Internet and various kinds of enterprise software. But they have been slow to adopt, or are skeptical of, more advanced digital technologies like social media and analytics.
20%by 2020 5. 0%(2012) Regular internet usage overall Among disadvantaged people 75%by 2015 60%by 2015 60%by 2020 45%by 2020 45.0
%(2013) 24.0%(2012) Population that has used never the internet 15%by 2015 30%by 2020 48.0%(2012) Citizens using egovernment Returning completed forms 50%by 2015 25%by 2015 35%by 2020 20%by 2020 5. 0%(2013) 2
and energy sustainability Fighting poverty and social exclusion Population to buy online Population to buy online cross-border SME's to make online sales Population that has used never the internet Citizens using egovernment Returning completed
Climate change and energy sustainability Education Fighting poverty and social exclusion Covered by broadband Covered by broadband above 30 Mbps Subscriptions to fixed broadband above 100 Mbps Regular internet
disadvantaged people Population that has used never the internet Key cross-border public services, online 4. 2. Improving social inclusion through access to broadband ICT infrastructure IV-Fast and ultra-fast internet access Whereas the strategy was developed by the Ministry for Information Society,
Paper document (physical environment) Digital documents Points of access to governmental web Websites located on Internet Ministry for Information Society (responsible) All Ministries offering public services
and relevant infrastructure in schools Ministry of Education (responsible) Ministry for Information Society (support) ICT in Education%individuals using the internet regularly.
75%by 2020%individuals from the category of those disfavored using the internet. Target: 50%by 2020%of pupils trained with TIC skill.
and Internet usage at the regional level Promoting the system of learning together Involvement of HR services within companies and public organizations:
and Internet usage at the regional level Promoting the system of learning together Involvement of HR services within companies and public organizations:
Ministry of Labor (responsible) Ministry for Information Society (support) einclusion%individuals using the internet regularly.
75%by 2020%individuals from the category of those disfavored using the internet. Target: 50%by 2020%of individuals who have used never the internet.
Target: To be defined based on Appendix 5 Methodology%of pupils trained with TIC skill. Target: 75%by 2020%education facilities using OER, Web 2. 0 in education.
25%by 2020%individuals who use the internet to order goods and services from other countries members of the UE.
10%by 2020%individuals who use the internet to order goods and services. Target: 30%by 2020#of competency centers developed on a regional level.
To be defined based on Appendix 5 Methodology#of households with access to internet broadband (at least 30mbps) Target:
BIG DATA AND SOCIAL MEDIA 2. 1 EGOVERNMENT AND INTEROPERABILITY 2. 1. 1 Introduction Preamble The combination of the use of advanced ICT, especially the Internet,
it is important not to limit the scope of this initiative to a restrictive definition of delivering transactional public services over the Internet,
%internet subscribers in fixed line and%broadband subscribers) the index of human capital (generated depending on the education level noticed on adults and%of school enrolments).
European commission Strategy http://ec. europa. eu/digital-agenda/en/news/eu-cybersecurity-plan-protect-open-internet-and-online-freedom-and-opportunity-cybersecurity In its Pillar III
45%of the Romanian users use the Internet at least once a week 52%of the Romanian users are at least fairly confident in buying online
Operative Council for Cyber security (COSC) Development of educational programs (Enabler) Educational programs in the forms of compulsory education on the safe use of the Internet and computing equipment Responsible:
Social media, together with the wider internet have become useful business tools in other countries, currently helping governments to be part of the conversation.
However, there is also a generational split as younger people use the Internet less outside social networking sites in all Member States,
Based on a study published by Eurostat in December 2012,73%of Romanians are using the internet to read newspapers online.
Posting messages on social media occupies with 48%the second place in the classification of the motivation for using the internet,
creation of a website and internet banking, the last reason being claimed only by 8%of users.
Paper document (physical environment) Digital documents Points of access to governmental web Websites located on Internet Social media Operational systems available The information provided by Big data systems does not include personal information
Paper document (physical environment) Digital documents Points of access to governmental web Websites located on Internet Social media Operational systems available (Operational) Definition of the analysis process for the data
computers, the Internet, broadcasting technologies and telephony. The benefits are translated into improvement in efficiency and effectiveness of education at all levels
and in both formal and non-formal settings. 3. 1. 2 European context An advanced digital society requires that most citizens can regularly access the Internet and benefit from the opportunities if offers.
and 60%of people in disadvantaged groups using the Internet on a regular basis, and of reducing the percentage of population that has used never it to below 15%.
and the Internet in the learning process is the pupil access to these technologies. Besides the horizontal measures of improvement in the number of broadband connections, development of digital infrastructure and increase of digital inclusion, the best practices show as appropriate the direct intervention in education, an acceleration factor of digitalization
Interactive visual materials and additional sources of information provided by the Internet will increase student engagement.
which are listed below regular telephone lines, Internet, Intranet and satellites. Telemedicine is used by the suppliers in a more and more increased number of medical specialties
including-but not limited to the following listing-regular phone lines, Internet, Intranet and satellites. Telemedicine is used by providers in an increasing number of specialties including dermatology, oncology, radiology, surgery, cardiology and psychiatry.
and upload them on the Internet. This investment has led to an unprecedented period of technical research and development in the European cultural heritage sector,
With more than 80 000 visually impaired people living in Romania, the Iasi County Public library approached the Biblionet Romania programme (including voice recognition software and other specialized Internet functions and capabilities
browsing the Internet, online banking and commerce, and social media. National Indicators pertaining to ICT in Culture In order to estimate the necessary ICT investment in culture,
educating the youth the segment of population most active on internet, and with very low preoccupation for traditional occupations and increasing their interest in traditional practices.
