Cyber commerce will be so important that every company will have to get involved, according to Visa?s chief executive Carl Pascarella, despite warnings from research firm Gartner Group that many firms will find little or no pay-off from their investment.
Delivering the opening keynote address to the Internet and Electronic Commerce conference in New York, Pascarella said ?infomoney? was set to become one of the world?s central economic planks. "Banks will be on the forefront of a new information economy," he predicted.
He acknowledged that the infrastructure to support a cashless society was not in place, but pointed to recent industry alliances - such as the Secure Electronic Transaction protocol initiative from Visa and Mastercard - as proof that an electronic commerce technology architecture is being assembled.
Later the same morning, Gartner Group research director Barbara Reilly warned of the danger of being forced by industry hype into putting together an electronic commerce strategy. "This mad rush to electronic commerce will create a glut of electronic marketplaces, an over-supply of electronic tools and millions of Web sites that will not pay off in the way their owners hope," she predicted.
But she acknowledged that, such was the peer pressure in the sector, that companies could not afford to wait until the confusion the market clears - another five years at least - before making some kind of Internet commerce investment.
Reilly urged end user companies not to be deceived by the assumption that electronic commerce needs to be inextricably linked to the Internet, reminding her audience that the practice of cashless transactions began with radio and evolved though telegraphs, faxes and electronic data interchange (EDI).
A vital requirement for any company investing in electronic commerce is to formulate a clear link between the technology and the firm?s business processes. This entails drawing up a clear definition of what the company regards as ecommerce and how that impacts on day-to-day business.
"The value of electronic commerce cannot be derived from measuring the impact on IT budgets or IS productivity," explained Reilly. "Instead, its value must be determined in terms of business results."
She predicted a ?best of both worlds? scenario, in which new Internet-enabled electronic commerce methods and technologies coexist with established EDI technology, which will become embedded in Web servers.
"The Web and other Internet-based services offer a potentially huge market for EDI developers and service providers," said Reilly. "If they recognise the opportunities and the threats in time."
But there will be a shake-down in the market as many traditional EDI suppliers find themselves unable to fund the necessary technological development to compete with the Internet?s interactive qualities. Instead, this development work will be funded by new electronic marketplace players, which will acquire the old EDI firms and integrate their technology into Internet offerings.
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