Christine Siegfried
E-Government and E-Commerce - German Experience
in the Construction of Virtual Town Halls and Market Places
Paper delivered at the International Symposium "Developing an Electronic Commerce Infrastructure: What Should be the Role of Governmental and Private Organizations?", Beijing, Tsinghua University, School of Economics & Management, 19-21 September 2001
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Contents: |
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| Introduction | ||
| The MEDIA@Komm initiative | ||
| The prizewinning municipalities: Bremen, Nürnberg municipal association, Esslingen | ||
| Current issues | ||
| Conclusion | ||
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This essay deals with the experience of German municipalities in the construction of virtual town halls and market places by reference to the example of MEDIA@Komm. It aims to show the efforts which are being made in Germany to promote e-commerce and e-government and the experience that has been gained and is still being gained in the process. To this end, first of all the framework of the project MEDIA@Komm will be outlined and the municipalities of Bremen, Esslingen and the Nürnberg municipal association will be presented with their concepts and first results. Finally, current issues and obstacles will be described which have become apparent during the project and which are closely linked with the spread of e-commerce and e-government. Since the mid-1980s the Business and finance department of the German Institute of Urban Affairs has dealt with the question of the effects of new information and communication technology and new media on towns and cities. For some time now, the subject of e-government has increasingly been at the centre of interest. We are therefore also trying to offer the local communities guidance and assistance in this area. Not least because of its extensive experience in this area, the Institute
was commissioned by the Federal Ministry of the Economy (BMWi) to act
as the consortium leader and provide academic support and guidance to
the federal government's largest multimedia initiative. Together with
three other academic institutions, each of which deals with specific
aspects of the subject, Difu deals with economic issues and questions
of administrative science. In addition, specialist events are held and
a cooperation and communication network is being established which also
includes the Internet presentation on MEDIA@Komm. PC and Internet are not only increasingly used in the population, technological information processing is now also an established element in the administrations of the national government, the federal states and local communities. The infrastructure in German towns and cities has improved considerably over the last three years. Almost 90 per cent of the administrative staff now have a PC, and almost half have internet access and can be contacted by e-mail. With the increasing use of technical equipment in the administration and the continuous increase in the use of PCs and the Internet by the citizens, a change is also taking place in the self-presentation and self-image of towns and cities. Almost every German municipality can now be found on the Internet under "www.placename.de". Most of them, especially the smaller towns, offer information about their history or the local sights and provide details of their opening hours. With increasing experience in handling the new technology, and with the aim of improving the service quality for the citizens, towns and cities then extend their Internet presence. "Progressive" towns and cities offer their citizens the opportunity to communicate electronically in addition to the provision of information. In recent years, work is increasingly being done to enable transactions to be carried out on-line, so that citizens can carry out their "visits" to public authorities from home. In many municipalities, so-called virtual market places are arising which aim to provide the citizen with attractive on-line shopping facilities. On-line services of the administration are already offered in many forms by many towns and cities. Recently, a number of municipalities have been trying to combine their administrative services and the e-commerce facilities in a single system. From an early stage, the discussion in Germany centred around the question of how such transactions could be made absolutely secure legally and how they could be seamlessly integrated across different media. The Digital Signature Act, which was passed in 1997 the Federal Republic, took this subject into account. It provides a basis for the use of chip card-based electronic signatures. MEDIA@Komm offers the framework for the initial use of signatures in practice and the compilation of legally secure on-line-transactions. Over 100 transactions are being moved to the digital network, and more than 30 have already been implemented. Residential registration, change of address, planning approval applications and information from the registers will be seamlessly integrated across different media by electronic signature. And this includes electronic payment with chip cards in the same process. MEDIA@Komm has a pioneering role in the use of digital signatures as
a precondition for the introduction of secure and convenient on-line
services. The emphasis in Germany is on the chip card solution, which
is especially secure. Accredited and certified trust centres which comply
with high security standards have been established for the issue and
implementation of electronic signatures. 
