ABS data released today bodes well for ASX companies involved in cloud computing, like Xero Limited (ASX: XRO), TPG Telecom Ltd (ASX: TPM) and Telstra Corporation Ltd (ASX: TLS).

What Does the Data Say?

The ABS released the results today from the Business Characteristics Survey 2017-18, which focused on the use of several IT innovations in Australian businesses.

One of the main components of the survey was the use of paid cloud computing services. The survey found that in 2017-18, 42% of businesses reported using paid cloud computing services compared to 31% in 2015-16.

For businesses with more than 200 employees, the figure was closer to 75%. The data clearly shows a correlation between the size of the business and the likelihood of it using cloud computing.

The survey also showed that businesses were becoming increasingly aware of the importance of cybersecurity services. In 2017-18, 52% of businesses with more than 200 employees upgraded their cybersecurity software, standards or protocols, up from 34% in 2015-16.

Here’s What It Means For ASX Investors?

Data like this highlights the growing market for IT products like cloud computing or cybersecurity.

When investing for the long term, these large macro trends can give an indication of which industries might disproportionately grow and can be a good place to start looking for investments. On the ASX, companies like Xero, Telstra, or TPG could benefit from these trends.

Further abroad, companies like Alphabet Inc (NASDAQ: GOOGL)(NASDAQ: GOOG) or Symantec Corporation (NASDAQ: SYMC), the owner of Norton Security, are also likely to benefit.

Summary

While surveys and data like this are broad it can be extremely useful for identifying the industries where the next growth companies could emerge. It’s not the only investing tool you need, but it can certainly be a good place to start.

For other megatrends, I suggest you check out this recent Rask media article.

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Disclaimer: Any information contained in this article is limited to general financial/investment advice only. The information has not taken into account your specific needs, goals or objectives, so please consider consulting a licenced and trusted adviser before acting on the information. Please read The Rask Group’s Financial Services Guide (FSG) for more information. This article is authorised by Owen Raszkiewicz of The Rask Group, which is a corporate authorised representative No. 1264179 of Strawman Pty Ltd (ACN: 610 908 211) (AFSL: 501 223).

Disclosure: At the time of writing, Max does not own shares in any of the companies mentioned.