Overview Ch. 7

Describe e-government to citizens (G2C) and to business (G2B)

Describe various e-government initiatives Discuss online publishing and e-books Describe e-learning and virtual universities Describe knowledge management and

dissemination Describe the processes involved in conducting

forward and reverse e-auctions Describe e-auction fraud and implementation

issues Analyze future directions of m-auctions

Chapter 8M-Commerce

Chapter 8M-Commerce

Learning Objectives

Describe the characteristics, attributes and drivers of m-commerce

Understand the supportive technologies and their capabilities

Describe the applications of m-commerce within organizations

Describe B2B and supply chain applications of m-commerce Describe consumer and personal applications of m-

commerce Describe location-based commerce

(l-commerce) Describe some implementation issues of m-commerce

M-Commerce Terminology

Generations 1G: 1979-1992 wireless technology 2G: current wireless technology; mainly

accommodates text 2.5G: interim technology accommodates

graphics 3G: 3rd generation technology (2001-2005)

supports rich media (video clips) 4G: will provide faster multimedia display

(2006-2010)

Specific Attributes of M-Commerce

Attributes of m-commerce and its economic advantages Mobility—users carry cell phones or other mobile

devices Broad reach—people can be reached at any time

Attributes of M-Commerce [2]

Value-added attributes of m-commerce Ubiquity—easier information access in real-time Convenience—devices that store data and have Internet,

intranet, extranet connections Instant connectivity—easy and quick connection to

Internet, intranets, other mobile devices, databases Personalization—preparation of information for individual

consumers Localization of products and services—knowing where

the user is located at any given time and match service to them

Characteristics of M-Commerce

The Drivers

Widespread availability of devices No need for a PC Handset culture Vendors’ push Declining prices Improvement of bandwidth Explosion of EC in general

Mobile Computing Infrastructure

Cellular (mobile) phones

Attachable keyboard PDAs Interactive pagers Other devices

Notebooks Handhelds Smartpads

Screenphones—a telephone equipped with color screen, keyboard, e-mail, and Internet capabilities

E-mail handhelds Wirelined—connected

by wires to a network

Hardware

Mobile Computing Infrastructure [2]

Unseen infrastructure requirements Suitably configured wireline or wireless WAN

modem Web server with wireless support Application or database server Large enterprise application server GPS locator used to determine the location of

mobile computing device carrier

Mobile Computing Infrastructure [3]

Software Microbrowser Mobile client operating system (OS) Bluetooth—a chip technology and WPAN standard that

enables voice and data communications between wireless devices over short-range radio frequency (RF)

Mobile application user interface Back-end legacy application software Application middleware Wireless middleware

Mobile Computing Infrastructure [4]

Networks and access Wireless transmission media

• Microwave• Satellites• Radio• Infrared• Cellular radio technology

Wireless systems

Wireless Standards and Security

M-commerce supported by Standards Security Voice systems

Wireless Standards

Wireless standards Time-division Multiple Access (TMDA) General Packet Radio Services (GPRS) Code Division Multiple Access (CDMA) CDMA One Global System of Mobile Communication (GSM) WLAN 802.11 (Wi-Fi) Wideband CDMA

Wireless Standards [2]

Wireless Application Protocol (WAP)—a set of communications protocols designed to enable different kinds of wireless devices to talk to a server installed on a mobile network, so users can access the Internet

Subscriber Identification Module (SIM) Wireless Markup Language (WML) Voice XML (VXML) Enhanced Data Rates for Global Evaluation (EDGE) Universal Mobile Telecommunications System (UMTS) IPv6

Security Issues

VirusesSmart card security solutions

Voice communication can be intercepted by hackers

One solution is an embedded biometric add-onBack-end security solutions—public

key infrastructure (PKI) and M-CERT (mobile certification)

Voice Systems for M-Commerce

Hands-free and eyes-free operations increase productivity, safety, effectiveness

Disabled people can use voice data for various tasks

Voice terminals are portable2 ½ times faster than typingFewer errors

Interactive Voice Response (IVR)

A computer voice system that enables users to request and receive information and to enter and change data through regular telephone lines or through 1G cell phones

• Patients schedule doctors’ appointments

• Users request pick-up from FedEx

• Employees find information, select, or change benefits packages

• Electric utilities can respond to customers reporting power outages

Voice Portals

A Web site with audio interface, accessed by making a phone call

• Request information verbally from system that:– Retrieves the information– Translates it into a computer-generated voice reply– Tells you what you want to know

