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BUSINESSWEEK ONLINE: Business Week ebiz | |||||||||||||||||
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A New Voice for the Web's Worldwide Business Community The group, known as the GBDe, will try to solve some fundamental E-biz issues. The hurdles are high, but the stakes are even higher Like electricity, antibiotics, or the car, the Internet is a revolutionary technology. But in spite of its incredible promise, the Net is never going to reach its potential unless certain fundamental legal, political, and regulatory problems are solved. Who will collect sales taxes? How will contracts be enforced? What protections are there for intellectual property? And what about safeguarding consumers from fraud and privacy invasion? These issues are critical to everyone with a stake in the Internet -- especially businesspeople. A recent Forrester Research study predicted that the global Internet economy would reach $3.2 trillion in 2003 if these issues are managed well -- but only $1.4 trillion if they're handled poorly. No wonder CEOs are increasingly tuning in to these problems. "Over the next five years, I believe the future of this medium will be determined more by policy choices than by technological choices," America Online CEO Stephen M. Case recently declared. So, in January, Case joined Time Warner's Gerald M. Levin, IBM's Louis V. Gerstner Jr., and top execs from 14 other major companies to establish the Global Business Dialogue on E-Commerce. Their ambitious goal: to create an new organization to be the international business community's primary voice on how to govern the Net. So far, the organization, often referred to as the GBDe, is off to a fast start. More than 200 corporations and business associations have signed on, including America's Sun Microsystems, Japan's Sony, and Germany's Siemens.
SAUDI DECENCY. In establishing the GBDe, Case, Levin & Co. have two primary concerns. First, they don't want every city, county, state, and country to burden cybermerchants with a patchwork of cumbersome and incompatible regulations. Imagine how much harder online business will be if sellers have to keep track of dozens of divergent tax systems and develop separate sales contracts for differing countries. And sites would still have to ensure that they comply with everything from Saudi Arabia's decency standards to the European Union's privacy laws to American encryption guidelines. Inconsistencies abound. At the same time that they seek an antiregulatory agenda in some areas, business leaders are agitating for new laws in others. They're also anxious to see that the police power of the state is there to protect intellectual property and fight fraud. The GBDe's plan is to develop policy papers on these issues as rapidly as possible. Task forces are being established to focus on nine substantive areas, including intellectual property, taxes, privacy, and security. To encourage international consensus, each task force includes participants from Asia, the Americas, and Europe. To speed up deliberations, much of the organization's work will be done over the Web at the GBDe's site, www.gbd.org.
Regional differences are also likely to emerge, though. Unlike companies in the U.S., which generally favor self-regulation wherever possible, European corporations are far more willing to countenance government involvement in areas such as privacy and identity authentication. "Americans have a deep distrust of government. In Europe, there is a stronger feeling that government is there to act for the community good and can do so effectively," says David Post, a Temple University law school professor specializing in the law of cyberspace. DOMAIN NAME GAME. Other divisions are already materializing. Large companies and small companies, for example, disagree on the allocation of World Wide Web addresses. Established companies own lots of well-known brand names, like "Sun," "Target" and "Jaguar," and believe that they should have first priority on domain names such as sun.com or target.com. Startups and smaller companies, on the other hand, argue that terms such as these are too common for one company to own automatically on a worldwide basis. The upstarts believe that domain names, which will be a key element of Internet branding, should be allocated on a first-come, first-served basis. Even if the GBDe is able to overcome these differences, it will still have the problem of winning the confidence of consumers. Moreover, it's going to have to act quickly, because politicians around the globe are devising new measures to regulate the Net every day. But the price of failure is high: a significant diminishment in the bounty of E-commerce. That should be sufficient motivation to fuel the GBDe's unprecedented mission.
Mike France is Business Week's Legal Affairs editor _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ |
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 Mike France is Business Week's Legal Affairs editor WEB POINTERS You can visit the Global Business Dialogue on E-Commerce at www.gbd.org | ||||||||||||
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