The Internet is causing fundamental changes in the economics of service industries as new, network‐based global e‐business models emerge, where small‐ and medium‐sized enterprises (SMEs) have been identified as key users of Internet commerce. Initially the paper contextualises the research issues via a review of the theoretical opportunities afforded firms of all sizes. Correspondingly, an examination of the practical impediments from an SME perspective suggests that, among other things, there are major hurdles for SMEs going online including strategic appreciation of the dynamics of the Web and the development of capabilities for managing the information infrastructure for e‐business. To illustrate the inherent issues, the findings of empirical research are presented. Both inductive and deductive methodological approaches were employed to investigate e‐business awareness, attitudes and activities among a sample of Irish (north and south) service sector SMEs.
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