Singapore ICT Market Analysis

1 Executive Summary
ICT companies are pivotal across all sectors of Singapores economy. Singapore has an open environment encouraging competition where foreign infocomm companies and talents build on, complement and work hand-in-hand with local ICT businesses, and forge alliances with government, research and educational institutions. This report reviews five of the ICT clusters providing updates and highlighting opportunities in these dynamic sectors. Apart from e-government and e-health, the other four sectors are infocomm security, cloud computing, mobile solutions and apps, and creative, multimedia, video and gaming sectors Led by the Infocomm Development Authority (IDA), Singapores e-transformation began with its civil service computerization programme in 1980. It gave rise to improved efficiencies from consolidation of computing resources and led to the creation of datahubs as well as first generation online government services such as TradeNet, LawNet and MediNet. Policy leadership and a clear cross-sectoral vision, coupled commitment to invest in an ultra-high-speed national broadband, are factors contributing to the country's success in maximising the economic and social returns from ICT. Highlights of its achievements include a worlds first in implementing a national electronic health record and leveraging on the Internet and mobile apps to facilitate access and collaborations between government, businesses and citizens. The fast growth in mobility, social media and cloud adoption do present export opportunities for infocomm security companies. But these new technology platforms have also brought into focus many concerns about the need for confidentiality, integrity, availability and protection across all levels and layers of the infocomm system. ICT security companies with capabilities to address these needs, in addition to offering solutions to strengthen cyber eco-system and national security programmes, will be well placed to capitalize on the opportunities. The recent acquisition of Singapore-based DS3 by Gemalto is an indication of local technology innovation that has gained the interest of global companies. DS3s main product is its authentication server that can be easily integrated with existing hardware and software systems. At the time of acquisition in 2013, it has 100 customers, more than half of which are banks, and the rest are businesses and government department. With international connectivity and a vibrant ICT community, as well as reputation as a trusted communications hub, data centre hosting and cloud computing are two thrusts in Singapores aim to level up its ICT services. The availability of cloud has positive impact on disaster recovery and business continuity which are crucial for many companies, especially the financial sector. Not only has it brought down the cost but such services can simplify disaster recovery processes by utilising cloud-based software to automate entire recovery and migration procedures. Singapore offers local businesses incentives to adopt cloud computing. SaaS solution providers with capability to offer customized services can work with local SMEs which may qualify for various types of support from the IDA under several incentive programmes, one of which is ISPRINT.

Author: Ng Ek Heng ekheng@gmail.com July 2013

With a population of 5.3 million, Singapore has a mobile phone penetration rate of 150% putting the number of handsets, predominantly smartphone at 8 million. The high smartphone usage makes Singapore an ideal test-bed for mobile apps which has become a thriving industry. Singapore foresaw two big technological trends arising from the blurring of lines between platforms and devices labelled as Interactive Digital Media (IDM). The first is the digitization of media content while the second is the emergence of new ways for media consumers to interact with content. The IDM sector provides employment for 24,800 in the arts and culture sector, 47,300 in the design industry with 66,000 in the media sector, while accounting for US$5.9 b in 2011. As an advanced infocomm economy, Singapore no longer looks for incremental benefits from ICT. Infocomm companies that can transform the competitiveness of businesses through ICT or create new values from innovative use of information are well placed to offer their solutions in a market that is known to be transparent. US$1:S$1.2424

Author: Ng Ek Heng ekheng@gmail.com July 2013

2.

