South Africa Cloud Computing Market | Analysis 2019-2031

South Africa Cloud Computing Market by Service Model (Infrastructure as a Service, Platform as a Service, Software as a Service), Deployment Model (Public Cloud, Private Cloud, Hybrid Cloud), Enterprise Size (Startups & Small Businesses, Mid-Sized Companies, Large Enterprises), Subscription Model (On-Demand Subscription, Committed Use Subscription, Package Subscription, Hybrid Subscription), End User (IT and Telecom, Media and Entertainment, Energy and Power, Transportation and Logistics, Healthcare, BFSI, Retail, Manufacturing, Government, Education, and Others) – Industry Analysis, Size and Forecast, 2019-2031

Avalibale Format*:   Pivot  |  ReportID: CCT1534  |  Coverage: COUNTRY | Type: Industry Tracker
Category: Information Technology  |  Sub-Category: Cloud Computing Technology
Published Date: February 2024   |  US$290  |

SOUTH AFRICA CLOUD COMPUTING INDUSTRY SNAPSHOT

  • The South Africa cloud computing market is poised to achieve US$ 4.64 billion in revenue by 2023, driven by an anticipated Compound Annual Growth Rate (CAGR) of 13.78% from 2023 to 2031.
  • Industry analysts predict that in South Africa, the primary segment by service models, is set to be Software as a Service (SaaS), boasting a market value of US$ 7.40 billion by 2031.
  • When considering end users, it's projected that 22.62% of the total market size in the South African cloud computing market will be attributed to IT and Telecom end user by 2031.
  • Industry specialists anticipate that throughout the forecast period, the IT and Telecom sector will undergo the most rapid expansion in terms of revenue generation, with a 14.40% Compound Annual Growth Rate (CAGR).

SOUTH AFRICA CLOUD COMPUTING INDUSTRY SCENARIO, TRENDS, AND DEVELOPMENTS

Cloud computing technology has taken South African industries by storm, delivering a wide range of advantages to businesses and fuelling digital transformation across various sectors. With increasing migration of South African organizations towards cloud is escalating the demand for cloud computing services in the country. According to DataCube Research analysis, more than 90% of enterprises are concentrating on developing cloud strategy and are deploying cloud-based solutions and services to enhance IT infrastructure flexibility, scalability, and reduce operation cost. This, in turn, is fuelling growth of the South Africa cloud computing market. Currently, over 60% of enterprises have already adopted cloud computing technology and less than 20% organizations in South Africa are reluctant to migrate to cloud owing to lack of IT and data centre infrastructure and budgetary issues. However, enterprises in the country are inclined more towards following operational expenditure business model rather than capital expenditure business model. This, is expected to increase penetration of cloud services among end users in the country, thereby, promoting South Africa cloud computing market growth.
 

The key challenges faced by end user organizations while migrating to cloud model are cost optimisation post migration, selecting the right cloud service provider, managing applications post migration, and deciding which all process to shift to the cloud and determining the order workloads to be migrated to the cloud. These factors are hampering growth of the South Africa cloud computing market. However, demand for cloud services is anticipated to expand as end user enterprises in South Africa are increasingly focused towards digital transformation initiatives. Additionally, there are notable developments and trends present in the South African cloud computing industry.
 

  • The South African government has been highlighting importance of cloud computing and is actively emphasizing on introducing supportive initiatives to encourage widespread adoption cloud-based business model. Notably, the implementation of the South African Cloud Computing Policy Framework offers comprehensive guidelines and strategic recommendations aimed at facilitating the seamless integration of cloud technologies across governmental and private sector entities alike.
     
  • In October 2023, BCX, a digital systems integrator, has introduced the Africa Local Public (ALP) cloud service in partnership with Alibaba Cloud. The service is designed to provide cutting-edge technology solutions to businesses throughout the continent.
     
  • As South Africa cloud computing market continues its upward trajectory, Google is making significant strides to bolster cloud infrastructure in the country. In October 2022, the tech giant announced plans to construct a network of interconnected sites across Nairobi, Cape Town, Johannesburg, and Lagos, aiming to seamlessly integrate on-premise networks into Google's cloud platform. This strategic move is aimed at fostering digital innovation and connectivity across Africa's emerging tech hubs.
     
  • Prominent players operating in other major countries such as US are eyeing to enter South Africa cloud computing market through strategic partnerships and acquisitions. For instance, in August 2022, Teraco Data Environments, a South Africa-based colocation data centres and interconnection platforms provider, declared its acquisition by Digital Realty, a California based cloud computing and data centre firm.

SOUTH AFRICA CLOUD COMPUTING MARKET COMPETITIVE LANDSCAPE

In recent years, South Africa has witnessed prominent companies venturing into country’s cloud computing arena. Giants such as Amazon, Microsoft, Huawei, and Google have all established cloud regions within the country. With the introduction of these cloud regions, end user enterprises and developers gained the opportunity to host their applications and data locally, through renowned service providers. This move not only bolstered the accessibility of cloud services but also underscores the growing significance of South Africa as a hub for digital innovation.
 

Major international players operating and cementing their footprints in South Africa cloud computing market are SAP Africa, IBM South Africa, Microsoft South Africa, HP South Africa, Huawei, AWS, Dimension Data South Africa, T-Systems, Accenture, Software AG, MTN Group, and Brighthouse vPS. Cloud service provides are focused towards offering advanced solutions that can be integrated with existing business application solutions. Further, managed hosting service providers are emphasizing more on entering into partnership with major international brands and to strengthen their cloud portfolio and customer reach.

SOUTH AFRICA CLOUD COMPUTING MARKET COVERAGE

Analysis Period

2019 – 2031

Actual Data

2019 – 2022

Base Year

2022

Estimated Year

2023

CAGR Period

2023 – 2031

Research Scope

Service Model

  • Infrastructure as a Service (IaaS)
  • Platform as a Service (PaaS)
  • Software as a Service (SaaS)

Deployment Model

  • Public Cloud
  • Private Cloud
  • Hybrid Clou

Subscription Model

  • On-Demand Subscription
  • Committed Use Subscription
  • Package Subscription
  • Hybrid Subscription

Enterprise Size

  • Startups & Small Businesses (1-50 employees)
  • Mid-Sized Companies (51-250 employees)
  • Large Enterprises (251+ employees)

End User

  • IT and Telecom
  • Media and Entertainment
  • Energy and Power
  • Transportation and Logistics
  • Healthcare
  • BFSI
  • Retail
  • Manufacturing
  • Government
  • Education
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