Over the next five years, the Internet user base in Asia-Pacific will grow at an annual rate of 40.6 percent, 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 percent over the same period, IDC estimated.
Reasons for the rapid Net growth include falling Internet access tariffs, the emergence of the free ISP (Internet service provider) trend in the region and an increasing interest in Internet-related initiatives among the successful old-economy' companies in the region, according to Richard Jacobson, senior Internet analyst at IDC Asia/Pacific.
For the first time, China is the country with the most Internet users, having overtaken Australia in the first half of the year, IDC said. China now has 9 million users, representing 22.5 percent of the total number of Internet users in the region, followed by Australia with 7.4 million (18.5 percent) and Korea with 7 million (17.5 percent).
But the ratios will shift dramatically in favor of currently less-developed countries by 2004, according to IDC.
By 2004, China will lead with 51.2 million users (36.3 percent), followed by India at 22.4 million (15.9 percent) and Korea at 21.3 million (15.1 percent). At that time, Australia's Internet user base will have risen to 11.7 million, representing 8.3 percent of the expanded market. (See table below.)This shift makes it important that companies understand that Asia-Pacific is not a homogenous region, and each country market is unique and needs to be addressed differently, according to IDC. For example, it is necessary to provide local-language Web sites in many countries in the region, IDC said.
Table: Internet Users by Market Share 2000, 2004.
Country Market Share 2000 Market Share 2004China 22.5% 36.3%Australia 18.5% 8.3%Korea 17.7% 15.1%Taiwan 7.1% 4.4%Thailand 5.3% 4.5%India 5.3% 15.9%Malaysia 5.2% 3.4%Indonesia 4.3% 2.8%Philippines 3.8% 3.0%Hong Kong 3.6% 2.4%New Zealand 3.3% 1.6%Singapore 2.8% 1.7%Vietnam 0.4% 0.5%(Source: IDC's Internet Commerce Market Model Version 6.3, June 2000.)