Software as a Service - Africa | Statista Market Forecast

Revenue in the Software as a Service market is projected to reach US$2.35bn in 2024.
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Revenue is expected to show an annual growth rate (CAGR 2024-2029) of 21.17%, resulting in a market volume of US$6.15bn by 2029.
In global comparison, most revenue will be generated United States (US$187.20bn in 2024).

Definition:

Software as a Service (SaaS) refers to the type of public cloud service that delivers software applications over the internet on a subscription basis. Users can access and use the software through web browsers without having to install or maintain it locally. SaaS eliminates the need for purchasing, installing, and updating software, thus offering convenience and automatic updates while allowing users to focus on using the software to meet their requirements. The SaaS market includes the companies that provide these types of cloud-based software resources and services to individuals, businesses, and organizations. A typical example of this type of service is Microsoft Office 365, an SaaS suite of applications (e.g., Word, Excel, and PowerPoint) available for purchase by subscription and accessible via a web browser.

Additional Information:

The Software as a Service (SaaS) market comprises revenue, revenue change, average spend per employee, and key player market shares as key performance indicators. Only revenues that are generated by primary vendors at the manufacturer price level either directly or through distribution channels (excluding value-added tax) are included, and revenues generated by resellers are excluded. Revenues are generated through both online and offline sales channels and include spending by consumers (B2C), enterprises (B2B) as well as governments (B2G). Detailed definitions of each market can be found on the respective page where the market data is displayed.

Key players of the SaaS market include companies such as Microsoft (Office 365), Salesforce (Customer 360), Oracle (Cloud applications), and IBM (Cloud).

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Enterprise software, such as SAP ERP, Oracle ERP Cloud, Salesforce CRM, and Microsoft Dynamics365
Productivity software, such as Microsoft 365, Google Workspace, and Adobe Creative Cloud

System infrastructure software, such as Microsoft Windows Operating System and Linux Operating System
On-premises software, such as on-premises versions of Microsoft Office, SAP ERP, and Oracle Database
Business-Process-as-a-Service (BPaaS), such as payroll management and accounting solutions via ADP Workforce Now, Intuit QuickBooks Online, Workday, and Oracle NetSuite

The Software as a Service market in the Public Cloud market in Africa is experiencing mild growth, influenced by factors such as increased adoption of digital technologies and growing health awareness among consumers. Convenience offered by online services is also contributing to this growth.

Customer preferences: As the adoption of cloud-based services continues to rise in Africa, there has been a noticeable increase in demand for Software as a Service (SaaS) solutions. This can be attributed to the growing trend of businesses and organizations moving towards digital transformation, seeking cost-effective and scalable solutions. Additionally, the rise in remote work and the need for collaboration and communication tools has also contributed to the growth of SaaS in the public cloud market.

Trends in the market: In Africa, the Software as a Service Market within the Public Cloud Market is seeing an upward trend in the adoption of cloud-based solutions by small and medium-sized enterprises (SMEs). This is driven by the increasing availability of affordable internet access and the need for cost-effective, scalable solutions. In addition, there is a growing demand for mobile-first applications, as more people in Africa access the internet through their smartphones. This trend is significant as it opens up new opportunities for SaaS providers to tap into a previously underserved market. It also has implications for industry stakeholders, as they need to adapt their offerings to cater to the specific needs and challenges of the African market, such as limited infrastructure and low digital literacy.

Local special circumstances: In Africa, the Software as a Service Market within the Public Cloud Market is heavily influenced by the continent's unique regulatory landscape. With varying levels of internet connectivity and infrastructure, African governments are taking different approaches to promoting cloud adoption. In South Africa, for example, the government has implemented policies to encourage the use of cloud services, while in other countries, regulations and privacy concerns are hindering the growth of the market. Additionally, cultural factors such as the preference for local data storage and the need for tailored solutions to address specific challenges in different regions also impact the dynamics of the market.

Underlying macroeconomic factors: The growth of the Software as a Service Market within the Public Cloud Market in Africa is greatly influenced by macroeconomic factors such as technological advancements, government policies, and investment in digital infrastructure. Countries with supportive regulatory environments and strong investments in digital technologies are experiencing rapid market expansion, while those with regulatory hurdles and limited investments are facing slower growth. Furthermore, the increasing use of digital solutions in various sectors, such as healthcare and education, is driving the demand for SaaS in Africa to improve access and efficiency. These factors are expected to continue driving the growth of the market in the region.

Data coverage:

The data encompasses B2B and B2C enterprises. Figures are based on the money spent at manufacturer price level (excluding VAT).

Modeling approach / Market size:

The segment size is determined through a top-down approach. We use financial statements such as annual reports, quarterly earnings, and expert opinions to analyze the markets. To estimate the segment size for each country individually, we use relevant key market indicators and data from country-specific industry associations, such as GDP and level of telecommunications infrastructure.

Forecasts:

We use a variety of forecasting techniques, depending on the behavior of the relevant segment. The main drivers are the GDP and the level of digitization.

Additional notes:

The data is modeled using current exchange rates. The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic is considered at a country-specific level.

This report presents a comprehensive analysis and additional information on the Technology market, in a PDF format.

Together with platform as a service (PaaS) and infrastructure as a service (IaaS), software as a service (SaaS) is one of the three primary tiers of cloud computing. It allows businesses to redirect resources away from IT hardware, software, and personnel expenses, and towards other business needs. Currently, the most prominent companies in the SaaS market are Microsoft, Salesforce, Oracle, SAP, and Google.