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Since small-medium sized enterprises (SMEs) play a vital role within many major economies throughout the world, their ability to successfully adopt and utilize the Internet and electronic commerce is of prime importance in ensuring their stability and future survival. This paper highlights some of the important issues identified by SME managers relating to the adoption of Internet related technology that government policy makers will have to address if their initiatives aimed at increasing adoption among SMEs are to succeed. Initial findings will be reported of a study carried out by the authors into the use made of the Internet and electronic commerce and key issues influencing its use by SMEs among a sample of 484 businesses within West Central Scotland. The study has drawn upon a number of data collection techniques such as questionnaires sent to 2,500 small businesses, in-depth face-to-face interviews and telephone interviews. With a base response rate of 20% the data reveals interesting details relating to actual connectivity levels, attitudes with regard to how small businesses perceive the Internet and electronic commerce, as well as the impact of government policy on Internet connectivity and adoption. The results gained from the study will be compared with figures relating to businesses in the rest of Scotland and the UK, as well as the US, Canada and Japan, and European countries that include Sweden, Germany, France and Italy. The issues raised from this study will be compared with similar studies carried out in other countries such as Australia, New Zealand and British Columbia, as well as countries within the European Union in order to provide a wider international context for the results of the study. [ABSTRACT FROM AUTHOR]