United Arab Emirates Information Technology Report Q1 2016
BMI View: The UAE IT market contracted in 2015 as a downturn in hardware spending dragged down the overall market.
We envisage a return to growth in 2016 and the growth rate to remain subdued but stable over the medium term.
Our forecast envisages a CAGR of 3.6% over 2015-2019 to AED19.2bn in 2019.
The hardware market will be challenging as a result of market maturity and economic uncertainty, but we have a brighter outlook for software and services as enterprise and government modernisation initiatives continue.
The areas of strongest growth will be cloud services and IoT solutions adoptions, with the UAE a regional leader for both.
Latest Updates & Industry Developments
Computer Hardware Sales: AED7.7bn in 2016 to AED7.6bn in 2019.
A combination of a saturated PC market, price erosion and an uncertain economic outlook will make hardware the underperforming segment.
Software Sales: AED3.5bn in 2016 to AED4.1bn in 2019.
Software-as-a-service provision will continue to deepen the enterprise application market, while we also have a bright outlook for cybersecurity spending growth.
IT Services Sales: AED6.0bn in 2016 to AED7.5bn in 2019.
Economic uncertainty will strengthen the search for cost efficiencies, benefiting outsourcing, managed services and cloud computing - and the UAE is also a leading market for Internet of Things (IoT) adoption.
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