lecture1 is441-(intro toe-commerce)
TRANSCRIPT
Abdisalam Issa-Salwe
Taibah University
College of Computer Science & EngineeringInformation Systems Department
Introduction to e-Commerce
(e-Commerce IS441)
Lecture 1
Kenneth C. Lauden and Carol Guercio Traver, 2002 E-Commerce: Business, Technology and Society. Pearson Education, Inc.
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Learning Objectives
� Define e-commerce and describe how it differs from e-business
� Identify the unique features of e-commerce technology and their business significance
� Describe the major types of e-commerce
� Understand the visions and forces behind the E-Commerce I era
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Learning Objectives
� Understand the successes and failures of E-Commerce I
� Identify several factors that will define the E-commerce II era
� Describe the major themes underlying the study of e-commerce
� Identify the major academic disciplines contributing to e-commerce research
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Amazon.com: Before and After
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E-commerce vs. E-business
E-business involves
� Digital enablement of transactions and processes within a firm, involving information systems under the control of the firm
� E-business does not involve commercial transactions across organizational boundaries where value is exchanged
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The Difference Between E-commerce and E-Business
Page 8, Figure 1.1
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Seven Unique Features of E-commerce Technology and Their Business Significance
Page 9, Table 1.1
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Page 11, Figure 1.2
Changing Trade-Off Between Richness and Reach
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Major Types of E-Commerce
� Market relationships
� Business-to-Consumers (B2C)
� Business-to-Business (B2B)
� Consumer-to-Consumer (C2C)
� Technology-based
� Peer-to-Peer (P2P)
� Mobile Commerce (M-commerce)
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Major Types of E-Commerce
Page 14, Table 1.2
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Business-to-Consumer E-commerce
� Most commonly discussed type
� Online businesses attempt to reach individual consumers
� Consumers will spend $65 billion in 2001.
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Business-to-Business E-commerce
� Businesses focus on sell to other businesses
� Largest form of e-commerce
� $700 billion in transactions in 2001
� Primarily involved inter-business exchanges at first
� Other models have developed
� e-distributors
� infomediaries
� B2B service providers
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Consumer-to-Consumer E-commerce
� Provide a way for consumers to sell to each other
� Estimated $5 billion market
� Consumer:
� prepares the product for market
� places the product for auction or sale
� relies on market maker to provide catalog, search engine, and transaction clearing capabilities
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Peer-to-Peer E-commerce
� Enables Internet users to share files and computer resources
� Napster
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Mobile E-commerce
� Wireless digital devices enable transactions on the Web
� Uses personal digital assistants (PDAs) to connect
� Used most widely in Japan and Europe
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Growth of the Internet and the Web
� Created in the late 1960s
� After 1990s, About 350 million computers worldwide to date
� Links businesses, educational institutions, government agencies, and individuals
� Provides services such as e-mail, document transfer, newsgroups, shopping, research, instant messaging, music, video, and news
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Growth of the Internet and the Web
� Internet hosts are growing at a rate of 45% per year
� Extraordinary growth -- time to reach 30% US households
� Radio - 38 years
� Television - 17 years
� Internet/Web - 8 years (1993)
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The Growth of the Internet
Page 16, Figure 1.3
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The Growth of Web Content
Page 17, Figure 1.4
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The Growth of B2C E-Commerce
Page 20, Figure 1.5
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The Growth of B2B E-Commerce
Page 21, Figure 1.6
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Origins and Growth of E-Commerce
� Electronic Data Interchange (EDI) standards developed that permitted firms to exchange commercial documents and conduct digital commercial transactions across private networks (1980s)
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Technology and E-Commerce in Perspective
Internet and the Web are just two of a long list of technologies that have greatly change commerce
� Other technologies spawned business models and strategies
� Explosive early growth followed by retrenchment and then long-term successful exploitation of the technology
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Technology and E-Commerce in Perspective
Although e-commerce has grown explosively, there is no guarantee it will continue to grow
� Confront own fundamental limitations
� B2C only about 1% of overall retail market
� With current growth rates, B2C will roughly equal the annual revenue of Wal-Mart in 2005
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Limitations of the Growth of B2C E-CommercePage 23, Table 1.3
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E-Commerce I and II
� E-Commerce I
� Explosive growth starting in 1995
� Widespread of Web to advertise products
� Ended in 2000 when dot.com began to collapse
� E-Commerce II
� Began in January 2001
� Reassessment of e-commerce companies
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E-Commerce I 1995-2000
� For computer scientist and information technologists
� Vindication of a set of information technologies developed over 40 years
� Extending from the early Internet to the PC and local area networks
� The vision of universal communications
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E-Commerce I 1995-2000
� For economists
� Raised realistic prospect of perfect Bertrand Market
� where price, cost, and quality information is equally distributed
� where a nearly infinite set of suppliers compete against one another
� where customers have access to allrevelant market information worldwide
� Merchants have equal direct access to hundreds of millions of customers
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E-Commerce I 1995-2000
Disintermediation
� displacement of market middlemen who traditionally are intermediaries between producers and consumers by a new direct relationship between manufacturers and content originators with their customers
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E-Commerce I 1995-2000
Friction-free commerce
� a vision of commerce in which
� information is equally distributed
� transaction costs are low
� prices can be dynamically adjusted to reflect actual demand
� intermediaries decline
� unfair competitive advantages are eliminated
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E-Commerce I 1995-2000
� First mover
� a firm that is first to market in a particular area and that moves quickly to gather market share
� Network effect
� occurs where users receive value from the fact that everyone else uses the same tool or product
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Amounts Raised by Venture-Backed Internet Companies in 1996-2000
Page 25, Table 1.4
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E-Commerce II 2001-2006
� Crash in stock market values of E-commerce I companies throughout 2000 is an end to E-commerce I
� Led to a sobering reassessment of the prospects of e-commerce and the methods of achieving business success.
� E-commerce II begins in 2001 and ends five year later -- the limit for making technology and business projections
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E-Commerce II 2001-2006
� Reasons for the end of E-Commerce I
� run-up in technology stocks due to enormous information technology capital expenditure of firms rebuilding their internal business systems to withstand Y2K
� telecommunications industry had built excess capacity in high-speed fiber optic networks
� 1999 e-commerce Christmas season provided less sales growth that anticipated and demonstrated e-commerce was not easy (eToys.com)
� valuations of dot.com and technology companies had risen so high supporters were questioning whether earnings could justify the prices of the shares.
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E-Commerce I and E-Commerce II Compared
Page 32, Table 1.5
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April 2001 NRF/Forrester Online Retail Index
Page 33, Table 1.6
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Understanding E-Commerce: Organizing Themes
� Technology: Infrastructure
� development and mastery of digital computing and communications technology
� Business: Basic Concepts
� new technologies present businesses and entrepreneurs with new ways of organizing production and transacting business
� Society: Taming the Juggernaught
� global nature of e-commerce poses public policy issues of equity, equal access, content regulation, and taxation
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The Internet and the Evolution of Corporate Computing
Page 37,
Figure 1.8
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Disciplines Concerned with E-Commerce
Page 39, Figure 1.9
References
� Kenneth C. Lauden and Carol Guercio Traver, E-Commerce: Business, Technology and Society. Pearson Education, Inc. 2002.
� Abdisalam Issa-Salwe, Lecture Notes: E-Business and E-Commerce, Arab Open Univeristy Notes, 2012.
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