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Cloud computing adoption remains slow among AP manufacturers

Jack Loo | April 25, 2012
IDC Manufacturing Insights study also indicates IT leaders are concerned about last mile connection speed issues.

Cloud computing is still at a nascent stage among manufacturing companies in the Asia Pacific region, according to a study by research firm IDC Manufacturing Insights.

"Keeping costs down continues to be the primary focus of Asia/Pacific manufacturers," said Dr William Lee, senior research manager for IDC Manufacturing Insights Asia/Pacific. The report Manufacturing and Cloud Computing: A View from Asia Pacific excluding Japan compiled responses from 59 manufacturers across the region.

"As most benefits of cloud computing do not directly translate to lower total cost of ownership when compared to traditional on-site IT deployments, take-up has been slow till date with fewer than 10 percent of manufacturing firms across APEJ currently adopting the technology," said Lee.

Security, not surprisingly, continues to be the biggest cloud adoption barrier for APEJ manufacturers. However, their security concern is not just about data breaches of sensitive information. The manufacturers are anxious about the consequent loss of time and expenditure of resources to reproduce the data.

"The cloud is often perceived as less secure compared to retaining data in-house. In reality, most security breaches are internal. Therefore, having data residing in the cloud does not necessarily make it more vulnerable to security risks," said Lee.

The survey findings revealed that half of the respondents are holding back on adopting cloud-based solutions due to concerns on encountering last mile connection speed problems.

However, most companies interviewed also acknowledged that their worries about connection speeds are short-lived since developments in the telecommunications network infrastructure are growing at a fast pace in most parts of Asia.

Cloud computing will have a bigger impact in the near future, according to Lee. "The current volatile market conditions in the manufacturing sector have ignited new interest in cloud as more companies are now looking for shorter term return on investments (ROI), which is one of the chief benefits of the cloud," he said.


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