(MENAFN- The Peninsula) The IT services market of Qatar is changing at a rapid pace. Qatar is expected to lead IT services spending in the region through 2018, according to International Data Corporation (IDC). IDC is the premier global provider of market intelligence and advisory services.
According to IDC's latest forecast, the combined IT services market of some of the countries in the region, including Qatar, Oman, Bahrain, and Kuwait, is expected to expand at a compound annual growth rate (CAGR) of 12.5 percent over the coming years to total $1.82bn in 2018. The global advisory services firm expects this growth to be driven by government-led infrastructure development projects, e-government initiatives, transformations in the transportation and banking and financial services sectors, and private sector developments as governments in the region pursue diversification strategies into non-oil sectors.
"The willingness of CIOs to procure outsourcing services is increasing across the OGCC countries," says Eric Samuel, a senior analyst for IT services at IDC Middle East, Africa, and Turkey. "And we are now at a stage where CIOs are actively evaluating the capabilities of ICT service providers to build and operate their ICT environments. Some organisations are already reaping the benefits associated with these technologies, such as improved operational efficiency, reduced capital expenditure, and enhanced ICT management. And as the outsourcing services offered by ICT services providers mature over the coming years, we expect the adoption of such services to increase notably."
The IDC data shows that the OGCC IT services market reached a total value of $1.13bn in 2014, up 11.7 percent on 2013. Qatar presented the strongest growth in the region, with IT services spending fuelled by large-scale, infrastructure-driven, and government-led projects in the transportation, healthcare, and education sectors. Qatar will continue to have the fastest growing IT services market of all the GCC countries, and IT services spending in the country will surpass Kuwait's total by the end of this year. Qatar is also expected to lead IT services spending in the region through 2018.
The competitive landscape in Qatar is changing at a rapid pace. An increasing number of global ICT companies are now competing with local ICT providers, either directly or through partners, as they strive to capitalise on the myriad ICT opportunities present within the country. However, this increasing competition is exerting downward pressure on project pricing, which is impacting the margins of many ICT providers in the region. ICT project pricing is also becoming more complex as greater numbers of organisations expect their ICT partners to develop and implement solutions that are capable of solving their specific business challenges rather than merely meeting their operational requirements.
IT services maturity has significantly improved in the region, and both public and private sector organisations are looking at implementing complex IT solutions while addressing the challenges associated with finding and retaining experienced in-house IT personnel," said Samuel. "As a result, organisations are expected to take a cautious approach to CAPEX outlays when implementing ICT solutions, and this is also expected to drive spending on hosting, cloud, and managed services over the coming years."
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