IT spending in the Middle East and Africa (MEA) is set to reach USD 83.7 billion in 2020, up 2.8 percent year-on-year. Enterprises will account for close to 56.8 percent of this figure. Sector such as telecommunications, finance, government, and manufacturing will continue to be the biggest spenders. However, it is the transportation sector that will see the fastest growth over the coming years, followed by utilities and retail & wholesale.
These are some of the highlights from IDC that has also included data from its IDC Black Book, Q1 2019 in these figures.
With digital transformation (DX) increasingly shaping the investment decisions of organizations across the region, consumer and enterprise mobility will account for the largest chunk of spending in 2020 at USD 40.0 billion, followed by the Internet of Things at USD 9.1 billion.
The quest for DX will drive investments in other emerging technologies too, with cloud ($2.7 billion), big data & analytics ($2.7 billion), and security ($2.9 billion) expected to be key areas of investment in 2020.
“The focus of investment in areas such as mobility, IoT, cloud, and big data underlines the critical need to explore and adopt digital technologies in order to transform government practices, business models, and society in general,” said Jyoti Lalchandani, IDC’s Group Vice President and Regional Managing Director for the Middle East, Africa, and Turkey.
She added, “Indeed, digital transformation success is now so intimately tied to the creation of new, ecosystem-driven digital business models that any organization that fails to embrace this wave of digital transformation is placing its own competitive future at risk.”
The growing interest in artificial intelligence across the region is certainly undeniable, with a recent update to IDC’s Worldwide Artificial Intelligence Systems Spending Guide showing that investment in AI systems in MEA is expected to reach USD 374.2 million in 2020, up more than 20 percent on the projected total for this year of USD 310.3 million. This spending will be led by the banking and retail industries, followed by federal/central governments and the telecommunications sector.
“Organizations are continuing to invest significantly in AI software and platforms as they look to optimize their business processes, automate their operations, and enhance their offerings in order to maximize the overall customer experience,” commented Manish Ranjan, IDC’s Program Manager for Software & Cloud in the Middle East, Africa, and Turkey.
He explained that investments in AI systems across MEA will continue to be driven by a wide range of use cases, although the three largest – automated customer service agents, IT automation, and automated threat intelligence and prevention systems – will account for around 30 percent of total AI spending in 2020.