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New Zealand Digital Strategy Aiming for a Short Cloud Computing Window

New Zealand may need to get its digital transformation act faster than initially expected. The country’s Industry Transformation Plan (ITP) draft plan, which industry body NZTech helped develop, is comprehensive with details on global marketing and catering to stakeholders. But of all tech sectors detailed under the ITP, the cloud software market has been identified as needing a lot of focus as the window of opportunity to take part in the market is considerably short.

Indeed, the ITP suggests encouraging the uptake of cloud computing, assisting game developers and developing a marketing initiative to promote New Zealand technology to foreign customers, investors and skilled migrants. Moreover, the draft report pointed out that the cloud software market was subject to a “first mover” advantage. This means that failing to set things in motion in time could be a lost opportunity for the country.

History suggests the window of opportunity for software-as-a-service and interactive media companies to secure market share will be relatively short.

– New Zealand ITP Draft

Referring to the cloud computing industry, the draft expounded further that once established in a niche, firms are able to respond quickly to customer demand and expectations. These attributes are resulting in an intensifying global competition for talent and existing businesses.

The ITP draft plan has seen the vast opportunity cloud computing offers. However, it has also identified barriers that were “constraining the technology sector from reaching its full potential”. These included:

  • Steady and predictable access to skills
  • Government procurement obstacles
  • Constraints in attracting a diverse workforce, and
  • Lack of advice for digital businesses that were aiming to expand.

All these necessitate that Wellington publishes a final ITP “with firm actions and initiatives” later this year. Already, Communications Minister David Clark described the ITP plan as designed to put “some flesh on the bones” of the government’s digital strategy.

Graeme Muller, NZTech Chief Executive confirmed all these, saying that while not everything discussed in the draft plan might come to fruition, “the shared focus” between the industry and government should do its magic and accelerate the growth of the sector.

NZTech projects that ideas in the ITP draft for the digital technologies sector released by the New Zealand Government could help create vast numbers of new jobs by 2040. Current numbers show there were 38,000 people working in digital technology firms in 2020. If the current 7.5 per cent annual compound rate was maintained that would grow to almost 100,000 by 2030, Mueller said.

To make its digital goals a reality, the ITP should raise that growth rate to 8.5 per cent and at the same time encourage a more diverse workforce. NZTech calculated that such growth could create vast numbers of new jobs for women, Māori, and the Pacific people.

The cloud computing industry is definitely growing by leaps and bounds. Worldwide, it is expected to do a Cumulative Annual Growth Rate (CAGR) of 27.5% from 2021 to 2028 reaching a peak potential of USD 716.52 billion by 2028.

Careful planning is definitely a big advantage in thriving in such a highly-competitive market. But New Zealand’s approach could provide a clear advantage for the country. Already, it is setting its eyes on putting trust as a foundation in developing its digital transformation plans by allowing key stakeholders to join the discussion in drafting the country’s digital plan.

As reported on OpenGov Asia, the Industry Transformation Plan (ITP) is meant to inject sweeping changes to the way it supports the tech sector’s growth in Aotearoa. It is focused on technology as a generator of high-value jobs and export revenue.

Moreover, the New Zealand government has invested NZ$ 1 million to showcase its technology globally. Seen by many as the NZ Tech Story, the marketing campaign is designed to provide a leg-up to Aotearoa’s IT companies as they seek to take on the world.


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