Domestic Production
Software Development-
The Growth of Taiwan’s Software Industry
As far as software is concerned, promotion in the five main areas of product
development, technology development, personnel training, development environment
and integration, coupled with the establishment of the Hsinchu Science-based
Industrial Park, Tainan Science-based Industrial Park and Nankang Software
Park, along with the wealth of IT talent that Taiwan possesses and the efforts
made by the industry itself, have established a firm foundation for the long-term
development of the software industry in Taiwan. This will ultimately help
to establish Taiwan as the Asia Pacific region’s premier IT sector “Technology
Island”.
In 1998 Taiwan’s software industry enjoyed steady export growth of
37%, with total exports of NT$6.927 billion. In 1999, exports totaled NT$7.832
billion, representing 13 % growth compared to 1998.(see Fig.1). In the next
three years, the total domestic sales of Taiwan software industry are expected
to grow from NT$73.3 billion in 1998 to NT$200 billion by 2002, giving an
average annual compound growth rate of around 25% (see Fig. 2). It is anticipated
that exports will reach NT$50 billion, for an annual compound growth rate
of nearly 58%.
Figure 1. IT Services Sector Export Growth, Unit: NT$ million
Source: Institute for Information Industry MIC ITIS Project, Nov. 1999
Figure 2. Taiwan Software Market Forecasts, 1999 – 2003
Source: Institute for Information Industry, MIC ITIS Project, Nov. 1999
Explanation: Market scale includes only sales in the Taiwan region; export
sales are not included. The figure for system integration and transmission
systems includes hardware. Figures in parentheses are market scale growth
rates compared to the previous year.
In order to meet the challenging development objectives that the industry has set for itself, in the future, besides developing the domestic market, more effort will need to be put into the development of potential export markets, with a more diversified range of better quality products, using international collaboration tot promote the image of “First-rate Taiwanese software, “ and making an effort to build on the niche market which Taiwanese software has established in the Asia Pacific region.
The main markets for Taiwan’s software exports are the USA and Japan.
Japan accounts for 44.9% of Taiwan’s software exports, with Trend, Dynalab,
and Ulead being the main companies exporting to Japan. The USA accounts for
33.4% of software exports; the main companies exporting to the USA are Trend,
Acer, Sertek, Ulead, Newsoft and Springsoft. The third main market for Taiwan’s
software exports is the mainland China/Hong Kong still accounts for the greater
part of this market; although more Taiwan software companies have established
offices in mainland China than in Hong Kong, export sales in mainland China
are only one quarter the size of those to Hong Kong (see Fig.3).
Figure 3. Analysis of Taiwan’s Software Export Markets, 1999, Unit:NT$
million
Source: Institute for Information Industry, MIC ITIS Project, Nov. 1999
Hardware Manufacturing –
Taiwan’s IT hardware export performance is widely recognized. Taiwan
is the world’s third largest producer of IT hardware, and in important
link in the global IT supply chain, with prodcuts such as motherboards, scanners,
computer cases and power supplies.
According to statistics from the Market Intelligence Centre (MIC), local firms produced around 25% of the world's desktop computers in 2001. In recent years local firms have also moved aggressively into the production of notebook computers. Taiwan made notebook PCs is expected to command a 58% share of the world market in 2002, up from the 55% in 2001, adn the ratio surpass 60% within two years. Other new sectors include the manufacture of thin-film transistor-liquid crystal displays(TFT-LCD, for which Taiwan producers have a 28% global market share), mobile phones ()both Motorola and Ericsson, major producers of mobile-phone handsets, have placed OEM/ODM orders with Taiwan firms, and MIC expects local production to increase by 120% in 2002) and personal digital assistants, for which local firms had a 16% of global market share in 2001.
Source: http://www.washingtonstate.org.tw/English/news-events/news-briefs/