As companies devise their slowdown plans, it will be interesting to see how often e-business is pinpointed for cuts. I suspect that most boards will decide to leave it alone - often more through faith than conviction.

For many, the Internet has not delivered. An inordinate amount of time has gone into developing online strategies, the results of which have often been ineffectual websites or half-hearted initiatives.

Now is the time to ask hard questions - to see what you have achieved so far and how you can use the Internet more effectively.

A report by Net Profit* points out that the Internet can cushion a slowdown in demand. Companies that benefit will be those that understand the subtleties of the new medium and get their timing right.

Here are some of Net Profit's predictions:

"Channel conflict" will intensify as manufacturers and other end suppliers (of, for example, financial services) bypass traditional distributors. In every case there are sweet words about how distributors will be involved and often they are given a role. But as competition warms up, some suppliers will judge it worth sacrificing the goodwill of existing channels to sharpen their competitiveness.

After a lot of hype and little real activity last year, Internet-based procurement will take off. This is partly because the potential savings from electronic purchasing are so big that it will be an easy sell to directors seeking cuts and partly because the "Net markets" industry will have rationalised and clear leaders will have emerged. One company's purchase is another's sale. So business-tobusiness trade will boom: good news for low-cost suppliers in eastern Europe. [SBX] The slowdown will leave more products unsold. The Internet has a plethora of devices, led by online auctions, for selling these in a price-disguising way. Expect them to flourish, at least in the short run.

As larger payments and more critical information fly around the Internet, there will be renewed concentration on security. Digital certificates and smart cards may finally take centre stage. In combination with "trusted third parties", they provide a way of checking that your product, or your money, does not go to the wrong guy.

Other efforts to take cost out of the supply chain will accelerate. For example, the whole international trade payments infrastructure, unchanged for centuries, is being dragged into the present day. The first stage is to "electronify" existing processes through initiatives such as Bolero.net. Eventually we will see letters of credit replaced by digital certificates.

Online advertising will be weak. Rates will fall and advertisers will retreat to safer ground.

Pay-per-view, the other revenue route for publishers, will benefit from developments in smart-card and electronic payment technologies. A shake-out in business information providers will make it easier for the survivors to charge for material.

Application service providers, which allow companies to save money by renting software via the Internet, should flourish in a slowdown. But their users will get real benefit only if they have high-speed online access.

Companies that have been using the Internet as an extra selling or customer service channel will have to turn it from a cost-increasing to a cost-saving device.

Companies will use their imagination to replace high-cost channels with the low-cost Internet. Do companies really want to spend a fortune on thick, glossy annual reports? Regulations demand limited printed information sent to shareholders. The rest, surely, should go online.

*Cushioning the slowdown: an e-business guide. Free from Net Profit Publications, www.net profit europe.com. David Bowen is editor-in-chief of Net Profit.