RULES IN CYBERSPACE?

Dave McCombs was right on in "The Digital Fortune Cookie: E-Commerce Retailing in Japan" [ACCJ Journal, October 1998]. He predicts that e-commerce won't take off in Japan until phone rates come down, security measures are properly installed and Japanese consumers feel comfortable shopping online. But one factor that's always underestimated in the development of new industries in Japan, industrial policy, isn't addressed.
     Think about it: what is e-commerce but a potentially open, efficient and "culturally neutral" distribution channel? It may seem incredible that Japan's government could shape the rules of cyberspace in the 21st century as it did the distribution landscape in the second half of the 20th, but does anyone doubt the possibility of keiretsu rules in cyberspace? The telltale signs are already here. Plenty of intra-ministerial and "private" committees, councils and study groups are currently shaping the rules of doing business in cyberspace. Some seven ministries are involved. Then there is ECOM, the private consortium partially funded by the Japanese government to come up with guidelines, model contracts, standard agreements and other quasi-legal mechanisms designed to "systematize" the online business process. To answer the question McCombs poses, "When will e-commerce take off in Japan?," you must pinpoint when the Japanese government will feel confident enough that the Japanese businesses which stand to benefit from unbridled Internet usage are sufficiently savvy, technologically and commercially, to compete with their foreign counterparts. When it does, you will likely see significant change.
     This old-fashioned view of market development will likely retard growth of online business in Japan by forcing the Japanese consumer to, once again, settle for second best ? or at least for inefficiency. This is ironic. Our analysis of Japanese Internet use and online commerce clearly shows that there is a vast commercial opportunity in the Internet in Japan and that the winners will likely be the fastest, most experimental online sellers, not the most "organized" old-line manufacturers. Government-industry efforts that are sure to throw up new roadblocks in the way of market development will severely mitigate any positive effects of removing the cost, security and experience barriers. When will e-commerce take off in Japan? You won't find that answer in a fortune cookie.

Rachel Howe
DSA Analytics, LC