There is a clear need for adequate ICT infrastructure, easy and affordable Internet usage, generalized ability and easier access to useful information.
Ability to access ICT networks does not involve people capacities to use the Internet and ICT equipment or tools.
Although the tendency of increase of the number of individuals using internet to search for information
and Internet usage at the regional level (Strategic) Promoting the system of learning together (Operational) Involvement of HR services within companies and public organizations:
In 2013,30%of people living in Europe use ecommerce service. ecommerce Definition ecommerce (Electronic commerce or EC) is the buying and selling of goods and services on the Internet, especially the World wide web.
electronic funds transfer, supply chain management, internet marketing, social media, electronic data interchange. For online retail selling, the term e-tailing is used sometimes. 4. 1. 2 European context Online Internet penetration
and purchasing still differ in the various parts of Europe, according to the maturity of the market, the level of trust, the availability of offers, the penetration of reliable payment options, reliable and affordable delivery, Internet-usage and penetration,
and consequently, the number of e-shoppers. European B2c ecommerce is developing extremely well. In 2010 Europe overtook the USA, the biggest market in the world until then.
%ecommerce Europe estimates the share of the European Internet economy at 3. 5, %a percentage that is set to double by 2016 and to triple by 2020.
purchasing an item over the internet should be a flexible process, facilitated through e-commerce. 4. Too numerous abuses and litigations
only 8%of population aged between 16-74 years has used the internet in 2012 for the acquisition of goods and services for personal use in Romania.
when only 1%of the population used the internet for the performance of online shopping,
14%of population aged between 16-74 years used the internet for online shopping in 2011,
Ministry for Information Society An important barrier for the development of the e-commerce is represented by the absence of information of the online service operators and internet.
and access offering to 15 Eurostat-Individuals making purchases over the internet, 2013; Eurostat-Individuals purchasing over the internet by regions, 2012 Page 90 of 170 platforms such as Enterprise Network Europe,
and the internet users may be protected through access to Consumer Protection Cooperation network systems (by assuring the protection of personal data,
ANCOM Market of services of electronic communications, 2012 Broadband services penetration in Romania According to ANCOM's biannual reports, the demand for broadband Internet services recorded a genuine boom starting from 2006
%Romania also provides a broadband Internet coverage for 90%of total population, and 78%coverage for rural area.
the percentage of population aged between 16-74 years who used the internet in 2013 to purchase personal goods
when only 1%of population was using the internet for purchases, followed by a fluctuating evolution during the following years.
In capital, the percentage of those aged between 16-74 years and who used the internet for shopping in 2011 was of 14,
Romania Urban Rural Population 55,1%44,9%Fixed internet access on household level 54,0%16,00%Broadband indicators 20 Eurostat-Individuals making purchases over the internet, 2013;
Eurostat-Individuals purchasing over the internet by regions, 2012 Page 106 of 170 Penetration rate on every 100 inhabitants 26,1%8, 8%Broadband internet connections on fixed
ANCOM Market of services of electronic communications, 2012 Digital Inclusion and Access In 2013,45%of the population was using the Internet regularly (at least once a week), significantly below the EU average of 72%.
Furthermore, a huge 42%of the population has used still never the Internet, more than double the rate for the EU average of 20%.
In what concerns the report between the households with access to internet and those with access to broadband connection it may be noticed in Romania a reduction of the gap in the years.
Whereas in 2006 out of 14%households with access to internet only 5%had broadband connection
Page 107 of 170 Access to Internet in Romania 2009 2010 2011 2012 2013 Inhabitants with access to internet(%)38%42%47%54%58%Access
to internet from home(%)28%31%36%N/A 46%Access to internet from workplace(%)10%11%12%N/A 14%Access to internet from institutions of education(%)6
%6%7%N/A 7%Access to internet from other places(%)3%2%3%N/A 3%Source:
but it is still at insufficient quotas and fixed high-speed Internet remains still a privilege of big cities.
%Public services of egovernment In 2013,5%of citizens in Romania made use of the internet for egovernment services.
