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Secure Electronic Transaction (SET)

By Dinesh Thakur

This also uses digital certificates, which also come from Certificate Authorities, but here another organization known as a proxy merchant is also involved. The idea is that buyers send their, suitably encrypted, credit card details to the proxy merchant which performs the same identity check as for SSL. Assuming everything is in order this proxy merchant then sends an authorization to the seller, but withholds the credit card details. From the point of view of the seller they have the go ahead to complete the transaction, they will get paid, while the actual details of the credit card are, to them, irrelevant. All they need to know is that the card is genuine. It is therefore only the proxy merchant which can match credit card details to name and addresses.

This might seem like transferring the problem rather than solving it as there will still exist a computer file holding extremely valuable credit card details, but the safety here lies in the quantity of those files. Instead of potentially millions of websites each holding credit card details there will be just a small number where the security can be guaranteed; something that cannot always be said of other websites. By concentrating the information together in this way it can be guarded by organizations where security is of paramount concern and taken care of by experts. In fact the latest boast from the companies involved with SET is that their information is protected by encryption routines stronger than those used by the military to protect nuclear launch codes. (So if SET security is ever broken the world might have more to worry about than a banking scandal.)

Given that SET is being backed by MasterCard, Visa and American Express not to mention Microsoft and Netscape the chances are high that this will be adopted throughout the Internet. As such any company who wants to trade off their website has very little choice but to take an interest.

Finally, for anyone wondering where on the computer all these digital certificates will be stored the answer is simple: in a ewallet. These are now included as standard in the latest versions of all the Browsers.

Now that what might best be described as the theory has been dealt with it becomes time to consider more practical matters. Exactly how can anyone set up their own e-commerce website? The first, and easiest, way of setting up an e-commerce website is to throw money at it. Outside consultants can be brought in or companies specializing in e-commerce solutions can be approached. Then just sit back and let it happen. By far the easiest it might be, but it is also the most expensive. In which case what follows is for people who lack such deep pockets. People, in other words, who have to do it themselves,. Here the first point to consider is payment. How will a company be paid for goods bought off a website?

What is bar code reader?

By Dinesh Thakur

A computer input device that reads the BAR CODE printed on an article of merchandise and converts it to a number: such readers depend on the reflection of a low-powered laser beam to read the pattern of stripes. Bar code readers are available both as hand-held units for stocktaking, and built into tills or supermarket checkout stations.

What is bar code?

By Dinesh Thakur

A pattern of vertical black stripes, of variable width, printed on the packaging of merchandise sold in shops to enable automatic stock control and pricing: the stripe widths encode a number that identifies the item. A BAR CODE READER measures these stripes to calculate the number, which can then be looked up in a price database by software running in a POINT-OF-SALE TERMINAL.

EDI – What is Electronic Data Interchange?

By Dinesh Thakur

Electronic transactions have been around for quite some time in the form of Electronic Data Interchange or EDI. EDI requires each supplier and customer to set up a dedicated data link (between them), where e-commerce provides a cost-effective method for companies to set up multiple, ad-hoc links.

 

Electronic commerce has also led to the development of electronic marketplaces where suppliers and potential customers are brought together to conduct mutually beneficial trade.

EFT – What is Electronic Fund Transfers?

By Dinesh Thakur

Funds are transferred electronically from the customers bank account to yours. (This is a highly simplified explanation, and is accurate in the most general sort of way. However, the bottom line is that the customer buys, and at some point the funds are removed from his or her account and ultimately deposited into yours.)

 

The best known method is the issuing of electronic checks Customers pay for merchandise by writing an electronic check that is transmitted by email, fax or phone. The “check” is a message that contains all of the information that is found on an ordinary check, but it is signed digitally, or indorsed.

 

The digital signature is encoded by encrypting with the customer’s secret key. Upon receipt, the merchant or “payee” may further indorse by encoding with a private key. When the cheque is processed, the resulting message is encoded with the bank’s secret key, thus providing proof of payment.

Define Electronic Wallet

By Dinesh Thakur

Electronic Wallets store your credit card numbers on your hard drive in an encrypted form. You then make purchases at Web sites that support that particular type of electronic wallet . By clicking on a Pay Button, customers initiate a credit card payment via a secure transaction enabled by the electronic wallet company’s server.

What is Digital or Electronic Cash or E-cash or Ecash or Digital Money

By Dinesh Thakur

These terms are also used interchangeably, and they refer to any of the various methods that allow a person to purchase goods or services by transmitting a number from one computer to another.

 

The numbers are issued by a bank and represent sums of real money. Digital cash is anonymous and reusable. Unlike credit card transactions, the merchant does not know the identity of the shopper.

EPS – What is Electronic Payment system?

By Dinesh Thakur

An electronic payment system is needed for compensation for information, goods and services provided through the Internet – such as access to copyrighted materials, database searches or consumption of system resources – or as a convenient form of payment for external goods and services – such as merchandise and services provided outside the Internet. it helps to automate sales activities, extends the potential number of customers and may reduce the amount of paperwork.

