E-COMMERCE TECHNIQUES

(For [Link](BT), Semester - IV)

Subject code : 17UCSA04

Prepared By
[Link], MSC.,MPhil.,

DEPARTMENT OF COMPUTER SCIENCE

SALEM SOWDESWARI COLLEGE

SELF - FINANCING COURSES WING

SALEM – 10

Version: 2018 – 2019 - 1.0

 Contents
UNIT-I...........................................................................................................1
1.1 HISTORY OF E-COMMERCE AND INDIAN BUSINESS CONTEXT............1
1.1.1 ECOMMERCE.................................................................................1
1.2 EMERGENCE OF THE INTERNET..........................................................3
1.3 EMERGENCE OF THE WWW................................................................5
1.4 ADVANTAGES OF E-COMMERCE.........................................................8
1.4.1 DISADVANTAGES OF E-COMMERCE............................................10
1.5 TRANSITION TO E-COMMERCE IN INDIA............................................11
1.6 THE INTERNET AND INDIA................................................................12
1.7 E-TRANSITION CHALLENGES FOR INDIAN CORPORATE....................14
1.8 BUSINESS MODELS FOR E-COMMERCE.............................................17
1.8.1 BUSINESS MODELS.....................................................................17
1.9 E-BUSINESS MODELS BASED ON THE RELATIONSHIP OF
TRANSACTION PARTIES..........................................................................20
1.10 E-BUSINESS MODELS BASED ON THE RELATIONSHIP OF
TRANSACTION TYPES..............................................................................27
UNIT-II........................................................................................................32
2.1 ENABLING TECHNOLOGIES OF THE WORLD WIDE WEB....................32
2.1.1 WORLD WIDE WEB......................................................................32
2.2 INTERNET CLIENT-SERVER APPLICATIONS......................................33
2.3 NETWORKS AND INTERNETS............................................................35
2.4 SOFTWARE AGENTS INTERNET STANDARD AND SPECIFICATION.....36
2.5 ISP....................................................................................................38
2.6 E-MARKETING...................................................................................42
2.6.1 TRADITIONAL MARKETING..........................................................42
2.6.2 IDENTIFYING WEB PRESENCE GOALS.........................................43
2.7 ONLINE MARKETING..........................................................................47
2.8 E-ADVERTISING.................................................................................49
2.9 E-BRANDING.....................................................................................55
UNIT-III.......................................................................................................58
3.1 E-PAYMENT SYSTEMS.......................................................................58
3.2 MAIN CONCERNS OF INTERNET BANKING SYSTEM...........................59
3.2.1 INTERNET PAYMENT SYSTEMS....................................................59
 3.2.2 ONLINE PAYMENT OPTIONS........................................................60
3.1.3 DIGITAL PAYMENT REQUIREMENTS.............................................65
3.4 DIGITAL TOKEN BASED ELECTRONIC PAYMENT SYSTEM IN E-
COMMERCE.............................................................................................66
3.5 CLASSIFICATION OF NEW PAYMENT SYSTEMS..................................67
3.6 PROPERTIES OF E-CASH :TO PURCHASE ITEMS OVER THE INTERNET
...............................................................................................................72
3.2.2 WIRELESS APPLICATION..............................................................82
3.2.3 CELLULAR NETWORKS................................................................84
3.2.4 WIRELESS SPECTRUM.................................................................87
3.2.5 TECHNOLOGIES FOR MOBILE COMMERCE..................................93
3.2.6 WIRELESS TECHNOLOGIES.........................................................94
UNIT - IV..................................................................................................100
4.1 HTML AND WEB DESIGNING...........................................................100
4.1.1 BRIEF HISTORY OF HTML..........................................................100
4.1.2 HTML TAGS...............................................................................101
4.1.3 TABLE CREATION......................................................................102
4.1.4 HYPERLINK................................................................................104
4.1.5 REFERENCE...............................................................................105
4.1.6 HEADINGS.................................................................................105
4.1.7 ALIGNMENT...............................................................................105
4.1.8 SIMPLE WEB PAGE CREATION...................................................105
UNIT - V...................................................................................................107
5.1 E-MAIL............................................................................................107
5.1.1 E-MAIL.......................................................................................107
5.1.2 EMAIL COMPONENTS................................................................108
5.1.3 USE OF EMAIL...........................................................................109
5.1.4 EMAIL CREATION......................................................................110
5.1.5 BROWSING................................................................................114
5.1.6 SEARCH ENGINES.....................................................................114
5.1.7 DOWNLOADS............................................................................115
MODEL QUESTION PAPERS......................................................................117
OBJECTIVE TEST......................................................................................119
 E-COMMERCE TECHNIQUES

UNIT- I
History of E-commerce and Indian Business Context: E-Commerce -
Emergence of the Internet - Emergence of the WWW - Advantages of E-
Commerce - Transition to E-Commerce in India - The Internet and India -
E-transition Challenges for Indian Corporate. Business Models for E-
commerce: Business Model - E-business Models Based on the Relationship
of Transaction Parties - E-business Models Based on the Relationship of
Transaction Types.

UNIT- II

Enabling Technologies of the World Wide Web: World Wide Web - Internet
Client-Server Applications - Networks and Internets - Software Agents -
Internet Standards and Specifications - ISP.E-Marketing : Traditional
Marketing - Identifying Web Presence Goals - Online Marketing - E-
advertising - Ebranding.

UNIT- III

E-Payment Systems: Main Concerns in Internet Banking - Digital Payment

Requirements - Digital Token-based e-payment Systems - Classification of
New Payment Systems - Properties of Electronic Cash - Cheque Payment
Systems on the Internet. Information systems for Mobile Commerce:
Introduction - Wireless Applications - Cellular Network - Wireless Spectrum
- Technologies for Mobile Commerce - Wireless Technologies

UNIT- IV

HTML and Web Designing: Brief History of HTML - HTML Tags - Table
Creation - Hyperlink - Reference - Headings - Alignment - Simple Web
Page Creation.

UNIT- V

E-mail: Email - Email Components - use of Email-Email creation-browsing-

search engines-downloads.

TEXT BOOKS

1. [Link], "E-Commerce - An Indian Perspective", 4th Edition, PHI

Learning, 2012.

2. C Xavier, "World Wide Web Design with HTML", 13th Reprint, Tata
McGraw Hill, 2006.
Salem Sowdeswari College –Self financing courses wing

UNIT-I

1.1 HISTORY OF E-COMMERCE AND INDIAN BUSINESS CONTEXT

E-commerce has become a buzzword for businesses over the past

few years, with increased awareness about the use of computer and
communications technologies to simplify business procedures and
increase efficiency. Combining a range of processes, such as

 Electronic Data Interchange (EDI).

 Electronic Mail (e-mail)
 World Wide Web (www).
 Internet Applications.

1.1.1 ECOMMERCE

E-commerce provide a ways to exchange information between

individuals, companies and countries between computers. E-commerce is
the movement of business onto the world wide web. This movement has
been broken up into two main sectors:
• Business-to-business(B2B).
• Business –to-consumer(B2C).
E-comprises core business processes of buying, selling goods,
services and information over the internet. The e-commerce information
available on the internet huge and still growing. currency conversions,
tariffs, import and export restrictions, local business customs and law of
each country in which a trading partner resides can make international
electronic commerce difficult.
Many of the international issues that arise, relate to legal, tax and
privacy concerns. Each country has the right to pass laws and levy taxes
on businesses that operate within its jurisdiction. E-commerce is already
very big and it is going to get much bigger. But the actual value to
transactions currently concluded online dwarfed by the extraordinary

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influence the internet in over purchases carried out in the offline world.
That influence is becoming an integral part of e-commerce.
a)Early business information interchange efforts:
The emergence of large business organizations in the late and early
1900s triggered the need to create and maintain formal records of
business transactions. In the 1950s, companies began to use computers
to store and process internal transaction records, but the information
flows between businesses continued to be on paper. Purchase orders ,
invoices, bills of lading, cheques, remittance advices, and other standard
forms were used to document transactions.
The process of using a person or a computer to generate a paper
form, mailing that form, and then having another person enter the data
into the trading partners computer was slow, inefficient, expensive,
redundant, and unreliable. By the 1960s, businesses that engaged in large
volumes of transactions had begun exchanging transaction information on
punched cards or magnetic tape. Data communications technology are
allowed trading partners to transfer data over telephone lines instead of
shipping punched cards or magnetic tapes to each other.
The American national standards institute(ANSI) has been the
coordinating body for standards in the united national states since 1918.
ANSI does not set standards, though it creates procedures and
organizational standards for the development of national standards and
accredities committees that follow those procedures.
In 1979, ANSI chartered a new committee to develop uniform EDI
standards. This committees is called the Accredited Standards Committee
X12. The committee meets three times a year to develop and maintain
EDI standards. The committee and its subcommittees include information
technology professionals from over 800 businesses and other
organizations.
In 1987, the united nations published its first standards under the
title EDI for Administration, Commerce, and Commerce and Transport
(EDIFACT, or UN/EDIFACT).EDI began to view the internet as a potential
replacement for the expensive leased lines and dial-up connections. The

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lack of third-party verification continues to be an issue, since the internet

has no built-in facility. Because EDI transactions are business contracts
and often involve large amount of money, the issue of non-repudiation
causes significant concern.

1.2 EMERGENCE OF THE INTERNET

Using the internet, you can communicate with other people

throughout the world by means of e-mail, read online versions of
newspapers, magazines, academic journals, and books, participate in
games and obtain free computer software. In recent years, the internet
has allowed commercial enterprises to connect with one another and with
customers.
In the early 1960s, the us department of defense became very
much concerned about the possible effects of a nuclear attack on its
computing facilities. The Defense Department realized the need for
powerful computers for coordination and control. The powerful computers
of that time were all large mainframe computers. So the Defense
Department began examining ways to connect these computers to each
other and also to weapon installations that were distributed all over the
world. The Defense Department agency charged with this task, hired
many of the best communications technology researchers. These
researchers worked to devise ways to build networks that could operate
independently. Networks that would not require a central computer to
control network operation.
The world telephone companies were early models for network
computers. because early network of computers used leased computer
telephone company line for their connection. telephone company system
of that time established a single connections between a buyer and sender
for each telephone calls, and that connections carried all the along the
single path. when a company wanted to connect computer it owned at
different different location. it placed a telephone call to establish a
connection and then connected one computer to each end of that single
connection. The number of network user in the country and education

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research communities continued to grow. Many of these new participants

used the technology to transfer files and access remote computers. The
network software included tow tools for performing these task. File
Transfer Protocols (FTP) enable user to transfer files between computers.
and telnet user log on their computer account from remote sites. both FTP
and Telnet are still widely used on the internet for file transfers and
remote logins, even though more advanced techniques are now available
that allow multimedia transmissions such as real-time audio and video
clips.
The first e-mail mailing lists also appeared on these networks. In
1979, a group of students and programmers at the duke university and
the university of north Carolina started usenet. Usenet allows anyone who
connects to the network to read and post articles on a variety of subjects.
the defense department’s networking software became more widely used
as academic and research institutes realized the benefits of having a
common communications networks.
a)Commercial use of the Internet
As personal computers became more powerful, affordable, and
available during the 1980s, companies increasingly used them to
construct their own internal networks. although these networks included
e-mail software that enabled the employees to send messages,
businesses wanted their employees to be able to communicate with
people outside their corporate networks for promoting business. The
defense department network and most of the other academic networks
that had teamed up with it were receiving funding from the national
science foundation(NSF). The NSF prohibited commercial network traffic
on its networks and so business turned to commercial e-mail service
providers to handle their e-mail needs. Large firms built their own
networks that used leased telephone lines to connect field offices to
corporate headquarters.
In 1989, the NSF permitted two commercial services, MCI mail and
Compuserve to establish limited connections to the internet for the sole
purpose of exchanging e-mail to send e-mail transmissions with users of

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the internet addresses and allowed members of the research and

education communities on the internet to send e-mail directly to MCI Mail
and Compu Serve addresses. The NSF justified this limited commercial use
of the internet as a service that would primarily the Internet’s non-
commercial users.

b)Growth of the Internet

In 1991, the NSF further eased its restrictions on internet
commercial activity and began implementing plans to privatize the
internet. the privatization of the internet was susbstantially completed in
1995, when the NSF turned over the operation of the main internet
connections to a group of privately owned companies. the new internet
structure was based on your Network Access Point (NAPs), each operated
by a separate company. These companies, which are known as network –
access providers, sell internet access rights directly to larger customers
are indirectly to smaller firms through other companies, called Internet
Service Providers (ISPs).
The internet was a phenomenon that truly sneaked into an
unsuspecting world. The researchers who had been so involved in the
creation and growth of the internet just accepted it as a part of their
working environment. People outside the research community were
largely unaware of the potential offered by a large interconnected set of
computer networks.
The opening of the internet to business activities helped increase
the internet’s growth. there was another development that worked hand
with the commercialization of the internet to its growth. That development
was the World Wide Web (WWW).

1.3 EMERGENCE OF THE WWW

The web is more a way of thinking about and organizing information

storage and retrieval than a technology. As such, its history goes back to
many years. Two important innovations played key roles in making the

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internet easier to use and more accessible to people who were not
research scientists. These two innovations were Hypertext and Graphical
User Interfaces (GUIs).
a)Origins of the Web
In 1945, Vannevar Bush, who was director of the US Office of
Scientific Research and Development, wrote an atlantic monthly article
about ways that scientists could apply the skills they learned during World
War II to peacetime activities. The article included a number of visionary
ideas about future uses of technology to organize and facilitate efficient
access to information. Bush speculated that engineers would eventually
build a machine that he called information. Hypertext, as implemented on
the Web, however, has its origin in the start of the electronic computer
age, when ideas about associative linking could be married with the
possibilities of automated storage – and – retrieval systems. In 1965, Ted
Nelson coined the term hypertext to describe a text that is not
constrained to be sequential. Hypertext therefore is more than just
footnotes that serve as commentary or further information in a text. It
extends the structure of ideas by making ‘chunks’ of ideas available for
inclusion in many parts of multiple texts. It is not constrained to be text. It
can include the combination of text pictures, graphics, sound and
[Link] important components of the proposal follow:
 A user interface that would be consistent with all platforms and that
would allow users to access information from many different
computers.
 A scheme for this interface to access, which would allow any user on
the network to access any information.

Hypertext Transfer Protocol (HTTP) is the internet protocol

responsible for transferring and displaying web pages. HTTP runs in the
application layer of Transmission Control Protocol/Internet protocol
(TCP/IP) model. Like the other internet protocols, HTTP employs the client-
server model in which a user’s web browser opens an HTTP session and
sends a request to remove server for a web page. In response, the server

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creates an HTTP response message that is sent back to the user’s web
browser. The response contains the page displayed by the client’s
browser. After the client determines that the message it received is
correct, the TCP/IP connection is closed and the HTTP session ends. The
process is demonstrated in this figure

The number of world wide web users continues to double in size about
every 12 to 15 months. All of these have had an impact. The internet
offers a range of messaging techniques, all of which work rapidly. The
standards used to make it work are not all ratified by international
standards to be agreed has surely accelerated the growth in the number
of Internet users.

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1.4 ADVANTAGES OF E-COMMERCE

Some of the key strengths of using the Internet for businesses

include the following:
24*7 operation
Round-the-clock operation is an expensive proposition in the brick-
and-mortar world, while it is natural in the ‘click – and – conquer’ world.
Global reach
The net being inherently global, reaching global customer is
relatively easy on the net compared to the world of bricks.
Cost of acquiring, serving and retaining customers
It is relatively cheaper to acquire new customers over the net;
thanks to 24 * 7 operation and its global reach. Through innovative tools
of ‘push’ technology, it is also possible to retain customers loyalty with
minimal investments.
An extended enterprise is easy to build
The Internet provides an effective (often less expensive) way to
extend your enterprise resource planning (ERP), supply chain
management (SCM) and customer relationship management(CRM), can
easily be deployed over the Internet, permitting amazing efficiency in

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time needed to market, customer loyalty, on-time delivery and eventually

profitability.
Disintermediation
Using the Internet, one can directly approach the customers and
suppliers, cutting down on the number of levels and its process, cutting
down the costs.
Improved customer service to your clients
It results in higher satisfaction and more sales.
Power to provide the ‘best of both the worlds
It benefits the traditional business side-by-side with the Internet
tools.
A technology-based customer interface
The customer interface in the electronic environment is a ‘screen-to-
face’ interaction. This include PC-based monitors, ATM machines, PDAs, or
other electronic devices . These types of interfaces place an enormous
responsibility on the organization to capture and represent the customer
experience because there is often no opportunities for direct human
intervention during the encounter. If the interface is designed correctly,
the customer will have no need for a simultaneous or follow-up phone
conversation. Thus, the ‘ screen – to – customer ‘ interface has the
potential to both increase sales and decrease costs. In fact a number of
innovators are entering the e-commerce markets with solutions that
demand for web users. Thus, a Poorly designed customer interface has
both negative revenue and cost implications.
The customer controls the interaction
The customer is in control during screen-to-face interaction, which
employs a ‘self service’. The customer controls the search process, the
time spent on various sites, the degree of price/product comparison. At a
minimum, the seller attempts to influence the buying process by
directing the potential buyer to different products or locations in the store,
overcoming price objections and reading in real time to competitive
offering. However, the seller has much less power in the online

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environment due to the control and information flows that the online
world puts in customer’s hands.
Knowledge of customer behavior
While the customer controls the interaction, the firm has
unprecedented access to observe and track individual consumer behavior.
Companies, through a third-party measurement firm such as Vividence
and Accrue. This level of customer behavior tracking, in contrast with
tracking consumer attitudes, knowledge or behavior intentions, is not
possible in the brick-and-mortar world. Electronic retailers can welcome a
user back by name. An online business can actually position offers and
merchandise in way that uniquely appeal to specific customers.
Network economics
In information intensive industries, a key competitive centres on the
emergence of industry-standard products, services, components and or
architecture. It applies both hardware (eg, cable modems versus DSL
lines) and software (eg, MP3 versus streaming audio). A key result of
network effects and positive feedback is increasing return economics as
compared to the traditional decreasing returns model often associated
with the brick-and-mortar world. It also means that the traditional realities
of marketing such as the importance of word-of-mouth (WOM) among
potential customers, become greatly magnified in this new environment.
It makes viral marketing a reality for consumer-oriented e-commerce
business such as ICQ in instant messaging system.

