TABLE 2 E Commerce Sales, 2000
B2B trade in
B2C trade in
% E commerce
Sales of GDP
Source: IDC, Internet Commerce Market Model, Version 8.1 (2002).
Germany leads Europe in terms of the total number of broadband connections, which has
increased at a rate of 15 times over the last two years, partly because deployment of services
began earlier there than in many other markets, as well as an aggressive strategy pursued by the
telecommunication service providers. In 2002, 3.9% of all inhabitants or 3.2 million high speed
broadband connections were established in Germany. In comparison, only 2.3% of the
population in the U.S. had access to digital subscriber lines (DSL) (EITO, 2002).
Since becoming one of the first European countries to unbind its local loop, competitive access is
technically available. In addition, Germany is one of the first European countries to offer
commercial line sharing services. Competition, forcing the reduction of local voice tariffs and
the increasing reliance on mobile services, is the major inhibitor of growth in the fixed line area
in Germany. Carriers are looking for alternative ways to generate revenues, including DSL
services (EITO, 2002).
In the mobile area, data still represent a small amount of the overall traffic, but that is expected to
change. German mobile carriers already offer some mobile applications, which include GPRS
based location based services and Internet access. More advanced mobile multi media services
(MMS) are also available on GPRS networks. These services combine text messages with sound,
pictures and video. In March 2002, German mobile phone operator E plus was one of the first in
Europe to launch location based I mode services that allow subscribers to search for restaurants,
cinemas, ATMs, hotels, etc. on their mobile phones (Beck et al., 2003), (EITO, 2002).
Aside from the overall availability of e commerce enabling technologies at the country level, the
usage of e commerce solutions at industry levels is also entering an advanced stage after the
completed first usage and experimentation phase.
The overall e commerce readiness in German industry is high when considering the figures in
Table 3. However, it must be kept in mind that this survey represents only advanced users, rather
than German firms as a whole. It is worth noting that the observed readiness is not only present
among large firms, but also SMEs. While often the existence of a digital divide or digital
gap is mentioned in the literature, only slight differences are evident between SMEs and large