Requirements:

security: payment systems are very likely to become a target for criminal attacks.flexibility: different models for different situations (anonymity, accountability, risk).computational efficiency: support for micropayment; per-transaction cost must be small enough so that they are insignificant.
Payment Methods:

secure (or non-secure) presentation: the customer provides credit card information over a secure (or even clear) transportation means.

customer registration: the customer gets a password or digital signature based on a credit card (hides the credit card information from the merchant, but still clears through the credit card).

credit-debit instruments: similar to customer registration but only one bill per month either through credit card or debit check.

electronic currency: this method has potential for anonymity but requires tamper resistant hardware.

server scrip: the customer gets a kind of coupons from an agent that can be spend only with one particular merchant. this reduces the risk of double spending and allows off-line transactions.

direct transfer: the customer initiates the transfer of funds to the account of the merchant. this method provides no anonymity.

collection agent: the merchant refers the customer to a third party who collects payment using one of the methods mentioned above.

How Payment Processing Works?

By Dinesh Thakur

         Payment processing in the online world is similar to payment processing in the offline or “Brick and Mortar” world, with one significant exception. In the online world, the card is “not present” at the transaction. This means that the merchant must take additional steps to verify that the card information is being submitted by the actual owner of the card, Payment processing can be divided into two major phases or steps: authorization and settlement.

 

Payment Processing—Authorization and Settlement

Authorization verifies that the card is active and that the customer has sufficient credit available to make the transaction. Settlement involves transferring money from the customer’s account to the merchant’s account.

Authorization: Online

A customer decides to make a purchase on a merchant’s Web site, proceeds to checkout, and inputs credit card information.

The merchant’s Web site receives customer information and sends transaction

information to the payment gateway. The payment gateway routes information to the processor. The processor sends information to the issuing bank of the customer’s credit card. The issuing bank sends the transaction result (authorization or decline) to the processor.

The processor routes the transaction result to the payment gateway. The payment gateway passes result information to the merchant.

The merchant accepts or rejects the transaction and ships goods if necessary. Because this is a “card not present” transaction, the merchant should take additional precautions to ensure that the card has not been stolen and that the customer is the actual owner of the card.

Payment Processing—Settlement

The settlement process transfers authorized funds for a transaction from the customer’s bank account to the merchant’s bank account, The process is basically the same whether the transaction is conducted online or offline.

 

What are Electronic Payment Technology Issues

By Dinesh Thakur

Online payment processing requires coordinating the flow of transactions amonga complex network of financial institutions and processors. Fortunately, technology has simplified this process so that, with the right solution, payment processing is easy, secure, and seamless for both you and your customers.

Online Payment Processing Basics

Purchasing online may seem to be quick and easy, but most consumers give little thought to the process that appears to work instantaneously. For it to work correctly, merchants must connect to a network of banks (both acquiring and issuing banks), processors, and other financial institutions so that payment information provided by the customer can be routed securely and reliably.

The solution is a payment gateway that connects your online store to these institutions and processors. Because payment information is highly sensitive, trust and confidence are essential elements of any payment transaction. This means the gateway should be provided by a company with in-depth experience in payment processing and security.

The Payment Processing Network

Here’s a breakdown of the participants and elements involved in processing payments:

 

Acquiring bank: In the online payment processing world, an acquiring bank provides Internet merchant accounts. A merchant must open an Internet merchant account with an acquiring bank to enable online credit card authorization and payment processing. Examples of acquiring banks include Merchant eSolutions and most major banks.

Authorization: The process by which a customer’s credit card is verified as active and that they have the credit available to make a transaction. In the online payment processing world, an authorization also verifies that the billing information the customer has provided matches up with the information on record with their credit card company.

Credit card association: A financial institution that provides credit card services that are branded and distributed by customer issuing banks. Examples include Visa® and MasterCard®

Customer: The holder of the payment instrument—such as a credit card, debit card, or electronic check.

Customer issuing bank: A financial institution that provides a customer with a credit card or other payment instrument. Examples include Citibank and Suntrust. During a purchase, the customer issuing bank verifies that the payment information submitted to the merchant is valid and that the customer has the funds or credit limit to make the proposed purchase.

Internet merchant account: A special account with an acquiring bank that allows the merchant to accept credit cards over the Internet. The merchant typically pays a processing fee for each transaction processed, also known as the discount rate. A merchant applies for an Internet merchant account in a process similar to applying for a commercial loan. The fees charged by the acquiring bank will vary.

Merchant: Someone who owns a company that sells products or services.
Payment gateway: A service that provides connectivity among merchants, customers, and financial networks to process authorizations and payments. The service is usually operated by a third-party provider such as VeriSign.
Processor: A large data center that processes credit card transactions and settles funds to merchants. The processor is connected to a merchant’s site on behalf of an acquiring bank via a payment gateway.

Settlement: The process by which transactions with authorization codes are sent to the processor for payment to the merchant. Settlement is a sort of electronic bookkeeping procedure that causes all funds from captured transactions to be routed to the merchant’s acquiring bank for deposit

EDI standards

By Dinesh Thakur

EDI standards are very broad and general because they have to meet the need of all businesses.

