The South African Information Technology Sector: Information Technology (IT) has become an important enabler of economic development and social inclusion, and in the words of the Minister of Telecommunications and Postal Services, “It transforms how we live, how we do business, how we relate to each other and even how we play.” Increasing by 3.8% from 2015, South African IT spend for 2016 is expected to reach R272bn. Although estimates of the IT sector’s contribution to GDP vary between 1% and 6%, most stakeholders agree that delays in the implementation of the National Integrated ICT Policy White Paper and vital projects such as digital migration and SA Connect are restricting the growth of the sector as well as South Africa’s economic growth and social development.
A Rapidly Changing Sector: Within the IT sector the latest trend is the 4th Industrial Revolution which consists of new technologies that will seamlessly connect billions of people and devices, thereby having an impact on all disciplines, economies and industries. These advances in technology have been identified as the top megatrend that will transform the ways in which companies do business over the next five years. The IT industry is characterised by consolidations and convergence of companies within the sector, and between companies in the IT and telecommunications sectors. Analysts believe that in such a competitive and rapidly changing industry, it is critical to maintain a competitive edge through mergers, key acquisitions, joint ventures, partnerships, expansion and disposals.
The South African Information Technology Sector report describes current conditions in the industry which comprises hardware manufacturing, assembly, consulting and supply
software development, consulting and supply
and retail sales of hardware and software. Recent developments including the challenges facing the IT sector and merger and acquisition activity are included in this detailed report. In total 97 companies involved in the sector are profiled, ranging from major players EOH Holdings Ltd and Dimension Data, to small consultancies such as Faranani IT Services (Pty) Ltd and Evetech (Pty) Ltd, a computer system builder and retailer of computer related products.
Table Of Contents
The IT Industry in South Africa 2016 1. INTRODUCTION 1 2. DESCRIPTION OF THE INDUSTRY 1 2.1. Industry Value Chain 3 2.2. Geographic Position 4 3. SIZE OF THE INDUSTRY 5 4. STATE OF THE INDUSTRY 15 4.1. Local 15 4.1.1. Corporate Actions 21 4.1.2. Regulations 29 4.1.3. Enterprise Development and Job Creation 34 4.2. Continental 36 4.3. International 43 5. INFLUENCING FACTORS 49 5.1. Economic Environment 49 5.2. Government and Private Sector Initiatives 51 5.3. ICT Industrialisation and SMME Development 52 5.4. Strong IT Investment in the Education Sector 54 5.5. âSmart Provincesâ and âSmart Citiesâ 55 5.6. Technology, Research and Development (RandD) and Innovation 58 5.7. Labour 60 5.8. Cybercrime 65 5.9. Environmental and Social Issues 67 5.10. Electricity Supply Constraints 69 6. COMPETITION 70 6.1. Barriers to Entry 71 7. SWOT ANALYSIS 72 8. OUTLOOK 73 9. INDUSTRY ASSOCIATIONS 73 10. REFERENCES 75 10.1. Publications 75 10.2. Websites 76 APPENDIX 1 79 PricewaterhouseCoopers Essential Eight Technologies - Description 79 APPENDIX 2 80 International Telecommunications Union: The Connect 2020 Goals and Targets 80 APPENDIX 3 81 SMME Hardware Manufacturers, Hardware Suppliers and e-Waste