Online purchases in Canada totaled about $8.5 million Canadian dollars in 2004. Most of these items included books and reservations for travel and lodging. Only thirty-six percent of Canadian businesses have a website presence. The adoption for small, medium, and large businesses is slowly increasing at a rate of two to three percentage points. The rapid advances in technology have resulted in consumer confidence in private data protection, increasing the online sales.

E-commerce is a way of doing consumer-oriented business transactions over the Internet. This is actually retailing in the Internet format. Just as in a supermarket, online consumers choose products by navigating the site along the categories of products and make payments online using credit cards. The products are then delivered within a certain period.

Web hosting is one of the links in the e-commerce process. The chain is formed by different links such as websites, shopping processes, credit card processing, and merchant accounts. Websites are hosted by an external provider or perhaps the business itself. The shopping process is actually a shopping cart that allows the selection of products just like placing the products in a supermarket cart. When the customer finalizes the buying process by filling in the credit card form, the credit card is processed to check the validity of the card. The processed information is sent to a merchant, who credits to the account of the business.

The value of web hosting lies in providing the seamless transfer of the process between various links. The web host could also add value by designing the site for the shopping cart and processing the credit card. It could also provide value-added information about the e-commerce process to the clients in order to make the process clear.

The value addition in the chain puts web hosting services at $200 and more. Many web hosting providers have combined with credit card processors to add value. Some of the main issues in deciding on an e-commerce host are bandwidth, security, back-end integration, reliability, and server set up.