Information highway or road to nowhere?

Love it or hate it, the Internet is here to stay; it pervades every aspect of life, be it business or social. You can buy groceries, run your business and book restaurant seats - all from a computer.

E-mail usage is omnipresent for those with an Internet connection. How could we have survived without it? Then there is the wealth of information that exists at the touch of a button - or does it?

The enduring gems of online success appear to come from within the IT industry.

Tony Farah, Executive Chairman, Spescom.

The simple answer is `yes` it certainly does - but it is still largely confined to society`s 'haves` on the recreation and even education fronts. The digital divide, or the gap between the information haves and have-nots, has been defined and monitored, and is reported to be widening at an alarming rate. Even in the US, the birthplace of the Internet, the digital divide is regarded as an issue of concern.

The Internet was launched onto the world stage in the early 1990s amid a plethora of promises and forecasts claiming that business, education and recreation activities were about to be revolutionised. What were those promises and has the Internet delivered?

On the business front, massive growth in online consumer purchasing was predicted and with it the demise of brick-and-mortar companies. This has certainly not materialised. Consumer confidence in online buying has grown but not before many companies became casualties of the dot-bomb era.

The few survivors, like Amazon.com, have not had an easy ride; Amazon.com entered profitability for the first time in January 2002. While analysts hailed the announcement as a red-letter day for e-business, they did so with caution due to the virtual company`s reputed massive long-term debt.

In the post-Enron environment, the US analyst community has expressed concern that other companies may be suffering from what is being euphemistically referred to as "Enronitis". This entails the use of allegedly creative accounting practices geared to produce great headline returns while the fine print reveals another story.

The enduring gems of online success appear to come from within the IT industry, with multi-national corporations, like Cisco, Oracle, GE and IBM, implementing highly effective Internet usage for their supply chains. Dell has a persistent growth pattern and returned healthy fourth quarter revenues in February, with analysts claiming a three-point increase in world market share for the online company.

Interestingly, Dell declared that performance had outstripped expectations due its fast-growing consumer business. This trend in Dell`s business is borne out by forecasts from research houses, notably Gartner, which predict that in 2002 consumers will, at last, go online. The number of consumers using online account management is expected to double by 2005.

The travel industry is a sector that is particularly well geared towards e-business, with SouthWest Airlines in the US announcing last year it had turned a $1.7 billion profit from its Web site. Remarkably, despite the events of 11 September, which have had a devastating impact on the travel industry, SouthWest announced in late February that it is recruiting 4 000 employees, proving that its business model is working.

Last year, South African Airways unveiled its e-commerce-enabled Web site, flysaa.com, and declared that it intended to globalise its e-reach programme in an attempt to maximise online profits.

In SA, online banking proved to be the method of choice for consumers. Despite the well-publicised problems of SA`s first virtual bank, 20Twenty, which boasted over 40 000 clients, patrons rallied around their online connection while the run on the brick-and-mortar holding bank continued relentlessly.

E-learning could possibly be regarded as a killer Internet application, but how widely is it utilised? Again on the home front, the Schools-on-Line programme aims to establish Internet learning centres that target disadvantaged communities. The initiative, while still in its infancy, certainly holds great promise.

Social upliftment was one of the great promises of the Internet, but with fewer than 2% of the world`s population actually connected and more than 80% never having heard a dial tone, this has hardly been realised.

Slow access is certainly still a limitation. The number of broadband users is relatively small. Furthermore, the pace of broadband roll-out and/or adoption is slower than was anticipated. In fact, many broadband service providers in the US and elsewhere have gone under.

Online entertainment like video on demand has not yet become readily available, nor is it as successful as once anticipated. However, online porn is hailed as a major success!

Collaborative working and information sharing has been made possible by the Internet and this undoubtedly speeds up time-to-market for new products.

When cyber-history is finally written, the Internet will unequivocally be recognised as the catalyst that took the world closer to the brave new information age, but in 2002 the full promise remains an ideology and not a reality.

Therefore, it`s not so much that the emperor has no clothes, but rather that he is not yet fully dressed.

(Research statistics were sourced from Arthur Goldstuck and Gartner.)