South Africa is on the brink of joining the worldwide flurry of business on the Internet, writes GREG GORDON|
Global market at users' fingertips
Commerce is what drives development and it has become the Internet's prime focus
SOUTH AFRICA's Internet industry is taking shape. The announcement this week that Absa is on the verge of enabling on-line transactions over the Internet will boost electronic commerce, and other banks are expected to announce their Internet plans soon.
Businesses worldwide were fairly slow to pick up the commercial potential of the Internet. Today's Internet is a descendant of the ARPAnet network established more than 25 years ago and used by US defence researchers so that if one site was destroyed in a nuclear attack, others would retain critical information.
The ARPAnet grew from four computers in 1969 to more than 1 000 in 1984.
In 1986 the US National Science Foundation set up NSFnet to make network connections available to more research institutions and to improve international links.
By 1987 the Internet served more than 10 000 computers and two years later more than 100 000 computers on 650 different networks.
ARPAnet was formally discontinued in 1990 but the Internet continued to grow, with the number of users passing the one million mark by 1992.
Last year, the Internet linked 6,5 million computers around the world on 62 000 local networks.
Although it's difficult to determine how many people use the Internet right now, figures range between 40 million and 60 million. The commercial benefits of reaching those users is obvious.
It took a small company, Netscape, with a product called Navigator, to open up the World Wide Web, a popular environment on the Net because it is graphical. Nowadays some Web sites offer sound and video too.
Netscape was popular with US investors and its share price jumped from $27 to $71 when it was listed on the New York Stock Exchange last year. Investors had confidence the Web was worth throwing money at. It sold 45 million copies.
But waiting in the wings was software giant Microsoft. Initially short-sighted, its Internet strategy was virtually non-existent just over a year ago. Last month it toppled Netscape as king of the Web browsers with its Explorer software.
Netscape will now concentrate on the smaller but more lucrative business market.
The Internet is the marketplace of a not too distant future. At one time the whole ethos of the Net was that it was a forum for free speech and virtually free worldwide communication - any concept of business was frowned upon.
But commerce is what drives development and it has become the Internet's prime focus.
South African companies that want to use the Web as an effective business tool are on the brink of exciting opportunities.
Industry analysts have said that banks providing electronic transactions over the Net were the last stumbling block before on-line trade went mainstream. Absa's announcement that its Web site will soon allow financial transactions should generate a flurry of commercial activity. What will be interesting to see is how quickly other financial institutions follow suit.
South Africa already ranks 14th among countries most connected to the Internet, which some experts say will make it easy, for the first time, for local businesses to trade globally. What is more likely is that domestic trade will be spurred by the Net's convenience. Whichever happens, and a bit of both is bound to, the Internet means business and South Africa is ready for it.