F5 Predicts: Where will innovation come from in 2015?

In 2014, the charismatic leader of one of the world’s largest democracies, who won the presidency with promises of change and savvy use of social media, turned to the Internet to crowdsource his Cabinet – inviting average citizens to provide input and suggestions online. No, it wasn’t President Obama. In fact, it was President Joko Widodo of Indonesia.

Surprised? Well, maybe you shouldn’t be. While, the West – and only more recently Japan and Korea – has long been at the forefront of digital and market innovation, that pattern of leadership is about to change. The nexus of new ideas and new applications of technology is rapidly shifting to other regions, particularly emerging economies, where broadband and mobile penetration is reaching critical mass, apps have deeply proliferated in daily life, and there are fewer legacy investments or entrenched models.

According to the GSMA, China, India and Indonesia are already among the top ten top global smartphone markets with the most number of smartphone connections. Findings from Google’s Consumer Barometer also reveal that markets such as the Philippines, Indonesia and China are adopting smartphones at a higher rate than computers – a trend that is absent in the West. Without “tried and tested” successes that constrict their imagination, along with the rapid, opportunistic adoption of powerful technologies, these emerging economies have demonstrated their innovation leadership in not just politics, but also a wide range of business sectors such as finance, retail and marketing.

A startup company in Indonesia brought social network game, Farmville, to life using a concept called “Cloud Farming”. The startup develops a cloud-based platform that enables users to invest (and also gain profits) on agricultural activities, just like the game! This micro-financed farming business model is able to link the increasing adoption of internet in Indonesia with the country’s agricultural potential. How it works is simple. Through the online platform, users are able to choose from a variety of crops, select the amount of seeds to be planted, then transfer their funds to the company- who acts as a link between sponsors, farmers and other stakeholders. Instead of getting points or tokens, the users receive cash; 40% of the returns from their harvest.

In China, smart phones have become the choice for shopping and financial management among youths. Alibaba’s yearly shopping campaign on November 11, better known as “Double 11” drew an astonishing turnover of 9.3 billion US dollars in revenue last year. Of which almost half - approximately 4.1 billion US dollars, were paid via smart phones.

With the constant growth of smart phone users in China as well as the implementation of 4G service, smart phone not only exerts an influence upon traditional industries but also changes traditional Chinese customs. For instance, Alibaba and Tencent launched a “Handing out Red Envelops” app service before the Spring Festival and it sky rocketed on the eve of Spring Festival, users handed out 240 million red envelops via Alipay, which was worth a total of 670 million US dollars, and via the WeChat platform about 88 million US dollars.

Emerging markets in Asia Pacific, from China to India to Indonesia, will continue to experiment, innovate and challenge the industry status quo. Without the shackles of legacy systems or costly infrastructure, these markets will neatly side-step the pitfalls that have plagued the more mature markets and use their inherent speed and agility to leap-frog generations of outdated technology. These markets might also create an OPEX driven business culture that is more focused on performance and results than the current CAPEX-oriented economy, where investment has typically been the principle concern. While businesses elsewhere are still working on migrating to the cloud, many in emerging markets are already thinking “Cloud-First” as easy access to public cloud services from the likes of AWS, Microsoft, IBM and Google allows them to quickly get their services to market. And in most emerging markets, time to market makes all the difference between making it and breaking it due to hypercompetitive pressures.

This truly cloud-first approach is a significant reason why here at F5, we’re moving towards offering our leading security, optimization, and availability solutions as-a-service through the industry-first Silverline platform, and so that organizations can benefit from our offerings regardless of what their infrastructure model is. Whether in emerging markets or developed, we’re ready to support new innovations and ensure applications are delivered quickly, securely and with high availability as they and their users multiply exponentially around the world.