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Saudi Arabia Information Technology Report Q1 2016

  • January 2016
  • -
  • Business Monitor International
  • -
  • 71 pages

BMI View: The steep decline in the oil price in 2014 and 2015 has put Saudi Arabia's economy on a lower growth trajectory and as a result we have downgraded our IT market outlook in the Q116 update. We now forecast total spending will grow at a CAGR of 1.8% over 2015-2019 to reach SAR42.8bn in 2019. The hardware segment is forecast to underperform over the medium term as a combination of economic uncertainty and market maturity sees spending contract, though volume growth is expected to return in the final years of the forecast. The services market is the bright spot in our outlook, with cost efficiency and flexibility generating solutions expected to see the strongest demand from local enterprises looking for manoeuvrability in an uncertain economic environment.

This is even true for the oil and gas segment, where low prices could actually prove a catalyst for a new generation of investment in smart services to increase efficiency and ensure margin maintenance in a depressed global market.

Latest Updates & Industry Developments

-Computer Hardware Sales: SAR18.3bn in 2016 to SAR18.1bn in 2019. A weak economic backdrop will combine with market maturity and a dynamic of price erosion to see the hardware segment underperform over the medium term.

-Software Sales: SAR8.6bn in 2016 to SAR10.0bn in 2019. While projects face being deferred or scaled back in the oil sector, enterprise software adoption will continue to deepen among small- and mediumsized enterprises.

-IT Services Sales: SAR11.9bn in 2016 to SAR14.6bn in 2019. Solutions offering cost savings and flexibility to enterprises in an uncertain environment such as outsourcing, cloud computing and smart services expected to underpin outperformance.

Table Of Contents

Saudi Arabia Information Technology Report Q1 2016
BMI Industry View 7
Latest Updates and Industry Developments 7
SWOT 9
IT SWOT 9
Industry Forecast 11
Latest Updates 11
Structural Trends 11
Table: IT Industry - Historical Data And Forecasts (Saudi Arabia 2012-2019) 17
Industry Risk Reward Index 18
Middle East And Africa Risk/Reward Index 18
Table: MEA IT Risk/Reward Index - Q116 21
Market Overview 22
Recent Developments 22
Hardware 22
Software 30
Cloud Computing 36
Services 41
Industry Trends And Developments 48
Regulatory Development 53
Table: IT Regulatory Authorities 53
Competitive Landscape 56
Local Companies 56
Table: Arabic Computer Systems (ACS) 56
Table: Hasoub 56
Table: Saudi Business Machines (SBM) 57
Table: STC Advanced Solutions (formerly AWAL IT Services) 58
Regional Overview 59
Middle East And Africa 59
Demographic Forecast 62
Demographic Outlook 62
Table: Population Headline Indicators (Saudi Arabia 1990-2025) 63
Table: Key Population Ratios (Saudi Arabia 1990-2025) 63
Table: Urban/Rural Population and Life Expectancy (Saudi Arabia 1990-2025) 64
Table: Population By Age Group (Saudi Arabia 1990-2025) 64
Table: Population By Age Group % (Saudi Arabia 1990-2025) 65
Methodology 67
Industry Forecast Methodology 67
Sources 69
Risk/Reward Index Methodology 69
Table: IT Risk/Reward Index Indicators 70
Table: Weighting Of Components 71

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