Cloud growth to accelerate, transform APAC industries

SINGAPORE--Cloud computing is expected to mature and become a mainstream technology for businesses in Asia-Pacific by 2015, as more industries such as the banking and utilities sector experience cloud-driven transformation. Enterprise communications is another potentially high-growth arena in 2012, Frost & Sullivan forecasted.

Andrew Milroy, vice president of Asia-Pacific ICT Research at Frost & Sullivan, revealed that the Asia-Pacific, excluding Japan, cloud computing market is expected to grow at the compound annual growth rate (CAGR) of 39 percent over a five-year period starting 2010 to hit US$5.8 billion by 2015. This rate of growth is "phenomenal" when compared with the region's overall ICT market growth of 7 percent, he added.

Speaking at the research firm's 2012 Outlook briefing held on Tuesday, the executive said organizations here are now understanding the benefits of cloud computing, such as increased business agility, costs reductions and moving away from capital expenditure (CAPEX) to operational expenditure (OPEX). This is seen in an internal survey in which 27 percent of respondents "somewhat agreed" that cloud computing will be their No. 1 priority for the current and upcoming fiscal years, while another 11 percent "strongly agreed", he noted.

There is also more pressure on IT professionals to procure cloud services now, Milroy stated, with 31 percent indicating in the same survey that they feel this pressure from the top management.

Cloud computing is expected to give businesses in specific industries the edge over their competitors too, the vice president said. Examples of such cloud-driven transformation, which offers scalability and speed to market, include allowing innovative banks to develop "branchless banking" online facilities, and retail outlets to offer virtual storefronts that will spur e-commerce, he elaborated.

The Frost & Sullivan forecast corroborates what IDC had predicted earlier, stating that cloud computing will come of age by 2015. This will happen as key issues such as security, service availability and data sovereignty are expected to be mitigated in four years' time, according to the ZDNet Asia report.

PaaS competition rises
Within the cloud computing industry, Milroy pointed out that platform-as-a-service (PaaS) will become the next "battleground" among IT vendors. In fact, he stated that PaaS providers will "venture aggressively" into both software-as-a-service (SaaS) and infrastructure-as-a-service (IaaS) arenas as they look to corner the market.

Salesforce.com, with their Force.com offering, will continue to enjoy an advantage over its competitors due to its early-mover advantage, he said. But with Microsoft with Azure and Google with its App Engine platforms developing well over the last 18 months, Milroy expects two or three primary platforms boasting a critical mass of apps to emerge in the coming year.

While PaaS might receive the most attention from vendors, SaaS continues to be the primary cloud service businesses are adopting and the market can expect "explosive growth ahead", he said. SaaS players will have to move beyond pure SaaS offerings and look to provide platform-based services to ensure customer loyalty though.

Enterprise comms goes cloud
Beyond cloud computing, enterprise communications will be another area of potential high growth in 2012. Pranabesh Nath, industry manager of ICT Practice Asia-Pacific at Frost & Sullivan, who spoke at the same briefing as Milroy, said the industry in general is growing about 10 percent year-on-year--which is "quite positive"--while the Asia-Pacific market, specifically, is expected to grow 10.8 percent to be worth an estimated US$4.95 billion in 2012.

He also predicted that enterprise communications will evolve in the coming year to be "richer, more collaborative and increasingly move toward the cloud".

The move toward cloud, in particular, can be attributed in part to organizations showing and increasing interest in having a utility-based pricing model for enterprise communications services provided by vendors such as Cisco, Microsoft and IBM, Nath pointed out.

"This allows them to better manage their finance in a predictable fashion when it comes to technology adoption or upgrades," he added.

Security and privacy of data are still concerns for enterprise, the manager said, but service providers are focusing their efforts in this area as well as offering private and hybrid cloud alternatives to help alleviate their concerns.

Frost & Sullivan's top 10 ICT predictions for Asia-Pacific in 2012 are:

• 1. Mobile platforms hit critical mass across smartphones, tablets 
• 2. Platform play across ICT sector become critical value generator
• 3. Real-use cases in business environment with enterprise social networking
• 4. Fixed broadband, 3G/LTE provide options for high speed access
• 5. "Internet of Things" accelerate, create opportunities for value creation, new business models
• 6. Big Data, analytics deployed through various platforms, enabled by emerging technology
• 7. Cloud computing mainstream in APAC region, PaaS new battleground
• 8. Telco transform with more telcos coming under revenue growth pressure
• 9. Enterprise communications richer, more collaborative, move toward cloud
• 10. ICT as an enabler continue to gain momentum, move beyond pure ICT industry