Milestone year for MSC Malaysia InfoTech Companies

Revenue reaches RM15.36 billion and exports at RM3.736 billion

Kuala Lumpur, 15 August 2012 – MSC Malaysia’s best year ever in 2011 with over RM 30 billion in revenues was strongly driven by its Information Technology Cluster (InfoTech). The InfoTech Cluster emerged as the top revenue contributor to MSC Malaysia in 2011, representing 48% of the overall revenue amounting to RM15.36 billion, which was an increase of 22% from 2010.

The cluster’s contribution to GDP rose to RM 3.38 billion, which was an increase of 21% from the previous year. In the area of job creation, the cluster saw over 4,030 new jobs which represented 53% growth from 2010. This brought the total number of jobs created within the InfoTech Cluster to 37, 824 as of 2011 while R&D spending rose 3% from 2010 to RM998.09 million while exports recorded a decline of 2% from 2010 and stood at RM3.736 billion.
Datuk Badlisham Ghazali, Chief Executive Officer, Multimedia Development Corporation (MDeC) and Dinesh Nair, Director, Information Technology Industry Division at Multimedia Development Corporation (MDeC) at the InfoTech cluster update press conference.

Speaking at the press conference, Datuk Badlisham Ghazali, Multimedia Development Corporation’s (MDeC) Chief Executive Officer said, “We are very pleased with the latest performance of the InfoTech cluster as it is a reflection of the fact that our ICT sector has reached a level of maturity. Amidst the uncertain global macroeconomic scenario, our ICT companies exhibited resilience and adaptability in continually reinventing themselves to retain their appeal to clients”.

The key contributors to the cluster’s revenue were the following top five segments; Consumer Software, Security Telecom & Networking, Supply Chain Management (SCM), Operations and Manufacturing Apps, Enterprise Resource Planning (ERP)/Enterprise Resource Management(ERM) and Banking, Financial Services and Insurance (BFSI).

“Spending on information technology (IT) products and services by enterprises in the Asia Pacific is expected to grow by 8% and will exceed US$367 billion in 2012 according to Gartner. In the context of Malaysia, enterprise IT spending is expected to reach RM31.5 billion (US$10.02 billion) in 2012, up 6.1% over 2011. This is good news for us as these significant developments in 2011 have set the tone for 2012 and 2013. Thus, we are geared to ensure that our companies are deploying the right go-to-market strategy to capture this opportunity,” concluded Datuk Badlisham.

Under this plan, MDeC’s next broad objective will be helping a new wave of up-and-coming MSC Malaysia status companies break into key emerging markets via a comprehensive private sector driven programme focussed on enhancing sales and marketing capabilities through a comprehensive mentoring and partnership model known as “stacking”.

Stacks are essentially a consortium of companies with a set of non-competitive, complementary and interoperable solutions, led by an anchor company in sharing and operating within common target markets. This approach increases market exposure for new players via channel buyers or “superbuyers” as well as develop MSC Malaysia status companies to match market and demand expectations.

Part of the strategy also includes intensifying integrated promotional activities within key emerging markets in synergy with government agencies such as the Malaysian Investment Development Authority (MIDA) and the Malaysia External Trade Development Corporation (MATRADE). In Quarter 2 of 2012, MDeC and MATRADE successfully conducted two Market Missions to Jakarta and Ho Chi Minh involving over 37 local MSC Malaysia status companies, which successfully identified potential revenues in the region of RM200 million.

Dinesh Nair, Director of the InfoTech cluster added, “As we develop our suite of innovative go-to-market models, we will continue to invest in key technologies such as Cloud Computing and Embedded Industry. We believe that Cloud is an essential link that has enhanced the pervasiveness of the concept of Big Data. With a dynamic cloud infrastructure and a strong embedded ecosystem in place, we will help drive the next engine of growth for MSC Malaysia InfoTech companies between the year 2014 to 2015. This will optimise their overall revenue potential by tapping into new business opportunities arising from the Internet of Things (IoT) and Big Data” concluded Dinesh Nair.

Moving forward, deepening focus on new markets, embracing emerging technologies, and increasing customer-centricity, are some of the growth strategies adopted to enable MSC Malaysia InfoTech companies to thrive in key emerging markets. On the domestic front, MDeC is confident of continued growth and believes that there will be even more opportunities for MSC Malaysia’s InfoTech companies.