1.4.1 DISADVANTAGES OF E-COMMERCE

Some businesses may never lend themselves to electronic
commerce. For eg, perishable foods, and high-cost items (such as
jewellery , antiques, and the like),may be difficult to inspect from a
remote location, regardless of any technologies that might be devised in
the future. Most of the disadvantages of electronic commerce today,
however, stem from the newness and rapidly developing pace of the
underlying technologies. These disadvantages will disappear as e-
commerce matures and becomes more and more available to and get
accepted by the general population. Many products and services require a

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critical mass of potential buyers who are well-equipped and willing to buy
through the internet.
Businesses often calculate the return-on-investment before
committing to any new technology. This has been difficult to do with e-
commerce, since the cost and benefits have been hard to quantify. Costs,
which are a function of technology, can change dramatically even
dramatically. Even during short – lived e-commerce implementation
projects, because the underlying technologies are changing rapidly. Many
firms have had trouble in recruiting and retaining employees with
technological, design, and business process skills needed to create an
effective e-commerce atmosphere. Another problem facing firms that
want to do business on the internet is the difficulty of integrating existing
databases and transaction-processing software designed for traditional
commerce into a software that enables e-commerce
In addition to technology and software issues, many businesses face
cultural and legal obstacles in conducting e-commerce. Some consumers
are still somewhat fearful of sending their credit card numbers over the
internet. The legal environment in which e-commerce is conducted is full
of unclear and conflicting laws. In many cases, government regulators
have not kept up with the trends in technologies.

1.5 TRANSITION TO E-COMMERCE IN INDIA

The potential for e-commerce is enormous in india, owing to the

rapid growth of the number of internet users. The enormous saving in
time and money achieved by both buyer and sellers is the principal
advantage.
a)Indian Readiness for E-commerce:
The proliferation of the net at a rapid pace and the granting of
private ISP (Internet Service Provider) licenses has put the market en
route to a new phase. Even small and medium enterprises(SMEs) have
been increasingly realizing the potential of the net.

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The technological advancements happening in all spheres of life in

india will be the driving factors for the spread of e-commerce in this
country, as has happened elsewhere in the world. NASSCOM (National
Associatiation of Software and Service Companies), has recently released
the findings of its survey to evaluate the e-commerce scenario in india. E-
Commerce is dependent to a great extent, on the number of internal
users in india. The following tables give the rate of growth of internet
users in india.
a)Growth Of Internet In India
Tables:

1.6 THE INTERNET AND INDIA

The internet has undergone a steady evolution from being a source

of instant communication in the early 90s to a rich source of infotainment
and education. This evolution has been driven by the growing customer
expectations with the content of internet. Thus, newer segments of
internet usage have emerged and there lie potential user segments that
are still unexplored and may emerge in the future.
Five years ago there was limited internet access but only in a few
major cities, all in the hands of the government. VSNL, the agency
responsible for internet activities, and the DOT (Department of

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Telecommunications) provided an erratic connectivity, and bandwidth and

far too few phone lines. Connection rates ran as low as 5% and users were
frequently cut off. And the rates for this pathetic level of services were
among the highest in the world. By the end of 1998, after three years of
government monopoly, there were barely 1, 50,000 internet connections
in india.
Diagram

Presently, the government monopoly is largely over. Dozens of small to

large Internet Service Providers have set up shop, triggering a price war
and an improvement of service. Users are now estimated at over 37
million, with a growth predicted to reach more than 50 million in the next
three years.

According to the NASSCOM survey, considering the interest the

government is taking in the growth of the market, e-commerce in india
will witness a significant jump over the next three years. Based on these
preliminary findings, experts have concluded that the penetration of the

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internet and e-commerce transaction in india will increase by leaps and

bounds. The survey findings also point to the fact that india’s active
internet population would spend close to 3.2 percent of its total regular
household spending through internet purchase.
Revenue streams will increasingly be aligned with the emerging
blobal model, it is being anticipated. This would mean that the major part
of the revenues would come from transactions, while a smaller amount
would be realized from advertising. It is expected that by 2003, more than
75 percent of the revenues of internet business-to-customer businesses
would come from transactions. Indian software and services companies
need to tap into some of these vertical segments to gain the maximum
advantage in the e-commerce solution sector.
Financial services:
A large number of users use the internet for some form of financial
guidance.
Stock trading:
Online stock trading is nowadays one of the most demanding e-
commerce utilities. The ability to offer market access at a competitive
price is a key advantage of online stock broking companies and this is
slowly happening in india too.
Banking:
Internet banking is now growing. Many banks like ICICI and HDFC
are making inroads into this area.

Legal and professional services:

Opportunities also exist for Indian companies in legal and other
professional services. There are significant legal and regulatory
implications of implementing an internet business or migrating from a
traditional off-line business. In terms of opportunities for Indian legal
service providers, the requirement for professional, legal and regulatory
advice is expected to increase as the number of e-commerce users
increases.
Tour and Travel:

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The travel industry has readily to e-commerce. There has been a

growing emphasis on the search for alternative distribution channels
within the sector , particularly with the railways and the airlines, as they
seek to reduce costs. These sectors have adapted well because of their
online reservation systems,.
Healthcare:
It represents one of the biggest expenditures of governments
worldwide. The internet has the potential to enhance communications,
streamline processes and create new business opportunities, by providing
high-quality administrative service and integrating information systems.

1.7 E-TRANSITION CHALLENGES FOR INDIAN CORPORATE

Some issues that corporate face while e-transforming themselves

are worth delving into, in the following manner:
a)Internal Resisting Issues:
[Link] wrangles:
With organizations e-transforming themselves, the old ways of doing
things are being replaced by new ways which destabilize the existing
power equations. The fear of this among the staff is a significant barrier to
the organizational transformation.
[Link] changes:
The e-biz team spearheading the e-com initiatives in an organization,
mostly consists of young, externally recruited, tech savvy populace who
maintain a ‘skunkwork’ like culture. This open culture may be in direct
conflict with the already established culture in the organization and may
force the old-timers to oppose any change.
[Link] many are prepared:
A survey by the GIIC found out that only 20 per cent of the organizations
covered under the CIO segment are trying to use e-commerce at least to
some extent. Eighty per cent of the industry is in the process of gearing
up for the show , such as banks and sectors like IT, courier, travel and
transport.
[Link] of skill and training:

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Lack of skill and training within a company (28 per cent) and lack of funds
(24 per cent) are other factors impeding the implementation of IT in
companies. Most of these companies are from traditional businesses like
manufacturing, travel, transport and education.
b)External Driving Factors:
[Link] necessity:
No one will dispute the argument that any business will benefit if it
cuts down the processing time for a transaction. E-commerce does exactly
increases process efficiency by reducing transaction time and this can
have a significant impact on cash flows and the bottom line.
[Link] business, the driving factor:
Business entities will themselves be the key drivers. The big bosses
of the industries will be the guiding and forcing factor for SMEs to adopt
the internet. If the same happens in india and companies like HLL, maruti,
TELCO, Reliance Industries and other major players in their respective
segments make it mandatory to have their dealers, suppliers and other
linked to their supply chain on the Internet, one can imagine the
stampede that will ensue. These companies must have their supply chain
e-driven, if they are to compete in the global market, and this again will
lead to growth in the B2B segment.
[Link] Market:
If you are looking at ‘ the world as your market’, e-commerce will fit
in neatly with your plans. Globalization is forcing organizations to achieve
new competitive levels in order to enter the world market. It is imperative
that we get on to the e-commerce bandwagon for the sheer efficiencies
that it can generate.
[Link] for money:
E-commerce will be one of the key factors in propelling B2C growth
in the indian market. Te driving factors for the B2C segment will be
convenieece, low cost to end – consumers and a wider choice. If you take
a look at the products available on [Link],most products are available
at discount of 20-50 per cent over the price in the physical world.
[Link]-entry barriers:

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The good thing about the internet is that one does not deep pockets
to be successful. It will not take much resource or time for a new entrant
to compete with you. Barnes & Noble, the dominant player with huge
financial resources, watched its market share being eroded by the upstart,
forcing it finally to get on the e-commerce bandwagon. If this can happen
with Barnes & Noble, it can happen with your business too. So can you to
your established competitor.
[Link] Factors:
With the private ISPs becoming aggressive and also looking at the
huge cable market to provide Internet connections, it is only a matter of
time before subscriber numbers start looking up.
c)Doubts and Difficulties:
[Link] are shaky about buying over the Internet:
A very high proportion among PC owners and PC non-owners opine
that they would not like to but through the internet. The reasons are they
are not sure of the quality and the delivery of the products. They need to
feel the products and bargain before they buy them. Many do not
understand the new methods of buying and selling in a digital
environment, and forces the corporate to adopt a wait and watch policy.
[Link] are not bought for browsing the Internet:
Browsing the internet and purchasing through the Internet and
purchasing through the internet are among the least important perceived
benefits of owing a computer. Business, learning(self) and education for
children are so far given as the main reasons for purchasing a computer.
[Link] of proper commercial and legal system:
Security, lack of proper and secure payment structures, legal issues:
a clear fix on contracts and liabilities in the digital economy, and trust and
assurance are the main concerns.

1.8 BUSINESS MODELS FOR E-COMMERCE

1.8.1 BUSINESS MODELS

A business model is the method of doing business by which a
company can sustain itself, that is , to generate revenue. The business

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model spells out how a company makes money by specifying where it is

positioned in the value of chain.
Some models are quite simple. A company produces goods or
services and sells it to customers. If all goes well, the revenues from sales
exceed the cost of operation and the company realizes profit. Other
models can be more intricately woven. Radio and television broadcasting
is a good example. The broadcaster is part of a complex network of
distributors, content creators, advertisers, and listeners or viewers. It is
not always clear at the outset. The bottom lines depends on many
competing factors. The marketing strategy of the company is needed
to assess the commercial viability of a business model and to answer
questions like the following:
• How is competitive advantage being built?
• What is the positioning?
• What is the marketing mix?
• Which product-market strategy is followed?
E-commerce can be defined as any form of business transaction in which
the parties interact electronically. A transaction in an electronic market
represents a number of interactions between parties. It could involves
several trading steps, such as
• Marketing
• Ordering
• Payment
• Support for delivery.
An electronic market allows the participating sellers and buyers to
exchange goods and services with the aids of information technology.
Electronic markets have three main functions such as :
• Matching buyers and sellers.
• Facilitating commercial transaction.
• Providing legal infrastructure.

Information technology permeates all three functions and also helps

to increase market efficiency and reduce transaction costs. The

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interaction between participants is supported by electronic trade

processes that are basically search, valuation, payment and settlement,
logistics, and authentication. The internet and the World Wide Web allow
companies to efficiently implement these key trading processes. For
instance, many search services and brokers are available to help buyers
find information, products, and merchants in electronic markets.

Represent of an electronic commerce

E-commerce can be formally defined as technology-mediated
exchange between parties (individuals, organizations, or both) as well as
the electronically-based intra- or inter-organizational activities that
facilitate such exchanges. It is global. It favours intangible things are
ideas, information and relationships, these three attributes produce a new
type of marketplace and society.
The effectiveness of an e-commerce website is measured through
the various parameters that constitute the web usage analysis for e-
commerce. The web channel provides new opportunities and challenges
for analysis. It collects a large amount of detailed information on every
user action. There is little knowledge of the end-to-end process from
identifying what usage analysis is interesting to an organization.
Although there are many different ways to categorize e-business models,
they can be broadly classified as follows:
1. E-business model based on the relationship of transaction parties.
2. E-business model based on the relationship of transaction types.
3. Classification by revenue model. A revenue model may comprise:
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a) Product sales model that charges customers directly for the product
or services they buy
b) Subscription model that charges a fixed monthly or annual rental for
the service.
c) Transaction fee model that charges a service fee based on volume
and value of the transactions offered; advertising support model that
charges advertisers of changing users; and sponsorship model that
provides sponsorship by companies for non-financial reasons.
4. Classification by distribution channel. A distribution channel may
comprise:
a. Direct marketing where manufacturers such as Dell, Nike, Lego or
sony market directly from company sites to individual customers
b. Pure play e-tailors who have no physical stores, only an online sales
presence.
c. Click-and-mortar retailers who are traditional retailers with a
supplementary website.
A business model can be defined as architecture for product, service, and
information flow including a description of business players, their roles
and revenue sources. For example, some of the most popular revenue-
generating models adopted by companies are:
i) Charge fee for advertising.
ii) Sell goods and services
iii) Sell digital contents
iv) Charge for processing the transactions that occur between two
parties on the web.
E-commerce models can be perceived in the form of relationship between
two entities such as:
• Direct marketing versus indirect marketing.
• Fully cyber marketing versus partial cyber marketing.
• Electronic distributor versus electronic broker.
• Electronic store versus shopping mall.
• Generalized e-malls versus shopping e-malls.
• Proactive versus strategic cyber marketing.

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• Global versus regional marketing.

• Sales versus customer service.

1.9 E-BUSINESS MODELS BASED ON THE RELATIONSHIP OF

TRANSACTION PARTIES

Electronic markets are emerging in various fields. Different

industries have markets with different charecteristics. The former
represents companies that sell digital information goods, such as news,
articles, music, books or digital videos. In the information B2C market, the
electronic infrastructure not only helps match customers and sellers, but
also acts as the distribution channel, delivering products to customers. In
this case, the infrastructure, such as server and networks must support
the delivery of large files, streaming media and other types of digital
goods in an efficient way.
This B2C market over the internet can be viewed as an open
system, where the number of participants is unknown. In the automotive
B2B market, the product traded, such as parts and components of cars,

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have a high degree of specificity. The market infrastructure used is to be

mainly based on Electronic Data Interchange (EDI) over expensive VAN
services. EDI involves the exchange of standardized, structure information
between organizations, permitting direct communication between
computer systems. The B2B application is the strong integration of
different applications. Server, network, and software should provide the
infrastructure to integrate web-based applications with mainframe and
legacy systems.
The nature of the market’s requirements is critical for creating the
underlying e-business infrastructure. The relation between B2B and B2C
models is clearly covers business transactions along the various
interactions existing in the value chain from producers of raw materials to
retailers and consumers including Manufacturers and distributors. B2C
reflects only the interactions between a customer and a retailer. Basically,
B2C transactions include the following steps:
i) Account acquisition
ii) Product discovery through search and browse
iii) Price negotiation
iv) Payment
v) Product delivery

Relationship between B2B and B2C model

E-commerce can be classified according to the transaction partners such
as

• Business-to-consumer (B2C)
• Business-to-government (B2G)
• Consumer-to-business (C2B)
• Consumer-to-consumer (C2C)

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E-business transaction model

a)Business - to – Consumer model:
B2C e-business models include virtual malls, which are websites
that host many online merchants. Virtual malls typically charge setup,
listing, or transaction fees to online merchants, and may include
transaction handling services and marketing options. Some of the reasons
for using B2C are:
1. Inexpensive costs, big opportunities:
Once on the internet, opportunities are immense as companies can
market their products to the whole world without much additional cost.
2. Globalization:
Even being in a small company, the web can make you appear to be a big
player which simply means that the playing field has been leveled by e-

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business. The Internet is accessed by millions of people around the world,

and definitely, they are all potential customers.
3. Reduced operational costs:
Selling through the web means cutting down on paper costs, customer
support costs, advertising costs, and order processing costs.
4. Customer convenience:
Searchable content, shopping carts, promotions and interactive and user-
friendly interfaces facilitate customer convenience, thus generating more
business. Customers can also see order status, delivery status, and get
their receipts online.
5. Knowledge Management:
Through database systems and information management, you can find
out who visited your sites, and how to create, better value for customers.

Process in B2C
b)Business-to-Business (B2B):

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B2B is that model of e-commerce whereby a company conducts its

trading and other commercial activity through the internet and the
customer is another business itself. This essentially means commercial
activity between companies through the internet as a medium.
This is supposed to be a huge opportunity area on the web.
Companies have by and large computerized all the operations worldwide
and now they need to go into the next stage by their customer and
vendors.
c)Major advantages of B2B:
1. Direct interaction with customers:
This is the greatest advantage of e-business. The unknown and faceless
customer including other businesses, buying the products of a large MNC
like HLL or Procter & Gamble through distributors, channels, shops and
this like now has a name, face, and a profile. Large MNCs pay a fortune for
this information on customer buying patterns.
2. Focused sales promotion:
This information gives authentic data about the likes, dislikes and
preferences of clients and thus helps the company bring out focused sales
promotion drives which are aimed at the right audience.
3. Building customer loyalty:
It has been observed that online customers can be more loyal than other
customers if they are made to feel special and their distinct identity is
recognized and their concerns about privacy are respected. It has also
been found that once the customers develop a binding relationship with a
site and its product.
4. Scalability:
It means that the web is open and offers round-the-clock access. It
provides an access never known before to the customer. This access is
across locations and time zones. Microsoft is using this model very
successfully. The additional cost of serving a larger segment of customers
comes down once in a critical mass is reached.

