Home Opinions & Editorials Why the least untapped market is the next big thing in cloud

Why the least untapped market is the next big thing in cloud

-

Microsoft’s Azure Africa services went live in March this year, with services offered from data centers in Johannesburg and Cape Town. March’s first week held many cloud announcements for Africa. The same week Huawei announced that its African cloud region is operational from South Africa. The biggest cloud giant Amazon Web Services (AWS) announced the first availability zone in Africa to be fully operational in the first half of 2020.

Africa is the least untapped market when it comes to the cloud. If it is, then why suddenly Africa comes into the conversation? The reasons are recent developments to set-up fully functional data centers.

Challenges for African Cloud Market

“Less than 1% of the estimated global public cloud services revenue was generated in Africa as of 2018. For indicative purposes, revenue from public cloud services is still lower than mobile operators generate on SMS.” according to “The Rise of the African Cloud” report by Xalam Analytics. To invest in Africa holds its challenges, which continually keeps cloud adoption rates very low across the entire continent. Cloud users in Africa had to connect to servers in Ireland, the United Kingdon, or France. The faraway data centers bring latency or data sovereignty as prominent issues.

As compared to the global levels, the public cloud market in Africa is still pretty small.

Africa has been the trickiest place to provide cloud services with efficiency due to the contribution of different factors. The ground reality is that many countries in the Africa continent don’t even have adequate and affordable enough broadband speeds to support stable cloud service usage.

The decades of ignorance and poor fundamental infrastructure are other visible factors affecting cloud adoption.

The most important force that can promote cloud is the government. Many African governments advocate a more centralized and monitored model; while some are inclined to shut down the Internet — an entirely different opinion showing a lack of political will.

Why does Africa need to be in the spotlight?

Cloud Markets

The typical case of the African cloud, in the midst of shortcomings mentioned above, also points out to fair opportunities. The opportunities significant enough to provide a path for entire Africa to enter the fourth industrial revolution.

The cloud services sector is in the early stages, but it already started impacting the different sectors. The proof of this is African banks investing in machine learning and artificial intelligence tools to enhance customer experience.

Kenyan government-managed Huduma centers are leveraging VMWare’s virtualized infrastructure to enhance public service delivery. Various large retail firms have taken compute capabilities and AWS databases into use to enhance the ways to reach the digital customer base. Even the startups are hopping on the cloud to disrupt the country-wide market segments.

The African cloud might seem small for now, but the best part is that it is already here and proliferating. Cloud, virtualization, and serverless computing came as disruptive technology developments since the mobile payment revolution first appeared in Africa.

The numbers that present a positive picture

Xalam Analytics’ “The Rise of the African Cloud” report states,

  1. The African cloud market registered a rate of 30% a year over the past three years.
  2. Top-line revenue from African public cloud services is projected to increase three times over the 2018-23 period.
  3. The collective revenue generation is forecasted around $2bn in top-line revenue by other segments in the African ICT space.

African cloud market

Nature of African Cloud Market

The African cloud market has a dynamic nature. How? On the bright side, AWS and Huawei are announcing the cloud services to make generally available from South Africa. On the other hand, French cloud services provider OVH was shutting down its Dakar-based West Africa office due to low service adoption.

Cloud leads to faster development and quicker learning within organizations, therefore accelerates innovation as it significantly removes overhead costs incurred by maintenance and updates. This is the reason the entire globe is adopting cloud, and this is the reason why African businesses are adopting cloud and needs to if they still haven’t.

Cloud Evangelist
Cloud Evangelist
Cloud Evangelists are CMI's in house ambassadors for the entire Cloud ecosystem. They are responsible for propagating the doctrine of cloud computing and help community members make informed decisions.

Cloud

Cloud Management