Select Committee on European Union Written Evidence

Memorandum by the Institute for the Management of Information Systems (IMIS)


The Institute for the Management of Information Systems (IMIS) is the professional organisation for the management of Information Technology, whether by IT professionals or, as is increasingly the case, by user managers. It was formed in 1978 by a merger of the Data Processing Managers Association and the Institute of Data Processing and changed its name to IMIS from IDPM (the Institute of Data Processing Management) in 1997. It has about 11,000 members, including students, overseas and practitioner members.

1.  What needs to be done to create confidence and stimulate electronic commerce?

  e-Commerce is not synonymous with the Internet. The Internet is not synonymous with the World Wide Web. e-Commerce, the Internet and the Web are all evolving but they are not necessarily converging.

  e-Commerce is doing business electronically. It involves a wide variety of technologies, analogue as well as digital and is not new. The first conventions for international cable traffic date from just after the US Civil War. The first case on whether a cable authorisation is a signature is over 100 years old.

  The Internet is that network of networks across which transmissions can be made using protocols agreed through the Internet Engineering Task Force. These also cover a wide variety of technologies and techniques, including pre-determined routing and physical security infrastructures. Networks using the latter account for most of the investment in hardware, software and communications facilities and around 90 per cent of transactions (including the EDI supply chain systems of the US aerospace, retail and finance industries).

  Internet protocols also cover emerging technologies, from Digital TV and Wireless through to new generation analogue (necessary to handle very high band width using optical technology and increasingly practical as hardware reliability reduces the need for digital error checking).

  The Web commonly refers to that subset of the Internet which uses only packet-switched, any-to-any, delivery "by what route is currently available" with no guarantees. This subset carries barely 10 per cent of the business-to-business transactions which flow over the Internet as a whole but does account for almost all of current business-to-consumer traffic as well as a wide variety of low cost e-mail, advertising and information services. How long that domination will last, with the growth of traffic over Digital TV and WAP technologies (which need very different structures for optimum efficiency) is uncertain.

  Until recently the "Internet" and the "Web" were seen as attractive brand images. In consequence Digital TV and WAP (for mobile phones etc) were seen as giving access to the Web over the Internet. The problem is lack of confidence in the use of low cost, low security, any-to-any, packet switched services (as have been widely promoted over the past couple of years) for anything more than e-mail, advertising, information services and "discretionary spend" by technology enthusiasts.

  These (from the sale of analyses of search habits, through "denial of service" and other hacking attacks to systematic credit card fraud, copying and piracy) are now becoming rapidly more apparent. In consequence we have the first advertising campaigns to distance Digital TV and WAP from the problems of those running services over the Web.

  The "solution" is for those wishing to promote confidence to collect, collate and publish information on quality of service (response times, delivery, payment security etc) akin to that available for other services, from the physical delivery of letters and parcels to the response times and reliability of structured electronic data interchange services and messaging networks.

  More background to some of these points is given in Appendix A—an article intended to help IT Managers improve user expectations as to what can be delivered at what price and to what timescale.

2.  Does the European Commission's draft Action Plan "eEurope: An Information Society for All" offer a realistic means of promoting e-commerce in the EU?

  It is largely irrelevant compared to the use of regulatory and competition policy to encourage commercial suppliers to improve quality of service and provide authentication, credit checking, payment and dispute resolution routines. The sections on education, training and social inclusion omit the need to achieve economies of scale and ease of use necessary to enable affordable access for the majority of society. IMIS strongly supports the comments in EURIM Briefing 18 Reskilling Europe for the Information Society.

3.  Will codes of conduct and co-regulation provide sufficient protection? Is there a case for intervention by national governments and the EU?

  IMIS believes that the same law should apply online as offline, despite the problems this gives to some of our members (see Appendix B). The reason for the difference between the views of IMIS members and those of other computer professionals is probably that Managers are more likely to have family responsibilities as well as those for delivering results for their employers (whether suppliers or users).

  IMIS also agrees with the EURIM analyses, in particular

    "There is a need to distinguish between situations where both parties are acting in good faith but the transaction fails to give satisfaction and the need to suppress deceit, fraud and other malpractice. The latter cannot realistically be left to self-regulation and requires frameworks for co-operation across borders between statutory regulators and law enforcement agencies . . ."

4.  Do the institutions of national governments, on the one hand, and the European Commission, the Council of Ministers and the European Parliament, on the other, function with sufficient flexibility and coherence to promote the EU's objectives in the field of e-commerce?

  IMIS' particular concern is that policy debate appears to be dominated by a small group of dominant technology and communications suppliers on one side and an equally small group of dominant content providers on the other. The interests of mainstream business and of consumers do not appear well represented. Indeed the latter often appear to be "represented" by self-appointed protectionist lobbies whose aim appears to be to protect them from choice.

  This problem is long-standing and will not be solved unless and until Her Majesty's Goverment and the Commission use commercial market research techniques (eg large-scale structured telephone surveys to structured panels which are representative of the target audiences) on a regular basis to identify the evolving views, needs and priorities of both users and consumers (segmented as necessary by geography, vertical market, type of purchase etc).

5.  Should existing EU institutional structures be changed, or new ones created, to improve policy development and co-ordination?

  IMIS believes that it is more important to encourage and support the growth of organisations like EURIM, which cut across organisational and political boundaries, than to seek structural changes which are likely to be wrong before they are agreed.

6.  How can structural change be brought about fast enough to accommodate the growth of e-commerce?

  e-Commerce has been run for many decades over a variety of technologies and that mix continues to evolve. The "Internet" (as viewed by the Internet Engineering Task Force) is "merely" that latest stage of evolution of the world's largest machine, the global telecoms network. As such it embraces a wide range of protocols of which "any-to-any packet switching" is only one.

  Some members are already planning on the basis that the current "ISP" and "Portal" business models will be obsolete even before Digital TV and WAP protocols transform the delivery routes and audiences for mass-market e-commerce. Meanwhile business-to-business appears likely to remain dominated by structured EDI concepts, albeit often using TCP/IP protocols with webaccess for those new to the value chain.

  IMIS is concerned lest change to the basic principles of international trade to accommodate the problems of what may prove a transient approach to a sub-set of e-commerce (low security, any-to-any transmission) distorts the need for political, legal and fiscal policy toward e-commerce to be technology neutral. We are also concerned over the need to better distinguish between skills and disciplines, including those related to the development and use of new technology, which change little over time and those where change is rapid and traditional approaches can no longer cope.

21 February 2000

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