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Cloud computing could add $10 billion to GDP: PwC
Cloud computing technology could increase Indonesia's gross domestic product (GDP) over the next five years and spur other trickle-down benefits.
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ndonesia could add US$10.7 billion to its gross domestic product (GDP) between 2021 and 2025 if the country adopted cloud computing, a PricewaterhouseCoopers (PwC) study shows.
PwC's study suggests that cloud computing would improve productivity through cost or time reductions to increase sectoral value-add and output levels. The study was adapted from a 2020 Centre for Strategic and International Studies (CSIS) study.
PwC Indonesia environmental, social, governance (ESG), government and infrastructure advisor Julian Smith said the benefits of cloud computing included creating more jobs and improving public services through efficient health care and education.
“Cloud computing plays an important role in generating economic value and can have a positive environmental impact by reducing the need to travel,” he said on Tuesday.
Smith added that large-scale adoption of cloud computing was also expected to save energy by consolidating computing resources from individual data centers to the cloud provider’s data centers.
The PwC study, titled The Impact of Cloud Computing on the Indonesian Economy, showed that 89 percent of small and medium enterprises (SMEs) already use cloud computing while 9 percent of respondents said they were planning to use it in the near future.
As much as 84 percent of SMEs that already use cloud computing reported that their revenue had increased 20 percent or more. The increase varies based on the type of industry in which they operate, with the business service sector experiencing the greatest improvement.
Read also: Firms struggle with cloud migration, despite high pandemic demand
Meanwhile, 80 percent of large enterprises in the survey said they were already using cloud computing while the rest were planning to use the technology within the next three years.
One-third of the larger enterprises also noted that using cloud computing had enabled them to save costs by 40 percent.
Dino Milano Siregar, digital finance innovation director of the Financial Services Authority (OJK), said cloud computing had been integral for financial service institutions. He said the technology enabled companies to maximize data storing and processing on a large scale and simplified app development.
“On the other hand, this technology has inherent risks as cloud computing adoption gets broader,” he said. “We urge start-ups to be careful in choosing a cloud service provider. In addition, companies need to have adequate risk management strategies and conduct regular audits.”
Indonesia is one of the fastest-growing cloud markets in Southeast Asia. Global cloud computing companies such as Amazon Web Services (AWS) and Google Cloud have all established a local cloud region in Indonesia over the past three years.
Read also: Amazon Web Services launches first Indonesia cloud edge location
Communications and Information Ministry government interoperability technology and infrastructure coordinator Ade Frihadi said cloud computing also benefited the public sector.
“There are two main benefits. First, cloud computing can help minimize the budget, one of them being the infrastructure budget. And second, it boosts organizations' effectiveness as a result of the collaboration between entities; the government, private sector and public sector.”
