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SMEs in the electronic commerce era

The proposed programme has three modules: training in the major features of the Internet, electronic commerce and intellectual property.

In this era of the new economy, small European companies cannot ignore electronic commerce. Not all of them, however, have the means and skills needed to take this great leap into the unknown. Thanks to the Peter project, carried out as part of the Esprit programme, they are now being offered a model to master the various legislative and technical parameters which are preliminary to successful trading on the Internet.

Whether the purchasers or purveyors of
productsand services, small and medium

enterprises stand to make substantial gains in productivity from electronic commerce, while at the same time facilitating their international operations. As from 2001, SMEs should account for approximately €30 billion of turnover in the market, according to the International Data Corporation (IDC). For them to successfully enter this market, however, they will have to master a technology which is constantly evolving, regulations which are embryonic and not very homogeneous, security problems linked to orders and payments and specific kinds of advertising and marketing.

"The originality of the Peter project is that it has integrated all these aspects, after detailed analysis, to propose a complete or modulable solution to SMEs adapted to their country and their market", explains Jens Koblin from the German telecommunications company Teles, which is coordinating the project. Over a two-year period, Peter brought together seven companies already setting up virtual shops, five of which were working with customer SMEs to help them launch their own on-line activity.

A toolbox for SMEs

"The Peter project was designed to evaluate, integrate and test existing technologies and to create a toolbox consisting of all the elements required to establish secure on-line sales channels, protected from the point of view of the product catalogue, the treatment of orders and payments", continues Jens Koblin. This concept of a toolbox makes it possible to modulate the architecture according to the frequently very different needs of SMEs; they are offered a programme comprising three modules: training in the salient features of the Internet, of electronic commerce and intellectual property; an analysis of the needs and requirements of the company and its customers in order to maximise the use of an electronic commerce site; and the creation of a fully operational site.

"At the beginning we concentrated on articles such as software and multimedia products, training programmes or consultancy documents which could be delivered in an electronic format and regarding which the security of the vendor's intellectual property rights - what we call IPRs - is as important as that of the customer's data", explains Peter's coordinator. "As identical copies can be reproduced practically infinitely without any loss of quality, these products are the favoured targets of fraud during electronic exchanges. At present, however, we do not have any reliable mechanism for safeguarding IPRs or digital goods."

The other major challenge is that of payment mechanisms. "There is still no universal standard for making electronic payment safe", continues Jens Koblin. "On-line transactions between companies of the same country are no problem, but differences between national banking systems have obliged us to develop a different solution for every country".

This drawback could be mitigated in the future by the adoption and transposition of European Directives now being discussed on the legal aspects of electronic commerce, electronic money, distance selling of financial services and authors' rights, as set out in the e-Europe action plan (1).

Guidelines made available

The findings of this project are now available in the form of guidelines answering the principal questions put by companies regarding electronic commerce. Different software modules proposed by Peter make it possible to benefit from a multilingual catalogue with the possibility of dealing with orders and payments in real time and the automatic calculation of delivery costs. Customers are listed in a database which may be used to send periodic information letters or personalised mail. The system makes it possible to use authentification and certification protocols adapted to transfers of confidential data or subject to intellectual property rights. It is also compatible with the various encrypted payment mechanisms currently available on the market, such as SSL, SET, C?SET and Proton.

As is to be expected in a world which changes as fast as that of the Internet, "the various companies which are partners in the project are still continuing to update their pilot shops by integrating new technologies as soon as they are available", concludes Jens Koblin.

(1) e-Europe 2002, An information society for all, draft action plan proposed to the European Council by the European Commission.

Pilot for electronic marketing and trading in European small and medium enterprises (PETER)



Jens Koblin
Teles Ag Informationstechnologien
Fax. +49 30 39928 01
E-mail :

- Teles Ag Informationstechnologien, Berlin, Germany (coordinator)
- Agesfal - Assessores de Gestao E Formacao Empresarial, Estoril, Portugal
- Sincrotel, Estoril, Portugal
- Authors Licensing and Collecting Society Ltd, London, United Kingdom
- Stichting Kenniscentrum Voor Telematicatoepassingen, Leeuwarden, Netherlands
- Call Consult Service, Brussels, Belgium
- Orsenna, Paris, France

Analysing the needs and requirements of the company and its customers in order to maximise the use of an electronic commerce site.