NEWS: Challenging Year Ahead

PETALING JAYA: Growth for the Information and Communications Technology (ICT) industry will fall to its lowest in a decade next year, according to the Association of the Computer and Multimedia Industry of Malaysia (Pikom).

“We foresee organisations cutting down on ICT spending. Our forecast for next year will be 5%, in light of the global financial crisis,” Pikom chairman David Wong told In.Tech.

He added that the local ICT sector experienced a 7% growth this year and 10% in 2007.

“The last time the local ICT sector had a 5% growth rate was during the last financial crisis in 1997,” Wong said.

But it’s not all gloom and doom.

“We are still bullish on the outsourcing industry. With the economic slowdown, companies will be looking at ways to cut cost and outsourcing will be one way of doing this,” he said.

Wong even expects the outsourcing industry to create more jobs within the ICT industry.

“Unlike the manufacturing industry, the ICT industry will be creating jobs rather than losing jobs. We need more workers in the outsourcing industry.

Currently we have only 70,000 people working in outsourcing companies but we need 300,000 by 2012,” he said.

Pikom also expects the RM7bil stimulus package (announced on Nov 3) to cushion the overall drop in ICT investment next year.

“The Government has introduced several measures in its latest stimulus package to progressively stimulate the economy.

“We see the IT industry benefiting through lower fuel prices, which in return reduces cost of ICT companies doing business,” he said.

He added that the rollout of High Speed Broadband (HSBB) and WiMAX nationwide would spur the ICT industry on.

HSBB, which will be deployed by TM, promises surfing speeds up to 1Gbps (gigabit per second).

The Government signed an agreement with TM in a public/private partnership to build the RM11.3bil HSBB network in the country, in September. It was announced that the Government will fork out RM2.4bil for the venture (StarBiz, Sept 17).

As for telecommunications spending, Wong said that Digi.com Bhd has stated that 2009 will be its biggest investment year ever, with its 3G mobile broadband rollout.

From Pikom’s point of view, ICT will continue to be the key enabler or strategic tool for cost savings and productivity improvement during these challenging times.