CHAPTER THREE

EBUSINESS

Introduction

Ebusiness is the conducting of business on the Internet Ebusiness and Ecommerce are not the

same Issues

Disruptive technology Evolution of the Internet

Disruptive Technology (1)

A new technology that changes the accepted way of doing things Digital cameras disrupted Kodak (Film is

but a niche market)

Disruptive Technology (2)

The Web and online travel reservations disrupted travel agents

Online stock trading disrupted the full-service stock broker

Nobody carries change in a casino Netflix is disrupting media

distribution

Sustaining Technology

Using technology to improve a product or service Faster and larger hard drives Improvements in your bank’s Web site Faster wireless A bigger screen

The Internet (1)

As mentioned in the “history lesson” The Internet is a global network using

TCP/IP as it’s base protocol The Internet provides a range of

services including the World Wide Web It was originally text based There was no search engine until Jerry

Yang and David Filo created YAHOO (Yet Another Hierarchical Officious Oracle)

The Internet (2)

Probably one of the most disruptive technologies affecting business It has flattened the world If it’s repeatable, it can be done

anywhere

The Internet (Services)

SMTP – Simple Mail Transfer Protocol HTTP – Hypertext Transfer Protocol FTP – File Transfer Protocol SOAP – Simple Object Access

Protocol And many more

My Summary of the Net

The Internet allows us to buy and sell almost any good or service anywhere in the world at any time

The Internet (Selected Industries)

Travel Entertainment Electronics Financial services Retail Automobiles Education and training

Web 1.0

Mass customization (specialized version of a product)

Personalization (because we know who you are)

Disintermediation

Web 2.0

My opinion is that there exists no normative definition

Here is mine “A perceived second generation of the

Internet, marked by collaboration, Web-based communities, wikis, and social networking”

Facebook / Twitter / You Tube / MySpace

Web 3.0

With a large part of the world’s data out there, how to we find and catalog it?

A universal medium for data, information and knowledge exchange (Tim Berners-Lee) Data driven Semantic SOA and Web Services

The Data Driven Web

Much of the Web’s data is not well structured or indexed We have some metadata We have links We try to search keywords

The data driven Web will add structure to that data

The Semantic Web

A eutopic vision of content It requires the data driven Web

www.semanticweb.org

Ebusiness and Ecommerce

Ecommerce is a subset of Ebusiness Ecommerce is the buying and selling of

goods and services online Ebusiness involves conducting business

on the Internet largely to reduce transaction costs

It’s pervasiveB2B exchangesB2C exchangesC2C exchanges

Stock Exchanges

BATS CBOE CME NASDAQ NYSE Dark pools

ARCA EX – A sample BtoB Exchange

ArcaEx was the first totally electronic stock exchange Trades shares from nearly all exchanges Archipelago was bought by NYSE

Euronext Volume January 2005

Nasdaq-100 Index (QQQQ) 517,872,007 shares 23.3% of shares

Intel (INTC) 447,356,014 shares 27.8% Microsoft (MSFT) 398,670,288 shares

26% FOREX http://www.forex.com/forex_101.html)

Ebusiness Strategies

Sales and marketing Communication Financial services Procurement of goods and services Customer service Intermediaries

Ebusiness Stratigies (Sales)

It began with direct selling Pure-play retailing

Dell / Gateway / Amazon Multichannel retailing

JC Penney moves catalog sales to the Internet

Expanding reach That little bed and breakfast in Napa

Ebusiness Strategies (Communicaiton)

E-mail goes without saying Messaging systems Video and Web conferencing

Adobe / Citrix GoTo Meeting Blogs Wikis Mashups and APIs

Ebusiness Strategies (Marketing)

Popup and other ads RSS – You don’t ask for the data,

you just get it How does Google make money? How does Facebook make money?

Ebusiness Stratigies (Financial)

Online financial services has seen explosive growth Banking / stocks Online exchanges

New industries have emerged PayPal

The U.S is quite behind in micropayments

Ebusiness Stratigies (Procurement)

It’s now much easier to buy common business items Office supplies / etc

B to B exchanges www.alibaba.com

Ebusiness Strategies (Customer Service)

Self-service customer service tools Get current interest rates online Get product information online Repair manuals Electronic funds transfer

Ebusiness (Intermediaries)

Match buyers (consumers) and sellers (producers) in new ways

Create new markets (Ebay) (Match.com) (AliBaba.com)

Aggregate and disseminate content (wsj.com, CNBC)

Infomediaries (Web MD)

The distinction gets blurry and the roles are not mutually exclusive

Ebusiness (Social Media)

LinkedIn for business contacts Here is a non-canonical list

http://en.wikipedia.org/wiki/List_of_social_networking_websites#A

Electronic Data Interchange (EDI)

Your book does not really talk about this much

EDI automates nearly all common transactions Purchase orders / invoices / payments /

etc… Very complex to implement creating

a barrier to entry

Ebusiness Metrics (1)

Click-through tracking Users clicked on a Web site ad for

further information Web site pattern usage

How users navigate from page to page Per page view times

Completed shopping cart transactions

Tracking Web Site Visitors

Unidentified We know what you do but not who your

are Tracked with cookie

We know what you do and verify uniqueness but not identity

Identified / Authenticated We know who you are and everything

you do?

Ebusiness Challanges

International ecommerce laws don’t exist or are not enforceable

Security and trust Taxation Monetization of services

Government Trends in Ebusiness

Event the government has gotten on the Ebusiness bandwagon IRS electronic tax filings

Common DMV transactions are online along with common forms

We have done a terrible job with medical healthcare

Mcommerce

Mobile commerce is much more than ring tones Common stock and banking

transactions Pay per use applications Micropayments