CHAPTER 1

Learning outcomes 1
Introduction 2
The growth of Internet commerce 2
Definitions of electronic commerce and Internet commerce 4
Web browsers, Internet commerce and security 5
Uniform resource locators and business significance 6
The growth of commercial domain names 7
History of electronic commerce 7
Business revolution and Internet commerce 8
The theory of creative destruction 8
The digital economy 9
M-commerce 10
Types of electronic commerce 11
Business-to-consumer (B2C) 12
Business-to-business (B2B) 12
Business-to-government (B2G) 12
Consumer-to-consumer (C2C) 13
Consumer-to-business (C2B) 13
Government-to-government (G2G) 13
Government-to-business (G2B), government-to-consumer (G2C) and consumer-to-government (C2G) 14
What the Internet means for businesses in Australia 14
Strategic competitive advantage 14
Managers need to be aware of the potential 15
Possible risks in Internet commerce 16
Security issues 16
Shopping experience issues 17
Micropayments or microtransactions issues 17
Lack of standards issues 17
Lack of bandwidth 17
Stakeholders in Internet commerce 19
Information systems and Internet commerce 19
Electronic commerce as a management tool 20
Summary 21
Key terms 21
Case study 1 InterNIC FAQS on new top-level domains 22
Case study 2 Satellite technology will train country doctors 24
Questions 25
Suggested reading 26
End notes 26

CHAPTER 2

Learning outcomes 28
Introduction 29
Business models 29
Fundamental models 30
Online Yellow Pages model 30
Subscription model 31
Advertising model 31
The 3.5.7 model 32
Auction and Reverse Auction models 33
Affiliation model 33
Portal model 34
Buy/sell fulfilment models 34
Virtual Storefront model 34
eProcurement model 35
e-Marketplace models 35
Procurement Marketplace model 35
Vertical Marketplace model 35
Horizontal Marketplace model 36
Peer-to-Peer Networking model 36
Strategic planning: implementing the business models 37
Planning 37
Controlling 37
Monitoring 38
Adjusting 38
Managing quality 38
Using the Online Yellow Pages model 39
Using the virtual storefront model 39
Using the vertical marketplace model 40
Peer-to-Peer networking: from MP3 to B2P 42
Applications of P2P and B2P 43
Secrets of success 44
Summary 44
Key terms 44
Case study Royal & SunAlliance insurance group's online business model 45
Questions 49
Suggested reading 49
End notes 49

CHAPTER 3

Learning outcomes 51
Introduction 52
All the nets 52
The Internet 52
Intranets 52
Extranets 53
How the Internet works 54
Telecommunication infrastructure of the Internet 55
What is a protocol? 56
The Web 59
Why has the Web become so popular? 65
Protocols 65
Affordable hardware, software and telecommunication links 65
User-friendly interface 65
Content development 66
Search engines 66
High number of connected businesses and consumers 69
Security 69
Business technologies for the Web 70
Databases 71
Client-server architecture 71
New programming languages for the Internet 72
Multimedia manipulation 73
Transmitting voice traffic 74
Summary 75
Key terms 75
Case study Barunga Music online 76
Questions 81
Suggested reading 81
End notes 82

CHAPTER 4

Learning outcomes 83
Introduction 84
The new five P's 84
Paradox 84
Perspective 86
Paradigm 86
Persuasion 87
Passion 87
Creating a commercial web site 88
Planning 88
Organising 89
Controlling 90
Monitoring results 90
Creating a commercial web site quickly 90
Internet commerce technology review 91
Different methodologies for developing an e-commerce
web site 93
Going online 93
E-commerce software overview 95
Electronic shopping agents 96
Building an Internet commerce community 96
Internet banking 96
Service-selling sites 97
Online publishing 97
B2B transactions 98
Summary 98
Key terms 98
Case study The adoption of e-commerce by microbusinesses 99
Questions 102
Suggested reading 103
End notes 103

CHAPTER 5

Learning outcomes 105
Introduction 106
Electronic payment systems 106
From traditional payment methods to EPS 106
B2C electronic payment systems 108
Credit cards on the Internet 109
EFTPOS 111
Electronic cheques 112
Electronic wallets 113
Web services 114
Digital cash 114
Other digital currency products 116
Smart cards (stored value cards) 118
B2B electronic payment systems 123
Electronic funds transfer and EFTPOS 123
Electronic data interchange 123
Summary 130
Key terms 130
Case study The automatic identification trajectory 131
Questions 135
Suggested reading 135
End notes 135

