Download Background Paper No. 28
Background Paper No. 28
Executive Summary The rapid growth in Internet access and usage has opened up a 24-hour virtual global marketplace for goods and services that is creating a revolution in the way businesses operate. This swiftly changing technology has the potential to fundamentally alter the nature of marketing, ordering, invoicing, billing, and customer service. Because the costs of entry into this new market are relatively low, it is accessible to virtually any business with the desire and creativity to exploit it.
How big is electronic commerce? Electronic commerce is in its infancy and hard data is difficult to come by. Industry estimates vary widely. According to a survey by Nielson Media Research and CommerceNet, almost seventy-nine million people over the age of sixteen used the Internet in the first six months of 1998, up 58 million from the previous nine months. Of those users, 20 million made online purchases —double the figure from the previous nine months. ‘Globally, there were more than four hundred thousand active commercial websites at the beginning of 1998,more than double the amount at the beginning of 1997.
By far the largest component of electronic commerce is business-to-business trade. In the United States, business-to-business electronic commerce is expected to top $17 billion in 1998, more than double the amount in 1997. By 2002, U.S .business-to-business sales of goods using the Internet are expected to exceed $300 billion.
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