The Quantification of South Africa SME Cloud Market
1. This document is offered compliments of
BSP Media Group. www.bspmediagroup.com
All rights reserved.
2. The Quantification of South Africa
SME Cloud Market
Profit from the cloud
Alex Fine
Sales Director Sub-Saharan Africa
TM
3. Introduction to Parallels
• Global software company headquartered in
Renton, WA, United States
• African HQ in Johannesburg, South Africa
• 12 years of experience in the Cloud & Hosting
space
• 900+ people
• Close strategic partnerships with IBM, Cisco and
Microsoft
• Certified for ISO 9001 and 27001
• Parallels helps service providers to grow and
profit from the cloud with
•
•
Deep industry expertise
•
Profit from the
Cloud™
Software
and our open partner ecosystem
SOFTWARE
2
Profit from the cloud
TM
4. Parallels in the Telco and Cloud/Hosting market
3
Profit from the cloud
TM
6. The cloud services market in South Africa
has grown to $165M USD in 2013
South African SME Cloud Services Market in
$Millions (2013)
2013
R 2.0
$165M USD
R 1.6
R 1.2
R 0.8
R 0.4
$72M USD
$40M USD
$34M USD
$19M USD
R 0.0
Infrastructure as a Web Presence
Hosted
service (IaaS)
and Web
Communication &
Applications
Collaboration
5
Business
Applications
Total
Profit from the cloud
TM
7. SME Hosted Service Penetration Rates
SME Cloud service penetration rates (South Africa,
2013)
2013
30%
27%
85% of
these are 3rd
party hosted
25%
20%
20%
16%
15%
10%
8%
7%
5%
1%
0%
Hosted
Infrastructure
Website
Hosted Email
6
Paid Hosted
Email
Hosted PBX
Business
Applications
Profit from the cloud
TM
8. South African Cloud market for SME expected to
reach $189 USD by 2016
$189M USD
$156M USD
34%
42%
10%
21%
2013
2016
Business Applications
Hosted Communication & Collaboration
Web Presence and Web Applications
Infrastructure as a service (IaaS)
7
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TM
10. Price by far the primary reason to keep servers
in-house; in-house specific apps also important
to medium businesses
60%
SME reasons to keep servers in-house (South Africa, 2013)
50%
Micro
Small
Medium
40%
30%
20%
10%
0%
Price
Security or
privacy
concerns
Bandwidth /
connectivity
issues
Specific
Specific
Not
application(s) application(s) recommended
not supported needs to be inby my IT
by any provider house / other
personnel /
tech. concerns
consultant
Note: Only including the 17% of SMEs with a server in-house
Source: Parallels SME Cloud Insights (South Africa, 2013)
9
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TM
11. Webserver, CMS, and Ecommerce systems are
top use of hosted servers with database
applications also widely used
Application penetration on hosted servers (South Africa, 2013)
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Micro
Small
Medium
Note: Only including the 25% of SMEs with a hosted server
Source: Parallels SME Cloud Insights (South Africa, 2013)
10
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TM
12. Server backup and security poised for most growth
among all SMEs in the coming years
SME plans to purchase add-on applications (South Africa,
2013)
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
Server backup
Security
Database
add-ons
Micro
Small
LAMP stack
Control panel
Development
platform
Medium
Source: Parallels SME Cloud Insights (South Africa, 2013)
11
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TM
14. 20% of SMEs have website; 85% of these are 3rd
party hosted
Website use among South African SMEs,
2013
30%
7%
25%
6%
All SMEs
3rd-party
hosted
website
3%
17%
Self-hosted
website
3%
No website
20%
80%
15%
10%
17%
23%
20%
5%
0%
Micro
Small
Third-party hosted
Medium
Self-hosted
Source: Parallels SME Cloud Insights (South African, 2013)
13
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TM
15. Overall, strong growth potential for web apps;
SEO and security have highest demand in
coming years
40%
35%
