The Asia-Pacific region includes economies at polar opposites of the online development spectrum. Australia, Japan and South Korea have advanced digital infrastructures with mature e-commerce and online travel sectors, according to Jeffrey Grau, eMarketer senior analyst and author of the new report, Asia-Pacific Online Travel: Focus on China and India.


"At the other end of the spectrum, while countries such as Vietnam, Indonesia and Malaysia are less developed, they are growing fast," he said.

But the real action lies in the middle.

"It is the massive online travel markets of China and India that will drive growth in the region," Mr. Grau said.

eMarketer estimates that online travel bookings in China were worth $1.5 billion in 2006, and it projects that average annual increases of 60% will push the Chinese market to $15.4 billion in 2011.



"Expansion in China will be underpinned by meteoric economic growth, relaxation of overseas travel restrictions and a fast-growing Internet user population," Mr. Grau said.

In India, eMarketer projects that the online travel market will grow an average of 46% annually from 2007 to reach $4 billion in 2011.

"In India," Mr. Grau said, "the growing middle class has become more comfortable buying railway and budget airline tickets online, and a slew of online travel agencies have been established to meet growing demand."

Despite these exceptional growth rates, Mr. Grau warned that much work needs to be done before these countries reach their full potential.

"The percentage of the population online in India is a dismal 2%, and in China the rate is only 10%," he said. "By comparison, Internet penetration in South Korea is 71% and 68% in Japan."