Owing to the decline in oil prices and slower economic growth across several countries in the Middle East, the research firm International Data Corporation (IDC) has revised its estimation on information and communications technology (ICT) spending of Middle East for the year 2016.
The firm initially predicted the ICT spending growth to be around five percent, as a number of projects are expected to be delayed in terms of overall ICT investments and weaker consumer sentiment. However, the firm now forecasts the spending to grow by 2.17 percent to reach $103.6 from $101.4 billion in the previous year. This spending will be mainly driven by packaged software and IT services.
Jyoti Lalchandani, group vice-president & regional managing director – for the Middle East, Africa, and Turkey, IDC provided an insight into the challenges faced by the organizations as a result of the current digital transformation.
“The Middle East is increasingly being exposed to a new wave of disruptive technologies that present incredible opportunities to drive innovation and value creation across all facets of the organization,” Lalchandani said.
He believes in adopting to the changing environment and also in delivering the best customer experience. For this to happen, he calls for a new level of enterprise collaborations. The enterprises are reprioritizing their investments, according to IDC. Third platform technologies such as cloud, mobile, social and big data and analytics will rule when it comes to investments.
The regional IT spending, excluding telecom services, is forecasted to grow by 3.1 percent to $44.3 billion this year from $42.9 billion last year. By 2018, at least, half of IT spending will be cloud-based, reaching 60 percent of all IT infrastructure and 60-70 percent of all software services, and technology spending by 2020.
IDC predicts IT as the fastest growing sector with an annual growth rate of 12-15 percent. “More than 50 percent of mobile devices will be accessed biometrically. Cost optimization and lack of skills will drive demand for security services too,” he said.