There are, however, new developments which present interesting challenges for the industry. Speaking at the recent ASOCIO ICT Summit 2007, Dr Vivian Balakrishnan, Minister for Community Development, Youth and Sports and Second Minister for Information, Communications and the Arts, highlighted three trends affecting infocomm - the commoditisation of connectivity, the standardisation of services, and increasing value creation from innovation.

With the commoditisation of connectivity and the standardisation of services, the local infocomm industry will need to ask where it should be positioning itself in the value chain, he said.

Mr Tan: Local companies are sandwiched between MNCs and low-cost foreign players.

Mr Tan Tong Hai, President and Chief Executive Officer (CEO), Singapore Computer Systems (SCS) agrees. “Singapore’s IT landscape remains highly competitive. Local infocomm companies are sandwiched between MNC IT players and low-cost foreign IT players from India and China. This leads to the thinning of the margins made by local infocomm companies,” he said.

Building capabilities

In the face of these challenges, the Singapore Government will continue to lead efforts to grow the industry. “We want to help companies to increase their capability through programmes such as iLIUP (Infocomm Local Industry Upgrading Programme) and ODP (Overseas Development Programme),” said Mr Leong Keng Thai, Deputy Chief Executive/Director-General Telecoms, Infocomm Development Authority of Singapore (IDA). “The idea is to partner local companies with major MNCs so that they can gain market access and increase their enterprise capability.”

Another key thrust is to increase marketing and branding for Singapore companies. “There is potential for the Singapore brand to be marketed worldwide,” said Mr Leong. In 2006, Singapore’s infocomm export market accounted for some S$29 billion in revenue, compared to S$22 billion in 2005. The aim for Singapore is to be a world leader in adding value to both the economy and society by harnessing infocomm: to double the amount of value-add to the local infocomm industry to S$26 billion and triple the amount of local infocomm export revenue to S$60 billion.

Blazing the trail

As part of these efforts, IDA has inked collaboration agreements with its counterparts in other countries, and led trade missions to regions such as the Middle East and Eastern Europe to explore new opportunities for local infocomm players.

In November 2007, for example, a delegation visited Oman and Qatar to explore opportunities in the areas of infrastructure, education, trade and logistics, and healthcare.

The visit followed the signing of a Memorandum of Understanding (MOU) between Singapore and Qatar in October, and between Singapore and Oman in November, to enhance collaboration in infocomm and communications technologies (ICT) between the states. The MOUs covered areas such as telecommunications, e-health, e-education, e-commerce and e-tourism.

Earlier this year, IDA also led a 12-company contingent to the Gulf Information Technology Exhibition (GITEX) 2007, the region’s premier ICT event in Dubai. And, together with the Singapore Business Federation, it led a business delegation to Hungary and Poland to help local infocomm companies explore
e-Government opportunities in Central and Eastern Europe.

Exporting e-Government expertise

“The future of Singapore's infocomm industry will dependent largely on the ability of local companies to capitalise on opportunities in the international front especially since Singapore is well placed in international benchmarks,” said Mr Pek Yew Chai, Chairman of the Singapore infocomm Technology Federation (SiTF).

Singapore ranked first in Accenture's e-Government 2007 study, and first as well in the World Economic Forum's Global IT Report in the area of Government Usage and Government Readiness.

"There is a vast potential for markets to jumpstart their e-Government journey in much greater speed by leveraging the rich learning curve of the Singapore experience,” said Dr Foong Wai Keong, President and CEO of Ecquaria. The company is working with Qatar’s Supreme Council of Information and Communications Technology (ictQATAR) to develop the Qatar Service Platform, a single integrated e-Goverment platform to help fast-track the Qatar government’s aggressive drive towards fifth generation
e-Government initiatives.

The Singapore infocomm Technology Federation holds an annual Business Outlook Forum to provide the industry with insights into emerging ICT trends.

Other niche areas

Beyond e-Government, many Singapore infocomm companies are also finding their own niche areas in the market. Privylink, for example, offers solutions in the area of e-security and e-payment. According to the company’s business development consultant Mr Billy Au, growth prospects are “very promising” in the data security arena for fixed and mobile channels.

Equally promising is the area of data mining. “The growth for 2008 should be good for our CRM (customer relationship management) solution and fraud detection solution,” said Mr William Foo, technical director of Integral Solutions. “Our overseas contracts are growing due to our specialty in producing effective data mining solutions where there is a need for specialised skill sets and domain knowledge.”

Gaming is also a high growth area. According to Mr Addison Kang, CEO of Cherry Credits, the gaming industry is worth billions of dollars and counting. “Cherry Credits’ performance within the last six months has been outstanding…I’m certain our growth (forward) will be exponential. Growth areas are the evolvement and creation of new content and new levels of technology to support game play.”

“We’ve … moved into an era in which individuals, or small groups of individuals, small companies or SMEs, with a bright idea, capable of developing that bright idea into a marketable product, can suddenly see explosive growth in value,” said Dr Balakrishnan.

Role of larger companies

Like smaller companies, larger players have also realised that focus pays. SCS, for example, attributes the turnaround in its 2007 results partly to its focus on business continuity and disaster recovery as a core competency.

“With the tightening of corporate governance and introduction of more stringent audit requirements, business continuity/disaster recovery has evolved from a ‘good to have’ to a 'must have',” said its CEO Mr Tan.

Dr Balakrishan also points out that larger, more established companies play another key regional and global role. Eventually when it comes to market reach, when it comes to roll-out, when it comes to system integration, when it comes to servicing, not at the level of the small market, but servicing at a global level, there is a need for large enterprises, he said.

Onward to 2008

Mr Lim: The next two to three years should be good, barring unforeseen disasters and regional unrest.

Looking ahead, the next two to three years should be good, with continued demand and growth barring unforeseen disasters and regional unrest, said Mr Stephen Lim, CEO of SQLView. He acknowledges that selling to overseas customers is “obviously more challenging” but shrugs, “What to do? The Singapore market is so small.”

Mr Pek of SiTF, too, is confident that the local infocomm sector will continue its growth in 2008. “With the efforts of the industry and multiple agencies, there is little doubt that we will continue to be a hot bed for ICT information exchange and innovation because of our infrastructure and our talented resources, and our ability to attract,” he said. “The future does indeed look bright."