In a recent article in Communications World Weekly, a leading Chinese technology news outlet, they noted that Cloud Computing was the fourth IT Industrial Revolution, after Mainframes, PCs, and the Internet. In a related article, KPMG, noted that China is projected to be on par with the U.S. as a future technology innovation leader. And according to the survey that KPMG conducted, the next big breakthrough is predicted to come from Cloud and Mobile.
Communications World Weekly reported accelerated growth patterns and predicts that despite a bumpy ride China’s public cloud computing sector will be a driving innovative force. “A research report shows that in 2012, the cloud computing of China will reach the scale of over 60 billion Yuan in the market and by the end of the '12th Five-year Plan' this industrial chain will come to the aggregate of 1 trillion Yuan. This broad market landscape and development space will usher in opportunities for many competitive partners, and also prompt the development of modern information services in China."
The KPMG survey, like Communications World Weekly, agrees that “the pace of technology innovations today is happening at unparalleled speed and China’s projected rapid rise to prominence as a technology leader would be another example of this,” said Gary Matuszak, partner, global chair and U.S. leader for KPMG’s Technology, Media and Telecommunications practice.
The KMPG survey of 668 business executives in the Americas, Asia Pacific (ASPAC), Europe, the Middle East and Africa (EMEA) noted that 30 percent expected the next “disruptive breakthroughs with global impacts” to come from China and the US. India rated with 13 percent and the US with 39%. Interestingly, only 39 percent of U.S. respondents selected the United States as most promising, while 71 percent in China selected China. They have both the cash and intelectual capital to to drive innovation.
That’s not to say that there are not challenges that China will need to overcome to reach parity with the US tech sector. The survey result’s demonstrates China’s willingness to invest in technologies that it views as disruptive. The survey highlighted three areas in which the Chinese Government is focusing.
1. Shared services and outsourcing
2. Mobile payments
3. Cloud computing
“The 12th Five-Year Plan is also driving innovation in these critical areas, in order to create a nationwide virtual environment,” said Egidio Zarrella, a partner in KPMG China.
Other interesting results were that by 2015, 30 percent of the survey respondents anticipate that Cloud Software as a Service (SaaS) will enable the next indispensable consumer technology. Also, 22 percent said Cloud Infrastructure as a Service, followed closely by SaaS, will have the greatest impact with regard to driving business transformation. In the U.S., the report predicts, SaaS was the top selection in consumer and enterprise technologies.
Some other interesting findings showed that responders viewed China as a potential challenge to Silicon Valley’s position as tech innovation center, though China will need to continue to make aggressive investments. Apple was overwhelmingly viewed as the top innovator; sorry, Microsoft. No Chinese up and comers were identified.
Another interesting point in the survey is that most, 45 percent, anticipate innovation to come from the executive suite, as opposed to R&D, 38 percent. Another nod to Jobs? They also saw innovation occuring in China's schools, 75 percent, versus 50 percent in the US.
Can China really catch and surpass Silicon Valley? Let me know what you think.