Refurbishers 81 APPENDIX 4 83 Real-world Salaries of IT Professionals in South Africa 83 COMPANY PROFILES - COMPUTER and RELATED ACTIVITIES 84 ACCENTURE (SOUTH AFRICA) (PTY) LTD 84 ACI GLOBAL LTD 86 ADAPTIT HOLDINGS LTD 88 AFRIHOST (PTY) LTD 91 ALLIED ELECTRONICS CORPORATION LTD 93 ATTACHMATE GROUP SOUTH AFRICA (PTY) LTD 97 BARONE BUDGE AND DOMINICK (PTY) LTD 99 BIDVEST OFFICE (PTY) LTD 101 BLUE LABEL TELECOMS LTD 104 BUSINESS CONNEXION (PTY) LTD 109 CASH CONNECT MANAGEMENT SOLUTIONS (PTY) LTD 114 CASH PAYMASTER SERVICES (PTY) LTD 116 CCI TECHNOLOGY SOLUTIONS (PTY) LTD 118 CHM VUWANI COMPUTER SOLUTIONS (PTY) LTD 120 CISCO SYSTEMS (SOUTH AFRICA) (PTY) LTD 123 DATACENTRIX HOLDINGS LTD 124 DATATEC LTD 128 DELOITTE SOUTH AFRICA 133 DIMENSION DATA (PTY) LTD 137 DIRECT TRANSACT (PTY) LTD 140 DOCU-FILE JHB (PTY) LTD 142 DOCUMENT WAREHOUSE (PTY) LTD (THE) 144 EASYPAY (PTY) LTD 147 ECENTRIC PAYMENT SYSTEMS (PTY) LTD 149 ENTERPRISE ELECTRONIC COMMERCE (SA) (PTY) LTD 151 EOH HOLDINGS LTD 153 ERNST AND YOUNG ADVISORY SERVICES (PTY) LTD 157 FACE TECHNOLOGIES (PTY) LTD 162 FARANANI IT SERVICES (PTY) LTD 164 FLASH MOBILE VENDING (PTY) LTD 166 FUJITSU SERVICES (PTY) LTD 169 GIJIMA GROUP LTD 170 HETZNER (PTY) LTD 174 HEWLETT-PACKARD SOUTH AFRICA (PTY) LTD 176 IBM SOUTH AFRICA (PTY) LTD 178 INTEGR8 IT (PTY) LTD 180 INTEL SOUTH AFRICA CORPORATION 182 IT-DYNAMICS (PTY) LTD 184 ITEC DISTRIBUTION (PTY) LTD 186 KPMG SERVICES (PTY) LTD 188 LIGHTSTONE CONSUMER (PTY) LTD 191 M I B TECHNOLOGY (PTY) LTD 193 MARINE DATA SOLUTIONS (PTY) LTD 195 MCKINSEY AND COMPANY AFRICA (PTY) LTD 197 MEDIKREDIT INTEGRATED HEALTHCARE SOLUTIONS (PTY) LTD 199 METROFILE HOLDINGS LTD 201 MICROSOFT (S A) (PTY) LTD 205 MONDIAL IT SOLUTIONS (PTY) LTD 208 MORVEST GROUP (PTY) LTD 210 MUSTEK LTD 213 OLTIO (PTY) LTD 217 ORACLE CORPORATION (SOUTH AFRICA) (PTY) LTD 219 PARACON SA (PTY) LTD 221 PAYCORP CORPORATE SERVICES (PTY) LTD 223 PAYCORP GROUP (PTY) LTD 225 PINNACLE HOLDINGS LTD 227 PRICEWATERHOUSECOOPERS INC 231 PRISM PAYMENT TECHNOLOGIES (PTY) LTD 241 RICOH SOUTH AFRICA (PTY) LTD 243 SAGE SOUTH AFRICA (PTY) LTD 245 SAS INSTITUTE (PTY) LTD 247 SETCOM (PTY) LTD 249 SIEMENS (PTY) LTD 251 SILKWOOD TRADING 18 (PTY) LTD 254 SOUTH AFRICAN BANKERS SERVICES COMPANY (PTY) LTD 255 SPARK ATM SYSTEMS (PTY) LTD 257 STATE INFORMATION TECHNOLOGY AGENCY SOC LTD 259 STELLAR CAPITAL PARTNERS LTD 263 SYSTEMS APPLICATIONS PRODUCTS (SOUTH AFRICA) (PTY) LTD 266 T-SYSTEMS SOUTH AFRICA (PTY) LTD 268 TRANSACTION CONTROL TECHNOLOGIES (SA) (PTY) LTD 270 TRUSTLINK (PTY) LTD 272 UCS SOLUTIONS (PTY) LTD 274 VERIFONE AFRICA (PTY) LTD 276 VSOLUTION (PTY) LTD 278 WIZZIT PAYMENTS (PTY) LTD 280 COMPANY PROFILES - WHOLESALERS OF LAPTOPS, DESKTOPS AND PERIPHERALS 282 ACER AFRICA (PTY) LTD 282 ASUSTEK COMPUTER INC 284 AXIZ (PTY) LTD 290 DELL COMPUTER (PTY) LTD 292 ESQUIRE SYSTEM TECHNOLOGY (PTY) LTD 294 FUJITSU SERVICES CORE (PTY) LTD 296 HISENSE SA SALES HOLDINGS (PTY) LTD 298 HUAWEI TECHNOLOGIES AFRICA (PTY) LTD 299 INTEL SOUTH AFRICA CORPORATION 301 LENOVO (SOUTH AFRICA) (PTY) LTD 303 LG ELECTRONICS SA (PTY) LTD 305 MICROSOFT (S A) (PTY) LTD 307 MUSTEK LTD 310 SAMSUNG ELECTRONICS SOUTH AFRICA (PTY) LTD 314 TARSUS DISTRIBUTION (PTY) LTD 316 COMPANY PROFILES - RETAILERS OF LAPTOPS, DESKTOPS AND PERIPHERALS 319 CHM VUWANI COMPUTER SOLUTIONS (PTY) LTD 319 EVETECH (PTY) LTD 322 JD GROUP LTD 323 LENOVO (SOUTH AFRICA) (PTY) LTD 329 LG ELECTRONICS SA (PTY) LTD 331 REBEL TECH CC 333 WOOTWARE COMPUTERS CC 334