On the level of enterprises, 63%of Romanian enterprises are using the Internet up to the 3rd degree of sophistication transactional egovernment services for interaction with public authorities
Eurostat survey, 2012 & 2013 Page 121 of 170 Household coverage with access to internet(%)Country 2009 2010 2011 2012 UE-27 66 70
Page 125 of 170 SWOT FOR ICT IN EDUCATION Strengths Weaknesses Increase in the internet use within the rural environment The computerisation of the pre-academic system,
and to support the homogenous internet utilisation among all groups of inhabitants and among all the regions of the country The opportunities
for the Software and Electronics industry National Association for Internet service providers Association of Producers and Distributors of ITC Equipments Romanian Association for Telecom Operators Association for Technology and Internet EOS Foundation Romania
of European Funds-National Strategy on Digital Agenda for Romania-Cloud computing in public sector-Fast access internet broadband-Presenting the socioeconomic study for the Digital Agenda Romania-Debate
to fixed broadband above 100 Mbps SMES to make online sales Population to buy online cross-border Population to buy online Among disadvantaged people Regular internet usage overall Population that has used never the internet
sales Population to buy online cross-border Population to buy online Among disadvantaged people Regular internet usage overall Population that has used never the internet Citizens using egovernment Returning completed forms
Subscriptions to fixed broadband above 100 Mbps SMES to make online sales Population to buy online cross-border Population to buy online Among disadvantaged people Regular internet usage overall Population
that has used never the internet Citizens using egovernment Returning completed forms%of staff costs related to IT services (from an overall budget for each entity) direct direct direct indirect indirect indirect indirect indirect indirect
to fixed broadband above 100 Mbps SMES to make online sales Population to buy online cross-border Population to buy online Among disadvantaged people Regular internet usage overall Population that has used never the internet
indirect indirect#of applications developed using Big data databases direct direct direct direct indirect indirect indirect indirect indirect indirect indirect%individuals using the internet regularly. direct direct direct direct direct direct direct direct indirect indirect
indirect%individuals from the category of those disfavored using the internet. direct indirect indirect indirect indirect indirect direct indirect direct direct indirect%of pupils trained with TIC skill. indirect direct direct direct direct direct direct direct indirect direct direct%education facilities using OER,
30 Mbps Subscriptions to fixed broadband above 100 Mbps SMES to make online sales Population to buy online cross-border Population to buy online Among disadvantaged people Regular internet usage
overall Population that has used never the internet Citizens using egovernment Returning completed forms#of localities
uploaded in Europeana direct indirect indirect direct indirect direct direct direct indirect indirect indirect%individuals using the internet regularly direct direct direct direct indirect indirect direct direct indirect indirect indirect%individuals from the category of those disfavored using the internet
. direct indirect indirect direct indirect direct direct direct indirect direct direct%of individuals who have used never the internet direct indirect indirect direct indirect direct indirect direct direct direct direct Page 169 of 170 Name of targets Covered by broadband
above 30 Mbps Subscriptions to fixed broadband above 100 Mbps SMES to make online sales Population to buy online cross-border Population to buy online Among disadvantaged people Regular internet usage
overall Population that has used never the internet Citizens using egovernment Returning completed forms%of pupils trained with TIC skill. indirect indirect indirect direct direct direct indirect indirect indirect direct direct
indirect%SMES which receives orders online direct direct indirect direct indirect direct direct direct indirect indirect indirect%individuals who use the internet to order goods and services from other
direct direct indirect direct direct direct direct direct indirect indirect indirect%individuals who use the internet to order goods
Population to buy online cross-border Population to buy online Among disadvantaged people Regular internet usage overall Population that has used never the internet Citizens using egovernment Returning completed forms%of individuals
direct direct direct direct direct direct indirect indirect Investments in infrastructure direct direct direct direct direct direct direct direct direct direct direct#of households with access to internet broadband (at least 30mbps) indirect direct direct direct direct direct direct direct direct direct direct
system cloud computing intelligent transport development of mobile applications, location-based services 3d GIS bioinformatics Internet of things 3d printing future internet 5g technologies remote
EXECUTIVE SUMMARY Digital technologies and the Internet have transformed many areas of business from Google and Amazon to Airbnb and Kickstarter.
and infrastructures e g. sensor networks where they connect their devices, such as phones and Internet modems,
which was founded in 2000 as a response to the lack of broadband Internet in rural Catalonia,
The Internet is approximately 40 years old and its capacity for generating societal and economic value is understood relatively well,
therefore, exists at the heart of the Internet. Despite the existence of a technical networking layer that could spread power
and solutions for a wide range of social needs and at a scale and speed that was unimaginable before the rise of the Internet'.
1. 1 Project overview 1. 2 Harnessing Collective Intelligence for the social good 1. 3 Digital Social Innovation in the context of Future Internet in Europe EXPLORING DSI
1. 1 Project overview 1. 2 Harnessing Collective Intelligence for the social good 1. 3 Digital Social Innovation in the context of Future Internet in Europe Growing
In particular, we examine how some of these digital services can take advantage of the network effect of the Internet
as the Internet is increasingly the technical underpinning of the sociotechnical fabric of our societies.
1) the level of the technical networking infrastructure itself provided by the Internet and 2) the level of online services built on top of these networks.
For example, despite the Internet being funded a military research project and the web a scientific project at their inceptions,
the Internet and web were based on open standards and a radically decentralised architecture that could be harnessed by any actor.
Beyond the Internet, many new technologies such as open hardware may have positive network externalities. This network effect applies in a straightforward manner for some services such as social networking sites like Facebook,
For each kind of socially innovative service, we want to determine how they can maximise their impact using the infrastructure made available by the widespread usage of digital tools such as the Internet.
the Internet forms a natural digital substrate for collective intelligence. Looking forward collective intelligence is necessary for social innovation to tackle the problems facing society in today's complex and interconnected world, where grasping problems such as the financial crisis, climate change,
At the present moment, the Internet offers unprecedented opportunities for collective intelligence via its increasing ubiquity and the massive amounts of data available for collective transformation into knowledge.
More than five billion additional people will connect to the Internet globally in the next ten years,
whilst over twenty billion objects will be connected to the Internet, transmitting data coming from people, sensors, the environment and objects themselves.
