Australia - the jewel in Asia-Pac services crown, Gartner says

Australia - the jewel in Asia-Pac services crown, Gartner says

Australia is the "jewel in the crown" of the region's IT service market, according to research released last week by the Gartner Group.

Currently, Australia accounts for 32 per cent of the region's market share. In 1998, India had 14 per cent market share, followed by Korea and China with 11 per cent, while Singapore and Taiwan have 7 per cent and Hong Kong comes in at 6 per cent.

By 2002, the market share picture will make a few dramatic changes, as India will have the top services market share with 32 per cent. However, Gartner called this number "artificial," since the Indian market is largely spurred on by application software developed for export - especially centred around year 2000 work.

Australia is expected to still have a strong showing in 2002, representing 25 per cent of the services market, while China should account for 12 per cent, with Korea dropping to 8 per cent, Singapore maintaining 7 per cent, and Taiwan and Hong Kong falling to 4 and 3 per cent, respectively.

Following what is fast becoming conventional wisdom, Gartner also predicted IT professional services in Asia-Pacific will continue with double-digit growth despite the region's economic difficulties.

Gartner expects that the compound annual growth rate (CAGR) for IT services will reach 24 per cent between 1998 and 2002, which is well above the worldwide growth rate of 15.6 per cent, said Craig Baty, principal analyst for regional IT services.

And with the services market in Asia-Pacific (excluding Japan) bringing in nearly $US16 billion in 1997, high growth means that the services market is predicted to be about $US46.6 billion in 2002, Baty said, noting that Asia-Pacific makes up 5 per cent of the worldwide market.

Baty noted that overall the market will get bigger, but for markets like Hong Kong and Taiwan the growth won't keep up the present pace.

And while other areas of IT are suffering due to the dismal economic conditions, services is able to stay in the black, with Asia having less than 1 per cent impact on the worldwide services picture. "IT is seen as the key component of survival for most countries," Baty explained. "When you're having a recession . . . the first thing that improves is IT services."

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