Computer services market enjoys solid growth

While much of the local economy is in the doldrums, a study conducted by the Information and Communication Technology (ICT) Ministry and the National Science and Technology Development Agency suggests the computer services industry will see a strong increase in sales during 2015, growing by about 12.4 percent to 51.9 billion baht in value.

The computer services market covers seven specific areas: systems integration, network support, software maintenance, hardware maintenance, IT consulting, IT outsourcing, data centre and managed services.

It is expected that the data centre and managed services sectors will see the highest growth, jumping around 23 percent to be worth about 5.7 billion baht this year. This is due to new investment by businesses which are capitalizing on the government’s planned construction of national data centres and the tax incentives to promote local data centre development.

Infrastructure as a service is one of the highest growth areas within the data centre and managed services sector, driven mainly by the move to cloud computing to reduce IT investment and maintenance costs. This part alone is expected to grow by a little over 33 percent to a value of 2.3 billion baht.

Network support services will see the second-highest growth, rising 17.2 percent to a value of 11.2 billion baht with IT consulting up by 16.4 percent to 6.1 billion baht. Systems integration is expected to be up by 11.8 percent to be worth 15.6 billion baht. IT outsourcing should rise around 10 percent to a value of 5.4 billion baht and software maintenance services will see a rise of 7.1 percent to 4.8 billion baht.

The only area experiencing a contraction is in the hardware maintenance services sector which is expected to shrink by just over 10 percent as businesses shift to the cloud instead of spending more to maintain existing hardware.

The local hardware market has contracted every year since 2012 and is unlikely to see any turnaround until such time as the overall economy improves.

System storage is facing the highest growth in the hardware market because of investment in data centres and the adoption of big data, cloud and disaster recovery. It should be worth around 14.5 billion baht.

The local PC market has only marginally improved since the political crisis of 2014, when it contracted by nine percent. This year the expectation is that the market will shrink a further 5.2 percent, although it will still bring in around 50.5 billion baht. It has been largely affected by consumers moving towards smartphones.