Digital platforms in the Taiwan market basically belong to four categories, that is, transportation, services related to daily life, merchandise items and accommodations, and platforms for services related to daily life are expected to rank first in terms of sales revenues in 2022, according to vice president Alice Chou for Taiwan Institute of Economic Research (TIER).
Digital Economy Association Taiwan commissioned TIER to study the digital economy in Taiwan in comparison with conditions in the US, UK, and China, and recently released a study report.
In early 2022, the Internet penetrated 5.0 billion or 63% of the global population and, in particular, there were 4.65 billion users of social media around the world, equivalent to a penetration rate of 58.4%. Among main countries, the US had the highest Internet penetration rate of 95%, Europe recorded 90.6% and China 70.4%.
According to a sample survey undertaken in the US in 2020, 86% of respondents had used at least one category of digital platforms, 29% had used three categories and 18% more than three categories. The top-3 categories of digital platforms that had been most frequently used were transportation, accommodations and retail.
In Europe, the top 3 categories were P2P accommodations, P2P transportation, and on-demand household services. However, on-demand household services, including cooking, shopping for sundry goods, house cleaning, doing the laundry, and caring for children, have become the fastest growing digital economy, with sales revenues forecast to increase at a compound annual growth rate of over 50% until 2025. The total production value for all categories of digital platforms in Europe in 2025 is forecast at EUR 570 billion (US$581 billion).
The top 3 categories of digital platforms in China were services related to daily life including food deliveries, deliveries of purchased goods to homes and on-demand household services, outsourced production of products, and sharing of professional knowledge and/or skills. In the China market of digital platforms, the total sales transaction value in 2021 was estimated at CNY3,700 billion (US$573 billion).
Internet users in Taiwan use the Internet for eight hours and seven minutes a day on average, one hour longer than the global average.
Due to the impact of the coronavirus pandemic, restaurants and food service providers in Taiwan saw monthly sales revenues drop 31.6% on average during May-August 2021, with an average decrease of 17.6% for those with delivery services and 32% for those without such services.
Digital platforms in Taiwan are across domains in many cases, such as operators of car rental services do not have their own cars and those of accommodations do not own rooms or houses. This causes troubles for a single authority to administer cross-domain business as well as in the applicability of relevant regulations.
To be established in August 2022, the Ministry of Digital Development is hoped to clearly define the scopes of digital industries in Taiwan, strengthen the research on the influence of digital platforms on Taiwan’s economy and push enactment of relevant regulations and the administration concerned based on ecosystem thinking, Chou indicated.
Vice president Alice Chou for Taiwan Institute of Economic Research
Credit: Digitimes Asia, July 2022