E-Business

E-Business Chapter 1

E-commerce Developments and Themes- 2003

More:

пЃ® Use of the Internet to conduct commerce

пЃ® deepening of e-commerce channel

пЃ® Broadband and wireless Internet access

пЃ® refined e-commerce business models (в†' higher levels of profitability)

But at societal level: continued conflict over copyrights, content regulation, taxation, privacy, and Internet fraud and abuse.

E-commerce

E-business

E-commerce involves digitally enabled commercial transactions between and among organizations and individuals

в†' Digitally enabled transactions: all transactions mediated by digital technology

в†' Commercial transactions: exchange of value across organizational or individual boundaries in return for products or service. We use the term e-business to refer primarily to the digital enablement of transactions and processes within a firm, involving information systems under the control of the firm.

E-business does not include commercial transactions involving an exchange of value across organizational boundaries

Debate about meanings and limitations of terms e-commerce and e-business

Why Study E-commerce

пЃ® E-commerce technology is different and powerful

пЃ® E-commerce has challenged traditional business thinking and has a number of unique features

Seven Unique Features of E-commerce Technology and Their Significance

1. Is ubiquitous (available always + everywhere)

2. Offers global reach

3. Operates according to universal standards (lowers market entry for merchants and search costs for consumers)

4. Provides information richness (more powerful selling environment)

5. Is interactive (can simulate face-to-face experience on global scale)

6. Increases information density

7. Permits personalization/customization

Types of E-commerce

Classified by nature of market relationship

B2C B2B C2C

Involves online businesses attempting to reach individual consumers

Involves businesses focusing on selling to other businesses

Provides a way for consumers to sell to each other, with the help of an online market maker

Many types of business models within this category including online retailers, content providers, portals, transaction brokers, service providers, market creators and community providers

2 primary business models within B2B:

1. Net marketplaces (includes e-distributors, e-procurement companies, exchanges and industry consortia)

2. Private industrial networks (includes single firm networks and industry-wide networks) eBay most well-known example

$72-$78 billion (2002) $800 billion (2002)

Largest form of e-commerce $15 billion (by 2004)

Classified by type of technology used

P2P M-commerce

Uses technology, which enables Internet users to share files and computer resources without having to go through a central Web server Use of wireless digital devices such as cell phones and handheld devices to enable transactions on the Web

пЃ® Napster most well-known example

пЃ® Today, Kazaa is the leading network

Problem: under attack for copyright infringement пЃ® Most widely used in Japan and Europe (especially Finland)

пЃ® Expected to grow rapidly in U.S. over the next five years.

Growth of the Internet

The Internet is a worldwide network of computer networks built on common standards

пЃ® Internet was first created in 1960s

пЃ® Web is the most popular service on the Internet

Spider Webs, Bow Ties, and Scale-Free Networks

пЃ® Small world theory of Web (every Web page is thought to be separated from any other Web page by a small number of clicks) has been debunked by recent research

пЃ® Web has “bow-tie” form with a strongly connected component, In pages,Out pages, tendrils and tubes.

пЃ® Web = “scale-free network” with “very connected super nodes”

Origins and Growth of E-commerce

Precursors to e-commerce include

1970s Baxter Healthcare (in, used telephone-based modems to reorder supplies; in 1980s, became a

PC-based remote order entry system)

1980s Electronic Data Interchange (EDI) standards; permitted firms to exchange commercial^

documents and conduct digital commercial transactions across private networks

1980s French Minitel (videotext system; still in use today)

1995 Beginning of e-commerce to

First sales of banner ad space

1994 First banner advertisements

Since then, has been fastest growing form of commerce in U.S.

Technology and E-commerce in Perspective

пЃ® First,