Asia-Pacific Internet market to overtake US by 2003

The strong growth in the number of Internet subscribers in Asia-Pacific will see the region overtake the United States as the largest Internet subscriber market by 2003, according to research released Monday by Gartner Inc.

By 2003, Gartner expects Asia-Pacific, including Japan, to have 183.3 million subscribers, compared to 162.8 million in the United States and 162.2 million in Europe. That represents annual growth of 33 per cent in subscriber numbers over the next three years in Asia-Pacific.

Gartner said subscriber numbers increased by 65 per cent during 2000, from 47.4 million at the beginning of the year to 78 million by the end of the year. That figure will top 100 million for the first time during 2001, climbing to 138 million at the end of 2002 and the figure will rise to 248 million by 2005, Gartner forecast.

The main market drivers are falling connection prices, improved telecommunication infrastructure and strong pent-up demand to get online, especially in countries with big populations such as China and India. Access prices are cheaper in many Asian countries than in Europe and the United States, so subscriber revenue will still be higher in the United States than in Asia in 2005 – US$21.2 billion compared to $17.2 billion – although Asia will have many more subscribers by that time.

At the end of 2000, the region’s largest Internet market was Japan, with 24.4 million subscribers, followed by South Korea with 16.7 million, China with 14.6 million and Taiwan with 4.6 million subscribers. These four countries account for 76 per cent of the region’s Internet subscribers, Gartner said.

China will overtake South Korea this year and Japan in 2003, according to the report. By 2005, Japan and China between them will have about 151.5 million subscribers, representing about 61 per cent of the total Asia-Pacific subscriber base. Gartner’s figures for China are lower than those recently published by the government-affiliated China Internet Network Information Center (CNNIC).

The fastest-growing Internet market in the region will be India, with annual subscriber growth of 44 per cent from now until 2005, according to Gartner. It will then be the fourth-biggest Internet market in the region with 21.3 million subscribers, Gartner said.

Gartner, in Stamford, Conn., can be reached at