Report: Asia’s E-Commerce Applications Market Will Top $1.3 Billion in 2003

A report recently released by International Data Corp. (IDC) — “eCommerce Software Applications Market in Asia/Pacific” — indicates that by the year 2003, the e-commerce applications market in the Asia/Pacific region will top $1.3 billion (US$). IDC defines such applications quite simply as those that enable companies to conduct business online.

According to IDC, the market (whose numbers exclude Japan) began to prosper in 1998, due to an expanding number of companies and organizations, and their staff IT professionals, looking into existent e-commerce software solutions, instead of developing their own. The IDC report listed a number of trends that have helped to shape the market.

A significant growth in sales was of course the starting point for IDC in tracking the market. E-commerce application sales topped $20.8 million in 1998, up 104% from $10.7 million in 1997. IDC projections see a $169.76 million dollar market in the year 2000.

Content Rules

Another significant trend that IDC has identified as being a factor in the current e-commerce market has involved two types of products:

Applications that help Web sites to improve customer relations, and Applications that assist sites to better manage content. “Both will be increasingly important to companies betting their future on the Internet,” said a company statement. Other trends indicated include a fragmentation in the store creation market, the portal squeeze and the emergence of a hosted marketplace business model.

Additionally, according to IDC, “vendors will find the key success factor to penetrating Asian markets depends on how much effort is made to localize their technology. Examples include creating software that provides double-byte versions of their products and services or understanding cultural issues that preclude online buying.”

E-Commerce Down Under

Including a country-by-country analysis, IDC found that the market for e-commerce applications in the sub-region Australia/New Zealand led sales for the entire region included in the study. According to IDC, “this is mainly a result of the use of English as the main language medium, a relatively mature IT infrastructure, and high Internet user penetration.”

Other countries with higher selling e-commerce application markets included Malaysia, Singapore, South Korea and Taiwan. Additionally, IDC identified the top eight vendors in the overall e-commerce applications market, who account for close to 75% of the total license sales revenue for the entire region. The vendors include Ariba, BroadVisionInterShop, InterWorld, Netscape, OpenMarket, Oracle and Sterling Commerce.

IDC is a division of International Data Group, specializing in IT media research.