Taiwan’s digital database market consistently grew 88 percent over the past five years, from US$67million in 2005 up to US$126 million in 2009. This tremendous increase is mainly made up from the growth of sales in e-libraries, valued at US$100 million, and digital archives worth US$26 million.
U.S. digital content providers or publishers should consider the Taiwan market as an excellent opportunity. Taiwan’s schools, libraries, hospitals and research centers show great interest in U.S. content. The scope of this report mainly covers digital databases, including e-libraries, on-line computer libraries, and digital archives.
Over the past few decades, Taiwan has experienced rapid economic expansion that has led to a significant increase in household incomes and making higher education more affordable. Fifty-nine percent of Taiwan’s population of 23 million has at least a college education. Taiwan’s high Internet penetration rate of over 70 percent and increasing number of e-content projects supported by the local authorities, the digital database market has grown an average of 10 to 15 percent annually for the past five years. This growth is mainly driven by demand from higher education, libraries and hospitals.
Imported digital databases supplied about 70 percent of the digital database market in Taiwan, totaling approximately US$88 million in 2009. This is an increase of 17 percent from 2008. Local production offered about 30 percent of the market totaling US$39 million in 2009. Categories in strong demand are e-libraries accessible over the Internet and digital archives. Since the U.S. has been the global leader of digital databases, U.S. content providers are welcomed by Taiwan’s schools, hospitals and research centers. Popular categories of digital databases from the U.S. are online computer libraries that specialize in eBooks, medical information, academic periodicals and essays.
In Taiwan there are 164 higher education schools including universities and colleges, plus 89 research centers that receive funding from the Taiwan authorities or local business groups. This group made up 89 percent of the digital databases purchased in Taiwan, at a value of US$113 million. Digital databases featuring the latest information on medical treatments and medical periodicals are in great demand by hospitals and medical schools. They had 9 percent of the market, or US$11 million, in 2009. While budgets for libraries are decreasing, the purchasing model of digital databases by local public libraries has been mainly on a content-sharing basis. One school is selected to negotiate a single licensing agreement with a foreign content provider for multiple schools. In 2009 the sales of digital databases to local public libraries was limited to a value of US$2 million, a decrease of 25 percent from previous year.
The educational and academic e-libraries market segment made up a large part of digital database sales with a 57 percent share amounting to US$72 million in 2009. Digital archives had about 30 percent of the market amounting to US$38 million in 2009 with a 9 percent growth from 2008.
Imports of digital databases into the Taiwan market have increased steadily from US$53 million in 2005 up to US$88 million in 2009, approximately 10 to 15 percent growth every year. The imports of digital databases remained steady due to “Green” Library projects and digitalized content, which follows the current policies of the local authorities. Imported English-language digital databases have been well received by buyers and end users and represent about 70 percent of the market. The databases originally made in Chinese are mainly supplied by local providers or publishers of e-content that have about 30 percent of the market. Transactions of imported digital databases have been mainly conducted as B2B sales through Taiwan representatives of foreign digital database suppliers.
E-libraries including subject areas of science, medical, arts, history, and engineering have about a 50 to 60 percent market share of school purchases. In the recent two years it averaged around US$65 million annually. The “Green” Library projects have led local libraries to increase their purchases for elibraries of periodicals, journals and e-books. Purchases of digital archives by schools have shown a 10 percent increase in the past two years, particularly for digital archives with comprehensive collections in academic essays, museum collections, well-known buildings, maps, and original manuscripts.
U.S. companies have dominated Taiwan’s digital database market for over a decade and account for about 50 to 60 percent of Taiwan’s annual imports. They are followed by United Kingdom, Canada and the Netherlands. Domestic production of digital databases is mainly focused on Chinese-based digital archives on local history, culture, museum collections, and historical spots in Taiwan.
In Taiwan there is excellent growth potential for U.S. providers or publishers of digital databases that feature online computer library and electronic-archives. Digital libraries of periodicals specializing in the areas of science, arts, history, engineering and literature have experienced tremendous sales increases of 20 percent annually in recent two years. The largest market for imported digital databases in Taiwan is higher education schools. Another area experiencing tremendous sales growth is digital databases related to medical information for hospitals and medical schools.
Following the local authorities’ policies supporting digitalizing content on local campuses, in recent years, higher education institutions have benefitted from receiving increases in their funding for procuring digital databases. School libraries and public libraries have increased their budget for digital databases and decreased the budget for paper publications. The increasing purchases of digital databases offer good prospects for U.S. providers of digital databases with interest in expanding business into the Taiwan market.
