IN LAST 15 YEARS

Since the mid-1990s, the Internet has had a revolutionary impact on culture and commerce,
including the rise of near-instant communication by electronic mail, instant messaging, voice
over Internet Protocol (VoIP) telephone calls, two-way interactive video calls, and the World
Wide Web with its discussion forums, blogs, social networking, and online shopping sites.
The research and education community continues to develop and use advanced networks such
as NSF's very high speed Backbone Network Service (v-BNS), Internet2, and National
Lambda Rail. Increasing amounts of data are transmitted at higher and higher speeds over
fibre optic networks operating at 1-Gbit/s, 10-Gbit/s, or more. The Internet's takeover of the
global communication landscape was almost instant in historical terms: it only communicated
1% of the information flowing through two-way telecommunications networks in the year
1993, already 51% by 2000, and more than 97% of the telecommunicated information by
2007. Today the Internet continues to grow, driven by ever greater amounts of online
information, commerce, entertainment, and social networking.
In the last 15 year Internet is helping companies to lower costs dramatically across their
supply and demand chains, take their customer service into a different league, enter
new markets, create additional revenue streams and redefine their business relationships.
Internet seems to spawn new businesses and business models every day. Some of these new
businesses will, in time, become established giants, and some of them may dominate their
particular sectors. The qualities they share are a deep understanding of how technology can
serve their business strategies, a proven flair for implementing those strategies, and unlimited
ambition. A few, such as Amazon.com and E*Trade, are already on the way to achieving that
kind of success. Most, despite todays towering market capitalisations, will simply fade from
view, unable to hold on to their much-vaunted eyeballs, or turn them into solid profits that
build long-term businesses. Of the entirely new business models made possible by the
Internet, it is the infomediaries that have the potential to be both highly profitable and
difficult for rivals to dislodge. They can also vastly improve the efficiency of even low-
tech vertical markets, such as road haulage or steel. But impressive though these
fiercely entrepreneurial firms may be (and downright terrifying for some of the old-
fashioned bricks-and-mortar companies whose necks they are breathing down), they are just
a harbinger of what is coming.
All in all, then, e-business is far more about strategy than about technology. Early
e-commerce companies have used their understanding of the technologys potential and the
absence of any baggage to steal a march and enter markets that would previously have been
closed to them, but in future simply having a good business idea and being technologically
smart is unlikely to be enough.
The big battalions of global business have taken a little longer to see the opportunity and
work out how to adapt their multi-layered supply chains and diverse distribution channels, to
say nothing of their melange of legacy IT systems or their inherently conservative customers.
But they are getting there now, and it is they and their customers, not the Internet start-ups,
that will increasingly define what e-business means. Because the main actors will be
established rather than new businesses, the process will feel more like a highly telescoped
evolution than a revolution. But revolutions come and go; evolution sticks. The ways in
which the Internet is changing the world may be less spectacular than some of its enthusiasts
might wish, but a good deal more profound.
LANGUAGE AND CULTURE BARRIERS

The Web promises to reinforce the trend toward English as the lingua franca of commerce.
There are significant obstacles in translating Chinese and Japanese to the computer,
especially the large number of local dialects. In addition, the importance of vocal intonations
in these spoken languages may further impede the transfer of business dialogue from voice to
text.
Very few MNCs offer translations of their Web site content into local languages. Several
translation services have opened on the Internet. In addition, exposure itself raises
opportunities. For example, a Japanese company recently approached CatalogSite, an
Internet-based mall of catalogs to translate many of its catalogs into Japanese. One
enterprising European on-line service based in Sardinia, Video On Line, is quickly expanding
its user base by focusing on local content in local languages. The company overcomes the
prohibitive costs of telephone use for Europeans by providing direct access through three
high-speed dedicated lines between Sardinia, Stockholm, and the United States. Owner
Nicola Grauso plans to expand from Sardinia and Italy to thirty countries in four continents,
offering local language content in each, including more than a dozen African dialects.
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However, cultural barriers remain. When setting up a traditional business operation in a
foreign country, managers usually have numerous conversations with local partners and visit
the country several times. With a virtual business, the need for such contacts is minimized,
and cultural differences may not be as apparent. To avoid cultural pitfalls, many small
entrepreneurs without broad contacts use Internet discussion groups to become familiar with
local customs, trends, and laws.





