The answer to this question is invariably no, but there is certainly seems to be a difference in priorities.
After four years of focusing on Australia and New Zealand, I have recently returned to a regional role as the Chief Technology Officer overseeing the Asia Pacific region. I have to say I feel lucky to be working in such a dynamic and exciting part of the world. Although they say some things never change, my recent travels into Australia, New Zealand, Singapore, Hong Kong, Japan, Korea and Indonesia suggest the region has evolved in many exciting ways.
Booming economic conditions within the region have played a big part. While a number of countries including China, India and the emerging south east have been experiencing deceleration of late, the region largely escaped the downturn effects of the global financial crisis, with countries like China posting double digit growth by shifting focus to domestic demand. Although we are unlikely to see such unprecedented growth again anytime soon, economists are predicting a return to solid growth in the region with broader contribution from countries like Indonesia and Thailand.
In Asia today, 525 million people are considered to be middle class which is greater than the European Union. However by 2030, this number is expected to rise by a further 3 billion, with many being in the upper end possessing impressive spending power. This shift is happening quickly, with Asia Pacific showing the highest growth in smartphone sales than Europe or the Americas.
Education has proven to be a critical factor in rising prosperity. Over the years, investment in public universities across the region appears to be paying off as countries like China, Singapore, the Republic of Korea, Taiwan and Australia rising up the top 200 World University Rankings. Coupled with the accelerating rise in number of PhD’s, India produced 50% more last year and China 40% across all disciplines since 1998, skills gaps are being steadily closed meaning organizations are able to tap into more quality talent locally.
Of course, these factors alone do not drive the adoption of business and technology trends. Changes in social development and Government initiatives really move the needle, however it is interesting to understand Asia Pacific’s recent meteoric rise, as well as its challenges ahead to appreciate just how its adoption of technology will be different to the other parts of the world. These factors, together with the regions epic scale will result in slightly different priorities for the years ahead.
With this perspective, here are the top 5 business and technology predictions I see evolving in Asia Pacific for 2014;
1. Big data analytics will go beyond the proof-of-concept phase and into production in established markets.
Organizations, particularly in highly competitive segments will have to find ways to uncover value from within their existing data stores and deploy scalable infrastructures to extract meaningful outcomes from big data projects.
We have seen examples of this already, rival retailers Woolworths and Coles in Australia are investing heavily in their loyalty rewards programs to reveal deeper insights into their customers shopping habits to sell insurance and target those who are better risks. Meanwhile in China, e-commerce giant Alibaba has entered the non-bank financial market with an attractive savings product which offers the convenience of on demand deposits and withdrawal, but with higher wealth management like returns. By analyzing years of merchant and customer buying records, they claim to be able to more accurately predict credit risks of its customers and manage it liquidity.
In the recent Economist Intelligence Unit (EIU) Asia Pacific Big Data Survey, sponsored by HDS, over 70% of organizations in the region believe big data adoption will improve their profitability, productivity, and innovation. However, many organizations find that software, skills and their existing information systems hinder the effective gathering of data for analysis as the information is stored and managed in separate business systems, information silos, formats, and media. The big data challenge comes in two forms: organization and technology.
Hitachi is investing in Big Data in a big way, in June this year we announced the establishment of a Global Centre for Innovative Analytics (HGC-IA) linking together a number of operating units and R&D across the world. By bringing together not only different disciplines, but also capabilities such as consulting, services, design and manufacturing with our customers, the opportunity to co-innovate will accelerate the development of end-to-end big data solutions.
2. As the cloud-broker model gains traction in Asia Pacific, organizations will transform their IT departments from technology implementers to business innovators.
Organizations will transform their IT departments from technology implementers to business innovators. Enterprises with high-demand IT infrastructure and application services will start exploring the cloud-broker model, preferring to work with providers who act as vendor-neutral third-party cloud services brokerages.
InfoSys announced their Cloud Ecosystem Hub over a year ago, aggregating infrastructure and application service offerings and helping customers transform their legacy IT into hybrid cloud environment. In Japan, Hitachi offers secure services to Amazon Web Services and Microsoft Azure through its Harmonious Cloud Data Centres, helping customers protect sensitive data assets as well as links to international data centers.