 

EDI share a common structure:-

 

1. Transaction set is equivalent to business document, such as purchase order. Each transaction set is made up of data segments.

 

2. Data segments are logical groups of data elements that together convey information, such as invoice terms, shipping information or purchase order line.

 

      3. Data elements are individual fields, such as purchase order number, quantity on order, unit price.

 

The need for EDI standards:-

EDI provides on electronic linkage between two trading partners. To send documents electronically to each other, firms must agree on a specific data format and technical environment.

 

EDI standards and initiatives:-

 

National standards:-

 

 1. ODETTE:- an EDI format developed for European motor industry. ODETTE stands for organization for data exchange by tele transmission in Europe.

       2. TRADACOMS:- it is UK national standard, which is developed by ANA (Article number association) in 1982.

 

ANSI ASC X12 (American national standards – X12) – X12 is a standard that defines many different types of documents, student loan applications, injury and illness supports and shipment and billing notices.

 

International standards –

 

EDIFACT – (Electronic data interchange for administration, commerce and transport) was developed during 1990’s with a subset of EANCOM, which is the most widely used dialect of EDIFACT in international retail and distribution sector.

 

UN/EDIFACT – (United nations/electronic data interchange for administration commerce and transport) is an international set of EDI standards that are published by united nations trade data interchange (UNIDID).

 

What is Electronic Data Interchange?

By Dinesh Thakur

1. The buyer enters order information into the production database, which generates a purchase order on the computer. The order information is then channeled through a number of interface programs.

 

2. The interface software programs perform edits and checks on the document and direct the order data into predefined EDI intermediate files.

3. The EDI intermediate files contain information in a form that the EDI translation software can read.

 

4. The translation software is a set of programs that translates the interface file data into a document formatted according to EDI standards that the supplier’s computer can recognize.

 

5. The electronic document now consists of a file that contains the order data in a predefined, recognizable order.

 

6. The communications software adds appropriate communications protocols to the EDI document in preparation for transmission via telephone lines.

 

7. Using a modem and telephone line, the buyer transmits the EDI purchase order to a VAN (Value added network).

 

8. The communications software on the supplier’s computer picks up the document from the VAN, interprets and/or converts the communications protocols to open the electronic document.

 

9. The purchase order is now in a standard, recognizable format in a file and is available to the supplier’s computer.

 

10. The supplier’s translation software interprets the documents from the EDI format and places the order information in EDI intermediate file(s).

 

11. The EDI intermediate files contain the translated purchase order information.

 

      12. The interface programs perform edits and checks before the data is integrated with the supplier’s production database

 

 

EDI Architecture

By Dinesh Thakur

 EDI architechture specifies 4 layers:-

1)Semantic (application layer)

2)Standard transaction layer

3)Packing (transport) layer

4)Physical n/w infrastructure layer.

1)Semantic layer:- It describes the business application that is driving EDI.

For a procurement application, this translates into requests for quotes, price quotes, purchase orders, acknoledgements & involves.

The information seen at this layer must be translated from a company specific from to a more generic form so that it can be send to various trading partners, who could be using a varity of software applications at this end.

When a trading partner sends a document, the EDI translation software converts the proprietary format into a standard mutually agreed on by the processing system. When a company receivers the document, their EDI translation software automatically changes the standard format into proprietary format of their document processing software so that company can manipulate the information in whatever way it chooses to.

 2. EDI standards:- It specify business form structure and it also influence the content at application layer.

3. The most two important standards are:-

     – EDIPACT

     – ANSI X12

 

3.EDI transport layer:- it corresponds closely with the non-electronic activity of sending a business form from one company A to company B.

The business form could be sent via regular postal service, registered mail, certified mail or private carrier such as united pariel service (UPS) or simply faxed between the companies.

EDI semantic layer application level services

EDI standard layer EDIFACT

ANSI X12

EDI transport layer e- mail X 435

Point2point FTP

www HTTP

4.Physical layer :- Dial up lines

 

What are EDI terminology

By Dinesh Thakur

A trading partners:- a trading partner is an organization who uses EDI. They are assigned a trading partner ID number which is their generic “customer number”.  If you decided to use EDI, you will register your company with your service provider (VAN) who will provide with a trading partner.

 

B VAN:- it is a service provider which stores your EDI mail form your trading partners and transmits your EDI documents to your trading partner’s mailbox.

 

C transaction software:- software used to send & service EDI documents within VAN.

 

Global / DX:- this modules takes the output from the transaction software & creates necessary transactions and also creates files trading partners.

 

 

What is VPN – Virtual Private Network?

By Dinesh Thakur

A Virtual Private Network (VPN) is that private network built on a public network. The reasons that push the market in that direction are, mainly, of costs: it is much cheaper to interconnect delegations using a public infrastructure than to deploy a physically private network.