5. Saving in distribution costs:

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A company can make huge savings in distribution, logistical and after-

sales support costs by using e-business models. E-business models
involve the customer in the business interaction to such a level that
companies are able to avoid setting up the huge backbone of sales and
support force, which ordinarily would have to be set up.
d)Business-to-Business Transactions and Models:
B2B interactions involve much more complexity than B2C, typically
B2B transactions include, among others the following steps:
i) Review catalogues
ii) Identify specifications
iii) Define requirements
iv) Post request for proposals (REP)
v) Review vendor repetition
vi) Select vendor
vii) Fill out purchase orders (po).
viii) Send PO to vendor
ix) Prepare invoice
x) Make payment
xi) Arrange shipment
xii) Organize product inspection and reception.

Business – to – business Market place

Consumer-to-Consumer (C2C):

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With the C2C e-business model, consumers sell directly to other

consumers via online classified ads and auctions, or by selling personal
services or expertise online.

There are also a number of new consumer-to-consumer expert

information exchanges that are expected to generate $6 billion in revenue
by 2005. Some of these exchange as [Link] and abuzz and free and
some allow their experts ot negotiate fees with clients. It provides bills the
person’s credit card, delivers the answer and takes a 20 per cent
commission.
e)Consumer-to-Business (C2B):
The C2B model, also called a reverse auction or demand collection
model, enables buyers to name their own price, often binding, for a
specific goods or services generating demand. The website collects the
“demand bids” and offers the bids to the participating Sellers.
[Link] (travel, autos, consumer electronics) and

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[Link] (travel, telephone, mortgages) are examples of C2B e-

business models.

1.10 E-BUSINESS MODELS BASED ON THE RELATIONSHIP OF

TRANSACTION TYPES

This business model is essentially ruled by the following two

parameters:
1) On the basis of Value addition:
Value addition is the addition of value to a product or service because of
the opportunities that it offers on the web.
2) On the basis of control:
At the high end of control there is hierarchical control and at the low end
there is no control, so that it is self-organizing. Normally, the control is
done through the policies of the website.
Based on these, nine types of transactions can be identified as below:
• Brokerage
• Aggregator
• Info - mediary
• Community
• Value chain
• Subscription
• Manufacturer
• Advertising
• Affiliate
These transaction types take place in a variety of ways. Moreover, any
given firm may combine one or two of these as part of its web business
strategy.
a)Brokerage Model:
The characteristics of the brokerage model are as follows:
• The price – discovery mechanism is its key – principle.
• It is a meeting point for sellers and buyers.
• Auctions and exchanges are the modes of transactions.
• It is a ‘Free Market’.

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• It consists of Global Network of Buyers and Sellers.

• It is a Virtual Market space enabled by the internet.
• It encompasses all types of organizations now

b)Advantages of the Brokerage Model:

Following are the advantages of the brokerage model:
• C2C trading
a) Allows buyers and sellers to trade directly bypassing intermediaries,
and
b) Reduces cost for both the parties.
• Global reach
• Trading convenience, which
a) Allows trading at all hours, and
b) Provides continually updated information.
• Sense of community through direct buyer and seller communication.
• Efficient access to information.
• Alleviation of the risks of anonymous trading.

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c)Brokerage - Price Discovery Mechanisms:

There are three kinds of price discovery mechanisms, which form
the basis for the brokerage model. They are:
1. Auction
2. Reverse Auction
3. Market exchange

E-bay model
d)Aggregators:
There are four types of aggregators such as the following:
1. Content aggregators:
They are among the first large-scale sites on the web and mostly
represent large publishing companies.
2. Mainstream aggregators:
These includes sites like yahoo providing a web directory and a search
engine, along with a bunch of attractive tools like e-mail addresses, home
pages, remainders and many others. The most attractive features of these
sites is that they have an ‘easy to remember’ on the web.

3. Event aggregators:

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These are sites that provide in-depth content and tools to the needs of a
particular group, which doubles as a clearly defined customer base.
4. Shopping aggregators:
It let consumers roam through hundreds of sites and catalogues and find
the best price in seconds. They help consumers gift through dozens of e-
commerce sites.
e)Info-mediatory:

Info-mediatory
Buyer-based revenue sources are relatively rare but can be
expected increase over the next few years as info-mediary services
become valued in online shopping environments. Such sources could
include membership or subscription fees, allowing access to valued
information or services, a transactional percentage, or fees based on
services, such as connecting a seller to a buyer and ensuring privacy
protection. An info-mediary front end to the web could help protect
consumers from unsolicited mailings and confusing product selection.
f)Community:
• Social capital:
It provides the most popular platform for expression and discussion that
allows exchange of thoughts and opinions. Sulekha had helped raised over
$1 million/rs.5 crores for hundreds of cultural and charitable organizations
by promoting and selling tickets for their funds and events.

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• Economic capital:
Sulekha runs one of the most popular online classifieds services
worldwide, which allows for the exchange of products and services among
Indians.
• Political capital:
Sulekha provides a powerful platform for Indian organizations worldwide
to promote and find support for petitions advocating their causes.
g)Value Chain Model:
Value Chain moves businesses away from discrete streams of data
about the product being made to one unified pool of information that even
extends outside the company to suppliers and customers. The goal is to
develop full and seamless among all members of the chain, resulting in
lower inventories, higher customer satisfaction and shorter time to the
market.
h)Subscription Model:
Users are charged a periodic such as daily, monthly, or annual fee to
subscribe to a service. It is not uncommon for sites to combine free
content with “premium” (i.e. subscriber or member-only) content.
Subscription fees are incurred irrespective of actual usage rates.
Subscription and advertising models are frequently combined.
1. Content Service: It provides text, audio or video content to users
who subscribe for a fee to gain access to the service.
2. Person-to-person Networking Services: It is the distribution of user-
submitted information, such as individual searching for former
schoolmate.
3. Trust Services: It is in the form of membership associations that
abide by an explicit code of conduct, and in which members pay a
subscription fee.
4. Internet Service Providers: If offer network connectivity and related
services on a monthly subscription. Some popular topics of subscription
model are:
a. Existing newsletter topics.
b. Trade associations.

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UNIT-II

2.1 ENABLING TECHNOLOGIES OF THE WORLD WIDE WEB

2.1.1 WORLD WIDE WEB

The World Wide Web is a global information medium which users
can read and write via computers connected to the Internet. The term is
often mistakenly used as a synonym for the Internet itself, but the Web is
a service that operates over the Internet, just as e-mail also does. The
World Wide Web (abbreviated as WWW or W3,[1] commonly known as the
Web) is a system of interlinked hypertext documents that are accessed
via the Internet. With a web browser, one can view web pages that may
contain text, images, videos, and other multimedia and navigate between
them via hyperlinks.
Tim Berners-Lee, a British computer scientist and former CERN
employee,is considered the inventor of the Web. On March 12, 1989.
The terms Internet and World Wide Web are often used without much
distinction. However, the two things are not the same. The Internet is a
global system of interconnected computer networks. In contrast, the
World Wide Web is one of the services transferred over these networks. It
is a collection of text documents and other resources, linked by hyperlinks
and URLs, usually accessed by web browsers from web servers.
Viewing a web page on the World Wide Web normally begins either
by typing the URL of the page into a web browser, or by following a
hyperlink to that page or resource. The web browser then initiates a series
of background communication messages to fetch and display the
requested page.
The following example demonstrates the functioning of web browser when
accessing a page at the URL [Link]
The browser resolves the server name of the URL ([Link]) into an

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Internet Protocol address using the globally distributed Domain Name

System (DNS). This lookup returns an IP address such as [Link]. The
browser then requests the resource by sending an HTTP request across
the Internet to the computer at that address. It requests service from a
specific TCP port number that is well known for the HTTP service, so that
the receiving host can distinguish an HTTP request from other network
protocols it may be servicing. The HTTP protocol normally uses port
number 80. The content of the HTTP request can be as simple as two lines
of text:
GET /wiki/World_Wide_Web HTTP/1.1
Host: [Link]
The computer receiving the HTTP request delivers it to web server
software listening for requests on port 80. If the web server can fulfill the
request it sends an HTTP response back to the browser indicating success:
HTTP/1.0 200 OK
Content-Type: text/html; charset=UTF-8
followed by the content of the requested page. The Hypertext Markup
Language for a basic web page looks like <html> <head>
<title>[Link] – The World Wide Web</title> </head> <body>
<p>The World Wide Web, abbreviated as WWW and commonly
known ...</p> </body> </html>
The web browser parses the HTML and interprets the markup (<title>,
<p> for paragraph, and such) that surrounds the words to format the text
on the screen. Many web pages use HTML to reference the URLs of other
resources such as images, other embedded media, scripts that affect
page behavior, and Cascading Style Sheets that affect page layout. The
browser makes additional HTTP requests to the web server for these other
Internet media types. As it receives their content from the web server, the
browser progressively renders the page onto the screen as specified by its
HTML and these additional resources.

2.2 INTERNET CLIENT-SERVER APPLICATIONS

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The client–server model of computing is a distributed application

structure that partitions tasks or workloads between the providers of a
resource or service, called servers, and service requesters, called clients.
[Often clients and servers communicate over a computer network on
separate hardware, but both client and server may reside in the same
system. A server host runs one or more server programs which share their
resources with clients. A client does not share any of its resources, but
requests a server's content or service function. Clients therefore initiate
communication sessions with servers which await incoming requests.
Examples of computer applications that use the client–server model are
Email, network printing, and the World Wide Web
a) Client and server roles
The client–server characteristic describes the relationship of
cooperating programs in an application. The server component provides a
function or service to one or many clients, which initiate requests for such
services.
Servers are classified by the services they provide. For instance, a web
server serves web pages and a file server serves computer files. A shared
resource may be any of the server computer's software and electronic
components, from programs and data to processors and storage devices.
The sharing of resources of a server constitutes a service.
Whether a computer is a client, a server, or both, is determined by
the nature of the application that requires the service functions. For
example, a single computer can run web server and file server software at
the same time to serve different data to clients making different kinds of
requests. Client software can also communicate with server software
within the same computer. Communication between servers, such as to
synchronize data, is sometimes called inter-server or server-to-server
communication.
b) Client and Server communication
Clients and servers exchange messages in a request-response
messaging pattern: The client sends a request, and the server returns a
response. This exchange of messages is an example of inter-process

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communication. To communicate, the computers must have a common

language, and they must follow rules so that both the client and the
server know what to expect. The language and rules of communication
are defined in a communications protocol. All client-server protocols
operate in the application layer. The application-layer protocol defines the
basic patterns of the dialogue. To formalize the data exchange even
further, the server may implement an API (such as a web service).The API
is an abstraction layer for such resources as databases and custom
software. By restricting communication to a specific content format, it
facilitates parsing. By abstracting access, it facilitates cross-platform data
exchange.
A server may receive requests from many different clients in a very
short period of time. Because the computer can perform a limited number
of tasks at any moment, it relies on a scheduling system to prioritize
incoming requests from clients in order to accommodate them all in turn.
To prevent abuse and maximize uptime, the server's software limits how a
client can use the server's resources. Even so, a server is not immune
from abuse. A denial of service attack exploits a server's obligation to
process requests by bombarding it with requests incessantly. This inhibits
the server's ability to responding to legitimate requests.

2.3 NETWORKS AND INTERNETS

a) Networks
Since the 1970s, computer communication has changed from an
esoteric research topic to an essential part of the infrastructure.
Networking is used in every aspect of business, including advertising,
production, shipping, planning, billing, and accounting.
The growth and uses of the global Internet† are among the most
interesting and exciting phenomena in networking. In 1980, the Internet
was a research project that involved a few dozen sites. Today, the Internet
has grown into a production communication system that reaches all
populated countries of the world. Many users have high speed. Internet
access through cable modems, DSL, or wireless technologies.

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b) The Five Key Aspects Of Networking

To master the complexity in networking, it is important to gain a
broad background that includes five key aspects of the subject:
• Network Applications And Network Programming
• Data Communications
• Packet Switching And Networking Technologies
• Internetworking With TCP/I
• Additional Networking Concepts And Technologies
c) Internets
Internets", also known as "The Internets", is a Bushism-turned-
catchphrase used humorously to portray the speaker as ignorant about
the Internet or about technology in general, or as having a provincial or
folksy attitude toward technology. Former United States President George
W. Bush first used the word publicly during the 2000 election campaign.
The term gained cachet as an Internet humor meme following Bush's use
of the term in the second 2004 presidential election debate on October 8,
2004.
The Internet is a global system of interconnected computer
networks that use the standard Internet protocol suite (TCP/IP) to link
several billion devices worldwide. It is an international network of
networks that consists of millions of private, public, academic, business,
and government packet switched networks, linked by a broad array of
electronic, wireless, and optical networking technologies. The Internet
carries an extensive range of information resources and services, such as
the inter-linked hypertext documents and applications of the World Wide
Web (WWW), the infrastructure to support email, and peer-to-peer
networks for file sharing and telephony.

2.4 SOFTWARE AGENTS INTERNET STANDARD AND SPECIFICATION

In computer science, a software agent is a computer program that

acts for a user or other program in a relationship of agency, which derives
from the Latin agere (to do): an agreement to act on one's behalf. Such

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"action on behalf of" implies the authority to decide which, if any, action is
appropriate.
Related and derived concepts include intelligent agents (in
particular exhibiting some aspect of artificial intelligence, such as learning
and reasoning), autonomous agents (capable of modifying the way in
which they achieve their objectives), distributed agents (being executed
on physically distinct computers), multi-agent systems (distributed agents
that do not have the capabilities to achieve an objective alone and thus
must communicate), and mobile agents (agents that can relocate their
execution onto different processors).
The term "agent" describes a software abstraction, an idea, or a
concept, similar to OOP terms such as methods, functions, and objects.
The concept of an agent provides a convenient and powerful way to
describe a complex software entity that is capable of acting with a certain
degree of autonomy in order to accomplish tasks on behalf of its host. But
unlike objects, which are defined in terms of methods and attributes, an
agent is defined in terms of its behavior.
In computer network engineering, an Internet Standard (abbreviated
as "STD") is a normative specification of a technology or methodology
applicable to the Internet. Internet Standards are created and published
by the Internet Engineering Task Force (IETF).
a)Specification process
Becoming a standard is a two step process within the IETF called
Proposed Standards and Internet Standards. If an RFC is part of a proposal
that is on the Standard Track, then at the first stage, the standard is
proposed and subsequently organizations decide whether to implement
this Proposed Standard. After the criteria in RFC 6410 is met (two
separate implementations, widespread use, no errata etc.), the RFC can
advance to Internet Standard.
b)Proposed Standard
A Proposed Standard (PS) is generally stable, has resolved known
design choices, is believed to be well-understood, has received significant
community review, and appears to enjoy enough community interest to

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be considered valuable. However, further experience might result in a

change or even retraction of the specification before it advances. Usually,
neither implementation nor operational experience is required.
c)Internet Standard
An Internet Standard is characterized by a high degree of technical
maturity and by a generally held belief that the specified protocol or
service provides significant benefit to the Internet community. Generally
Internet Standards cover interoperability of systems on the Internet
through defining protocols, message formats, schemas, and languages.
The most fundamental of the Internet Standards are the ones defining the
Internet Protocol.
An Internet Standard ensures that hardware and software produced
by different vendors can work together. Having a standard makes it much
easier to develop software and hardware that link different networks
because software and hardware can be developed one layer at a time.
Normally, the standards used in data communication are called protocols.
All Internet Standards are given a number in the STD series - The first
document in this series, STD 1, describes the remaining documents in the
series, and has a list of Proposed Standards.

2.5 ISP

An Internet service provider (ISP) is an organization that provides

services for accessing, using, or participating in the Internet. Internet
service providers may be organized in various forms, such as commercial,
community-owned, non-profit, or otherwise privately owned.

a)INTERNET Service Providers :

• Have WW's entry points (NEP) or Point of Presence (POP) through
which users get connected to internet.
• The user may wish to connect to only on PC with a few terminals or
with a LAN and WAN.
• ISP - Provides connection of various types & speeds.
b)INTERNET CONNECTION :

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The internet connection flow within the following categories.

i) Dedicated Connection :
A Least telephone line at 56kbps or 64kbps or T link at 1.544 mega
bytes connects the get way computer are router of a WAN or LAN.
c)On Demand Connection :
The user has to dial up to the higher speed using a modem or an
ISDN
d)Dial up Account :
Single user with PC connects to the ISP's Computer. The modems
used are X modem, Z modem or Kermit.
e)Serial Line Internet Protocol ( SLIP ): or Point to Point A/c ( PP A/c )
i) It is more like on demand type of connection for single user
PC.
ii) All the client application can run directly from the PC.
f)Part Time Hold Connection :
i) Based on unix to unix copy protocol ( UUCP )
ii) An user organization may dial an ISP’s at periodic intervals
and transfers its mail etc.,
iii) Single UUCP connection enables an organization to save several
mail users.
g)INTERNET Communication Protocol :
i) An communication protocol allows difference kinds of
computers using different operating system with communicate with one
another
ii) A user connected on any network on the internet can
communicate with people or software located on anyother network
connected to the internet using the protocol TCP / IP. Unix system
develops the UUCP protocol to network themselves into an network called
UUCP net. The UUCP is a point to point protocol design for communicating
over telephone and serial lines.
UUCP user for transporting e-mail between computer than
don’t have TCP/IP.
h)Internet Services and Resources :

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i) There are innumerable information resources located on any

number of serves on the internet.
ii) The internet community has developed new ways of
communicating in the internet space or cyber space which are more user
friendly.
iii) The internet service are boardly classified into two categories.
i) Communicating in the cyberspace.
ii) Locating and returning information.
i)INTERNET MAIL :
i) Electronic mail is oldest service on the internet and still most
dominant.
ii) It enables one to send information in the form of letters,
messages, advertisement, spread sheets, game programs, binary files and
multimedia data files.
iii) E-mail on the internet in expensive volume independent and
distance independent.
E-mail software comprises mail serves on the internet and the mail
user agent at the user end. The mail servers based on various protocol.
Simple mail transfer protocol ( SMTP ) (ie) unix to unix Copy protocol
( UUCP)
Post office protocol (POP)
A mail user agent software running on a PC or terminal is used to
compose and send mail through a server retrieve mail from a server and
display the same on the users screen. It also performance a variety of
functions such as submit or receive messages, retain or remove after
fetch, resend, spell check, single to inform the arrival of new messages,
folder facility, attach or detach, system address book, sort, delete, filter,
print etc.,
The Internet mail user agent may also use Pop. The mail user agent
can also process attached files using the multipurpose internet mail
extension protocol ( MIME )
There are other ways for communicating on the internet.