However, we cannot expect the Internet by itself to drive innovation to help citizens address major societal challenges.
If we observe the Internet during its early phases when it was funded primarily by research and defense, its founding principles, such as network neutrality, equitable service,
A main Internet trend-threat is recognised today: an increasing concentration of power in services in the hands of a few data aggregators, none of which are based in Europe (Google controlling nearly 82%of the global search market and 98%of the mobile search market,
and stimulate inclusive innovation. 1. 3 DIGITAL SOCIAL INNOVATION IN THE CONTEXT OF FUTURE INTERNET IN EUROPE The world wide web became successful
The future of the Internet should remain pluralistic, so that there is space for DSI alongside commercial services in the Cloud.
Digital social innovation could play a central role in the development of the Future Internet and the Internet of things.
Growing a Digital Social Innovation Ecosystem for Europe 19 POWER TO INTERNET THE PEOPLE Wikis, Usergenerated knowledge P2p Free Content Blogs Social networks E-democracy PEOPLE
The alternative is to accelerate innovations that align the capacities of the Internet better to social needs
A major risk for the Future Internet is the realisation of the‘Big brother'scenario, with big industrial players (mainly US-based) reinforcing their dominant position by implementing platform lock in strategies,
since we are seeing a consolidation of existing powers at every layer of the Internet ecosystem.
In the UK, Nesta research documented how 25%of UK adults used Internet technologies to share assets and resources in 2013 20146.
Commotion and Tor are using bottom-up privacy-preserving decentralised infrastructure for the open Internet constituted by open standards,
Important developments to re-decentralise the Internet, leveraging P2p open technologies, are happening at many levels.
while preserving the openness and accessibility of the Internet infrastructure. Many activities in this space are driven by grassroots networks,
while preserving the openness and accessibility of the Internet infrastructure. It includes projects that are using bottom up privacy-preserving
Community networking (also known as bottom-up networking) is an emerging model for the Future Internet across Europe and beyond,
Internet networks have become a key infrastructure for the development of the digital economy due to the‘democratisation'of the access technologies,
and obstacles regarding Internet specifications that are exposed by these edge networks. The Guifi. net initiative is developing a free,
Guifi. net is connected to the Catalan Internet Exchange (CATNIX) as an autonomous system (AS) via optical fibre with IPV4 and IPV6.
Other interesting examples of multidisciplinary research projects are the Network of Excellence on Internet Science (EINS),
that aims to integrate multidisciplinary scientific understanding of Internet networks and their co-evolution with society,
and moving towards and Open source Internet of Thingst Open-source hardware consists of hardware whose blueprints are made publicly available
which facilitate the anywhere/anytime access to the Internet, and to new services So-called Cyber Physical Systems (CPS),
and with the Internet, is giving rise to what has been named as Industry 4. 019 This smart infrastructure is also increasingly getting to know people by aggregating personal and social data in massive data centres.
Successful actors in DSI have managed to leverage large networks using the Internet in order to accomplish innovation at scale by the network effect.
Top-down and systemic approaches The most relevant initiatives are the European Innovation Partnerships, Smart Cities, the Future Internet Public-Private Partnership Programme (FI-PPP),
The development of the Future Internet is addressed mainly through a number of technical projects, such as the FI PPP23 and the 5g PPP24.
Also the Internet needs to continue to be a neutral space where creativity can continue to flourish. 7. Gender Equality in DSI Promote gender equality and empowerment of women through ICT in DSI by tackling things such as criteria for funding
The Internet ecosystem today is highly centralised The current Internet is dominated by a handful of mainly US companies that control all the layers of the ecosystem (app store, cloud, machine learning, devices),
DARPA led to the creation of the internet, the R&d funding at CERN led to the invention of the Web) Encourage people to think about:
and encryption Federated identity management Data control and data ownership The EU data protection reform package Directive on the reuse of public sector information Copyright reform Net Neutrality Magna carta for the Internet Enabling
The Internet is the best example of the power of interoperability. Its open architecture has given billions of people around the world access to information,
Today mobile devices with always-on Internet connectivity are becoming widespread. 74 Growing a Digital Social Innovation Ecosystem for Europe INTEROPERABILITY50 In the area of copyright,
OPEN PLATFORMS Users of the Internet ecosystem include the independent application and service providers who have the right to use the future Internet infrastructure (including both data in a raw and processed form,
as well as access to computing resources). Any privileged access provided to the owner/managers of the infrastructure would alter free competition.
A Magna carta for the Internet Tim Berners Lee, the inventor of the Web is advocating for a sort of Magna carta for the Internet to estabilish basic rights and freedoms,
to keep the Internet open, without surveillance and censorship, and to halt power abuses from Governments and corporations.
The Magna carta for the Internet goes along with recent UN General assembly (UNGA) resolution on The Right to privacy in the Digital Age. 68.
INVESTMENT ON ENABLING INFRASTRUCTURES Community and bottom-up networking is an emerging mode of the Future Internet,
plugging into existing and future Internet infrastructures. At regulatory level The Digital agenda emphasises the need to adopt open standards
Consultant Logica Daniel Kaplan Founder and CEO, The next-Generation Internet Foundation Simona Levi Founder, Forum for the Access to Culture and Knowledge Markkula Markku Committee
/programmes/horizon2020/23 http://www. fi-ppp. eu/24 http://5g-ppp. eu/25 http://www. internet-of-thingsresearch. eu 26
/field/image/internet-of-things-2. jpg Page 35 Brendan Lea (2013) Open Data Institute Annual Summit 2013 online Flickr, Open
https://www. flickr. com/photos/giuli-o/3421327165 Accessed 29th january 2015 Page 75 Randy Matusky (2013) Map of the Internet online http://diaryofanelearner
A report of results from the Internet Safety Group's survey of teenage mobile phone use.
