Information Technology Demystified

A Report from the UniForum Technical Steering Committee

Electronic Commerce and the G7 Initiatives

Major industrialized nations are working to address worldwide public-policy issues associated with electronic commerce.

By Marty Tenenbaum and Jim Johnson

At their 1994 annual meeting in Corfu, Italy, the leaders of the Group of Seven (G7) industrialized nations (Canada, France, Germany, Italy, Japan, the United Kingdom and the United States) resolved to address the growing public policy issues caused by the dawning of the Information Age. The international growth of the Internet, the rapid development and adoption of new forms of software and information technology, and telecommunications were beginning to force world leaders to understand the need to adapt laws, regulations and government policies to the new paradigm of a global information society.

The G7 countries called for a conference of their cabinet leaders in trade and telecommunications to meet in Brussels in February 1995. From that meeting came a list of 11 project areas, which the nations resolved to address in terms of policies to facilitate the social and economic impact of information technology. Topping the list was electronic commerce--the creation of a global marketplace to be made especially available to small- and medium-size businesses. A working group on electronic commerce was formed to establish a framework for policy development among the seven nations, and to serve as a platform for even wider cooperation among all nations.

Because of CommerceNet's strong industry representation and its international leadership in developing the basic protocols for Internet-based commerce, the group's founder and chairman, Marty Tenenbaum, was asked to join the working group. Jim Johnson, president of Eikon Strategies, a policy management firm for high-tech companies, was asked to chair the group. David Jefferson, head of the computer labs at the U.S. National Institute of Standards and Technology (NIST), and Shirley Hurwitz, manager of NIST's most advanced work on electronic data interchange (EDI) and database management, represented the U.S. Government.

Public and Private

Early in these international discussions, it was clear that there were controversial central policy issues that needed resolving. The U.S. delegation wanted to push for private industry leadership in developing policies for electronic commerce, because industry was building the basic global system. Our view was that policy-making should follow practical experience in the marketplace. Policy-makers in the U.S. are acting in response to industry initiatives in the market.

The European Union (EU) and its four G7 member states believed that the policy issues were so serious that they required careful development by policy makers in governments, particularly in Brussels, the seat of the EU. They wanted to slow down the process of build-out of the global marketing system until all policy issues had been resolved. Their viewpoint flowed from the greatly centralized policy-making role which the EU has created in developing a unified Europe.

In September 1995, CommerceNet hosted the seven national delegations for an extensive tour of briefings by member companies on what they were offering to the cyber-marketplace; this was a turning point in the negotiations. The guest countries brought along technical experts from some of their own companies. It was clear to them that the U.S. had a major practical technology lead and that U.S. efforts were addressing real problems of electronic commerce, such as security, privacy, cashless payment systems and interoperability.

The evidence of American company leadership shifted the emphasis of the negotiations, and the focus on industry leadership was clarified. At the next G7 meeting in Tokyo, the Japanese opened up access to their own private companies. The U.S. fought to get language into the framework agreement to allow private, commercial, for-profit electronic commerce ventures to operate alongside the EU and other government-sponsored projects as testbeds under the imprimatur of the G7. The Europeans fought inclusion of this private sector focus in the agreement, but delegates from their own industries pushed for inclusion.

Emerging Projects

The criteria for the G7 testbeds include projects that are multinational, with at least three different economies or companies. They can be private-sector or public projects and must agree to address the core issues of operational electronic commerce and to publicize their experiences. The projects can be experimental developments addressing single aspects of electronic commerce--such as cashless payment systems, security of transactions or database management--or as comprehensive as global online "minimarketplaces" joining together customers and sellers across national boundaries. All countries and other international organizations are invited to join the projects; they are not limited to the original seven nations. CommerceNet's ongoing international pilots will be a centerpiece of the U.S. nominations. Moreover, we are eager to help other U.S. organizations initiate projects and coordinate them with the appropriate global partners.

Other nominated projects include the Global Engineering Network, nominated by Germany; the International Business Network, working in cooperation with the International Chambers of Commerce; the United Nations Conference on Trade and Development (UNCTAD), nominated by France, Japan and the U.S.; and the International Business Exchange/Global Business Alliance, nominated by Canada. The process for consideration is open. If a project receives endorsement from its home country delegation, there is no second-guessing by the other countries.

We anticipate that a comprehensive electronic commerce architecture will evolve out of these experiences, encompassing security, payment, directories, collaboration, EDI and other key elements of an electronic marketplace. Because agreeing on technical standards is difficult, emphasis will be placed on "meta-standards": negotiation protocols and application programming interfaces (APIs). Such meta-standards enable buyers and sellers to negotiate which security and payment approaches (and, hence, standards) will be used in any particular transaction.

Public policies will also evolve from these experiences, such as the following. How should tariffs and value-added taxes be apportioned among the various constituencies involved in a transaction? Whose laws and regulations will apply if a dispute arises? Which rules shall govern the export and use of strong cryptography? The G7 is seeking to cooperate with other global entities to resolve these and a host of related policy issues, to build the information society. There is ample opportunity for the industry to make its voice known on policy issues.

Project nominations can be sent to
The e-mail address for more direct information is

Marty Tenenbaum is chairman of CommerceNet in Menlo Park, CA. He can be reached at

Jim Johnson is president of Eikon Strategies in Washington, DC. He can be reached at