Transcript chap01

CHAPTER 1
Introduction to E-Business
Technologies
E-Business Technologies
1
Objectives
In this chapter, you will learn to:
• Describe the early technological development of
the Internet
• Discuss the origins and evolution of the World
Wide Web
• Identify the primary events that led to the
commercialization of the Internet and the World
Wide Web
• Define e-business models based on the
commercial application of Internet technologies
E-Business Technologies
2
The Early Development of the Internet
• Due to the intense economic, political, military,
and ideological rivalry between the United States
and the former Soviet Union, the Eisenhower
administration created the Advanced Research
Projects Agency (ARPA)
Why is it that many business opportunities that spring from technological advances
come from projectsClick
initiallyHere
funded by the government?
1. the government can raise extremely large amounts of capital and expertise
2. failed projects can be absorbed - does not bankrupt the government
3. the taxpayer frequently does not realize the project is being pursued
E-Business Technologies
3
Advanced Research Projects Agency
ARPA’s early focuses were to:
•
Fund military-oriented communications systems and computer
research - what is the relationship between computing and
communications then and now?
•
Develop a computer information systems edge over the Soviet
Union
The military understood that:
•
Mainframe computers were crucial for complex computational
tasks such as cryptography, weapons control, and other
military applications
•
Computers would be crucial for spaceflights and for military
command and control operations (remember that
'spaceflights' translated into missile weapons and a 'high
platform' for weapons delivery)
E-Business Technologies
4
ARPA’s New Vision
J. C. R. Licklider: moved the core thinking of ARPA towards
societal benefits and away from strictly military applications
•
Joined ARPA in 1962
•
Was a psychologist
•
Believed technological development would “save humanity,”
and the interaction between humans and computers would
lead to better decision making
•
Theorized that people would be more productive if they had
access to a good computer system and information databases
that they could use directly without having to go through
computer operators
•
Wrote “Man-Computer Symbiosis”
E-Business Technologies
5
ARPA’s Changing Mission
• Licklider conducted two major ARPA projects:
– A command and control project, to help the
military make timely decisions and then
implement those decisions quickly and
effectively using computers
– To find uses for computers beyond
mathematical and scientific calculations
E-Business Technologies
6
ARPA’s New Mission
• Licklider offered research contracts to the country’s top
computer research centers and scientists including:
– Stanford University
– The Massachusetts Institute of Technology (MIT)
– The University of California, Los Angeles (UCLA)
– The University of California, Berkeley
• By 1964, ARPA’s computer systems research and
development switched from military war games to timesharing (where multiple computer users at independent
terminals work on one computer at the same time),
graphics, and improved programming languages.
E-Business Technologies
7
Building ARPANET
• In 1966, the ARPA Information Processing
Techniques Office (IPTO) was receiving more
and more requests to fund purchases of new
computers for research contractors.
• To avoid this expense, IPTO directory Robert
Taylor initiated work on a project to connect the
computers used by research contractors to
enable information sharing.
E-Business Technologies
8
Building ARPANET
• The IPTO network project was assigned to Lawrence
Roberts, a research scientist who worked on a network
project that connected computers at MIT with computers at
System Development Corporation in California
Outside contributors on this project included:
• Leonard Kleinrock (UCLA)
• Douglas Englebart (Stanford Research Institute)
• Paul Beran (RAND Corp)
• Donald Davies (British National Physical Laboratory)
E-Business Technologies
9
ARPANET Delivery Timeline
• In 1968, the Department of Defense (DOD),
operating as the official government sponsor for
the ARPA network, sent out 140 Requests for
Proposals based on Roberts’ plan
• Twelve companies responded with bids
• The project was awarded to Licklider’s former
consulting firm, Bolt Beranek and Newman (BBN)
Why did IBM and CDC (two of the largest & most profitable
computer companies at that time) declined to participate in the
ARPA network? Why didn't AT&T participate?
E-Business Technologies
10
ARPANET Delivery Timeline
• In the fall of 1969, the computers of four IPTO
contractors were connected creating ARPANET.
