2 March 2010 - Opening Speech by RADM(NS) Ronnie Tay, Chief Executive Officer, Infocomm Development Authority of Singapore, at the SiTF Business Outlook Forum
Opening Speech by RADM(NS) Ronnie Tay, Chief Executive Officer, Infocomm Development Authority of Singapore, at the SiTF Business Outlook Forum, 2 March 2010
Ms Tan Yen Yen, Chairman of SiTF
Mr Lim Seng Kong, SiTF Business Outlook Organising Committee Chairman
Members of the infocomm industry
Ladies and gentlemen
1. Good morning. I am pleased to be here this morning at this SiTF Business Outlook Forum.
Positive Outlook for the Economy and Infocomm Industry
2. The last two years have been challenging, with the world economy in a very major recession. During this period, companies reviewed their IT spending, prolonging their product replacement schedules or putting on hold less strategic IT projects, which inevitably impacted the infocomm industry.
3. Since the second half of 2009, the global economy has been showing signs of recovery. In a recently published outlook, the IMF (International Monetary Fund1) forecast that the world economy will grow by 3.9 percent this year and 4.3 percent in 2011. The global ICT outlook also appears to be improving, in line with the global economy. Worldwide IT and telecoms spending is expected to return to growth in 2010, after showing negative growth in 20092.
4. Singapore's economy is also turning around. It is expected to grow by 4.5 to 6.5 per cent3 in 2010, up from the 2.0 per cent contraction for 2009. The infocomm industry continues to be an important economic sector, contributing about 7.1 per cent4 to Singapore's GDP. According to the Economic Survey of Singapore 2009, the Information and Communications sector is one of the few sectors5 that showed positive growth in 2009. Singapore's general employment outlook also improved, with overall unemployment rated at 2.1 percent in December 2009, a significant improvement from the 3.4 per cent level in September 20096.
5. Singapore's infocomm ecosystem continues to be doing well. In the results released last month, Singapore topped the e-Government ranking by Waseda University in 2010, for the second year running. Infocomm adoption rates in Singapore also continued their steady rise. In 2009, 83 per cent of households have access to computers and 80 per cent of households have access to broadband, an increase of five-percentage point for both from the year before. Computer access in households with school-going children reached a new high of 95 per cent in 2009.
Identifying Emerging Opportunities for Growth
6. IDA will continue to work towards realizing our iN2015 vision, through our three strategic thrusts: encouraging sophisticated demand for infocomm, fostering the creation of innovative services and knowledge capital, and strengthening Singapore as an economic hub. By creating more opportunities through our various initiatives, we want to spur innovation and catalyse the growth of the infocomm industry; we also seek to identify global emerging trends that would create more opportunities for our infocomm industry in the longer term.
7. All of you would have read about the key recommendations of the Economic Strategies Committee that were announced last month. For Singapore's economy to continue growing, going forward, there is a need to boost skills in every job, deepen corporate capabilities to seize opportunities in Asia, and make Singapore a distinctive global city and an endearing home. Infocomm plays an important role here. Transformation through infocomm, marked by ever faster Internet speeds and the pervasiveness of the Web in all aspects of our lives, are changing the way we work, live, play and interact. In striving for productivity driven growth, companies will likely be looking to their technology partners to help them achieve that goal.
8. In support of one of the ESC sub-committees, IDA convened an IT workgroup comprising leaders from industry and academia to study areas where ICT can be a key enabler for growth, and where it can spur new growth opportunities. The discussions were wide-ranging and stimulating, and some of that could be put together in a framework that we can call the Internet of Knowledge.
Internet of Knowledge
9. The fundamental building block level of the Internet of Knowledge is connectivity for wired and wireless communications, provided by the hard infocomm infrastructure of networks, datacentres, exchanges and so on.
10. The next level would be the platforms, which refers to the soft infrastructure that brings different players together in some organized way, whether policies and regulations, collaborative initiatives such as TradeXchange and innovation centres, or commercial ventures involving hardware manufacturers and service providers. These platforms combine different parts of the value chain and bridge the gaps in the infocomm ecosystem, creating innovative services and catalysing service adoption.
