`Commerce is: going into a hardware store, perusing the hammers and then handing over some cash while a sales assistant rings up the sale, makes change and puts the hammer in a bag.

E-commerce, in this example, would be connecting a computer to a relevant Internet site, perusing screens of hammer-related data, selecting a hammer, and filling out a form indicating where it should be sent and which debit or credit card will be used to pay for it. Later, the hammer will be wrapped and mailed to the customer from the seller's warehouse.' Bermuda's role in e-commerce will be that of service provider to the industry, initially as a facilitator and then as an incubator for ideas.

Such was, more or less, the consensus view at the Chamber of Commerce's conference on e-commerce last week.

The nearest metaphor is the part that Bermuda plays in the lives of the insurance and reinsurance industry and the financial services sector.

Since Bermuda is an advanced country from a technological standpoint, with computer ownership and literacy high, all aspects of Bermudian life will be affected by e-commerce.

The chief beneficiaries of e-commerce, the view is, will likely be the existing service providers -- the bankers, lawyers, accountants and managers -- plus technical professionals such as the Internet service providers, e-commerce gateway providers and even the construction industry, which may have to retrofit a good percentage of Bermuda's older office building stock.

The banks will gain from the new business, not only in the traditional manner, but as technicians themselves, facilitating the payment streams that will flow to e-businesses based in Bermuda.

In fact, any business which values speed, efficiency and low cost operations will benefit as e-commerce takes greater hold.

What exactly is e-commerce? In a nutshell, it is business conducted electronically. Commerce is a term covering a variety of transactions, and e-commerce is essentially the same thing, with some or all stages of transactions conducted electronically.

The elements of a transaction are exactly the same in e-commerce as they are in regular commerce. Both require a buyer and a seller, a selection process, offer and acceptance, and payment and delivery.

Take, for example, a Bermudian who wants to buy a hammer.

Commerce is: going into a hardware store, perusing the hammers and then handing over some cash while a sales assistant rings up the sale, makes change and puts the hammer in a bag.

E-commerce, in this example, would be connecting a computer to a relevant Internet site, perusing screens of hammer-related data, selecting a hammer, and filling out a form indicating where it should be sent and which debit or credit card will be used to pay for it. Later, the hammer will be wrapped and mailed to the customer from the seller's warehouse.

Since the hammer in this example was purchased with a bank card, the customer's payment would be processed electronically. The only human beings directly involved in the transaction would be the customer and the supplier's shipping clerk.

That branch of e-commerce is one arm of what is referred to as "business to consumer''.

The example of a Bermudian buying a hammer was, in some ways, a deliberately poor one. For a year or two yet, it will be cheaper and quicker to pop down to a local hardware store and buy a hammer, because mailing it to Bermuda from the seller's warehouse would be very expensive.

Even today, though, the hammer transaction is not entirely outside the realms of e-commerce. It might have been, indeed probably was, bought by the store as part of a bulk consignment of hammers, using e-commerce. Many Bermuda retailers already place their orders to their suppliers on the net and receive their bills that way, too.

The larger Bermuda hardware stores pay their suppliers electronically too, instructing their bank by an electronic letter, suitably encoded, to send money electronically to the supplier's bank overseas.

That branch of e-commerce is an arm of what is known as "business to business''.

Tomorrow: Opportunities for Bermuda.

BUSINESS BUC