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i) User net news : It is similar to a electronic bulletin board. Each

dedicated to a specific topic and shared by 1000 of uses. These bulletin
boards are refer to as news groups which are classified into various
classes. Such as business, science, magazines, health, computers etc.,
ii) There are over 10,000 news groups carried by major ISP’s
iii) Any one can post an message on it are moderated - some one
running a news group is recurred to approve a message before posting it
on a electronic bulletin board.
iv) There is no Central administration of use net. It is run by
people who use it.
j)Mailing Lists :
i) The use net group is open to all but if the internet is confined
to a smaller domain. A mailing list may be used.
ii) Discation groups are announcement of specific nature
generally used mailing list. A discation groups of members restricted to
only subscribers as per the mailing list, receive messages from the server
as soon as some one has sent one.
k)Internet Relay Chat :
i) The IRC service in internet differs from use net. In that, chat or
discussion takes place in real time. It is the very popular service with the
multiuser implementation with the UNIX. “Top Program”.
ii) The IRC network on the internet consist of multiple
interconnected on the serves.
iii) The IRC service comprises a number of channels public,
private, secret, invisible. A user can choose the channel of his choice and
be part of a particular conference on the internet.
This is run by a software program known as IRC Client. The IRC
allows a user to change from one group to another on chat group to
another join any conversation are listen only.
l)Internet Talking :
i) This internet light audio or video service allows a user
Computer to connect to other user computer on the internet.

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ii) The messages are exchanged in real time and a program

executing in the background called the talk daemon handles the actual
communication service.
iii) This program should be compatable between user deciding to
encatch in internet chat video exchange is conducted in real time over a
internet which included software packages light line com and VDO Phone.
m)Internet Search :
An internet is an a enormous source of information. Locating and
retrieving information are the key problems. The search tools are
essential to do this task. The tools of the internet are divided as follows.
• Telnet rlogin rsh
• File transfer protocol ( FTP ) Archive.
• Hopher and Veronica.
• Wide Area Information service ( WAIS )
• Hyper text Transfer Protocol ( HTTP )
• WHOIS
• World Wide Web ( WWW )
n)Telnet :
i) It is very popular internet service which enables a user to log
into another computer to run as software there.
ii) Telnet is a program to allows a computer to establish a
session with a remote cost on the internet.
iii) Many public services can be accesses using telnet and also
the database on the service. Once log on to the server he can execute
various commands to operate the host system such as ‘rlogin’ & ‘rsh’.
o)File Transfer Protocol ( FTP ) :
i) FTP is the tool that is used to transfer files among computers
on the internet.
ii) FTP is a set of specification a program which enables one to
login on a remote computer in order to send files to it and receive files
from it.
iii) The files may be of anytype text, graphics multimedia or
binary files.

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iv) The FTP is a collection of programs which includes both client

and server software.

2.6 E-MARKETING

E-Marketing can include any internet-based promotion, including

website, targeted e-mail, Internet bulletin boards, site where customers
can dial-in and download files, and so on. The term does not have a strict
meaning though, and many marketing managers use it use it to describe
any computer-based marketing tool.

2.6.1 TRADITIONAL MARKETING

If marketing is whatever you do to promote the sale of your
products or services, then it should include:
1. Marketing research – from competitive information- gathering to
industry awareness to soliciting customer opinions and preferences.
2. Publicity from press releases to the positioning of your company and
its offerings in the marketplace
3. Advertising that is text-based (classifieds) and graphic-based
(display)
4. Sales, including distribution and merchandising
5. Customer service and customer support.
Traditional marketing seems to fall far short of three features. There are
certain problems associated with it, which can be listed as follows:
1. Traditional marketing id often expensive. It can cost a lot of money
to produce and print brochures, product sheets , and catalogues. It is also
expensive to keep support personnel on hand to answer inquiries from
customers, and it costs a lot of money in postage and shipping fees to
send information to prospective customers.
2. Traditional marketing can be a very time-consuming process.
Mistakes have to be corrected: you have to go back to the ad agency or
printer to revise, add or delete.
3. Traditional marketing often has a “hit and miss” quality. Marketers
often send out bulk of mails to customers and yet receive a tiny response.

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Moreover they feel that they do not cater to the taste of the consumers or
rather that they do not come across the right consumer.
Business have always made their presence felt by establishing shops,
factories, warehouses, and office buildings. An organization’s presence is
the public image it presents to its stakeholders. The stakeholders of a firm
include its customers, suppliers, employees, stockholders, neighbors, and
the general public.

2.6.2 IDENTIFYING WEB PRESENCE GOALS

On the Web, business and other organizations have the advantage
of creating a space of their own choice, design and other embellishment,
good enough to make a distinctive presence. A website can have images,
and can activated them by animation, thus making the customers feel and
enjoy its presence.
These Web presence project the image of each of these companies. Each
presence is consistent with other elements of the marketing efforts of
these companies.

a)Achieving Web Presence Goals

An effective site is the one that creates an attractive presence that
meets the objectives of the business or the organization. These objectives
include:
1. Attracting visitors to the website
2. Making the site interesting enough so that visitors stay and explore
3. Convincing visitors to follow the site’s link to obtain information
4. Creating an impression consistent with the organization’s desired
images
5. Building a trusting relationship with visitors
6. Reinforcing positive images that the visitor might already have
about the organization
7. Encouraging visitors to return to the site.

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b)The Uniqueness of the web:

The failure to understand how the web is different from other
presence building media is one reason why so many business fail to
achieve their web objectives. The scenario has changed for the better in
the recent times with the prominence of Internet technologies over others.
Now, most of the websites that are designed to create an organizations
presence in the web medium include links to a fairly standard information
set. The site give visitors easy access to its history, statements about its
objectives or mission, information about products or services offer,
financial information and means of communication with the organization.
c)Meeting the needs of website Visitors:

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People visit a website seldom arrive at it by accident; they are at it

for a special reason. The web designer who makes a site useful for
everyone, needs to keep in mind some of the possible reasons listed as
follows.
Learning about products or services that the company offers. Buying the
products or services that the company offers. Obtaining information about
warranties or service and repair policies for products they have
purchased. Obtaining general information about the company or
organization. Obtaining financial information for making an investment or
credit-granting decision.
Identifying the people who manages the company or organization.
Obtaining contact information of a person or a department in the
organization offers support, and gains their confidence so the they return
to it again. Thus the customer value is upheld.

d)Site Adhesion: Content , Format and Access:

i)Content
A customer accesses a website for the content of that site. Initially a
customer will want navigate quickly to gain a clear understanding of the
site’s progression to more detailed information.
ii)Format
The format of an organization’s site is important with respect to the
customer’s technical sophistication. Vendors need to create a balance
between information provision and information delivery speed.
iii)Access

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Online data access depends on the bandwidth requirement. The

clear rule in the initial interaction phase is to use as minimal a bandwidth
as is feasible to facilitate as wide an audience as possible.
iv)Maintaining a Website
Creating a website that meets the needs of visitors with such a wide
range of motivation can be challenging. The website visitors will be
connected to the internet through a variety of communication channels
that provide different bandwidths and data transmission speeds.
A good site design lets visitors choose among information attributes
such as level of details, formats of aggregation, viewing format and
downloading format. Websites can also offer visitors, multiple information
formats by including links to files in those formats.
For example , the page offering financial information could include links to
an HTML file, an Adobe PDF file, and an Excel spreadsheet file.
v)Metrics Defining Internet Units of Measurement
The e-commerce world has, since inception been attempting to measure
parameters associated with the Web and websites in order to asses two
things:
1. Advertising : How many people saw our banner ad?
2. Visitation – How many people came to our site?

2.7 ONLINE MARKETING

Marketing is a societal process, which discerns consumer’s wants,

focusing on a product or service to fulfil those wants, attempting to
mould the consumers toward the products or services offered. Indeed,
marketing is fundamental to any businesses growth. The marketing teams
(marketers) are tasked to create consumer awareness of the products or
services through marketing techniques. Unless it pays due attention to its
products and services and consumers' demographics and desires, a
business will not usually prosper over time.
Online communication today is not only confined to the computer,
and so marketing can be provided to the end-user in more ways than via

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the computer. This paper will not distinguish between different ways of
accessing the Internet. A website can be designed to appear best on a
smaller screen (cellular phone), or chat can via the Internet go from
computer to regular phone, even with one end typing in text and the
other end speaking. Online marketing will therefore be used in the
broadest term possible, only where necessary will the definition be stated
and discussed.
There are three new market segments which are as follows:
a. Cyberbuyers:
While "cyberbanking" and "cybercommerce" offer great convenience, they
can be sources of concerns for consumers. The FDIC is aware of a few
problems and pitfalls in particular, including:
• Companies pretending to be banks offering unusually high interest
rates on deposits that, in reality, are not banks and are not insured by the
FDIC;
• Thieves using sophisticated computer programs to obtain sensitive
information, such as credit card or Social Security numbers, when
consumers pay for purchases over the Internet or send e-mail to friends;
b. Cyberconsumers
These are the home computer users wired up to commercial online
services and the Internet. This group represents the pot of gold, and
marketers simply need to find ways to make it more attractive to shop
and buy online than to go the local store.

c. Cybersurfers:
They use online technology to expand their horizons, challenge their
abilities, and for fun. This segment is typically younger, and possesses
shorter attention [Link] of the important aspects of marketing are
advertising, sales, security of the transactions and the mode of payment
used for payments. And all of these have had to adapt and change
themselves according to the demands of the Internet.

d. Advantages of Online Marketing:

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i)Measurability:
By E-mail marketing, you can easily find the number of E-mails sent,
number of E-mails that have been opened and that those who have
opened up, the number of people who are not registered, and click rate
(which includes the link been effective and who clicked on it). It is easy.
Creating a marketing message via E-mail is almost as easy as writing an
E-mail . It is automatic.
E-mail marketing has a tool called an “autoresponder”. For example,
if you want to send a campaign message to your recipient its on special
days you just create the messages and schedule it . It is fast and efficient.
Timing is everything, so it can be said: this is a quick and efficient way.
Offers promotions through E-mail with a clear call to action, can have
tremendous impact on earnings. Channels cannot provide any possibility
for you in a short period of time so as to obtain the customer directly .
E-mail marketing is known as a permission marketing and it is one
of it’s advantages because it allows customers to decide whether they
want to be reached via E-mail . Mass customization are enabled by E-mail
marketing so each message is unique to each customer, it helps
marketers to inform the success of their promotions easily and quickly, it
provides a major insights into the recipient’s actions through measurable
events such as message open.
ii)Various businesses that can flourish on the Internet
• Banking
• Databanks
• Retailing

2.8 E-ADVERTISING

Electronic advertising is an attempt to release information on the

Internet in order to establish a relationship among vendors and buyers.
Internet advertising can also aim at strengthening the position of a
specific brand in the market (brand building) or attempt to evoke direct
response from consumers. This latter type of advertising has great
advantages compared with other advertising means, such as television or

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radio that do not support bi-directional communication and transactions.

Moreover, Internet advertising can be defined as every form of
commercial content, available through the Internet and designed by a
company, in order to inform consumers of a good or a service (Schlosser
et al, 1999). The most common way of advertising through the Internet is
the so-called "brochure ware", which refers to the use of a company's
official website to show its products and business activities.
• The new age of information-based marketing.
• Advertising on the internet.
• Marketing research.
a)Advertising on the Internet
The notion of advertising and marketing became inevitable after
1991 when the internet was opened for commercial traffic.
There are very good reasons for embracing the inevitability of growing of
commercial advertising on the internet:
• Advertising conveys much needed information
• Advertising generates significant revenue
Key components for making internet advertising effectively are:
• Advertising process
• Core content
• Supporting content
• Market and consumer research
• Repeat customers

b)On-line advertising paradigms:

Two different advertising paradigms are emerging in the on-line world,
they are:
1. Active or push-based advertising
2. Passive or pull-based advertising
c)Active or push-based advertising:
Active or push-based advertising is of two types they are :
d)The broadcast model:

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Broadcasting message provides a means for reaching a great

number of people in short period of time. It mimics the traditional model,
in which customer id exposed to the advertisement during TV
programming. It basically uses direct mail, spot television, cable
television. Text-based broadcast messages also used in advertising in
Usenet news groups.
e)The junk mail model:
Disadvantage of the direct mail include relatively high cost per
contact. Junk mail is the just poorly targeted direct mail. It is most
intrusive of all forms of internet advertising, because it is easily
implemented using electronic mail. Junk mail creates unwanted expense
as well as an annoyance.
Passive or pull-based advertising . Pull-based advertising provide a
feedback loop, company and customers. On-line pull-based advertising
includes the following:
Billboards Catalogs or yellow pages directories: endorsements
f)Based on the above three we have the fallowing mode ls:
The billboards or www model: Billboard advertising is often used to
remind the customer of the advertising messages communicated through
other media.
The advantage of this model is no customer charges. In this message
must be simple, direct.
g)Catalog and yellow pages directory model:
Traditionally, the most visible directory service of advertising is the
yellow pages. Catalog model is the least intrusive model but requires
active search on the part of customer. Yellow pages are low in cost in
terms of production and placement.
Disadvantage of yellow page include lack of timeliness and little creative
flexibility.
Customer endorsement model: In endorsements people tell their
experiences with products and services. These are in question and answer
format. Marketing
h)Various means of Advertising:

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• E-mail
• Banners
• Skyscrapers
• Banner Swapping
• Streaming Video and Audio
• Effectiveness tracking
• Mini-sites, Pop-ups
i)Personalized Online Communications:
Online companies have the opportunity to reduce mass-marketing
expenses and increase response retaes by developing marketing
strategies that center around individual customer. We categorise
personalized marketing in to five primary forms as follows:
1. Permission Marketing
2. Personalized recommendations
3. Personalized advertisements
4. Personalized Web pages
5. Personalized e-commerece stores

j)Conducting online market research:

Research Market research is extremely important for companies in
terms of how they allocate their advertising dollars in sales promotions,
how they introduce new products, how they target new markets.
Broadly marketing research is divided into three faces:
• Data collection Data organization
• Data analysis and sense making
• Data collection:

Markets mainly relied on source database for understanding

consumer behavior. Source data base mainly comprise of numeric
information. Delivery of source database services fallows two main
patterns. Data collect and collate data, making it available by data base
producers. Data collect and collate data, making it available by central
hosts like CompuServe, American online..etc.

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k)Data organization:
Everyone is collecting data from electronic commerce, but very few
are organizing it effectively for developing a marketing strategy. The key
abilities in their environment are:
Leverage its established database into customized offerings by audience
and markets. Leverage its established database in terms of horizontal
growth.
l)Data analysis and sense making:
The ability to link database to analytic tools like econometric
programs and forecasting models is called data analysis. Market research
is undergoing major changes; the next generation of source database will
definitely include multimedia information.
m)Internet Marketing Trends:
Technology-enabled Relationship Management:

The steps involved in internet marketing techniques are:

1. Provider of information
If you are collecting contact information which includes or may include
personal data, certain information must be notified to the data subject:
• the identity of the data controller;
• the purpose(s) for which the data are intended to be processed; and

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• any further information which is necessary, having regard to the

specific circumstances in which the data are or are to be processed, to
enable processing in respect of the data subject to be fair.
The information should in general be given to data subjects or made
readily available to them at the point of collection. The most common way
to meet these requirements in the website context is through the use of
fair processing notices and privacy policies.
2. Site registered with search engines
Search engine is a tool for finding information, especially on the
Internet or World Wide Web. Search engines are essentially massive
databases that cover wide swaths of the Internet. Most consist of three
parts: at least one program, called a spider, crawler, or bot, which crawls
through the Internet gathering information; a database, which stores the
gathered information; and a search tool, with which users search through
the database by typing in keywords describing the information desired
(usually at a Web site dedicated to the search engine).
3. Specialized services to users requesting information
It is a source intended to provide the customer or end user with
information and support related to a companies or institution's products
and services. The purpose is usually to troubleshoot problems or provide
guidance about products such as computers, electronic equipment, food,
apparel, or software. Corporations usually provide help desk support to
their customers through various channels such as toll-free numbers,
websites, instant messaging, or email.
4. Specialized email to users requesting periodic information
A content provider publishes a feed link on their site which end
users can register with an aggregator program (also called a feed reader
or a news reader) running on their own machines; doing this is usually as
simple as dragging the link from the web browser to the aggregator.
When instructed, the aggregator asks all the servers in its feed list if they
have new content; if so, the aggregator either makes a note of the new
content or downloads it. Aggregators can be scheduled to check for new

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content periodically. Web feeds are an example of pull technology,

although they may appear to push content to the user.
5. Offline Advertising
Advertising a Web site and its URL in traditional media such as
radio, TV and magazines.
6. Banner Advertising
A web banner or banner ad is a form of advertising on the World
Wide Web delivered by an ad server. This form of online advertising
entails embedding an advertisement into a web page. It is intended to
attract traffic to a website by linking to the website of the advertiser. The
advertisement known as a "click through." In many cases, banners are
delivered by a central ad server.
7. Targeted Emails to Past Customers
Much of the email that consumers receive today is targeted to their
personal or lifestyle preferences. Of course there are still the wildcard
kinds of messages that everyone receives but those messages that are
based on either previous purchases or those identified in opt-in or double
opt-in subscriber methods have made it much easier for email marketing
professionals to cater to everyone on their lists.
8. Spam Mail
Spam is most often considered to be electronic junk mail or junk
newsgroup postings. Some people define spam even more generally as
any unsolicited email. However, if a long-lost brother finds your email
address and sends you a message, this could hardly be called spam, even
though it is unsolicited. Real spam is generally email advertising for some
product sent to a mailing list or newsgroup
9. Chain mail
Chain e-mails are those that, in the body or subject of the message,
ask the recipient to forward the e-mail on to multiple people. Many chain
letter e-mails are hoaxes and are often considered to be a security and
privacy risk. If the message is forwarded on by a person, it will usually
show the names and e-mail addresses of everyone you have sent it to,

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and possibly the addresses of everyone the last person (from which you
received it) also sent it to.
10. Advertising
The act or practice of calling public attention to one's product,
service, need, etc., especially by paid announcements in newspapers and
magazines, over radio or television, on billboards, etc.: to get more
customers by advertising.

