FPT’s staff in the technology sector in 2018 alone accounts for more than one-third of total personnel added over the 2018-2020 period, focusing on areas such as cloud computing, Artificial Intelligence (AI), automation, etc. After divesting from distribution and retail, FPT is focusing on technology development. After a period of investment outside the industry, FPT has returned to its core.
FPT on technology
The software segment accounts for up to 85% of FPT’s export turnover in 2016. In addition, according to forecasts by market research firm IDC, spending on digital transformation worldwide till 2020 is $ 2,000 billion. In that, Asia-Pacific (including Japan) is the largest spending market for digital transformation, accounting for 37%. The second place is taken by America, accounting for 30% of total spending.
Mr. Bui Quang Ngoc, Vice Chairman of FPT Board of Directors, said that these are also the two biggest revenue contributors. Especially, the Japanese market, when software export revenue from this market accounts for over 50% of total export revenue of FPT with the growth of more than 30% per year. FPT Japan is currently a partner of nearly 300 Japanese corporations and has taken part in important processes such as research, development and maintenance of core systems.
Catch the wave of digital transformation
The digital transformation in the world market in the near future is expected to focus on three trends: artificial intelligence, automation, and digital technology. In particular, digital platforms have been promoted by large enterprises as they are seen as a stepping stone for their development in the new era. It can be more clearly understood by the story of General Electric (GE). This US multinational corporation has realized that businesses with a digital foundation such as Google, Apple, Amazon or Facebook, if not outperforming them in terms of market capitalization, are also achieving market capitalization in half the time of industrial corporations’ as GE has done in the past.
As a result, FPT has entered the digital technology arena by developing Predix, a platform that connects industrial devices such as jets and power plants to calculate failures and reduce operating costs. Mr. Ngoc said that FPT Software was currently a partner of Skywise (Airbus), AWS Cloud (Amazon Web Services), MindShere (Siemens), Predix (GE).
As for automation projects, FPT is developing successfully a commercial 4-seater car. These projects are mainly used for transportation in warehouses, which are not too complicated. It is known that FPT Software is implementing 150-autonomous-car projects for 20 customers in Japan, Korea, Europe, and America.
At the same time, FPT Software is expanding its offering of solutions to major automotive manufacturers, including OEMs producers and suppliers of tier-1 components.
In the field of artificial intelligence, FPT is now developing a platform for AI, typically FPT.AI – the first dialogue platform in Vietnam. The system applies advanced machine learning techniques for natural language processing/understanding (NLP/NLU), supporting the construction of automated communication systems to integrate into the dialogue platforms ( Facebook Messenger, etc.), self-developed business conversation applications, and smart devices (robots, mobile phones, controllers,…).
There are a number of companies in the health sector in the US and telecommunications companies of Singapore having applied the AI platform of FPT to serve customer care and reply to email.
At the same time, FPT is also making the second expansion to its overseas market. The Group has deployed successful IT services and solutions in Vietnam to markets in developing countries such as Bangladesh, Myanmar, and Indonesia. “Currently in Bangladesh, FPT Software has clients in the tax, electricity and gas sectors,” added Mr. Ngoc.
The trends that FPT has participated is relatively new, which could create a potential market with a double growth rate of at least 25% over the next five years. However, in the short term, FPT will spend a lot of money on research and development, affecting the profitability of technology segment in the future. However, we can still be optimistic that the stock price of FPT is quite stable due to the high focus on sectors with steady cash flow, such as technology, telecom, and education.
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