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Middle East and North Africa public cloud spend to hit $2bn by 2020

Middle East-based organisations are turning to public cloud services, with software as a service driving a major year-on-year spending increase

Organisations in the Middle East and North Africa (Mena) are set to spend a total of $1.2bn on public cloud services this year, according to Gartner, and the IT analyst firm expects spending to reach almost $2bn by 2020.

This year’s 22% increase on last year’s $956m spend was fuelled by demand for platform as a service (PaaS), which is expected to increase by 28.8%, and software as a service (SaaS), which Gartner tipped to rise by 28.5%. SaaS is the biggest slice of cloud spend, with $307m expected to be spent across the Mena region in 2017. SaaS spending in the region is expected to reach $620m in 2020.

“The growth in PaaS and SaaS are indicators that migration of applications and workloads from on-premise datacentres to the cloud, as well as development of cloud-ready and cloud-native applications, are fuelling growth in the cloud space,” said Sid Nag, research director at Gartner. “Software suppliers will continue to shift investments from on-premise licence-based software to cloud-based offerings.”

The cloud in general is on the up in the Middle East. According to Computer Weekly/TechTarget’s IT Priorities 2017 research, 43% of Middle East IT decision makers expect to have bigger budgets for cloud services at their disposal this year than they had last year.  The survey found that 35% are planning an SaaS initiative this year, while 23% will undertake PaaS projects.

Companies in the region are investing in their IT infrastructures to make use of new digital technologies, and suppliers are reacting to increasing demand. For example, businesses in the Middle East can now source cloud services from Alibaba Cloud locally, as the company’s first datacentre in the region gets up and running.

Read more about cloud computing in the Middle East

  • CIOs in the Middle East are formulating their virtualisation strategies as the region warms to the benefits of cloud computing.
  • Demand for traditional IT hardware slumps, as sales of private and public cloud-enabling technologies soar, IDC data shows.
  • Bahraini airline Gulf Air is looking to make productivity gains across its enterprise resource planning system.

There has previously been resistance in the Middle East to cloud adoption because of a lack of confidence in the business model and a lack of clarity on its benefits. However, greater awareness has since seen organisations of all sizes embrace private and public cloud services according to their individual business requirements. For example, last year Gulf Air unveiled plans to expand its hybrid cloud to the Oracle public cloud.

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