Professional Documents
Culture Documents
Class 4
Class 4
Introduction, Framework,
and Models
Learning Objectives
• The handheld device user, connected to wireless network, can also meet
the information access and transactions need round the clock from any
place, even while on the move. The mobile commerce extends the
Anytime Access paradigm offered by the electronic commerce to that of
Anytime and from Anywhere Access.
Benefits of Mobile Commerce
• Due to knowledge of physical location of the mobile service
users, he/she can receive customized alerts, pointing them
to the stores, friends, and restaurant in the vicinity of the
user. A mobile user trying to locate a ATM teller can contact
the banking service provider which in turn can download the
location of the nearby ATM center.
• The timely information such as flight availability, flight
schedule, can be obtained at the last minute as well.
• The last minute on-the-move access offered by the mobile
commerce extends the electronic markets further as the last
minute availability information often leads to immediate
purchase.
Benefits of Mobile Commerce
• It can deliver time critical, emergency information using
SMS based notification and alert services.
• Improved personalization of the content as mobile user can
receive customized information based on current interest
profiles and location of the user. For example, the
advertisers can deliver the discount coupons that can be
cashed in and around the location of the mobile user on the
wireless handheld device.
• If user request the information regarding certain products,
the advertiser can deliver the wireless coupons of stores that
stock the targeted products. Advertisers can deliver time
sensitive, geographical region specific information along with
the promotional discount coupon any time anywhere.
Benefits of Mobile Commerce
• The electronic commerce payment models require the third
party mechanism such as credit cards. The mobile
commerce on the other can utilize the mobile device itself
for the payment purposes, the payments made on the
device can appear as part of phone bills.
• The users can thus pay for parking meters, taxis, petrol etc.
through the mobile device. The Pepsi and Coke has already
experimented in Japan by letting people charge the cost of
drinks to the phone bills.
Impediments in Mobile Commerce
• Mobile Device
• The handheld devices commonly used today include phones, palm-sized
computers. The very nature and purpose of these devices offers a limited
screen size. Although, the handheld devices provide a great deal of flexibility
and mobility in accessing the information but they have far lesser convenient
user interface when compared to personal computers.
• Additionally the mobile devices also have limited computing power. Memory
and storage capacity, as a result they are unable to run and support complex
applications.
• Incompatible Networks
• The cellular networks evolution in past decade has created multiple
competing protocol standards.
• United States- Time TDMA and CDMA
• Europe, Asia Pacific region- GSM
• India – GSM, CDMA (Reliance) for the wireless networks.
• Heterogeneity of the network protocols requires protocol aware application.
Impediments in Mobile Commerce
• Bandwidth Access
• The wireless networks use the frequency spectrum for exchanging the
information. In order to promote a healthy competition amongst the wireless
operators and judicious use of limited spectrum the regulatory bodies control the
spectrum. In India, the frequency spectrums were initially allocated by the
Department of Telecommunication (DoT) and are regulated.
• Security Concerns
• The mobile commerce operates over wireless network making it more vulnerable
to intruders. Intruder can be anyone with ability to receive the signal on their
wireless intrusion devices.
• Limited computing power, memory and storage capacity, it is difficult to deploy
256-bit and higher key encryption schemes
• The atmospheric interference and fading of the signal in wireless channel causes
frequent data errors and sometimes disconnection. A disconnection in middle of
a financial transaction can leave user unsure and distrustful.
• The frequent handoffs as the user moves from cell to cell also add to vulnerability.
Impediments in Mobile Commerce
• Security Concerns
• The authentication of mobile devices prior to carrying out any
transaction is a major issue. In case of GSM, the Subscriber Identity
Module (SIM) is used for storing the cryptographic keys, unique
identity called International Mobile Subscriber Identity (IMSI). The
authentication server of the wireless GSM network stores the
matching key and the IMSI of the subscriber as well. The calls and
short messages in the GSM are handled by the SIM rather than the
mobile station holding the SIM card. The wireless network thus can
authenticate the SIM card. This mechanism of authentication is one
way where network is capable of authenticated the SIM but a SIM
user can not authenticate the network. The sound commerce
environment requires that both sides should be able to authenticate
each other.
Impediments in Mobile Commerce
• Competing Web Language
• The mobile devices can not handle full-fledged HyperText Markup
Language (HTML) documents. In order to offer web access and offer
similar services two competing but incompatible standards have
emerged. The mobile devices that adopt Wireless Access Protocol use
Wireless Markup Language (WML) for mobile commerce applications,
while the NTT DoCoMO’s iMode devices use a condensed version
HTML (cHTML). In order to enable the voice access and interface for
displaying the web content, the VoiceXML, a new markup language, has
also emerged. The incompatible standards make the task of mobile
commerce application and service providers even more complex.