2.9 E-BRANDING

In traditional markets, one of the major roles of a brand is to

substitute information in order to simplify consumer's time-consuming
process of search and comparison before a purchase decision. The
Internet makes search and comparison an easy and inexpensive task,
thus it threatens to eliminate the aforementioned role of the brand.
A typical Web transaction requires from the potential customer to
submit or to give access to detailed personal information. The latter gave
rise to a lot of discussion given both the concern of people when sharing
personal information and the outer risks involved with it. Although, certain
policies and directives have been enabled, the intangible and anarchic
nature of the Internet is still difficult to be ruled. Moreover, consumers buy
goods that, in most cases, they have never handled or seen before. All of
the above demonstrate the value of trust and security in the Internet. In
other words, customers tend to be loyal to those sellers whose transaction
scheme has been tested or is known and familiar to them.
E-brand awareness and e-brand image are defined next. E-brand
awareness describes the consumer's likelihood and ease with which
he/she associates a [Link] e-brand with a product category. Similarly,
an e-brand's image relates to consumer perceptions about a [Link] as
reflected by the associations linked to the [Link] in consumer's
memory . Industry analysis shows that reliability, personalization, velocity
and ease of navigation are critical factors in establishing a positive e-
brand image [29]. Equally important to the generation of positive

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perceptions for the e-brand image are consumers' sense of security and
privacy when accessing the [Link]
Element Meaning to the customer
Differentiation In what significant ways is this product
or service unlike its competitors
Relevance How does this product or service fit in
to my life?
Perceived value In this product or service good?
a)Sprial Branding:
Spiral branding puts the focus on the Internet as the core
technology that encourages the customer to give and receive information.
The enterprise then is expected to share this information across various
divisions and departments. The overall idea is that information is funneled
through the Net, integrated back into the legacy system and served back
to the customer in the form of information relevant to his interests, thus
fostering customer loyalty and enhancing the customer relationship.
Spiral branding in the organization, both to build and support the
brand, is the key to long-term success. But before this can happen, some
critical abilities must be in place, including: The ability to quantify the
value of the customer interaction. The analytic applications' reporting
solutions help to quantify the value of the customer interaction. The
metrics tracked and reported can help guide e-businesses with their
customer relationship management strategies. The ability to set
thresholds to trigger rules and events. The results of the calculations that
analytic applications provide can be used to set thresholds that trigger
specified business rules and events and, in turn, automate the delivery of
specific content (such as personalized offers and product
recommendations).
The ability to integrate data.
The problem with both the integrated marketing and spiral branding
theoretical concepts is they rely on overcoming problems. One of these
problems, data integration, is so significant that it minimizes all others.

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Data integration is the ability to integrate different data sets from multiple
legacy systems .

Despite the Internet and the popular thinking that the Net is dealing
with pristine data, the Net still depends on having access to data
throughout the enterprise. Because most information about a customer
has been stored in legacy systems for years, spiral branding - even
though it depends on the Internet for its delivery system - must rely on
historical information to work effectively.
Without quality integration, the final data do not produce good
results when put into a common customer database. The integrated data
sets may have inconsistent values or be lightly populated, and this can
result in the delivery of poor information about the nature of a consumer.
The keys to spiral branding are:
1. Use each media for its best purpose
2. Do it fast
3. Iterate constantly

b)Implement several key strategies:

Heightened focus on customers. Attention must be shifted from
attracting new customers to cultivating current customers and prospects.
More corporate resources should be spent on retaining the profitable
customers than on the unprofitable ones.
Well-defined customer relationship strategy. This increasingly
critical strategy will determine which customers the organization plans to
attract, retain and cultivate. It will also dictate what balance of technology
and process will be necessary to drive the customer relationship further.
Re-engineered internal processes to accommodate the new expectations
of the consumer. Systems must be developed that allow customers to
deliver feedback and the enterprise to remember that feedback and take
action. Enterprise wide systems must be reworked to eliminate internal
barriers that often obstruct customer relationship building activities, such
as information hoarding.

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UNIT-III

3.1 E-PAYMENT SYSTEMS

a)Introduction
The ease of purchasing and selling products over the Internet has
helped the growth of electronic commerce and electronic payments
services are a convenient and efficient way to do financial transactions.
Current e-payment technologies depend on using traditional methods that
are common to non-electronic systems. Due to the nature of Internet,
security and authenticity of payments and participants cannot be
guaranteed with technologies that are not specifically designed for
electronic commerce.
We need an e-payment system that would not only provide secure
payments but should also have properties like online customer and
merchant authentication, unforgeable proof of transaction authorization
by the customer both to the merchant and the bank, privacy of customer
and transaction data. This chapter provides an overview of e-payment
architecture and their functionalities, their requirements and verification
of payment protocols.
Entities
Electronic payments involve a payer and a payee. A payer (buyer or
customer), is an entity who makes a payment. A payee (seller or
merchant), is an entity who receives a payment. The main purpose of an
electronic payment protocols is to transfer monetary value from the payer
to the payee. The process also involves a financial institution (bank or
mint).
Typically, financial institution participates in payment protocols in
two roles: as an issuer (interacting with the payer) and as an acquirer
(interacting with the payee). The issuer is responsible for validating the

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payer during account registrations and holds the payer’s account and
assets. The acquirer holds the payee’s account and assets. The payee
deposits the payments received during a transaction with the acquirer.
The acquirer and the issuer then proceed to perform an inter-banking
transaction for clearance of funds. It is possible for the issuer and the
acquirer to be from the same financial institution.
Other parties that may be present in a payment protocol include a
Trustee (arbiter) who is an entity that is independent from all parties. All
entities in a protocol unconditionally trust the Trustee who is called to
adjudicate any disputes between the payer and the payee. Certain
payment systems might involve more players like payment Gateways (PG)
who are entities that act as a medium for transaction processing between
other entities (e.g. MasterCard, Visa) and Certification Authorities (CA)
who are necessary if the e-payment systems involve PKI’s. They issue
public key certificates to entities involved in a payment protocol so that
their authenticity can be publicly verified.

3.2 MAIN CONCERNS OF INTERNET BANKING SYSTEM

3.2.1 INTERNET PAYMENT SYSTEMS

Internet payment systems refer to the various methods by which
individuals and companies doing business online collect money from their
customers in exchange for the goods and services they provide. A number
of different forms of payment exist for online purchases, and more are
being developed all the time. After all, it is in the best interest of both

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consumers and merchants to make electronic commerce as safe and easy

as possible. "On the Internet, a small, one-man operation can look as good
or better than a large, multinational corporation. But whether it's an
individual working out of a virtual office, or a CEO sitting in an expensive
downtown office building, they're going online for one purpose to sell. And
they're leaving no stone unturned in their efforts to make it safe and easy
for their customers to buy. "
Customers who physically visit retail establishments can choose
among a variety of payment methods, including cash, checks, credit
cards, and debit cards. Customers who shop on the Internet are beginning
to expect online merchants to offer the same variety and convenience in
payment terms. Credit cards remain the most common form of payment
for online purchases, although the options have expanded to include
digital cash, smart cards, electronic checks, and other technologies.
In addition, some customers continue to make online purchases
using traditional payment methods, such as placing orders by telephone
or fax, or sending a check via snail mail. He claims that small businesses
can add value to their product or service offerings by making payment
easy, comfortable, and secure for their customers. It affecting online
payment systems from both the sellers' and the buyers' perspectives are
maintaining the security of financial information sent over the Internet. A
survey conducted by Visa showed that 91 percent of consumers were
concerned about privacy and security on the Internet. It means that they
intended to buy online but did not complete the transaction. "Concerns
about security and the perception that online credit card transactions are
extremely unsafe seem to be among the biggest issues keeping many
retailers and consumers from closing sales electronically.

3.2.2 ONLINE PAYMENT OPTIONS

a)Credit Cards
As of 2000, credit cards remained the most common means of
online payment. They were also among the easiest payment methods, for
consumers as well as for merchants. From the consumer's standpoint,
ordering merchandise from the Internet required only entering a credit

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card number and expiration date in the appropriate fields on a merchant's

Web site. Many consumers felt greater confidence in online transactions
when they used a credit card, knowing that a third party (the credit card
company or issuing bank) was involved and could help protect them
against fraud. In most cases, the consumer's liability for fraudulent credit
card charges is limited to $50.
For merchants who already accept credit cards offline, taking credit
card payments over the Internet is relatively simple. It basically involves
setting up two Web pages, one to promote the company and its products
or services, and the other to process order information. it can be difficult
for online retailers to establish the merchant accounts needed to begin
accepting credit cards. Many banks are reluctant to set up accounts for
online merchants because they deal with "card-not-present transactions,"
or transactions in which the physical credit card and holder's signature are
not used. The approval process for these accounts is usually quite
rigorous, and the fees on sales tend to be higher than those charged to
regular merchants. These high fees can pose a particular problem for
online merchants who sell small-ticket items.
Once a small business has established a merchant account with a
bank, It is also necessary to obtain card authorization software which can
be run on a computer network or a point-of-sale (POS) terminal to transmit
sale data to the payment processing firm via a modem and telephone line.
The processing firm checks the validity of the credit card number,
expiration date, and purchase amount, then provides the merchant with
an authorization number. The preferred method for handling online sales
is to pass the transaction information along to the payment processing
firm for authorization while the customer is still online. An e-mail
confirmation completes the transaction.
b)Smart Cards
Smart cards are similar to credit cards, except they store
information on an imbedded chip instead of on a magnetic strip on the
back. Consumers can load money into an account on the card by using an
automatic teller machine (ATM) or by placing the card in a slot in a

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specially equipped computer. The imbedded chip keeps track of how

much money is added to and withdrawn from the account. Smart cards
are already quite popular for online sales in some international markets.
They are eventually expected to combine the features of credit, debit,
phone, and other cards in one piece of plastic.
c)Digital Cash
Digital cash is a form of electronic currency that functions similarly
to a debit card. Customers can transfer money from savings and checking
accounts into an online cash account, from which they withdraw to make
purchases over the Internet. This form of payment is particularly well
suited to purchases of small, low-cost items. In addition, it offers
consumers the benefit of anonymity in their purchases, similar to using
real cash. The basic technology involved in digital cash transactions is
public-key encryption. Digital signatures are used to authenticate the
bank issuing the note and the individual computer user who is spending
the money.
Some people expect digital cash to become the preferred method of
online payment in the near future. "Eventually, people using the Net
probably will have digital cash on their computer much the same as they
have bills and coins in their wallet or purse," Dowling stated. In fact,
digital cash accounts could be integrated into consumers' Web browsers,
and companies that provide content on their Web sites (like online
newspapers and magazines) could charge a nominal fee for surfers to
view their sites. But methods still need to be established to standardize
the use of digital cash.
d)Electronic Checks
Small businesses can also allow customers to pay for online
purchases by accepting personal or business checks online. "Although not
as popular as credit cards, electronic checks are also accepted by
hundreds of merchants on the Net," . "While most electronic check
schemes require the merchant to use special software, electronic checks
might appeal to you if you do not currently have a credit card merchant
account." Online merchants who accept electronic checks generally set up

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a form on a Web page and have their customers enter all the information
from their regular checks. The merchant can submit this information to a
bank like a regular check. A digital signature is used in place of a
handwritten one to verify the identity of the customer. One advantage of
electronic checks is that it provides customers with a familiar method of
payment. In addition, a number of services are available to simplify the
process for both consumers and merchants.

e)Secure Third Parties And Online Banks

Banks have traditionally been reluctant to do business online
because of the perceived security risks. But banks have begun offering an
increasing number of services online in response to customer demands.
Secure third parties may be banks or other institutions that act as
middlemen in financial transactions between merchants and customers.
For small businesses, conducting transactions through a secure third party
eliminates the need and expense of setting up a secure Web site. Secure
third parties also provide consumers with added protection from fraud,
since the merchants never handle their credit card numbers. "Secure third
parties will become more popular as smaller merchants with fewer
resources continue migrating on-line," Dowling wrote. "While a small
company may want to keep Web operations in-house, it may not want to
purchase or maintain a secure Web server. Third-party solutions offer an
affordable alternative to expensive, secure servers and local Internet
providers that don't offer secure transaction capability."
f)Old-Fashioned Payment Methods
A final alternative for companies that conduct sales over the
Internet is to accept payment via traditional, offline methods by taking
orders through an address or phone number listed on their Web site, for
example. However, experts warn that limiting payment methods in this
manner may cost a company some potential sales. One avenue in which
using traditional payment methods may not hurt sales is business-to-
business transactions. Even when sales are made over the Internet, many
businesses choose to use existing methods to bill their customers'

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accounts. In order to protect both parties in an online transaction from

fraud, businesses may find it helpful to require all new accounts to be
opened in writing via fax or mail. In this way, the seller has a printed
document on hand listing the names of authorized buyers, along with
approved e-mail addresses, shipping addresses, and purchase amount
limits. Any changes to this account information should also be made in
writing. Finally, the seller should verify orders by telephone and send an
e-mail confirmation upon shipment.

g)Security Efforts
Security remains the main concern about online payment systems,
particularly the use of credit cards for purchases made over the Internet.
Although media reports tend to concentrate on the effect of security
breaches on consumers, credit card fraud affects merchants as well. For
example, when hackers infiltrate a company's computers, steal thousands
of customer credit card numbers, and use them to charge fraudulent
purchases, the online retailer's reputation suffers severe damage. In
addition, companies are sometimes left without recourse when they
accept a credit card order and ship the merchandise, only to have the
customer claim that they never ordered or received it.
But many e-commerce analysts claim that transmitting credit card
numbers online does not have to be any less secure than handing a card
to a salesperson at retail store. Within the United States, credit card
numbers sent over the Internet can be protected by sophisticated
encryption technology which is often invisible to parties involved in the
sale. In fact, encryption capability is built into many popular Web browsers
used by consumers, and the software needed to decrypt messages is
widely available to online merchants at a reasonable price.
For small businesses that operate their Web sites on a server
belonging to an Internet Service Provider (ISP) or other host, it is still
possible to accept credit card payments online. Many hosts will collect
customer financial data and pass it along to their clients in encrypted

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form. Small businesses that do not have access to a secure Web server
can also go through a company like Versanet, which allows companies to
call their own secure order page on the Versanet server to process credit
card transactions. Experts recommend that companies unable to use
encryption (for example, companies that are located in countries where
encryption is illegal) either not accept credit card orders online or use a
two-stage order process that separates credit card numbers and
expiration dates into chunks or data that would be difficult for hackers to
identify.

3.1.3 DIGITAL PAYMENT REQUIREMENTS

For any digital payment system to succeed, the criteria are

a)Online Payment Categories:

Online payment can be broadly divided into three categories they
are:

E-payment systems are proliferating in banking, retail, healthcare,

online markets and even in government; in fact, anywhere money needs
to change hands. Organizations are motivated by the need to deliver

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products and services more cost-effectively and to provide a higher

quality of service to customers. Research into e-payment system for
consumers can be traced back to the 1940s, and the first applications, the
credit cards appeared soon later. In the early 1970s the emerging
electronic payment technology was labeled electronic funds transfer
(EFT), EFT is defined as:
Any transfer of funds initiated through an electronic terminal,
telephonic instrument, or computer or magnetic tape so as to order,
instruct, or authorize a fine new institution to debit or credit an account.
EFT utilizes computer and telecommunication components, both to
supply and to transfer money or financial assets. Transfer is information –
based and intangible. Thus EFT stands in market contrast to conventional
money and payment modes that relay on physical delivery of cash or
cheque for other paper orders to pay by truck, train or airplane. Since
1947, significant changes have taken place in fund transfer. You can find
them listed here:

3.4 DIGITAL TOKEN BASED ELECTRONIC PAYMENT SYSTEM IN E-

COMMERCE

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The digital token based payment system is a new form of electronic

payment system which is based on electronic tokens rather than e-cheque
or e-cash. The electronic tokens are generated by the bank or some
financial institutions. Hence we can say that the electronic tokens are
equivalent to the cash which are to be made by the bank.
Categories of Electronic Tokens:-
I. Cash or Real Time:-
In this mode of electronic tokens transactions takes place via the
exchange of electronic currency (e-cash).