Virtual Private Networks (VPNs) use advanced encryption and tunneling so that organizations can establish secure private end-to-end network connections over third-party networks, such as the Internet or extranets. When leveraging third-party networks through VPNs, organizations do not have to continue using costly leased lines or Frame Relay lines, which are generally tricky to dispose of for remote locations. VPNs also allow secure connectivity with suppliers and partners, allowing the use of new networked business applications. VPNs also connect remote users and mobile users to the corporate network through a local Internet service provider, rather than through expensive long distance calls. Also, VPNs offer a much higher level of security, through their advanced encryption protocols, thus making the data can only read by the receiver to which they sent.

Types of VPNs

 VPNs are generally divided into three categories: intranet, extranet and remote access.

• Intranet (site-to-site): they are indicated to connect fixed locations, branches, branches, and remote offices. They normally use dedicated connections within the company’s WAN communications structure based on an operator’s private IP network.

• Extranet: implemented to expand network services and provide limited and secure access to partners and customers of a company. These extensions are generally supported by public networks (typically the Internet, the public IP network par excellence), for client accesses and private IP networks with higher quality access for partners and collaborators.

• Remote access: they provide secure access to mobile users and small offices with very basic communication needs. They use existing access networks, RTB and ISDN, to connect over the Internet.

It is interesting to highlight at this point, the difference between implementing a VPN over a private IP network or a public network (Internet).

On a private IP network, the corresponding operator can ensure an agreed quality of service (SLA) and can control and monitor its network to optimize its performance. They are networks designed and intended for corporate traffic that do not compete for bandwidth resources against domestic users who surf the Internet. Finally, being private networks intrinsically carry security and do not need to add costly encryption protocols in terms of equipment, delays, packet size increase, etc. Even so, they can implement if the security requirements are so strict that they demand them.

On a public IP network such as the Internet, no quality of service can guaranteed since no one controls the level of network congestion. The traffic belonging to an enterprise VPN compete for bandwidth resources against countless domestic users browsing for the latest news or only “chatting” with their circumstantial contacts. It can significantly degrade the performance offered by a VPN. Also, the cumulative effects of encryption protocols, which generally produce an increase in packet size (although there are some compression techniques) and introduce an inevitable delay in the end-to-end transmission-reception process, must be considered.

How a VPN constituted

However, let’s see how a VPN built. As the name implies, virtual means that the network that forms the VPN constructed from logical elements rather than physical devices (these certainly exist as the medium that supports the logical network). Unlike traditional links, dedicated lines, for example, VPNs do not maintain permanent links between the endpoints that make up the corporate network. It occurs because the Internet serves as the basis for these connections, and the structure of the Internet is dynamic. When you need to connect two sites, the link created, once it is stopped using, the connection is destroyed freeing resources for other users.

These connections are called tunnels. These may consist of two endpoints, whether these are single computers or networks. Security bridges (gateways) that serve as a filter to stop intruders should include. These bridges can be a “router” or a wall of fire (firewall).

To demonstrate how vital VPNs are, we can now see that the PPTP network protocol already included in the Microsoft Windows NT 4.0, Windows 98 and Windows 2000 operating systems, which allows workstations to connect to a VPN.
As we saw before, what we need at both points of the VPN is to have Internet connections. Of course, on the side of the Central Office, we require links with sufficient bandwidth, and surely the link on this site is permanent. It is recommended to use security devices (firewalls) that separate the network from unauthorized access from the Internet. For users, there are so-called personal firewalls, which have a lower capacity and price. A hardware firewall can cost $ 3,000.00. We can find personal firewalls from $ 20.00 or even free

VPN advantages

It is evident that behind this explosion, there are several benefits over the traditional network that companies have been able to appreciate. The main advantages include:

• Reduced costs: The total cost of ownership (TCO) reduced since bandwidth, trunk equipment and operations are less expensive. In fact, according to Infonetics, a network management consulting company, LAN-to-LAN connectivity costs usually are reduced between 20 and 40% compared to leased line networks, while reducing costs for solutions Remote access estimated between 60 and 80%.

• It makes possible the Internet economy, favoring the agility of the business network – VPNs intrinsically present a more flexible and scalable architecture than classic WANs and, therefore, make it possible for companies to expand their connectivity quickly and profitably, which is conducive to the connection and disconnection of remote offices, international sites, teleworkers, mobile users with local call services (roaming) and the inclusion of external collaborators as required by the company.

• Reduces management problems: Companies can outsource a good part or all of their WAN communications through an operator, making it possible for companies to focus their activities on the essential objectives of their business, instead of having to worry about the management of your WAN network or remote centers.
• Simplify the network topologies: By implementing an IP trunk that eliminates the permanent virtual circuits (PVCs) associated with the connection protocols, such as those of the Frame Relay, a fully open network topology created, thereby complexity and network costs are reduced.
• It serves as a support for the installation of value-added services such as VoIP, Video Conference, etc.

Importance of Virtual Private Networks

The network of networks, the Internet becomes increasingly important. Every day there are faster access speeds, and the range of services offered through the Internet widened. It happens that many companies or institutions, with particular growth, have established branches or terminals which have their computers. In many cases, it is necessary to connect these computers to the central office network. We also have the case of remote users, employees, who connect from home or when they are traveling to, for example, check their email.

