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Internet of Things Heralds New IT Services Opportunities in 2016
November 20, 2015 | PRNewswireEstimated reading time: 8 minutes
"The Product as a Service model will become the norm in many industries. Over 70% of Fortune 500 companies will operate Product as a Service business models, with the Automotive Industry and Electronics Industry expected to lead this revolution at 15% and 13% respectively," noted Milroy.
Key examples of Product as a Service include auto makers offering car sharing services on a pay per use system (Automotive), medical device manufacturers offering health monitoring systems (Healthcare) and IT hardware providers offering separation of products and services businesses (IT).
2016: Digital Services Outlook
A new set of digital services are emerging as opportunities. The 2 big opportunities for APAC are mobile payments and e-commerce. For SEA alone, the e-commerce segment is expected to grow at a CAGR of 23% from 2015-2020 and will be valued at nearly US$20 billion for ASEAN countries with Indonesia, Malaysia and Singapore expected to show the strongest growth. Indonesia will also become the largest e-commerce market by 2020.
The key drivers for e-commerce growth include expanding middle class population, changing consumption and purchasing patterns. Also, one other emerging area will be mobile payments, which will account for more than 10% of total payment transactions in APAC by 2020 with emerging APAC countries showing higher growth.
"We expect mobile payments to also offer major opportunities for traditional PoS players to move into new mobile payment platforms," noted Ajay Sunder, VP, ICT, Frost & Sullivan, Asia Pacific.
2016: Data Centre and Cloud Computing Outlook
The Asia-Pacific data centre market is a state of flux with most service providers in the process of fine-tuning their strategies around data centres and cloud computing. On one hand, the industry is witnessing large scale data centre construction frenzy and with increasing demand from cloud-enabled technologies, such as Big Data and IoT, there is greater competition than ever before. This is leading to price erosion in the market as well as industry consolidation due to lower than expected Return on Investments. Putting that into context, Frost & Sullivan predicts that the industry will witness greater consolidation in the market, driven by the need to offload data centre assets. This will drive the entry of new players, such as utilities and real estate companies, into the market as we see backward and forward integration.
At the technology level, Hybrid IT has established itself as the new normal and will continue to dominate enterprise IT decision making in 2016. Lastly, Frost & Sullivan expects 25% of all enterprise IT workloads to move to the cloud by 2020, up from 12% in 2015. Overall, the data centre and cloud computing services market is expected to grow at a healthy CAGR of 20.5% to reach US$77.3 billion in 2020 from US$30.4 billion in 2015.
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