Without adequate broadband infrastructure, Australia will continue to lag behind the rest of the world when it comes to creating business online.
Incredibly, only nine percent of Australian small-to-medium enterprises (SMEs) are open for business over the Internet, according to the Australian Internet Industry Association (AIIA).
The association's CEO, Sheryle Moon, said most of these small businesses have a static Web presence which is essentially online brochureware.
"Very few are actively engaging in e-commerce," Moon said.
"Broadband is the key to Australia's long-term productivity and economic growth, and it isn't just a communications issue but an industry issue.
"It will provide the key to Australia's long-term productivity and economic growth."
Moon made the comments earlier today when she welcomed the federal government's $1.9 billion Australia Connected inintiative.
She said Australia now has two viable broadband proposals.
"Without adequate broadband infrastructure, we will not attract investment from global companies, nor have the infrastructure for small Australian companies to grow and run reliable global businesses from regional locations," Moon said.
"To boost online activities, business needs to be able to access fast, powerful broadband to meet customers' needs and business goals."
Moon pointed to a recent Economist Intelligence Unit (EIU) report which ranks the developed world's e-readiness.
Australia was in ninth position, down from eighth in 2006.
"Australia cannot afford to be complacent. While our nation's score of 8.39 is well above the global average of 6.24, there is room for improvement, particularly in areas of connectivity and infrastructure - where we trail behind countries such as Switzerland, Sweden, Denmark and the UK," Moon said.
"Accelerating the adoption and effective use of broadband across Australia will improve our international competitiveness, deliver significant increases in gross domestic product, expand employment and revolutionise the way services are delivered across the economy, in areas as diverse as health, education, research, small business, government and media.
"Broadband is essential for the ICT industry to continue to play its central role as the engine room of our nation's productivity."
Unlike Australia where there has been no significant jump in e-commerce activity, other parts of the world are experiencing a boom similar to the heightened online shopping activity that occurred in late 2003.
In the United States online retail sales will grow 16 percent this year and is set to top $US171 billion, according to Jupiter Research.
Over in the United Kingdom online retail sales have topped $US197 billion with a 55 percent increase in the last 12 months, according to a April 2007 report from the Interactive Media in Retail Group.