AT PRESENT
The Internet promises to be an efficient new medium for conducting worldwide market
research. Marketers can test both new product concepts and advertising copy over the Internet
for instant feedback. They can also test varying levels of customer support to help managers
define country market priorities and adapt the marketing mix. Marketers can also establish
worldwide consumer panels to test proposed marketing programs across national, regional, or
cross-cultural samples. Tracking individual customer behavior and preferences will become
easier over time. Requesting customers consent to monitor such data may prove superior to
existing methods of gathering or buying customer information, since the site visitors who
voluntarily provide information are likely to be high-potential customers. Moreover, the
Internet permits new types of measurement tools that will expand the data available to
marketers, including:
On-line Surveys. Marketers can post surveys on sites and offer incentives for participation.
Internet surveys are more powerful than mail surveys because of the mediums branching
capabilities (asking different questions based on previous answers) and are cheaper than
either mail or phone surveys.
Bulletin Boards. On-line bulletin boards are much like the traditional cork board, except that
the software enables threading messages, so readers can follow a conversation and easily
check responses to each posting. Companies can monitor and participate in such group
discussions in many countries simultaneously.
Web Visitor Tracking. Servers automatically collect data on the paths that visitors travel
while in the site, including time spent at each page. Marketers can assess the value of the
information and correlate the observed traffic patterns with purchase behaviour.
Advertising Measurement. Since servers automatically record the link through which each
Web visitor enters a site, marketers can accurately assess the traffic, as well as sales,
generated by links placed on other Web sites.
Customer Identification Systems. Both business-to-business and consumer marketers are
installing registration procedures that enable them to identify individuals and track purchases
over time, creating a virtual panel.
E-mail Marketing Lists. Many sites ask customers to sign up voluntarily on a mailing list for
company news. The audience generated appears very different from that garnered through
traditional direct marketing. Internationally, information can be disseminated quickly to the
audiences on these lists at minimal cost.






Some governments in Asia have aggressively led in development of the Internet
infrastructure in their countries to further economic growth and to retain control over external
access and internal usage. China Web actively promotes cross-border marketing by Chinese
companies, highlighting how conducting business on the Internet can reduce costs and help
companies reach specialized market segments in diverse geographical locations. China Web
also offers links to the Shanghai Stock Exchange, with daily updated stock quotes; the
Pudong Investment Center, with information on Pudongs special economic zone; Air China,
with online booking for its flights; a travel agency that offers additional travel arrangements
within China; a career directory; and an e-mail database of exporters. The government of the
Peoples Republic of China actively solicits corporate sponsorships by luring companies with
the possibility of reaching Chinese people in the United States. However, ChinavWeb does
not offer similar opportunities to foreign marketers seeking access to Chinese consumers.
The United Nations has established a Global Trade Point Network that assists small and
medium-size companies eager to expand globally by linking interested entrepreneurs with
information resources on trade regulations, trade associations, and local markets. Similarly,
the Hong Kong Trade Development Council has established a computerized Trade Enquiry
Service that matches overseas buyers with Hong Kong manufacturers and traders in a range
of industries. The current database includes more than 320,000 importers, 140,000 Chinese
businesses, and 70,000 Hong Kong manufacturers, classified by name, country, and product.
Such government-sponsored megasites are more common in Europe and Asia than in the
United States and reflect the countries emphasis on government-led economic development.
In Europe, small businesses are likely to establish an on-line presence through regional
cooperatives and state organizations that promote local business. In the United States,
individual small businesses have rapidly exploited the new opportunities on their own. While
joint development efforts reduce costs and risks, they also limit an individual companys
freedom to innovate and invest in aggressive marketing on the Web.
Several countries have not yet signed the Bern Convention, which governs copyrights, or
enforced the 1994 GATT policies on intellectual property. China and Thailand limit internal
use of the Internet to research and academic projects. Quite recently, China has been
reevaluating its internal access policies. The government is currently exploring the use of
software that will enable it to screen the Internet information flows into, out of, and within
the country, creating its own national intranet.
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In addition, many countries in central and
eastern Europe resist the Internet because it threatens to open the culture and people to
outside influences too broadly and rapidly.
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The Internet Society Summit established an
Internet Law Task Force in spring 1995 to explore solutions to problems such as privacy,
warning labels, copyright and trademark protection, and taxation and to persuade reluctant
governments to open Internet access.
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Nonetheless, numerous issues remain to be resolved:
Defining the scope of import tariffs and export controls.
Delineating the boundaries of intellectual copyrights.
Standardizing regulations on the use and sale of personal information.
Defining the roles of national governments in limiting the inflow of ideas.
Creating cross-national laws for regulated industries such as gambling, financial services, and
liquor.
An equally daunting obstacle is the poor state of the current infrastructure and the regulation
of the telecommunications industry abroad. For example, the Czech Republics phone
company cannot yet provide leased lines with adequate transmission speeds outside Prague.
There are currently only 1.7 phones per 100 people in Africa, and little impetus and funds for
state-owned monopoly telecommunication companies to invest. In Mexico, consumers often
have to wait more than a year for phone service installation. Similar situations prevail
throughout developing countries in Eastern Europe, Asia, Latin America, and Africa and
highly regulated countries in Western Europe. These countries need to invest in better
telecommunications infrastructures and to promote internal competition before they can take
full advantage of the opportunities the Internet offers for global commerce.