The outlook of the digital database market in Taiwan continues to be promising with continuous growth predicted for the next two to three years. Since the U.S. has maintained an over 40 percent market share for digital databases in Taiwan, U.S. providers should continue focusing on their sales of on-line computer libraries and electronic archives that especially target higher education institutions, libraries and hospitals.
The market demand of digital databases has been mainly supplied by foreign suppliers. The U.S. has been in the leading position and dominated the Taiwan market for a decade and for the past two years accounts for over 60 percent market of annual imports at an average annual amount around US$51 million.
Well-sold digital databases in the Taiwan market provided by U.S. providers are online computer libraries and digital archives that gather a comprehensive collection of eBooks, electronic periodicals, academic essays, journals and newspapers, museum collections, and images and graphics.
Digital databases provided by local providers are mainly focused on subjects related to Chinese culture, arts, history and Taiwan introduction. Digital databases and archives prepared by the National Palace Museum are well sold locally and overseas.
In Taiwan, universities and colleges, international schools, major public libraries, hospitals and research institutes are major buyers of digital databases. The procurement procedures for schools and public libraries are mainly through a tendering system.
There are 164 schools in higher education including 105 universities, 44 colleges and 15 academic colleges in Taiwan. Higher education schools with an excess of 8,000 students will continue to be the potential buyers for imported digital database. Other potential buyers of digital databases are two national libraries, six large city libraries and 72 large-sized hospitals with medical research centers and 21 state-run research centers.
In Taiwan, there are no tariffs imposed on imports of digital databases, and licensing or agency agreements are free of restrictions. To approach the Taiwan market, U.S. digital databases providers should consider partnering with Taiwan companies that have experience in promoting e-content, databases and e-libraries in the Taiwan market. They should also have a thorough understanding in government procurement tender processes. Other issues one should consider include licensing fees, royalties and copyright protection. While Taiwan is no longer on the special 301 watch list, strict enforcement of intellectual property rights laws remains a priority in trade talks between the U.S. and the Taiwan authorities.
Content and copyright agencies or importers in Taiwan have played an important role in the Taiwan digital database market handling about 85 percent of the transactions related to e-content products for foreign providers. They represent foreign providers or publishers of digital content and act as a content source and service providers to local buyers.
Computer Services & Software (CSV/CSF)
Total Market Size
Total Local Production
Imports from the U.S.
Notes: Figures are in millions of USD. The exchange rate (1USD=NTD) is NT$32.15 for 2005, NT$32.5 for
2006, and NT$32.84 for 2007. The statistics are unofficial estimates.
Taiwan’s market relies heavily on imported software. U.S. computer service providers
and software vendors have a strong reputation for providing integrated solution
capabilities and high-performance products with advanced features. However, due to
cost considerations, more and more U.S. computer service providers are partnering with
local IT service providers to better manage time to market and customization issues.
Success in Taiwan depends largely upon product localization into traditional Chinese,
business practice customization, and flexible pricing policies. U.S. market domination is
expected to continue in the foreseeable future, despite increased competition from local
and third-country suppliers.
• Business application software
• Information security solutions
• Storage solutions (hardware embedded software)
• Information system integration and consolidation solutions
• On-line learning/entertainment products and services
• Business intelligence-related applications
A new Taiwan e-Government Project will focus on the promotion and development of
new service industries and Internet applications. However, political uncertainty and the
flight of manufacturing industries have dampened investment in the software and
information services industries. The demand for legacy information technology systems
integration and enterprise-wide work flow systems is increasing. There is also
increasing demand for software that supports the manufacturing sector, improves
government workflow, and facilitates information system/platform consolidation. The
mergers of financial holding companies require considerable integration of existing
information systems, and this has stimulated the demand for software and information
services. Rising awareness and concern for information security issues are driving the
growth of the information security solutions and integration market.
The launch of Microsoft's Vista operating system will stimulate a wave of PC
replacement that will also require additional investment in business productivity software
such as Word and Excel. U.S. software manufacturers have the capability and
experience for large-scale and mission-critical software solutions that are used in the
high-tech manufacturing, banking, and financial sectors. These applications also include
data storage requirements and custom-designed business intelligence features.
The demand for business applications for small-to-medium enterprises is also
increasing. The rising popularity of on-line services such as games, shopping, music,
and video content has stimulated strong market demand for networking services. U.S.
content providers and platform developers have opportunities to work with domestic
service providers. As firms integrate Taiwan into their China operations, the demand for
robust communication links between China and Taiwan is bolstering the expansion of
high speed networking hardware, software, and services.