New opportunities in the ICT market?

February 8, 2024

IDC predicts that annual spending on ICT in the Middle East, Türkiye, and Africa will top $238 billion (€221 billion) in 2024.

Overall spending on information and communications technology (ICT) across the Middle East, Türkiye, and Africa (META) will top $238 billion (€221 billion) this year, an increase of 4.5% over 2023. That is according to the latest predictions presented last week by International Data Corporation (IDC) as more than 400 senior executives from the region’s most influential technology vendors, telecommunications operators, and IT service providers gathered at The Ritz-Carlton, Dubai International Financial Centre on 1 February for the 2024 edition of IDC Directions Middle East, Türkiye, and Africa.

Announcing its regional forecasts for the year ahead, IDC revealed that it expects telecommunications services spending to increase 5% year on year (YoY) in 2024 to reach $133 billion (€124 billion), with IT spending set to grow 3.9% YoY to $105 billion (€97.61 billion). As META’s digital economy increasingly takes shape, IDC forecasts that digital transformation spending in the region will top $59 billion (€55 billion) in 2024 and accelerate at a compound annual growth rate (CAGR) of 15% over the coming years to cross the $88 billion (€82 billion) mark in 2027.

This year’s IDC Directions Middle East, Türkiye, and Africa focused on the theme ‘Preparing Your Customers for an AI Everywhere Future’, with IDC predicting that spending on AI in the region will top $3.0 billion (€2.79 billion) this year, up 32% on 2023. Hosting a panel discussion alongside Srinivasan Sampath, acting group CTO at First Abu Dhabi Bank, Vinay Ramesh Kumar, CTO at Landmark Group, and Ahmed AlZarooni, Vice President of IT at a leading government entity, IDC’s Group Vice President and Managing Director for the META region, Jyoti Lalchandani, explained that the AI investment priorities of end-user organisations will likely evolve over the coming years as they move beyond their initial focus on reducing costs.

“Across the META region, there is a clear appetite for AI in general and generative AI (GenAI) in particular, with spending on AI forecast to reach $6.9 billion (€6.42 billion) by 2027,” revealed Lalchandani. “However, many organisations are already questioning whether they are over-pivoting on cost reduction and not focusing enough on how AI can help them to grow their revenues. We expect revenue growth outcomes to take center stage in the next 3–5 years and providers must track this shift carefully with their core buyers to ensure that their AI-related offerings continue to align with the evolving business goals of their customers.”

IDC’s Global President, Crawford Del Prete, presented the event’s keynote address, ‘The AI Moment: Welcome to the Next Era of Technology’, during which he heralded GenAI’s emergence as a golden era of innovation. “The impact of GenAI’s emergence will reshape the IT landscape as companies strive to not only boost productivity, but also create new ways of meeting the needs of customers,” said Del Prete. “We are increasingly seeing companies invest aggressively in GenAI to capture an advantage and ensure they are not left behind. Indeed, by 2027, we expect global spending on GenAI to top $150 billion (€139.52 billion), accounting for around 30% of all AI-related investments.”

This was followed by a session titled ‘Preparing Your Customers for an AI Everywhere Digital Future’, during which Thomas Meyer, IDC’s Group Vice President of research for the EMEA region, explained the support mechanisms that tech vendors must put in place for their customers. “As GenAI adoption grows in the META region, tech providers must develop a responsible AI strategy,” said Meyer. “As part of this strategy, they need to support their customers in unlocking funding for investments and delivering ROI and significant business outcomes for prioritised use cases.”

Other notable predictions revealed at IDC Directions Middle East, Türkiye, and Africa included the following:

• Spending on public cloud in the META region will top $13 billion in 2024, representing year-on-year growth of 21%.
• Software as a service (SaaS) will account 59% of this public cloud spending, followed by infrastructure as a service (IaaS) at 23% and platform as a service (PaaS) at 18%.
• Cybersecurity spending has surpassed previous growth projections and is forecast to cross the $6.5 billion (€6.04 billion) mark in 2024.
• 77% of CISOs in the META region expect their cybersecurity budgets to increase by 10% or more in 2024.

IDC Directions Middle East, Türkiye, and Africa takes place annually and is a firm fixture on the ICT industry calendar, providing a platform for exchanging ideas and engaging with IDC’s most prominent local and global analysts.

Categories : World Focus

Tags : Africa ICT IDC Market Insight Middle East Predictions Research