These contractors were:
– The University of California, Los Angeles (UCLA)
– Stanford Research Institute (which later became
SRI)
– University of California, Santa Barbara (UCSB)
– The University of Utah
E-Business Technologies
11
Xerox computer
CDC computer
IBM computer
Xerox computer
E-Business Technologies
12
ARPANET’s Contribution to the
Internet
• In 1971, ARPANET had 15 nodes
• In 1972, the first international connection brought the
University College of London online
• Growth fuelled research and developed into improvements
in computers communications
• One essential new development was an agreed upon format
for transmitting data between the ARPANET computers,
called a protocol
• Transmission Control Protocol, (TCP), was developed by
Vinton Cerf at SRI and Robert Kahn at DARPA
• TCP became the basis for TCP/IP, the Internet protocol
standard IP
E-Business Technologies
13
Evolution of NSFNET
• Scientists developed new methods of sending
different types of data between computers: email, bulletin boards, etc.
• As APARNET became the Internet, networks were
absorbed or spun off (BITNET, MILNET)
• The National Science Foundation assumed the
cost of operating the Internet and created a
higher-speed system of interconnections called
the NSFNET
• NSFNET became the basis for the current Internet
E-Business Technologies
14
Packet Switching
• Packet switching enables a computer network to send data
over multiple paths, by passing failed connections when
necessary
• Paul Baran, a scientist with RAND Corp, proposed using
computers on a packet switched network as a solution for
the military’s need for a communications system that could
survive a nuclear attack
• Messages are broken down into blocks or packets before
transmission across a switched network. Packets take
different routes through the distributed computer network
to a single destination computer where they would be
reassembled.
E-Business Technologies
15
Packet Switching
Donald W. Davies:
• A physicist at the British National Physical
Laboratory (NPL)
• Proposed creating a distributed computer
network that used packet switching as a public
communications network
• Directed the creation of the NPL Data Network,
which used Davies’ packet theory to send
messages
As you think of packet switching and e-mail, etc, begin
Click
Hereas a viable concept.
to think of 'store
& forward'
E-Business Technologies
16
Origins and Evolutions
of the World Wide Web
display
• “Internet” refers to computers and the
connections between them. Also, it usually refers
to the rules, or protocols, that allow computers to
communicate with each other seamlessly.
• The World Wide Web (WWW) is a subset of the
Internet — a group of specially formatted
documents called Web pages
connection
Why is it important that the
network moved to NSFNet?
E-Business Technologies
17
Basic Components
of the World Wide Web
• Components of the World Wide Web include:
– Web sites, a collection of related Web
pages available from a single source
– Web server, the software that “serves” Web
pages when requested by a user
– Web browser, a software application used
to locate and display the pages
begin to think of who pays for the server resources and the browser resources in
order to assess economic viability for the idea
E-Business Technologies
18
Basic Components
of the World Wide Web
E-Business Technologies
19
The Beginnings
of the World Wide Web
• In 1980, Tim Berners-Lee began playing with a
software application, he called Enquire, to keep
track of research information at CERN, the
European Particle Physics Laboratory
• Enquire allowed Berners-Lee to link pages of
information stored on a single computer
• Berners-Lee left CERN without completing
development on Enquire
E-Business Technologies
20
The Beginnings
of the World Wide Web
• Berners-Lee returned to CERN in 1984 to
work with a team that documented the results
of individual experiment groups
• Berners-Lee needed to develop something
similar to the original Enquire software
application to perform his work
• He began working on an application-based
documentation systems model called
hypertext, in which text and other objects can
be linked to each other
E-Business Technologies
21
The Beginnings
of the World Wide Web
• In 1991, Berners-Lee’s system of linked documents, which
he called the World Wide Web, was a reality
It utilized:
• A text-based Web browser called WorldWideWeb
• An application called a Web server, which organized Web
pages on a server and allowed others to access them
• During the 1990s, CERN gave away the Web browser and
Web server to interested Internet users at no charge - so
what do you make of Netscape's, Oracle, and other
companies making the free give-away of a browser by
Microsoft as clear evidence of unfair business practices?
