Chapter 5 The Internet and Electronic Commerce The McGraw-Hill Companies, Inc. 2002. All rights reserved. Irwin/McGraw- Hill
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Chapter 5
The Internet and Electronic Commerce
The McGraw-Hill Companies, Inc. 2002. All rights reserved. Irwin/McGraw-Hill
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Chapter Objectives
• To understand the basic building blocks of Internet technologies.
• To determine how widespread the implementation and expansion of the Internet is.
• To appreciate the tremendous potential for business applications of Internet technologies.
• To understand some of the major issues raised by use of the Internet.
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Evolution of the Internet
• The Internet has been defined as – A network of networks.– Loose collection of related computer networks.
• World Wide Web– Is a subset of the Internet. – Accessed through Web browsers.– Email– Usenet
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General Framework Electronic Commerce
Level 5 Electronic commerce applications
Level 4 Common business services infrastructure
Level 3 Messaging and information distribution
Level 2 Multimedia content
Level 1 Public Policy: Legal and Privacy
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Date Number of Domains
August-81 231
August-83 562
October-85 1,961
December-87 28,174
October-89 159,000
October-91 617,000
October-93 2,056,000
July-95 6,642,000
July-97 19,540,000
July-99 56,218,000
January-01 109,574,429
Growth of the Internet
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Evolution of the Internet
• ARPANet – Advanced Research Projects Agency– US Defense Department.– Scientists, military personnel, and researchers.
• MILNet – Military personnel
• Bitnet – National Science Foundation
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Service Providers
• Internet Service Provider– Pay a flat fee to connect to the Internet.
– Charge subscribers a subscription fee.
– America Online, CompuServe, MSN.
• On-line Service Provider– Offer additional service in addition to Internet access.
• Wireless Service Provider– Companies that offer wireless access to the Internet.
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Internet Building Blocks
• Internet addressing– URL – uniform resource locator
• Protocol://domain-name:port/directory/filename• http://www.rei.com/rei/help/orderhelp.html• http://www.rei.com/rei/gearshop/index.jsp• ftp://ftp.company.com• http – hypertext transfer protocol• ftp – file transfer protocol
– IP Address• 152.17.101.11
– Domain Name System, translates the URL into an IP address.– Domain Name suffixes (.edu, com, .gov, .biz, .name).
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Five Waves of Internet Technology & Use
1. Department of Defense funding Research Applications
2. Academic Use
3. Web and Web browsers
4. Telecommunications infrastructure
5. Mobile Internet platforms
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Internet Applications
• Email, message is composed and transmitted electronically– Listservs, distribute messages to individuals with
common interests.
• Newsgroups, forum for electronic discussion.• Telnet, allows access to other computers
connected to the Internet.• FTP, file transfer protocol allows files to be
transferred from a host site to your computer.
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Internet Applications
• World Wide Web (WWW) is a subset of the Internet used to store and retrieve hypertext and hypermedia files.– HTML, hypertext markup language is a set of tags that
markup documents to be viewed in a web browser.– A web browser is a software program that is used to
view web pages (Netscape Navigator, Microsoft Internet Explorer).
– A web server is hardware and software used to store web pages (IIS, Apache)
– Figure 5.6
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Due to the limitations of HTML:
• Java was introduced in 1995.– Sun Microsystems– Object Oriented Programming Language – Applets add animation
• XML, eXtensible Markup Language was created in 1998 by the W3C.– XML is a set of rules used to create a markup language.– Rules ensure that the parser can process new language.– Adds meaning to documents.– Uses extensible style sheets.
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Dynamic Web Pages
• A database management system can help generate content for web pages.– Checking the price of a book on Amazon.com.– Personalized web pages.
• Tools to create dynamic web pages.– VBScript with Active Server Pages.– Internet Information Server.
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Search Engines
• A search engine is designed to locate other pages (Yahoo, Google).
1. A spider, crawler, or bot are used to search the web.
2. Index, stores everything found in step 1.
3. Search engine utility returns a list of web pages that match the original request.
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Intelligent Agents & Web Portals
• An Intelligent agent is a software program that performs some action on behalf of a person or other entity.
• A web portal is a customizable window on the web for individual users.
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Business Opportunities
• Business-to-consumer
• Consumer-based markets
• Business-to-business
• Business-based markets
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Business-to-consumer
• Most visible form of E-commerce, associated first with the term E-commerce.
• Internet based transactions involving the exchange of goods or services for money.
• Also includes non-commercial applications.• Clicks-and-mortar – Wal-mart & ToysRUs.• Cookies are files used to store information
on the customers computer --Amazon.com.
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Consumer-based markets
• A consumer-based market is an online market for consumers, analogous to a farmers market.
• A group of individual get together online an offer their product or service.
• Other individuals bid on those products or services.
• Examples include eBay and Amazon.
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Business-to-business
• Business-to-business commerce is an online relationship between businesses.– Larger than the Business-to-consumer markets.– Relationships can be categorized as:
• Transactional
• Contractual
• Partnership
– EDI
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Business-based markets
• A business-based market is an online market for businesses.
• Suppliers supply products or services to bid on.
• Participants bid on those products or services.
• Markets may use fixed or negotiable pricing.• Requirements, PC and Internet connection.
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The Mobile Internet
• Accessing the Internet through mobile devices such as PDAs, Cell Phones, and Laptop computers.
• Challenges to the Mobile Internet– Physical limitations (bandwidth).– Protocol compatibility problems with HTML.– Technical capabilities of mobile devices.
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Internet Issues
• Security– Hackers may attempt to gain access to a
vulnerable computer.– Hackers don’t have to gain access to cause
damage, denial-of-service attacks.– Sniffer programs allow hackers to monitor
activity on a network.– Pagejacking refers to a scheme to disrupt a
website.
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Internet Issues
• Privacy– Profiling is used to understand customer preferences
and interests.
• Consumer Protection– Off-shore casinos – Online scams
• Censorship– Who determines obscene or undesirable?
• Intellectual property rights
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