Report: Southeast Asia’s internet economy to grow to $200B by 2025 | Tech News
There isn’t a lot of data on the potential of technology in Southeast Asia, which is why many in the industry have been excitedly flipping through a new report released today by Singaporean sovereign wealth fund Temasek and Google. The biggest takeaway: Southeast Asia’s internet economy could be surge to be worth a massive $200 billion annually within ten years.
The region typically falls into the shadow of China’s thriving tech space and India’s fast-growing ecosystem, but deals like Alibaba’s recent $1 billion investment in Lazada and Southeast Asia’s cumulative population of over 600 million people are putting it on the map, many just coming into contact with the internet or mobile for the first time. For them, technology promises to be truly transformative and enabling.
Beyond the headline $200 billion stat, the research — pulled together using “proprietary data” from Google, Temasek insight, interviews with third-parties and other sources — gives some color on where the most notable tech verticals may be by 2025:
- E-commerce in the region could be worth $88 billion, growing at 32 percent per year
- The online travel market could reach $90 billion, growing at 15 percent per year
- Online media — games and advertising — could grow to $20 billion, increasing at 18 percent per year
- The region’s nascent taxi on-demand service could hit $13 billion and 29 million monthly riders — up from an estimated 7.3 million now — growing at 18 percent per year
With 260 million users now and an estimated 480 million by 2020, Southeast Asia’s is the world’s fastest growing internet market — adding 3.8 million new users a month. Beyond that, its young population (70 percent of which is aged under 40), lack of “big box” retailers serving entire countries and growing middle classes are forecast to power this surge forward.
The report cites plenty of challenges — particularly around tech talent, barriers around payment, inconsistent regional logistics and immature consumer behavior — but Temasek and Google believe that with $40-$50 billion in investment capital, the region’s digital economy can take huge strides over the next decade.
I fell in love with Southeast Asia when I moved here in 2008, and the potential for technology to make a difference in people’s daily lives — whether it be e-commerce, online banking or even just keeping in touch with family via messaging and calling apps — is what has kept me here and kept me interested in watching this great transition unfold.
I don’t want to cannibalize the report too heavily by republishing the deck extensively, but the slides below are particularly worth poring over.