The Asia/Pacific region is the fastest-growing market in the world for information technology, telecommunications and support services. The region offers tremendous opportunities across all sectors, but is not an easy one for vendors to address because of wide variations across the various countries.
During my recent "Asia busman's holiday" it became obvious to me that there's no longer mention of when or if when talking about IT anymore, because most countries recognise the need to strengthen their positions in the high-tech arena. In the short term, though, several countries urgently need to import IT professionals from overseas to catch up very quickly.
With China's entry into the World Trade Organisation (WTO) the Chinese market will bring Hong Kong and the rest of the world plentiful business opportunities. After entering the WTO, China will become more open, its commercial laws will be better for business, and the legal system will be easier to understand. All this will must surely increase vendor confidence.
Asia now has millions and millions of entrepreneurs -- bottom up -- who are creating the new economies in this part of the world. Economists seem to ignore the entrepreneurs. Fortunately, entrepreneurs ignore the economists.
Governments across the region are betting their futures -- not to mention a fair amount of public treasury -- on high technology and the Internet. Faced with the end of the age of manufacturing, Asian governments are now looking at high technology as their next best hope with several countries hoping to become leaders over the next few years, rather than the next decade.
The potential size of the Asia/Pacific market has also led to a rash of ill-conceived, insufficiently researched and under-financed ventures that have failed and in so doing have somewhat soured the future of other similar ventures. Conversely there have been notable successes where the correct parameters have been observed.
Asia-Pacific presents two faces that are now -- and must always be -- kept as two distinct marketing strategies. Some countries present a western-style, high living standard and an economy that is a perfectly valid market for products and services that have proved themselves in similar environments elsewhere.
Distribution channels also need to be carefully chosen and nurtured. If the channels are not well supported, not regularly qualified, and not able to meet the end user dedication necessary to build a long-term image, the vendor will not be regarded as a well-established supplier.
Drivers of change
Networks are also critical to every nation's economic growth. We are currently seeing in the region the emergence of something much bigger than a new model of computing or even a new channel for human interaction. Information technology and specifically network technologies represent the most powerful tools we've ever had for change. These are becoming the new engines for economic growth.
Countries in the Asia/Pacific region can no longer be regarded as merely astute followers of technological trends initiated elsewhere. They are very much innovators in the successful use of IT across the spectrum of administrative commercial and social life. And this is only beginning to achieve the critical mass that will allow the region to make even more rapid progress over the coming years.
All governments now have plans in place to set information technology policies. These include specific objectives and deadlines for training, creating IT cultures, enhancing communications infrastructures; generating and supporting e-business applications; fostering a world-class indigenous IT industry that ranges from software to hardware and services; and pioneering new IT applications through R&D.
Strong growth in IT markets mirrors and -- also is driving -- the supply side. The software market has shown rapid growth and together with services dominates the market. Single-user systems, mainly PCs and workstations, have grown strongly but the decline of other hardware categories has meant that hardware's share of the market has fallen. With the rapid growth of the Internet and networks, data communication equipment is likely to continue to form the most dynamic market. High-speed networks and high-bandwidth connections to the Internet are nonetheless transforming how Asian economies and societies function.
Rapid growth in the use of the Internet and the emergence of electronic commerce has the potential to transform economics and social activities, but this potential is only just beginning to be realised. The diffusion of electronic commerce is likely to follow the usual S-curve for new and pervasive technologies. As the characteristics of electronic commerce evolve, the related policy concerns are likely to evolve as well.
By 2004, six of the top seven most intensive e-commerce countries in the world will be in Asia, led by the city-state of Singapore. Also entering the picture is India, an emerging high tech powerhouse that last year announced a target of $US50 billion export software sales by 2008.
We must also take note of China, which is leapfrogging over the PC to launch straight into mobile Internet access, according to a report by Steve Burden, visiting professor of e-commerce at the University of Technology, Sydney.
IDC estimates over the next five years the Internet user base in the Asia/Pacific region will grow at an annual rate of 40.6 per cent bringing the number of Net users to 141 million by 2004. The value of e-commerce transactions will grow at an annual rate of 128 per cent over the same period.
Reasons for this enormous Net growth include falling Internet access tariffs and an increasing interest in Internet-related initiatives across the successful "old economy" companies throughout the region.
Difficulties of diversity
Asia/Pacific, though, is not a homogeneous region: each country is unique and needs to be addressed differently. It is also necessary to provide local language Web sites in many countries in the region. The diverse nature of the region's markets continues to pose many challenges: the range is enormous. The region has some of the most developed markets in the world but also some of the poorest.
A big concern for Asian countries is the current brain drain of skilled IT staff to the West. Many countries such as India, China, Malaysia and the Philippines are suffering, and expect the loss of expertise to affect economic growth in the home countries in key economic sectors and IT in particular.
Although the research numbers on Asia Pacific markets vary widely -- particularly in the number of Internet users -- by 2003 half of the world's users will be in Asian countries.
Wang Zhidong president and CEO of China portal Sina.com recently commented: "the Internet in China has now entered a more 'mature' stage". He pointed to projections for Sino.com membership, which he said "now stands at 16 million, perhaps we can't double this figure every six months but in the rest of 2001 it could well break through the 30 million figure to approach 40 million".
This thirst for commercial conquest will stimulate research and development within every sector of the Asia/Pacific economy. The technological gains, networks and new applications usage will be accelerated. The impact of these developments on people and organisations will be tremendous.