Electronic Data Interchange (EDI) is seen as a technology with great potential to improve competitiveness. However, its diffusion has been slower than predicted, particularly in Small and Medium Enterprises (SMEs). This study will address the strategic, structural, and technical barriers to EDI diffusion. A special attention will be paid to the 'competence shortage' of users that can limit EDI adoption. The role of telematic services providers in overcoming the obstacles to EDI diffusion will be also analysed. Due to the differences between Italy and the UK regarding the EDI diffusion patterns as well as the structure of the service sector, an international comparison is expected to provide lessons both for policy and for firm's strategy as to the further diffusion of EDI. An extensive case-study on various EDI projects, on one hand, and on the structure and strategy of the telematic service providers, on the other, will be conducted.