SA, Kenya cloud revenues to more than double by 2018

The combined revenues of the cloud computing markets in South Africa and Kenya will more than double to US$288 million in 2018 from US$114.6 million in 2013, due to rapidly expanding bandwidth capacity following the landing of undersea cables.

A report by Frost & Sullivan, entitled “Overall Cloud Computing Market in South Africa and Kenya”, said the increased bandwidth available in the two countries has led to the proliferation of data centres and established a platform for the development of cloud computing services.

Frost & Sullivan said South African and Kenyan enterprises are embracing outsourcing and managed services for various business and technological benefits, further driving this migration to cloud computing, with the firm predicting Software as a Service (SaaS) will become the most popular cloud computing platform.

“Despite widespread awareness and the fact that cloud has been around for a couple of years in Kenya and South Africa, enterprises have understood and embraced cloud computing to varying degrees,” the company said. “By and large, actual adoption of these services continues to be dependent on sector, and more pertinently, on enterprise size.”

“While private cloud services have been the main focus of tier I competitors in the large enterprise sector, the move towards public cloud is slowly gathering pace in both countries,” said Frost & Sullivan information and communication technologies research analyst Lehlohonolo Mokenela. “Small and medium enterprises, in particular, are turning to cloud computing motivated by the availability of affordable and convenient public cloud offerings.”

The report said, however, that security concerns and lack of trust in third parties are dissuading some enterprises and governments from employing data centre services, a view which is especially prevalent in the financial services and healthcare sectors, where security and compliance are critical.

Insurance companies and banks, however, are beginning to move their less critical applications to the cloud in order to reduce costs.

“Non-core applications, such as email and customer relationship management, will be the most commonly migrated solutions as organisations look to test the reliability of cloud services,” said Mokenela.

“It will be crucial for service providers to demonstrate the security of their solutions in order to allay consumer concerns and boost uptake in the South African and Kenyan cloud computing domain.”

source: BizTech Africa