Australian Government Funds B2B E-Commerce

Giving a boost to business-to-business (B2B) e-commerce Down Under, the Australian government announced Tuesday it would be handing out US$6.64 million in funding for B2B projects over the next five years.

The Information Technology Online (ITOL) grant program offers grants of up to $102,000 for B2B projects across a wide range of industries and, according to the Australian government, serves as a catalyst for the adoption of B2B e-commerce.

The latest round of funding is the sixth round of ITOL grants. Additional rounds of funding are expected to be announced later this year.

“The benefits from servicing customers online have already proved significant,” Senator Richard Alston, minister for communications, information technology and the arts, said about ITOL in January. “However adopting online solutions in business supply chains could deliver even greater rewards for business.”

Alston added: “ITOL is designed to accelerate the national adoption of B2B electronic commerce solutions, especially by communities of small and medium enterprises.”

The Fine Print

Eligible projects must be supported by a consortium of at least three organizations, which may include companies, tertiary institutions, business or industry associations, government agencies, educational institutions, and other not-for-profit organizations.

Funding is available for up to 50 percent of eligible project costs. Approximately $1.53 million of the $6.64 million will be available to fund project costs in 2001 and 2002.The deadline for the latest round of grant applications is August 20th.

Success Stories

The Australian government has already handed out almost $3 million in grant funding to over 70 projects across a wide range of industries, including social services, tourism, livestock management, e-procurement, health, and the automotive industry.

Success stories include the MarketBoomers project, which is working to establish an online trading community for the hotel and hospitality industry in Queensland, and the Pharmaceutical Electronic Commerce and Communication, which is bringing e-commerce to the manufacturers of health-care products.

Other projects funded in the past include Screen Commerce Australia, an online program to track film projects down under, and E-Global: Aged Care Online Portal, a network designed to provide e-procurement and other services to retirement homes.

“Demand for ITOL collaborative grants has increased significantly, as Australian companies take advantage of the benefits arising from doing business online,” Alston said.

E-Commerce Down Under

Australian e-commerce is showing signs of growth, but there is still room for improvement, researchers say.

A report released in January by consulting firm Ernst & Young predicted that Australian e-commerce will grow from $3.1 billion in 2000 to $39 billion in 2004. The number of Australian e-shoppers is also set to increase, Ernst & Young said, from 2.2 million in 2000 to 5.84 million in 2004.

However, a report released in May by IDC said that most small businesses in Australia are “barely active” in e-commerce because they are not convinced of its benefits. The market research firm said that 56 percent of small businesses it surveyed currently have no Internet-related revenue, and forecast that the figure could drop to 46 percent over the next 12 months.

“While a significant minority of small businesses will never reach or have no need for [e-commerce],” IDC said, “the survival and prosperity of many other businesses in this sector depends on them adopting e-commerce.”