Shifting telco landscape seen favoring cloud computing

CLOUD computing services may find favor with micro, small and medium sized enterprises (MSMEs), particularly after changes in the telecommunications industry allow greater infrastructure support and network access, IP Converge (IPC) Data Services, Inc. said.

Reynaldo R. Huergas, IPC president, speaking at a news conference during the 2016 Philippine Cloud Summit, said two main factors currently impede the growth of cloud adoption in the Philippines.

“Whether that population is going to adopt cloud computing will depend on several factors, one of which is the actually availability of infrastructure and the deployment of network across the country, and I think we’re seeing that because the two telcos having invested mostly on infrastructure, and once those are completed, we’ll see demand,” he said.

According to IPC, cloud computing is currently dominated by large companies in information-heavy industries such as Information Technology and Business Process Management (IT-BPM) and the financial sector.

IPC, a unit of PLDT, Inc., cited data from marketing analysts Frost and Sullivan that said Philippine spending to enable the so-called Internet of Things (IoT) was only $55.1 million in 2014, growing to $766.8 million in 2020.

IoT is an initiative to make computing pervasive by making ordinary objects such as appliances more connected.

However, a number of unexpected, drastic developments have since taken place that were not considered at the time of the projection — such as the creation of the Department of Information and Communications Technology and the $1.5-billion buyout of San Miguel Telecommunication assets by PLDT and Globe Telecom.

When asked if the IPC projects accelerated growth in the cloud market because of these developments, Mr. Huergas said that added government support would provide a boost.

“Now we have somebody, now that the government is going put money into developing that industry, yes it will accelerate the industry itself.”

Speaking in the same news conference, King-Yew Foong, Research vice-president and chief of Research for Communications Service Providers, said: “The Philippines, comparatively, is maybe four or five years behind, say, a country like Singapore, and I will say Philippines is alongside other developing markets in ASEAN in terms of maturity of adoption.”

Morover, on a global scale, he said that IoT may see up to 20 billion objects deployed on the market in the next six years.

“So over-all we see by 2020, over roughly 20.8 billion connected things out there, which is basically three times the number of mobile phone connections by 2020. So average grow rate [on a compound basis] up to 2020 could be about 3% per year,” said. —