While business-to-business electronic commerce accounted for just four percent of all B2B spending in 2001, online activity will rise steadily over the next five years and comprise 36 percent of all spending by 2006, reports Jupiter Media Metrix Inc., a New York-based research firm.

E-commerce will account for seven percent of B2B spending in 2002, 12 percent in 2003, 20 percent in 2004 and 29 percent in 2005, Jupiter projects. Online spending is expected to total $793 billion this year, with a projected increase to $5.4 trillion in 2006.

Among the industries that will move the largest share of commerce online is computer and telcom equipment. The sector, which had eight percent of its B2B trading occurring online last year, will increase its penetration to 15 percent in 2002, 30 percent in 2003, 41 percent in 2004, 52 percent in 2005 and 60 percent in 2006, Jupiter projects.

Other industries making major moves to B2B e-commerce are aerospace and defense, which will conduct 54 percent of its trading online by 2006, up from 11 percent in 2001; motor vehicles and parts, with online penetration jumping from 10 percent last year to 50 percent in 2006; metals and mining, going from six percent in 2001 to 43 percent in 2006; and chemicals, increasing from seven percent in 2001 to 39 percent in 2006.

"While industries with consolidated supply chains should see fairly even growth throughout the period, industries that are more fragmented, such as chemicals and computer/telecom equipment, will see more gradual growth," Jupiter says. "Once a critical mass of B2B infrastructure is installed in the more fragmented segments of those supply chains, offline laggards will adopt B2B commerce to stay competitive."

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