The month in e-business - March

Telephony pricing war hots up

A string of companies announced plans to offer unmetered Internet access. Alta Vista started the trend, followed...

Telephony pricing war hots up

A string of companies announced plans to offer unmetered Internet access. Alta Vista started the trend, followed by NTL and BT belatedly joining the pack, the latter's Surf Time package offering unlimited access for around £19 a month, including phone charges. Unmetered telephone charges, which are the norm in America, are seen by most analysts as a key requirement in ensuring widespread take-up of the Internet in the UK.

Following its float at 380p a share last month, suffered a rollercoaster ride on the stock market with the price having sunk to 320p as E-Business Review went to press. The crash led to fears that Lastminute's arrival could already mark the top of the market for Internet stocks. But supporters pointed out that the company has a global first mover advantage, with no-one else specialising in clearing last minute services, from flights to theatre tickets. The price fall demonstrated that dotcom valuations are hugely inflated - and could still crash at any time.

Andersen and Microsoft link up in $1bn deal

Andersen Consulting agreed to set up a joint venture with Microsoft worth $1bn aimed at offering traditional companies e-commerce solutions based on Windows 2000. The company, called Avanade, will involve Andersen creating an internal group of consultants dedicated to applications of Windows 2000. The company's formation mirrors a similar relationship Andersen formed with enterprise resource planning specialist SAP for its R/3 enterprise software. Microsoft entres the market for building large-scale applications for multinational companies.

$9bn merger creates e-commerce giant

E-commerce software specialists I2 Technologies and Aspect Development agreed to merge in a $9.3bn deal. The link-up, the software industry's biggest-ever merger, is expected to give I2 more customers and will build on an existing alliance between the pair. Separately, I2 concluded a deal with IBM and Ariba under which the three would integrate each other's technology. The deal is the first in the expected creation of a series of e-commerce juggernaut suppliers.

Internet secrecy law runs into heavy flak

The UK Government introduced its controversial Regulation of Investigatory Powers Bill amid criticism from Internet service providers and civil liberties campaigners. ISPs fear they will be landed with significant costs to meet the Government's technical interception needs, while campaigners complained about an onus on defendants to prove any inability to provide a decryption key for law enforcement groups when required. City experts doubted claims that banks were prepared to pull e-commerce operations out of London and base them in countries with more liberal regimes.

Cable & Wireless plans e-business super-hub

Cable & Wireless unveiled plans to spend more than £100m building one of Europe's largest Web-hosting centres in Swindon. The centre, due to open in the summer, will be part of Cable & Wireless's bid to create a private "motorway" to serve both bricks-and-mortar companies and dotcoms eager for Web-hosting facilities. Cable & Wireless said company IT directors now had to start getting to grips with how they would provide effective systems to guarantee the uptime of corporate Web efforts.

Hackers cause trouble for Internet giants

A string of Web giants, including Yahoo, Amazon and CNN suffered hacker-inspired denial-of-service attacks, which effectively froze their Web operations. The continuous attacks on Web sites by bombarding them with messages, led to a high-powered US government security summit over the increasing power of hackers. There were also calls for companies to ensure that hackers looking for a third party from which to conduct their attacks could not hijack their internal corporate systems. E-commerce sceptics claimed the attacks proved that Web systems were inherently insecure.

E-procurement exchange partners in position

Commerce One, Ariba and Oracle embarked on a frenzy of announcements regarding business-to-business exchanges for various business sectors. Partners lined up by the companies in separate agreements included Sears and Carrefour in a retail exchange, Chevron and Wal-Mart in a small convenience stores network, ISPAT in a metals network, and an exchange covering the newsagents marketplace. Many of the deals were concentrating on potential savings through e-procurement.

New domain names decision delayed

The Internet Corporation for Assigned Name and Numbers (Icann) has put off a decision on the introduction of new domain names until a meeting in Japan in July. At a recent meeting in Cairo, the organisation unveiled plans to give Net devotees a grass roots vote to appoint "at large" directors to represent them in negotiations. The move is the latest in a series of tortuous efforts to create Internet democracy amid complaints that Icann has been too slow-moving to enable the creation of an up-to-date naming system that also respects the rights of trademark-holders.

