POSTECH
Mobile Commerce
Prof. Euiho Suh
2004. 10. 18
POSMIS
Contents
1.
Definition and differences of M-commerce
2.
Classes of M-commerce applications
3.
4.
Terminology and Standards
5.
Attribute of M-commerce
6.
The driver of M-commerce
7.
Mobile Computing Infrastructure
8.
Wireless Standards and Security
9.
Applications : finance, shopping
10.
Location-based Commerce
11.
Limitations of M-commerce
12.
2
Value Chain
Technical Limitation
POSMIS
Definition of Mobile Commerce
 Any transaction conducted over a mobile telecommunications
network.
 It represents a subset of all e-commerce transactions
both in business-to-consumer and the business-to-business
area
3
POSMIS
Differences between M- and E- commerce
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4
A permanent factor that makes difference
between M- and the rest of the E- commerce is
the possibility of the user to engage anywhere
and anytime in M-commerce transactions; for
some this is the crucial difference
The main functional distinction between the Ecommerce in general and M-commerce are
dynamic Location Based Services (LBS) that use
the actual location of the terminal on earth in one
way or the other to perform the transaction (cf.
ordering taxi in a foreign city based on the
positioning of the terminal and the taxi)
POSMIS
Differences between M- and E- commerce (Cont.)
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5
Further difference are the properties of the truly
portable terminals: the simple UI facilities, slower
processor, and smaller memory resources, as well
as tiny energy reserves, as compared to PC:s or
laptops
A fourth main difference is the relatively small
wireless link transmission capacity offered to the
terminals; although the capacity is increasing
with every network generation (10 kbps, 100
kbps, 1 Mbps..), so is the capacity of the fixed
networks; thus the gap will exist also in the
future
POSMIS
Classes of M-Commerce Applications
6
POSMIS
Classes of M-Commerce Applications (Cont.)
M – Commerce
Applications
WASP
Job Dispatch
CRM
Telemetry
Advertising
Music
Games
Auctions
Supply chain
Integration
Video
Shopping
Healthcare
Telematics
Information
Provisioning
Broking
Reservations
Ticketing
Banking
M-payment
E-bill
Information
Management
Security
SMS
SMS
Toolkit
1998
WAP
2000
1999
SMS
EDGE
2001
2002
UMTS
2003
2004
PIM
Customer care
Source: Durlacher, Veba
7
GPRS
IM
Chat
E - mail
E-salary
UIM
M – Commerce
Enabling Applications
POSMIS
Mobile Commerce Value Chain
Source : The mobile commerce value chain: analysis and future developments, Stuart J. Barnes,
International Journal of Information Management 22 (2002) 91–108
8
POSMIS
M-Commerce Terminology
Generations
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1G: 1979-1992 wireless technology
2G: current wireless technology; mainly
accommodates text
2.5G: interim technology accommodates
graphics
3G: 3rd generation technology (2001-2005)
supports rich media (video clips)
4G: will provide faster multimedia display
(2006-2010)
POSMIS
Terminology and Standards
 GPS : Satellite-based Global Positioning System
 PDA : Personal Digital Assistant—handheld
wireless computer
 SMS : Short Message Service
 EMS : Enhanced Messaging Service
 MMS : Multimedia Messaging Service
 WAP : Wireless Application Protocol
 Smartphones : Internet-enabled cell phones
with attached applications
10
POSMIS
Specific Attributes of M-Commerce
Attributes of m-commerce and its
economic advantages
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Mobility — users carry cell phones or other mobile
devices
Broad reach — people can be reached at any time
POSMIS
Attributes of M-Commerce (cont.)
Value-added attributes of m-commerce
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Ubiquity
easier information access in real-time
Convenience
devices that store data and have Internet, intranet, extranet
connections
Instant connectivity
easy and quick connection to Internet, intranets, other mobile
devices, databases
Personalization
preparation of information for individual consumers
Localization of products and services
knowing where the user is located at any given time and match
service to them
POSMIS
Characteristics of M-Commerce
13
POSMIS
The Drivers
 Widespread
availability of
devices
 No need for a PC
 Handset culture
 Vendors’ push
14
 Declining prices
 Improvement of
bandwidth
 Explosion of EC in
general
POSMIS
Mobile Computing Infrastructure
Hardware
 Cellular (mobile)
phones
 Attachable
keyboard
 PDAs
 Interactive pagers
 Other devices
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15
Notebooks
Handhelds
Smartpads
 Screenphones—a
telephone equipped
with color screen,
keyboard, e-mail, and
Internet capabilities
 E-mail handhelds
 Wirelined—connected
by wires to a network
POSMIS
Mobile Computing Infrastructure (cont.)
Unseen infrastructure requirements
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Suitably configured wireline or wireless WAN
modem
Web server with wireless support
Application or database server
Large enterprise application server
GPS locator used to determine the location of
mobile computing device carrier
POSMIS
Mobile Computing Infrastructure (cont.)
Software
 Microbrowser
 Mobile client operating system (OS)
 Bluetooth—a chip technology and WPAN standard that enables
voice and data communications between wireless devices over
short-range radio frequency (RF)
 Mobile application user interface
 Back-end legacy application software
 Application middleware
 Wireless middleware
17
POSMIS
Mobile Computing Infrastructure (cont.)