Introduction

Well-coordinated support from government agencies and transparency make Singapore one of the easiest countries to start a business. It has a world-class ICT infrastructure and is ranked second in the Global Competitiveness Index by the World Economic Forum. It owes its achievement to ongoing significant government investments in infrastructure, manpower training and a mindset of collaborations with industry. In 2011, there were 16,850 companies in the ICT sector contributing US$66.8 billion representing 7% of the countrys GDP and providing employment for 142,900 infocomm professionals in Singapore. Figures for 2012 show that ICT revenue reached US$82 billion with infocomm professionals increasing to 144,000. By 2015, Singapore envisions it will be an intelligent nation, a global city, powered by infocomm. The 2015 masterplan is a roadmap to transform of key economic sectors, government and society through more sophisticated and innovative use of ICT. Working with various agencies, the IDA is taking the lead to promote the infocomm cluster leveraging on ICT for economic and social development. The convergence of computers, telecommunications and broadcasting afforded opportunity for Singapore to take its earlier computerization initiatives to the next level by offering a slew of government services on the Internet. Following the global IPV6 launch in June 2012, Singapore has in place a regulatory policy to ensure local residential users can access both IPv4 and IPv6 content effective from lst June 2013. The current phase of e-Government and e-Health covering 2011-2015 is to fulfill its vision to be a collaborative government dedicated to facilitating more co-creation and interaction between the government, people and private sector. Indeed, the various industry verticals are seeing good growth and innovation through infocomm. One example is the media and entertainment sector where ICT is a critical enabler, especially with the convergence with broadcast and media. A 12% growth by the sector to US$2.8b in 2011 is a reminder of its potential Towards this end, the development of Mediapolis, Singapores 19 hectare flagship digital hub, will serve as a catalyst for the development, production, financing and distribution of emerging media and gaming technologies, contents and entertainment to the world. The first development at Mediapolis Fusion showcases the complementary mix of local and foreign companies. Homegrown media company, Infinite Studios, managing Singapores largest sound stages measuring 18,000 square feet and 10,000 square feet, is being joined by Globecast, which provides content management and delivery to broadcasters worldwide. Namco Bandai, a leading Japanese games developer, set up its Singapore office in April 2013 to serve as its regional centre for collaboration with its Asian partners on creating digital contents. Singapore's value proposition as a trusted and strategic IT hub is underscored by its international connectivity, world-class ICT infrastructure and vibrant ICT community, in line with global developments that have contributed to wider acceptance of cloud computing. In 2012, Singapore-based Swift service bureau Decillion sealed a deal with Fundtech to provide the US company with a physical presence in Asia. It will give Fundtechs customers in Asia access to local support in their own language and time zone.

Author: Ng Ek Heng ekheng@gmail.com July 2013

And in 2013, a survey by its Nanyang Technological University shows that Singapore ranks second, just behind the United States, in having the highest level of total entrepreneurial activity among 25 global economies. This survey by its Nanyang Technological University added a caveat in its report that local experts are concerned about access to professional services, which is deemed crucial for early-stage entrepreneurship. Stability and a holistic approach to improve the business and technology eco-systems continue to attract both niche infocomm industry players and global companies to Singapore. The country recognizes that it benefits not only from the strong economic spin-offs of such companies but also from their leadership in technology innovation and vertical market expertise. One point to note is the collaborative approach facilitated by IDA encouraging private and public sector interaction. This approach allows infocomm companies, new to the market, to gain a foothold by offering innovative solutions that can make a difference to business processes or create new business models and values. One initiative aimed at building up data analytics capability has prompted the setting up of a platform known as Data Innovation Challenge - launched in June 2013 - which is hosted at www.dextra.sg. This crowd-sourcing platform lets businesses interact with software companies and data experts and obtain ICT solutions to real-world problems.

Author: Ng Ek Heng ekheng@gmail.com July 2013

Source: IDA

Author: Ng Ek Heng ekheng@gmail.com July 2013

Contents: Singapore infocomm market analysis

1. 2. 3 4 5 6 7 8 9 10 Executive Summary Introduction e-Government/e-Health Infocomm Security/Mobile Security Cloud Computing Mobile Solutions and Mobile Apps Digital Creative Media/Online Gaming Singapore- 2013 and Beyond SWOT Analysis Accessing the Singapore ICT Market 10.1 10.2 10.3 10.4 11 Tax and Regulations Trade Events Professional/Trade Bodies Government

Recommendations 11.1 Success Factors

12

Market Entry Strategies 12.1 12.2 Indirect Entry and Risks Direct Entry And Risks

13

Appendices 13.1 13.2 References Highlights Of Incentive Schemes

13.2.2 Product Development and Innovation Grants/Technology Grants

Author: Ng Ek Heng ekheng@gmail.com July 2013