(SINGAPORE) Infocomm vendors in Singapore can expect a $1.14 billion government procurement bonanza this year. That is the estimated total value of new IT-related tenders expected to be called by the public sector this fiscal year.
At an IDA seminar yesterday, its chief executive Ronnie Tay said the industry could look forward to more than 390 new infocomm tenders in the coming 12 months.
The figure of $1.14 billion eclipses last year's projections by about 50 per cent. In 2007, the government projected $730 million worth of infocomm tenders. A total of $2.12 billion worth of contracts were awarded last year.
In fiscal 2006, infocomm tenders worth $620 million were projected, with $850 million awarded. The government's fiscal year 2008 started on April 1 and stretches till March 31, 2009.
The announcement spells good news for IT vendors in Singapore, but perhaps even more so for the big players. There are 13 tenders worth $10 million or more, collectively adding up to $810 million - or more than 70 per cent of the estimated total procurement value this year.
One large player which plans to profit from the available tenders is ST Electronics, the $1 billion electronics subsidiary of ST Engineering. ST Electronics president Seah Moon Ming said the burgeoning procurement activity reflects the growing importance of infocomm technology to the public sector and the general economy in Singapore.
At the lower-end of the tender value, it is expected that there will be 226 tenders worth less than $500,000 this year. These lower-value tenders add up to a total of $50 million in estimated procurement value.
But the much-smaller pie does not mean smaller vendors will lose out, said Lara Lai, vice-president of Sky Media, a 20-person home-grown Singapore digital content developing firm that has done projects with a number of government agencies, including the Ministry of Education (MOE).
'I don't see ourselves as being out of the picture,' she said. 'For projects that are suitable for our scale, it is good news now there are (more such) projects. For the bigger ones, we can go in as a consortium.'
Douglas Choo, director of corporate development at HeuLab, a 38-person Singapore learning software firm, echoed similar sentiments. By pursuing consortium-based bids for public sector projects, smaller players can thrive, he said. 'With Heulab, we will definitely be able to tap on the niches that other big players cannot do.'
According to Pauline Tan, senior director, Government Chief Information Office, IDA, the biggest government spenders include the IDA, Ministry of Finance, Inland Revenue Authority of Singapore (IRAS), Ministry of Home Affairs (MHA) and Ministry of Defence (Mindef).
The single biggest tender this year is likely the Next Generation National Broadband Network Operating Company (OpCo) project, which the government will be funding up to $250 million. This is the second part of Singapore's next generation ultra-fast broadband, a project which will have nationwide coverage by 2015. The OpCo will operate the network.
Another headliner this year is the government's tender for its second data centre, estimated to cost $100 million. This 30,000 sq m facility will house government ICT systems and will be procured on a build-and-lease model.
MHA and Mindef expect their total infocomm procurement value this year to be worth an estimated $88 million and $102 million respectively.
IRAS will be putting out tenders this year to enhance its one-stop e-services portal, called IRIN (Inland Revenue Interactive Network).
Last year has been a bumper year in terms of public infocomm tenders awarded, including the $1.3 billion Standard ICT Operating Environment (SOEasy) for the public sector.
Other major projects awarded last year were the Supply of Integrated IT Support and Services by Mindef; the Forward Command Post by MHA; and the Corporate Resources System by National Library Board.
This article was first published in The Business Times on May 15, 2008