2. Debit or Prepaid:-
In this electronic payment system the prepaid facilities are provided.
It means that for transactions of information user pay in advance. This
technology are used in smart card, electronic purses etc.
3. Credit or Postpaid;-
These types of electronic token based on the identity of customers
which issue a card, their authentication and verification by a third party. In
this system the server authenticate the customers and then verify their
identity through the bank. After all these processing the transaction take
place. Example is E-Cheques.
The Digital Token based system have following issues for which they
are established:-
Approach to Security, Anonymity and Authentication:-
Since the electronic token are vary from system to system when the
business transaction take place. So it is necessary to secure it by intruders
and hackers. For this purpose various security features are provided with
electronic tokens such as the method of encryption. The encryption
method use the digital signatures of the customers for verification and
authentication.
Risk Factors:-
The electronic tokens may be worthless and if the customer have
currency on token than nobody will accept it, If the transaction has long

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time between delivery of products and payments to merchants then

merchant exposes to the risk. so it is important to analysis risk factor in
electronic payment system.

3.5 CLASSIFICATION OF NEW PAYMENT SYSTEMS

Electronic commerce can be broadly categorized into two groups,

business-to-business (B2B) and business to consumer (B2C). B2B normally
involve higher value transactions and predominant payment methods are
electronic cheques and bank transfers, whereas, B2C payments are lower
value transactions and payment methods used are cash and card based
payment systems. This section presents an overview of e-payment
classifications.

a)Payment instruments
There are three common electronic payment instruments, namely
cash, cheque and card. Cash payment systems consist of self-
authenticating divisible tokens that can be processed offline. Cheque
payment system is typically linked to a payer’s account and payment is
indivisible. Card payment schemes provide a payment mechanism
through the existing credit card payment infrastructure.
b)Pre-paid, Pay-now and Post-pay
In pre-paid system the payment is debited from the payer’s account
before a payment is processed and hence the term “pre-paid”. Most cash-
like systems such as an electronic-cash system fall in this category. In
pay-now system, when an electronic transaction is processed, the payer’s
account is debited and the payee’s account is credited with the payment
amount.
Even though availability of funds depends on the time when inter-
bank settlements are carried out, the payer’s and payee’s account are
updated to show the debited and credited balances immediately after an
transaction is carried out. Credit card based system, like Secure Electronic
Transaction (SET) , Verified by Visa (VBV) , MasterCard secure-code fall
into this category. In post-pay systems the payer’s account is debited only

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when the payee’s makes a request for payment settlement with the
acquirer. Most cheque based systems [14] [15] fall into this category.
c)Offline and Online
Based on communicational characteristics, electronic payments
systems are classified as offline and online systems. In an offline system,
the communication does not involve any third party, i.e., an electronic
transaction takes place only between the payer and the payee. The
advantages of offline payments are lower communication cost and less
time-critical transaction handling at the banks. However, they suffer from
one serious drawback, the problem of double spending.
Double spending occurs when the payer spends the same electronic
money multiple times. In a digital system the payer could make a backup
of electronic money before each payment and reset his system to this
backup after the payment. In this way, an arbitrary number of payments
to different recipients are possible with the “same” money. Typically,
double spending is prevented with the use of tamper-resistant hardware
e.g. a smart card. In certain cases, the tamper-resistant hardware is
issued by the bank containing a pre-authorized value of money. However
tamper-resistant devices only offer limited protection as they are
vulnerable to attacks. Another way to prevent double spending is pre-
authorization. The payer obtains pre-authorized secure digital money from
its bank, thus the payee is assured of payment e.g. a bank cheque.
However, this method can only be used if the payee is known to the payer
before a payment. A weaker solution, rather than employing prevention
techniques is to detect double spending when they occur and the
dishonest payer can be held accountable. This solution is used in most e-
cash implementations. Adequate security can be achieved by a combined
approach that would involve both detection methods and tamper-resisted
devices.
In an on-line system, the payee typically connects to the bank to
obtain a payment authorization, thus increasing the communication
requirements for the payment system. The advantage is, the payee

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obtains a guarantee on the payment, as the bank is able to authorize and

check for availability of funds in the payer’s account.
d)Basic model of e-cash system
An anonymous off-line e-cash consists of three probabilistic,
polynomials-bounded parties, a bank B, payer P, and payee R, and three
main sub protocols: withdrawal, payment and deposit. Payer and payee
maintain their accounts with the bank. The payer withdraws electronic
coins from their account with the bank, by performing a withdrawal
protocol over an authenticated channel. The payer spends coins by
participating in a payment protocol with the payee over an anonymous
channel. In effect, the payee performs a deposit protocol, to deposit the
coins into their account. The e-cash system also includes setup protocols:
system setup, payer setup and payee setup which performs system
initialization functions, namely creating and publishing public keys and
opening payer and payee bank accounts.

e)Pay now or Card based system

The most common method for “on-line” payment is card-based
systems. Most payment systems in this category are specifically designed
for transaction conducted through the Internet. Because of their
convenience and omnipresent nature, credit cards in particular have

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become a popular method for conducting online payments over the

Internet, but they are insecure, offer no anonymity or protection of
payer’s payment information like card details and account information. To
overcome these drawbacks and make card payment more secure, the two
leading credit card companies VISA and MasterCard have developed
various protocols. This section presents an overview of various card-based
systems that have been proposed.
Due to the limited popularity of both STT and SEPP proposals,
MasterCard and Visa in a joint effort proposed Secure Electronic
Transaction (SET) system that would take advantage of the combined
customer and merchant base. SET was published as an open specification
for the industry and the development of the payment system included
major companies like GTE, IBM, Microsoft, Netscape, RSA, SAIC, Terisa and
VeriSign. It incorporates digital signatures for not only authenticating
customer but also merchants and banks. SET also included a unique
concept known as dual signatures. The main goal of dual signatures is to
protect the customer’s account information from the merchant and
purchase information from the banks. Dual signatures link purchase
information (like order message) sent to the merchant with the payment
information (like account information) sent to the acquirer. When the
merchant sends an authorisation request to the acquirer, it includes the
payment information sent to it by the cardholder (customer) and the
message digest of the purchase information. The acquirer uses the
message digest from the merchant and computes the message digest of
the payment information to check the dual signature. Even though the
advantages of using SET are apparent, due to the system complexity, and
implementation costs for both merchant and banks, the system has failed
gain widespread market acceptance.

Today there are two major proposals for secure electronic payment
over the Internet. They are Visa 3-D Secure (Verified by Visa - VBV) and
MasterCard Secure Code. Both protocols rely on SSL /TLS to encrypt
communication over the Internet. SSL is a client-server protocol that uses

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public key cryptography and has become the de facto standard for
encrypted communication over the Internet. In SSL, only servers
(merchants) have public key certificates and clients (buyers) remain
anonymous to the servers. Because of the lightweight nature and an
existing wider deployment base of SSL protocol, MasterCard and Visa
have implemented a standard that would allow merchant to incorporate
the proposed security features into their payment acceptance structure.
f)Pay later or Cheque based system
Customers generally tend to use credit card payment methods for
low and middle value payments, whereas, cheque is the preferred method
for large value payments. Various electronic cheque (e-cheque) protocols
have been proposed over the years. Systems like FSTC’s E-Check , Net
Cheque and MANDATE II are based on methods used in traditional paper
based checking protocols. Systems like Net Bill , E-Cheque and PayNow by
CyberCash use a central server. Other e-checking systems are based on
modified versions of e-cash protocols . But most promising of all e-cheque
system that has the support of major financial institutions and
government agencies has been the FSTC’s E-Check system.

g)Micropayments
One of the most promising payment methods is the use of micro
payments: the ability to pay for data or services in small increments.
Micro payments can be seen as a solution to allow low-value payments for
purchasing news articles, stock quotes, index queries, per-click purchase
and other services over the Internet.

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3.6 PROPERTIES OF E-CASH :TO PURCHASE ITEMS OVER THE

INTERNET

People currently use credit cards as the prevailing form of payment.

For years, however, people have asked "Why not use Electronic Cash?"
These are the properties that would be necessary for such a scheme:
1. Financial Infrastructure: There is a big deference between bits and
atoms. People have used atoms, gold, bills, etc. as money. Behind the bits
in E-cash, there must be financial infrastructure that the money
represented by the instructions in the bits from one account to another. A
transaction is an instruction to move money from a consumer's account to
a merchant's account.
2. No Double-Spending and Non-forge ability: Bits can be easily duplicated
but atoms cannot. So copies of cash should not be spendable. Nor should
one be able to forge or create e-cash and spend it.
3. Security: Account information should be kept secure. Transfers should
be kept secure.
4. Immediate Verifiability that Payment is OK Online vs. Online systems:
Every time you receive a payment, you could instantly relay it to the bank
to verify it. Or there could be an intrinsic property that lets you know the
money is good if a bank is not readily available.
5. Persistence: Atoms stick around better than bits do. If your computer
crashes, you should not be bankrupted. A backup of your wallet to record
your wealth should not be spendable.
6. Exclusive Ownership

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7. Anonymity: There are different types of anonymity, payer, payee, and

even bank anonymity. The merchant may accept money without knowing
who the payer is. Also you should be able to deposit money without the
bank knowing where the transaction comes from. There are issues of
money laundering. People can transfer money without the bank knowing.
8. Transferability: A can pass money to B and then to C easily and
anonymously.
9. Amounts: It would be nice to support a variety of "coin sizes".
10. Traceable to issuer: We should know who backs each bit of money.
E.g., We can tell by inspection that U.S. money is issued by the U.S.
treasury.
11. Divisibility and Combination: If you have an instrument worth 1 dollar,
you should be able to divide it into two instruments each worth 50 cents.
12. Compatibility with existing systems: An electronic payment system
should interface smoothly with existing payment systems. (To what extent
a monetary system actually depends on others is an interesting open
question; can you have e.g., a Galactic System with no central
Government authority?)
13. Efficient for small amounts
14. Scalability
15. Competition between Issuers: Free banking before the Gold Standard
3.2 Information systems for Mobile Commerce
3.2.1 Introduction
Mobile commerce (m-commerce, m-business)—any e-commerce done in a
wireless environment, especially via the Internet.
• Can be done via the Internet, private communication lines, smart
cards, etc.
• Creates opportunity to deliver new services to existing customers
and to attract new ones
• M-commerce is the buying and selling of goods and services through
wireless handheld devices.
• M-Commerce is the process of paying for services using a mobile
phone or personal organizer.

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• M-Commerce is the use of mobile devices to communicate, inform

transact and entertain using text and data via a connection to public and
private networks.
• Is the ability to conduct commerce using a mobile device. such as :
 Mobile phone.
 Personal digital assistant (PDA).
 Smartphone.
a) M-commerce benefit
• Your Internet offerings are easier and more convenient to access.
• You get considerable flexibility while conducting business.
• Transaction and personnel costs are reduced due to widespread
automation of back-office operations.
• Field staff is more effective as they have flexible access to back-
office data.
• For a small business could benefit from m-commerce.
• Selling a product or service
• Improving productivity
• Attributes of M-Commerce
 Ubiquity
 Convenience
 Interactivity
 Personalization
 Localization

a) M-Commerce Services and Applications available:

• Mobile ticketing

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• Content purchase and delivery

• Information services
• Mobile banking
• Mobile Browsing
• Auctions
• Mobile Purchase
• Mobile marketing and advertising
b) Mobile ticketing
• Tickets can be sent to mobile phones using a variety of
technologies. Users are then able to use their tickets
immediately, by presenting their phones at the venue.
• Tickets can be booked and cancelled on the mobile device
with the help of simple application downloads
c) Content purchase and delivery
• Mobile content purchase and delivery mainly consists of the sale
of ring-tones, wallpapers, and games for mobile phones.
• The convergence of mobile phones, portable audio players, and
video players into a single device is increasing the purchase and
delivery of full-length music tracks and video.
d) 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

i) Characteristics of M-Commerce

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A Example
i) The Problem
•Buses in San Francisco have difficulty keeping to 20 minute schedule
during rush hours
•Posted schedule becomes meaningless
ii) The Solution
•Bus riders carrying Internet-enabled cell phone or PDA helps:
1. Find estimated arrival time at each stop, digitally in real time
2. Soon location-based advertisements will pop up—you have time to
get a cup of coffee before the bus arrives—Starbuck’s is 200 feet to the
right
iii) Next Bus Operational Model
iv) The Results
• Passengers in San Francisco are happy with the system
1. Worries about missing the bus are diminished
2. May discover they have time for a cup of coffee before the bus
arrives
• Bus company can:
1. Schedule better
2. Arrange for extra buses when needed

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3. Improve operations

v)Classification of M-Commerce Services

 Financial
e.g. Secure banking services
 Entertainment
e.g. Mobile Gambling
 Shopping
e.g. Purchase of goods
 Information
e.g. Local Information
 Payment
e.g. Electronic Wallet
 Advertising
e.g. Intelligent Advertising
 Enabling Technologies
Introduce two transmission mode, GPRS and W-CDMA
GPRS (General Packet Radio Service)

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• A step between GSM and 3G cellular networks.

• Transmission rate via a GSM network within 9.6Kbps ~ 115Kbps.
• GPRS supports the widespread range of bandwidth, it is a effective
application under the limited bandwidth.
• Mobile phone can receive and transmit data at the same time. (e.g.
make a phone call and receives e-mail at the same time)
W-CDMA (Wideband Code-Division Multiple Access)
• the transmission technology for third generation (3G) UMTS mobile
communication.
• The transmission rate is up to 2Mbps, it makes mobile multimedia
grows rapidly.
g) WAP(Protocol) and i-mode(Service)
WAP(Wireless Application Protocol)
• It is a open and standard wireless application software protocol.
• The WAP system are composed of two main factors：
WML（Wireless Markup Language）: similar to HTML
WAP Gateway / Proxy : to change the webpage source code to the
suitable one.
• Need a connecting action
• Payment according to time used.
i-mode
• The first packet-based, always-on, mobile Internet service
• Various services available : Banking, game, wallpaper, music….
• Payment according to packets received.
Other related technologies
• J2ME (Java 2 Micro Edition)
A kind of programming language used in small, connectable consumer
and embedded devices. it makes mobile phones have a ability to execute
program.

• XML（eXtensible Markup Language）

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A Standard for structured document interchange on the Web. It makes the

description language used by different browsers can be changed more
quickly.
• IPv6
IPv4 use 32bit, this is not enough. IPv6 expand it to 128bit, so that every
mobile phone can get its own IP.
h) Mobile Payment Players

i) Mobile Payment Issues

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ii)Mobile Interfaces

iii) Mobipaysystem

iv)Internet waves

Today

v)Mobile banking (M-Banking)

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• Banks and other financial institutions use mobile commerce to allow

their customers to access account information and make transactions,
such as purchasing stocks, remitting money
vi)Mobile Browsing
• Main article: Mobile browser Using a mobile browser—a World Wide
Web browser on a mobile device—customers can shop online

vii)Mobile Commerce Application

Google Apple
Android Apple store
Google Android Market The App Store is a digital
application distribution platform for iOS developed and maintained by
Apple.

a)Advantage and disadvantages of M-commerce

 Offers many payment options
 Push advertising, direct marketing.
 More efficient and extensive service offered.
 The Internet is going mobile

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 Can be easily setup

b)Disadvantage
 Expensive cost
 Larger screens won’t be displayed is clear
 Slow speed
 Limited for longer message
 It hard way to fill the data. Security is not protected
 Meteoric growth of the Internet and mobile communications
 Increasing mobility
 New applications, services and business models
 Enabling technologies
The core of m-commerce is the use of a terminal (telephone, PDA, PC
device) and public mobile network to access information and conduct
transactions that result in the transfer of value in exchange for
information, services or goods. Mobile Commerce refers to any transaction
with monetary value that is conducted via a mobile telecommunications
network.

3.2.2 WIRELESS APPLICATION

WAP (Wireless Application Protocol) is a specification for a set of
communication protocols to standardize the way that wireless devices,
such as cellular telephones and radio transceivers, can be used for
Internet access, including e-mail, the World Wide Web, newsgroups, and
instant messaging. While Internet access has been possible in the past,
different manufacturers have used different technologies. In the future,
devices and service systems that use WAP will be able to interoperate.
WAP incorporates a simple micro browser, designed to work on the
limited platforms of mobile handsets, with a central WAP gateway that
performs the more processor-heavy operations. It defines a standard for
data transmission to the handset, WDP (WAP datagram protocol), which is
a variation of the internet standard transmission protocol, HTTP
(Hypertext Transport Protocol), but redesigned for wireless network
characteristics. WDP mostly differs from HTTP by stripping out much of
the text information, replacing it with more efficient binary information for

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the low-bandwidth connection. The WAP data can be sent over any
available network, be it the circuit-switched connection of TDMA (Time
Division Multiple Access) IS-136 or packet-switched GPRS.
Added to this core transmission protocol are several scalable layers
that can develop independently. The wireless transport layer security
(WTLS) layer adds optional encryption facilities that enable secure
transactions. WTP (WAP transaction protocol) adds transaction support,
adding to the datagram service of WPD, while WSP (WAP session protocol)
allows efficient data exchange between applications.
WAP also defines an application environment (WAE) that enables third-
party developers to develop more advanced services and applications,
along with the micro browser used to access web pages on the handset
itself.
To access internet content, the user's handset sends a request to
the WAP gateway, which retrieves the information in either HTML
(Hypertext Markup Language) or WML (Wireless Markup Language) from
the host server. WML is a variation of HTML, designed specifically to
enable viewing on the limited mobile terminal platform. If the information
retrieved is in HTML, a filter in the gateway will attempt to convert it to
WML. The information will then be transmitted to the handset over
whatever network is available, using the transmission protocols described
above.
In some cases, where HTML data is generated using a style sheet to
convert XML data using an XSL processor, a WML style sheet can be
added to the system to generate seamless information in the correct
format for wireless viewing.
a)Future Of Wap
Because WAP is a protocol designed to work over any mobile
network, its use will continue to increase as more sophisticated data
transmission technologies are introduced (e.g. GPRS, EDGE (Extended
Data for Global Evolution) and W-CDMA (Wideband-CDMA)). As the
bandwidth available to mobile terminals and the quality of displays

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improve, WAP can be enhanced to provide as effective an internet viewing

experience as is possible on fixed terminals.

