Page 70 - Electronic Commerce

Introduction to Electronic Commerce

North Korea and Singapore have also adopted rules and policies that restrict their
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citizens’ use of the Internet. These countries will continue to face difficult policy choices
as they maintain their attempts to control individuals’ use of the Internet while at the
same time trying to encourage growth in online business transactions.
Some countries, although they do not ban electronic commerce entirely, have strong
cultural requirements that have found their way into the legal codes that govern business
conduct. In France, an advertisement for a product or service must be in French. Thus, a
business in the United States that advertises its products on the Web and is willing to ship
goods to France must provide a French version of its pages if it intends to comply with
French law. Many U.S. electronic commerce sites include in their Web pages a list of the
countries from which they will accept orders through their Web sites to limit their
exposure to laws such as this.

Infrastructure Issues
Businesses that successfully meet the challenges posed by trust, language, and culture
issues still face the challenges posed by variations and inadequacies in the infrastructure
that supports the Internet throughout the world. Internet infrastructure includes the
computers and software connected to the Internet and the communications networks over
which the message packets travel. In many countries other than the United States, the
telecommunications industry is either government-owned or heavily regulated by the
government. In many cases, regulations in these countries have inhibited the development
of the telecommunications infrastructure or limited the expansion of that infrastructure to
a size that cannot reliably support Internet traffic.
Local connection costs through the existing telephone networks in many developing
countries are very high compared to U.S. costs for similar access. This can have a
profound effect on the behavior of electronic commerce participants. For example, in
countries where Internet connection costs are high, few businesspeople would spend time
surfing the Web to shop for a product. They would use a Web browser only to navigate to
a specific site that they know offers the product they want to buy. Thus, to be successful
in selling to businesses in such countries, a company would need to advertise its Web
presence in traditional media instead of relying on Web search engines to deliver
customers to their Web sites. This problem continues in many countries even as they
move to mobile devices for Internet access. In India and China, data plans for
smartphones are very expensive. These costs limit Internet usage, especially B2C Web
shopping, just as high telephone network costs have in the past.
More than half of all businesses on the Web turn away international orders because
they do not have the processes in place to handle such orders. Some of these companies
are losing millions of dollars’ worth of international business each year. This problem is
increasingly global; not only are U.S. businesses having difficulty reaching their
international markets, but businesses in other countries are having even greater
difficulties reaching the U.S. market.
The paperwork and often-convoluted processes that accompany international
transactions are targets for technological solutions. Most firms that conduct business
internationally rely on a complex array of freight-forwarding companies, customs brokers,

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