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Internet of things will be one of the Asean IT highlights in 2016

IoT investments will be one of the major trends in Asean economies throughout 2016, according to predictions from Frost & Sullivan.

The internet of things (IoT), cyber security, mobile payments, e-commerce and datacentres are the key technology highlights for Association of Southeast Asian Nations (Asean) countries in 2016, according to Frost & Sullivan.

IoT is expected to increase in Asean countries in 2016, with services expected to lead spending in the space.

In a briefing on upcoming IT trends in 2016, Frost & Sullivan estimates the IoT market in Asean to be valued at US$1.68bn in 2015, and expected to grow 35% a year to reach US$7.53bn in 2020. In comparison, total Asia Pacific (Apac) spending on IoT spending is forecasted to be US$79bn by 2020.

“The take-up rate in Asean countries is expected to be among the highest in the region due to lower initial IoT spending. However, the largest markets would still be the mature IT markets, including Japan, China, India and the Republic of Korea,” said Mark Koh, Frost & Sullivan research manager for IT in Apac.

As more IoT technology is adopted, there will also be a shift towards decentralised computing. For instance, peer-to-peer (P2P) networks will become more widely used, allowing connected devices to communicate directly with each other, rather than being routed through a centralised datacentre.

IoT security is paramount

Cyber security is also paramount as the increasing use of mobile devices and the gradual spread of the IoT will mean more attack vectors and will increase the risks of successful attacks.

Investment in systems and services to defend against advanced malware, advanced persistent threat, targeted attacks or DDoS attacks is also poised to increase significantly in the upcoming year, according to Frost & Sullivan analysts.

Two other big opportunities for Asean countries are mobile payments and e-commerce, said Frost & Sullivan. The top six Asean economies are expected to grow the e-commerce segment at a compound annual growth rate (CAGR) of 23% from 2015 to 2020, valued at nearly US$20bn, with Indonesia, Malaysia and Singapore expected to show the strongest growth. Indonesia will also become the largest Asean e-commerce market by 2020.

“We expect mobile payments to offer major opportunities for traditional point of sale players to move into upcoming mobile payment platforms,” said Ajay Sunder, vice-president of IT at Frost & Sullivan, Apac.  

Meanwhile, the Asean datacentre services market is expected to continue as the slowdown in growth in mature markets is compensated for by the increase in growth in emerging market. The Asean datacentre market is expected to grow at 21.4 % a year and reach $2.46bn by the end of 2020, said Frost & Sullivan.

Read more about enterprise IT in the Asean region

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