A new man in town

What is the US e-business climate under president George W Bush? Asks Stephen Phillips

What is the US e-business climate under president George W Bush? Asks Stephen Phillips

With the dust finally settled on last year's disputed US presidential election, e-businesses can take stock of what it means for the world's-biggest national market to have a Republican in the White House for the first time in eight years.

The man who won the popular vote, but lost the Florida Electoral College and with it the race for the Oval Office, was famous for his advocacy of the Internet. An unabashed technophile, Al Gore tirelessly used his vice presidency as a soapbox to promote the Internet as it exploded from a closed US government and university network into a global phenomenon during their two terms in office.

George W Bush, however, is a different creature. His reticence about the Internet and e-business during his campaign and first two months in office make him an unlikely candidate to emulate the missionary zeal that infamously led his political foe to claim he "took the initiative in creating the Internet".

Bush made the move to Washington DC from the seat of the Texas governorship in Austin, one of the US's major IT corridors - home to Dell and a slew of other computing companies - and counts Dell CEO Michael Dell and Intel CEO Craig Barrett among his political allies. But his IT credentials stop here.

The US e-commerce community is already lamenting missed opportunities from the new Bush administration. Strongly-fancied Floyd Kvamme, a partner at high-powered Silicon Valley venture capital firm Kleiner Perkins Caufield and Byers, was passed over for Secretary of State for Commerce, in December - an appointment that would have installed a tech-savvy industry veteran at the helm of US e-commerce policy-making. Bush plumped, instead, for his campaign chairman, chief fund-raiser and old Texas oil field buddy, Donald Evans. For Dave McClure, chief executive of the US Internet industry association, a lobby group representing a cross-section of the country's Internet service providers and hardware and software vendors, the answer is simple. "He's not a techie."

Aside from an emphasis on maths and science learning in schools as part of a drive to generate a more technology-literate future US workforce, the Internet is not one of Bush's legislative priorities. "It is the economic agenda first, followed by education, and [then] social security. He's going to be a busy guy pushing these through," says McClure.

Nevertheless, Bush's presidency will be no less critical for lawmaking that charts the future course of e-business for its low visibility on the Oval Office radar screen. The legislative agenda is choked with proposed Internet bills that carry major implications for the US e-business climate. Topping the agenda are no less than seven proposed online privacy bills that would, with varying degrees of strictness, police Internet surfers' privacy, removing a major barrier to consumer e-commerce adoption and smoothing trading relations between US e-businesses and European consumers. Legislation could range from the Hollings bill, requiring e-businesses to elicit express permission from consumers to use their information for marketing purposes, to the McCain- Kerry bill putting responsibility on consumers to "opt out" of commercial usage of their data.

Government regulation of online privacy enjoys broad bi-partisan support and would address consumer privacy concerns that cost $2.8bn in lost e-business in 1999, according to Forrester Research. It would also bring the US more in line with European privacy regimes and help defuse the mutual mistrust that has characterised relations between US dotcoms and European regulators and consumers.

Other critical e-business-related legislation includes bills to facilitate the deployment of high-speed, broadband Internet access that would usher in richer e-commerce opportunities. A bill proposing an industry standard for access to satellite, wireless and cable platforms has been pledged for later this year and the House Internet Caucus has been campaigning to rally cross-party consensus around it.

Meanwhile, despite his low-key attitude to the Internet, Bush's pro-business economic manifesto addresses many of the e-commerce industry's wants. He has pledged support to extend the US moratorium on Internet taxes, forestalling possible state legislation that, according to industry representatives, would saddle e-businesses with crippling bureaucratic overheads from having to file tax returns for customers in individual states.

The message is clear; e-businesses can expect a benign trading environment in the US under its 43rd president, but the ride will only be as smooth as generally challenging economic conditions allow.

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