Electronic commerce

Big portals

According to the magazine Commercio Electtronico, in December of 1999 the number of electronic commerce web sites totaled more than 500. In 2000 this number increased to 1,200 and growing.
(Source: Commercio Elettronico, December 1999)

The e-commerce craze is reshaping the strategic thinking of the country's biggest companies. Telecommunications giant Telecom Italia recently agreed to combine its Tin.it Internet subsidiary (www.tin.it) with the yellow pages publisher Seat (www.seat.it) to form what will be the countries leading e-commerce group with 2.6 million subscribers and 180 million web site views a month. Omnitel, Italy'' second biggest mobile phone group, will launch a new e-commerce site on its portal "2000 Shop Center" to offer goods from more than 100 leading brands.
(Source: Italy gets digital; Europe, May 2000)

Main portals are:

• www.kataweb.it
• www.tin.it
• www.netscape.it
• www.everyday.com
• www.msn.it
• www.2000.omnitel.it

Obstacles for e-commerce

• cultural and structural reasons. There is a low usage of computers in the household and in schools. If the success factors for online shopping are similar to the ones for mail order catalogue, Italy is at a disadvantage because of its poor success with mail order catalogue ventures.
• Country's retail system. Italy's traditional network of small shops is one of the most fragmented in Europe. Italy is known for having numerous small retail shops rather than big chain stores and/or shopping malls. Sales from the top ten sites presently account for 40% of total on-line sales, and the lack of any real competition has kept prices top-heavy.
• Low usage of credit cards.
• Poor infrastructure. In a recent study by EU, Italy and Portugal won the European Internet wooden spoon. In Italy it takes an average of 13.2 minutes to place an order on the Internet, 15.7 days for the goods to be delivered and costs an average of $6.87. Those numbers in the UK are 8.4 minutes, 4.1 days and $4.36 respectively.

Opportunities

• Largest number of mobile phone users (in the last three years usage has grown from 6.4 million to 30 million). With new UMTS and WAP technologies on their way, the mobile phone should foster Internet use at both consumer and business levels as well as increase Internet literacy.
• Wealth of small and medium-sized companies (SMEs). For years they have been the powerhouses of Italian industrial growth and many are now turning to the Internet as a means of maintaining their competitive edge on international markets, which account for about 70 % of sales.

A study by AT Kearney has found that SME online sales in 1999 totaled a mere $130 million, a sum that is projected to grow to just $387 million in 2000. While 67% of SMEs see Internet potential, 38% remain unsure. Nonetheless in the next two years 70% of SMEs will go on-line with a catalogue, 64% will accept on-line orders and 36% take electronic payments.

Supporting legislation

Currently in Italy there is no specific legislation ruling e-commerce transactions. Presidential Decree N.513 of November 1997 and relevant applicable technical regulations introduced with Presidential Decree dated February 8, 1999 state that an electronic document, the storage on electronic supports as well as the transmission with electronic instruments are valid and binding on condition that they are performed according to the provisions set forth by the law itself.

In addition, pursuant to the above mentioned provisions full legal effect is given to agreements executed by means of electronic instruments or by means of data processing to the extent that they are undersigned with a digital signature that needs to be certified by certification authorities.

Legislation still has to be passed in following areas:

• Privacy protection of the parties involved in the e-commerce;
• Customer's trust
• Protection of the intellectual property such as trademarks and domain names
• Safety measures in the money transfer transactions;
• Fiscal profiles of the electronic transactions

Some of the above-mentioned issues have been addressed by the Italian legislation through the implementation of EU directives (such as the long distance selling directive). Currently this gap in the law is being filled through the application of the existing legislation to electronic transactions. This analogical application occurs for instance in the field of the intellectual property or with respect to the choice of the applicable law, where basic principles stated by the Rome Convention are still being applied.

Secure servers per 1 million inhabitants
(Source: http://www.oecd.org)

	Sep-97	Feb-98	Aug 98	Feb 99	Jul 99	Jan 00	Mar-00
Iceland	36.6	36.2	47.1	100.5	104.1	161.6	193.9
United States	27.6	40.9	60.8	89.9	116	147.7	170.4
Australia	13.6	24.1	36.6	53.9	69.8	105.7	119.1
New Zealand	15.4	22.7	26.6	46.8	59.3	83.3	92.7
Switzerland	8	13.8	24.1	41.3	54.6	81.8	91.5
Canada	18.1	30.6	33.5	49.5	58	74.6	87.1
Luxembourg	7.2	9.5	28.4	42.2	61	75.1	86.8
Sweden	6	10.5	20.7	33.6	45.7	63.5	71
United Kingdom	6	9.2	14	21.3	29.5	47.4	55.2
Finland	3.9	7.4	15.7	24.8	34.8	47.8	54.4
Norway	5.2	9.5	14.5	22.7	29.3	44.6	49.3
Ireland	4.6	9.2	16.6	17.5	26.2	42.1	47.8
Austria	3.2	7.5	13	23.1	29.5	40.5	42.1
Denmark	2.1	5.5	10.1	13.8	21.2	33.7	39.8
Germany	1.8	4	6.8	13.2	19.8	29.5	34.5
Netherlands	4.8	6.8	9.4	15.5	19.4	25.8	29.4
Belgium	2.1	3.5	5.1	11.4	15.7	21.2	23.6
France	1.1	2.4	4.3	7.6	10.7	15.9	18
Spain	3	4.6	6.7	9.3	10.9	14.3	15.6
Japan	1.6	2.5	4.2	7.6	9.2	12.9	15.4
Czech Republic	0.6	1.3	2.5	4.5	8.6	10.6	13
Italy	1.5	2.7	3.4	5.3	7.5	9.6	10.8
Portugal	1.6	1.9	3.1	5.1	6	8.8	9
Greece	0.5	0.8	1.4	2.8	4.5	5.6	6.5
Hungary	0.7	1.1	1.9	2.4	2.6	4.3	4.9
Korea	0.4	0.7	0.9	1.9	2.3	3.4	3.3
Poland	0.2	0.2	0.7	1.2	1.6	2.5	3.1
Turkey	0.1	0.1	0.2	0.6	0.8	1.2	1.5
Mexico	0.2	0.3	0.3	0.5	0.6	1	1.3

Source: Netcraft, OECD.