Southeast Asia’s telcos embrace transformation for $330b digital economy by 2025

Telcom and ICT experts say collaborations are hastening digital infrastructure growth.

Southeast Asia’s digital economy is poised to reach an impressive $330b by 2025, according to industry experts. However, navigating economic challenges and ensuring efficient strategies will be crucial to harness this growth potential.

In a recent interview with Asian Telecom magazine, Abhishek Srivastava, head of TIME Practice Southeast Asia, and Lars Riegel, head of Digital Infrastructure at Arthur D. Little, see a shift towards increased collaboration and investment in building the necessary infrastructure.

Srivastava highlighted the changes expected in asset ownership structures. “We expect significant reconfiguration to happen in the telco or digital infrastructure, with power companies and fiber companies taking over ownership or sharing ownership compared to incumbents holding the entire value chain,” he said.

Riegel acknowledged that the trend on increased collaboration and investment fuels the growth of digital infrastructure and that there are successful models from other regions that can be adopted.

“Incumbent operators and challenger operators inviting financial investors to build networks together is proving to be a win-win scenario. This approach benefits the operators, financial investors, and consumers alike, accelerating the digital sector’s growth in the APAC (Asia Pacific) region,” Riegel explained.

As the industry progresses, Srivastava is watchful of the challenge to balance existing systems with adopting new technologies and business models.

In this scenario, he said: “We expect more joint ventures and partnerships to evolve with respect to newer technologies. AI (artificial intelligence) is set to play a significant role in areas like customer experience, network management, and even product definition.”

Meanwhile, Riegel said the state of Southeast Asia’s fiber networks, 5G networks, and hyperscale data centers highlights the need for the region to catch up. “Financial investors are being invited to invest heavily in the region, boosting the deployment of these technologies and ultimately benefiting the economy and consumer experience,” he said.

In response to changing consumer behaviors and market needs, new business models are emerging in the telecom sector.

“We see bundling of services gaining traction, with fixed-mobile convergence playing out in economies like Indonesia. Monetising 5G through advanced enterprise use cases is also expected to shape the region's telecom landscape,” Srivastava said, speaking of Southeast Asia.

Riegel expounded on the global perspective, emphasising the adoption of innovative asset structures and partnerships.

“Hyperscale data centers are being developed across countries, and financial investors are partnering with operators to enhance fiber networks and tower infrastructure,” he said.

These developments align with successful models seen in other regions, signifying a promising path for the region’s telecom industry.

For more updates and news from the telecommunications industry, visit asiantelecom.com.