Asia lags in online transactions -- IDC

Very few Asian companies to date have developed Web sites which can handle business transactions, according to Dennis Philbin, managing director of research company IDC Asia-Pacific.

And while the number of companies here that have set up a Web presence has increased significantly over the last 18 months, there are still a number of factors inhibiting quicker electronic commerce development, he said yesterday at the Second Roundtable on E-Commerce in Asia.

"The proportion of Asia's top 1000 companies with a Web presence has risen from 58 per cent to 78 per cent in the past 18 months, but almost none of them allow business transactions," he said. "Senior management has yet to be convinced that the Internet is key, and there are cultural issues to do with the preferred languages on Asian Web sites."

IDC figures predict that the number of devices attached to the Internet will grow rapidly but unevenly across Asia (excluding Japan).

Today in Asia, only Australia, New Zealand, Hong Kong and Singapore have Internet penetration rates above 10 per cent, according to IDC figures. The number of devices -- principally PCs and network computers -- attached to the Internet is expected to grow at 30 per cent a year from today's figure of 12 million to around 60 million by 2003, IDC said.

By that time, China will account for 30 per cent of the devices attached to the Internet in Asia, followed by India and Australia, IDC said. But Australia, with its more developed economy, will remain the largest market for e-commerce in Asia.

Many Asians still believe there are inherent security risks associated with a new technology such as e-commerce, and the lack of local e-commerce vendors is also holding back adoption of the technology, Philbin said.

The variety of languages and scripts across Asia is also an inhibiting factor, with 75 per cent of people accessing the Internet in the large Chinese and Korean markets preferring Web sites in their own languages, he said. Almost half the Web site content in Asia is created using double-byte Asian characters, principally in China, Hong Kong, Korea and Taiwan, according to IDC figures.

Despite the drawbacks, there is a growing demand for business-to-business and business-to-consumer connectivity, driven by lower equipment costs, government commitment, and an increase in local-content Web sites, Philbin said.

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