The overall software market will slow in the next few years, because of anticipated flat performance in the Europe, Middle East and Africa region, says research firm IDC.
Based on research on more than 1 000 software vendors in 49 countries, the research house says last year saw nearly double-digit growth in the worldwide software market, the highest annual growth rate in the years since the 2008 financial crisis.
Patrick Melgarejo, director of worldwide software trackers at IDC, says the overall software market will return to more conservative growth in the years to come.
Mogen Naidoo, senior research analyst in IDC's sub-Saharan African software, security and enterprise solutions unit, says SA's growth will also slow, but only marginally as the economy is on a growth path.
However, Naidoo cautions that, as long as the debt crisis in Europe looms over the global economy, the public sector and enterprises will remain cautious about spending. He points out that 2012 has seen a return to confidence from businesses, consumers and investors due to infrastructure improvements and more efficient decision-making in the private sector.
Total spending on IT in SA reached nearly $12.75 billion in 2011 and is expected to grow at a compound annual growth rate of 6.2%, to $16.07 billion, in 2016, says Naidoo. Over the same time, software will grow at a compound annual growth rate of 10.8%, to reach $3.3 billion in 2016, from $1.96 billion last year, he notes.
Naidoo says a recovery in the Eurozone could lead to an upward revision in the forecast growth for SA's software market, as direct and indirect ties with large countries in the Eurozone will have an impact in SA and around the globe.
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