Putting the dot into dotcom

One of the hottest performers on the Taiwan Stock Exchange over the last three months was, unsurprisingly, an Internet player.

Since December, Systex Corp (精業股份有限公司) has climbed 42.8 percent, reaching NT$230 on Saturday. Attention has been paid to the company largely because of Systex's 33 percent holding in Kimo.com, Taiwan's largest portal site that plans to list on the NASDAQ in the US later this year.

But behind the dotcom glamour is another kind of e-company, one that does the nitty-gritty work of connecting other businesses -- such as securities brokers -- to the Web.

What's more, Systex isn't your typical Web company that's long on ambition but short on history. The firm has a 24-year track record, with an average growth rate of 35 percent per year.

By far the nation's largest computer systems integrator, Systex earned a profit of NT$7.48 billion last year, up 42.47 percent from the year before. That's compared to the combined earnings of competitors Dimerco, Ares and Proyoung, which made a total of NT$1.44 billion last year.

And industry analysts say the company shows little sign of stopping, as Taiwan's information services market is expected to grow to as much as NT$115 billion this year. E-commerce work is expected to drive a good portion of that growth, with Systex poised to claim a hefty chunk.

"Even if we only have a small portion of the pie," said Paul Kao (高照順), Systex's president, "as long as the pie is getting bigger, we benefit."

The business of providing 'solutions'

"Systex's business is providing solutions," Kao said.

As the nation's banks, securities houses and retailers begin to move their operations online, "E-commerce is offering Systex greater business opportunities," he said.

More and more firms are realizing the benefits of the Internet -- reduced transaction costs through streamlined operations -- and they are turning to integrators such as Systex for help.

Take for example the company's "e-broker" solution, which more than 17 securities houses and 50 percent of the brokerage market use. With the "e-broker" system, a broker's customers can look up company information, research stock price data and buy or sell securities over the Internet.

The system has helped brokers such as Grand Cathay Securities Corp (大華證券), which maintains

its stock trading site on the Internet at www.toptrade.com.tw.

Hellen Huang (黃怡華), of Systex's securities business division, said helping brokers offer online trade to customers was a natural extension of its core business. Presently, more than 86 percent of Taiwan's securities houses rely on Systex's stock quotation system.

Another product in the works is a computer trading system that responds to voice commands. The system, which Huang said will be ready for use this quarter, is expected to accelerate transaction speeds, as it would instantly respond to a customer's spoken buy and sell orders -- over the telephone as well as online.

When it comes to the banking business, Kao said Systex was developing software so that its clients -- which include First Bank (第一銀行), Land Bank (土地銀行), and International Commercial Bank of China (中國國際商業銀行) -- can become "banks without branches" and offer "paperless banking" over the Internet.

The solution is expected to streamline a host of paper banking transactions, such as the processing of letters of credit.