• Iping.com—reminder and notification service• Helps businesses find new customers

Mobile Financial Applications

Wireless electronic payment systems Mobile phones become secure, self-contained

purchasing tools capable of instantly authorizing payments over the cellular network for goods and services consumed

Micropayments Electronic payments for small-purchase

amounts (generally less than $10)

Mobile Financial Applications [2]

M-wallet (mobile wallet) a wireless wallet that enables cardholders to

make purchases with a single click from their wireless devices

Bill payments directly from cell phone via: Bank Credit card Prepaid arrangement

Bill Payments by Cell Phone

Mobile Shopping Supported by CRM

Targeted Advertisement

Personalization of services and enhanced user interface for wireless Web pages from barnesandnoble.com Knowing user preferences or surfing habits

user-specific advertising messages to the location of mobile users

Using GPS marketers can send location-sensitive messages can be sent

Targeted Advertisement [2]

Get paid to listen to advertisements—listen to a 10–second ad before you dial your cell phone, and get 2 minutes of free long-distance time Program flopped in the U.S. SingTel of Singapore recouped its initial

investment from ad revenues in about a year

Targeted Advertisement [2]

Advertisement strategies and guidelines—Wireless Advertising Association (waaglobal.org) is trying to establish wireless ad guidelines Opt-in ad programs involving mobile message

alerts Addressing issues like spamming and unethical

strategies:• Confirmed opt-ins• Personally identifiable information• Push advertising

Wireless Advertising in Action

GPS helps target users from their location Vindigo.com: places to go and things to do in your

area GeePS.com: location-based start-up sent coupons

to customers cell phones Go2Online.com: locations-based Web domain helps

mobile travelers find anything (e.g., the nearest oil change)

Supporting Customers & Business Partners (Consumer Services)

Using voice portals in marketing and customer service Use vendor’s voice portal to check status of

deliveries to a job site Service technicians provided with diagnostic

information, enabling them diagnosis of difficult problems

Sales people check inventory status during a meeting to help close a sale

Supporting Customers & Business Partners(Consumer Services) [2]

Using mobile portals Mobile portal—a customer interaction channel

that aggregates content and services for mobile users

Portals charge for their services (per service or monthly fee):

• Public mobile portals (e.g., Imode in Japan)• Corporate portals

– Serve a corporation ’s customers and/or suppliers– E.g., major airline portals

Supporting Mobile Employees

Smartphones and hand-held devicesWearable wireless devices

mobile wireless computing devices for employees who work on buildings and other difficult-to-climb places

• Cameras Screen• Keyboard Touch-panel display

Supporting Mobile Employees [2]

Job dispatch Transportation (delivery of food, oil, newspapers,

cargo, courier services, tow trucks) Taxis (already in use in Korea and Singapore) Utilities (gas, electricity, phone, water) Field service (computer, office equipment, home

repair) Health care (visiting nurses, doctors, social services) Security (patrols, alarm installation)

Supporting Mobile Employees [2]

Sales force automation (SFA) tools Integrate software aimed at m-commerce

applications Equipped with smartphones providing easy

access to customer data at the central office

• Contact management information• Product and spare part availability• Deal tracking

Mobile B2B and Supply Chain Applications

Both sell-side and buy-side of ERP Unified messaging makes user’s device less of

an issue Telemetry drives supply chain efficiency and productivity

through automation of:• Data capture

• Improved billing timeliness and accuracy

• Reduced overhead

• Increased customer satisfaction Collaboration among members of the supply chain is

facilitated by mobile capabilities

Mobile Consumer and Personal Service Applications

Mobile gaming devices PDAs (Handspring’s Visor) with Flash RAM card Nintendo’s Game Boy Advance Sony’s PocketStation Sega’s portable device connected to Dreamcast

Mobile gambling Germany’s online lottery company fluxx.com available via

mobile terminals Hong Kong, betting on horse races via cell phones is

popular

Mobile Consumer and Personal Service Applications [2]

Mobile entertainment Music Video—real-time streaming video

(packetvideo.com)Hotels—hotel guests equipped with

Bluetooth-enabled mobile devices are instantly recognized

Intelligent homes and appliances

Mobile Consumer and Personal Service Applications [3]

