Background

Advertising and selling through the Internet is called electronic commerce, or E-commerce. The Internet is growing exponentially, with new servers and Web-sites sprouting nearly everywhere in the world. World-wide Web software technologies are enabling any user to become an information provider of one sort or another and providing any business with a low cost advertising and selling medium. Almost no one doubts the power of the Web to enable businesses to reach literally millions of potential customers at a cost which is nearly independent of the size of the customer base, and which is gradually falling with time. The software for creating Web-sites, advertising, and selling is advancing rapidly, and as distance and location are scarcely a factor, the competition from companies and places that were littleor unknown a short time ago is growing.

On the other hand, very few companies are making a profit in E-commerce today. The reason for this is not clear. It may be that the nature of the market is not well understood and sales techniques for this new medium have yet to be perfected. It may be that technologies for effecting payments, although quite adequate in technical terms, do not yet have public confidence. It also may be that this is a temporary situation, and Internet commerce may explode across industries and national boundaries.

For a variety of reasons, the characteristics of E-commerce seem to favor PEI. For many consumers, PEI is little known and physically hard to reach in a geographical sense, but it is as easy to find on the Web as the largest city or country. The stories of Anne of Green Gables and its place in Atlantic Canada give it a theme and an aura of romance. And in quite another sense, PEI is ready to go. It has a digital broad band backbone across the Island that may be the most advanced in North America, and which could be made accessible to businesses and industries of many kinds. It has a prize-winning official Web-site and a number of private companies with attractive and interesting sites. At a time when Web-based industries are sometimes ''footloose," businesses whose major assets walk out the door every evening at five, and who can relocate to another attractive site with little notice, PEI has a loyal population who appear committed to remaining on the Island if the right jobs are available. Nevertheless, in exploring the advantages of E-commerce in Prince Edward Island in the course of the knowledge assessment, it seemed expedient to base the enterprise on a unique feature of the Island that would not be easy to carry off.

The theme selected is Anne of Green Gables. Familiar, and even tiresome, as it is to Islanders, this is clearly an asset or core competency of PEI. Anne is known throughout the world, driving a significant part of the PEI tourist industry, and offering a fertile basis for chat rooms and Web-sites designed around the novels. It could also be a wedge into the incipient IT industry for girls. A world-class Anne site could become the "anchor store" in a "virtual mall," of electronic commerce businesses located on Prince Edward Island. The anchor store in a



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