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CIS-325
Data Communications
Dr. L. G. Williams, Instructor
CIS-325: Data Communications
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Chapter Fifteen
Doing Business on the
Internet
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The Internet
1969 - ARPANET
 Packet-switching net
 TCP/IP
 e-mail, FTP, TELNET
 1982 - Internetworking
 1980 - NSF network
 1990 - NSF and ARPA nets combined
 1995 - Internet goes commercial

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Internet Commerce
 Major
drawback is lack of security
 Secure Socket Layer
 encrypts
all communications
 developed by Netscape
 Secure
HTTP
 client
and server negotiate variety of security
methods as needed
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Electronic Payment Systems
 Protect
credit card number
 Ensure receipt by vendor
 Non-repudiation
 Ability to make micro-payments
 Vendor confidence in payment
 Note: this is different than EFT
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Characteristics
 Type
of transactions supported
 Means of settlement
 Operational Characteristics
 Privacy and Security
 Who takes the risks?
 Complications
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Secure Electronic
Transactions (SET)
 Payment
protocol, sponsored by VISA and
MasterCard
 Payment using credit or debit card
 Uses public-key encryption
 In development since 1996
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SET Entities
 Cardholder
 Vendor
 Financial
Institution
 Certificate Authority
 see Fig 15.5, p. 457
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SET Goals
Merchant wants to ensure valid payment method
 User wants to ensure payment not modified
 User wants to ensure card info not compromised
 Bank wants to ensure funds available to cover
transaction
 Table 15.5, p. 460, lists steps of process

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Electronic Cash
 Independence
 Security
 Privacy
 Off-line
payments
 Transferability
 Divisibility
 Especially needed for micro-payments
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E-Cash
Easier than ATM
 Provides anonymity
 Uses cryptographic methods
 Must have e-cash acct with bank
 User maintains ‘wallet’ on PC
 Wallet contains digital-coin tokens
 System prevents ‘coins’ from being spent twice

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How to use E-Cash
Establish acct with bank
 Software resides on your PC
 Transfer coins between bank and wallet as needed
 Vendor requests payment from your wallet
 Say yes or No or make automatic payments
 Someone can also send you ‘coins’
 Bank maintains serial numbers of tokens to ensure
no duplicate payments
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