One of the solutions that have found to the problem of the remote connection is that of Virtual Private Networks or VPN, according to its acronym in English, which use the open Internet infrastructure to transmit corporate data between offices or branches. When we talk about corporate data, we mean private information to a company or institution.

The intention here is to take advantage of the infrastructure of Internet providers (ISP) to interconnect remote users at a low cost. VPNs allow system administrators to connect the branches of a corporation with the central office in an economical way. Also, they provide remote access to employees while reducing equipment and support spending.
Also, often mobilized employees, such as sales representatives, can connect to the office network from any place where there is access (a phone number) to an Internet provider.

What are the types of e – commerce

By Dinesh Thakur

Types of e – commerce:-

    Business to customer (B to C):-It means the consumer is motivated by business.

 

B to C working

 

1. visiting the virtual mall- customer visits the mall by browsing the outline catalogue.

2. customer registers- customer has to register to become part of the site’s shopper registry

3. customer buys product.

4. merchant processes the order- the merchant then processes the order that is received from the previous stage & fills up the necessary forms.

5. credit card is processed:- credit card of the customer is authenticated thorugh a payment gateway or a bank.

6. shipment & delivery:- the product is then shipped to customer.

7. customer receives:- the product is received by customer and is verified.

8. After sales service:- after sale, the firm wants to maintains a good relationship with its customers. It is called CRM customer relationship management.

       2. Business to business (B to B):- this is called as a business motivated by another business.

 

B2B is classified as:-

 

1. market place:- a digital electronic market place where suppliers and commercial purchasers can conduct transactions.

2. e – distributors:- a company that suppliers products and services directly to individual business.

3. B2B service provider:- it is a company that aells access to internet based software application to another companies.

4. infomediary:- a company whose business model is premised upon gathering information about customers & selling it to other businesses.

3. Consumer to business (C to B):- a business motivated by a customer.

 

The various C2B classified into:-

 

1. idea collectors:- consumers generally have a great idea about how to improve the existing products and what new features can be added to new products. E.g. ideas.com

 

2. reverse auctions:- it allow prospective airline travelers to visit the website and name their price for traval between only pair of city. If an airline is willing to issue a ticket at there price, the passenger is obligated to buy.

 

3. Consumer to consumer (C to C):-

 

In this type, a consumer is motivated by another consumer. Consumers sells directly to other consumers via online classified ads and auctions, or by selling personal services or expertise online. E.g. ebay.com

Limitations of e-Commerce

By Dinesh Thakur

Limitations of ecommerce:

1. Security: the security risk in ecommerce can be
• client / server risk
• data transfer and transaction risk
• virus risk

2. High start up cost:
The various components of cost involved with ecommerce are:-

• connection:- connection cost to the internet.

• hardware / software:- this includes cost of sophisticated computer, moduer, routers, etc.

• maintenance:- this include cost invole in traning of employees and maintenance of web-pages.

3. Legal issues:- these issues arises when the customer data is fall in the hands of strangers.

4. Lack of skilled personnel:- there is difficulty in finding skilled www developers and knowledgeable professionals to manage and a maintain customer on line.

5. Loss of contact with customers:- Sometimes customers feels that they doesnot have received sufficient personal attention.

6. Uncertainty and lack of information :- most of the companies has never used any electronic means of communication with its customers as the internet is an unknown mode for them.

7. Some business process may never be available to ecommerce:- Some items such as foods, high cost items such as jwellery may be impossible to be available on the internet.

advantage of e – commerce

By Dinesh Thakur

Advantage of e – commerce:-

 

1. Facilitates the globalization of business:-e – commerce facilitates the globalization of business by providing some economical access to distant markets and by supporting new opportunities for firms to increase economies by distributing their products internationally.

 

2. Provides increased purchasing opportunities for the buyer:-As e – commerce increases sales opportunities for the seller, it also increases purchasing opportunities for buyer.

 

3. Lowering staffing cost:- As in e – commerce, the selling & purchasing process is outline, the amount of interaction with staff is minimized.

 

4. Market based expansion:- An e – commerce is open to entirely new group of users, which include employees, customers, suppliers & business partners.

 

5. Increased profits:-With e – commerce, companies reach more & more customers where physical commerce cannot reached, thus increasing profits.

 

6. Increased customer service & loyality:- e – commerce enables a company to be open    for business wherever a customer needs it.

 

7. Increase speed & accuracy:- E – commerce see the speed and accuracy with which business can exchange information, which reduces cost on both sides of transactions. It is available 24 hours a day & 7 days a weak.

 

8. Reduction of paper storage.

 

9. Increased response times:- In e – commerce, the interaction with the system take place in real time & therefore allows customer or bidder to respond more quickly & thus reduces the time of discussion between then as in traditional commerce.

ECommerce – What is E-Commerce?

By Dinesh Thakur

Conducting business online. Selling goods, in the traditional sense, is possible to do electronically because of certain software programs that run the main functions of an e-commerce Web site, including product display, online ordering, and inventory management.

