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SA’s IT spend to reach R67,2bn

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IT spending in South Africa is set to increase from the current R52,2-billion to more than R67,2-billion in 2011 – an annual CAGR (compound annual growth rate) of 5,2%. 

The is according to BMI-TechKnowledge's latest report titled Vertical Market IT Sizing and Forecast 2006-2011.
Lesley-Anne Dos Santos, IT research analyst and author of the report, says that SMEs account for the majority of South African enterprises and are increasingly forcing IT vendors and services providers to acknowledge their IT needs – as such, they are gradually increasing the value of the market.
“A vertical market strategy is becoming an increasingly important element for both IT vendors and IT service providers, as end users demand technology tailored for their industry-specific requirements," she says.
"Analysis from a vertical perspective is necessary to enable vendors and service providers to best penetrate their desired markets. The aim of this study is to provide such guidance."
owever, the bulk of South African IT spend is still coming from the larger enterprises, which comprises the finance, manufacturing, government and distribution sectors.
BMI-T expects that the financial services sector will continue to provide the largest opportunity in the South African IT market, accounting for 22,1% of the overall IT spending in 2006.  The latest assessment of the market is that organisations are scrutinising all investments (including IT investments) closer than ever, getting better return for their money. This factor could inhibit IT spend in South Africa. However, BMI-T analysts are confident that growth is still relatively strong, and that supply-side drivers will not compromise growth in the future.
The Vertical Market IT Sizing and Forecast 2006-2011 provides a comprehensive look into all the sectors in South Africa and includes an overview of the IT market broken down into macro-vertical and vertical industries. In addition to a total IT market forecast, this study also considers spending patterns and adoption trends across each of the vertical industries.