Electronic Commerce & Agents
Frank Dignum
Utrecht University
dignum@cs.uu.nl
Overview
•
•
•
•
•
•
•
Historical overview
Definition of Electronic Commerce (EC)
Examples of EC
Electronic markets and auctions
Agents
The role(s) of agents in EC
Conclusions
Historical perspective
•
•
•
•
•
(Big) calculators
Central databases
distributed information and word processing
client/server connected databases
support of (administrative) internal
processes (WFMS)
Historical perspective
• Support of internal communication
(groupware)
• Knowledge management
• Support of external communication
(Internet & WWW)
• Support of external processes (Electronic
commerce)
Definition (?)
Electronic Commerce is:
Any form of business transaction in which the
parties interact electronically rather than by
physical exchanges or direct physical
contact
Commerce
Information
exchange
Product/service/… exchange
Information exchange
•
•
•
•
•
•
Partner/product search
negotiation, market, auction
contract
contract fulfilment (directives)
legal information
etc.
Product/service exchange
•
•
•
•
(micro-)payment
(intangible) product
logistics of products and services
subscription mechanisms
Stages of Business Transactions
Business Transaction
Stages
Information stage
Negotiation stage
Fulfillment stage
Satisfaction stage
Support for stages
Business Transaction
Stages
Information stage
Negotiation stage
Fulfillment stage
Satisfaction stage
-Trade relations
Support
for
stages
-Chambers of
commerce
-product and
company data
bases
(e.g. Dun &
Bradstreet)
-WWW
Trusted Third Parties
- EDI-translators
-WWW
- Standards
(e.g. EDIFACT,
ANSI X.12)
-e-mail
-TradeCard
-SET (Secure
electronic trading)
business
Consumer
Public agencies
business
12/22
EC Applications
•
•
•
•
•
•
•
Supply chain management
Home shopping
Remote banking
On-line marketing and advertising
Distant learning
Procurement and purchasing
Video on demand
Examples of EC (B-C)
• Retail
– Internet bookshop
– CDNow
– Shopping malls
– Auctions
– Collective buying
Item watching at e-bay now
Examples of EC (B-C)
• Finance
– ESI (stock market)
– Electronic banking
Publishing
Examples of EC (B-B)
• Business to business support
–
–
–
–
Maxtrad (business information)
MEMO (Mediating and Monitoring EC)
Secure contracts (ICC)
Bolero (electronic document support)
• Markets
– Automotive industry (collective buying)
– Retail world
– Insurance private exchange of virtual products
Role of institutions
• Facilitate the transactions
– Provide efficient price discovery mechanism
– Provide standard transaction protocols
– Provide settlement mechanisms
• Enhance trust through
–
–
–
–
Provision of info on potential partners
Legal provisions to back up contracts
Provide securities/guarantees
Provide regulations on behaviour during transactions
and means to enforce them
Infrastructure for electronic markets
• Banking facilities
• Communication
–
–
–
–
confidentiality
integrity
authentication
non-repudiation
• Transfer and storage of products
• Advertising
Banking facilities
• Different payment methods should be
supported
• Payment should be safe
• Payment and delivery guaranteed
Communication
• Some common language should be used.
• Constructs in the language should have a
precise and formal meaning.
– Note: currencies should be clear
• Contracts should be legally binding.
– Obligations should be visible
Storage and transfer of goods
• Physical products can be sold only once.
Their digital representation can easily be
copied and sold more than once.
• Downloading of digital products should be
possible.
• Transport should be arranged for other
products.
Advertisement
• How is advertisement arranged?
– Blackboard?
– Shopping mall?
– One-on-one advertisement allowed?
• Format of advertisements?
• Payed advertisements?
• Who can advertise?
Types of markets
• Direct transactions
– shopping mall
– classified ads
– direct negotiation
• Brokered transactions
– distributors
– brokers
• auctions
Types of markets II
• Direct transactions
– direct contact buyer and seller
– less structured transactions
– influence market (institution) smaller
• Brokered transactions
– controlled contact between buyer and seller
– transaction protocol very strict
– institution has total control
Auctions
• Only “negotiate” about price.