11. At the core of the Internet of Knowledge is data. With the growth of the Internet, there has been an explosion of data. Data is created not just between machines, the so-called Internet of Machines, or between people, the Internet of People, but also between machines and people. With good connectivity and platforms, all these data can be transmitted, stored, processed, and exchanged efficiently.
12. With the advent of cloud computing, there can be further efficiencies to convey and process such data and information. It essentially enables the provision of scalable on-demand services, allowing new types of services, such as data-as-a-service, software-as-a-service, platform-as-a-service and infrastructure-as-a-service. End-users need only to pay for what they need, on a utility basis. For technology providers, this means moving from a traditional model of provisioning of infrastructure, platforms and services, to providing e-services on a pay-per-use basis. This paradigm is characterised by virtualisation of computing resources, huge scalability, and secure and reliable infocomm services, that are available anywhere, anytime, through broadband connection to the Internet or Intranet cloud.
13. Operationally, cloud computing enables companies to lower their costs of operations. Strategically, cloud computing provides new capabilities for companies to work closely together across diverse geographies, allowing them to expand their infocomm-enabled services to new markets. According to Merrill Lynch, the market size for cloud computing is expected to be worth some US$160 billion in 2011.
14. But with such a wealth of data today, it is not how much information and data we have, but how we can use it to help us make right, timely and strategic decisions that matters. Indeed, information analysis now trumps information wealth, and deriving insights from that analysis to create knowledge is therefore the key. We go from data generation and warehousing, to business intelligence and analytics, to decision support and user interfacing, and back to data creation again - what we can call the knowledge cycle.
15. Business intelligence and more significantly, business analytics, through applying computing processes such as querying, prediction and optimization to business data, can generate insights and knowledge for decision-making and strategy formulation. Business Analytics or BA is helping to move infocomm from a more supporting function to an integral part of business strategy, from being seen as a productivity tool, to becoming the nerve centre of an organisation, helping to create the new competitive advantages for organizations.
16. The global market size for BA is estimated by IDC to grow, reaching US$35B in 2012. Various sectors such as logistics, finance and retail can benefit significantly from applying BA. For example, financial institutions use BA to analyse, identify and mitigate credit and market risks in compliance with regulatory requirements. In the logistics sector, companies use BA to optimise supply chain management and improve control over the supply and management of components.
17. Together, BA and cloud computing can provide the ability to deliver high value "insights-on-demand" on Internet scale. Cloud computing enables BA-enabled systems to sense and influence diverse geographies. Cloud computing's distributed, quick-to-deploy and vast computational and storage resources can serve as the platform for Internet-scale data access for system-of-systems solutions. With infrastructure, storage and analytics already in the cloud, companies' entry into emerging markets can be streamlined with shorter lead times, lower fixed costs and easier interactions with local partners.
18. The insights and knowledge need to be presented in a way that can be easily understood and used. A key part of the Internet of Knowledge is therefore the Internet of Services, characterized by mobility, personalization, location-sensing and productivity. The insights and knowledge need to be presented as customer-centric services to end-users. For example, in the Retail sector, insights on consumer spending patterns can be leveraged by businesses to enable highly targeted marketing, personalised consumer experience, as well as advanced forecasting, inventory and retail space optimisation. In the area of Healthcare and Wellness, provision of patient care can be shifted from hospitals to the homes through mobility, enabling personal mobile health monitoring and advisory services for the consumers.
19. With BA and cloud computing underpinning the Internet of Knowledge framework, system-of-system solutions and smart consumer-centric services can be developed to address global challenges that we face today - sustainable development, urban living, high-quality education, citizen engagement, aging population, citizen productivity and so on.
