M-Commerce and its features

M-Commerce and its features Abstract: Purpose of this article is to elaborate the concept of electronic commerce and its red hot issue, mobile commerce. In this article I define E-commerce as: Electronic exchange of goods or services using electronic means. I also discuss the categorization of electronic commerce on the basis of parties involved in trade. Then I discuss the need for e- commerce that why traders moves toward e-commerce from old traditional means of trading. I also discuss the payment criteria while using e-commerce. Moving toward M-commerce, this article will discuss the core elements of m-commerce. It also includes evolution of m-commerce and the technologies used in m-commerce. This article will also discuss the applications and features provided by m-commerce and also include the payment criteria while using m-commerce technology. As all the activities of e-commerce and m-commerce are held electronically where buyers and sellers does not know each other, therefore, trust should be promoted between buyers and sellers. This article also explains that what is a need of building trust and how it can be created. Introduction of E-Commerce E-commerce is defined as, the trading or information sharing using electronic means is called E-commerce. E-commerce is the exchange of information, goods, services and payments over communicational devices. It is further defined as online shopping on internet. E-commerce is about electronically exchanging business information of which product descriptions are just one element. [1] With the evolution of internet, world is turned into a global village. Therefore, trade is expanding without the concept of boundaries. Internet helps the buyers and sellers to provide them a place where they can trade with each other. Buyers and sellers might not 1

know each other as well as never meet each other but they can perform a transaction. It is helpful for both buyers and sellers as it helps out to find them the best price for both buyers and sellers and can reduce the process cost. E-commerce not only includes online shopping, it also includes electronic actions, online banking and online stock trading. E-commerce includes physical transfer of different products, digital products and also services. Physical products are sent to customer when they made online payment involving the banks. Digital products can be called intangible products as they are transformed into bytes and transfer using electronic means. Services are also provided online to the customer. Distance education, arranging trips and providing consulting services are the good example of services provided online.[2] Categories of electronic commerce: E-commerce can be categorized into following kinds: B2B (Business to Business Commerce) B2C (Business to Customers Commerce) C2C (Customers to Customers Commerce) Business to Business Commerce (B2B): It includes horizontal commerce between businesses to business. It includes manufacturers, wholesalers and retailers. Business to Customers Commerce (B2C): This type of commerce involves manufacturers, wholesalers, retailers and customers. This type of commerce is very important as it include customers in the system, therefore, customers should be facilitated with the best available products and services. Customers to Customers Commerce (C2C): Customers to customer s commerce include transactions takes place among the customers of different segmentations. [3] 2

Need for E-commerce: With the evolution of internet, world becomes global village. Demand and supply for different products are increased to a large extent, therefore, a local producer or trader cannot fulfill the demand or supply. Traders go for import and export to fulfill the gap between demand and supply. Old traditional methods for import and export are time consuming and due to high risk factor cannot involve individuals in foreign trade. With the evolution of E-commerce, trade has been revolutionized. As it contain less risk factor, therefore, it attracts the individual for online shopping, online banking and online stock trading. E-commerce not only includes distance trading, (i.e.: import and export) but it also include less distance trading but using electronic means. Payment mechanism in E-Commerce: Payment mechanism on electronic commerce is very simple and gave ease of use to the customers. It saves customers to keep cash with them. Instead E-Commerce offers customers to use plastic money which is more convenient and easy to use. Debit and Credit cards are known as plastic money and the new concept of electronic wallet is also introduced by the traders by which buyers can make online payment using electronic means. Online making payment method is not very common in our country as people does not feel online payment a secure one, therefore, there is a need to guide users and encourage them to use electronic means. Concept of Mobile Commerce in Electronic Commerce: With the advancement of telecommunication technology, concept of mobile commerce is evolving very fast. Traders are rapidly moving toward mobile commerce as it is fast, convenient and economical for both buyers and sellers. Mobile Commerce: As mobile technology is growing very fast, traders decide to make mobile devices their part of business in order to update their customer and to facilitate them. 3

