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The RESEARCH GROUP projected the Asia Pacific region, including Japan, to have 183.3 million net subscribers in 2003, compared to 162.8 million in the United States.
Western Europe will have an estimated 162.2 million users.
Asia Pacific, however, will lag behind the United States in terms of Internet access revenue for at least another five years.
By 2005, the Asia Pacific Internet access market will be worth $17.2 billion. The U.S. market will continue to lead with $21.2 billion.
“This differential between subscribers and access revenue illustrates a major reason why Internet use is still growing rapidly in Asia Pacific,” Gartner Dataquest’s senior analyst Andrew Chetham said in a statement.
“The region has some of the lowest Internet access rates in the world, and prices are still coming down as a result of competition or, in some cases, government direction.”
While the growth of Internet access continues to be impressive, there are "holdouts" even in developed countries. Percentage of residents who, when surveyed, had used the Internet in the previous 30 days.
U.S. Internet Service Providers (ISPs), which have refrained from slashing prices, will continue to reap strong revenues as their customers buy higher value services beyond simple net access, Chetham told Reuters.
The region had 78 million Internet subscribers at the end of 2000 and 248 million are expected by 2005.
Japan, with 24.4 million online, had the largest subscriber base at the end of 2000, followed by South Korea (16.7 million), China (14.6 million) and Taiwan (4.6 million).
China is expected to overtake South Korea as the second largest market in the region by this year but will not overtake Japan until 2004.
By 2005, China and Japan combined will have about 151.5 million subscribers, representing 61 percent of the total Asia Pacific subscriber base.
Chinese ISPs will eventually be amongst the largest and potentially the most profitable in the world, Chetham said.
“The ISPs business is about scale. If you’re taking the same revenue from each (customer), but its costing you less to service each one, that’s the path to profitability,” Chetham said.
India is expected to have the highest growth rates in the region with average subscriber growth of 44 percent a year between 2001 and 2005.
India will have 21.3 million subscribers by 2005, making it the fourth largest market after China, Japan and South Korea.
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