When it comes time to refresh technology, the focus will be on applications and business outcomes rather than infrastructure life cycles. Enterprises will start turning to their system integrators, service providers and internal IT organizations to play the role of cloud-service broker. We have already seen this transformation taking place in large organisations like the Commonwealth Bank, as they create the ecosystem and competitive playing field to drive innovation and value.
3. Concerns over data security will reach a tipping point, not only for the mobile data that moves between devices and the cloud, but also for data in content repositories.
Countries like Hong Kong , Singapore, and South Korea have already enacted new laws and legislation to protect personal privacy, with Australia and India to follow in the new year. This is prompting organizations to re-examine their security policies and look to solutions such as auditability of their data assets, encryption and enterprise file sync and share to address these issues.
Organizations will not only increase their emphasis on mobile and edge security, but also implement stricter security and data management practices inside their centralized data centers. They will have to use modern technologies to manage and automate these processes; otherwise the cost of compliance could be very high.
4. The Asia Pacific region will witness an explosion of unstructured data from mobile communications.
The exponential growth of the middle class, coupled with the affordability of smartphones will have tremendous implications for the growth of mobile data in the region. According to ABI Research, 63%of mobile telcos across Asia had rolled out 4G LTE services, were conducting trials, or had firm plans last year to deliver 4G LTE services . Ericsson has also forecast that 85% of mobile subscriptions in Asia Pacific will be 3G/4G by 2019.
To manage the growing volume of digital content services to consumers, telecom operators will need to develop a scalable, high-performance and reliable IT infrastructure architecture that incorporates flash-based storage and intelligent content delivery networks to meet these high-bandwidth requirements.
Nowhere else has this potential been proven more than with the release of Korean pop sensation Psy, and his online hit Gangnum Style. As I write this blog the number of YouTube views is sitting at over 1.8 billion (give or take a few million), this represents a staggering 42 views every second since it was released!
Not only does this demonstrate the awesome potential of viral social communications, but the need for network providers to adapt to rapidly evolving consumer preferences, literally minute by minute.
Telecom operators will need to deploy sophisticated data management solutions to address needs for both content delivery and data analysis. Those that do will gain a competitive advantage in the long term.
5. Competition between different countries and regions to become the digital hub of Asia will enter a critical stage in 2014.
We have seen a slew of local and international service providers invest heavily in the region, setting the stage for a competitive market over the coming years. Research into Collaborative Cloud Services shows that stronger demand for such offerings in Asia Pacific versus Europe and the Americas, with a greater number of organizations currently using or planning to invest in Software-as-a-Service. A number of US based providers like Rackspace, Amazon, Microsoft and ComputeNext have all expanded their presence recently. Hitachi Data Systems also launched in Cloud Service Connect in Hong Kong earlier this year offering Software-as-a-Service.
Some countries are even vying to establish specialist offerings. Internet giant Alibaba acquired Kanbox earlier this year to offer personal cloud storage service to it consumers. The Infocomm Development Authority of Singapore is investing and seeking partnerships to build a centre of innovation for big data and analytics to position itself as a hub in the region.
Service providers will invest in state-of-the-art facilities and advanced infrastructure to differentiate their services.
According to Gartner, the current data center space available is India is about 3.7 million square feet as of 2012-end. This is estimated to rise to 6.3 million square feet by 2017. In another report from Frost and Sullivan, they estimate that 40% of data centre capacity in Australia is outsourced and will grow to a $1.5B AUD market by 2019, driven by the growing number of “as-a-Service” offerings.
Organizations will use the growing trend of cloud as an opportunity to transform their legacy IT to new consumption-based IT models. Many will start with the deployment of on-premise private clouds for their core applications. Other organizations that are more advanced in their cloud journey will move their enterprise applications off premises to cloud service providers, and together with on-premise converged platforms for other applications create a hybrid cloud.
In future blogs, I will explore how particular organizations are adapting to these trends and how Hitachi Data Systems is helping them innovate with information.
In the meantime, I wish everyone a happy festive season with their family and loved ones.