Firms adopt the Internet for different purposes, ranging from simple Internet presence to using the Internet to transform business operations. This paper examines the contingency factors that affect levels of Internet adoption and their impact on competitive advantage. A questionnaire was used to gather data for this study; 159 usable responses were obtained from a sample of 566 firms in Singapore. Results indicate that most firms are still exploring the business use of the Internet. A proactive business technology strategy was found to be positively associated with the level of Internet adoption. Technology compatibility and top management support were found to have no significant relationships with the level of Internet adoption. Further, the level of Internet adoption had a significant positive relationship with competitive advantage. These results provide a better understanding of the contingency factors affecting the level of Internet adoption, as well as providing some evidence of the positive impact of Internet adoption on competitive advantage.
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