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How the Rise of Cloud Technology in SEA Benefits Businesses

How the Rise of Cloud Technology in SEA Benefits Businesses

What was once just a buzzword in boardrooms is now a staple in almost every business conversation — cloud technology has well and truly arrived with its full suite of benefits.

The days when businesses would store all their critical data and applications on physical servers in-house are essentially gone.

Now, organisations are increasingly turning to cloud-based solutions to power their operations, and it’s not just for the security and flexibility that they offer.

The cloud has become a major game-changer in the way businesses operate, and this is especially true in Southeast Asia.

The region has become a hotbed for cloud adoption with rapid economic growth and increased connectivity. In fact, the cloud computing services market in Southeast Asia is expected to grow to US$40.32 billion by 2025.

So, what is driving this growth, and what does it mean for businesses in Southeast Asia? Let’s take a closer look!

COVID-19 Has Boosted the Adoption of Cloud Technology in Southeast Asia

Prior to the pandemic, the shift to the cloud was slow — there was no rush towards a new technology that was both a basic shift in operations and a relatively uncommon concept in practice outside of big tech.

However, with the onset of COVID-19, many Southeast Asian businesses found themselves with remote workforces needing to stay productive outside of an on-premises data centre.

The cloud provided a way for these businesses to maintain continuity and keep their employees connected, making the pandemic a major catalyst for the adoption of cloud technology in Southeast Asia.

Singapore is leading the cloud-based charge, with almost 9 out of 10 IT decision makers saying their organisations are already using cloud-based IT solutions in their operations.

This quick adaptation to an entirely new infrastructure proves the resiliency of businesses in Southeast Asia. And with the cloud now an integral part of their operations, they are better prepared to weather any future disruptions.

What Are the Benefits of Cloud Technology for Businesses in Southeast Asia?

Why does it make perfect sense for companies in the SEA region to implement cloud technology in their business operations?

We explore a few reasons:

Cloud Technology Helps Businesses in Southeast Asia Stay Competitive

Southeast Asia is a highly competitive region where businesses are constantly battling for market share. The ones that succeed are agile and able to rapidly adapt to changes in the market.

The cloud provides this agility. Of its multiple models, cloud technology’s pay-as-you-go model might be the most appealing to new adopters as firms only need to purchase the resources they need when needed.

This scalability is crucial for organisations that are growing quickly or experience spikes in demand.

Additionally, it  helps businesses to save on capital expenditure.

With traditional on-premises infrastructure, businesses would need to make a large upfront investment in hardware and software that may become obsolete in a few years.

This not only helps to free up cash flow but also allows corporations to invest their resources in other areas of the business.

Related Resource (Podcast): Episode 1: IT/Technology Industry in Singapore

The Cloud Contributes to Digital Inclusivity and Sustainable Growth in Southeast Asia

Aside from its direct benefits to businesses, cloud computing also has a positive impact on society at large.

By providing the ability to cast a wider net on talent, the cloud allows for digital inclusivity in employment across the region.

24% of businesses say leveraging a diverse and inclusive workforce is the main part of their growth strategy, and the cloud certainly facilitates this.

Additionally, the cloud is also helping to close the digital divide in Southeast Asia.

With its pay-as-you-go pricing model, the cloud makes it easier for small businesses and startups to get started without a large upfront investment. This allows them to compete with larger businesses on a level playing field.

Related Read: Preparing for the Open Finance Framework

What Are the Challenges to Cloud Technology Adoption?

As it stands, there are two main obstacles to widespread cloud adoption in Southeast Asia — a shortage of local talent, and data residency laws.

In terms of the local talent crunch, the lack of qualified cloud engineers is a major stumbling block for businesses looking to adopt cloud technologies.

The reality is that the talent pool just isn’t growing as fast as the demand for cloud services, and this is seen as the 2nd-most disruptive factor for companies in Southeast Asia.

Thankfully, public and private institutions (as well as partnerships between the two) are working to build local cloud talent.

Singapore for example has the Singapore 5G & Telecoms Academy which aims to build talent within 5G, cloud, and other emerging technologies.

The Academy has already equipped over 3,000 Singaporeans with the relevant skills for industry 4.0.

As for data residency laws, it all comes down to data security — that is to say, laws that require companies to keep data about their citizens on servers located in their resident country.

With an eye toward more stringent privacy laws and data encryption, many organisations might see the cloud as a way to inadvertently violate these new data-sharing laws.

This is a genuine concern — after all, data is the lifeblood of any business, and entrusting it to a third-party provider can be a daunting proposition.

That being said, with more and more cloud service providers investing in data centres within Southeast Asia, this obstacle is slowly being removed.

Looking Ahead at the Cloud Beyond

The cloud is inevitable — there’s no way around it.

The advantages it provides are simply too great for businesses to ignore, and as the talent pool and infrastructure continue to develop, we can only expect its adoption rate to increase.

In a few years’ time, cloud computing will be an integral part of doing business in Southeast Asia, and those who embrace it early will be well-positioned for success.

FAQs on Cloud Technology

  • Cloud technology is a term that refers to the use of remote servers to store, manage, and process data.
  • Cloud technology has revolutionised the way businesses operate, making it faster and easier for them to access the data and applications they need.Here are some benefits offered:
    • Increased efficiency
    • Increased flexibility and freedom for employees
    • Cost savings
    • Improved collaboration
  • Some examples are:
    • Cloud storage
    • Cloud computing
    • Cloud-based software

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About the Author

InCorp Content Team

InCorp's content team includes talented copywriters from our regional group and globally. We contribute informative, thought leadership, and market-trending articles to guide aspiring business entrepreneurs to a higher level across the Asia-Pacific region.

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