20. The Internet of Knowledge can be a strategic enabler for Singapore to compete in the knowledge economy. We can leverage our advantages - our large base of regional and global HQs, reputation as a trusted and stable country, strong legal framework, sophisticated use of infocomm in the people, public and private sectors, as well as our status as an economic hub. This would yield material benefits for us, including the ability to strategically manage limited resources for sustainable development, enable Singapore-based companies to gain faster insights into new business opportunities in Asia, and to compete on knowledge to drive productivity and innovation.
21. It is therefore important for us to build up industry capabilities in BA and cloud computing - whether in manpower, R&D, platform or software, technologies, policies, and so on. Catalysing significant projects in various sectors that draw on BA and cloud computing capabilities and solutions would also be a part of this. We would be keen to further work with industry to develop capabilities and initiatives in this area.
IDA Initiatives In Coming Year
22. Let me next share with you some of our other focal areas and initiatives for the coming year. One of these is that of encouraging the development and adoption of Next Generation services.
23. Our Next Gen Nationwide Broadband Network is a key strategic enabler of such services. It has already been rolled out to more than 20% of homes and businesses in Singapore at the end of January 2010 and is on track to be deployed to 60% of Singapore by the end of this year, and 95% by the middle of 2012.
24. The Next Gen NBN offers opportunities for the development of innovative products and services for consumers as well as enterprises. The Next Gen Services Innovation Programme was launched to catalyst the development of innovative products and services. Our first call for proposal through the Next Gen Services Innovation Programme received more than a dozen proposals, and we expect to see services deployed in the first half of the year. The second call for proposal will be launched sometime later this year.
25. Interactive IPTV will be a major application, as has been seen in countries that have deployed high-speed broadband networks, something IDA and MDA are facilitating through our Next Gen Interactive Multimedia Services or NIMS programme. Last month, IDA organized an IPTV Forum, which saw more than 200 participants representing regulators, international agencies, standards bodies and industry. This forum offered opportunities to gain a deeper understanding of the development of IPTV standards globally. A NIMS panel has also being formed to recommend the appropriate IPTV standards that can best meet the functional requirements for a NIMS common featured set-top box. The selected standard will subsequently form the basis of the reference guidelines for the NIMS common featured set-top box that will be published by IDA and MDA.
26. IDA encourages potential RSPs, to develop and deploy Next Generation services on our Next Gen NBN. We have held a series of talks called Lighthouse to address the needs of potential RSPs, which saw very good response. We will therefore be organising a second Lighthouse series later this year. We will also be holding a series of Beacon talks, aimed at the end users from government, enterprises and consumers to highlight the benefits and possibilities of Next Gen services.
27. With that same goal in mind, IDA will be establishing an Infocomm Experience Centre in the middle of this year for the public and businesses to have exciting hands-on experience of the many possible Next Gen services that can be enjoyed through the Next Gen NBN. This Centre would be a good platform for RSPs to showcase their services and offerings to the high traffic of visitors there.
28. On the wireless side, we doubled the speed for the free Wireless@SG service to 1Mbps last September, and introduced several enhancements to the programme a few weeks ago. Users can now seamlessly and automatically login to the network to access media-rich and interactive websites as well as use bandwidth-intensive applications like video streaming. All these would encourage enterprises to innovate and create new services that leverage on the Wireless@SG network. These could include location-based services, cashless payment systems, facility monitoring and digital signage.
29. In line with IDA's efforts to promote Singapore as a major infocomm hub for the region, the Singapore Internet Exchange, or SGIX for short, will be established as a neutral Internet exchange, offering an efficient central point of Internet traffic exchange for domestic and international telecoms carriers, ISPs, and content providers. As a neutral exchange, it will offer its members interconnection services on a fair and non-discriminatory basis. As bandwidth-intensive applications become prevalent, the SGIX will allow Internet users faster access to such services with efficient network connectivity, and encourage content hosting and traffic exchange. SGIX was incorporated last September and is slated to be operational by the middle of 2010.
