The Government plans to generate a "buzz" about e-commerce among small businesses by blitzing them with £25m worth of advice about the Internet over the next three years.
The money will be used to fund training and provide Web-enabled call centre experts to give e-commerce advice online .
The Government has admitted that the existing DTI service - the Inform-ation Society Initiative - has "low awareness in the SME (small to medium-sized enterprise) community". This is despite the fact that the target of getting 1.1 million SMEs on the Internet has been beaten, with 1.7 million small companies now using the Internet.
UK Online aims to get one million SMEs actually trading online by 2002, as part of a drive to get a higher percentage of business-to-business and business-to-consumer transactions taking place online in the UK than in any other G7 country.
But will it work? Durham-based company DGC Distribution was cited in the UK Online report as an example of best practice, after it won this year's national e-commerce award. Initially, DGC launched the online musical instrument ordering service guvnor.com to cut down on operating costs - but putting transactions online also achieved 30% sales growth.
DGC managing director Simon Cohen was dubious about the value of the online advice service. Would he have found advice centres useful? "To be blunt, no," he said, and added that not even Silicon Valley specialists had been of much use.
"It was massively difficult to set the site up. The learning curve was enormous, as there was no technology that could do what we wanted and we had to develop it ourselves," he said.
Cohen said the award had been very useful for boosting the profile of the site but slammed the UK's e-commerce infrastructure. "In England at the moment we're in an Internet black hole. We don't have the pipes or the resources here."
Federation of Small Businesses spokesman David Hands said that although the Government's initiatives were promising, they had failed to focus on micro businesses - those with less than 10 staff - which are the ones that could benefit most from the Web.
Hands pointed to the e-incentive which rewards small businesses with discounts of up to £150 if they file their tax returns on the Internet.
The scheme is being picked up by medium-sized companies but not the smallest ones, he said.
According to the DTI, 55% of micro businesses are now online compared to 15% last year.
Hands also questioned the value of e-transactions as a target. He felt that smaller companies could benefit through online tax returns and using the Net for research rather than commercial transactions, which he said were "still a long way off" for most.
But Hands also praised some sections of the initiative - especially the fiscal incentive, which allows small businesses to write off against taxable profits 100% of their first year capital investments in information and communications technology.
British Chamber of Commerce spokesman Andrew Parkinson welcomed the report. "I think it is a positive step in the right direction," he said, and added that small businesses were crucial to an online culture.
UK Online's 25 commitments
1. Drive forward competition in Internet-access markets:
2. Establish a new framework for regulation of the converging markets of telecommunications and broadcasting in the new White Paper
3. Identify and remove all remaining regulatory and legal barriers to electronic ways of working in the UK
4. Take action with international partners to develop an effective, light-touch global framework for e-commerce
5. Implement a package of measures to improve access to the Internet at home, at work and in the community
6. Embed information and communication technology skills in the education system and throughout lifelong learning
7. Work with industry to ensure a secure environment for e-commerce and to help people trust the Internet, including:
8. Help increase people's motivation to access the Internet by driving up the amount and quality of social content
9. Invest an additional £25m over three years to help small businesses exploit the potential of ICT:
10. Support industry in improving competitiveness through e-business technologies and processes
11. Get all government services online
12. Drive forward towards e-procurement and e-tendering targets
14. Drive forward citizen participation in democracy as part of the UK online citizen portal
15. Drive forward the use of authentication services both for e-government services and within government itself
16. Implement a strategy to make the UK the number one country for the supply of high-level ITec skills, taking account of the recommendations of the Skills for the Information Age report
17. Invest in leading-edge e-science
18. Facilitate ITec knowledge transfer
19. Implement an action plan for growth for the digital content sector, including through liberalised access to government information
20. Work with industry to develop a UK strategy for m-commerce
21. Establish new mechanisms to co-ordinate access and skills initiatives at national, regional and local level:
22. Further develop and implement the UK Online campaign
23. Secure international agreement to a common framework for measuring e-commerce:
24. Improve e-commerce measurement in the UK
25. Implement a programme to evaluate the net economic impact of e-commerce
This was first published in September 2000