The pace at which Information Technologies (IT) have permeated business and popular culture is astonishing. A convergence of mutually-reinforcing factors have created an historic moment in which at times it seems that all things are possible and there are no limits. Technologies that originated as military projects and matured in academia have been fully embraced by innovators and entrepreneurs who have integrated IT into every aspect of business from design to marketing, conducting business across the Internet, thus creating the phenomenon now known as electronic commerce (eCommerce).

Information Technologies, and the associated eCommerce applications, account for a substantial component of the sustained economic growth in the more developed nations. The generally accepted view is that properly deployed IT can reduce operating costs, improve operational efficiency, enhance supply-chain management, increase client satisfaction, and increase the "agility" of the company by enhancing its ability to adapt to changing market conditions. There is no question that the world economy is undergoing a dramatic structural change as IT changes the way business is conducted.

The advantages of eCommerce are many, a few of the most interesting include:

• businesses are always open, seven days a week, twenty-four hours per day;
• the catalogue of goods can change from minute to minute, based upon availability;
• pricing can fluctuate based upon demand;
• fixed overhead is lower than a traditional operation;
• the pool of customers is potentially greater, and, where order fulfillment is easy, the customers are free from issues of proximity to the store or access to a printed catalogue;
• customer information is more accurate, providing a high level of "personalization" of each customer’s on-line experience;
• transactions are closely integrated, with fewer intermediaries, and are essentially paperless, thus reducing costs and providing new opportunities for analysis.

eCommerce is booming, with fantastic growth projections, and given the advantages to both businesses and their clients, it is here to stay. However, eCommerce is in an early stage of development, with regulatory environments and technical standards still in flux. This can be an especially difficult issue for global electronic commerce, as many countries have not fully articulated their respective policies for regulation, privacy, and security.

Electronic commerce is a phenomenon largely restricted to more developed nations, particularly the United States, with their robust telecommunications infrastructure, ubiquitous access to computing devices, well-established systems for payment, and comprehensive systems for order fulfillment.

Indeed, the disparity is so great that it has sparked a new term: the "Digital Divide". Similar to characterizations such as first vs third world, or North vs South, the digital divide separates the digital "haves" from the "have-nots". The factors previously cited which account for the rapid emergence of eCommerce in more developed countries are not as well established in many developing countries: power grids are not as robust and reliable; about 2/3 of the people in the world do not have telephone service; computing devices are not commonly available; people are less exposed to technology; the economies are largely cash-based, with few mechanisms for personal credit; delivery systems are less comprehensive, and less reliable; access to the Internet is exceedingly skewed, with far fewer service providers and substantially higher relative costs in developing countries.

These factors account for the observation that the vast majority (about ¾ of the total) of web sites and Internet users reside in North America or Europe, and almost all eCommerce activity takes place in the United States. While these trends are expected to improve over time, the immediate situation is quite stark.

What, then, are the opportunities for developing countries to "get in on the action"? Where should the national export strategist begin?

1. Accept the fact that it will take years, perhaps generations, before the domestic business-to-consumer (B2C) market emerges as a significant factor in the national economy. It will take time to slowly develop the necessary "critical mass" of consumers and proper infrastructure to support B2C eCommerce, and it is not likely to follow the same path as in the United States; solution strategies will adapt to local circumstances.
1. Embrace the fact that business-to-business (B2B) eCommerce has already surpassed B2C in overall economic activity, and is expected to continue growing at a much faster rate, thus providing significant opportunities for national production to be marketed globally.
2. Recognize the opportunity to coordinate an eCommerce strategy with the national economic development program, and to influence the design and development of the associated regulatory environment.
3. Establish a program to facilitate the development of eCommerce-related enterprises and associated skills through the creation of an eCommerce incubation program that prioritizes export development.

Whether it is selling the work of local artists and artisans to the enormous consumer market in the United States, or selling components to automobile manufacturers half a world away, the immediate opportunities for developing countries in the B2C and B2B markets are global, more than local. The approach might be require relatively few technical demands, such as a simple e-mail based ordering system, or via participation as a supplier in a business-to-business marketplace for goods or services. The demands could also be quite elaborate, requiring a comprehensive integrated system that adheres to a long list of technical specifications for ordering, procurement of raw materials, transaction processing, manufacturing, and delivery.