CHAPTER 6

Learning outcomes 137
Introduction 138
Internet commerce security concerns 138
Security issues in networks running electronic commerce applications 140
Confidentiality of data 141
Integrity of data 142
Viruses 143
Security management for Internet commerce 145
Availability issues 145
Authentication issues 146
Non-repudiation issues 149
Addressing security issues in electronic commerce 149
IT audits 149
Server security, firewalls and proxies 152
Summary 155
Key terms 156
Case study The battle against security attacks 156
Questions 160
Suggested reading 160
End notes 161
Learning outcomes 163
Introduction 164
Defining the Internet customer 164
Just who is the Internet customer? 165
Reaching Internet customers 166
Advertising to reach customers 167
Satisfying customer needs 168
Consumer activities online 169
Customer relations 170
Database marketing strategies 173
Customer security 174
Summary 175
Key terms 175
Case study Integrating islands of information through CRM 176
Questions 180
Suggested reading 180
End notes 180

CHAPTER 7

Learning outcomes 182
Introduction 183
How the Internet is changing organisational communication 183
The new publishing paradigm 183
The Internet and work 185
Just-in-time information 186
Organisational issues 187
Intra-organisational communication 188
Email 188
Intranets 190
Organisational knowledge management 192
Using graphical browsers as front-end interfaces 192
Extra-organisational communication 193
The supply chain 193
Recruiting employees 195
Enterprise resource planning systems 196
Customer relationship management 197
The human factor 198
Global communication issues 199
Summary 201
Key terms 201
Case study Organisational communication: will it be improved by adopting information technology? 202
Questions 205
Suggested reading 206
End notes 206

CHAPTER 8

Learning outcomes 208
Introduction 209
Background history 210
Australian business Internet usage 211
Australian household Internet usage 212
International progress in Internet commerce 213
Barriers to e-commerce 214
Australia and taxation 216
Tax implications of Internet commerce 216
Taxes on Internet purchases and income generated by Internet purchases 217
Businesses 217
Consumers 218
Digitised goods 220
Internet gambling 220
International response to Internet commerce: a review 222
US response 223
Canada's response 225
History of Europe's response 225
The OECD's response 227
Ireland's approach to tax and electronic commerce 228
Japan's response 229
International cooperation in dealing with taxing Internet commerce 229
The role of cypherpunks 230
Electronic tax pack 231
Online banking and taxation issues 231
Building trust with customers purchasing over the Internet 231
Summary 234
Key terms 234
Case study E-tax for Australian individuals lodging income tax returns 235
Questions 238
Suggested reading 238
End notes 239

CHAPTER 9

Learning outcomes 242
Introduction 243
Control of Internet content 243
Intellectual property 245
Copyright 245
Patents 246
Trademarks 247
Domain names 248
Jurisdiction 249
Defamation 250
The contract 251
Advertising 253
Security and cybercrime 254
Privacy and email 255
Ethics 257
Summary 258
Key terms 258
Case study The online privacy frontier 259
Questions 263
Suggested reading 264
End notes 264

CHAPTER 10

Learning outcomes 266
Introduction 267
Dot.com industry 269
The infomediary 270
Portals 271
Auctions and reverse auctions 272
E-marketplaces 273
Knowledge exchanges 274
Value trust networks 274
A virtual private network 275
Enterprise information portals 276
XML 278
Mobile commerce (m-commerce) 279
Network technologies 279
Service technologies 280
M-commerce location technology 281
The future of m-commerce 281
Bluetooth 282
Peer-to-Peer computing 282
The role of government 283
The Business Entry Point - An Australian government initiative 284
United States and e-commerce 285
Disintermediation and reintermediation 286
Outsourcing 287
Disintermediation 287
Reintermediation 288
Internet2 288
Emerging technologies 289
Summary 290
Key terms 290
Case study The rise of the wireless Internet 291
Questions 294
Suggested reading 294
End notes 295

APPENDIX 1: Web sites listed by chapter 297

APPENDIX 2: Web sites listed by industry sector 303

GLOSSARY 309

INDEX 325