30. As the use of infocomm technology becomes more pervasive, the potential impact of cyber threats becomes greater. We are currently implementing the Infocomm Security Masterplan 2 or MP2 for short, the second five-year roadmap which aims to enhance the resilience of our economy against cyber attacks, and strengthen Singapore's position as a strategic and secure location for various economic activities. MP2 will see the public, private and people sectors working even more closely together to secure Singapore's cyber space.
31. Today, online services are becoming more widely proliferated, such as those from government, healthcare, banking & finance which provide access to sensitive information like financial and medical records. User IDs and passwords alone are no longer sufficient to protect consumers against unauthorised access of such sensitive information. While more Service Providers are turning to strong authentication, their individual implementations may incur higher costs and duplication of effort. IDA, together with our partner agencies, is working towards establishing the National Authentication Framework. The NAF will be a common platform that can provide cost-effective strong authentication services through demand aggregation, and achieve pervasive adoption of strong authentication by public-facing online services. The demand for NAF is expected to grow in tandem with the rollout of more high-value online services.
32. IDA will continue to embark on sectoral transformation programmes, working with our agencies and companies in the respective sectors. For example, in the education arena, IDA is working with MOE on the Edvantage Programme to prototype and develop new applications in education, whether in the areas of collaborative learning tools, class assessments, mobile learning or language tools.
33. By establishing strategic sectoral platforms and ecosystems to enable business collaboration, integrate processes and value chains across enterprises, we hope to facilitate business transformation and innovation.
34. Some examples you would be familiar with, are the Contactless Point-of-Sale Terminals initiative under the Next Gen e-Payment Programme; the i-Singapore initiative to bring together data from the public, private and people sectors, and leverage advances in geospatial data technology to create innovative services for the public; the TradeXchange® initiative to provide a neutral and secure IT platform to enable seamless exchange of information within the trade and logistics community. CFCs for these initiatives were awarded recently, and the various services under them will be implemented in the coming year. We look forward to developing other sectoral platforms in co-operation with the different sectors that will generate value for both businesses and end users.
35. Next, our efforts to develop a globally competitive infocomm industry as an engine of growth for our economy, can be framed along the lines of being an innovation catalyst, a market connector, and a talent bridge.
36. First, innovation catalyst. We want to encourage innovation and pilots in the various user sectors. The government is a large lead infocomm user. There are opportunities for the government to pilot new innovative solutions proposed by industry and push the envelope in our government services to employee and citizens, and for infocomm companies to test-bed cutting edge solutions to meet business needs expressed by our agencies. This is particularly so, as we move from the current iGov 2010 Masterplan to formulating our next eGov Masterplan.
37. We have more than 160,000 SMEs, accounting for half of our GDP, SMEs are therefore a critical driver of Singapore economy. It is thus important that our SMEs remain competitive and thrive. The Infocomm@SME Programme, to encourage SMEs to adopt infocomm for productivity, competitiveness and market reach, has benefitted more than 3,000 SMEs over the past two years. The programme will be enhanced, to address the different infocomm adoption needs of the SMEs and promote the use of quick to implement and "Plug and Play" solutions by SMEs to improve their business operations. SMEs can look forward to leveraging emerging technologies such as mobile and software-as-a-service applications to get started easily and minimise the cost of adoption.
38. Besides supporting individual SME adoption efforts, IDA will be working with other government agencies and industry associations, including SiTF, to support sectoral level transformation. An example would be the MOE, IDA and SiTF collaboration on matching supply with demand with the pre-school sector for appropriate infocomm solutions to improve the schools' operations and facilitate teaching and learning. This had led to at least $900,000 worth of potential IT spending for the Infocomm sector.
39. Another big user of infocomm is the global MNCs. There are more than 7,000 MNCs in Singapore today, and many of them have set up their global or regional shared IT services centres in Singapore. Some recent additions include the UOB Regional CIO Office and Operations Centre, Crédit Agricole Corporate and Investment Bank's Regional IT Development Hub7, and Salesforce.com International Data Centre. Singapore can be developed as a top-of-the-mind trusted hub for global IT activities with high value and mission-critical capabilities delivered out of here, bringing spillover benefits as well as more business opportunities for the infocomm companies in Singapore.
