The IT Industry in South Africa

Simplicity is the ultimate sophistication (Leonardo DaVinci)

Digging into the detail and sophistication behind many industry types, one will find surprising complexity, but surely the broad IT industry is in the top ranking. The overview in the WOW report on “The IT Industry in South Africa – April 2022” gives a hint of the size and complexity of the IT industry – making the sub-title appropriate. The exciting part is that technological advancements and the prevalence of IT make this sector a winning horse to bet on for the country’s future development.

The WoW report on the IT Industry in South Africa provides some good news regarding the performance of the industry and the latest developments that position the country competitively amongst its peers in Africa. A refreshing read indeed.

The digital services sector has grown to be the 3^rd largest contributor to GDP by 2020 with 6.51% and is expected to increase that share by 2025, only 3 years away, to 7.86%, good for $31 billion or ZAR 465 billion. It doesn’t stop there as by 2050 the share is expected to increase further to 12.92%!

Today, newer technologies such as 5G is becoming a core part of how companies do business and South Africa is at the forefront of this development as it is amongst the first African countries to roll out its infrastructure. In fields like customer service – customer experience will be enhanced, quality of voice calls improved whilst video support will be more accessible through greater bandwidth, increasing the adoption of Artificial Intelligence machine learning.

Construction companies are now able to track projects and material delivery through the insertion of microchips, water and electricity sector has also undergone major shifts in characteristics and application – today, consumers can purchase these essential services online and utility providers can allow them upfront through pre-paid applications. The concept of the Internet of things (IoT) is now pervasive in all things we interact with; its application is unsuspectedly wide, not always visibly or noticeably utilized.

The 5G technology roll-out in South Africa will be further bolstered by the overdue release of the high demand spectrum announced by the Minister of Communications, Ms Ntshavheni earlier this year. This will greatly enhance the ability of mobile telecommunications operators to build robust telecommunications networks with better penetration. In her announcement, she said, “in the immediate, ICASA has imposed social obligations that will see the telecommunications operators connecting 18520 schools, 5 731 clinics and hospitals, 8 241 traditional authority offices, 949 libraries and Thusong Service Centers over the next 36months.”

With more people and businesses going online security breaches and privacy infringements have become more frequent with regular data hacks on institutions and companies holding vast amounts of personal information. The intention of the hacks is sometimes for selling it on the dark web or merely for marketing purposes or sometimes for more dubious and underhanded transactions. The purchasers of such information, illegally and fraudulently, use that information to rob and/or blackmail people. The abuse has become so frequent, that it triggered a raft of laws and regulations to protect personal and private information.

A good example of this type of cybercrime is the recent hacking of TransUnion South Africa. Millions of people’s private and sensitive data are now in the hands of people with less honest intentions as to what they are planning with that information.

Despite the challenges inherent in new technologies, the benefits of development and progress in all things IT far outweigh the drawbacks drawback and dangers. This has led to the growth of the cybersecurity industry which has also become more complex and sophisticated. The use has truly become essential and all users have to remain alert and realise that the use of IT is not without risks.

Banking transactions can no longer be done without the use of IT. Retail payments are almost always done using IT, and banks now insist that customers withdraw money from ATMs and enforce this by charging exorbitant fees for withdrawing inside the bank. This is only possible because of the IT operating in the back-end.

IT is so diversified that it offers immense opportunities with very low barriers to entry for SMMEs and entrepreneurs for the development of new apps, consultancies on applications, new hardware devices and so on. This is also in line with the UN development goals which state that economies with consistently high levels of innovation also tend to have high levels of growth.