3.2.3 CELLULAR NETWORKS

A cellular network is a radio network distributed over land through
cells where each cell includes a fixed location transceiver known as base
station. These cells together provide radio coverage over larger
geographical areas. User equipment (UE), such as mobile phones, is
therefore able to communicate even if the equipment .
Cellular networks give subscribers advanced features over
alternative solutions, including increased capacity, small battery power
usage, a larger geographical coverage area and reduced interference
from other signals. Popular cellular technologies include the Global
System for Mobile Communication, general packet radio service, 3GSM
and code division multiple access.
Cellular network technology supports a hierarchical structure formed by
the base transceiver station (BTS), mobile switching center (MSC), location
registers and public switched telephone network (PSTN). The BTS enables
cellular devices to make direct communication with mobile phones. The
unit acts as a base station to route calls to the destination base center
controller. The base station controller (BSC) coordinates with the MSC to
interface with the landline-based PSTN, visitor location register (VLR), and
home location register (HLR) to route the calls toward different base
center controllers.
Cellular networks maintain information for tracking the location of
their subscribers' mobile devices. In response, cellular devices are also
equipped with the details of appropriate channels for signals from the
cellular network systems. These channels are categorized into two fields:
• Strong Dedicated Control Channel: Used to transmit digital
information to a cellular mobile phone from the base station and vice
versa.
• Strong Paging Channel: Used for tracking the mobile phone by MSC
when a call is routed to it.

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A typical cell site offers geographical coverage of between nine and

21 miles. The base station is responsible for monitoring the level of the
signals when a call is made from a mobile phone. When the user moves
away from the geographical coverage area of the base station, the signal
level may fall. This can cause a base station to make a request to the MSC
to transfer the control to another base station that is receiving the
strongest signals without notifying the subscriber; this phenomenon is
called handover. Cellular networks often encounter environmental
interruptions like a moving tower crane, overhead power cables, or the
frequencies of other devices.

a)Cellular networks: From 1G to 3G

 1G: First generation wireless cellular: Early 1980s
o Analog transmission, primarily speech: AMPS (Advanced
Mobile Phone Systems) and others
 2G: Second generation wireless cellular: Late 1980s
o Digital transmission
o Primarily speech and low bit-rate data (9.6 Kbps)

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o High-tier: GSM, IS-95 (CDMA), etc

o Low-tier (PCS): Low-cost, low-power, low-mobility e.g. PACS
o 2.5G: 2G evolved to medium rate (< 100kbps) data
 3G: future Broadband multimedia
o 144 kbps - 384 kbps for high-mobility, high coverage
o 2 Mbps for low-mobility and low coverage
 Beyond 3G: research in 4G

• Handoffs (typically 30 mseconds):

1. At any time, mobile station (MS) is in one cell and under the control of a
BS
2. When a MS leaves a cell, BS notices weak signal
3. BS asks surrounding BSs if they are getting a stronger signal
4. BS transfers ownership to one with strongest signal
5. MTSO assigns new channel to the MS and notifies MS of new boss
 Cell-id based location.
o assigned an id of the cell that you are in.
o cell-id is stored in a database.

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o As you move from one cell to another, you are assigned a

different cell-id and the location database is updated.
o most commonly used in cellular networks. (HLR, VLR)
 Neighborhood polling: Connected mobile units only move to
adjacent cells
 Angle of arrival (AOA). the angle at which radio waves from your
device "attack" an antenna is used to calculate the location of the
device.
 Time taken. In this case, the time taken between the device and the
antenna is used to calculate the location of the device.
 Network assisted Global Positioning System (GPS). a GPS chip is
installed inside a phone and thus the location of the user is tracked.

3.2.4 WIRELESS SPECTRUM

The wireless spectrum consists of electromagnetic radiation and
frequency bands. Respective countries have their own wireless spectra
with ranges up to 300 GHz. The wireless spectrum frequencies used in
communication are regulated by national organizations, which specify
which frequency ranges can be used by whom and for Which purpose.
Radio-channel and channel-frequency variation is quite complex because
radio propagation characteristics are a result of both man-made and
natural factors. Government entities own frequency channels, which are
divided according to common frequency band characteristics and cause
performance breaks at different frequency levels, where only windows of
continuity are available.
The wireless technology boom has created divisions in spectrum
allocation. The International Telecommunications Union (ITU) divides the
world into three different regions that influence wireless signal
propagation:
• Region 1 : Europe, Africa, parts of the Middle East and Northern Asia
• Region 2 : The Americas, Caribbean and Hawaii
• Region 3 : Asia, Southeast Asia, the Pacific Islands, Australia and
New Zealand
Radio signals are a form of electromagnetic radiation

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Usually thought of as waves with frequency, wavelength and amplitude

Amplitude is wave height, represents power, decreases with distance

• Frequency is how long to complete 1 cycle, then repeat
• Unit of frequency is Hertz (Hz), cycles per second
• 1000 Hz = 1 kiloHertz (kHz)
• 1000000 Hz = 1 megaHertz (MHz)
• 109 = 1 gigaHertz (GHz)
• 1012 = 1 teraHertz (THz)
• All waves travel at speed of light in vacuum = 3 x 108 m/s
• Speed = lf, inverse relationship, high freq = short wavelength
• Most media (e.g. air, clouds) slow down wave speed by a factor
• Radio waves also suffer from attenuation (reduction in power) over
distance
• Can classify radio waves based on either wavelength or frequency
• Infra-red also used for data transmission, LOS, affected by sun

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a)Physical Layer – Transmission Types

• Infrared light spectrum
• Radio wave spectrum
• Microwave spectrum

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b)Infrared Light - Positive Options

• Inexpensive
• Compatible with fiber-optic links
• Not bandwidth limited
• No licensing required (FCC)
• Transmissions may be aimed (1 to 2 kilometers)
• Transmissions may be Omni-directional (30-60 feet)
• Amplitude driven – little interference
• Range of 1-2 kilometers (approximately ½ to 1 ½ miles)
• Highest bandwidth and throughput
• Infra LAN – product with infrared transmission
c)Infrared Light – Negative Aspects
Spectrum is shared with the sun and other lighting sources
LAN may become “useless” with enough interference
Signals will not permeate opaque objects (walls, dividers, etc)
d)Microwaves

e)Microwave - Positive Options

• Higher throughput without spread spectrum
• 5.8ghz band – using a narrow-band transmission
• Radio LAN - product using microwave transmission
f)Microwave – Negative Aspects
• Expensive to build infrastructure
• Must operate at less than 500 milli watts (strict FCC regulations)
• Not commonly used – less available knowledge pool
g)Radio Waves – Spectrum

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i)Radio Waves - Positive Options

• Commonly understood technology
• Not subject to interference of light waves like infrared
• Less expensive than microwave
• Long-range medium – several architectures exist
• Commonly used – larger knowledge pool
• WaveLAN, BreezeNet pro, Proxim Rangelan2, & RadioLAN
ii)Radio Waves – Negative Aspects
• Spread spectrum technology – high overhead
• Lower rates of data transmissions – due to overhead required
• Subject to some interference – causing delays in transmission
iii)Radio Waves – Spread Spectrum Methods
• Direct Sequence Spread Spectrum (DSSS)
• Transmission signal is spread over an allowed band
• Frequency Hopping Spread Spectrum (FHSS)
• Splits the band into subchannels – signal then hops to transmit
iv)Radio Waves – Direct Sequence Spread Spectrum (DSSS)
• Random Binary String Modulates the Transmission Signal
• Spreads signal over a band (Example, 50 MHz)

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• String is known as a “Spreading Code”

• Bits are mapped out as “chips” and mapped back as “bits”
• Spreading Ratio – The number of “chips” per bit
h)DSSS Spreading Ratios
• Higher Ratios Resist Interference Better
• Lower ratios allow for use of more bandwidth
• FCC dictates spreading ratios must be more than ten
• IEEE 802.1 standard requires a spreading ratio of eleven
• Sender & Receiver must synchronize to the spreading code
• Orthogonal spreading codes allow sharing of the band between
LANs
• DSSS systems use wide subchannels, limiting LANs possible
• Recovery is faster with DSSS due to ability to spread the signal over
a wider band
• Example Product = WaveLAN
i)Radio Waves – Frequency Hopping Spread Spectrum (FHSS)
• Splits the band into many subchannels (1-2MHz)
• Signal “hops” from subchannel to subchannel
• Uses short bursts of data on each channel
• Bursts are within a “dwell” time (very short time)
• FCC requires at least 75 subchannels
• FCC requires “dwell” time of no longer than 400ms
• Less interference than DSSS due to hopping
• Security is higher due to the hopping
j)Wave Bands
• Radio spectrum can be sub-divided into regions called wavebands

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 Higher freq.,
o shorter wavelength, more bandwidth
o More blockage
 Lower freq.,
o attenuated more
o Can bend round obstacles
 Example:
o AM radio can span entire country with 1 transmitter
o VHF can only span 1 city

3.2.5 TECHNOLOGIES FOR MOBILE COMMERCE

Buying and selling of products or services using a mobile device
Mobile/smart phones

a)PDAs
i)Emerging mobile equipment Dashtop mobile devices
Commerce: be able to buy/sell..
eCommerce: ...using a computer network...

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mCommerce: ...anytime & anywhere

ii)Device Platforms for m Commerce
[Link]
Mobility
Graphical user interface
Network connectivity
Good input capability

[Link]
Low bandwidth
Limited resources: CPU, RAM, battery, screen,
small/inconvenient keyboard
b)Mobile Phones
Primary feature:
voice communication
SMS (text messages)
MMS (photo and video)
Micro browsers
Java support
Top 5 manufacturers:
Nokia, Samsung, Motorola, Sony Ericsson, LG
c)Smart Phones
Symbian, Linux, Windows Mobile, RIM Blackberry, Palm
OS
Apple OS X
d)Smart Phones: iPhone
TIME Magazine’s 2007 invention of the year
The iPhone is pretty

It's touchy feely

It will make other phones better

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It's not a phone, it's a platform

It is but the ghost of i Phones yet to come

3.2.6 WIRELESS TECHNOLOGIES

While electronic commerce (e-commerce) continues to have a
profound impact on the global business environment, technologies and
applications have begun to focus more on mobile computing and the
wireless Web. With this trend comes a new set of issues and problems
specifically related to wireless e -commerce. Ultimately, researchers and
developers must determine what tasks users really want to perform
anytime from anywhere and decide how to ensure that information and
functionality to support those tasks are readily available and easily
accessible.
This paper provides an overview of some of the relevant
technologies, applications, and issues in the relatively new field of
wireless e-commerce. Wireless e-commerce (also called mobile commerce
or m-commerce) is the promotion, buying, and selling of goods and
services through electronic data communication networks that interface
with wireless (or mobile) devices. Wireless e-commerce is a subset of
wireless computing, which is the accessing of information systems by
wireless means. Many of the issues that affect wireless computing in
general also affect wireless e-commerce. Mobile e-commerce also includes
the use of devices such handheld and laptop computers that interface
with computing resources through wired synchronization. We do not
consider this wired form of mobile e-commerce in this paper principally
because it is likely to be replaced by wireless devices in the future. Our
focus here is on the wireless forms of mobile commerce.
a)Technologies
Wireless technologies for mobile commerce can be roughly
categorized into mobile client devices for interactivity (or m-commerce
terminals) and communications infrastructure.
b)Mobile Client Device Technologies and Issues

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The interactivity devices or mobile client devices currently most

important to wireless e-commerce are mobile telephones, handheld
computers, laptop computers, and vehicle-mounted interfaces. Hybrid
devices are now appearing, such as the crosses Between mobile phones
and handheld devices (sometimes called smart phones), but the question
remains as to what form the devices will ultimately take, which is an
important issue for mobile system developers Usability will become more
critical with handheld and phone devices, which differ from desktop and
laptop computers in terms of their smaller screen sizes, less available
memory, and limited input devices.
Many handheld devices are limited to a few lines of text, and do not
have traditional keyboards. One usability issue is the need for
organizations to determine how people can best use applications and
access information through different devices. Wireless devices have
forced developers to carefully revisit both operating systems and
applications software on a variety of platforms. Operating systems such as
Microsoft’s Pocket PC and Palm’s Palm OS have been developed for
handheld devices. Although this software meets some of the current
needs, it has limited functionality. The creation of system software with
increased functionality for devices with limited capabilities will be an
ongoing challenge.
Another important building block for this emerging infrastructure
landscape may be the Wireless Application Protocol (WAP), which enables
wireless devices such as mobile phones to access the Internet. Many WAP-
enabled devices have already appeared, although there is doubt as to
whether WAP will become a globally accepted standard, especially with
the popularity of Japan’s i-mode. Developers ultimately face the issue of
deciding which set of protocols to accept, or risk the potential problems of
working with multiple standards and/or choosing to ignore some.
Communications Infrastructure Technologies and Issues The
communications infrastructure necessary for the wireless Internet
environment is quite complex. Wireless devices are likely to remain at a
disadvantage over their wired counterparts in terms of bandwidth. Limited

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bandwidth is a significant problem that requires organizations to rethink

how users interact through a wireless device with an information system.
An important issue show to create efficient applications that can
realistically work with current technology.
c)Local Area Network Technologies
IEEE 802.11 and IEEE 802.11b are established wireless standards
commonly used with laptops or personal computers for wireless local area
networks. This technology provides speeds of 1 to 11 megabits per second
(Mbps). Bluetooth is a relatively new,
inexpensive short-range wireless standard that allows different devices
(such as laptops and mobile phones) to communicate with each other. The
maximum distance between devices is about 100 meters, and data
exchange rates are 1 to 2 Mbps. Hiper LANis a set of wireless LAN
standards, primarily used in Europe, which provides speeds up to 20
Mbps.
Issues that must be addressed concerning local area network
technologies include a lack of compatibility between the different
standards and the related difficulties involved with devices trying to
interface with more than one communications environment. Frequencies
used for wireless LANs are expected to become very crowded very fast.
There has also been recent concern about possible interference problems
between different signals of different standards.

d)Telecommunications Technology
There are three basic “second-generation” (2G) digital wireless
telephone technologies – time division multiple access, Global System for
Mobile communication (GSM), and code-division multiple access. All these
are circuit-switched services, where a user must dial-in and maintain a
connection when data communications are desired. GSM is the most
widely used of the three technologies, especially in Europe; its current
speed is only 9.6 kilobits per second (Kbps). General Packet Radio Service
(GPRS), based on GSM, is a continuous packet data service. Using this

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technology, network connections are “always-on”, and mobile users need

not dial into the Internet each time they need to access an application.
GPRS promises data rates from 56 to 114 Kbps. GPRS
communication channels are used on a shared basis, only sending or
receiving packets as needed, rather than maintaining a continuous
dedicated line as with circuit-switched services. UMTS (Universal Mobile
Telecommunications System) is a so-called “third-generation” (3G)
technology. It offers broadband, packet-based transmission at rates that
will exceed 2 Mbps. Based on GSM, UMTS is the planned global standard
for mobile users.
Once UMTS is fully implemented, computer and phone users can be
constantly attached to the Internet and have access to a consistent set of
services worldwide. Many of the issues with telecommunications
technologies are similar to those found with LANs. There are distinct
bandwidth limitations with the older generation technologies, which make
it difficult to develop efficient applications for all technologies. Standards
vary from country to country, making it difficult for devices to interface to
networks in different locations. An additional issue is the high initial cost
of establishing a wireless network that uses these technologies.
e)Other Wireless Technology Issues
Security of wireless information is another important technical issue
in m-commerce. Users and organizations will want assurance that their
wireless communications and transaction s are not intercepted.
Organizations that set up wireless LANs must realize that there are no
physical boundaries limiting their networks, and that people and devices
outside the organization may have (inadvertent) access to their systems.
Frequency hopping can make it more difficult to intercept data
communications. Encryption technologies can also help, but will need to
be made more efficient and more foolproof.
The increased use of wireless devices for e-commerce makes the
issue of positive identity verification even more important yet more
difficult to ensure. One consequence of this need is the increasing
importance of biometrics. Location technologies, especially the Global

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Positioning System (GPS), will also play a large part in wireless

communications. However, privacy issues must be addressed, such as
how personally-identifiable data and location data should be used.
f)Applications
Some of the applications of wireless technologies to e-commerce
activities that have started to appear across the globe are summarized
here. Many of these are currently constrained by technology limitations
and issues described previously. Two fundamental application issues that
researchers and developers must address are what tasks do users want to
do without regard for temporal or spatial constraints and how to provide
support for these tasks through wireless applications.
E-commerce payment systems can also benefit from wireless
technology. One scenario involves a consumer not having to stand in line
to make a purchase, but simply paying for an item though a wireless
device. Final payments might even be billed to a telephone company.
Bluetooth technology may enable a list of available services to be
generated automatically on a device when a user walks close to a
Bluetooth-equipped cash register.
Wireless technology is well suited for bringing e-commerce to
automobiles and other forms of transportation. Traffic advisory systems
can warn of impending traffic jams. Cars will eventually be able to report
potential problems to service centers themselves. The service center
might even make minor adjustments to the car online. Car-mounted
devices will eventually allow regular Internet access, although safety
issues of “browsing while driving” must be addressed. While most initial
mobile commerce applications seem to be aimed at the business-to-
consumer market, business-to-business and intranet applications are also
appearing.
Service technicians can be dynamically assigned new tasks and sent
problem information while they are traveling. Sales people can go literally
anywhere in the field and access product information and customer
accounts, although the applications right now are still subject to the
constraints of current wireless devices. Organizations must address the

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issue of designing complex, robust applications that work well within

these current (and any foreseeable) device limitations. Flexibility can be
integrated into designs to enable future functionality.
g)Global M-Commerce
The global use of wireless technologies and applications adds
another layer to the problems and issues in m-commerce. One important
issue is the current lack of standardization throughout the world. Mobile
phone standards vary from country to country and even within a country.
A global initiative for universal standards would foster greater growth in
m-commerce. A significant issue is the disparity in the adoption of
wireless technologies and applications in different regions of the world.
Japan will probably be the first to implement 3G technologies, followed by
Europe and the United States.
The primary reason for the U.S. lag is that the United States has not
had the same demand for increased mobile capacity as Europe and Japan.
Fewer Americans use wireless devices than individuals living in Asia or
Europe, and current American users exhibit lower usage rates than Asians
and Europeans. Therefore, the overall demand for 3G will be slower to
reach critical levels Wireless devices continue to change rapidly. While no
one is quite sure what the ultimate wireless device(s) will be, there is
definitely a need to ensure that devices can function with one another.
There is also the need for a truly global wireless communication
infrastructure with sufficiently high bandwidth to satisfy the needs of
wireless and m-commerce applications. The establishment of a wireless
infrastructure costs a great deal, and there will be many difficulties ahead
for the companies paving the way for m-commerce, but the long-term
prospects look good for the companies that survive.