SME plans to purchase web applications (South Africa, 2013)
30%
25%
20%
15%
10%
5%
0%
Search
Security and
Mobile
engine
health
optimization
optimization monitoring
SSL
Content
E-commerce
certificates management capabilities
Micro
Small
Backup
Content
delivery
network CDN
Site building
tools
Medium
Source: Parallels SME Cloud Insights (South Africa, 2013)
15
Profit from the cloud
TM
17. Hosted email and ISV/free email highest use; 66%
of SMEs have yet to get email
SMEs with Email Accounts (South Africa, 2013)
All SMEs
100%
ISP or Hosted
Service Provider
66%
66%
2%
Free email
provider
16%
No email
66%
66%
50%
2%
16%
6%
9%
16%
20%
19%
Micro
25%
16%
In-house
server
75%
Small
Medium
Free email provider
In-house server
13%
2%
0%
Hosted service provider
No Email
Source: Parallels SME Cloud Insights (South Africa, 2013)
17
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TM
18. PLANS: 40% SME’s consider purchasing hosted
emails
SME plans to purchase hosted email
80%
70%
60%
50%
43%
40%
30%
34%
40%
20%
10%
24%
17%
11%
0%
Micro
Small
Yes
Medium
Maybe
Source: Parallels SME Cloud Insights (South Africa, 2013)
18
Profit from the cloud
TM
19. SME hosted PBX use is very small; most SMEs
use land lines or mobile phones only
PBX Use (South Africa, 2013)
100%
3%
0%
2%
1%
3%
90%
80%
18%
30%
36%
No phone
lines
50%
73%
50%
20%
16%
1%
2%
8%
Micro
0%
Regular
phone lines
49%
17%
Hosted /
Virtual PBX
1%
58%
30%
10%
30%
In-house PBX
60%
3%
Mobile phone
lines only
70%
40%
All SMEs
Small
Medium
Hosted PBX
Regular phone lines
No phone lines
In-house PBX
Mobile phone lines only
Source: Parallels SME Cloud Insights (South Africa, 2013)
19
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TM
20. Price is main concern for switching to hosted
PBX, & many SMEs have already paid for inhouse PBX
SME reasons against switching to hosted PBX (South Africa, 2013)
60%
50%
40%
30%
20%
10%
0%
Price
Already paid
for an inhouse PBX
Technical
concerns
Micro
Security and Do not know Learning a
Not
We are
privacy
about
new product / recommended planning to
concerns
hosted/virtual complexity
by my IT
switch
PBX
personnel /
consultant
Small
Medium
Source: Parallels SME Cloud Insights (South Africa, 2013)
20
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TM
22. Instant collaboration, file sharing, backup and
payroll/HR are most important overall
25%
SME application Use by size (South Africa, 2013)
20%
15%
10%
5%
0%
Instant
File sharing Online back- Payroll and
Online
collaboration
up and
HR
accounting
storage
Micro
Support /
Phone
Virtual
Web
Online CRM
Help desk conferencing desktop/VDI conferencing
Small
Medium
Source: Parallels SME Cloud Insights (South Africa, 2013)
22
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TM
23. SMEs indicate highest likelihood of adopting
online backup and storage and instant
collaboration tools in next 3 years
SME plans to purchase online applications (South Africa, 2013)
60%
50%
40%
40%
18%
30%
29%
26%
20%
10%
29%
27%
26%
23%
23%
25%
17%
12%
10%
9%
0%
8%
10%
9%
6%
Online backInstant
Online
File sharing
Phone
Payroll and
Virtual
Web
Support /
up and
collaboration accounting
conferencing
HR
desktop/VDI conferencing Help desk
storage
Yes
20%
6%
Online CRM
Maybe
Source: Parallels SME Cloud Insights (South Africa, 2013)
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Profit from the cloud
TM
24. 78% of SMEs show some preference to buying
apps in bundles; small and medium SMEs have
stronger preference for a single service provider
Purchase online applications as part
of a discounted package/bundle?
How important is it to you to buy cloud
services from 1 provider (scale 1-10)
10.0
100%
9.0
90%
8.0
80%
7.0
70%
7.0
6.0
5.0
7.1
60%
5.8
27%
30%
59%
61%
Small
Medium
33%
50%
4.0
40%
3.0
30%
2.0
20%
1.0
10%
-
0%
Micro
Small
46%
Micro
Medium
Yes
Maybe
Source: Parallels SME Cloud Insights (South Africa, 2013)
24
Profit from the cloud
TM
