AIT aims to capitalise on digital economy openings

SET-listed Advanced Information Technology (AIT) is transforming from a system integrator into a digital technology service provider in a bid to capitalise on emerging digital economy opportunities estimated to be worth 40 billion baht this year alone.

The move is also aimed at increasing its recurring revenue stream, said president and chief executive Siripong Oontornpan.

AIT will enter into a joint venture with two SET-listed companies operating logistics and technology businesses by forming a new firm to provide cloud-based data centre services.

AIT expects to invest 400 million baht in the venture to build two data centres.

"We will seek our board's approval on the joint venture by April," Mr Siripong said.

Mr Siripong said the emergence of cloud and the Internet of Things were influencing data centre models, which must respond to a need for flexibility in demand as much as business agility.

AIT also plans to jump into the mobile application market.

Fast-changing technology has brought a significant shift in software spending from a traditional pay-per-product model to a subscription-based model, which allows customers to buy or subscribe to IT services for a specific period for a set price.

"We need to shift away from being a system integrator to widen our business portfolio instead of relying on bidding projects," Mr Siripong said.

AIT expects revenue from digital technology services to contribute up to 30% of its total within the next three years, up from less than 10% in 2015.

It also aims to become a smart company by 2019 through the use of a computerised system for all management and operational processes.

Mr Siripong said the development of Thailand's digital economy was expected to create construction of IT infrastructure projects worth 40 billion baht this year, particularly the government's national broadband project and international internet gateway.

The nationwide availability of fourth-generation wireless broadband commercial services is also persuading operators to invest more in their computer networks for greater efficiency in controlling mobile traffic, said Mr Siripong.

AIT has a backlog of 3 billion baht and is looking to bid for several government IT projects worth a combined 10 billion this year.

AIT expects its revenue to increase by 10% this year, up from 5.2 billion baht in 2015.

Net profit is expected to remain at 10% of total revenue.