IT outsourcing constituted about 40% of the South African IT services market, which represents the largest market share of all IT services foundation markets, followed by systems integration-and-installation and support services.
Suzanne Nolan, a research analyst for IT services at IDC SA, said the sector resurged in 2010 following the global economic turmoil. "After the freeze in IT budgets that came about as a result of the global economic crisis, 2010 saw a rebound in IT services spending." The growth in IT services spending was driven by a recovering economy, increased business confidence, expanding bandwidth availability and various infrastructure investments made in the country in 2010, Nolan said.
As leader of Africa's IT development, South Africa is the 20th largest consumer of IT products and services in the world. The sector is becoming an important contributor to the country's GDP. Nolan told The New Age Online that services, not the usual outsourcing deals, were a key driver to the sector's rejuvenation. "This growth was mainly driven by managed services rather than by traditional information system outsourcing contracts. The healthy growth in outsourcing services signifies a level of sophistication and maturity within the IT services segment," she said.
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