Mobile e-commerce (also called mobile commerce or m-commerce) is defined as all activities related to a (potential) commercial transaction conducted through communications networks that interface with wireless (or mobile) devices. [4] M-commerce is the name of involving portable devices into business activity in order to facilitate both buyers and sellers. With the growing trend of using portable devices in trade, it can be expect that mobile or portable devices will become important part of the trade. Portable or mobile devices can be explain as, the devices using wireless technology and can navigate easily are known as portable or mobile devices. There are different kinds of mobile or portable devices; some of them are listed below; Wireless phones. Mobile phones Handheld computers. Personal digital assistance. These devices are commonly used in M-commerce and other portable devices can also be used in M-commerce. These devices use wireless technology that can be a part of any wired network or wireless network.[4] History of Mobile Commerce: Mobile commerce was started in 1997 when one famous beverage company Coca Cola. They introduced a payment mechanism using SMS services. In 1997 one bank in Finland banking services based on mobile phones. In 1999, a platform for m-commerce was launched with the introduction of m-payment concept (payment using mobile phones). First conference to promote m-commerce was held in London in 2001. Cellular phones and PDAs were widely used because they were the cheaper and easier way to communicate between buyers and sellers. With the advancement of cellular phones, m-commerce technology is also improved and now it provides better applications than only SMS. With the launch of Blackberry and iphone, traders are providing more functions regarding m-commerce because these cellular phones provide variety of functions to the customers. 4

Technology used in M-commerce: Mobile commerce issues can be categorized into two major parts; Mobile users. Infrastructure used in communication. Mobile users; Mobile users are the clients or users that use mobile devices for trade purpose. Infrastructure used in communication; Infrastructure used in wireless communication is very complex. Its technology can use different networks from the following. Wireless local area network (W-LAN) Wireless telecommunication. Wireless telecommunication network further consist of different technologies. TDMA GSM CDMA EDGE GPRS Old wireless technology was consists of second generation technology (2G) which is now converted into third generation technology (3G). 3G technologies provide better services to users than 2G technology. 3G technology is also called Universal Mobile Telecommunication System (UMTS). 3G technology is comparatively expensive than 2G technology but it provides variety of features to the users. While launching a 3G technology, mobility was the important feature for the manufacturer because mobile devices can lost network and the process of trading stop, therefore, 3G technology was designed fit for the mobile trade using portable devices. Secrecy was also the important issue in mobile commerce, because wireless technology is based on unguided technology, therefore, there is a possibility of misuse of information. 5

When 3G technology was designed, secrecy was given priority to attract the customers to encourage them to use mobile devices for mobile commerce. Virus attack was the greatest threat for mobile commerce as viruses harshly affects the wireless technology due to their unguided network, so 3G technologies was designed, keeping virus attacks in mind User identity verification was one of the important issues in mobile commerce. As mobile commerce provides ease to users to trade from anywhere but it also increases the chances of misusing this technology, therefore, user identity verification was improved in 3G technology. Wireless Access Protocol: Wireless access protocol is a browser which enables users to access internet directly from their mobile devices, such as cellular phones and PDAs. This browser i8s restricted to the processing speed and display size of the mobile devices.[5] Wireless Application Protocol: Wireless application protocol is the technologies and protocol or rules that how mobile devices will access to the internet. Applications of Mobile Commerce: There is vast field of applications of mobile commerce which are used in almost every aspect of life. Some of the commonly used applications are described below; Providing financial services. Advertisement of the products. Control over inventory. Online shopping. Identify the product location. Auction and bidding. Entertainment purpose. Information sharing. 6

Providing services. Wireless technology enables users to use above and other activities from anywhere and anytime. Wireless technology surely saves time, reduces cost and provides the best option available. Traders are providing these applications on the mobile devices of the users which was not possible in past. Traders provide that application in very simple and clear format which can easily be used by the customers. Traders assure users to provide best product and assure them that their money which they paid electronically is secure. Transactions in mobile commerce requires compete account information of the customers, in starting, customers hesitate to provide their personal account information online to the sellers but now with the proper acknowledgment sellers has reduces the doubts and develop trust among buyers and sellers and now buyers normally easily provides account information to the authenticate seller. Revenue generating is also taking place in mobile commerce, mobile betting and gambling is also offered in the application of entertainment. Hence mobile commerce is also working for revenue generating.[6, 7] Facilities available in M-commerce: Different facilities in shape of products and services are available in M-commerce as described below. Facility of M-Ticketing: M-commerce provides a facility of mobile ticketing in which seats are reserved using mobile devices. It also provides a silent feature that mobile phone work as a passenger coupon. Users show their cell phone to the representative of the airline or railway and can get the printed passenger coupon. Facility of M-vouchers: Mobile phones can work as vouchers and loyalty cards for the customer. Mobile ticketing technology is used in M-vouchers as virtual vouchers are sent on mobile phones which a customer can show to any point of sale and can enjoy the benefits for these vouchers and loyalty cards. 7