The software resides on a commerce server and works in conjunction with online payment systems to process payments. Since these servers and data lines make up the backbone of the Internet, in a broad sense, e-commerce means doing business over interconnected networks.

 

The definition of e-commerce includes business activities that are business-to-business (B2B), business-to-consumer (B2C), extended enterprise computing (also known as “newly emerging value chains”), d-commerce, and m-commerce. E-commerce is a major factor in the U.S. economy because it assists companies with many levels of current business transactions, as well as creating new online business opportunities that are global in nature. Here are a few examples of e-commerce:

 

            Accepting credit cards for commercial online sales.
            Generating online advertising revenue.
            Trading stock in an online brokerage account.
            Driving information through a company via its intranet.
            Driving manufacturing and distribution through a value chain with partners  on an extranet.
            Selling to consumers on a pay-per-download basis, through a Web site.

What is e – commerce ? What are its characteristic

By Dinesh Thakur

The term commerce is define as trading of good & services or if ‘e’ for ‘electronic’ is added to this, the definition of e – commerce is defined as trading of goods, services, information or anything else of value between two entities over the internet.

 Following are some definations of e – commerce:-

 

1. It is the ability to conduct business electronically over the internet.

2. It means managing transactions using networking and electronic means.

      3. It is a platform for selling products & services via internet.

 

Characteristics of e – commerce:-

 

1. Establishment of B to B relationship.

2. Electronic payment.

3. e – distribution of products & services.

4. Exchange of information.

5. Pre and post – sales support.

      6. Customer relationship management.

 

What is the History of E-Commerce?

By Dinesh Thakur

1992 saw the release of Tim Berner-Lee’s World Wide Web. It was with the World Wide Web that the world really began to see the development of E-Commerce as we know it today. By 1994 corporations like Pizza Hut began to take orders for pizza over their website, showing that the World Wide Web was truly beginning to take hold as a commercially viable endeavor.

 

            It was also in this year that the first commercially successful web browser, Mosiac, became available. Marc Andreessen spearheaded its creation which allowed for point-and-click access to the World Wide Web. Mosaic was adapted by Marc Andreessen and Jim Clark into the downloadable Netscape browser.

 

The software was downloadable over the World Wide Web, which made the simple touse browser available to customers everywhere for free. With easy navigation of the World Wide Web and the number of personal computers in use increasing daily, the E-Commerce Boom was well on its way. Over the next couple of years commercial entities began to realize the importance of having their presence on the Web. On-Tutorial Project – WIPO Worldwide Academy Overview of E-Commerce In 1997 DSL (Digital Subscriber Line) service was rolled out in California.

 

This service allowed customers to connect to the internet at speeds fifty times faster than the typical modem dial up speed of 28.8 kilobits per second. It is this continual connection to the Internet, which increases use and drives greater commerce. 1998 saw E-Commerce take off, as companies were selling their services and goods over the Web and accessing clients that they never had access to before the Web. 1998 also saw the privatization of an important aspect of the Web. ICANN (Internet Corporation for Assigned Names and Numbers) was formed in October of 1998. ICANN is a nonprofit, private-sector corporation formed by a broad coalition of the Internet’s business, technical, academic, and user communities.

 

ICANN has been recognized by the U.S. and other governments as the global consensus entity to coordinate the technical management of the Internet’s domain name system, the allocation of IP address space, the assignment of protocol parameters, and the management of the root server system. In 1999 Napster and its creator, Sean Flemming, came into the scene. Napster allowed music files to be transferred over the Web by converting them into MP3 files. This software turned the recording industry on its head and copyright owners everywhere were concerned with the possible ramifications that Pier-to-Pier software may have.

Types of E-Business Models and Markets

By Dinesh Thakur

In the past two years, e-business seems to have permeated every aspect of daily life. In just a short time, both individuals and organizations have embraced Internet technologies to enhance productivity, maximize convenience, and improve communications globally. From banking to shopping to entertaining, the Internet has become integral to daily activities.

For example, just 23 years ago, most individuals went into a financial institution and spoke with a human being to conduct regular banking transactions. Ten years later, individuals began to embrace the ATM machine, which made banking activities more convenient. Today, millions of individuals rely on online banking services to complete a large percentage of their transactions.

The B2B Way

Is the model buyer- or seller-centric? What is the driving force of the business?

 

The greatest strength of the Internet is its ability to bring together people, governments, and businesses and facilitate the flow of information among them. This is one of the main reasons why business models for business-to-business online marketplaces are expected to succeed.

 

It’s clear that the Internet is a viable platform for B2B trade. According to Forrester Research Inc. in Cambridge, Massachusetts, a projected $4.9 trillion in business-to-business (B2B) transactions will be made online by 2004.

 

But private marketplaces being formed by industry leaders represent a more successful model. These real-time supply chains and e-business design systems are phasing out the more expensive and inflexible electronic data interchange networks.

 

The real surprise here is how hard it is to become profitable. The cost of branding technology is so high that consumers still use a catalog. A Web site is just another channel.

