Asia e-comm deals tap into big market

A string of Asian e-commerce initiatives kicked off in recent weeks will tap into a market headed for phenomenal growth over the next several years, according a recent IDC report.

Cooperative efforts between US and Asian companies, such as a deal announced yesterday by Hong Kong-based 'Net portal operator China.com and TheBigStore.com, may be the key to success in that market, analysts said. Other Asian e-commerce deals have been announced this week by eCommerce.com, Tianrong Internet Products and Services, Xin Net, and ChinaMallUSA.com.

Market research company IDC expects Asian consumers to flock to e-commerce over the coming four years, projecting last year's 21.7 million users to grow to 95 million by 2004. Revenue will grow from $US2.1 billion to $86.9 billion over the same period, the report said.

"It's almost impossible to comprehend the limits of this market," said Matthew McGarvey, an analyst at IDC Asia-Pacific, in Hong Kong.

With its venture with TheBigStore.com, a large US online marketer, China.com hopes to get into that market in its early stages.

The Hong Kong-based company will jointly invest with TheBigStore and the China Commerce Development Group in a venture to set up retail e-commerce sites across Asia, Australia and New Zealand. In Mainland China, the State Administration of Internal Trade also will participate, China.com said.

Consumers initially will reach the retail Web sites, which will carry the name TheBigStore.com Asia, through China.com's existing portals, such as China.com, HongKong.com and Taiwan.com. Together with TheBigStore, China.com gradually will roll out retail sites for many countries across the region, in local languages, the company said.

China.com will own 20 per cent of TheBigStore.com Asia. According to China.com, the retail sites will be built jointly by TheBigStore.com and China.com's Web development business, The Web Connection.

Ian Henry, president of China.com's international unit, acknowledged the market is in its early stages and vendors will face many challenges.

"The important thing is, we are reaching a level of critical mass that will make e-commerce a reality," Henry said. "It's a long way off before we reach something like a 1999 US Christmas."

The biggest potential market, Mainland China, presents a big challenge for fulfillment - delivery and collection - according to Henry and industry observers.

Henry said TheBigStore.com Asia will use new fulfillment methods on the Mainland, which he would not discuss in detail.

IDC's McGarvey said the company is moving in the right direction.

"It's going to take something innovative," McGarvey said, adding, "China.com has the capability to come up with something like this. They have the resources."

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