Mobile Commerce Framework
Information Mobile
Dissemination Business Service Infrastructure, Legal Framework and Protocol/ device
and Network Standards compatible
Distribution publishing
(Middle Languages
ware) e.g., WML,
Protocols Mobile Payment Models cHTML,
WAP, iMode VoiceXML
44
Wireless Network Infrastructure
3 G Networks
45
Information Distribution Protocols:
Wireless Access Protocol Architecture
Web Server
WAP Gateway
WML
WML Scripts WML Encoder WML with Scripts
WTAI WML Script Interpreter
Protocol Adapter
Content through-
HTML, CGI
Information Distribution Protocols:
WAP Layered Architecture
Application
Layer (WAE)
Session
Layer (WSP)
Transport
Layer (WDP)
Bearers: GSM CDMA CDPD IS-136 iDEN
Information Distribution Protocols
WAP: Protocol Layers
• Bearer Networks:
• The Wireless Access Protocol operates over a variety of
wireless bearer mechanisms such as GSM’s GPRS and
EDGE, CDMA, CDPD, IS-136 and iDEN. The WAP works of
variety of bearer networks which may support the packet,
or connection oriented services. The user of WAP are
shielded from the details of the bearer network.
Information Distribution Protocols
WAP: Protocol Layers
_____________ _____________
Next Back
Greetings
Management School
Welcome to the World of
Management Schools:
1 IIM Lucknow
2 IIM Ahamadabad
3 IIM Kolkata
ABC Incorporated
1 Sales Office
2 Customer Service
• M-commerce
• In 2014 is 19 percent of all e-commerce
• Fastest growing form of e-commerce
• Some areas growing at 50 percent or more
• Main areas of growth (exclusive of location-based services)
• Retail sales at top Mobile 400 (Amazon, eBay, etc.)
• Sales of digital content (music, TV, etc.)
Consolidated Mobile Commerce Revenues
Figure 10-9 Mobile e-commerce is the fastest growing type of B2C e-commerce and represents about 19 percent of all
e-commerce in 2014.
M-commerce and M-commerce Applications
• Location-based services
• Used by 74 percent of smartphone owners
• Based on GPS map services
• Types
• Geosocial services
• Where friends are
• Geoadvertising
• What shops are nearby
• Geoinformation services
• Price of house you are passing
Interactive Session: Management
Figure 10-10
Building an E-commerce Presence
Phase 2: Web site Acquire content; develop a site design; arrange Web site plan
development for hosting the site
Phase 3: Web Develop keywords and metatags; focus on A functional Web site
Implementation search engine optimization; identify potential
sponsors
Phase 4: Social media Identify appropriate social platforms and content A social media plan
plan for your products and services
Phase 5: Social media Develop Facebook, Twitter, and Pinterest Functioning social media
implementation presence presence
Phase 6: Mobile plan Develop a mobile plan; consider A mobile media plan
options for porting your Web site
to smartphones
Table 10-8
Mobile Commerce
• Mobile commerce leverages security and ease of payments
on the pervasive mobiles, supporting innovative payment
solutions through mobiles
• Benefits include the ability to make payments without the
use of a computer or access to Internet and without a credit
card.
• Mobile transactions are similar to credit card transactions,
in that the merchant must have an account with the service
75
Doing Business on the Internet
The Internet presents a unique channel for business
characterised by:
• Almost instant communication through email, chat and
sharing of audio, video and text
• Ease of broadcasting instantly
• Lower costs of communication
• Ability to search huge amounts of information
• E-commerce refers to businesses created to use the Internet
technologies as a basis for transactions.
76
Doing Business on the Internet
• Portal – A web page that acts as an entry point to the web;
listing pages according to themes; they provide search
facilities; they re usually 'pure-play' in that they do not
involve any e-commerce, but this is changing fast
• Search Engine – A website that allows users to search for
pages on the Internet; early search engines crawled the
web, using the word-count method. Google used a Page
ranking algorithm to make searches more relevant and
introduced a differential pricing model for revenue
generation, leveraging IT
77
Direct Selling
• When goods are sold through a website, sellers directly
connect to buyers without intermediaries. Direct selling is
characterised by convenience, larger choice and the ability
to search easily which makes it popular for almost all kinds
of goods and services.
