IT trends in the Saudi Arabian market

Saudi Arabia remains the most lucrative market in the Middle East says Lindsey McDonald

Tags: Frost & Sullivan (www.frost.com)Saudi Arabia
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By  Lindsey McDonald Published  February 20, 2011

Saudi Arabia has long been seen as the most lucrative market in the Middle East, and that is not about to change, according to Lindsey McDonald, Consultant with Frost & Sullivan’s MENA region Information & Communications Technologies Practice.

The Kingdom of Saudi Arabia (KSA) market is recognised as having arguably the biggest potential revenues in the Middle East ICT market, due to the sheer size of the country.

Despite this fact, there is often a sense of uncertainty that surrounds the prospects to create a sustainable business in the market.

One of the reasons for this is that KSA is still a relatively closed market with major vendors only recently having established their presence in the country. The last two to three years brought a surge of activity in the market due to a combination of factors such as the government’s identification of IT as a major area of emphasis for development moving forward and the economic recession meant that when other markets suffered in the region, KSA was thought to be a bastion of growth. Eventually, the market also showed a slowing growth trend, but it was not as adversely impacted as other countries in the region.

Big spenders

The public sector is a major client for IT spending at the moment and particularly in the areas of healthcare and e-government. There is a palpable shift in focus to increase automation and bring the country in line with international standards. The education sector is also providing a host of opportunities for IT vendors and this is from orders as simple as desktops all the way through to high-end laboratory installations.

All of this activity means that there is not only increased spending, but also an increased awareness about the potential for IT solutions. While the early adopters such as the banking sector have already provided impetus to enterprise IT spending, this is now spreading to areas such as the hospitality sector, telecoms, and to an increased extent the energy and industrial markets.

The main drive here is the realisation that well placed investments in IT can be an effective means of bringing down operational costs.

Growth areas

The next growth areas in the Saudi market are likely to come from the greater adoption of managed services and certainly there is already evidence of a high level of interest in services such as cloud computing.

The provision of security services in particular has received a great deal of focus as both private and public sector organisations seek to protect the integrity and security of their data and information assets.

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