The MEDIA@Komm initiative The implementation of the MEDIA@Komm model projects goes back to a
municipal competition declared in 1998. 136 towns, cities and local
communities took part with their concepts. In 1999 the jury determined
the three prizewinners: the Hanseatic city of Bremen, Esslingen and
the Nürnberg municipal association. A fourth town - Rathenow in
Brandenburg - was awarded a special prize for the implementation of
an individual project, electronic access to records. But not only the prizewinning municipalities are working on the implementation of their concepts. Even towns and cities which were not among the winners of the competition are continuing to develop their virtual town halls. A survey carried out by Difu among German towns and cities in 2000 showed that almost 10 per cent already "had their plans in the drawer". Almost 18 per said that they would soon "lay the foundation stone", and 43 per cent are "already working on the foundations". 16 per cent claimed that the "lower floors are already built", and 6 per cent aim to celebrate their "topping out ceremony" soon. As an example of the experience of e-government and e-commerce in Germany,
the concepts and results of the prizewinning municipalities of Bremen,
Nürnberg and Esslingen will now be presented. The implementation
of the projects started at the beginning of 2000, and they should be
completely implemented by the end of 2002. A total of over 120 mill.
DM are being invested in the projects, including 50 mill. DM in subsidies
from the Federal Ministry of the Economy and Technology (BMWi).
 Progress to date Access - how to get e-government to the citizens Many measures were adopted in the Bremen project to facilitate access to the card and the applications. A total of 1000 signature cards have been issued since the project began. As in the other MEDIA@Komm municipalities, it is assumed that the banks in Germany will in future issue combined cards for payments (EC card) and digital signatures, so that in a few years most citizens will have chip cards which can also be used for electronic signatures. The signature cards can be obtained at various points in the city such as the municipal library and the Sparkasse bank. The necessary scanner can also be obtained for a modest charge - in addition to signatures, this scanner can also be used for purse card payment via the Internet. To help users to familiarise themselves with the signature card, the scanner and the services offered by the bremer-online service under professional guidance, supervised user sites have been set up. A completely equipped computer can be used free of charge, and supervisors are available to answer questions. There is a free telephone hotline for technical questions and further information on the project. Platform and products OSCAR (On-line Service Computer Interface Architecture) is the latest development in the Bremen project. This name stands for a system architecture for secure and legally binding applications in the area of public administration. For the first time, a platform has thus successfully been developed for e-government on which it is possible to carry out on-line transactions irrespective of the technology used and the manufacturer. It enables forms to be provided, filled in and electronically signed on-line, then sent back to the public authority by secure data transmission. Applications, applications, applications Since May 2001, applications for students have also been in place. Changes of address, registration of semesters on leave and exmatriculation can be carried out on-line with the signature card by students at the University of Bremen and the higher education college in Bremen and Bremerhaven. In the course of the year, other applications will also be offered to students of these higher education institutions. A service for solicitors and businesses is currently in the test phase.
They can call up information in electronic form free of charge from
the register of companies database at the Local Court (Amtsgericht).
A further process, which is also likely to interest small and medium-sized
companies, is the on-line debt collection application, which is being
developed for the Free Hanseatic City of Bremen by bos GmbH in cooperation
with a Düsseldorf software company. With this software, applicants
will be able to file debt collection applications electronically via
the Internet, thus saving time, effort and costs. And finally, the prototype
of a digital tender platform for the award of public orders in the construction
industry is currently being developed in Bremen. The process is being
developed in cooperation with the private company Conject AG and will
make it possible in future to read announcements and download tender
documents over the Internet. On the basis of past experience and the difficulties in transferring pilot projects to the individual municipalities, it was decided to develop a series of software modules (e.g. for signature, payment etc) which can then be used for the implementation of the respective individual on-line services. In Nürnberg, as in Bremen, there are three pillars of the project,
but they are "sorted" differently.
