Preface

Electronic commerce is now one of the most significant drivers of both successful business development and national economic development. It is a form of business operation in which the era of truly global markets and global competition has arrived. Throughout the world, leading enterprises in all sectors of economic activity are changing their business strategies to make more effective use of Internet technologies in their operations – including marketing, product development and distribution.

Because e-commerce is a fundamentally new way of conducting business the policy environment within which it can grow and thrive is different to that within which traditional business do so. Throughout the world, at the present time, Governments are putting new policies into place to capture the exceptional opportunities for both economic and social benefit that e-commerce provides. In Ireland, the Government has set the target of making Ireland a global leader in e-commerce, and is actively implementing policies to develop the building blocks for the digital economy.

Because advanced telecommunications is a fundamental requirement for the successful development of e-commerce, Forfás has prepared and published a number of reports on the required investments in this basic infrastructure. These include the proposal and feasibility study for the National Digital Park launched recently by the Taoiseach, the Tánaiste and the Minister for Public Enterprise. They also include Broadband Investment in Ireland (March 1998) and, under the auspices of the National Competitiveness Council, a report on Telecommunications – A key Factor in Competitiveness and Electronic Commerce (November 1998). In this last report particular attention was drawn to the need for all enterprises to plan for the changeover to e-commerce and the need for Government to put in place the required legal and regulatory environment in which e-commerce can prosper. These reports demonstrated that the availability of broadband telecommunication services in all parts of the country, with high capacity international links, is a prerequisite for the development of the digital economy.

This Report on E-commerce – The Policy Requirements complements previous Forfás reports on telecommunications and the skill needs of the electronics and software sectors. The skills issue was considered in the First Report of the Expert Group on Future Skills Needs, published by Forfás in Dcember 1998. The telecommunications infrastructure and skills are the two most critical areas in developing the solid foundations on which e-commerce can be built as an intrinsic part of an information society in Ireland. Because the infrastructural requirements of the information society are now widely understood and because substantive action is under way to meet these requirements, the report concentrates instead on how to make best use of that infrastructure. There is, of course, a continuing need to benchmark infrastructural availability and the cost of services on it against best practice in other countries with advanced telecommunications facilities. The report was prepared at the request of the Tánaiste and Minister for Enterprise, Trade and Employment, Mary Harney, T.D. It assesses the development and potential of e-commerce, outlines the policy responses of other countries and analyses the sectoral implications and the requirements for a conducive business environment. In each case, recommendations are made for Government Departments, for the development agencies, and for enterprise. IDA Ireland, Enterprise Ireland, Shannon Development and Údaras na Gaeltachta have formulated strategies for the attraction of e-commerce-related inward investment and for the development of Irish-owned enterprise in the digital economy, and these strategies are summarised in this report.

E-Commerce provides a major opportunity for the development of profitable business in Ireland providing stable, well paid employment in both existing firms and in new start-up business. For firms that embrace the new technologies and new ways of doing business, these opportunities are immense. For firms that do not, the results could prove fatal.

The recommendations in this report seek to further advance the contribution which e-commerce can make to social and economic development in Ireland.

Michael McKenna

Chairman

Electronic Commerce Policy Steering Group