What issues lies ahead in the Internet and e-Business world?

By Zatni Arbi

SINGAPORE (JP): When someone from the Framingham-based IT research company International Data Corporation (IDC) speaks, heads in the IT industry turn. Therefore, it was no surprise that there were many top executives of Indonesian IT companies at IDC's Asia Pacific IT Forum 2000 in Suntec City, Singapore, early last week.

There were several interesting points made by the speakers in the forum that are worth sharing, ranging from e-Services and Chapter 2.0 of e-Business to liberalization and competitiveness.

To start with, IDC's senior vice president and chief research officer, John Gantz, listed ten issues he thought would drive IT in the next few years.

First, now that the Y2K fever is over (and a growing number of people are asking whether it was worth its US$300 billion price tag), IT departments will be spending their budget on enterprise and web applications.

The second issue is the exponential growth of Internet outfits, as opposed to the so-called "brick and mortars, or BAM" companies, which will prompt the latter to start integrating the Internet into their businesses.

The third issue that will affect everybody in the IT industry is a people shortage. In 1999, noted Gantz, demand exceeded supply by 100 percent, and the problem will not subside soon.

The fourth issue is the fact that IT continues to gain importance in business strategy, and new titles for IT directors with the same Web responsibilities will be coined.

The fifth issue is the proliferation of Internet appliances and embedded intelligence that allows Internet users to make online purchases from anywhere, anytime.

The sixth issue, according to Gantz, is the rising number of Internet users. IDC predicts that by 2003 the number of Internet users in the Asia Pacific region will be close to 140 million, with Japan accounting for 43 percent of those online.

The seventh issue is the growth of e-commerce itself. IDC predicts that by 2003, total e-commerce value in the Asia Pacific region will reach $282 billion, with business to business transactions remaining dominant. E-commerce also involves selling directly to customers, so Gantz believes the disintermediation trend would continue.

The ninth issue is, of course, the emergence of new technologies. Internet2, for example, will not only offer faster speeds but also more simplicity. Sending multiple copies of the same e-mail message, for example, will be replaced by multicasting.

Finally, he also believes that Microsoft still has the power to direct the IT industry in the future, and therefore we must keep an eye on where the software giant has been investing its cash -- namely in broadband technologies, infrastructure content and new platforms for multimedia information.

e-Service

Speakers at the forum also agreed that the next few years would see a shift from offering and selling products over the Internet, which is successfully exemplified by online companies like Amazon.com and e-Bay, to delivering services over the Net.

"An e-Service is any asset that you make available via the Net to drive new revenue streams and create new efficiencies," said Ann Livermore, HP's president of enterprise and commercial business.

In what they collectively called Chapter 2 of e-Business, the speakers, which included top executives from companies like Acer, Andersen Consulting, Computer Associates, Hewlett-Packard, Hitachi Data Systems, Lotus Development, Samsung and others, agreed that the focus would shift from issues of security, access speed and ease of navigation to issues such as service orientation, integration, interactivity, localization and personalization.

Asian competitiveness

During a break in the forum, several executives from Computer Associates (CA) held a roundtable discussion. CA is one of those companies that relies heavily on teleconferencing for their worldwide operations. Therefore, it was no surprise that CA's senior vice president, Kenneth Farber, who was supposed to speak at the forum but was unable to come, also participated in the discussion from the company's headquarters in Islandia, New York. The topic: Can Asia compete?

Several ingredients for competitiveness were brought up during the discussion, including joint ventures with global companies that can provide technologies and expertise. As Farber remarked, "CA has spent a considerable amount of time creating joint ventures throughout Asia, including setting up ASP (applications service provider) infrastructure."

Of course, joint ventures should also lead to the transfer of technology and knowledge before they really can help Asians improve their competitiveness.

One result of CA's own joint ventures in China is an antivirus software that is specially made for the local market. Called Kill, this antivirus program utilizes the same engine as CA's more widely known antivirus utility, Inoculate-IT.

CA's marketing director for Asia, Peter Kuo, explained, "Kill is tailor-made for users of the Mandarin language, rather than English, and it provides better protection against the viruses that are circulating in China." Localization of products, as mentioned earlier, will be one of the trends in the future.

What other things do Asians need to be more competitive? CA's senior vice president for advanced technology, Patrick Donohoe, said a clear business strategy is a must. He added that it was also important to make Internet experiences trouble-free.

"Businesses have to use zero-training applications," he said, "Once customers are captured, there should be no need to retrain them." Another issue that was highlighted was the need to find a niche business, as everybody is now jumping on the e-business bandwagon.

The event was held just a couple of days after the Singaporean government announced their move to expedite complete liberalization of their telecommunications industry, and this was a hot topic among those at the forum. Thus, not surprisingly, it was echoed again and again during the discussion how important liberalization is for competitiveness.

That point, fortunately, seems to be well accepted here. The government is beginning to understand the urgency of liberalization in order to speed up progress in this sector. There have even been talks about liberalizing our own telecommunications business earlier than the current deadlines.