40. With Singapore's new Next Gen NBN, we are also in a position to be an innovation test bed for digital media companies to develop new business models or re-purpose content and services for international markets. Under the Digital Marketplace initiative to develop new innovations to reach digital consumers, IDA recently facilitated collaboration among several international players in the digital media space, namely BayTSP, Mediacorp, and Oracle, to develop an accelerator project to showcase the world's first content fingerprinting and online content authentication system in Singapore at Asia Television Forum 2009. This project demonstrated how content owners and advertisers can leverage business and consumer analytics to better apply and monetise online contextual advertising.
41. It is also essential that we continue to provide a conducive environment for infocomm start-ups here to thrive. We want to help them connect with experienced global entrepreneurs and investors, thus increasing the innovation level and vibrancy of the ecosystem. Attracting foreign innovative start-ups to set up their engineering centres in Singapore through our iCentre programme contributes to that. Within the last year alone, IDA has anchored the Asia HQ and engineering centres of 26 foreign start-ups from the U.S, Israel, Sweden, Germany, Finland and China, bringing in more than S$50m of investments and contributing to more than 260 high-value, innovation-driven engineering jobs in Singapore. The fact that high growth start-ups from developed countries, having high venture capital investments, choose to base their high value activities here, bodes well for Singapore's growth as an innovation hub.
42. Next, Market Connector - helping to connect our companies to the market, whether locally or internationally. Sensing the market situation and demand is a part of that, and IDA is constantly keeping in touch with industry in that regard, whether through the formal annual surveys or more informal gathering of feedback, which we find valuable. Identifying emerging technology and business trends and the imperatives and opportunities they generate is also important, especially in a fast changing industry and environment like ours.
43. Industry partnership programmes like iLIUP and ODP are part of our Market Connector efforts. Last year, new MNC partners joined the programmes, such as Hitachi Data Systems that will help to develop iLEs in providing high value-added IT services with data storage and management technologies, and Savvis, to help iLEs develop Software-as-a-Service offerings. One successful partnership is that between Avaya and one of our local enterprises, NxGen. The partnership helped NxGen, which focuses on enterprise voice, contact centre solutions and business process outsourcing, to take root at home and expand overseas. Through Avaya's assistance in training, technical support and business leads, the young company reaped $10 million in sales in 2008 and has enjoyed double-digit growth yearly since it first started. I look forward to many more of such successful partnerships in the coming year. Since the beginning of FY09, the 16 MNCs in the programmes have helped their iLE partners develop more than 30 new or enhanced products and solutions, trained more than 190 infocomm professionals and generated more than $32m in revenue. Moving forward, IDA will renew the focus of iLIUP and ODP to drive market development, capitalising on the economic recovery in overseas markets with growth potential.
44. Generating better awareness and mindshare of made-by-Singapore solutions through thought leadership speaking engagements, G2G fora and our interactions with government and business leaders also helps to connect our companies to markets. Companies which are in the "traditional" markets of China and the Middle East continue to gain traction and enjoy decent growth in export revenues in these markets. The creation of IDA International has also provided us market connections to countries as far as the Caribbean, Africa and South America, which are interested to adopt and adapt Singapore's experience in using ICT solutions to provide world-class public services. The Global Business Development Centre of Excellence, or GBD COE for short, a tripartite effort by IDA, IDA International and IE Singapore, will continue to help the Singapore infocomm industry to scale up global business development and increase business opportunities in overseas markets. We will step up the GDB COE activities in the coming year: to develop more promising new markets, provide advisory on in-market knowledge and possible business structure models, and enable more effective go-to-market activities.
45. To create effective market connections in the e-Government arena, we hosted a very successful iGov Global Exchange during last year's imbX, which saw about 600 senior government officials, CIOs and business leaders from 40 countries gathered to share ideas and best practices on e-Government. Continuing the momentum, we will be organising another such gathering during the coming imbX. The iGov Global Forum from 14 to 15 June will focus on the theme "e-Government: The Next Quantum Leap". Besides the main forum, site visits will be organised to showcase our industry's infocomm solutions in some of our agencies.
