Cloudflare’s 2026 App Innovation Report highlights the crucial link between application modernisation and improved returns on AI investments in the Asia-Pacific (APAC) region. Organizations that modernise applications are three times more likely to reap AI benefits, with 92% of top firms recognizing it as vital for success. However, only 14% of APAC companies, including Australia and New Zealand, are progressing in their modernization efforts. Findings reveal a “developer paradox,” where leaders focus on refining existing systems, while laggards tend to start from scratch due to technical debt. Governance also impacts modernization success, with 72% of leaders centralising decision-making for faster and more substantial investments. As AI adoption transitions to integration, 90% of top organizations have successfully integrated AI into their systems, making timely software updates a key factor. Emphasising security alignment, the report notes that leaders experience four times greater AI maturity. Cloudflare underscores that modernised infrastructures are essential for successful AI deployment and cybersecurity resilience.
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