multi-cloud architectures.

Right now, very few South African enterprise ae actively deploying a hybrid cloud approach.

Many enterprise are deploying to single cloud provides today, but they do not intend to commit to an all-in strategy.

The key drivers for a multi-cloud strategy include a need to align cloud strategies with data centre investment along with a fear of vendor lock-in.

Tullett stresses that local IT providers need to change their own business processes and offerings.

As large provider enter the market, local providers will be impacted at the same time, these new players are also opening up new market opportunities

He suggests that local partners develop a broad range of cloud partnership, that they consider vertical market specialisations.

Although localisation will diminish as a differentiator, it will still be a factor in successful cloud engagement, he says.