Report Overview

An increasing demand for data storage and processing and rising number of fiber and wireless connectivity services roll outs are expected to boost the growth of South Africa Cloud Computing Market during the forecast period between 2023 and 2029.

South Africa Cloud Computing Market - Industry Trends & Forecast Report, 2029

South Africa Cloud Computing Market size was estimated to be worth USD 3.12 billion in 2022. During the forecast period between 2023 and 2029, the South Africa Cloud Computing Market size is projected to grow at a CAGR of 24.4%, reaching a value of USD 11.56 billion by 2029. Major growth factors for the South Africa Cloud Computing Market include the rising adoption of advanced technologies such as artificial intelligence (AI), the Internet of Things (IoT), and machine learning (ML), along with expanding demand for data storage and processing across various sectors.

Cloud Computing – Overview

Cloud computing is a technology that enables real-time and on-demand access to computer services, such as data storage and processing power, without requiring direct management. Using cloud computing is cost-effective for organizations as they only pay for the cloud services they want, instead of spending on entire IT infrastructure and operating costs. Cloud computing also offers better productivity as it eliminates the need for assembling, racking, and stacking IT components. Cloud computing is entering the maturity stage, with increasingly more companies embracing a cloud-first strategy.

South Africa Cloud Computing Market

Growth Drivers

Rising Private Investments in Cloud Infrastructure

South Africa is emerging as a lucrative market for cloud computing owing to the rising demand for cloud services in the country. As a result, various tech giants, including Amazon, Google, and Microsoft, are investing in cloud infrastructure as well as human resource development to enhance cloud computing skills. For instance, Google recently launched a cloud region in South Africa and is also investing in building Dedicated Cloud Interconnected Sites. Amazon Web Services also opened its first international AWS Skills Center in Cape Town, South Africa, to provide access to cloud skills training. Such investments by these tech giants are anticipated to present significant growth opportunities for the South Africa Cloud Computing Market.

Restraints

High Risk of Data Theft and Security Breaches

While cloud computing allows for more efficient operations, it may also result in firms paying excessive fees, losing confidential information, and spending a significant amount of time dealing with cloud footprints. The deployment of cloud computing also means the adoption of security solutions and services to prevent the risks of cyberattacks. Inadequate cloud security measures result in data leakage over cloud networks, which can lead to intellectual property theft, contract violations, and malware assaults. Hackers can also hinder how businesses deliver services to their clients or end users. The lack of sufficient cybersecurity infrastructure in South Africa may limit the adoption of cloud computing in the region.

Impact of Escalating Geopolitical Tensions on South Africa Cloud Computing Market

The escalating geopolitical tension is hindering the growth of the South Africa cloud computing market. For instance, the Israel-Hamas conflict is directly influencing the adoption and implementation of cloud computing in the South Africa market. The adoption of cloud computing involves hardware such as sensors and servers. Israel is a leading chip producer outside of East Asia as well as a research hub for advanced technologies. The ongoing Israel-Hamas conflict has had an adverse effect on semiconductor chip manufacture and supply. Due to the disastrous scenario and a lack of financial resources as well as staff to undertake the operations, R&D efforts were entirely suspended with the onset of war between the two countries.

South Africa Cloud Computing Market

Segmental Coverage

South Africa Cloud Computing Market – By Service

Based on service, the South Africa Cloud Computing Market is segmented into Infrastructure as a Service (IaaS), Platform as a Service (PaaS), and Software as a Service (SaaS). The SaaS segment accounts for the highest market share in the South Africa Cloud Computing Market by service, because of its faster deployment and minimal maintenance expenses. Organizations may pay based on their demands and data volume without the need to build a physical infrastructure. As a result, most major firms, such as Google and Amazon, concentrate on SaaS solutions, which fuels the growth of SaaS segment in South Africa Cloud Computing Market.

South Africa Cloud Computing Market – By Deployment Model

Based on deployment model, the South Africa Cloud Computing Market is segmented into public, private, and hybrid. The private cloud segment holds the largest share in the South Africa Cloud Computing Market owing to its strong demand among large enterprises. Due to limited access, only designated users can access data in private deployment, giving users more control over their data and the ability to supply resources as needed. Large enterprises leverage private deployment because of its elasticity, scalability, and ease of service delivery, which contributes to its market’s growth.

South Africa Cloud Computing Market – By Enterprise Size

Based on enterprise size, the South Africa Cloud Computing Market is segmented into large enterprises and small and medium-sized enterprises (SMEs). The large enterprises segment accounts for a higher share of the market by enterprise size. The growth of the segment is mainly attributed to the expanding remote working culture. Large enterprises may use cloud computing to automate mundane processes and finish them more quickly. Large corporations are projected to use this technology to streamline procedures, which is anticipated to fuel the growth of the Cloud Computing Market in South Africa.

South Africa Cloud Computing Market – By End User

Based on end user, the South Africa Cloud Computing Market is segmented into BFSI, telecom & IT, media & entertainment, energy & utilities, manufacturing, e-commerce, government & public sector, healthcare, and others. The BFSI sector dominates the South Africa Cloud Computing Market owing to the rapid growth in online banking activities. Cloud computing in banking allows faster transactions, real-time account updates, fraud detection, and prevention, as well as faster data processing and analysis. The manufacturing sector, on the other hand, is anticipated to register a significant growth rate in the South Africa Cloud Computing Market by end user during the forecast period.

Competitive Landscape

Major players operating in the South Africa Cloud Computing SAP Africa, IBM, Microsoft, HP, Dimension Data, T-Systems, Accenture, MTN Group, Amazon Web Services, and Wipro. To further enhance their market share, these companies employ various strategies, including mergers and acquisitions, partnerships, joint ventures, license agreements, and new product launches.

Recent Developments

• In October 2023 – BCX, an information and communication technology company based in South Africa, launched an Africa Local Public (ALP) cloud service, using Alibaba Cloud to offer digital solutions across Africa.

Scope of the Report

By Service

• Infrastructure as a Service (IaaS)

• Platform as a Service (PaaS)

• Software as a Service (SaaS)

By Deployment Model

• Public

• Private

• Hybrid

By Enterprise Size

• Large Enterprises

• Small & Medium-sized Enterprises (SMEs)

By End User

• BFSI

• Telecom & IT

• Media & Entertainment

• Energy & Utilities

• Manufacturing

• E-Commerce

• Government & Public Sector

• Healthcare

• Others