ICT industry to grow by 'only 3.8% this year'

Economy July 16, 2015 01:00


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THE ICT (information and communications technology) industry in Thailand is expected to grow by only 3.8 per cent this year, while innovation development will drive the industry in 2016, according to International Data Corporation.

Michael Araneta, country manager for IDC Thailand, said the Thai ICT market was experiencing a relatively tough year. The growth of ICT spending has always been 3-8 percentage points above that of gross domestic product, but this year it would only see a growth rate of 3.8 per cent to Bt677.8 billion. 
Last year, IDC predicted that Thai information-technology spending would rebound to 10.6-per-cent annualised growth. It now says enterprise ICT will play a larger role in the near future.
Araneta said many factors were having an impact on spending on IT, data services and communications. These included the availability of cheaper smartphones, lower prices of voice packages of telecom operators, delayed government projects, lower exports, politics, and lower GDP growth.
“Moreover, the year 2015 marks some permanent shifts in trends of the overall ICT market, especially in the adoption of ‘third platform’ technologies like cloud, mobility and big-data analytics. We expect a gradual recovery in 2016, but the coming year will see the start of a new era of IT, presenting ICT stakeholders with new contexts and challenges.”
IDC expects that ICT spending next year will grow by 4.5 per cent to Bt708.4 billion.
Jarit Sidhu, lead analyst for IDC Thailand, said that next year, the firm expects the factors driving the IT industry will come with the government, which plans to lay down hard and soft infrastructure to support its “digital economy” scheme. 
Meanwhile small and medium-sized enterprises will utilise new IT solutions and platforms to make their business more competitive by improving their productivity and efficiency. 
A third factor is ICT start-ups, which will help add to the ecosystem of the IT industry as a whole. 
Sidhu also said IDC believed the government’s pro-digital project would help boost the economy, make the country more competitive, and allow remote areas to access the Internet as easily as the people who live in metropolitan areas. However, IDC expects it will take several years to accomplish these goals. 
He said the digital economy would encourage the development of such industries as ICT manufacturing, ICT trade, ICT service, e-commerce and media. Sidhu said the enabler for the digital economy would be fourth-generation wireless broadband.
“Thailand’s telecom spending, driven by the high usage of mobile data, is forecast to grow by 6.2 and 6.5 per cent in 2015 and 2016 respectively. The commercial launch of 4G networks will be crucial to the growth of not only Thailand’s telecommunications sector but also the overall economy. 
“There is little doubt that 4G networks will be an important foundation for the digital economy. The sheer speed of 4G can improve productivity, drive innovation, facilitate new services and eventually create new businesses,” he said.