Regional IT spending to pass $100b by 2004<\/p>\n
SINGAPORE (AFP): Information technology (IT) spending in the
\nAsia-Pacific region except Japan is set to double in five years
\nto over US$100 billion in 2004, IT research firm International
\nData Corp. (IDC) said Wednesday.<\/p>\n
The growth of spending in the region is estimated at 15.5
\npercent annually from 1999 to 2004, when it will stand at $106.6
\nbillion, said Dennis Philbin, IDC's managing director for Japan
\nand Asia Pacific.<\/p>\n
IT investments over the next five years will be focused mainly
\non services, rather than on hardware and software, and the
\nbiggest spender will be China.<\/p>\n
\"What will be driving them is creating efficient, customer-
\ncentric IT systems,\" Philbin said at a forum in Singapore.<\/p>\n
The speed at which the Internet is pervading all facets of
\nbusiness is a key factor in increased IT spending in the region,
\nhe said.<\/p>\n
The so-called \"Internet economy,\" consisting of electronic
\ncommerce and spending on infrastructure, is set to grow to $123
\nbillion in 2004 from $10 billion in 1999, said Piyush Singh,
\nvice-president for consulting at IDC Asia-Pacific.<\/p>\n
The global Internet economy is forecast to grow 59 percent
\neach year from 1999 to 2003, when it will hit an estimated $3.2
\ntrillion.<\/p>\n
Companies in the region need to anticipate the eventual IT
\ntrends, such as broadband Internet's ubiquitous presence by 2009,
\nSingh said.<\/p>\n
Growth in IT spending will be fastest in Southeast Asia and
\nIndia at 21 percent, followed by Greater China at 19.6 percent,
\nSouth Korea at 9.6 percent, and Australia and New Zealand at 9.1
\npercent, IDC said in its latest survey.<\/p>\n
On a country basis, the biggest IT spender by 2004 will be
\nChina at around $33 billion, up 24 percent from 1999, followed by
\nAustralia at $22 billion and South Korea at $13 billion, it said.<\/p>\n
The laggards in IT spending by 2004 will be Indonesia and the
\nPhilippines at less than $3 billion each and Vietnam at around $1
\nbillion.<\/p>\n
At present, most of the region's IT spending is on hardware,
\naccounting for 63 percent of $51.8 billion spent last year by
\ncompanies, said Philbin.<\/p>\n
Priorities are now shifting to integrating services to help
\ncompanies get their products to customers faster and develop a
\ncompetitive advantage, he said, citing a survey of chief
\nexecutives and chief IT officers in the region.<\/p>\n
Of the officials surveyed, nearly 60 percent expected IT
\nspending to make them more efficient in less than a year, while
\nmore than 30 percent expected results within 18 months, Philbin
\nsaid.<\/p>\n
The difficulties to be faced include a skills shortage, a
\nmentality of needing more hardware, integrating new and existing
\nIT processes and the speed at which the Internet is driving all
\nfacets of business, he said.<\/p>\n
Amid the volatility on Nasdaq and in technology stocks around
\nthe world, Philbin was cautious over the slew of initial public
\nofferings of new technology companies.<\/p>\n
\"It is important to step back and ask where's the value of
\nthis company. It lies in how the customers' needs are addressed,
\nand that isn't measured by Nasdaq,\" he said.<\/p>",
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