What is the Real E-Business Models

By Dinesh Thakur

An e-business model is simply the approach a company takes to become a profitable business on the Internet. There are many buzzwords that define aspects of electronic business, and there are subgroups as well, such as content providers, auction sites, and pure-play Internet retailers in the business-to-consumer space.

 

Given the carnage among dot-com stocks recently, what type of online business models are expected to succeed in the future? Businesses need to make more money than they spend. The new model is the old model, but technology is essential to maintain a competitive advantage, and cash flow is more important than ever.

 

For example, Yahoo Inc. in Santa Clara, California, has always operated a successful portal site, providing content and an Internet search engine. However, many portal sites, such as Go.com, MSN.com, and AltaVista.com, have fallen on hard times.

 

The idea behind portals is the same as that behind television advertising: aggregating eyeballs and directing them toward advertisements. But, television viewers are passive, and people need to wait through the ads to see the shows they want to watch.

 

However, the Web doesn’t work that way. Content presentation is not serial. Viewers are active, not passive. There are always millions of places to go. No Web advertisement can match a 20-second TV spot.

CRM – What is Customer Relationship Management?

By Dinesh Thakur

Customer relationships are becoming a more important factor in differentiating one business from another. In order to stay competitive, e-businesses in every industry have begun to analyze these relationships with customers using CRM solutions.

In the past, customers would place an order via the telephone and wait until the company’s purchasing department processed and shipped the order. Today’s customers place an order electronically and then demand to be able to check the status of their order within minutes.

 

CRM enables an organization to adopt a comprehensive view of the customer and maximize this relationship. These CRM systems enable a business to identify, attract, retain, and support customs centers, direct mail, and retail facilities. In an efficient e-business, there are CRM processes in place to handle:

 

Analytical CRM: The analysis of data created on the operational side of the CRM equation for the purpose of business performance management; utilizing data warehousing technologies and leveraging data marts

 

Customer interactions: Sales, marketing, and customer service (call center, field service) via multiple, interconnected delivery channels and integration between front office and back office

Operational CRM: The automation of horizontally integrated business processes involving “front office” customer touch points

 

Personalization: The use of new and traditional groupware/Web technologies to facilitate customer and business partner communications. Supply Chain Management

 

Integration of the SCM functions is emerging as one of the greatest challenges facing today’s e-businesses. SCM is the integration of business processes from end user through to original supplier. The goal of SCM is to create an end-to-end system that automates all the business processes between suppliers, distribution partners, and trading partners. The new mantra for this process, according to industry analysts, is “replacing inventory with information.” In an effective e-business, the following SCM independent processes must be highly integrated

 

Demand management: These are shared functions, including demand planning, supply planning, manufacturing planning, and sales and operations planning.

Inbound/outbound logistics: These include transportation management, distribution management, and warehouse management.

 

Supply management: These include products and services for customer order fulfillment

What are Encryption-Based VPNs

By Dinesh Thakur

Encryption-based VPNs create a VPN using the public Internet infrastructure. A corporation establishes public Internet connections from each of its office locations to an ISP’s PoP. The corporation can establish the connections with a single ISP or multiple ISPs.

Encryption-based VPNs are susceptible to any weaknesses that the public Internet may experience. Typically, these weaknesses are related to data security and network performance. The original design and implementation of the Internet did not address the security and performance requirements of private networks.

Encryption-based VPNs are often the easiest type of ISP–based private network to create. Several different encryption vendors supply a large range of solutions. Figure 2 shows a typical encryption-based VPN implementation. Each branch office or partner company connects to any ISP; users simply must have access to the public Internet. An encryption device (typically a router or firewall) is placed at each location. The encryption devices receive encrypted data from the other locations and perform the appropriate decryption.

Define Security Issues in Computer Networks.

By Dinesh Thakur

Security issues in computer networks have become one of the most important areas of research with the fantastic proliferation of Internet, and the emergence of a series on sensitive on-line applications. Hiding sensitive transactions from intruders as well as providing a reliable means for authenticating oneself is a very important area of research.

 

The proposed tutorial will provide an overview of the security technologies that have been proposed by researchers over the years, with particular focus on those that have been in popular use. Topics like conventional private-key cryptography, authentication, public key cryptography, digital certificates, steganography, etc. would be covered.

 

Some of the popular security protocols used in common Internet applications would also be discussed, like Kerberos, pretty good privacy (PGP), IP security (IPSec) and secure socket layer (SSL). In the final part of the tutorial, various topics related to intrusion detection and system security would be discussed. Specifically, practical techniques of intrusion detection and prevention in an enterprise network, firewall systems, computer viruses, OS security, etc

What is an Extranet? – extranet advantages and disadvantages

By Dinesh Thakur

One of the last terms included in the networking environment is the word Extranet. An Extranet is nothing more than a virtual private network, using the Internet as a means of transporting information between the nodes of our private network. Thanks to an Extranet you can join two Intranets located anywhere in the world.

