E-commerce doubles in Hong Kong

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HONG KONG--An ACNielsen Hong Kong Internet User Survey shows e-commerce has grown into a $9.8 million industry with net-shopping more than doubling in the past year. The number of Hong Kong's 6.5 million population who are shopping on the Internet has jumped from just under 50,000 in early 1998 to more than 110,000 by March 1999.

"This impressive growth, against the backdrop of a relatively low adoption rate of 9% in e-commerce, indicates a huge potential market," said Helen Lok, exec director, customized research at ACNielsen Hong Kong.

"Our research shows the `virtual mall' is ready to take off. Net shop-pers are just waiting for a reliable solution to the issue of transac-tion security and better online product information," added Research Director Johnny Tsin.

The research shows the strong growth in Internet accounts with InternetService Providers (ISP) is one of the key drivers behind the surge in e-commerce.

The proportion of Hong Kong's population aged 15 and older holding an account increased from 3% in 1996 to 9% in 1997, 14% in 1998 and 17% this year. The number of Internet users in Hong Kong is expected to pass the 1.5 million mark by end of this year, while the number of peopleholding Internet accounts will grow to a projected 800,000 over the same period.

"Market growth at the consumer level is spurring competition among serviceproviders. CTINet entered the market last year with substantialinvestments to compete with the entrenched market leader, HongkongTelecom's IMS group," Mr. Tsin said. IMS still commands more than half of the ISP market but CTINet has already secured more than a 20% share.

Copyright July 1999, Crain Communications Inc.

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