The channel has been credited with delivering another year of solid growth for Microsoft in Singapore, driven by the addition of new partners and customers.
That’s according to Kevin Wo - managing director of Singapore at Microsoft - when addressing a jam-packed channel audience during Microsoft Partner Exchange 2019 in Singapore.
“We have doubled our market growth, and that could not be achieved without a strong contribution from our partners,” said Wo, referencing that partners currently contribute 95 per cent of Microsoft’s commercial revenue.
"Our partners play a very important role in driving our growth at Microsoft. We are a partner-led company and in being a partner-led company, our partners are essentially our growth engine.
"Look at the new partnerships we are creating and look at the innovation we are bringing to our customers through our ecosystem. IP co-sell deals close x3 faster, projects are x6 larger and Azure consumption is x8 higher. This is the power of co-sell in Singapore."
In looking ahead however, Wo said the channel opportunity centres around organisations yet to transform through technology.
“By 2030, technology companies are going to contribute 10 per cent of the global GDP, that equates to about $40 trillion, creating lots of opportunity in the market,” he said. “For the channel, the real opportunity is focusing on the 90 per cent of non-technology companies, through driving digital transformation at a customer level.
“There’s opportunities for partners to help customers leverage digital technologies, become a software company and transform business models.”
In assessing the evolving technology landscape, Wo acknowledged a “huge shift” towards the intelligent cloud and the intelligent edge, billed as key areas of focus for channel partners in 2019 and beyond.
“The world is moving towards multi-sense and multi-touch in which every interaction around computers and computing is no longer device-first, it’s going to be very human-centric first,” Wo added. “Artificial intelligence [AI] will be used to improve experiences and this will transform the way a company works.
“Success will be orchestrated between the cloud and the edge and we will see more use cases come forward which tap into the potential of 5G and edge computing to deliver and drive intelligence at the forefront of customer transformation.”
Race to 5G
According to findings from AT Kearney, 20 per cent more revenue could be added to enterprise business revenue in ASEAN by 2025, as the race for 5G gathers pace. Indonesia is expected to capture the biggest share, followed closely by Malaysia, Singapore and Thailand.
To deliver such value, a further $10 billion is expected to be “poured in” by ASEAN telecom operators into the region’s 5G infrastructure within the next six years.
“On the enterprise side, bundling enhanced connectivity with solutions and applications will be essential to helping customers understand, implement, and scale up value-enhancing use cases,” the report stated.
“Operators will need to build new capabilities and create partnerships to support this opportunity with solutions and applications beyond connectivity, and they will have to contend with a new set of competitors that provide private networks to enterprises.
“With ongoing uncertainty about the full capabilities and widespread availability of 5G, many enterprises may lean toward alternate technologies, such as LTE, Wi-Fi 6, and various Internet of Things (IoT) networks, that can not only complement but also compete with 5G.”
In recognition of increased market interest and knowledge regarding 5G - spanning consumer, enterprise and telecommunications markets - Wo said that China alone has invested $150 billion in the 5G roll-out during the past 12 months, highlighting a sizeable market shift in Asia Pacific.
“All of this is important when you think about moving technology forward with your customers and how as the channel, you are going to tackle 5G and accelerate digital transformation journeys,” Wo explained.
“Think about 5G, think about the cloud and think about intelligent network-fabric - how will you create use cases to solve the most complex problems that our customers are facing today?”
Data / AI
Delving deeper into technology trends, Wo said 90 per cent of data has been created in the last two years, with 73 per cent of this currently “not being analysed”.
“Customers must start to take advantage of data and start to innovate and analyse the information they have,” he said. “This presents lots of opportunities for partners - think about how you can help customers leverage the data assets they have and turn this into the new oil.”
Meanwhile, and according to IDC research - commissioned by Microsoft - AI is expected allow the rate of innovation and employee productivity improvements in Asia Pacific to nearly double (x1.9 times) by 2021.
But despite 80 per cent of businesses acknowledging that AI is “instrumental” in creating competitiveness, only 41 per cent of organisations in the region have embarked on AI journeys. Such organisations expect AI to increase competitiveness 100 per cent within the next three years.
“Today, every company is a software company, and increasingly, every interaction is digital,” said Ralph Haupter, president of Asia, Microsoft, speaking at the time of the research launch in February 2019. “To be successful in this new world, organisations need to be a fast adopter of best-in-class technology; and secondly, they need to build their own unique digital capabilities.
“AI is the defining technology of our time that significantly accelerates business transformation, enables innovation, boosts employee productivity, and ensures further growth. Economies and businesses that have yet to embark on their AI journey run a real risk of missing out on the competitive benefits that are enjoyed by leaders.”
For customers that have implemented AI initiatives, the top five business drivers to adopt the technology ranked as: better customer engagement (26 per cent); higher competitiveness (19 per cent); higher margins (18 per cent); accelerated innovation (15 per cent) and more productive employees (nine per cent).
“Last year, organisations that adopted AI saw tangible improvements in those areas in the range of 18 per cent to 26 per cent,” added Victor Lim, vice president of IDC. “They forecast further improvements of at least 1.8 times in the three-year horizon, with the biggest jump expected in accelerated innovation and competitiveness.”
Specific to the channel, and the Singapore market, Wo labelled AI as the “defining technology of our time”.
“We believe that all future technology breakthroughs that are coming ahead of us will have an AI component,” he said. “What can we do together to help our customers through this journey? What can we do together to take advantage of this opportunity in the market?”