NZ needs e-commerce wake-up call

New Zealand business needs an electronic commerce wake-up call, says Wellington-based Deloitte & Touche Consulting partner Paul Gadd. He says New Zealand has not recognised the global market.

New Zealand business needs an electronic commerce wake-up call, says Wellington-based Deloitte & Touche Consulting partner Paul Gadd.

Following the release of the firm's report about the evolution of electronic business, Gadd made some hard-hitting remarks about local approaches to e-commerce. Making similar comments last year, Gadd warned that New Zealand could "miss the boat" if it does not take advantage of global e-commerce opportunities. He says nothing has changed since he last spoke.

The latest report - "The new economics of Transactions" - is based on global information. However, Gadd says much of the information in the report doesn't apply to New Zealand, because the country is lagging behind in the market.

"The view taken in the report is that it's very much a global market. New Zealand is still trying to develop e-business solutions that target and sell New Zealand goods to a New Zealand population."

He says the report should prompt New Zealand business to change its thinking.

"Anybody with a PC is now your potential customer. The way people are going to shop is going to be quite different - but we're not thinking that way."

Gadd says this could be due to geographical isolation, narrow thinking and people skilled in this area going overseas. Firms that are looking beyond New Zealand's shores are only trying to get 10% more sales, when the potential is a lot higher, he says.

The report says that by next year over 200 million users will be connected to the Internet, and forecasts about the growth of e-commerce will keep being revised.

Key findings include:

• Internet-based software agents called "shop bots" will in future search for products, compare prices, conduct transaction and arrange for delivery to consumers.

• Certain types of products will morph into digital bits to be transported to consumers (this is already happening with software and publications and the next wave is music).

• Internet transactions will alter the traditional form of money, as security and privacy solutions allow for extensive use of digital cash.

• Commerce service providers (CSPs) will replace ISPs, priority service pricing protocols will be introduced and XML and XSL will replace HTML.

• Governments will revise the taxation of transactions to deal with the inadequacy of traditional assessment and collection methods, as companies use cyberspace to save money.

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