The technical and policy-level barriers-to-entry to successfully compete in the global eCommerce market can be difficult for individual small-to-medium enterprises in developing countries. In an environment with limited financial and technical resources, it is best to establish a strategic plan and carefully coordinate the development effort. An eCommerce incubator provides an ideal means by which the national export strategy maker can integrate technology assistance and national policy to leverage competitive local advantages into export opportunities.

The short-term goals of an incubator program are to encourage exploration of economic opportunities and develop the capability for competitive participation, and the strategies to make it happen. The long-term goals are to foster the growth of independent, self-sustaining commercial enterprises that provide employment and revenue to the community, build capacity, and strengthen the national economy.

Traditional old-economy incubators emphasized the provision of office and manufacturing space, in order to encourage economic activity in a particular location. More elaborate programs included business strategy counseling, employee training, and financial incentives. The incentives were designed to ease the start-up burdens of new businesses, and often included subsidized rent, reduced cost of utilities, shared office equipment such as reproduction and fax services, significant reductions in taxes, and low-cost access to financial capital.

An eCommerce incubator must do all of this and more, providing a wide range of high-tech services and related capacity development. The building(s) must be relatively modern, with good climate control and widespread network connectivity. A robust Internet channel with substantial capacity is required. The power must be reliable and "clean". Physical security is important to protect the equipment from damage and theft. Training programs must be more technical, with longer-term commitments. The demands are higher, but the potential rewards are also much greater.

High-tech incubators have become popular, even in more developed countries such as Australia and the United States, as a means to facilitate the rapid development of new "digital economy" businesses and to ease the transformation of existing businesses. An incubator typically includes the following components:

the selection of physical facilities (often a single building with multiple occupants, but it could easily be distributed amongst multiple buildings, with good connectivity and strong management);

site preparation

• renovation of physical premises
• installation of surge-protected electrical power with battery backups
• installation of modern telecommunications and computer networking infrastructure
• provision of high-speed Internet connectivity
• installation of computer servers and corresponding software
• desktop computer equipment as part of standard office configurations;

provision of common document reproduction and facsimile services;

site security (machines, rooms, buildings, with security personnel and appropriate access policies);

disaster recovery protocols and procedures;

selection of core eCommerce infrastructure software systems;

ongoing training programs in critical subject areas

• entrepreneurship and eCommerce
• system administration
• system security
• database administration
• web mastering
• web page design and development
• programming;

provision of strategic business planning and technical advice.

The development of human resources is an important component of an eCommerce incubator project. There is a chronic worldwide shortage of technology-trained workers, which is contributing in a non-trivial manner to the "brain drain" of talented workers from developing countries. The brain drain is exacerbated by the fact that some countries have established special categories to encourage the immigration of skilled workers, in extreme cases providing instant citizenship.

A successful incubator program in these circumstances must maintain an aggressive training program. Such a training program could utilize existing educational resources, trade fairs, international conferences, distance learning programs, corporate certification programs, workshops, and routine in-house development seminars.

It is desirable to undertake an incubator approach with clearly defined economic opportunities and development objectives. Selected words of wisdom include:

1. carefully choose the initial pilot projects, and establish the goals in manageable phases – it is easier to build confidence and credibility from small successes, and to refine strategy based upon actual experience than it is to overcome high-profile failures;
2. involve potential partners and/or buyers of goods early in the process, so as to ascertain interest, incorporate suggestions, and facilitate long-term cooperation and supply chain integration;
3. establish a coordinating committee with representation from all of the actors, with high-level governmental participation, as the incubator experiences may affect national development priorities and strategies;
4. changes occur quickly in the digital economy; ensure that the project is subjected to periodic evaluations and "course corrections";
5. be careful to build upon existing strengths, and avoid unnecessary redundancies – for example, if a training program exists at the local university, help strengthen the program, or develop a complementary rather than a competitive program;
6. take the time to investigate similar initiatives - numerous examples exist, and there are many ways to go wrong - incorporate their "lessons learned" into your strategy!

The topic of Information Technology infrastructure has in recent years become one of the most significant factors in the evaluation of prospective sites for international business development. It has also become a major focus area for many international development agencies such as the World Bank and the United Nations Development Program. A strong IT program can serve as a cornerstone for every other development initiative ranging from poverty eradication to child-find programs in areas of crisis.

It is easy to envision a collaborative approach to the creation and ongoing development of a high-tech eCommerce incubator, with support and/or contributions from international aid agencies, multinational businesses, the national government, and the emerging private sector.