Malaysian telcos need to invest in IoT: Frost

• Opportunity for companies to diversify their business
• Telcos need to invest in building IoT partner ecosystem

THE information and communication technologies (ICT) landscape in Malaysia is nearing maturity and revenue growth from core sectors is slowing down, however the advent of the Internet of Things (IoT) is giving rise to opportunities in the form of new business services, according to Frost & Sullivan.
 
Hence, communication service providers (CSPs) must leverage their core competencies to capture horizontal revenue streams stemming from the IoT, such as managed services and security, and cloud computing and storage, the analyst firm said in a statement.

According to its Internet of Things report, the IoT market in Asia Pacific is expected grow at a compound annual growth rate of 35.1% between 2014 and 2020.

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In Malaysia, the deployment of IoT will gain traction in the transportation, logistics and connected consumer sectors such as wearables, connected homes, and home automation, Frost & Sullivan said.
 
“Readily accessible and cost-effective storage, computing and programmable networking systems are fuelling novel business applications and IT delivery models, thus facilitating a distributed intelligent network,” said Frost & Sullivan ICT industry manager Serene Chan.

“Embedded systems will provide the crucial link between cloud solutions and fully autonomous end devices, speeding up the transition to the IoT,” she added.

Finding value in the vast array of unstructured machine and connected device data available will be critical to support IoT-based services for a variety of industries, Frost & Sullivan said in its statement.
 
Currently, less than 1% of the data captured by sensors is used for analytics and optimisation, it added.
 
In addition, Malaysian CSPs struggle to offer IoT services due to market fragmentation as well as security and privacy concerns.
 
These challenges are organisational rather than technical in nature, as CSPs still focus on selling connectivity instead of solutions and services.

“Entering into the IoT space requires industry players to acquire capabilities beyond their core functions. The CSPs in Malaysia must collaborate with a variety of partners to deliver relevant end-to-end services in specific industries,” Chan argued.
 
Thus, evolving from a cost-optimised connectivity provider to an IoT service provider will drive business objectives and enable innovations in the changing ICT domain, she added.

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