Finance sector investment, cloud computing, digital economy scheme among main factors behind better performance than in sluggish 2015
The Software Industry Promotion Agency (Sipa) forecasts that the value of the Thai software market will reach Bt57.2 billion next year, representing growth of 4.3 per cent from the Bt54.8 billion expected to be generated this year.
Software-enabled services, cloud computing, the Internet of Things (IoT), big data and analytics are the main factors driving software-market growth of 4.4 per cent this year, the agency said.
Vice president Suwimol Taewasillachaikul said a Sipa survey had found that finance-sector growth and the government’s PromptPay project would encourage financial institutions to invest in system and software security to support their own systems and build confidence among customers when it came to conducting online transactions.
Moreover, telecommunication operators will continue to utilise software and hardware to transform their third-generation systems into 4G networks, while the national broadband project will also boost the software industry as a whole, she said.
The survey also found that software-enabled services such as Agoda and Ookbee, which came with new business models that supported new consumer lifestyle and behaviour patterns, were additional factors transforming the software industry across the country.
Cloud technology, software as a service, IoT, big data and analytics are also increasingly key drivers for software-sector growth in Thailand this year and in the future, she added.
The vice president said Thailand had around 348 tech start-ups able to raise more than Bt1.1 billion combined in funding, according to the survey.
These start-ups are also central to the development of new services and business models to support people’s new lifestyle and behaviour patterns in the digital age, and will therefore play a major role in driving the software industry, she explained.
Thanachart Numnonda, executive director of the IMC Institute and leader of the Sipa survey team, said overall software development and software services in the Kingdom last year were valued at Bt52.5 billion, some 1.2 per cent higher than the amount generated in 2014.
The sluggish year-on-growth was largely down to the domestic economic slowdown and delayed investment in large projects by both the government and private sectors, he said.
However, mid-sized businesses – those generating annual revenue of between Bt100 million and Bt500 million – were the main market segment driving the software industry’s growth during 2015, as they continued to invest in software to support their business, he added.
The market for embedded software last year expanded to Bt6 billion, Thanachart said, with developers in the segment using IP-based system design and developing products as in-house producers, to support companies wanting to utilise embedded programs to support their own businesses and products.
Sipa expects the embedded-system market in Thailand to grow by 5 per cent this year, and by 6.9 per cent in 2017.
More use of local software
Jirawan Boonperm, who chairs Sipa’s executive board, said the software industry as a whole was continuing to expand, as business customers now used much more local software for their operations, while the government’s digital-economy scheme would also increasingly propel the sector forward.
Moreover, the agency also has a role as facilitator to encourage small and medium-sized enterprises to use local software both in their traditional operations and to transform their business into the online arena, which would make it easier to manage their business and promote their products and services to potential customers in the domestic and international market places, she added.
Nakrop Niamnamtham, managing director of Force Secure – a local distributor of security solutions – said the software industry in Thailand had shown high growth potential this year, with the chief factors propelling the market being the government’s “digital economy” scheme and the banking and financial sectors utilising more innovation and technology to provide online banking and cyber-banking.
Moreover, the mobile application and gaming sectors will continue to be engines of software-industry growth this year and next, since they provide new services and apps to support demand from consumers with broadband access, he said.