 Progress to date Cross-section projects Curiavant Internet GmbH has developed a platform which has already been used as the basis for the communal application "Resident's parking permit" in Nürnberg, Erlangen and Fürth (Nürnberg October 2000, Erlangen and Fürth 2001). To offer additional communal services, a business partner with a similar technological orientation was sought and found. In future, both companies will work jointly on the modular on-line platform to provide the other planned communal and private commercial applications. In Nürnberg, too, the ability to enable electronic signature and payment is mandatory. Like in Bremen and Esslingen, it is hoped that the chip cards can be used for multi-functional purposes as far as possible. Thus, there is now a proprietary "flip chip card" developed by Curiavant (with chips on both sides) which can be used for electronic signature and payment. On one side it contains a purse card from the Sparkasse which is not linked to a bank account, and on the other side it contains the digital signature from the Deutsche Post subsidiary Signtrust. Other payment modes are currently being designed for use in on-line services and implemented in the communal sub-projects. An important aspect is the integration of the payment process into the internal work flow of the local authorities. In the next task building blocks, modules such as authentication, verification,
entitlement checking, encryption, key management in the administration,
archiving etc. will be implemented in practice. Of the total of 19 different local community sub-projects, 12 have
already begun in Nürnberg. A further 7 sub-projects will start
shortly (trade registration, information from the trade register, vanity
vehicle registration numbers, TÜV (Technical Control Board) registration,
invitations for tender/award of contracts, dustbin orders, citizen participation).
The overview shows which projects are now being successfully transferred
to other local communities. To ensure alternative access to the communal on-line information service
for all groups of the population, a prototype is being developed for
TV access via a set-top Internet box in collaboration with a local major
manufacturer of home electronic entertainment appliances. The solutions
will be presented at the end of the summer. Esslingen With 80,000 inhabitants, Esslingen is the smallest of the municipalities
in MEDIA@Komm and therefore has the ambition to develop solutions specifically
for medium-sized towns. By contrast with Bremen and Nürnberg, the
computer infrastructure for the virtual town hall is still largely not
available in Esslingen and Ostfildern. And the town information system
www.esslingen.de is only now being designed. This provides an opportunity
to develop a homogeneous and integrated solution without the need to
make allowances for any existing structures. At the same time, information
facilities must be developed to a far greater extent than in the other
MEDIA@Komm municipalities to enable the "triangle" of information,
communication and transactions in the Internet to be created.
Progress to date To achieve goals such as greater transparency of the administration, customer orientation, better accessibility for the citizen and faster handling of administrative procedures, the Esslingen citizen information service ESSOS ("Esslingen On-line Service") was founded. In addition to a catalogue of information, concerns from the areas of foreign residents, vehicles, trade and industry, children, social benefits and changes of address will be offered on-line under the heading of life situations. Applications which are currently in the pilot project stage include resident's parking permit applications, the trade register (registration, change of details, deletion), information from the trade register, dog registration and deletion, dog tax and fault reports. The virtual lost property office is also already available on-line. Many other Internet services are planned. Since the summer of 2001, some citizen services have also been available for mobile phones via WAP. For example, a mobile phone car park guidance system is heavily oriented towards the users. This service can be accessed from anywhere at any time, and it provides information on the available space in the indoor car parks in Esslingen. In accordance with the principle of the local community of citizens, projects have now been implemented or are shortly to be implemented which provide information for the citizens and involve them in the process of discussion on developments in the town. Thus, citizen forums have been set up on the Internet which enable interested persons to discuss topics relevant to Esslingen. The zoning plan provides an even more practical example. The formal participation of the citizens in the development of a new construction area in Esslingen was also implemented via the Internet. For construction projects an on-line planning approval procedure is also offered as a new service in which all information (plans, illustrations, correspondence) is available via an Internet platform - after the user has identified himself with his digital signature. This can be used on-line by the administration, the citizens, contractors and architects. To counteract the "digital divide", projects such as the supervised citizen PC (Bürger-PCTM) were implemented, which particularly aims to help population groups in Esslingen with little experience of new media to make use of the Internet and digital signatures. At central points in the town (e.g. in schools), PCs are available for the use of the public. They are equipped with standard software and have Internet access and signature card scanners. To ensure data security and confidentiality, each user is assigned his own profile which is created once in the location and then given to the user on a disk. The PC is configured so that whenever the system is rebooted, every user is presented with the original status from his disk, and the PC itself contains no traces of the data of the previous user. Great attention was attracted by the world's first legally binding
