The hype surrounding electronic commerce may not be unfounded after all, according to keynote speakers at a California conference on the subject. "Electronic commerce will bring about a whole new world of increasing returns in the economic model," says Jim Manzi, chairman, CEO and president of Nets. He was speaking at the ICE Expo in Anaheim this week.
Manzi, whose company crafts electronic transaction services for business-to-business commerce, agrees there is a lot of hype about what electronic commerce will bring to businesses in the next five years. But, he says, common misconceptions about how to do business online are the only roadblocks to real growth.
"Many people mistake the Internet as another broadcasting medium, when it is categorically not meant for broadcasting information," Manzi says. The real opportunity for electronic commerce lies in "narrowcasting", or targeting, certain communities with certain information, he says.
Mark Jarvis, Oracle vice-president of server marketing, agrees that Web sites will have to be personaliszed for each visitor for electronic commerce to really take off. "We are living in the age of the big server and are moving toward the ability to provide scalable and dynamic transactions inside, outside and within companies over the Internet," Jarvis says.
Another way to target specific customer tastes is to use electronic agents which search out certain information for a user depending on predefined preferences, he says.
While the two may agree that companies in the future will need to integrate electronic commerce functions into their overall business strategies in order to stay afloat, they differ on how companies will get there. Oracle, a database company from the ground up, advocates using a powerful data warehouse on the back end of a Web site which can dynamically generate content and allow employees to update information directly into the corporate database. "Until you can do real transactions based on a database, you can't do real electronic commerce," Jarvis says.
On the other hand, Nets has based its Industry.Net service and other business-to-business transaction services on two key principles: low cost universal service and narrowcasting of information, Manzi says. In order to see a wide acceptance and usage of electronic commerce, businesses will have to build a whole new market based on customised content and simple and cheap connectivity, he says.
How long will it take to build this new market? Manzi points out that it took 39 years for the telephone to gain a 30% acceptance rate among American households, while the Internet took only seven years to reach the same milestone. "It's a long-term building process," but the industry is working on Internet time, Manzi says.