E-Business Technologies
22
The Beginnings
of the World Wide Web
Mosaic:
• Was developed in 1992 by programmers at the University of
Illinois Champaign-Urbana’s National Center for
Supercomputing Applications (NCSA)
• Was the first graphical Web browser
– Used both images and text for linking documents for
retrieval and display
• Development of commercial Web browsers followed in
quick succession with the development of Netscape
Navigator and Microsoft Internet Explorer
E-Business Technologies
23
Commercialization of the Internet
and the World Wide Web
• The three major events that led directly to the
commercialization of the Internet and the World
Wide Web are:
– The distribution of Berners-Lee’s early Web
browser and Web server software within the
Internet community
– The development of graphical Web browsers (you
must also know that computer power at an
affordable cost played a significant role)
– The legalization of commercial activity on
the NSFNET
E-Business Technologies
24
Commercialization of the Internet
and the World Wide Web
• Electronic linking of individuals and businesses
that followed has created a new economic
environment
– time and space are much less limiting
– information is more important and accessible
– traditional intermediaries are being replaced
– the consumer holds increasingly more power
because of
E-Business Technologies
25
Commercialization of the Internet
and the World Wide Web
• Electronic commerce (e-commerce) describes
business activities conducted using Internet
technologies, including:
– Buying and selling products and services
– Delivery of information
– Providing customer service before and after the
sale
– Collaborating with business partners
– Enhancing productivity within organizations
E-Business Technologies
26
Origins of E-Business
• In the 1960s and 1970s, banks began using Electronic
Funds Transfer (EFT) and large companies began sharing
information via Electronic Data Interchange (EDI)
• Using EDI, companies exchange information electronically
with suppliers, customers, and other “trading partners”
• This information includes invoices, purchase orders,
quotes, and bills of lading, traditionally passed on paper
• These transmissions generally occur over private
telecommunication networks called value-added networks
or VANs
E-Business Technologies
27
E-Business Models
• An e-business model is the way in which an e-business
generates revenues
• E-business models can be broadly categorized as:
– Business-to-Consumer (B2C)
– Business-to-Business (B2B)
– Business-to-Government (B2G)
– Consumer-to-Consumer (C2C)
– Consumer-to-Business (C2B)
E-Business Technologies
28
Business-to-Consumer (B2C)
• Sells products or services directly to consumers
• Brick-and-click model- brick-and-mortar business
using a Web storefront to reach consumers
• Subscription model- the e-business provides highvalue content for a subscription fee
• Catalog model- brick-and-mortar business that
migrates business completely to Web-based
ordering
E-Business Technologies
29
Business-to-Business (B2B)
• Sells products or services to other businesses or
brings multiple buyers and sellers together in a
central marketplace
• Business between companies can be transacted
over an extranet, allowing participants to view
each other’s data and complete business
transactions
• B2B exchange model uses Web sites that bring
multiple buyers and sellers together in a virtual
centralized marketspace
E-Business Technologies
30
Business-to-Business (B2B)
• A business trading community is a B2B exchange which
acts as a central source of information for a vertical market
• Web sites that serve a vertical market can include:
– buyer’s guides
– supplier and product directories
– industry news and articles
– schedules for industry trade shows and events
– classified ads
• The volume of B2B e-business is predicted to reach $4.3
trillion by 2005 (remember, by Census Bureau calculations
the B2B was a little more than $1 trillion in 2001 which
makes the figure reasonable with a 10-15% growth per year)
E-Business Technologies
31
Business-to-Government (B2G)
• Businesses that sell to government
agencies
• Similar to the B2B exchange model
• Provides a marketspace for businesses to
sell their products and services to
government agencies
E-Business Technologies
32
Consumer-to-Consumer (C2C)
• Consumers sell directly to other consumers
• Transactions executed through on-line classified
ads and auctions
E-Business Technologies
33
Consumer-to-Business (C2B)
• Consumers name own price which businesses
accept or decline
• The Web site collects the demand bids and then
offers the bids to participating sellers
E-Business Technologies
34
E-Business Advantages
• Seller advantages include:
– Increased sales
opportunities
– Decreased transaction
costs
– 24/7 operation
– Increased speed and
accuracy of information
exchange
• Consumer advantages
include:
– Wider product
availability
– Easy comparison
shopping and one-stop
shopping for business
buyers
– Ability to shop 24/7
– Access to global
markets
E-Business Technologies
35
E-Business Disadvantages
• Seller disadvantages
include:
• Consumer disadvantages
include:
– Rapidly changing
technology
– Poor customer service
– System security and
reliability problems
– Network deficiencies
– Increase in instances of
failure to pay for
merchandise or fraud
– Transaction security
and privacy
– Complex return
policies
– Lack of trust for
unfamiliar sellers
E-Business Technologies
36