While Internet usage continues to surge worldwide, analysts and industry executives at the Internet Commerce Expo acknowledged this week that many countries outside of the US still face serious barriers to widespread connectivity. "Many people are not aware of the aggressive growth of full-service Internet service providers in Europe, Asia and Latin America. However, these regions still have a long way to go before their people see the Internet as a necessary part of daily life," says Tom Wyrick, director of business solutions for Global One. Wyrick was part of a panel discussion on the Internet's international growth potential.
Some of the roadblocks that developing countries may face when attempting to set up global Internet networks are high costs of fibre-optic cable, governments that censor information and restrict access to certain individuals and a lack of perceived need for the Internet in daily life, Wyrick says.
"We need to be politically and culturally sensitive to these countries' concerns," he says.
Analysts agree that the Internet is far from a truly global phenomenon. International Data has predicted that more than 163 million users worldwide will have access to the Web by the year 2000, compared to only 34.6 million today. However non-US-based usage won't surpass 51% of total Web access until the year 2000, says John Gantz, senior vice-president at IDC, during a presentation on the Internet market outlook.
In addition, US consumers are expected to generate over 50% of the US$100 billion electronic commerce industry forecasted for the year 2000, Gantz says. By the turn of the century, 50% of PCs worldwide will have Internet access, while that number is expected to reach 76% within the US, according to IDC.
GlobalOne, which has set up Internet services in more than 24 countries, has predicted that 72% of Internet usage happens within the US, with Europe trailing at 23%. Still, the company is confident overseas companies will catch up. "We're beginning to see international Internet traffic shift away from viewing sites based in the US," Wyrick says.
Currently, about 80% of global Internet users access World Wide Web sites based in the US, but over the next two or three years, GlobalOne expects this number to drop to 60% as more localised content is created on the Web, Wyrick says.
In addition, smaller countries are setting up sophisticated Internet backbones at an increasing rate, Wyrick says. Countries such as Botswana, Jordan, Ethiopia, Vietnam and Honduras have set up networks based on GlobalOne's products over the last year, he says. "Almost every country in the world today recognises that the Internet is critical to their economic and social development," Wyrick says.
Intranets that connect international businesses are fueling a lot of the demand for international Internet connectivity, says Michael Sullivan-Trainor, Internet research director for IDC. While many large international corporations are developing Web sites and internal intranets, they are not achieving the productivity goals they had hoped, Sullivan-Trainor says.
Sixty percent of Fortune 500 companies surveyed say they had hoped their intranet would increase productivity, with the other 40% citing various goals including improved data access and lower development costs. However, only 16% say these goals had been reached.
Still, many companies remain optimistic that the Internet will prove a golden business opportunity. One expo attendee says he was there to find out about ways to connect his sales forces in Germany, Canada, Australia and the US over an intranet and was impressed with the "sophisticated technology and intuitive interfaces" of the electronic commerce products vendors were plying at the show.
"Once cost goes down, and security goes up -- maybe in a year or two -- we will expand our intranet to accommodate electronic commerce between our business and consumer customers," says Eric Holmgren, vice-president of marketing for Exprex Group, a hospitality and medical services company based in Newport Beach, California.