46. Third, Talent Bridge - attracting and grooming our infocomm talent, and developing our infocomm professionals. I won't elaborate on this area of manpower development this morning, but I will just say that IDA will continue to focus on attracting a pipeline of talent to the infocomm sector. As part of our efforts to attract some of the best students to pursue a career in the infocomm sector, we awarded 26 National Infocomm Scholarships and 20 Integrated Infocomm Scholarships in 2009. In addition, last year, we also added 93 new participants to ELITe, our talent development programme for good university undergraduates to acquire practical industry exposure. Student participation in our schools at all levels has also been enthusiastic. The number of Infocomm Clubs in our schools has increased, from 150 clubs with 7,500 members in 2008 to 251 with 10,500 members today.
47. From our recent annual Infocomm Manpower Survey, we see that there are 140,800 infocomm professionals employed in Singapore, an increase of 1.3% over the previous year. The strongest areas of growth include the areas of software development, Digital Media and Animation, and R&D. As we move to a higher plane in our industry, it is necessary to develop our talent in key areas of demand, such as Business Analytics, Cloud Computing, infocomm security, and Green ICT. Our recent iLEAD initiative to build a pipeline of infocomm experts in high-end, niche areas will be helpful in that regard. We would also be interested in seeing how we can work with industry and our professional organizations to better identify qualified and experienced infocomm professionals to meet the needs of our industry.
Upcoming Events
48. Before I close, I would like to highlight a few events taking place in the near future that we would welcome industry's active participation in.
49. As businesses rapidly leverage the Internet to compete globally, competition for global resources such as public IP addresses is also escalating. IDA is working with industry on several IPv6 transition programmes to ensure that our Singapore enterprises are ready to continue growing their Internet-based businesses. We have formed an industry working committee to look at IPv6 technologies, and will also be conducting a national IPv6 readiness survey.
50. This year, IDA and SiTF will once again organize the National Infocomm Awards, the industry's highest accolade for infocomm innovation in Singapore, the 5th in the series since it started in 2001. There are 4 categories of awards for NIA 2010. Three of them are for the Most Innovative Use of Infocomm Technology, in the Public sector, Private sector (General) and Private sector (SMEs), while the fourth category seeks to recognise the Most Innovative Infocomm Product or Service. We welcome all organisations, big or small, to take part in NIA 2010. Online nominations will start today and end in early June. The NIA gala dinner, where the award winners are announced and celebrated, will be held in early October, so do keep a lookout for it.
51. Finally, on 11 May, we will be doing the 2010 Industry Briefing, to highlight some of the procurement plans and pipeline infocomm projects in the public sector. This is always a very well attended event, and I'm sure I will see many of you there.
Closing Remarks
52. So till we meet again, I take this opportunity to thank all of you for your support and participation in IDA's various efforts to develop and grow the infocomm industry in the past year, and I wish you and your companies all the best, as we move from a challenging year of recession to one of exciting opportunities ahead.
Notes:
1 According to the IMF's "World Economic Outlook", published on 26 Jan 2010. www.imf.org/external/pubs/ft/survey/so/2010/NEW012610B.htm
2 According to Gartner's "IT Spending 2010" released in Oct 2009.
3 According to MTI's press release "MTI Revises 2010 Growth Forecast to 4.5 to 6.5 Per Cent" and "Economic Survey of Singapore 2009" dated 19 Feb 2010.
4 Based on DOS' estimates for both 2008 and Q1-Q3 2009, IDA's infocomm cluster contributed 7.1% to GDP.
5 Other sectors that showed positive growth are construction and business services.
6 According to MTI's "Economic Survey of Singapore 2009" dated 19 Feb 2010.
7 Credit Agricole Corporate and Investment Bank was originally named Calyon.
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