Euro set to expose Net inadequacies

E-commerce Single currency will exaggerate cross-border problems.

The European single currency is not going to kickstart e-commerce on the continent, but will instead expose many of its current constraints.

According to Martha Bennett, vice president of European research at Giga Information Group, there are still too many unresolved issues for companies conducting cross-border e-commerce. Apart from language and cultural barriers and the fact that all the countries are at very different stages of internet adoption, there are many more practical problems, Bennett said on the second day of Giga's Business Online 99 conference.

The main inhibitor is the infrastructure - the low availability of high-speed internet access from the home and high-access costs compared to the US, she added.

A lack of uniform regulation across Europe was another major barrier, Bennett added. Laws governing what can be advertised and to who differ from country to country, while consumer protection and privacy and data protection remain big issues. The euro will highlight these problems as companies try to promote and sell the same goods across Europe.

'There are still many unresolved issues that are stopping business. For example, the common market doesn't exist in terms of warranty across Europe,' she said, adding that there were no national or pan-European infrastructures for micro payments online and digital signatures.

'The euro will crassly highlight the restrictive payment systems available to consumers. We already have one pan-European payment system - the credit card,' added Bennett. 'With the euro we will have two, but only one can be used online.' Different chip card systems are being developed across the continent, but they are not compatible and users still have to load cash onto smart cards from an outside source.

Despite these restrictions, Bennett urged companies not to be discouraged but instead to look at Europe as a whole, as a huge market with enormous buying power. Companies must also take advantage of the areas where Europe is ahead of the US, such as GSM mobile phones, she added.