Overview

Taiwan is a well-known ICT manufacturing hub due to its strong ICT industry base, robust semiconductor manufacturing clusters, and advanced manufacturing capacity. These advantages have enabled it to rapidly develop many companies that offer advanced ICT-related products and services especially in the sectors of electronic components, computers, fiber optic cable, telecommunications equipment, and information and communications technology. Many Taiwan companies provide Original Design Manufacturing services to U.S. ICT suppliers. Others have established strong supply chains that use U.S. suppliers as intermediaries, allowing their businesses to expand beyond Taiwan to the U.S. and other countries.

The increased utilization of 5G has helped Taiwan companies digitize their operations and allowed them to shift their focus to building up their technological strengths and make use of cloud services and big data.

A new Ministry of Digital Affairs (MODA) was established in August 2022, emphasizing the integration of telecommunications, information, cybersecurity, internet, and broadcasting to assist the local digitalization of Taiwan industries. The local demand for advanced telecommunications and cybersecurity will be increased by MODA’s new regulations, which will boost the market for U.S. companies operating in related sectors.

Leading Sub-Sectors

• 5G, Beyond 5G (B5G)
• Artificial intelligence (AI)
• Audio production equipment for broadcast and television
• Augmented reality (AR)
• Big data
• Broadcasting hardware equipment
• Business application software
• Business intelligence-related applications
• Cybersecurity software
• Cloud computing security software
• Secure cloud connectivity
• Data leakage prevention (DLP)
• Identity and access management (IAM)
• Internet of Things (IoT)
• Information security solutions
• Information systems integration and consolidation solutions
• Low Earth Orbit (LEO) telecommunications
• Metaverse
• Mobile computing
• Secure content and threat management (SCTM)
• Security and vulnerability management software (SVM)
• Storage solutions
• System and network management software
• Virtual reality (VR)
• Zero Trust

Opportunities

Cybersecurity, Software, and Computer Services

Due to fierce international competition and the move to teleworking as a result of the Covid-19 pandemic, protecting the data stored in ICT products and devices has become one of the biggest concerns for buyers. The security of ICT products and services is a top priority of buyers in Taiwan.

According to the International Data Corporation (IDC) cybersecurity-related expenditures will reach US$894 million in 2022, due in part to increased demand for mobile office and digital learning tools in Taiwan.

According to the Industrial Technology Research Institute (ITRI), Taiwan ranked first in worldwide market share for major ICT products. Taiwan public and private enterprises typically purchase software and large- scale security solutions from foreign suppliers, with after-sales service being provided by local system integrators.

The main purchased solutions are firewall, web application firewall (WAF), antivirus software, and many end point protections such as password management tools and software.

Due to its geographical position, Taiwan is a testing field for hackers that deploy a significant number of Advanced Persistent Threat (APT) attacks daily. Moreover, cyber criminals are increasingly targeting private industry by exploiting loopholes in smart manufacturing supply chains and low latency in 5G networks. Thus, cybersecurity has become a key focal point for maintaining industrial competitive advantage. MODA will enforce cybersecurity capabilities in the defense, critical infrastructure, semiconductor, and telecommunications industries.

Local demand for cybersecurity solutions has primarily focused on internet security, with many local enterprises embracing the concepts included in the U.S. National Institute of Standards and Technology (NIST) Cybersecurity Framework, including how to identify, protect, detect, respond, and recover from cyber- attacks. In 2022, the service industry was the leading sector in Taiwan for cybersecurity solutions in terms of demand, with healthcare, manufacturing, and financial services following closely behind. E-Commerce-related services for online shopping, restaurants, transportation reservations, hotel reservations, etc., will use Enterprise Resource Planning (ERP) systems for maintaining huge amounts of client data for management, and they will begin to use the cloud for data storage purposes. Due to the high volume of big data, the risk of becoming the target of cybersecurity attacks is higher than in other industries.

The Taiwan authorities are also concerned about cyber-attacks from China. According to the Taiwan National Security Council, U.S. software companies are welcome and encouraged to participate in public tenders. For tenders from Taiwan’s National Security Council, National Security Bureau, and the Ministry of National Defense, none of the software or hardware can be sourced from China. In January 2019, the Taiwan Cyber Security Management Act (the Act) went into effect to regulate central and local authorities, public organizations, and critical infrastructure providers. More broadly, the Act has raised awareness of the need for manufacturers to invest in additional cybersecurity tools and attract foreign technology firms to Taiwan.

To promote U.S. cybersecurity companies in Taiwan, GM Taiwan will lead a delegation of representatives from the Taiwan authorities, critical infrastructure providers, and private sectors to the RSA Conference in San Francisco, CA, April 24-27, 2023. GM Taiwan also regularly hosts cybersecurity events for U.S. companies to participate and promote their solutions.

5G Next Generation Telecommunications

GM Taiwan is assisting U.S. telecom software companies to form new joint solutions for 5G with Taiwan telecom hardware suppliers. The telecommunications sector is evolving from traditional network stacks to a flat architecture that will enable flexibly, scalability, automation, and intelligence at the edge of the network. Next-Generation networks, such as 5G, are becoming software-defined, virtualized systems based on cloud- based architectures. Combined with other enabling technologies such as artificial intelligence/machine learning, multi-access edge computing, and heterogenous radio access technologies, the next evolution in wireless connectivity presents significant opportunities for potential binational applications. Due to its high- speed, low-latency broadband Internet connectivity factors, LEO telecommunications services (also called 6G) are being included in one of Taiwan authorities’ communication programs. Beyond its use for the defense industry, LEO services will also integrate with networks to manage connectivity to cars, vessels, airplanes and other IoT devices.

The concept of forming new joint telecommunications applications has attracted the attention of Taiwan hardware suppliers, as these solutions could eventually be exported to other countries. Together with FCC and NTIA, GM Taiwan is promoting the Infrastructure Investment and Jobs Act (IIJA) to Taiwan telecom industries for participating in tenders from IIJA’s $1.2 trillion tender programs. The bill also includes a $65 billion investment in broadband infrastructure deployment to help reach America’s more remote rural areas.

Resources

Trade Shows

CS Taipei will lead Taiwan business delegations to the following upcoming ICT-related trade shows in the United States for matchmaking opportunities:

• RSA Conference USA, San Francisco, CA: April 24-27, 2023
• SelectUSA Investment Summit, National Harbor, MD: May 1-4, 2023

In 2023, the following ICT-related local trade shows will be held in Taipei, Taiwan:

• Taipei Smart City Summit and Expo, March 28-31, 2023
• Cybersec Forum, May, Date TBD

Relevant Authorities

• Ministry of Digital Affairs (MODA)
• National Science and Technology Council (NSTC)
• Executive Yuan (EY)
• Industrial Technology Research Institute (ITRI)
• Information Service Industry Association of R.O.C.
• Institute for Information Industry (III)
• iThome
• Market Intelligence and Consulting Institute (MIC)
• Ministry of Culture (MOC)
• Ministry of Economic Affairs (MOEA)
• National Center for Cyber Security Technology (NCCST)
• National Communications Commission (NCC)
• Taipei Computer Association (TCA)
• Taiwan Electrical and Electronics Manufacturers’ Association (TEEMA)

U.S. firms interested in learning more about the cybersecurity and telecommunications market and seeking to expand their export opportunities to Taiwan are encouraged to contact CS Taiwan Commercial Specialist Rita Chen at Rita.Chen@trade.gov.