European businesses do not believe that the recent glut of dot com start-ups will pose a serious threat to their traditional businesses, although many are setting up websites as a purely defensive measure.
A new survey by Pricewaterhouse Coopers of 100 senior managers from Europe's top 1,000 companies indicated that only seven per cent of respondents were using ebusiness as a vehicle to move into new sectors.
Just 25 per cent claimed they faced competition from the websites of their traditional rivals, while only 15 per cent viewed pure Internet companies as their greatest challenge.
Andy Zimmerman, PricewaterhouseCoopers' global ebusiness leader, said: "This research indicates that most European businesses are taking a defensive stance that pays lip service to the Internet and fails to maximise its full potential."
He added that European firms also did not believe that creating a different brand for their Web activities would make any difference, with 86 per cent saying they would rely entirely on their existing brands or would simply adapt them.
But Zimmerman said he believed this was a shortsighted attitude because Web consumers, and in particular younger people, were not necessarily loyal to traditional brands. He pointed to the example of Disney's Go Network brand, which pulls in the sixth largest Web audience, while its other site, which uses the traditional Disney name, trails behind in thirtieth place.
The survey also found that only four per cent of organisations were currently investing more than 10 per cent of revenues in ebusiness development. But Zimmerman also believes this may harm European firms because it indicates they do not appreciate the power bestowed on pure Internet companies by their vast market capitalisa tions.
He concluded: "European businesses have reached a point of no return - they must embrace a new business model centred around a proactive ebusiness strategy. Only by doing so will they realise their ebusiness ambitions."
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