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Good progress but more needed

Two recent IT events held in Bangkok gave industry insiders a platform to discuss the possibilities for growth in Asia's tech sector as a whole

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Local programme designers have proved their potential in the global market, but there's still a long way to go if Thailand is to achieve its ambition of becoming Asean's software hub. However, the success of Software Expo Asia 2013, which wound up in Bangkok last weekend, was regarded by industry insiders as marking a significant step on that road. 

ILLUSTRATION © GETTYIMAGES/THINKSTOCK

Showcased at the three-day fair were a wide range of products under categories including food & agriculture, logistics, health, jewellery, animation, games, mobile applications, e-learning tools and new media. In addition to home-grown innovations which won Thailand ICT or Asia-Pacific Information and Communication Technology awards, some 300 software products, both local and foreign, were unveiled at what was the biggest software gathering in Asia to date.

Trairat Chatkaew, president of the Software Industry Promotion Agency (Sipa), felt that this was a turning point for the domestic sector.

"We believe that the Software Expo is a significant mechanism driving the business, paving the way for the adding of value to software spending," he said, noting that "business matching" (partnerships between local and international companies) facilitated by the Bangkok expo is expected to be worth in excess of 3 billion baht.

Thailand has set itself the goal of becoming a regional hub for software development within the next three years, the Sipa president added. Local software development has been going strong, he said, especially digital content and mobile apps, but one area that needs a boost is enterprise software. While fees are still charged for this based on licences, he said, the creators of enterprise software should be gearing up to shift to cloud technology as soon as possible as well as increasing the number of new products entering the market. Total software business in Thailand this year may be worth in the region of 70 billion baht and Sipa hopes to be able to drive this figure up to 100 billion baht within the space of three years.

ASOCIO COULD PLAY A KEY ROLE

Run in parallel with the Software Expo was an ICT summit organised by the Asian-Oceanian Computing Industry Organization (ASOCIO), a grouping of ICT industry associations from countries in the Asia-Pacific region.

N. R. Narayana Murthy, executive chairman of Infosys, noted that nations in Asia and Oceania combined had been responsible for more than 50% of economic growth in the world in the period following the Asian financial crisis of the late 1990s. One of the factors that contributed to this stupendous success story, he said, was the sizeable growth of the IT industry in the economies of these nations and the region's IT industry has grown to become a leading supplier and exporter.

"The convergence of technologies is happening at an unprecedented pace," Murthy said. "New technologies like 'big data', the Internet of Things, Cloud, 3D printing and mobile devices are spearheading this convergence. The impact of this convergence on business and consumers is multifold. It influences how enterprises compete in the market. It shapes how individuals communicate with businesses.

"The convergence creates avenues for innovative, efficient and cheaper products and services. It also means that the roles played by hardware, software and services are rapidly blurring."

Citing the latest report on the disruptive technologies by McKinsey & Co, Murthy predicted that by 2025, 12 key technologies _ led by the mobile internet, the automation of knowledge work and the Internet of Things _ would have the potential to deliver an economic value of up to US$33 trillion a year worldwide. For instance, "big data" could help reduce healthcare-sector expenditure in the US by 8%.

"Convergence of this type needs new ideas in user interfaces and useability. Countries like Japan and Korea are pioneers in device design and have done a good job in this field." From a services perspective, Murthy pointed out this convergence means drastic changes in the IT architecture of modern enterprises.

"Countries like India with its US$108 billion-strong services industry can leverage this opportunity," he said. "Also, growth of our economies has created significant opportunities for new segments like services for small and medium businesses through Cloud, content creation and commerce through the internet and mobile devices." Players in the Asia-Oceania region will have to make significant investments in building the required capabilities in these areas, he said. Governments across the globe are adapting to a post-economic crisis world, Murthy noted. Be it mature markets or emerging markets, governments are dealing with mounting economic and social pressures. To overcome these pressures, governments need to leverage IT to achieve two objectives: create the most efficient, transparent, fair and accountable public-governance systems to provide basic necessities such as healthcare, education, nutrition and shelter for every citizen; and create the most competitive private sector that can compete in the global markets to add to the economy's competitiveness and growth.

"We also have to invest heavily in research to be ahead of the curve in technology adoption cycles," he said, citing as an example the fact that battery technology has not progressed as rapidly as CPU or display technologies and noting that this lag in advancement will impede competitiveness in industries such as the smartphone sector.

"There are inherent threats which arise from technology convergence such as cyber security and piracy among others. A 2012 study by the Business Software Alliance estimated that China suffered the second-highest losses from piracy where 77% of all software sold was pirated. There is also a lack of infrastructure which could impede growth," said Murthy. He noted that to succeed as a region, countries have to learn from each other and work collaboratively. ASOCIO can play a key role in facilitating this cooperation, he added. With its 22 member countries, the organisation offers a unique network that can work towards the development of the industry and regional economies, he said.

"To propel the industry's growth, ASOCIO should focus on creating a common agenda for growth and development of the region's IT industry, increasing its influence on the policy-making of individual governments. This will enable the region's IT industry policies to be more harmonious and collaborative."

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