Networks and access
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Wireless transmission media
 Microwave
 Satellites
 Radio
 Infrared
 Cellular radio technology
Wireless systems
POSMIS
Wireless Standards and Security
M-commerce supported by
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19
Standards
Security
Voice systems
POSMIS
Wireless Standards
Wireless standards
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Time-division Multiple Access (TMDA)
General Packet Radio Services (GPRS)
Code Division Multiple Access (CDMA)
CDMA One
Global System of Mobile Communication
(GSM)
WLAN 802.11b (Wi-Fi)
Wideband CDMA
POSMIS
Wireless Standards (cont.)
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Wireless Application Protocol (WAP)—a set of
communications protocols designed to enable
different kinds of wireless devices to talk to a
server installed on a mobile network, so users
can access the Internet
Subscriber Identification Module (SIM)
Wireless Markup Language (WML)
Voice XML (VXML)
Enhanced Data Rates for Global Evaluation
(EDGE)
Universal Mobile Telecommunications System
(UMTS)
IPv6
POSMIS
Security Issues
Viruses
Smart card security solutions
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Voice communication can be intercepted by
hackers
One solution is an embedded biometric addon
Back-end security solutions
public key infrastructure (PKI) and M-CERT
(mobile certification)
22
POSMIS
Voice Systems for M-Commerce
Hands-free and eyes-free operations
increase productivity, safety,
effectiveness
Disabled people can use voice data for
various tasks
Voice terminals are portable
2 ½ times faster than typing
Fewer errors
23
POSMIS
Applications : mobile financial
Wireless electronic payment
systems
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Mobile phones become secure, selfcontained purchasing tools capable of
instantly authorizing payments over the
cellular network for goods and services
consumed
Micropayments—electronic
payments for small-purchase
amounts (generally less than $10)
24
POSMIS
Applications : mobile financial (cont.)
M-wallet (mobile wallet)—a wireless
wallet that enables cardholders to
make purchases with a single click
from their wireless devices
Bill payments directly from cell
phone via:
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Bank
Credit card
Prepaid arrangement
POSMIS
Applications : mobile financial (cont.)
 Swedish Postal
Bank
 Dagens Industri
 Citibank
 Japanese banks
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 Hoover’s wireless
(hoover.com)
 ASB Bank (New
Zealand)
 Boston’s Faneuil
Hall Marketplace
POSMIS
Bill Payments by Cell Phone
27
POSMIS
Applications : Shopping from Wireless Devices
Buy.com allows shopping from
wireless devices
In 5-10 years most businesses will be
wireless
Online stores will become showrooms
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View products
Purchase them using handheld devices
Possibly enhanced by bar code scanners
Customization may be possible
POSMIS
Applications : Shopping from Wireless Devices (Cont.)
29
POSMIS
Location-Based Commerce
 Location-based commerce (L-commerce)
e-commerce applications provided to customers based on a
user’s specific location
 Location-based technologies
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Global positioning systems—a wireless system that uses
satellites to enable users to determine their position
anywhere on the earth
Geographical information systems (GIS)—relates longitude
and latitude of GPS into place or address (mapinfo.com)
GPS on handsets—stand-alone units for tracking
applications
POSMIS
Location-Based Services Involving Maps
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POSMIS
GPS System
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POSMIS
Applications : Telematics and Telemetry
 Telematics—integration of computers and
wireless communications to improve
information flow using the principles of
telemetry
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GM OnStar system—cellular phone and PDA are
integrated to provide personal information
management, mobile Internet services,
entertainment on the vehicle vehicle dashboard
Sophisticated text-to-speech and voice recognition
capabilities minimize driver distraction
POSMIS
Applications : Telematics and Telemetry (Cont.)
 Use as a remote vehicle self-diagnostics tool
 Daimler-Chrysler and Volvo experimented with
installation of GSM chip sets in cars
 Monitor performance and to provide an early
warning system for potential problems
 Chip sends a message to the manufacturer
indicating what the problem is
 Manufacturer’s system analyzes various data and
provides a fix (via a software tool)
 Developing faults found before they become critica
and continuous operation of the car can be ensured
34
POSMIS
Barriers to Location-Based Commerce
The accuracy of some of the
location technologies
The cost-benefit justification
M-spam
The bandwidth of GSM networks
35
POSMIS
Limitations of M-Commerce
Usability problem
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Usability of a site is critical to attract
attention and retain user stickiness
Effectiveness, efficiency, satisfaction
Some mobile devices are found to be
ineffective
Customers want to find exactly what they
are looking for, easily and quickly, not
possible in the 2G text-based environment
More and faster multimedia will be available
as 3G spreads
POSMIS
Technical Limitations
 Lack of standardized
security protocol
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Security methodology
needs to be
incorporated in
mobile
Customer confidence
is low
 Insufficient
bandwidth
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37
Limits the extent to
which mobility can be
viewed commodity
 3G licenses
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Auctioned by
governments
Certain countries cannot
be served by these
devices
 Transmission & power
consumption
limitations
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Multipath interference
Weather and terrain
problems
Distance-limited
connections
POSMIS
Technical Limitations (cont.)
WAP limitations
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Speed—in 2002 connections to WAP sites are
still too slow
Cost—fees for mobile phone users are still too
high
Accessibility—as of spring 2002, fewer than
50,000 WAP-accessible sites worldwide (must
be written in WML)
POSMIS
Technical Limitations (cont.)
Potential health hazards
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Fear of radiation
Unsafe to drive and use wireless phone
Cell phones may interfere with sensitive
medical devices (pacemakers)
Lawsuits relating to the potential health
hazards of wireless devices have already
been filed—public is advised to adopt a
precautionary approach in using mobile
phones (earphone device)
POSMIS