Car giants merge supply chain systems

General Motors and Ford agreed to merge their respective supply chain management systems, tying up a third partner in the process, Daimler-Chrysler. The newly-merged systems deal makes partners rather than rivals of Commerce One and Oracle who were working separately with the car giants. Daimler-Chrysler's technology partner is expected to be SAP. The new supply chain network is expected to save hundreds of millions of dollars in procurement costs, with other car manufacturers such as Toyota and Honda also expected to participate. The agreement will force rivals such as Commerce One and Oracle to work together for users' benefit.

Too much consumer protection?

A string of "trust" organisations designed to protect the Internet consumer have been set up, but there has been confusion over their roles. TrustUK, set up by the Direct Marketing Association and the Alliance for Electronic Business, and another set up by the Interactive Media in Retail Group were said to be at odds, while the Consumers Association, which backed the TrustUK scheme said it would keep its own Web Trader scheme running. The TrustUK scheme was unveiled with government backing from e-minister Patricia Hewitt, but the crowded market for "trust" organisations is in danger of diluting the clout of all of them.

Legal ruling bans use of trademarks as keywords

Cosmetics group Estee Lauder won a court case in Germany preventing Net companies Excite and iBeauty from using Estee Lauder trademarks as keywords to trigger banner ads on Web sites. The cosmetics giant said the court had agreed that Excite's sale to iBeauty of trademarks such as Estee Lauder, Clinique, and Origins as key words amounted to unfair competition under German law. The case, one of the first addressing advertising in cyberspace, is the latest in a series of test judgements likely to create Internet "case law".

Andersen scheme aims to stem dotcom drain

Andersen Consulting launched a new initiative to attract and rewardhigh-performing employees. The company plans to invest $200 million in e-commerce-related companies on behalf of its employees and intends to continue investing another $100 million each year. The wealth created by these investments will be distributed to employees as "eUnits", a form of compensation that harnesses the value of the electronic economy. The move is intended to prevent any large-scale exodus of Andersen staff to dotcom start-ups, and demonstrates the extent to which companies will have to find imaginative ways of keeping their best staff.

US firm in dock over sale of Internet user data

US firm DoubleClick was at the centre of a row over online privacy, when a series of consumers filed lawsuits against the company for alleged infringement of their rights. DoubleClick was accused of tracking Net users' Web surfing habits, with a view to selling on the data to other companies. The row is unlikely to be the last alleged infringement of users' privacy rights in an increasingly contentious battle between marketing companies and Web users.

EC wants tax on digital products

The European Commission wants to introduce a tax on the sale of digital products, which would be at odds with US-inspired efforts to keep taxes off Net products. A proposed draft directive would add VAT to products such as software, music, and videos. Brussels lobbyists, including IBM, which warned that rules relating to e-commerce taxes would be too complex, condemned the plans. Meanwhile, in the US, traditional bricks-and-mortar companies claimed a Net tax moratorium was unfair, and called for parity with Net companies over taxation.

Barclays appoints e-guru

Barclays Bank has appointed a new electronic commerce and IT guru to re-engineer all the company's IT systems to exploit e-commerce. The bank has a three year programme which includes building an IP network to link 3000 branches to its head office systems; replacing desktop PCs with thin client technology; introducing WAP, TV, and kiosk banking services; and offering electronic procurement to business customers.

Secure Internet trading scheme set up in UK

A string of UK banks have set up a scheme to generate a more secure trading environment for the Internet. The scheme is being developed by the Association for Payment Clearing Services and will be based on a system of digital certificates, or electronic identities, which are unique to individual businesses. Certificates will be issued by the participating banks on behalf of their business customers, providing them with unique proof of identification similar to a passport. It is anticipated that the scheme will go live towards the end of the year.

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