1. Issues on E-Commerce Development in Asia Pacific Region 1998. 3 Jin Ho Hur (jhhur@nuri.net) Chair of Board of Directors Asia & Pacific Internet Association

2.  1998, APIA Agenda n Internet Development in AP n Reality Check n Issues n Remarks

3.  1998, APIA Asia & Pacific Region

4.  1998, APIA AP Internet Market n ASEAN (Singapore, Malaysia, Thailand, Indonesia, Philippines) n diverse, highly regulated, infrastructure developing rapidly n Australia and New Zealand n well-developed, 12 months behind US n Greater China Group (China, HK, Taiwan) n regulated, greatest possibilities in sheer volumes n India and Sri Lanka n lack basic infra, innovative with good-skilled resources n Japan n the largest, rapidly developing market n Korea n the second largest in Asia, rapidly developing market n Indochina (Vietnam, Cambodia, Laos) n just beginning, weak infra, highly regulated (no online access)

5.  1998, APIA Stages In Internet Growth Vietnam IndiaThailand Philippines Indonesia China Malaysia Korea Hong Kong Taiwan Japan Singapore Australia Source: Lotus AP

6.  1998, APIA Number of Hosts (Source : Net Work Wizards) pan a ngapore a l

7.  1998, APIA Number of Hosts a ngapore a

8. Australia Japan Korea China Taiwan Fiji New Zealand Guam Hong Kong India Macao Philippines Indonesia Malaysia Singapore Thailand U.S.A. Europe U.S.A. Sri Lanka Pakistan Nepal Bangladesh Vietnam Mongolia Papua New Guinea Legend Leased Line Dial-up or X.25 Brunei U.S.A. Hawaii Macro Map - 1993

9. Australia Japan Korea China Taiwan Fiji New Zealand Guam Hong Kong India Macao Philippines Indonesia Malaysia Singapore Thailand U.S.A. Europe U.S.A. Sri Lanka Pakistan Nepal Bangladesh Vietnam Mongolia Papua New Guinea Available via anonymous ftp from ftp://apng.org/apng/010.map.psCopyright (C) 1995 Asia Pacific Networking Group Legend Leased Line Dial-up or X.25 Brunei U.S.A. Hawaii Macro Map - 1994

10. Australia Japan Korea China Taiwan Fiji New Zealand Guam Hong Kong India Macao Philippines Indonesia Malaysia Singapore Thailand U.S.A. Europe U.S.A. Sri Lanka Pakistan Nepal Bangladesh Vietnam Mongolia Papua New Guinea Available via anonymous ftp from ftp://apng.org/apng/010.map.psCopyright (C) 1995 Asia Pacific Networking Group Legend Leased Line Dial-up or X.25 Brunei U.S.A. Macro Map - 1995 Hawaii

11. Australia Japan Korea China Taiwan Fiji New Zealand Guam Hong Kong India Macao Philippines Indonesia Malaysia Singapore Thailand U.S.A. Europe U.S.A. Sri Lanka Pakistan Nepal Bangladesh Vietnam Mongolia Papua New Guinea Legend Leased Line Dial-up or X.25 Brunei U.S.A. Laos Cambodia Hawaii Macro Map - 1996 Does not include International NSP Backbones Europe New Caledonia

12. Australia Japan Korea China Taiwan Fiji Tonga Vanuatu Solomon Islands New Zealand Guam Hong Kong India Macao Philippines Indonesia Malaysia Singapore Thailand U.S.A. Europe U.S.A. Sri Lanka Pakistan Nepal Bangladesh Vietnam Mongolia Papua New Guinea Legend Leased Line Dial-up or X.25 Brunei U.S.A. Laos Cambodia Hawaii Macro Map - 1997 Does not include International NSP Backbones Europe New Caledonia Seychelles

13.  1998, APIA Reality Check n Internet infrastructure development n Is getting stronger, but still needs further development, especially on regional backbone n Has been largely in sync with economic development stages n Regional hubs :Japan, Hong Kong, Singapore, Australia n E-Commerce efforts n Are emerging; not yet a significant market driving force, but mostly entrepreneurial efforts or long-term investment n Most efforts are targeting at domestic market with a few regional ones n Few, if any, success stories yet n Many are still confused on the proper business model n Many eyes on business-to-business, rather than business-to- consumers. Few actual developments in reality

14.  1998, APIA E-Commerce Examples n Cases n Aggregation: eg. asia-online.com n News services: eg. Pointcast Asia n Online shopping: numerous n Feature services n Real estate information, stock information, entertainment,... n Local information: eg. Digital city guide n Remarks n A number of trial/speculative services n Few, if any, mission critical services yet: eg online stock trading

15.  1998, APIA Reality Check Immature market Low Internet penetration Lack of confidence Lack of infrastructure - Financial, telecom Few business cases Limited services/apps

16.  1998, APIA Reality Check n Financial infrastructure n Lack of readily-available payment system n Lack of credit analysis and notary system applicable n Telecom infrastructure n Low Internet penetration ratio : n AU/NZ highest per capita world-wide, Japan reaching 10% n Insufficient regional backbone n Confidence of consumers and providers n Lack of real world utilization of information: distribution, trading, real- estate, stock, …. n Concern on security n Concern on dispute resolution and liability issues n Building business Cases n Task of mapping real world applications vs creating new apps n Task of making success cases

17.  1998, APIA Observations n Prioritization is needed to handle diverse issues. n In short term, market development is of higher priority than policy/regulatory issues, assuming some changes to current impediments, especially limitations in the financial system. n Immediate study for policy/regulation is needed for facilitating E-commerce development in longer term. n In mid-to-long term, a consistent and transparent policy framework is essential for continued market growth. n Policy framework is to facilitate the realization of the real world systems on Internet consistently and transparently. n Some thoughts are to be given to the policy framework to address peculiarity of commerce over Internet, eg. Global nature of trades over Internet.

18.  1998, APIA Issues- Immediate n Mostly, market development issues n Financial infrastructure n Readily-available and interoperable credit card payment n Building business cases n Pilot projects : maybe government initiation n e.g. singapore.com n Study on legal, policy, and regulatory issues

19.  1998, APIA Issues- Mid-Term n Financial infrastructure n Interoperable e-payment systems/standards n Credit analysis/information for individuals/incorporations n Building certification infrastructure: e.g. CA n Security n Interoperable standards for cryptography, e-signature,... n Transparent policy, not impeding private sector efforts n Legal and regulatory issues n Legal status of e-documents, e-signatures, … n Taxation and customs

20.  1998, APIA Issues- Long-Term n Uniform “Commercial Code” n Legal status of electronic contracts, electronic documents, electronic signatures,… n Dispute resolution and liability n Reflection of real world practices n Trans-border issues are of particular importance. n E-Payment n Interoperable, diverse payment methods n Considerations for common currency for intra- and inter- regional trades

21.  1998, APIA Remarks n Proper policies and standards are required, but market development is of higher priority initially. n “We are not creating an entirely new animal.” n Most issues are closely tied to real world economic issues. n Financial infrastructure n Policies and regulations n Infrastructure is to be institutionalized as soon as possible to facilitate private sector efforts n Especially, financial infrastructure

22.  1998, APIA Remarks n Policy and regulations are not to restrict market development n Consistent and transparent n Issues specific to each economy/region should be considered n Different standards on value n Currency