IDC Predicts Saudi ICT Market to Bounce Back in 2017 to $33.8 Billion

Saudi ICT market will rebound in 2017 to reach a value of $33.8 billion for the year, according to the latest insights presented by IDC. Hosting its annual 'IDC Predictions 2017' event at The Ritz-Carlton, Riyadh, the global technology research and consulting services firm said it expects Saudi Arabia's ICT market to grow 2.4% year on year in 2017, which represents a considerable improvement on the -5.1% downturn experienced in 2016.

"Last year was certainly a challenging one for vendors, services providers, channel partners, and end users alike," says Hamad AlSaghir, IDC's country manager for Saudi Arabia. "The year was characterized by weak oil prices and increasing inflation, resulting in lower-than-usual spending by the government, which has traditionally been the leading spender on technology and associated services. In order to counter the negative impacts of economic dependence on oil, the Saudi government has initiated its Vision 2030 initiative, of which the National Transformation Program (NTP) forms an integral part.

"The NTP's influence on the kingdom's ICT market will be far reaching in 2017," says Hamza Naqshbandi, principal analyst at IDC Saudi Arabia. "For example, we expect to see a considerable evolution of the cloud marketplace as NTP-related initiatives gather momentum and make use of cloud-based services to achieve the stipulated objectives of the program. We are also anticipating increased investment in the areas of big data and advanced analytics, a trend that will contribute considerably towards improving the provision of citizen-centric services in line with the goals of the NTP.

As organizations across Saudi Arabia embrace this evolving ICT landscape and address the challenge of having to do more with less, the shift towards software and IT services is gathering considerable momentum. Indeed, IDC expects spending on software and IT services to see year-on-year growth of 5.5% and 9.9%, respectively, in 2017. This is significantly faster than the anticipated growth across the market's hardware and communications segments, where IDC forecasts spending to increase at a much more modest 0.6% and 1.7%, respectively.