Emerging markets in Asia accelerate healthcare IT spending
ConvergenceAsia staff
30/10/2007

IT market research company Springboard Research’s latest research on IT adoption in the Healthcare industry in Asia has found that the emerging markets in Asia (China, India, Indonesia, Malaysia, the Philippines, Thailand, and Vietnam) – especially powered by China – are accounting for an increasing percentage of the IT spending in the healthcare industry across Asia.

Springboard estimates that emerging markets account for 59 per cent of the US$3.4 billion in Healthcare IT spending in Asia (excluding Japan) in 2007, with this share expected to increase to 64 per cent of spending by 2010.

“While it is no surprise to IT vendors that the emerging markets in Asia are growing quickly, the percentage of the total healthcare IT spending could provide a surprise to many vendors,” said Jonathan Silber, Research Manager for Springboard Research.

“The key strategy for vendors is to understand the solution trends in each market and tailor their strategies to make sure they are going after their addressable market, instead of just a big number. With the way the market is fragmented you cannot have a regional strategy – it needs to be focused on the countries and solutions where a vendor can execute,” added Silber.

Healthcare IT spending in the emerging markets of Asia is still very much a hardware based play as these economies build their basic IT infrastructure. Sixty one per cent of the 2007 spending was on hardware and this is expected to continue relatively steady, dropping slowly to 57 per cent in 2010 as spending starts to move more into software and IT services. Both software and IT services are expected to grow across these emerging markets at a compound average growth rate of about 15 per cent between 2006 and 2010.

Springboard’s research has also shown an increased emergence of local ISVs and SIs in the Healthcare sector in Asia’s emerging economies, specifically in niche solution areas. These local firms are both partnering and competing with the multinational players to meet the local needs of the Asian healthcare industry. Springboard expects competition to increase over the next few years as more multinational providers focus on the healthcare opportunity in these countries.

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