9 Benefits of ICT and Internet use...9 ICT adoption and firm performance...11 Use of ICT and Internet among SMES...
11 Adoption of Internet e-commerce by SMES...13 Towards e-business integration...18 II. BARRIERS TO USE...
19 Unsuitability for business...19 Enabling factors: internal ICT and managerial knowledge...20 Cost of developing
44 4 ICT, E-BUSINESS AND SMES EXECUTIVE SUMMARY Information and communication technology (ICT) connectivity (PCS and Internet) is very widespread in businesses of all sizes.
and Internet use programmes. However commercial considerations and potential returns are the principal drivers of small business adoption and profitable use.
Despite these advantages, rapid growth in businesses'purchases and sales over the Internet has yet to materialise.
Broad definitions of e-commerce including established EDI as well as Internet transactions) suggest that in 2000 total on-line transactions were generally 10
although they lag behind larger firms in Internet transactions. For small firms to adopt e-business and e-commerce strategies and tools
and availability and cost of appropriate interoperable small-firm systems, network infrastructure and Internet-related support services.
e-mail and the Internet and their applications can have on their business. 4 In advanced OECD countries,
Communication via e-mail and the Internet can help to improve external communication, in either B2c or B2b contexts,
Benefits of ICT and Internet use ICT and e-commerce offer benefits for a wide range of business processes.
the Internet and e-commerce have great potential for reducing transaction costs and increasing the speed and reliability of transactions.
Internet-based B2b interaction and real-time communication can reduce information asymmetries between buyers and suppliers and build closer relationships among trading partners (Moodley, 2002.
or Internet commerce are used according to the OECD's narrow definition: the sale or purchase of goods or services conducted over the Internet,
with the goods and services ordered over the Internet, and payment and ultimate delivery of the goods or services either on line or off line.
The OECD's broad definition includes transactions conducted over computer-mediated networks, such as the Internet, EDI (electronic data interchange), Minitel and interactive telephone systems. 10 In the B2c context, the Internet and e-commerce can be effective tools for better communication.
A corporate Web site that provides information on products, services or technologies can enhance the quality of a firm's services to customers
Eurostat's E-commerce Pilot Survey shows that SMES'motives for Internet commerce include reaching new/more customers, geographic expansion of market and improvement of service quality.
Internet and e-commerce enable SMES that remain in local and regional markets because of a lack of information
Internet technology makes it possible to transmit order information seamlessly between different systems. It can therefore provide small players with an opportunity to join
Moreover, the Internet can convey the ideas of knowledge-based small businesses. Extensive use of ICT can allow micro-enterprises with ideas
and some micro-enterprises have generated substantial global sales by exploiting their intellectual property over the Internet. 11 ICT adoption
and Internet among SMES The use of ICT by SMES is increasingly common according to survey for OECD countries.
While Internet penetration is generally higher in larger enterprises the gap between larger firms and SMES is narrowing.
In most OECD countries, Internet penetration rates for medium-sized firms (50-249 employees) are the same and sometimes higher than for larger firms (more than 250 employees), with penetration rates
while in countries with lower Internet penetration (Portugal, Greece, Mexico) there are larger dispersions across firms in different size classes (OECD, 2002c).
Figure 1. Internet penetration by size class, 2001 or latest available year Percentage of businesses using the Internet 50 60 70 80 90 100finland Sweden
Note 3. Internet and other computer-mediated networks. Source: OECD, ICT database and Eurostat, Community Survey on ICT usage in enterprises 2002, May 2003.
Data available from surveys in some countries indicate that SMES use the Internet (and e-mail) for better external communications and as a means of obtaining business information.
In Japan, the most common use of the Internet is general information searches (Figure 2). Other uses include communication via e-mail,
office equipment and software over the Internet, but only a small share conduct B2c and B2b Internet e-commerce for nonstandard products.
A study of 484 SMES with fewer than 250 employees in Lanarkshire (Scotland) shows a similar pattern of Internet use.
Around 60%of the firms with the Internet use it to learn about competitors, customers or suppliers.
Other major uses include providing product information (56%),setting up a Web page (54%),purchasing goods/services (53%)and building customer connections (48%)(Scally et al.
2001). 13 Figure 2. Internet use by SMES in Japan, 2001 6%8%17%18%20%23%33%43%68%82%0
Percentage of responses of 1 700 SMES with 300 or fewer employees using the Internet as of August 2001.
Adoption of Internet e-commerce by SMES Computers and access to the Internet have become common in most OECD countries,
but sales and purchases over the Internet have yet to take off. While available data suggest that electronic commerce is growing,
Purchasing over the Internet is more common than selling. For 16 countries for which both Internet purchasing and Internet sales data are available, only one in eight on average reported making Internet sales.
