In its June 24 issue, U.S.-based BusinessWeek compiled a top 100 ranking for information technology companies around the world. This year's top 10 list was dominated by Asian companies with seven; three were from the United States.
South Korea's Samsung Electronics was on top, followed by Taiwan's Quanta Computer Inc. and Hon Hai Precision Industry Co. Ltd. South Korea's KT Freetel was fourth and SK Telecom was ninth. China Mobile of Hong Kong placed sixth while Taiwan's Elitegroup Computer Systems Co. Ltd. was eighth.
The three U.S. companies were Dell Computer at fifth, Affiliated Computer Services seventh and L-3 Communications Holdings 10th. Although U.S. companies still made up 51 of the top 100, non-U.S. businesses held a record 49 spots, more than double the 23 listed in the magazine's first ranking in 1998. Taiwan alone has 11 companies on the list.
The magazine also reported that the balance of power in the technology industry is shifting with U.S. companies no longer dominant. "Asian powers are rising impressively. Companies from Taiwan, South Korea and Hong Kong grabbed seven of the top 10 spots this year. Asian companies have never had more than two in the top 10 rankings in the past four years," the magazine noted.
"The Taiwanese companies are super-efficient manufacturers that U.S. companies turn to outsourcing production when they need to save money," the magazine reported. The magazine cited Quanta and Hon Hai, both computer-components manufacturers and service providers, as companies that have adopted innovative low-priced strategies with strong management performance.
Quanta Chairman Barry Lam observed that, "IT manufacturers who provide low-cost production win out during recessions." Terry Kuo, chairman of Hon Hai, commented that aside from low-cost manufacturing, major companies must have multidimensional operations. "When a client is outsourcing, the company must be prepared to do what the client wants." The publication also reported that it would be wrong to conclude that Asian technology companies are not innovating. It cited the example of Samsung, which gained ground in the international-cellular market with its stylish mobile phones, packaged with Web-browsing and text-messaging capabilities.
To compile the Info Tech 100, BusinessWeek used financial data from Standard & Poor's. Non-U.S. tech companies were recommended by the magazine's foreign bureaus.
To qualify, companies had to have revenues of at least US$300 million. Companies whose stock prices had dropped more than 75 percent or where other developments raised questions about future performance were eliminated. Phone companies with monopoly or near-monopoly power were also dropped. These companies were then evaluated and ranked on four criteria: shareholder return, return on equity, revenue growth and total revenue.
BusinessWeek pointed out that when it first introduced the Info Tech 100 ranking in 1998, Internet companies were still booming and U.S. companies were leading the charge into the Information Age."We knew it would provide a lens through which to study the evolution of the tech industry. Little did we know how quickly and how much it would change," the magazine concluded. if we can quickly respond to new problems and make timely adjustments to new circumstances, we can look forward to a bright future with growing prosperity and freedom. As the Taiwan experience demonstrates, we can overcome even the steepest obstacles with determination, hard work, and dogged confidence.
