Speaking at the IDC Directions conference in Melbourne today, Fell said Australia ranks ninth on his company's Information Society Index, which measures factors such as deregulated telecommunications, the per-capita level of spending on IT, and the level of Internet penetration of homes and businesses.
IDC has found nearly 60 per cent of workplace PCs have Internet access and large sites are planning for 100 per cent access by the end of this year, and extranet usage (already at 18 per cent in large businesses) is set to grow rapidly. Overall, 58 per cent of Australian IT spending in 2004 will be web-related if middleware and other web-enabling technologies are included.
While there is strong growth in spending on web initiatives among medium and large companies, there are still obstacles to Internet adoption, including concerns over security, the ability to reach target markets, in-house skill levels, reliability and cost.
However, budget growth for the current year shows "strong, sustained spending... [and a] determination to overcome these obstacles," said Fell.
Spending plans also show "a strong swing from software to services," with services expenditure rising from 25 per cent to 35 per cent of e-business solutions spending between 1999 and 2000.
Fell warned the audience that e-business is evolving, saying "if you think you understood eBusiness 1.0, don't assume you understand eBusiness 2.0," which focuses on the integration of business processes, and linking suppliers and customers for competitive advantage.
He also suggested that the idea of disintermediation is falling out of favour as an era of hypermediation emerges with a whole series of intermediaries including ISPs, portals, specialist sites, suppliers, payment partners and delivery services all picking up "click through" revenues in the course of a transaction.
Describing business to business e-commerce as "the heart of the revolution," accounting for over 87 percent of all e-commerce by 2004, Fell suggested there will be no reason why a large company would not go to a digital market when purchasing commodity products. He pointed out that Optus is creating a vertical market portal for this purpose, and that it expects to be the largest customer of that market.
