Ernst And Young Information Security Survey Casts Shadow Over Channel Islands' E-Commerce Ambitions

by Robert Lee, Tax-news.com, London

19 April 2001

During March 2001, Ernst and Young in the Channel Islands asked 215 organisations in Jersey and Guernsey to complete a written questionnaire relating to information security in the electronic economy. The findings of the survey, entitled Channel Islands Information Security Survey 2001, have just been published and reveal that security and privacy concerns are the biggest inhibitor to the expansion of e-commerce in the islands, closely followed by the lack of facilities. The findings of the survey must surely come as a disappointment to the Jersey and Guernsey governments and e-commerce authorities, who have long been pushing their respective islands as premier locations for e-business.

Over half the organisations asked to participate in the survey responded, including representatives from the banking, fund management, insurance, telecommunications, retail and trust company sectors. The aim of the survey was to understand how businesses in Jersey and Guernsey view IT risk and security.

Many of the organisations surveyed do not have an e-business strategy, although do use the Internet. Whilst 22% of those surveyed are currently using electronic transaction capabilities, a further 38% say they are considering using them, so security issues are becoming an increasingly important concern for companies in the Channel Islands. Indeed 77% of the respondents to the survey cited security and privacy concerns as the major stumbling block, due to lack of employee awareness, lack of confidence in detecting hacking attacks, or previous experience of business systems failures.

However, a hefty 37% of the respondents said that they considered the lack of resouces, skills and expertise within the Channel Islands as the second major barrier, the three principle areas identified as needing improvement being the cost of telecoms services, broadband services and infrastructure, particularly links to the UK and Europe.

Other concerns identified by the survey were lack of confidence in business partners or third parties and lack of confidence in IT infrastructure to support it. Many of the Channel Islands' e-commerce enterprises outsource a variety of IT functions - the main ones being ISP web-hosting and IT infrastructure - for reasons of expertise, cost efficiency and maximum service levels. However, a number of respondents indicated that they were unhappy with at least one key area of their outsourcing deal.

Referring to the case of Jersey, Ernst and Young managing partner Andrew Dann was quoted in the local press as saying: 'If we do not grasp the opportunity and address these issues there is a very real possibility that Jersey will miss the e-business boat. We have got the new Draft Telecommunications Law coming in and things are changing very fast but there is much work to be done.'

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