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Organization Funds Asian-Pacific Report Card

A market survey released Thursday suggests the Asian-Pacific ASP industry is poised for growth, despite poor development programs in place in China and India.

The study, performed by UK-based InQuiro International Ltd., found there's a "high interest and awareness of the ASP concept across the region," although "understanding and familiarity of the concept varies widely from country to country."

Riding the cusp of the e-commerce wave are countries like Australia, Singapore, Korea, Hong Kong and Japan. China, India and Thailand, however, were categorized as lagging.

Traver Gruen-Kennedy, ASP Industry Consortium global chairman, said his organization commissioned the report to find out if the global ASP model is being met with success.

"ASP is truly a global business model, which is why the ASP Industry Consortium continues to look to all regions as we gauge market receptiveness," Gruen-Kennedy said. "Clearly, not all regions are equal in terms of ASP adoption. But understanding the reasons behind that inequality is the first step toward not only speeding ASP acceptance, but helping all nations take advantage of opportunities in the global marketplace."

InQuiro gauged the nine countries in the report using the four "success factors" of infrastructure, technology culture, market receptiveness and government role as its model.

Regional winners Hong Kong and South Korea share the common trait of government support for the Internet. The deregulation of the telecommunications industry has opened up the doors to a spirit of Internet entrepreneurship. Australia and Japan have had the ASP model in place for more than a year now, and are now showing the fruits of earlier labors.

China and India make up the largest Internet audience population, the report states, but are woefully lacking in government support through legal and regulatory initiatives. China has yet to figure out a fee structure for its online service providers, while India needs to invest more in its infrastructure to support its budding ASP industry.

Thailand, on the other hand, sports a government-regulated telecom market that doesn't want to invest in Internet enterprises. Businesses subsidize the telephone market for private users, making it a losing proposition to adopt an ASP.

A recent study by International Data Corp. reports there will be more than 40 million Internet users in the Asian-Pacific region spending $7.3 billion in e-commerce purchases by the end of 2000. The report also predicts 141 million Internet users by the end of 2004. China, India, Korea and Australia will account for 76 percent of that total number of users in the region.

Richard Jacobson, IDC Asia/Pacific senior Internet analyst, said the future growth is attributed to each government's investment in their telecommunications infrastructure and the emergence of free ISPs in the region.

"The Internet market in Asia/Pacific (excluding Japan) experienced a tremendous amount of activity and growth during the first half of 2000," Jacobson said. "Internet and e-commerce related activity in most countries moved up a gear. Key driving factors include falling Internet access tariffs, the emergence of the free Internet service provider trend in the region and an increasing interest in Internet-related initiatives among the successful 'old-economy' companies in the region."