Twice as many businesses on average use the Internet for purchases as for sales (Figure 3), with between 63%and 93%of businesses reported using the Internet,
except in Greece and Luxembourg (OECD, 2002c). 14 Figure 3. Businesses using the Internet for purchasing and selling,
20011 Percentage of businesses with ten or more employees 0 20 40 60 80 100 Denmark Japan (2) Finland Sweden Australia New zealand Austria Norway
Netherlands (3) Italy Portugal Canada (4) Spain United kingdom (5) Luxembourg Greece%Businesses using the Internet Businesses receiving orders over the Internet Businesses ordering over the Internet Note:
The results of the Eurostat survey are based on a selection of industries that changes slightly across countries.
Denmark and Norway also survey personal services. 1. Beginning of 2001 for Internet use; purchases and sales refer to 2000, for Canada,
for Denmark and Norway, Internet use refers to 2002 and purchases and sales refer to 2001.2.
and placed refer to Internet and other computer-mediated networks. 4. All businesses. 5. Orders received
and placed over the Internet and other computer-mediated networks. Source: OECD, ICT database, August 2002;
The gap between SMES and larger firms is greater for Internet purchases than for Internet sales.
In other OECD countries, Internet purchasing seems to be sensitive to firm size, with the largest firms having the highest percentages of purchases.
However, the propensity to sell over the Internet seems less sensitive to firm size. The difference between large firms and SMES is less than 10%,except in the United kingdom. In Australia, Denmark and Sweden,
smaller businesses that use the Internet appear to have roughly same propensity to sell over the Internet as larger ones (Figure 4). 15 Figure 4. Internet purchases and sales by size class,
or placed over the Internet and other computer-mediated networks. Source: OECD, ICT database, August 2002;
In terms of volume, Internet sales by SMES are far below those of larger firms. In the case of larger businesses in European countries (Figure 5), a maximum of 10.6%of businesses (in Sweden) had more than 5%of sales originating on the Internet in 2000,
and a maximum of 1. 2%of businesses (in Denmark) had Internet sales whose value was more than 50%of overall sales.
However, for smaller businesses, Internet sales are lower relatively, with around 11%of businesses having a share of Internet sales greater than 1%,
%compared to over 19%in the case of larger firms (in Sweden)( OECD 2002c. 16 Figure 5. Distribution of e-commerce sales in European countries, 2000 Percentage of businesses for any given country whose sales over the Internet as a share of total sales are greater than 1%,2
%,5%,10%,25%or 50%in larger and smaller businesses Source: OECD, based on Eurostat, E-commerce Pilot Survey 2001.
There have been some indications that the number of businesses selling on line is declining and e-commerce is being concentrated in fewer, larger businesses.
In Australia, over the period July 1999-June 2001, selling over the Internet by micro-enterprises with 5-9 employees declined from 16%to 13%and by firms with 10-49 employees from 21%to 18,
Most Internet e-commerce transactions are domestic rather than cross-border transactions (Figure 6). The Eurostat's E-commerce Pilot Survey indicates that European companies mainly sell over the Internet to locations within Europe.
In Austria, Denmark and Finland, exports to Europe represent between 55%and 63%of total exports of goods. The share of international Internet sales is particularly small in the United kingdom,
is linked to the Internet via phone lines or, increasingly by a VSAT connection. It serves an average of 600 farmers in 10 surrounding villages within about a five kilometres radius. Each E-Choupal costs between USD 3 000
South africa, Brazil, Chile, China, India, Russia and Singapore. 18 Figure 6. Share of Internet sales in domestic and international markets, 2000 or latest available year
BARRIERS TO USE There is a wide range of reasons why SMES do not make more active use of the Internet and ebusiness.
A recent survey of SMES with fewer than 250 employees in 19 European countries shows that around 40%do not use the Internet for selling
because they consider that Internet e-commerce does not suit their type of business and/or products (Figure 7). Other reasons for not conducting on-line sales include lack of personnel with appropriate ICT skills, concerns over unbalanced costs and benefits, insufficient customer access to Internet
and technology concerns, such as on-line security. In Canada, among businesses that did not buy or sell over the Internet,
56%believed that their goods or services did not lend themselves to Internet transactions. Figure 7. SMES in Europe:
Reasons for not using the Internet for selling, 2001 3%5%16%16%40%2%9%14%20%40%3%6%18%17%43%0%10%20%30
%40%50%Do not trust technology/security Customer's access to Internet is insufficient It w ould not pay off No skilled personnel Does not apply to the type of enterprise/product Micro firms w ith 0
-9 employees Small firms w ith 10-49 employees Medium firms w ith 50-249 employees Note:
Percentage of 1 427 firms with fewer than 250 employees not using the Internet in 19 countries (15 EU member states plus Iceland, Liechtenstein, Norway and Switzerland.
In sectors such as construction and among some small retailers, the view that Internet e-commerce is unsuitable for their business is relatively strong.
Some SMES in transport services also consider that the Internet does not suit their industry.
A firm with 90 employees and an emphasis on personal contact with clients decided not to adopt the Internet after a three-month trial of a Web site (Mehrtens et al.
Very few of its regular customers had used the Internet, and some preferred receiving confirmation of their order via fax or telephone.
The firms that adopt Internet and e-commerce are likely to have within the firm someone who has a reasonable amount of knowledge of the specific technology and/or technology in general.
