NTT Data Inc, a leader in technology services, has outlined its new global operating model, while repledging its commitment to the Thai market.
NTT Data recently introduced its new operating model, effective from April 2024, along with a new executive.
The company said the merger of NTT Data with NTT Ltd highlights its commitment to maintaining leadership in the IT and technology sectors.
Abhijit Dubey, the global chief executive of NTT, is slated to become NTT Data's chief executive in April.
In an exclusive interview with the Bangkok Post, he said NTT started the process of global expansion in 2007, continuing that momentum for enterprise IT services and infrastructure.
NTT’s Bangkok 2 Data Center in Amata Nakhon in Chon Buri province.
Over the years, the company acquired numerous businesses worldwide, prompting the need to consolidate these entities. The goal was to establish a single global IT services infrastructure powerhouse, positioning NTT among the top five IT service providers worldwide.
"Following the integration, we stand as a US$30-billion firm, with $12 billion originating from Japan and $18 billion from alternative sources," Mr Dubey said.
"We possess global scale and relevance, operating in 57 countries, complemented by robust local capabilities, expertise and empowered teams, just like here in Thailand."
This approach enables NTT Data to combine global capabilities with local expertise, fostering close proximity and strong client relationships, he said.
The merger also turned NTT Data into a financial powerhouse, gaining access to both capital and lots of cutting-edge innovation, Mr Dubey said.
As a global company, it can deploy about $3 billion per year in capital worldwide, he said.
"For our data centre business in Thailand, we already built two data centres and are constructing a third in Bangkok," Mr Dubey said.
MAINTAINING MOMENTUM
Under the new operating model, he said the company expects a much higher level of growth and a strong profit result.
"However, as with any large merger, there are challenges to overcome. Firstly, cultural integration is a top priority. We also need to ensure we maintain our business momentum and avoid being distracted by the merger," said Mr Dubey.
Another challenge lies in effectively managing its talent capacity, he said.
Mr Dubey said the global IT service market has decelerated because of unfavourable economic conditions.
"We'll see how this plays out over the next few quarters and throughout the year. One positive about being a Japanese firm is we always take a long-term perspective," he said.
"There may be small dips here and there, but we invest for the medium and long term. Companies that invest during a downturn will emerge stronger after the upswing. This is an advantage of being part of a Japanese company."
INVESTMENT TRENDS
Regarding the business landscape overseas, the engines for growth are focused on demand for internet infrastructure and data centres, said Mr Dubey. This demand shows no sign of slowing down and has been growing at roughly 20%.
The integration of generative artificial intelligence (AI) into data centres and cloud is expected to fuel growth in those sectors, adding five to seven percentage points of growth, he said.
These trends indicate the internet infrastructure and data centre markets should remain robust, said Mr Dubey.
"We firmly believe that despite any temporary slowdown, there will be continued growth in various areas over the next 3-5 years, stemming from an acceleration in the cloud transformation, product engineering, enhancing the customer experience, and leveraging data and analytics," he said.
The company is also investing in technologies that support the convergence of IT and operational technology (OT).
OT is described as the hardware and software that monitors and controls devices, working processes, and infrastructure in industrial settings.
Businesses expected to benefit from this convergence range from manufacturing and mining to transport and warehouses, Mr Dubey said.
This convergence is essential when implementing predictive maintenance or utilising automated guided vehicles in the mining industry, he said.
To enable the adoption of technological advancements in various business sectors, a distinct level of connectivity is required, said Mr Dubey.
Traditional cloud-based data transmission is not feasible, as there is a need for computing power, analytics and real-time alerts on edge devices, he said. Real-time analytics on edge devices are particularly valuable for scenarios such as those in the mining industry, said Mr Dubey.
Therefore, the integration of edge connectivity, edge computing, real-time analytics, and tailored applications for specific use cases is crucial to bridge the gap between OT and IT and enable digital transformations in various industries, he said.
Mr Dubey said there are other areas where technology can drive the adoption of digital twin automation, as well as address supply chain challenges, geopolitical issues and time-to-market concerns.
These advancements have accelerated in recent years, largely because of two factors. One is the increased availability of connectivity options such as 5G, including private 5G networks and public connectivity.
The other is a strong focus on security in the OT realm, ensuring the same level of security as in the IT environment.
GENERATIVE AI
He said he believes generative AI is likely to be the next major technological revolution, even rivalling the impact of the internet.
"The technology's potential to transform how people live, work and play is truly extraordinary," said Mr Dubey.
"We think almost $10 billion of our revenue in the future will be related to generative AI, which is huge."
The use cases the company has already deployed range from the automation of software development to smart document management.
"The company supports all major large language models. NTT also announced its own large language model, which will be available in English in 2024 and will include industry-specific models," he said.
MARKET LEADER
Thailand holds a significant position as a top 15 market globally for NTT Data and its business overseas.
Mr Dubey said a research study revealed the company ranked No.1 in terms of market share for IT services and IT infrastructure in Thailand.
"We are the leading player in IT services and infrastructure in Thailand, making it a critical market for us," he said.
"Our comprehensive service offerings, encompassing data centres, resources and application support, contribute to our strong presence in the country. This allows us to serve both local and global customers, including esteemed Japanese clients."
The company is committed to investing in physical infrastructure in Thailand, said Mr Dubey, referring to the announcement of its third data centre here, with investment totalling several billion dollars.
The outlay demonstrates the company's dedication to bolstering capabilities and meeting the growing demands of the market, he said.
Following the implementation of its new operating model, the company's local workforce in Thailand is set to reach roughly 1,700.
"Our presence in this area enables us to provide support to Cambodia, Laos and Myanmar. Expansion to these nations signifies our commitment to future growth and development," said Mr Dubey.
There are two primary considerations for investing in any country, he said.
"If you plan to make capital investments, such as in a data centre business, it's essential to have access to renewable energy sources, as we have committed to being 100% renewable by 2030. We always look for the availability of renewable energy in the local context," said Mr Dubey.
"Second, in terms of IT services, having access to critical technical talent and the ability to build technical capabilities in the country is very helpful. Policies that simplify land acquisition and construction operations can also aid us in our data centre business."
ASIA FOCUS
He said in a truly global market for IT services, only four major companies operate at scale: Accenture, Capgemini, TCS and NTT.
Among the companies generating revenue of more than $25 billion, Accenture is a North America-based champion, Capgemini focuses on Europe and TCS is based in India.
"We aim to become the champion for Japan and Asia. That's our ambition -- to be a truly global IT services leader, starting from Asia and Japan," said Mr Dubey.