• E-commerce in developing countries like India are also
gaining ground
78
Direct Selling: Types of E-Commerce
79
Auctions and Aggregators
• Auctions – websites that allow sellers and buyers to meet
over the Internet; pricing may be through bidding or direct
pricing; usually C2C; use rating of users; subject to strong
network effects.
• Aggregators (B2B) – websites that allow institutional buyers
and sellers to transact over the Internet, managing the
entire bidding and sale process. Most aggregators deal with
industrial products.
80
Differences between B2B and B2C e-
commerce
• B2C transactions are ad-hoc in nature, with one seller,
selling to customers in a single transaction; B2B involves
many buyers and sellers who establish long-term purchasing
contracts
• B2C transactions are of low value vis-à-vis B2B transactions
• The delivery schedule and timing of goods are critical and
require high degree of commitment in B2B, since they tie
into organisational supply-chains
• B2B do not have fixed prices and may involve auctions
81
E-Business
• E-business enhances the internal functioning of businesses
by using the facilities of the Internet, to share data and
information with partners, outside the firm. The
infrastructure is HTML-based.
• Lowers transaction costs; faster and more accurate
communications;
• Secure communication;
• Supports distributed organisations with partners from
different countries
82
E-Governance
• E-business enhances the internal functioning of businesses by
using the facilities of the Internet, to share data and information
with partners, outside the firm. The
Refers to he use of e-business and e-commerce technologies by
governments and their departments to conduct their business
• Advantages -
• Reduced transaction costs
• Convenience – saves time, effort, money
• Higher accuracy
83
E-distributors
Slide 12-84
Types of Payment Systems
• Cash
• Most common form of payment
• Instantly convertible into other forms of value
• No float
• Checking transfer
• Second most common payment form in United States
• Credit card
• Credit card associations
• Issuing banks
• Processing centers
Types of Payment Systems (cont.)
• Stored value
• Funds deposited into account, from which funds are paid out or withdrawn as
needed
• Debit cards, gift certificates
• Peer-to-peer payment systems
• Accumulating balance
• Accounts that accumulate expenditures and to which consumers make period
payments
• Utility, phone, American Express accounts
Payment System Stakeholders
• Consumers
• Low-risk, low-cost, refutable, convenience, reliability
• Merchants
• Low-risk, low-cost, irrefutable, secure, reliable
• Financial intermediaries
• Secure, low-risk, maximizing profit
• Government regulators
• Security, trust, protecting participants and enforcing reporting
E-commerce Payment Systems
• Credit cards
• 42% of online payments in 2013
• Debit cards
• 29% online payments in 2013
• Limitations of online credit card payment
• Security, merchant risk
• Cost
• Social equity
Alternative Online Payment Systems
• Digital cash
• Based on algorithm that generates unique tokens that can be used in “real”
world
• Example: Bitcoin
• Virtual currencies
• Circulate within internal virtual world
• Example: Linden Dollars in Second Life, Facebook Credits
Insight on Society: Class Discussion
Bitcoin
• What are some of the benefits of using a digital currency?
• What are the risks involved to the user?
• What are the political and economic repercussions of a digital
currency?
• Have you or anyone you know ever used Bitcoin?
Electronic Billing Presentment and
Payment (EBPP)
E- Business Environment:
Use of Internet/Intranet/Extranet
Web based application development
Security controls:
Process
Cipher Text
Message
Sender Receiver
Encrypt code: One example
Code rewrite in reverse order
Digital Signature
Purpose: To ensure trust in electronic transaction, digital signature is
used so that parties involved cannot deny its authenticity.
Public keys are known to both parties while Private are secret
to the holder
Firewall
Internet
Firewall
Organization
Network
Firewall for Network Security
Internet/Intranet/Extranet
Firewall:
2. Nature of attacks
Password attacks
Insider attacks
Sniffers: Network management tools
Denial of service
IP spoofing: Attacks on IP Address
Hacking: Theft of information
Disaster Recovery Planning
Types of disasters:
Time,
Resources,
Determining
Roles, Response DRP
Responsibilities Specifications system
Escalation steps
Personnel
Contact Response
Information Procedures
Display
Hierarchy of Secure Practices
Adaptation
• Continuous Evolution/Improvement Level 5
• Threats anticipated & countered
Control
Managed, Measured, Level 4
Tracked, Improved.
Understanding
• Security planned
• SMS in place
Level 3
Awareness
• Awareness Training Level 2
• Informal procedures
Recognition
• Expresses the need
• Has a concern Level 1
for security.