Asia Pacific SMBs Spent over 84 Billion on IT -Excluding Telecom-, Last Year, Added 632,000 New Businesses and AMI-Partners Predicts Explosive Growth in Next Five Years.

Business Editors/High-Tech Writers

NEW YORK--(BUSINESS WIRE)--March 11, 2004

AMI-Partners, Inc.

- Small and Medium Businesses in the Asia Pacific Market

(Excluding Japan) IT Spending and Adoption Will Experience

Enormous Growth, Outpacing North America, Latin America and

Western European IT Markets

- Key Drivers of IT Spending Include Internet Infrastructure,

Wireless Networking, Storage, Security and Customer-Centric

Enterprise Applications

Asia Pacific SMBs surged ahead, hiring new employees and increasing spending on IT. There are currently over 27 million small and medium businesses in the Asia Pacific market, which represents an increase of over 632,800 over last year. The previously under-saturated SB market made strong strides in adopting new and advanced IT products and solutions, encompassing Virtual Private Networks (VPNs), Networking Storage, Wireless LAN, Intrusion Detection, Firewalls and Customer-Focused Enterprise Applications. Overall, spending on IT by Asia Pacific SMBs grew by 16% from 2002 to 2003, registering $84 billion.

The above findings were released today by New York-based Access Markets International (AMI) Partners, Inc., a leading consulting firm specializing in IT, Internet, Telecom and business services market intelligence, trends and strategy with a strong focus on global small and medium business (SMB) enterprises. AMI conducts the IT industry's most comprehensive annual tracking surveys of SMBs in several countries including the U.S., France, Germany, U.K., Australia, China, India, Japan, South Korea, Singapore, Brazil and Mexico.

Expansion of work force with a positive outlook for next 12 months

"The economic picture looks bright for Asia Pacific SBs. Most companies are experiencing an increase in revenues and are planning to add additional branches," said Anurag Agrawal, COO at AMI-Partners. According to the AMI study, over 63% of all China PC SBs indicated an average increase of 8% in their annual revenues over the prior year and 83% anticipate revenue increases over the next twelve months. In addition, 18% of China PC SBs plan to open additional branches next year. "A similar picture can be seen in the India market. 80% of India PC SBs indicated an average increase of 10% in their annual revenues over the prior year, with 77% expecting revenue increases of 11% over the next twelve months," added Agrawal. The AMI study also revealed that China PC SBs plan to expand their workforce by 1.2 million employees, while India PC SBs are expected to hire an additional 746,000 people next year. In comparison, U.S. SBs increased their workforce by 5% over the last twelve months, adding 382,000 people.

A growing awareness/ adoption of a range of security solutions

Security-solution providers covering anti-virus, firewalls, intrusion detection and managed security have benefited significantly from a growing awareness of these solutions among small and medium businesses in the AP region. The total spend on IT security solutions by SMBs in Asia/Pacific reached $1.4 billion. In order to address their security concerns, approximately 61% of Australia SBs with LANs currently use on-site data backup and recovery solutions, while 17% of them are currently able to check for systems/power redundancy for disaster recovery.

Affordable network storage solutions gain popularity in SB market

Asia Pacific SMBs are rapidly adopting solutions that are appropriately scaled for that market. SMBs spent over $340 million on SAS and DAS solutions last year, representing an increase in expenditures of 32% and 14% respectively, over the last twelve months. AMI-Partners' studies reveal that the number of AP SMBs deploying SAN/NAS storage solutions increased by a staggering 50% over last year, an indication that the drop in SAN/NAS prices coupled by enhancements in infrastructure-friendly IP-based SAN solutions were welcomed by the IT savvy segment of the SMB market. According to AMI, the largest growth, from 2003 to 2008 in SAN/NAS solutions will occur in India, followed closely by China and Korea. The SMB market clearly represents a lucrative opportunity for storage solution providers who are re-modeling their products in order to cater to the needs of this segment. The growing use of media intensive applications, such as imaging and document management, and streaming video lead to the accumulation of massive amounts of digitized media that require storage facilities. AMI estimates SMBs spent roughly $0.62 billion on hardware storage solutions, a significant 36% increase from 2002.

Spending on networking and connectivity soars as SMBs aim to keep current with emerging technologies

SMBs are looking to implement solutions that will enhance the intelligence and scalability of their network in the most cost effective way. Burgeoning interest in wireless LANs and the increasing need for VPNs have caused SMBs to refocus their investments in networking-related spending, which reached a high of $5.6 billion in 2003. Wireless LAN deployment increased by 49% over the last year as SMBs strived to enhance the functionality of their regular office LANs. This explosion in adoption is apparent as SMBs spent roughly $0.22 billion on wireless LAN and other wireless solutions in 2003, a 132% hike over the total amount spent last year. The number of businesses using VPNs more than doubled over the last 12 months, as SMBs finally perceive VPNs to be a secure and reliable form of communication. Asia/Pacific SMBs spent over $260 million on VPN solutions. The Asia Pacific market is also investing in broadband deployment. Rapidly falling prices allowed DSL and Cable Modem Internet access to command 73% and 45% year-over-year growth, respectively with the total spending on broadband solutions crossing $5.0 billion. Apart from this, enhancing employee productivity and reducing latency between transactions will drive a significant amount of investment in upgrading enterprise Intranets over the next 12 months.

Surge in business process automation applications (CRM/SFA/ERP/SCM)

AMI-Partners' survey results indicate that SMBs are deploying enterprise software applications in order to retain and grow their customer base and optimize business processes. With the efforts of companies releasing affordable software applications catered specifically for the SMB market, spending on such products increased considerably since 2002, reaching a total of $190 million in 2003. There was over a 20% year-over-year growth in the number of businesses using CRM/SFA applications and the need to establish electronic linkages with larger companies ensured that ERP/SCM deployment increased by 29% over last year. The shift towards automating existing transactions with suppliers and customers indicates that enterprise software applications will continue to be a 'hotspot' among Asia Pacific SMBs.

About Access Markets International (AMI) Partners, Inc. (AMI-Partners)

AMI-Partners specializes in IT, Internet, telecommunications and business services strategy, venture capital and actionable market intelligence - focusing on global small and medium business (SMB) enterprises. The AMI-Partners mission is to empower the firm's clients for success with the highest quality data, business planning and "go-to-market" solutions. AMI-Partners was founded in 1996 under the name of Access Media International (USA), Inc. (AMI-USA) by Andy Bose, formerly a group vice president at IDC. Since its inception, the firm has built a world-class management team spanning 10 to 25 years in IT, telecommunications, online communications, and multimedia. The team is comprised of individuals who formerly built careers at leading industry-companies such as ADP, Cablevision, Compaq, IBM, IDC, Gartner, McKinsey, and other major corporations.

AMI-Partners has helped shape the go-to-market SMB strategies of more than 130 leading IT, Internet, Telecom and business services companies in the last seven years. The firm is well known for its IT and Internet-adoption-based segmentation of the SMB markets; its annual retainership services based on global SMB tracking surveys; and its proprietary database of several thousand SMBs in the U.S., Europe, Asia-Pacific and Latin America. The firm invests significantly in collecting survey-based information with several thousand SMBs globally through the industry's most comprehensive SMB survey instrument, and is considered to be the leading benchmark for tracking SMB trends.

For more information on AMI-Partners or our Global SMB surveys please visit www.ami-partners.com or call 212-944-5100.