A study of small ICT companies with 3-80 employees suggests that the Internet was adopted by firms with personnel who understand the technology (Mehrtens et al.
lack of ICT expertise within the firm is not necessarily an obstacle to the decision to adopt Internet e-commerce.
In 1996 a company employee bought a personal computer at his own expense to use the Internet.
other small firms in the region were encouraged to engage in Internet e-commerce. SMES may also lack managerial understanding and skills for e-business.
if the cost of basic Internet use is well within their marketing Budget for example, in the United states, typical Internet charges USD 10-35 a year for a domain name (i e.
Percentage of total investment in Internet e-commerce. N=34. Source: Ernst & young (2001. Logistics services, e g. package collection and delivery, also matter.
Items such as software, music and books can be delivered over the Internet, but the volume of such on-line delivery is still very small.
Slow Internet connections and data transfer have discouraged in fact some SMES from adopting Internet: a majority of SMES with 10-249 employees in Austria, Greece, Italy, Luxembourg, Spain, Portugal and the United kingdom indicated excessively slow or unstable data communication as a major hindrance to Internet use (Eurostat, 2002.
Broadband penetration rates have accelerated rapidly in most OECD countries recently although it is very uneven across countries (Figure 10).
Business use of the Internet via broadband connection (xdsl) by firm size, 2001 Percentage of businesses with ten or more employees using the Internet 0 10 20 30 40 50 60 70 80 Finland Italy Austria Spain Portugal
United kingdom Luxembourg Greece%10-49 50-249 250+10+Source: OECD, ICT database and Eurostat, E-commerce Pilot Survey 2001, August 2002.
Internet access prices are a key determinant of Internet and e-commerce use by individuals and businesses (Figure 13).
Countries with lower access costs typically have a greater number of Internet hosts, and electronic commerce has developed rapidly in countries with unmetered (flat-rate) access (OECD, 2001a).
Price of 40 hours of Internet use at peak times, August 2001, in PPP dollars OECD Internet access basket for 40 hours at peak times using discounted PSTN rates1
but Thailand led in early Internet use with almost double the users (almost 8) per 100 inhabitants in 2002,
%but inequalities in income distribution means the Internet is not affordable for a large proportion of the population.
hackers) are among the most important perceived barriers to Internet use by businesses (B2b and B2c),
and have a larger share of transactions over the Internet (OECD, 2002c). Barriers to Internet commerce for businesses included payment uncertainties and contract, delivery and guarantee uncertainties, with very wide variations in perceived barriers across countries,
and unsuitability the major barrier. Payment uncertainties were relatively important in Italy, Spain, Austria, the United kingdom,
Small and large businesses facing barriers to Internet payments, 2000 Percentage of businesses using a computer with ten or more employees 05 10 15 20 25 30 35 40 45 Italy Spain Austria United kingdom Finland
and legal protection for Internet purchases are the two first obstacles pointed out in the CRITO global survey (2 139 firms in 10 countries)
Overall, SMES are more sensitive to local environmental obstacles than large firms (costs of Internet access, business laws, prevalence of credit card use in the country, taxation of Internet sales),
32.6 41.1 32.9 22.2 23.1 22.4 23.9 Level of ability to use the Internet as part of business strategy 21.5 27.0 21.8 22.3 24.8 22.4 31.8
34.9 32.2 34.8 31.9 22.2 31.6 40.8 40.4 40.8 24. 2 Taxation of Internet sales 28.5 23.6 28.3 27.1 17.6 26.8
19.9 15.6 19.1 16.5 Inadequate legal protection for Internet purchases 42.6 63.5 43.6 41.6 34.4 41.4 55.7 49.1 54.5 34.1 Source:
Legal uncertainties Most Internet e-commerce transactions are domestic rather than cross-border. Although there may be other reasons,
In another European commission survey, a small percentage of small firms with 10-49 employees indicated national differences in consumer protection as the most important reason for not using the Internet (European commission, 2002a.
and restructure business processes to make better use of the Internet and the potential of e-business.
The OECD's EBIP (Electronic commerce Business Impacts Project) study undertook in depth interviews with 217 firms that were early adopters of Internet and e-business strategies (OECD
except that small firms generally had less well-formed opinions about factors affecting their Internet efforts,
and automobiles to illustrate sectoral differences in e-business and Internet strategies. Internet e-commerce can enable businesses to reach a wider
and possibly more targeted range of customers either locally or globally, either in B2b transactions (automobiles, textiles) or B2c transactions (textiles, tourism, parts of retail
Cross-sector surveys show that there are some differences in the use of the Internet by SMES across different sectors.
In Europe, only around a third of SMES receive orders over the Internet. Their most common use of the Internet is for distribution of product/service information (Figure 15.
A slightly higher percentage of firms in manufacturing, wholesale and business services receive orders over the Web than those in retail and construction.
Some SMES send order confirmations via the Internet, although it is not clear how many of these orders were received over the Web rather than through other means, such as fax or telephone.
commercial activities using the Internet, 2001 58%63%63%68%71%26%33%37%38%35%24%26%31%29%30%0%20%40%60
Percentage of responses of firms with fewer than 250 employees using the Internet in 19 countries (15 EU member states plus Iceland, Liechtenstein, Norway and Switzerland.
Tourism In tourism, an area dominated by SMES in OECD countries, some small tour operators, hotels and inns, restaurants and travel agencies have been active in fostering cross-border Internet e-commerce.