Wireless telemedicine use of mobile telecommunications infrastructures and

multimedia technologies to provide medical information and deliver health care services remotely

Other services for consumers Providing news, weather, and sports reports Online language translations Information bout tourist attractions (hours, prices) Emergency services

Location-Based Commerce

Location-based commerce (L-commerce) E-commerce applications provided to customers based

on a user’s specific locationLocation-based technologies

Global positioning systems: a wireless system that uses satellites to enable users to determine their position anywhere on the earth

Geographical information systems (GIS): relates longitude and latitude of GPS into place or address (mapinfo.com)

GPS on handsets: stand-alone units for tracking applications

Location-Based Services Involving Maps

GPS System

L-Commerce Applications

E-911 Calls from cellular phones to providers of emergency

services• Wireless carriers must provide feature that allows them to

identify number and location of the user• Mobile 911 calls must be forwarded immediately to the

appropriate agency

Automatic crash notification (ACN) Device (now experimental) that will automatically

notify police of a vehicular accident

Telematics and Telemetry Applications

Telematics Integration of computers and wireless

communications to improve information flow using the principles of telemetry

• GM OnStar system—cellular phone and PDA are integrated to provide personal information management, mobile Internet services, entertainment on the vehicle vehicle dashboard

• Sophisticated text-to-speech and voice recognition capabilities minimize driver distraction

Telematics and Telemetry Applications [2]

Use as a remote vehicle self-diagnostics tool Daimler-Chrysler and Volvo experimented with installation

of GSM chip sets in cars

• Monitor performance and to provide an early warning system for potential problems

• Chip sends a message to the manufacturer indicating what the problem is

• Manufacturer’s system analyzes various data and provides a fix (via a software tool)

Developing faults found before they become critical and continuous operation of the car can be ensured

Barriers to L-Commerce

The accuracy of some of the location technologies

The cost-benefit justificationM-spamThe bandwidth of GSM networks

Limitations of M-Commerce

Usability problem Usability of a site is critical to attract attention

and retain user stickiness Effectiveness, efficiency, satisfaction Some mobile devices are found to be ineffective Customers want to find exactly what they are

looking for, easily and quickly, not possible in the 2G text-based environment

More and faster multimedia will be available as 3G spreads

Technical Limitations

Lack of standardized security protocol Security methodology

needs to be incorporated in mobile

Customer confidence is low

Insufficient bandwidth Limits the extent to

which mobility can be viewed commodity

3G licenses Auctioned by governments Certain countries cannot

be served by these devices Transmission & power

consumption limitations Multipath interference Weather and terrain

problems Distance-limited

connections

Technical Limitations [2]

WAP limitations Speed: in 2002 connections to WAP sites are

still too slow Cost: fees for mobile phone users are still too

high Accessibility: as of spring 2002, fewer than

50,000 WAP-accessible sites worldwide (must be written in WML)

Technical Limitations [3]

Potential health hazards Fear of radiation Unsafe to drive and use wireless phone Cell phones may interfere with sensitive

medical devices (pacemakers) Lawsuits relating to the potential health

hazards of wireless devices have already been filed—public is advised to adopt a precautionary approach in using mobile phones (earphone device)

Implementing M-Commerce

Basic (fixed) fees Point-of-traffic

fees Transaction fees Content and

service charges

Payment clearing Hosting fees Certification (PKI)

fees

Revenue models

Implementing M-Commerce [2]

Consumer confidence and trust Customers love free or inexpensive services

like those offered by iMode Customers not willing to pay large amounts of

money for services unless they trust the product/vendor

Confidence should increase with reliable payment mechanisms

Research is being conducted in this area

Implementing M-Commerce [3]

M-commerce value chain Involves many partners Success depends on

• Coordination among participants• Sufficient compensation for all

Use ASP to deliver m-commerce or Large companies contract other vendors to

complement their services

Summary

Characteristics and attributes of m-commerce

Drivers of m-commerce Supporting technologies Wireless standards and

technologies Finance and marketing

applications

Intrabusiness applications

B2B applications Consumer applications Non-Internet

applications L-commerce Limitations of m-

commerce

Exercise

Discuss the benefits of voice-based systems in m-commerce.

Discuss a mobile application that supports customers or provides a personal service.

Discuss one of the limitations of m-commerce. What are some options to decrease the importance of this limitation?