Google and Oracle ramp up cloud in Africa to tap fast-growing e-Conomy

By Seth Onyango, via bird story agency

Google Cloud announced on Friday (February 2) that it had opened its first cloud region for Africa, located in Johannesburg, South Africa. The new region will offer its core cloud services, such as computing, storage, networking, and security, to customers across the continent.

The move comes as research from McKinsey showed that while cloud-native startups in Africa are luring tech firms to ramp up spending on cloud facilities – improving connectivity constraints in the process – they are also being pushed to roll out faster by regulatory data residency rules.

McKinsey notes that prevalent data residency laws in Africa, like those in Algeria, Gabon, Niger, and Morocco demand localised data.

Kenya, South Africa, Tunisia, and Uganda also impose restrictions on cross-border data transfer. Tellingly, cloud providers are now expanding their footprint in Africa as they jockey for early dominance.

Oracle recently revealed plans to establish a new public cloud region for the continent from Nairobi to meet the growing demand for Oracle Cloud Infrastructure (OCI) services across Africa. It will be the firm’s second on the continent, after an earlier launch in Johannesburg in January 2022.

Both Oracle and Google are competing with other cloud providers, such as Microsoft Azure and Amazon Web Services, both of which have established regional cloud services from South Africa.

According to some estimates, demand for cloud computing services in Africa is growing at between 25% and 30% annually

A surge in cloud computing investments comes as the continent leapfrogs legacy internet technologies, with thousands of startups adopting cloud-native applications and platforms that are more agile, scalable, and cost-effective.

McKinsey said African companies which “can make the leap stand to gain a sizeable prize.”

These nimble enterprises, born and bred in the cloud, have become the focal point of attention for tech giants eager to contribute to and benefit from Africa’s expanding tech ecosystem.

McKinsey’s recent research projects a global cloud value of $3 trillion, with $797 billion of this value sitting in Africa and Europe, across what it categorised as the “Rejuvenate dimension (IT cost efficiencies) and the Innovate dimension (revenue uplifts and business operations savings).”

In Africa, cloud adoption among respondents is consistent across all regions, McKinsey notes, with the highest levels – 70% to 77% – in East Africa, West Africa, and Southern Africa.

Investors in the cloud space like Oracle and Google are also keen to develop cloud skills and talent.

Both companies have launched initiatives to train and certify African developers, students, and educators on cloud technologies and applications.

bird story agency