The US has slipped to sixth place in a worldwide ranking of e-business readiness.
The major reason for the slip is its broadband per capita penetration of only 7%, according to the 2004 E-Readines Rankings, carried out by the The Economist Intelligence Unit in co-operation with IBM's Institute for Business Value. South Korea leads the world in broadband penetration with 27%.
However, the study concluded that "the US continues to make strong strides in e-readiness" and that its decline is the result of "other countries making faster progress".
The US ranked first in 2000, 2001 and 2002 and second in 2003. This year, Denmark was placed first, followed by the UK, Sweden, Norway and Finland. Completing the top 10 were the US in sixth place, Singapore, the Netherlands, Hong Kong and Switzerland.
A key to the strong showing of western Europe as a region is the good co-ordination that exists there between government and the private sector.
Countries get a score between one to 10 based on 100 quantitative and qualitative criteria, which fall into six major categories: technology infrastructure, general business environment, e-business adoption by consumers and companies, social and cultural influences for internet usage and availability of support services for e-businesses. Leader Denmark earned a score of 8.28 while last-place finisher Azerbaijan got 2.43.
Although broadband penetration has grown "tremendously", the adoption of third-generation mobile services has been a disappointment, with only 22 million out of about one billion mobile subscribers worldwide having 3G, according to the study. About 90% of 3G subscribers are in Japan and South Korea.
The Economist Intelligence Unit is the business information arm of The Economist Group, which publishes The Economist magazine. Theunit was responsible for the study's rankings and content, and collaborated with the IBM Institute for Business Value in building the rankings model.
Juan Carlos Perez writes for IDG News Service