on-line election of a public body - the Municipal Youth Council in Esslingen
- which was (partly) carried out via the Internet with the aid of digital
signatures (from 9.7. to 12.7.2001). The on-line election fulfills all
legal requirements; the municipal regulations had to be adapted for
this purpose. Current
issuesIn the implementation of the individual projects in the towns and cities, it soon became apparent that many questions are still unsolved, that progress depends on technical and economic factors in many cases and that the legal and regulative framework is largely not yet in place to enable the goal of legally binding on-line transactions which are seamlessly integrated across different media. Some important factors which are still being discussed in the complex area of implementing e-government and e-commerce will now be enlarged on. Diffusion of electronic signatures User friendliness and user benefit Creating a technical platform to handle on-line transactions Re-engineering processes in the administration Statutory framework
If e-government for the citizens cannot yet be taken for granted, it is worth looking at e-commerce and asking whether the experience gained there gives any indication of whether secure transactions can become established at all. In e-commerce we must distinguish between two different business relationships: business-to-consumer and business-to-business. In the business-to-consumer sector, on-line transactions are very often handled even without an absolute demand for security, based only on trust. To use on-line shopping services via the Internet, all that is needed is trust that the provider that will deliver the goods in a reasonable condition, and a credit card to pay with. Although there is a trend here, too, towards secure transmission and secure payment, there is still a considerable difference between on-line shopping and on-line public administration transactions in relation to the necessary requirements and the effort required to satisfy them. This is different in the business-to-business sector. On the platforms on which business companies handle their business dealings, the confidentially of Internet communication and secure authenticity verification are more or less essential, so software certificates and chip cards are widely used. Until we know how the two areas considered here - e-government and e-commerce - will develop in terms of acceptance, use and turnover, it will also be difficult to assess whether the German approach of aiming for the maximum degree of security by using chip cards will become established. But the MEDIA@Komm towns and cities are subsidised by the national government for this very reason. The aim is for them to show where the problems lie, what requirements need to be fulfilled and what detailed solutions are, in fact, possible. In closing, I will now look at the link between e-government and e-commerce. Many German towns and cities are working on solutions for a virtual town hall and gathering experience in the creation of virtual market places. In the Federal Republic of Germany - and in the whole world - there is currently a discussion on so-called portals which can provide access to both the administration and private service providers. The life situation concept which is being implemented in Bremen is based on the idea that, from the user's point of view, a variety of information and transaction facilities (both private and public) need to be combined, and that this is the only way to create benefits for all. This supports the idea of merging administrative services and private services on a single platform, in other words treating virtual town halls and virtual market places as a single entity. It is not yet clear what criteria can be applied to decide whether a portal which combines both areas can be regarded as economically viable. Towns and cities are not always able or willing to integrate private service providers into their municipal portals. Nor are they eager to integrate their services into the portals of private enterprises without any service in return. Experiments are currently in progress to determine what forms of public-private partnerships could be successful for both sides. The debate about portals also clearly shows that the implementation
of virtual town halls does not only involve questions of e-government
- although even this presents a major challenge to the administrations
because of the necessary internal reorganisation. In fact, virtual town
halls have an effect on the entire economic situation of the towns and
cities, and it is also necessary to integrate private service providers,
citizens and institutions into the social and cultural sectors. The
public discussion in the towns and cities is only just beginning to
move in this direction. Much research is therefore still needed to obtain
a clear picture of the interdependence and the factors for success in
the relationship between e-commerce and e-government. |
