S-E Asia online economy seen at US$50bil this year
Research report predicts it will grow four-fold by 2025
SINGAPORE: South-East Asia’s Internet economy, spanning online travel to ride-hailing, will reach US$50bil (RM203bil) this year, putting it on a solid trajectory to grow four-fold by 2025, according to a joint research report by Google and Temasek Holdings Pte.
As more consumers buy airline tickets and book hotels through smartphones, the region’s online travel market expanded from US$19.1bil in 2015 to US$26.6bil in 2017, according to a report the two companies released yesterday. The research covered four key sectors of the Internet economy: travel, media, ride-hailing and e-commerce.
Online shopping and ride-hailing have come into focus as Grab, Uber Technologies Inc and Go-Jek capture consumer preferences with evolving business models. Of the US$12bil of capital invested in South-East Asian Internet companies since 2016, US$9bil was raised by its unicorns, or startups with more than US$1bil valuations. The region, which includes Singapore, Indonesia and Malaysia, raised just US$1bil in 2015. “This shows how global and regional investors have favoured the largest and most established Internet companies,” the report said.
The growth is being driven by a surging number of new smartphone users. South-East Asia will have 330 million monthly active Internet users by the end of 2017 – equivalent to the size of the US population – after adding more than 70 million users since 2015.
E-commerce sales of new goods will reach US$10.9bil in gross merchandise value in 2017, almost double their level in 2015, according to the report.
South-East Asia’s ride-hailing market, which is fiercely contested by Grab, Uber and Go-Jek, is expected to double from 2015 to US$5.1bil in 2017, before reaching US$20.1bil in 2025.
“Millions of users transact and play on their platforms on a daily basis, giving them a head start as they aim to build digital payment services accepted by online and offline merchants,” the report said.