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New business models drive ICT in Africa

IT is seeing healthy growth across Africa, and technologies like mobile, cloud, big data and social media are driving new business models and added value across the continent.

This is according to IDC, which yesterday released its predictions for Africa in 2015.

Currently, IT in South Africa is experiencing 6,5% compound annual growth rates (CAGR), with Kenya on 9,5%, Nigeria on 10.3% and the rest of Africa on 16,4%.

The overall ICT market, with telecommunications factored in is: South Africa at 3,8%, Kenya at 4,3%, Nigeria at 4,9% and rest of Africa at 8,4%.

Mobile subscriptions are booming, with a market penetration of 154% in South Africa, 84% in sub-Saharan Africa, 75,2% in Kenya, 78,3% in Nigeria and 80% in Africa overall.

IDC makes the following 10 predictions for the continent in 2015:
ICT investments addressing African market realities will also fuel GDP growth in key African countries.
ICT growth will be a strong driver of GDP growth in key countries such as Kenya, Nigeria, and Rwanda, with mobile services penetration, financial inclusiveness initiatives and government service delivery driving ICT spend in the telecommunications, financial services, and government verticals.

Governments with relevant, effective national ICT policies will begin to dominate the economic landscape.
Increased government policies and relevant processes that favour ICT activities in the society will have a significant impact in countries such as Nigeria, Kenya, Rwanda, and Egypt where policies increase ICT awareness and access device penetration, improve service platforms and boost 2015 infrastructure developments.

2015 heralds the battle for the SME market in more developed African markets.
While a variety of ICT providers have made concerted efforts to tap into the SME market in recent years, 2015 heralds the open battle for the SME market, where telcos will be strongly positioned to leverage their existing relationships with this segment.

Security concerns will remain as mobile devices, data and access methods increase.
Africa’s 2015 trade is firmly entrenched within the context of the global economy, and governments will slowly but surely address cyber security legislation and education, and consider further country-specific data protection that will require in-country presence for multinational ICT providers.

External socio-economic agendas will boost ICT usage, but will face strong resistance without due localisation.
International entities such as World Bank WHO, USAID, and the UN want a better understanding of market dynamics, competitiveness, and productivity in countries that they invest in, and their investments will continue to influence guidelines for ICT solutions and use, as will MNCs considering FDI, BRICS trade, and increasing South/South trade.

2015 heralds the next level of African IT procurement – new clients, new products, new markets.
The African market is characterized by new markets, products, and clients, sought after by MNCs and African organisations alike driving innovation and entrepreneurship through cloud, the social enterprise, enterprise mobility, and big data as new product sets.

Technology will help breach intra-Africa trade barriers by removing obstacles, increasing efficiency and encouraging transparency.
IDC anticipates that 2015 will see closer intra-Africa trade facilitated by ICT initiatives such as payment systems, financial inclusion initiatives, and cross-border payments.

Digital engagement that encompasses integration of mobility benefits with those offered by cloud, big data and social networking will be the key to capturing market share in Africa.
Digital engagement will combine social, mobility, and big data initiatives, enabled by a cloud-based approach, and move Africa’s mobility momentum into the value-add space.

Bifurcation will characterise mobility initiatives as smartphones outpace feature phones.
African smartphone adoption will continue to be a high growth area in 2015, but feature phones, far from dead, will stimulate development that will centre around capturing the feature phone long tail by improving the customer experience.

New cloud model emerging; 2015 is the year when the technology discussion falls away, in favour of the business discussion.
2015 is the year is where cloud computing proves its worth, and not just as old wine in new skin, but rather as a business driver, where Nigeria and Kenya will catch up to more mature markets as the time to market cycles in these regions diminish exponentially.

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