The Internet allows travellers direct access to travel recommendations, reviews and local tourism information, many
Since the Internet and many travel-related sites allow on-line customers to compare the price of 32 air tickets and other travel services,
The volume of Internet e-commerce in tourism, has grown very rapidly, but still largely involves ticketing for passenger transportation and accommodation.
The Internet is used mainly for travel-related information and promotion. In the United states, where on-line travel sales grew rapidly from USD 400 million in 1997 to USD 22.7 billion in 2002
in the United states, over 64 million people used the Internet for travel planning, little changed from 2002 due to the slower growth of wired households,
but over 42 million people (30 percent of the adult population) used the Internet to book travel online, up 8 percent from 2002,
These characteristics make tourism products very well suited for purchase over the Internet. In addition, most travel products, like air travel and hotel rooms, are perishable and last-minute on-line sales provide a new distribution channel
Transaction costs over the Internet can be significantly lower than those of traditional distribution channels.
However, use of Internet commerce in the tourism sector is likely to concentrate on B2c rather than B2b transactions,
Retail Use of Internet commerce among SMES in the retail industry is lower than in business services and manufacturing.
Several studies suggest that even the most price-sensitive Internet consumers respond very strongly to well-known, heavily branded (large) retailers, such as amazon com.
An early study of Internet brand establishment analysing 20 000 on-line consumers who compared and purchased books from 33 on-line bookshops found that most did not choose the lowest price offer
along with music and video, books and magazines and software, are among the leading consumer products sold over the Internet (OECD, 2002c).
Again, small suppliers and shops have not necessarily been enthusiastic about the adoption of costly EDI or the Internet.
It uses the Internet to receive orders and to send digital images of products only to known clients (which then sell to other buyers).
Brian decided to use the Internet to reach much a wider market without radically increasing his overhead costs.
see EDI (and its recent Internet forms) as a strategic necessity for not losing business with car producers
EDI systems in advanced OECD countries have attempted to integrate different communication networks into a single Internet network.
The Internet-based EDI, ANX (Automotive Network Exchange) was started in 1994 and operated in the United states from 1998-2002
Summary The adoption and use of Internet and e-business strategies depend on sector characteristics. The products of services like tourism,
are suited well for purchase over the Internet. In addition, in sectors such as tourism and parts of retail and finance
Barriers to Internet commerce also vary among sectors. In tourism, incompatibility of systems and the dominance of relatively small agents with less capability impedes efficient Internet transactions along the supply chain, especially for B2b transactions.
In the retail sector, the problem of confidence building seems more crucial. In manufacturing sectors
POLICY IMPLICATIONS SMES have been slower than larger firms to adopt Internet and e-business strategies despite the potential benefits.
All OECD countries have introduced programmes to speed SME e-business and Internet development. However, the recent features of e-business and Internet use will also structure policy.
First and foremost, most e-commerce is B2b rather than B2c, which means government policy needs to focus on value chain participation.
Next, most Internet e-commerce transactions are domestic rather than cross-border. Finally use varies widely among sectors,
Governments have used many policies to encourage the diffusion of e-business and Internet use from fostering technological diffusion to creating a favourable business environment with fair and predictable rules.
if Internet commerce is unsuitable for their business, or if expected benefits are outweighed by costs.
Some are sophisticated as users of the Internet and e-business as larger firms, while others make no use at all.
The availability of a wide range of high quality Internet and communication services at competitive prices is particularly important
In particular, broadband, characterised by high-speed, always-on connection and two-way capability, allows faster access and delivery of existing on-line services and new applications and services such as streaming audio and video over the Internet
The open architecture of the Internet does not necessarily result in more open markets, because e-commerce among businesses is initiated usually by dominant companies in value chains.
E-business and Internet strategies appear to be reinforcing market structures and the role of these companies.
While Internet commerce provides SMES with opportunities to participate in new supply chains and markets,
can also provide SMES with new incentives to adopt Internet and e-commerce in order to enter new markets.
and Internet programmes focused on SMES. Three new directions are emerging in such policies. These are in addition to initiatives that aim at facilitating the participation of SMES in e-business value chains rather than simply encouraging them to adopt e-commerce.
Netherlands Netherlands Go Digital Supports trade organisations in the development of an ICT strategy to stimulate their members'Internet and e-commerce adoption.
Training is provided increasingly over the Internet and, in some cases, in conjunction with ICT and e-commerce awareness and business consultation services.
of Continuous Training for Traders and SMES offer training courses on the Internet. Forem's Web site provides a meeting place for businesses (e g. job vacancy advertising), a list of training programmes and aids for training.
and college students as student business advisors to provide customised Internet and e-commerce training to SMES.
Spain A programme is designed for micro-enterprises (fewer than 20 employees) in small towns with a special emphasis on training in the use of the Internet, e-mail and new management techniques.
Turkey KOSGEB KOSGEB, with more than 40 service centres and 25 Internet cafés across the country contributes to building computer and Internet literacy in SMES.
United kingdom Learndirect SMES are a priority group for the on-line service. Each course, looking at a specific business issue, allows SME managers
The EU covers a wide range of e-business environment, Internet and ICT use issues. eeurope 2005,
and exploit e-business and Internet strategies. In addition, specific policies have been common in areas seen to be crucial for initial uptake (e g. awareness, managerial and ICT skills.
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