Facility to purchase mobile contents and their delivery: M-commerce enables customers to purchase mobile phone contents from web using their mobile phones. Mobile phone contents contain ring tones, games, themes and songs. With the emergence of different features in mobile phones like mp3 player and video players it is very convenient for the customers to download their features with more mobility and with more ease. Services on the basis of location: M-commerce provides services to its customers on the basis of their location. It enables the customers to keep in touch with the latest information. Services provided on location basis are discussed below. Tracking information. Local offers in locality. Weather information on the basis of location. Facility to provide information services: M-commerce facilitate its customers by providing them informative services which keep them up to date. The informative services provided to the customers are as under: News. Sports data. Financial analysis. Stock trading information. Prayers timing. Traffic information. M-banking: M-commerce also provides M-Banking (Mobile Banking) facility to their customers. User can operate their accounts, transfer money and can inquire about their account balance. Users can purchase items using M-banking facility. 8

M-Browsing: M-commerce provides browsing facility to their customers on their mobile phones by providing them a facility of GPRS. Payment method in M-Commerce: Mobile commerce is the trade using mobile devices hence the payment is also made through the mobile devices. Payment using mobile devices contains high risk factor. Payments are made through Credit and Debit cards by giving personal verification information with card number to the buyers. New concept of Easy Paisa is introduced in Pakistan which enables customers to send and receive money over long distance. Banking facilities are also provided by different banks which enable customers to operate their accounts using their mobile devices.[8] Developing trust in buyers: In E-commerce or M-commerce, buyers and sellers does not know each other and never meet each other, therefore, there is a need to develop a trust among buyers and sellers to encourage buyers and sellers to trade online. Unless trust is not developing between buyers and sellers, they feel the online transaction a risky one and not go for online trading. Without developing trust among buyers and sellers, E-commerce or M- commerce is not possible. Buyers hesitate to give their information online because there are many fake websites who deceive buyers and break their trust. Without a model of how trust operates in this context, it is difficult to build up valid and reliable methodological knowledge about the way trustworthiness can be communicated in e-commerce system design. [9-11] Limitation in Mobile Commerce: As mobile commerce is based on the mobile devices like cellular phones and PDAs, their processing speed and compatibility is very slow, therefore, we cannot use a concept of M-Commerce for broader terms. 9

Privacy and secrecy are also the limitations of M-Commerce because proper identity verification is not possible and these mobile devices are using wireless technology which is unguided technology; therefore, personal information can be stealing by the hackers. Conclusion: Mobile commerce became the hottest issue in the field of electronic commerce. Buyers and sellers are shifting toward mobile commerce by giving up the old traditional methods of trade which save their time and money and also give them ease of use different facilities from anywhere. It is suggested that privacy and security should be promote in order to protect the personal information of the buyers. References: 1. Fensel, D., et al., Product data integration in B2B e-commerce. IEEE intelligent systems, 2001. 16(4): p. 54-59. 2. Gefen, D., E-commerce: the role of familiarity and trust. Omega, 2000. 28(6): p. 725-737. 3. Deitel, H., P. Deitel, and T. Nieto, e-business & e-commerce: how to program. 2001: Prentice Hall. 4. Tarasewich, P., R. Nickerson, and M. Warkentin, Issues in mobile e-commerce. Communications of the Association for Information Systems (Volume 8, 2002). 41(64): p. 41. 5. Senn, J., The emergence of m-commerce. Computer, 2000. 33(12): p. 148-150. 6. Varshney, U. and R. Vetter, Mobile commerce: framework, applications and networking support. Mobile Networks and Applications, 2002. 7(3): p. 185-198. 7. Functionalities, T., BUILDING E-COMMERCE APPLICATIONS AND INFRASTRUCTURE. 8. Fünfrocken, S., Protecting mobile web-commerce agents with smartcards. Autonomous Agents and Multi-Agent Systems, 2001. 4(4): p. 339-358. 9. Ackerman, M., L. Cranor, and J. Reagle. Privacy in e-commerce: examining user scenarios and privacy preferences. 1999: ACM. 10. Egger, F. Trust me, I'm an online vendor: towards a model of trust for e- commerce system design. 2000: ACM. 11. McKnight, D. and N. Chervany, What trust means in e-commerce customer relationships: an interdisciplinary conceptual typology. International Journal of Electronic Commerce, 2001. 6(2): p. 35-59. 10