UNIT - IV
4.1 HTML AND WEB DESIGNING
4.1.1 BRIEF HISTORY OF HTML

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 HTML stands for Hyper Text Markup Language

 An HTML file is a text file containing small markup tags
 The markup tags tell the Web browser how to display the page
 An HTML file must have an htm or html file extension
 An HTML file can be created using a simple text editor
 The <!DOCTYPE html> declaration defines this document to be
HTML
 The <html> element is the root element of an HTML page
 The <head> element contains meta information about the
document
 The <title> element specifies a title for the document
 The <body> element contains the visible page content
 The <h1> element defines a large heading
 The <p> element defines a paragraph

HTML Markup

HTML pages are created by tagging textual information with HTML

markup. HTML markup consists of tags, which appear inside angled
brackets < and > An example of an HTML tag is <B>, which causes text
to appear in bold. <B> only notes where text should begin to appear in
bold, while the tag </B> marks the end of the emboldening. Most HTML
tags have a corresponding end tag, which is specified by the name of the
tag preceded by the / character. So, to create the text:

Internet Commerce is great

<B>Internet Commerce is great!</B>

Another example of an HTML tag is <I>, which causes text to appear in
italic. In HTML 4.01, the <I> tag was used to render text in italics.
However, this is not necessarily the case with HTML5. Style sheets can be
used to format the text inside the <I> element. This will be demonstrated
later. Note that tags are not case-sensitive. In other words, <B> or <b>
are the same tag, both specifying bold text.
HTML Page Structure

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4.1.2 HTML TAGS

The most important tags in HTML are tags that define headings,
paragraphs and line breaks.

Headings
Headings are defined with the <h1> to <h6> tags. <h1> defines
the largest heading. <h6> defines the smallest heading.
<h1>This is a heading</h1>
<h2>This is a heading</h2>
<h3>This is a heading</h3>

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<h4>This is a heading</h4>
<h5>This is a heading</h5>
<h6>This is a heading</h6>
Paragraphs
Paragraphs are defined with the <p> tag.
<p>This is a paragraph</p>
<p>This is another paragraph</p>
HTML automatically adds an extra blank line before and after a paragraph.
Line Breaks
The <br> tag is used when you want to end a line, but don't want to start
a new paragraph. The <br> tag forces a line break wherever you place it.

<p>This <br> is a para<br>graph with line breaks</p>

The <br> tag is an empty tag. It has no closing tag.
Comments in HTML
The comment tag is used to insert a comment in the HTML source
code. A comment will be ignored by the browser. You can use comments
to explain your code, which can help you when you edit the source code
at a later date.
<!-- This is a comment -->
4.1.3 TABLE CREATION
Tables are defined with the <table> tag. A table is divided into rows
(with the <tr> tag), and each row is divided into data cells (with the <td>
tag). The letters td stands for "table data," which is the content of a data
cell. A data cell can contain text, images, lists, paragraphs, forms,
horizontal rules, tables, etc.

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Tables and the Border Attribute

If you do not specify a border attribute the table will be displayed
without any borders. Sometimes this can be useful, but most of the time,
you want the borders to show. To display a table with borders, you will
have to use the border attribute.
<table border="1">
<tr>
<td>Row 1, cell 1</td>
<td>Row 1, cell 2</td>
</tr>
</table>

Headings in a Table
Headings in a table are defined with the <th> tag.
<table border="1">
<tr>
<th>Heading</th>
<th>Another Heading</th>
</tr>

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<tr>
<td>row 1, cell 1</td>
<td>row 1, cell 2</td>
</tr>
<tr>
<td>row 2, cell 1</td>
<td>row 2, cell 2</td>
</tr>
</table>

4.1.4 HYPERLINK
HTML links are hyperlinks. You can click on a link and jump to
another document. When you move the mouse over a link, the mouse
arrow will turn into a little hand. Hypertext is text with hyperlinks. The text
that is linked from is called anchor text. A software system that is used for
viewing and creating hypertext is a hypertext system, and to create a
hyperlink is to hyperlink (or simply to link). A user following hyperlinks is
said to navigate or browse the hypertext.
Syntax

In HTML, links are defined with the <a> tag:

<a href="url">link text</a>
Example
<a href="[Link] our HTML tutorial</a>

4.1.5 REFERENCE
<a href="[Link] our HTML tutorial</a>

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4.1.6 HEADINGS
Headings are defined with the <h1> to <h6> tags.
<h1> defines the most important heading. <h6> defines the least
important heading.
<h1>Heading1</h1>
<h2>Heading2</h2>
<h3>Heading3</h3>
<h4>Heading4</h4>
<h5>Heading5</h5>
<h6>Heading 6</h6>
4.1.7 ALIGNMENT
 Open your HTML document. Double-click the HTML document to
open it in your computer's default text (or HTML) editor.
 Find the text you want to center. Scroll down until you find the
header, paragraph, or other text that you want to center.
 Add the "center" tag to each side of the text. ...
 Review your HTML document.
Example

<p align="center">This is some text in a paragraph.</p>

4.1.8 SIMPLE WEB PAGE CREATION
If you are running Windows, start [Link] in the following text:
<html>
<head>
<title>Title of page</title>
</head>
<body>
This is my first homepage. <b>This text is bold</b>
</body>
</html>

Save the file as "[Link]". Start your Internet browser. Select

"Open" (or "Open Page") in the File menu of your browser. A dialog box
will appear. Select "Browse" (or "Choose File") and locate the HTML file

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you just created - "[Link]" - select it and click "Open". Now you
should see an address in the dialog box, for example
"C:\MyDocuments\[Link]". Click OK, and the browser will display the
page.

UNIT - V
5.1 E-MAIL

5.1.1 E-MAIL

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E-mail is short for electronic mail, mail you can send or receive
directly on your computer. Yes, with e-mail people can actually write you
letters and send them to your computer, and you can turn on your
computer and go pick up your mail whenever it's convenient. Many a love
affair has begun through e-mail. I know. It's really fun, too. And useful, of
course. E-mail can be a verb too, as in "I e-mailed my lover a letter from
Lhasa."

Although basically a method of passing messages from one

computer to another email is becoming increasingly popular, in part
because those computers sending messages to each other could be in
adjacent offices or on opposite sides of the world. In fact the ability to
send a letter or memo halfway across the world at the speed of electricity
instead of the more traditional postal services is one of the strengths of
the Internet. Because of email even the remotest office can maintain
practically instant communication with headquarters, or even another
remote office.

E-mail may not be as personal as a handwritten note, but it's the quickest
and most convenient way yet to communicate written information. If
something absolutely positively has to be there in ten minutes, e-mail can
get it there on time. I write for magazines and corporations all over the
country, but I never leave my room. If an article has to be in by Friday at
noon, I can finish it Friday at 11:45 and e-mail the computer file to New
York before the deadline.

E-mail is also great for taking care of business without having to go

through all the social pleasantries we endure in phone conversations you
can get straight to the point without having to ask how the kids are doing.
"Attached is the file on the DeVere controversy. Tell me what you think."
Contrast e-mail with snailmail.

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To send or receive e-mail, you must have a modem or your

computer has to be on a network (connected to other computers). Your
company or organization may have its own e-mail system with its own
software-in which case you'll run a version of that software on your
machine. Lotus' CC:Mail is probably still the most popular e-mail software
around for PCs. Alternatively, e-mail services are available on
many bulletin boards and online services) and there are specialized
services such as MCI Mail whose primary mission is to distribute e-mail.
5.1.2 EMAIL COMPONENTS
E-mail message comprises of different components: E-mail Header,
Greeting, Text, and Signature. These components are described in the
following diagram

E-mail Header

The first five lines of an E-mail message is called E-mail

header. The header part comprises of following fields:
 From
 Date
 To

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 Subject
 CC
 BCC
FROM

The From field indicates the sender’s address i.e. who sent the e-mail.

DATE

The Date field indicates the date when the e-mail was sent.

TO

The To field indicates the recipient’s address i.e. to whom the e-mail is
sent.

SUBJECT

The Subject field indicates the purpose of e-mail. It should be precise and
to the point.

CC

CC stands for Carbon copy. It includes those recipient addresses whom we

want to keep informed but not exactly the intended recipient.

BCC

BCC stands for Black Carbon Copy. It is used when we do not want one or
more of the recipients to know that someone else was copied on the
message.

GREETING

Greeting is the opening of the actual message. Eg. Hi Sir or Hi Guys etc.

TEXT

It represents the actual content of the message.

SIGNATURE

This is the final part of an e-mail message. It includes Name of Sender,

Address, and Contact Number.

5.1.3 USE OF EMAIL

E-mail has prooved to be powerful and reliable medium of
commmunication. Here are the benefits of E-mail.

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Reliable

Many of the mail systems notify the sender if e-mail message was
undeliverable.

Convenience

There is no requirement of stationary and stamps. One does not

have to go to post office. But all these things are not required for sending
or receiving an mail.

Speed

E-mail is very fast. However, the speed also depends upon the
underlying network.

Inexpensive

The cost of sending e-mail is very low.

Printable

It is easy to obtain a hardcopy of an e-mail. Also an electronic copy

of an e-mail can also be saved for records.

Global

E-mail can be sent and received by a person sitting across the

globe.

Generality. It is also possible to send graphics, programs and

sounds with an e-mail.

5.1.4 EMAIL CREATION

 Visit Create your Google Account for Gmail.
 Enter your first and last name in the Name section.
 Type your desired username under Choose your username.
 Your Gmail email address will be your username followed by
"@[Link]." If your Gmail username is "example," for instance,
your Gmail address is "example@[Link]."
 Enter a password for your Gmail account under both Create a
passwordand Confirm your password. Pick an email password
that is difficult to guess.

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 For enhanced security, you should later enable two-factor

authenticationfor your Gmail account.
 Click Next.

You are asked to verify your phone number. You can skip this step if
you prefer.

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 Enter your mobile phone number and an alternate email

address for account verification and authorization. Google uses this
information to protect your privacy and to allow you to recover a
lost password.
 Enter your birth date and gender in the fields provided.
 Click Next

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Read and the Privacy and Terms and then click I Agree to continue.

That's it. You're done. Once you click I Agree you're taken to the My
Account page for the email address you just created. From there, you can

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sign into your account, manage your personal information, and set your
account preferences.

5.1.5 BROWSING
Browsing is a quick examination of the relevance of a number of
objects which may or may not lead to a closer examination or
acquisition/selection of (some of) these objects. It is a kind
of orienting strategy that is formed by our “theories,” expectations and
subjectivity".
A web browser is a software program that allows a user to locate,
access, and display web pages. Browsers are used primarily for
displaying and accessing websites on the internet, as well as other
content created using languages such as Hypertext Markup Language
(HTML) and Extensible Markup Language (XML).

The most popular web browsers that are used today are Mozilla
Firefox, Google Chrome, Microsoft Internet Explorer, Apple Safari and the
Opera browser. ... These files, or web pages as they're commonly known,
are pulled from the web server and then translated by the
web browser for the user to view.
5.1.6 SEARCH ENGINES
A web search engine is a software system that is designed to search
for information on the World Wide Web. The search results are generally
presented in a line of results, often referred to as search engine results
pages (SERPs). The information may be a mix of web pages, images and
other types of files. Some search engines also mine data available
in databases or open directories. Unlike web directories, which are
maintained only by human editors, search engines also maintain real-
time information by running an algorithm on a web crawler. Internet
content that is not capable of being searched by a web search engine is
generally described as the deep web.

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It is a database or website which contains links to all web pages on

the Internet which help in search of information. Example is google.
com, [Link] and [Link]. A search engine refers to a web software
used to search for information on the internet using keywords.

5.1.7 DOWNLOADS

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In computer networks, to download (abbreviation DL) is to

receive data from a remote system, typically a server such as a web
server, an FTP server, an email server, or other similar systems. This
contrasts with uploading, where data is sent to a remote server.
A download is a file offered for downloading or that has been downloaded,
or the process of receiving such a file.

Downloading generally transfers entire files for local storage and

later use, as contrasted with streaming, where the data is used nearly
immediately, while the transmission is still in progress, and which may not
be stored long-term. Websites that offer streaming media or media
displayed in-browser, such as YouTube, increasingly place restrictions on
the ability of users to save these materials to their computers after they
have been received. Downloading is not the same as data transfer;
moving or copying data between two storage devices would be data
transfer, but receiving data from the Internet is downloading.

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MODEL QUESTION PAPERS

II BSC (BT)
Fourth semester
Ecommerce
Time : Three hours Maximum : 75
marks
Part – A - ( 10 X 2 = 20 )
Answer ALL questions
1. Define E-Commerce.
2. What are the Transition to E-Commerce in India?
3. Define Networks and Internets with Example.
4. Write the E-advertising?
5. Define E-advertising.
6. What are the Cyber stalking?
7. What are the Skimming?
8. Define e-Payment Systems
9. Define Designing e-payment Systems
10. Define Cellular Network.

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Part – B - ( 5 X 5 = 25 )
Answer ALL questions
11.a). Explain about the Transition to E-Commerce in India–The Internet.
(OR)
b).Write about India–E-transition Challenges for Indian Corporate.
12.a). Explain the Internets–Software Agents Internet Standards
(OR)
b). Explain about the and Specifications–ISP. e-Marketing.
13.a). Explain the Information Security Environment in India.
(OR)
b). Explain how to protect Legal and Ethical Issues Functional
Dependency.
14.a). Explain about properties of Electronic Cash Cheque Payment
Systems on the Internet–Risk
(OR)
b). Write about and e-Payment Systems
15.a).Explain about how to initialize Cellular Network
(OR)
b).Explain the following –Wireless Spectrum

Part-C - ( 3 X 10 = 30 )
Answer any three questions
16. Explain briefly about Business Model–E-business Models Based on the
Relationship of Transaction Parties.
17. Explain the Internet Client-Server Applications with examples
18. Describe Privacy is at Risk in the Internet Age briefly.
19. Explain the Designing e-payment Systems with Examples.
20. Explain about the Security Issues Pertaining to Cellular Technology in
detail.

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OBJECTIVE TEST
E-COMMERCE TECHNIQUE
1. Which of the following is not a building block in the infrastructure of e-commerce? a) Common
business services b) Messaging and information distribution
c) Public policy d) Situational standards
2. …... is a mesh of interconnected data highways of many forms.
a) Computer b) I- way C) E-commerce d) Business service
3. …………….. is the use of digital data in more than one format such combination of text, audio,
video, graphics in computer file.
a) Multimedia b) Digitalization
c) Media serving d) Information delivery
4. Which of the following is not an application of e-commerce?
a) Multimedia storage servers b) Consumer access devices
c) Electronic commerce d) Global interference
5. Which of the following is not included in electronic commerce applications related to digital
video?
a) Telecommunicating and video conferencing
b) Corporate multimedia servers
c) Video-on-demand d) Postproduction studios
6. Which of the following is not an information delivery method?

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a) Long distance telephones lines b) Cable TV-coaxial

c) Cellular and radio networks d) Wireless communications
7. Expansion of EDI………….
a) Electronic data information b) electronic data interchange
c) Electrical data information d) electronic direct interchange
8. ………….. viewed as an integrated management system consisting of a number of different
management practices dependent on the characteristics of specific plants
a) Just –in- time manufacturing b) quick response retailing
c) Channel management d) supply chain management
9. ……………. the goal is to shorten the order-ship-bill cycle. When a majority of partners are
electronically linked, information faxed or mailed
a) Channel management b) inventory management
c) Sales production d) payment management
10 …………… the goal is to improve the communication flow of information among the sales,
customer & production functions
a) Channel management b) distribution management
c) Sales force productivity d) payment management

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