Industry chiefs warn firms to 'get netted'

Digby Jones: "No longer a case of dot.coms prevailing over traditional firms"

Industry leaders have urged business to ride the "second wave" of e-commerce in the UK, or risk floundering on the wrong side of a widening digital divide.

The Confederation of British Industry has urged executives to ignore the "new economy froth" which surrounds the launch of cutting edge websites, and concentrate on the underlying transformation prompted by the coming of the internet.

E-business is not a passing fad but is on the brink of revolutionising the UK economy

The Quiet Revolution report

While the decline of dot.com firms has continued to grab headlines, UK firms are developing their use and understanding of e-commerce in a "quiet revolution", a report from the CBI and KPMG Consulting said.

"It is getting serious now," the report said. "The effect of a second-wave e-business is being felt in companies of every size in almost every sector.

"E-business is not a passing fad but is on the brink of revolutionising the UK economy."

Only 2% of UK companies lack an internal e-mail system, and 41% report that e-business is having a large impact on their operations, the report said.

Digital divide

Although the development of e-commerce is to an extent unpredictable, businesses cannot afford to wait "until all the pieces of the new economy jigsaw are in place", KPMG chief executive Alan Buckle said.

Alan Buckle: "No second chance" for firms which miss the boat

"The choice for business is whether to risk immersion in this complex environment, or face the greater risk of missing the wave," he said.

"Over the next couple of years, I do see the danger of a digital divide developing.

"'However, it won't be a divide based on geography or on size of company, but between businesses that embrace web-based technologies... and those that don't see it or who get their strategies wrong.

"For many of the latter, there won't be a second chance," Mr Buckle added.

'Real transformation'

The days of the e-business being viewed as a separate sector to mainstream commerce "are numbered", with almost one third of firms including an executive with e-business responsibilities on the board.

CBI director general Digby Jones said: "As the doom and gloom of falls in the stock markets fades, a more real and sustainable transformation is taking place.

"E-business is no longer being seen in terms of dot.coms prevailing over 'old' traditional businesses, but in terms of a transformation of business models."

Mr Jones called for business and government to co-operate in measures to boost awareness of e-commerce, and support training in internet skills.

The report said: "There is a threat that unless the skills shortage is addressed urgently, UK development of e-business will falter in the vitally important business to business sector."

The report also called for a "serious debate" about the provision of high-speed internet services, long the subject of dispute between British Telecom, which has had a virtual monopoly in this area, and rival firms.