Asia told to invest more in telecom infrastructure

Intel Capital yesterday told the World Economic Forum on East Asia that this year it would invest US$17 million (Bt540 million) in two Southeast Asian companies.
“We have been investing in this region since 1999 with more than $95 million in over 12 companies,” said Sudheer Kuppam, managing director for Asia-Pacific of Intel Capital, Intel’s global investment and mergers and acquisitions arm.
The investment in Reebonz.com in Singapore and Vietnam Communication Corporation in Vietnam is part of a strategy to drive Internet users and usage in Southeast Asia, which is one of the key focuses of Intel.
Besides holding not over 20 per cent of each company, Intel will support them in various areas with programs, business consulting, technology and its connections and channels around the world.
Intel Capital sees Southeast Asia as one of the world’s fastest-growing markets for the hi-tech industry with robust economic growth and a rising middle class.
For Asia, Intel Capital usually invests about 25 per cent of its $400-million annual budget.
Intel Capital invests in a broad range of companies across vertical sectors including hardware, software and services, targeting the enterprise, mobility, health, consumer-Internet, digital media, semiconductor manufacturing and clean-tech markets.
Uday Marty, director of Southeast Asia for Intel Semiconductors (US), said his firm is eyeing to invest more in Asia and Asean, and Thailand and Vietnam are two of the high-potential markets for the firm’s expansion in the future.
The focus would be on value-added products. Although severe floods hit Thailand last year, its fast recovery has been highly appreciated and will help draw more investment.
However, political instability may hit the confidence of investors. The development of intellectual property rights is also favoured to assure investors.
To enhance regional capability to draw more investment in the telecom industry, Asean and Thailand should emphasise education and broadband development.
The curriculum should be modernised.
Gregory Bryant, vice president and general manager of Asia-Pacific for Intel Semiconductor, who has been in this role for five months, said Intel will focus on four main businesses – ultrabooks, consumer notebooks, data centres and emerging products.
“We still have confidence in Thailand as one of the key markets for us in Asia. We aim to have strong and solid double-digit growth in Asia for this year,” he said.
The priority for Intel in Thailand is to assist the government in bridging the digital divide by increasing broadband Internet penetration.
“In Thailand, there are 19 million households. Around 15 million households have not yet been connected to the Internet. The challenge is how to help these people to access the Internet,” he said.
According to Dun & Bradstreet, every 10-percentage-point increase in the broadband penetration rate helps increase GDP growth by 1.38 percentage points.
“Increasing broadband Internet penetration will help Asian countries increase their economies and increase their competitiveness,” he said.
Alcatel-Lucent, a leading global innovator in the field of networking and communications technology, pointed out that Asia needs to invest $1.1 trillion in its telecom infrastructure to compete in the digital economy.
Rajeev Singh-Molares, president of Asia-Pacific, said that although mobile subscribers have been surging in the past five years, 25 per cent of Asians still live without basic mobile services.
The region, especially Thailand, should develop its telecom architecture so that more investment will come to the region and the country. The development of the telecom industry is one of the basic fundamentals that concern investors.
The firm is considering investing more in the region, focusing on Thailand and Vietnam. It will increase investment in research and development and production after setting up a service base in Thailand.
However, Thailand’s competitiveness ranking has slipped largely this year. The country needs huge investment in ICT to lift its competitiveness. Other Asean countries have done better in terms of competitiveness development.
 The firm has high expectations of the Thai government’s “Smart Thailand Strategy” to invest $2.6 billion on a digital platform with the aim to boost Internet penetration from 33 per cent today to 95 per cent by 2020, he added.