• Fixed:
–
–
–
–
–
product specification
payment method
transport
delivery terms
etc.
Auctions
• Sealed auctions
– First priced sealed bid
– Vickrey
– Sealed double auction
• Open auctions
– Dutch auction
– English auction
First price sealed bid
• Rules (protocol):
– Bidders submit a single sealed bid before
deadline
• Outcome:
– Winner is highest bid at bid price
• Optimal strategy:
– Bid just below private value of item
– With N bidders bid: v(N-1)/N
Vickrey
• Rules (protocol):
– Bidders submit a single sealed bid before
deadline
• Outcome:
– Winner is highest bid at second highest price
• Optimal strategy:
– Bid private value of item
Sealed double auction
• Rules (protocol):
– Bidders and sellers submit a single sealed bid
before deadline
• Outcome:
– Auctioneer determines a single market-clearing
price and matches buyers and sellers
• Optimal strategy:
– Bid private value of item
Dutch auction
• Rules (protocol):
– Auctioneer calls out descending price.
– Bidder calls out a bid
• Outcome:
– Winner is first bidder to call out at price bid
• Optimal strategy:
– Bid just below private value of item
English auction
• Rules (protocol):
– Bidders successively raise bid for item until one
bidder remains
• Outcome:
– Winner is last bidder remaining at price of
second-highest bidder
• Optimal strategy:
– Bid until private value of item, then drop out
Non-private value auctions
• Value of item depends at least partly on the
value others give it.
– Resellable products (tasks)
– treasury bills
• Strategy now also depends on expectation
or knowledge of the value others give the
product.
Other issues on auctions
• Bidder collusion
• Lying auctioneer
• Interrelated auctions
Examples of auctions
•
•
•
•
•
http://www.wehkamp.nl/Veiling/
http://www.ebay.com/aw/
http://www.onsale.com/
http://www.band-x.com/
http://www.auctionconnect.lycos.com/
Technologies in EC
•
•
•
•
•
•
•
EDI
WWW
Multimedia
Work Flow Management
Agents
Electronic payment, smart cards, etc.
...
Agents
• Agent properties:
–
–
–
–
–
autonomous
pro-active
reactive
social ability
learning
• Agent functions:
– information gathering and filtering
– negotiation (simple like auction or ContractNet)
– monitor long-term processes
Agents and electronic commerce
• Agents for support:
– information gathering and comparison (e.g.
shopbots: firefly)
– logistics
• Agents as delegates:
– only when trust is not important or easy
– Price and risk are low
– Process well defined
Agent operated markets
•
•
•
•
http://auction.eecs.umich.edu/
http://www.iiia.csic.es/Projects/fishmarket/
Stock market
Power trade
Agents for negotiation
• Limited use due to complexity, but
• Very useful for e.g. auctions with:
– “Simple” world model
– Predetermined interactions
– Fixed rules
– One shot relations
– centralised infrastructure
Agents for negotiation
Fully automated AMEC first in situations where:
1. Interactions are fast
2. Interactions are repeated
3. Trade is of relative small value
4. Process is repeated over long periods
5. Products are easy to specify
Examples: stock trade, power trade and telecom
Item watching at e-bay now
Item watching with agents
• Agent watches auctions in which you are
interested
• Agent warns when your bid is overturned
• Agent warns when it gets interesting to start
bidding
• Agent bid (strategically) up till a predefined
level
Conclusions
• EC contains many, different aspects
• EC is per definition multi-disciplinary
• Agents can support in information seeking
phase (now already)
• Agents play a role in transactions when
these are well defined and the need for
speed or monitoring is high
Vraag
1. Als ik mijn auto wil verkopen, kan ik hem dan
beter op een Engelse veiling (boden lopen op) of
een Nederlandse veiling (veilingmeester laat
prijs dalen) aanbieden? Geef aan waarom.
2. Wat zou een agent op een Nederlandse veiling
van bv. bloemen kunnen leren, waardoor hij in
de loop van een ochtend beter gaat bieden?
Welke informatie moet hij hiervoor bijhouden?