Forrester`s John McCarthy opened the Ignite 2000 conference at Sun City yesterday by explaining to the 300 delegates and vendors how the Internet will create new e-marketplaces.
Drawing parallels with the automobile industry throughout the talk, McCarthy used the analogy to describe how the Internet will revolutionise business to such an extent that the entire culture of business philosophy will change.
According to McCarthy, e-commerce will reach a threshold where "hypergrowth" will kick off.
To reach this stage, an economy must not be hampered by over-regulation, and government has to take the initiative in this area to free up the economy to operate within its predefined perimeters.
McCarthy believes one of the main challenges facing economies is to become part of larger trading blocks. This will allow them to leverage off a bigger marketplace and create a much bigger revenue base.
Forrester estimates that by 2004, $6.7 trillion or 8.6% of total global sales will be transacted over the ether within these new e-marketplaces.
"At the moment, the US is closest to hypergrowth, with Western Europe closely behind. However, one of the biggest obstacles that stands in the way of Western Europe is that it is still too regulated, which prohibits the process," said McCarthy.
"Asia Pacific is about two years behind the States, then follows South America, Eastern Europe and finally Middle East and Africa."
Operating within new e-networks, firms will form relationships quickly in a mercenary fashion and early software adoption will determine the dominant player in the field.
Similarly, company information will be shared freely among businesses and not jealously guarded as it is now. According to McCarthy, sharing as much information about a company as possible will give it the edge over competitors.
McCarthy is adamant that companies must become highly specialised to function profitably within the new e-networks. "Highly specialised firms operating within these new networks not only have a better chance of surviving, but will be able to actively compete with the bigger, monolithic companies," he said.
McCarthy concluded that government has to set a precedent by deregulating the telecommunications industry before companies can profitably interact with one another in the new e-networks.
"If allowed by legislation, we will end up with a resilient structure of interdependent players cooperating in real-time over the Net."
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