US slips in e-business 'readiness'

The U.S. has slipped to sixth place in a worldwide ranking of e-business readiness, the worst showing since 2000, when the study was first conducted. The major reason for the U.S. slip is its broadband per capita penetration of only 7 percent, according to the 2004 E-Readines Rankings, done by the The Economist Intelligence Unit in cooperation with IBM Corp.'s Institute for Business Value. South Korea leads the world in broadband penetration with 27 percent, according to the study.

However, the study concluded that "the U.S. continues to make strong strides in e-readiness" and that its decline is due to "other countries making faster progress."

The U.S. ranked first in 2000, 2001 and 2002 and second in 2003. This year, Denmark placed first, followed by the U.K., Sweden, Norway and Finland. Completing the top 10 were the U.S. in sixth place, Singapore, the Netherlands, Hong Kong and Switzerland.

A key to the strong showing of Western Europe as a region is the good coordination that exists there between government and the private sector.

Countries get a score between one to 10 based on 100 quantitative and qualitative criteria, which fall under six major categories: technology infrastructure, general business environment, e-business adoption by consumers and companies, social and cultural influences for Internet usage and availability of support services for e-businesses. Leader Denmark earned a score of 8.28 while last-place finisher Azerbaijan got 2.43.

Although broadband penetration has grown "tremendously" over the past several years, the adoption of 3G (third-generation) mobile services has been a disappointment, with only 22 million out of about one billion mobile subscribers worldwide having 3G, according to the study. About 90 percent of 3G subscribers are located in two countries, Japan and South Korea, according to the study.

The Economist Intelligence Unit is the business information arm of The Economist Group, which publishes The Economist magazine. The Economist Intelligence Unit was responsible for the study's rankings and content, and collaborated with the IBM Institute for Business Value in building the rankings model. -- IDG News Service