The Internet buzz

E-commerce, e-business, e-just-about-anything is hot. Businesses of all sorts are surfing the Internet wave to develop new ways of buying, selling, and reaching potential consumers as well as other businesses. But don't take our word for it. Here is a brief review of what others have to say about the phenomenom:

U.S. business-to-business e-commerce will hit $2.7 trillion in 2004, predicts Forrester Research Inc. (Cambridge, MA), an independent emerging-technology research firm. This growth will be accelerated by the rapid development of "e-marketplaces"-new models for conducting e-commerce, including auctions, aggregators, bid systems, and exchanges. By 2004, Forrester expects, these eMarketplaces will capture 53% of all online business trade.

For a fuller explanation of the report, go to www.forester.com.

"...Maybe it's time to drop the "E" from E-business and acknowledge that soon-sooner than anyone expected-all business, or at least a part of every business process, will be conducted online... 'This is Manifest Destiny,'" says Yobie Benjamin, Ernst & Young's chief global strategist for e-commerce, who works with clients such as American Express, Coca-Cola, General Motors, Johnson & Johnson, and Merrill Lynch. And so say many like him. In the article, "Putting The 'E' Back In Business," authors Clinton Wilder and Marianne Kolbasuk McGee stress the importance of recognizing that sometime very soon, e-business will be nothing more than "business as usual." The article highlights several case studies including companies such as Goodyear, Toshiba, and Whirlpool, that integrated the Web into various business stages-from product development to supplier negotiations to volume sales.

Texas Instruments' online procurement project, for example, is changing the company's approach to purchase approvals. Instead of routing every employee requisition to managers for approval beforehand, the new system automatically approves all purchases below a specified limit, and notifies management of the transaction when it sends it to the vendor via the Web.

In a companion article, "E-Business Makes General Electric A Different Company," GE comments that e-enabling business processes are its highest priority. "By the middle of this year, people will look at this company and say it's a very different company than it was five years ago," says senior VP and CIO Gary Reiner. GE's e-business initiative is four-pronged: the sell side (customers), the buy side (suppliers), the investment business, and internal processes. But has it worked? The company cites the experience a subsidiary of GE Plastics, Polymerland (Huntersville, N.C.), has had. The subsidiary sells raw plastics to plastic-products manufacturers. When Polymerland.com launched its pilot in 1997 as a secure website for customers to buy products online, the company sold less than $10,000 worth of plastics per week and had fewer than 10 regular customers. The site now has about 900 customers and supports sales of about $1.5 million per day.

In addition to sales, there are other benefits. Polymerland's salespeople can watch buying patterns to see if business from a specific customer is slacking off and then try to determine why, court new customers, or make special offers to loyal ones.

To see the full text, go to www.informationweek.com.

According to CommerceNet, a global non-profit membership organization for companies doing electronic commerce, the number of Internet users in North America has now reached 92 million, and the commercial growth of the Web is emerging as a dominant trend in the development of the Internet. According to a study by CommerceNet and Nielsen Media Research, the number of Internet users age 16 and older in the U.S. and Canada increased 16% in just nine months, yet the number of online consumers jumped 40% to 28 million during the same period. Women, for the first time, are driving this increased adoption of the Internet as the number of female consumers online jumped 80% in nine months, and passed the 10-million mark. "More than 2 of every 5 people in North America are now Internet users, and the Web is becoming an integral part of daily life," says Mark Resch, executive vice president of CommerceNet. "With more than 30% of users being Internet consumers, we're seeing a tidal wave of e-commerce in North America."

For the full text, see www.commerce.net

In 1998, the Internet economy generated $301 billion in U.S. revenue. This figure, along with a work force of 1.2 million people, puts the Internet in the same macroeconomic neighborhood as cars ($350 billion) and telecommunications ($270 billion). These figures, released by a University of Texas study funded by Cisco Systems, are cited in "The B-to-B Boom: Let's Get Vertical," by Mohanbir Sawhney and Steven Kaplan. The article deconstructs the new business models and discusses the importance of electronic marketplaces or hubs that will focus on specific industry verticals or specific business processes such as spare airplane parts. The article discusses the pros and cons of various hub models and architectures.

For the full text, visit www.business2.com/articles/1999/09/text/models.html

The other side of the story. Okay, so all these say great things about the Internet. But there are always two sides to every story. Let's balance it out just a bit with two more cautionary articles.

In an in depth and economically technological paper entitled "E-commerce: The 8 Corners or 8 Ways a Blind Wise Man can Look at the Elephant," the author, John Sumser, CEO of Internet Business Network, says that a web page for a web page's sake is a mistake. He writes, "In the rush to put businesses and other organization 'on the Web,' an astounding amount of money, passion, and energy has been invested in the development of public relations nightmares that are not integrated with their core businesses and, in fact, tug the business away from its core capabilities." He highlights two common mistaken assumptions: that the Web is somehow a single marketplace, and that a technology is the same as an applied technology. Then he goes on to present a matrix that describes the extremes of e-commerce with explanations and examples.

For the full text, visit www.interbiznet.com/nomad1/ecom/

And in an editorial for ZDNet's Online Newsletter, entitled "The Fragility of Electronic Information in the New Millennium," the author cautions against relying too heavily on electronic information and trade. While the author may be a bit of a doomsayer, he raises several valid points, such as the need for archiving and the rate of advances in computers. Emerging technologies mean that the machines that can read stored information today will become obsolete in a few years, making archived information difficult, if not impossible to retrieve. Also, natural disasters, sunspots, power outages, or even electrical surges could potentially wipe out central computer systems and databases.

For other disasters, and the full text, see www.zdnet.com, Computer Magazine Archive. You may have to register before using the site.

According to "Why E-commerce Lags in Europe," by Beth Cox, only 4% of households in France, Germany, Netherlands, Sweden, and the UK have purchased online in the past three months, largely due to lack of experience and security concerns (www.internetnews.com/ec-news/article/0,1087,4_300231,00.html).

But because of lag, global Internet entrepreneurs predict that 2000 will be a big year for that part of the world. In an interview for Planet Web, Charles Cohen, founder of Beenz.com, says, "2000 will be a boom year in e-Europe. Two things are going to make a big difference: telecom deregulation will bring people and investment online, and the euro will make e-business in Europe too compelling to ignore." Esther Dyson, chairman of EDventure Holdings, says: "In Europe, and especially Eastern Europe, the Net will...have a greater impact [than in the U.S.], since their economies are relatively inefficient and the Net will bring more consumer choice, more competitive pricing, and other benefits we take for granted in the U.S. Wireless will expand rapidly in Europe and will be a major means of Net access-easier to use, cheaper [relatively] than PCs, and more widely accessible."

For an international look at the future of e-commerce, see the full text of "What's in store for the Net in 2000?" by Planet Web, www.planetweb.com.