A new e-commerce operation, to be located in Dublin, marks the first commitment by a US company to manage all of its Internet services from Ireland.

Viking Office Products is expected to create 25 jobs in the Republic over the next three years, following the establishment of its Viking Internet Ireland site at Ballymount, Co Dublin.

The move, supported by IDA Ireland, will pioneer the State's efforts to establish Ireland as a leading centre for e-commerce in Europe. It is targeting direct marketing, business-to-consumer and e-commerce service providers.

A spokesman for the IDA said this was the culmination of an aggressive marketing drive in the US, which has run since January. "In the same way we targeted the tele-services, and then the shared services markets, IDA Ireland's policy for 1999 is to pilot Ireland in the e-commerce market. The policy for Government will be to get the telecommunications infrastructure in place," the spokesman said.

Announcing the investment yesterday, the Tanaiste, Ms Harney, said: "While a number of existing companies have significant e-commerce sales, Viking is the first greenfield overseas e-commerce project to locate here. It will be a valuable reference site for IDA Ireland in its continued marketing of Ireland as a location for e-commerce."

Viking Internet Ireland will be located next to the company's existing Irish operation, Viking Direct, which currently employs 65 people servicing the Irish market.

IBM has announced a five-year $3 billion technology and business alliance with rival EMC the computer data storage systems maker. The move significantly expands the existing relationship between the two companies. Under the deal, EMCwill increase purchases of IBM disk drives and share key technologies. In the future, it has agreed to buy IBM microprocessors and advanced custom chips.