The company, based in New Hampshire, USA, will initially employ seven people, which is expected to be quadrupled within a year, undertaking sales, marketing and customer service.

It is Silknet's first European venture and will become the spearhead for further moves into Germany, The Netherlands and France.

The company develops and markets a range of specialist Internet-based "software" and products for telecom companies to deal with their customers through the Internet as an alternative or in addition to telephone-based systems.

The Yorkshire & Humberside Development Agency (YHDA), together with the Government's Invest In Britain Bureau, worked closely with Silknet and played an important role in attracting it to the region.

Experts agree that the Internet is on the verge of revolutionising many business activities currently handled over the telephone and will see phenomenal growth.

Silknet's products "are leaders in their field," being designed to allow easy "self-service" access to and use of traders' facilities via the Internet for inquiries, purchases and service requests.

The technology employed allows companies to increase their trading opportunities and reduce costs compared to existing ways of doing business.

Silknet chose the region for its British base because it offered the right combination of facilities and skills to meet the company's demanding requirements. This included ready availability of advanced telecommunications facilities, quality office accommodation and highly-trained graduates with specialist skills.

The company, established in 1995, was also very impressed by the nature and quality of research and development in computing science in the region's universities, especially York. Silknet considers there is scope for future joint projects and development work.

Terry Wilcox, Silknet's managing director, said: "We are delighted to open our first European office in Harrogate, and expect to grow as quickly as our parent company did in America."

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