Asia/Pacific is the company’s fastest-growing market. During 2003, TANDBERG increased sales in the region by almost 45% despite a difficult environment. The company has approximately 8-10% of the real-time video communications market in Asia/Pacific. TANDBERG anticipates that share will continue to grow, particularly in medium-to-high-end systems where larger enterprises are looking for a total video solutions provider.

The demand for real-time video communication is growing rapidly in China. Chinese communications networks are mostly IP, so businesses and government are unhindered by a legacy of ISDN protocol. Interactive video is convenient and affordable. There is also a cultural predisposition to personal, face-to-face contact in business. And in China, technologies that improve productivity are adopted enthusiastically. As Chinese companies do more business abroad, live video meetings are an increasingly accepted solution.

China is the most promising Asian market for TANDBERG. Already China is one of TANDBERG’s largest sources of revenue. During 2003, TANDBERG formed an important partnership with Chinasys, a Chinese channel partner. Also in 2003, TANDBERG won a large Chinese military installation, a major contract with the Chinese weather service and another with the nation’s railroads. Approximately 80% of the company’s business in China is government related. With government customers, the advanced security and video quality of TANDBERG solutions gives the company an advantage over competitors.

TANDBERG strengthened management in Asia/Pacific. Åsmund O. Fodstad, the company’s former Regional Director for Northern Europe, was appointed Vice President of Asia/Pacific in 2003. With seven years of TANDBERG experience, Åsmund brings leadership and product knowledge to the market. TANDBERG opened Asia/Pacific headquarters in Hong Kong. This firmly establishes TANDBERG ‘s on-the-ground presence in Asia and will help the company service customers better and take full advantage of the growing demand for TANDBERG systems. The Hong Kong office is TANDBERG ‘s first in Asia with full operational capabilities, including sales and marketing. With the new TANDBERG sales offices in Shanghai and Guangzhou as well as additional hires in Korea, Thailand and Malaysia, the company has 48 employees in the Asia/Pacific region, up considerably from only 17 in 2002.

In Australia, sales increased marginally. The company anticipates steady growth through 2004, driven largely by the company’s established partnerships and a favorable new channel partner agreement with Integrated Vision, a video specialist. Customer deployments in Australia during 2003 included BHP Billiton, Deakin University, and the University of New England.