- Overall enterprise IT spending in 2020 is expected to fall between 3% and 5% in the GCC; the biggest impact is in Saudi Arabia (4.3%) and the UAE (4%).
- GCC public cloud market is expected to grow from $956m this year to $2.35b in 2024.
- IaaS is expected to grow by about 33% and SaaS by 24% this year.
Dubai: The pandemic has impacted IT markets across the Gulf Cooperation Council (GCC) countries but there is positive momentum in cloud adoption, an industry expert said.
Jyoti Lalchandani, Group Vice-President and Regional Managing Director for the Middle East, Turkey and Africa at research firm International Data Corporation (IDC), said that work from home and disaster recovery are putting a new onus on cloud spending.
“Enterprise IT spending is expected to fall between three per cent and five per cent in the GCC, varying across the countries but the biggest impact is in Saudi Arabia (4.3 per cent) and the UAE (4 per cent), the biggest markets in the region,” he said.
GCC public cloud market (IaaS, SaaS and PaaS) is expected to grow from $956 million this year to $2.35 billion in 2024, at an annual growth rate of 25 per cent.
Only the positive trend, he said is the IaaS and SaaS segments.
“IaaS is expected to grow by about 33 per cent and SaaS by 24 per cent this year. In the long run, IaaS and PaaS are going to grow at a much faster pace,” he said.
However, he said that cloud adoption is the new platform for most of the enterprises for cost reduction, agility, efficiency and innovation.
Hyperscalers continue to open and announce new availability zones in the region due to strong demand.
IDC predicts that the contribution of “digital coworkers” will increase by 35 per cent by 2021 as more tasks are automated and augmented by technology.
By 2024, enterprises with intelligent and collaborative work environments will see 30% lower staff turnover, 30 per cent higher productivity, and 30 per cent higher revenue per employee than their peers.
Major shift in CIO re-prioritisation
There has been a significant shift in CIOs’ priorities, he said and added that the short- to medium-term priorities are changing.
“We are seeing a three major shift in CIO re-prioritisation – cloud shift and infrastructure modernisation, distributed architecture and digital trust, and app modernisation and automation,” Lalchandani said.
As per IDC’s survey, 53 per cent of CIOs are accelerating their existing digital transformation efforts, even more, to meet new customer and operational agility needs while 48 per cent of organisations are expected to continue with digital transformation initiatives as planned at the start of the year.
“We see a lot of apps and services moving to the cloud as organisations speed up digital transformation journey in the region,” he said.
Investments by CIOs in the next 12-18 months, he said will focus on team collaboration applications, unified video communications and conferencing systems and digital workplaces.
Many organisations are increasing their investments in automation and robotic workers to reduce operational costs and improve efficiency, he added.
“The current crisis will accelerate workforce transformation as more non-human workers are expected into the workforce as the economy expands, building dynamic and hybrid workforce in the future. Hybrid cloud is emerging as the model for many CIOs and head of IT across the region,” he said.
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