Gas sure is pretty expensive nowadays. I am glad to be a frequent subway user in Montreal these days. The recent numbers shown by the US bureau of economic analysis portr
ait a pretty grim picture of the current US inflation, mainly caused by the rising crude oil prices. As we all know, this reflects in well…pretty much everything we buy.
Fortunately, we have Internet! With the Internet, there’s no need to be worried about oil prices as we can travel all over the world without ever having to leave our seats. Technically this is true, as long as we ‘trade’ digital goods, such as images, music, HTML documents and such (long tail products again!).
The reality is we still need to be housed, to eat, to drink and to import our favourite Japanese Manga series via eBay (well, maybe not everybody, but you get the idea). Chances are they will be imported by plane or some by boat. Guess what? These means of transportation also happen to consume a heavy quantity of oil too! In other words, in the long run everything will cost more, even if you bought it over the Internet.
According to Business Week (June 30th issue), it costed 15$ to ship a ton of iron from Brazil to Japan in 2003. Last fall, shipping costs rose to more than 90$ for the same distance. What kind of impact will this have on e-commerce? Can we expect a drop in exchanges over the net? I think it may be inevitable; people are most likely to be more careful about shipping costs, especially on places like eBay, where shipping can make the difference between a great or a really bad deal.
M-A L.