Traditionally, transport lines such as X.25, point-to-point connections or, more recently Frame-Relay, were used to link the networks of a corporation located in different cities, countries, and continents. An extranet can consider as part of a company’s intranet that extended to users outside the company. It has also been described as a “state of mind” in which the Internet perceived as a way of doing business with other companies as well as selling products to its customers. The same benefits that HTML, HTTP, SMTP, and other Internet technologies have given the Network and corporate intranets now seem to accelerate business between companies. The advantages of an Extranet are mainly the reduction of costs and the high reliability that there is always an available link.

Extranets advantage

Reliability and low cost: Traditionally private networks implemented with dedicated lines between each headquarters of the company or corporation. A router capable of directing LAN traffic from one headquarters to the LAN of the nearest headquarters installed at each of these locations, always through the data transmission lines (WAN). In the absence of redundancy, the failure of a link prevents communication between sites. A more reliable system is to use a fully meshed network. That is, each headquarters communicates with each other through a link. It makes communications much more expensive, both in the rental of lines and in the cost of routers. Naturally, the additional cost implies an improvement in reliability: The failure of a link does not prevent communication to the other sites because alternative routes can establish. With an Extranet, it is only necessary that each site has a link, usually local, to an Internet access provider. Once on the Internet, the data will be transmitted to the destination headquarters. Naturally, the weak point is the link to the access provider, but the multiple alternative routes offered by the Internet ensure the existence of alternative routes. Therefore, it necessary for each site to have a reliable link to its provider.

With the extranet, reliability gained concerning the use of dedicated lines and costs reduced concerning the use of several dedicated lines (mesh). In many cases, due to international link costs, these options are virtually unfeasible. Only large multinationals can afford this luxury. For the rest of the companies, there is no better alternative, from the economic point of view than an extranet.

Security in Extranets: Firewalls and proxies allow you to protect extranets from unauthorized access by hackers and crackers — encryption used in packages that cross the Internet from one location to another. Authentication is also essential for services such as email. Hence the importance of systems such as SSL (Secure Socket Layer), capable of encrypting information packets and transferring them securely as well as the use of the PPTP protocol (Point-to-Point Tunneling Protocol) which is one of the methods to create a secure “tunnel” through the Internet which is an extension of the famous PPP. PPPT allows establishing multiprotocol virtual private networks over the Internet. The protocols that PPPT currently supports are IP, IPX, NetBIOS, and NetBEUI, that is, most of the protocols used in local area networks. As an extension of the PPP protocol, PPPT limited to point-to-point communications. However, several point-to-point communications can replace a multipoint. Based on the client-server model, it is necessary that the destination network also supports PPPT. Microsoft, with Windows NT Server 4.0 has been the first manufacturer to support this protocol. Applying all these techniques guarantees the security of the Extranet.

Disadvantage of Extranets

The delay in communication. The exponential growth of the Internet does not make it suitable for delay-sensitive traffic. For example, videoconferencing or telephony over the Internet, at present, do not offer the adequate quality of enterprise level. On the other hand, the Internet is a very suitable means for transporting email, file transfer, access to remote databases, etc. that is, traffic not sensitive to delays. Protocols indeed investigated that allow the necessary bandwidth to reserved for each service, but it takes years until it becomes operational and viable. Therefore, it is not advisable to use extranets as an internal telephone or videoconference network.

Purposes and Uses of An Extranet

As Intranets spread within corporations, it seems natural that if there is any need for information exchange between them: customers/suppliers, business partners, etc., the need to interconnect them through the Internet considered.

There is some inertia not to replace traditional EDI systems with “EDI Systems over the Internet”, for some a vision of what an extranet is, especially for reasons of security and robustness of the first against a lack of confidence and normalization in the second. However, there is a field where the use of an extranet seems natural: in those EDI systems that need to reach a mass market. In this way, allowing you to launch an order or view the result of it from a Web browser, known as the Web-EDI model, does not require any specialized software, type EDI station, to enter the world of commercial exchanges without papers. Thus, it is feasible to extend EDI solutions to environments such as booksellers and publishers, pharmacies and pharmaceutical laboratories, etc.; where one of the parties has low investment capacity and is very numerous. However, exchanges of unstructured information such as email, news, etc .; between organizations that have an Intranet built or not, and connect through the Internet; It is as old as the existence of the Internet itself. From this point of view, extranets have always been part of the Internet.

Companies can use an extranet to:

• Exchange large volumes of data using Electronic Data Interchange (EDI).
• Share catalogs exclusively with wholesalers or people within your business or branch.
• Collaborate with other companies in joint development efforts.
• Develop and use training programs with other companies.
• Provide or access services offered by a company to another group of companies, such as the application of online banking managed by a company on behalf of banks affiliated with it.
• Share news of common interest exclusively with partner companies.

Netscape, Oracle, and Sun Microsystems have announced an alliance to ensure that their extranet products can work together through the standardization of JavaScript and the Common Object Request Broker Architecture (CORBA).

Microsoft supports the Point-to-Point Tunneling Protocol (PPTP) and is working with American Express and other companies on an Open Buying on the Internet (OBI) standard. Lotus Corporation is promoting its Notes group software product as a program well suited for use in extranets.