Fundamentals of Computing and E-Commerce

ADP
Lecture # 5

E-Commerce

Complied by:
Rana M, Naveed Lecturer of Computer Science
Lecturer of Computer Science
University of Central Punjab
Gujrat Campus
Gujrat Campus.
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Transmission Media:
The means through which data is transformed from one place to another is
called transmission or communication media

Types of Transmission Media:

There are two categories of transmission media used in computer

communications.

1) Bounded/Guided Transmission Media

2) Unbounded/Unguided Transmission Media

1) Bounded/Guided Transmission Media:

It is the transmission media in which signals are confined to a specific path
using wire or cable. The types of Bounded/ Guided are discussed below.

i. Twisted Pair Cable:

This cable is the most commonly used and is cheaper than others. It is
lightweight, cheap, can be installed easily, and they support many different
types of network.
Twisted Pair is of two types:

Unshielded Twisted Pair (UTP)

 Shielded Twisted Pair (STP)
Advantages:
 Installation is easy
 Flexible
 Cheap
 It has high speed capacity,
 100 meter limit
 Higher grades of UTP are used in LAN technologies like Ethernet.

Complied by:
Rana M, Naveed Lecturer of Computer Science
University of Central Punjab
Gujrat Campus.
 3

ii. Coaxial Cable:

Coaxial is called by this name because it contains two conductors that are
parallel to each other. Copper is used in this as center conductor which can
be a solid wire or a standard one. It is surrounded by PVC installation, a
sheath which is encased in an outer conductor of metal foil, barid or both.
Outer metallic wrapping is used as a shield against noise and as the
second conductor which completes the circuit. The outer conductor is also
encased in an insulating sheath. The outermost part is the plastic cover
which protects the whole cable.

Advantages:
 Bandwidth is high
 Used in long distance telephone lines.
 Transmits digital signals at a very high rate of 10Mbps.
 Much higher noise immunity
 Data transmission without distortion.
 The can span to longer distance at higher speeds as they have better
shielding when compared to twisted pair cable

Complied by:
Rana M, Naveed Lecturer of Computer Science
University of Central Punjab
Gujrat Campus.
 4

iii. Fiber Optic Cable:

These are similar to coaxial cable. It uses electric signals to transmit data.
At the center is the glass core through which light propagates.
In multimode fibers, the core is 50microns, and In single mode fibers, the
thickness is 8 to 10 microns.
The core in fiber optic cable is surrounded by glass cladding with lower
index of refraction as compared to core to keep all the light in core.

Advantages:
 Provides high quality transmission of signals at very high speed.
 These are not affected by electromagnetic interference, so noise and
distortion is very less.
 Used for both analog and digital signals.

2) Unbounded/Unguided Transmission Media:

Unguided or wireless media sends the data through air (or water), which is
available to anyone who has a device capable of receiving them. Types of
unguided/ unbounded media are discussed below:
 Microwave
 Satellite
 Infrared

Complied by:
Rana M, Naveed Lecturer of Computer Science
University of Central Punjab
Gujrat Campus.
 5

i. Microwave:
In this type of communication the sender is required to be in the receiver. It
energy is focused on having energy in a beam and it travels in straight
line. Antennas are used which are aligned for transmitting and receiving.
Any obstructions like building can obstruct microwaves from travelling.

ii. Satellite Microwave:

This type of communication requires sending the relay station in space,
thus to be prevented from atmosphere. The signals from Satellite are used
across the world. These satellites are placed in space with the use of
Rockets and Space shuttles.

Complied by:
Rana M, Naveed Lecturer of Computer Science
University of Central Punjab
Gujrat Campus.
 6

iii. Infrared:
Infrared light transmissions have existed for many years and their use
having been limited to TV remote controls and wireless slide projector
remote controls. However, they now are assuming a position of some, if still
limited, importance.

E-Commerce:

Electronic commerce is an emerging concept that describes the process of

buying and selling or exchanging of products, services and information via
computer networks including the internet.

E-commerce Classification:
A common classification of EC is by the nature of transaction:

Business-to-Business (B2B):
Electronic market transactions that take place between organizations.

Business-to-Consumer (B2C):
Retailing transactions with individual shoppers – typical shopper at
Amazon.com is a consumer.

Consumer-to-Consumer (C2C):
Consumer sells directly to consumers, examples -individuals selling in
classified ads, auction sites allowing individuals to put up items for auction
– e.g., e-bay.

Complied by:
Rana M, Naveed Lecturer of Computer Science
University of Central Punjab
Gujrat Campus.
 7

Consumer-to-Business (C2B):
Individuals who sell products or services to organizations and those who
seek sellers and conclude a transaction.

Advantages and Disadvantages of E-Commerce:

The invention of faster internet connectivity and powerful online tools has
resulted in a new commerce arena – Ecommerce. Ecommerce offered
many advantages to companies and customers but it also caused many
problems.
Advantages of Ecommerce:

 Faster buying/selling procedure, as well as easy to find products.

 Buying/selling 24/7.

 More reach to customers, there is no theoretical geographic

limitations.
 Low operational costs and better quality of services.

 No need of physical company set-ups.

 Easy to start and manage a business.

 Customers can easily select products from different providers without

moving around physically.

Disadvantages of Ecommerce:

 Any one, good or bad, can easily start a business. And there are
many bad sites which eat up customers’ money.

 There is no guarantee of product quality.

 Mechanical failures can cause unpredictable effects on the total

processes.

Complied by:
Rana M, Naveed Lecturer of Computer Science
University of Central Punjab
Gujrat Campus.
 8

 As there is minimum chance of direct customer to company

interactions, customer loyalty is always on a check.

 There are many hackers who look for opportunities, and thus an
ecommerce site, service, payment gateways; all are always prone to
attack.

E-Business Revenue Models:

A business model is defined as the organization of product, service and

information flows, and the source of revenues and benefits
for suppliers and customers. The concept of e-business model is the same
but used in the online presence. Following are some popular online
businesses that one currently finds on the web:

1) Storefront Model:
It represents basic form of e-commerce where buyers and sellers interact
directly. Merchants need to organize online catalog of products, take orders
through their websites, accept payments in a secure environment and send
items to the customers. They can also store and manage customer data in
databases. A storefront model uses the shopping cart technology which
allows customers to accumulate items they want to buy during shopping.
This is quite popular in B2C transactions.

2) Auction Model:
In this model there are auction sites to which the users can log-on and
assume the role of a bidder or seller. As a seller, one has to specify the
minimum price to sell one’s item (called reserve price), the description of
the item and the deadline to close the auction. At the end of the auction,
the seller and the bidder are notified by the auction site and the payment
mechanism and delivery mode is worked out. Auction sites charge
commission on sales.

3) Online Banking:
There is an online bank providing banking services to the customers
through internet including services of electronic funds transfer.

Complied by:
Rana M, Naveed Lecturer of Computer Science
University of Central Punjab
Gujrat Campus.
 9

4) Online Trading and Lending:

Online trading is buying and selling of stocks/shares of listed companies
using internet. Many brokerage houses have established an online
presence. Online lending is providing loan through an internet transaction.

5) Online Recruiting:
Employers can recruit and job searchers can search for jobs effectively
through online recruiting web sites.

6) Online News Services:

Many newspapers/magazines have online presence, providing 24-hour
updates. Online publishing is attractive because printing and distribution
costs are not involved in it.

7) Online Travel Services:

One can make travel arrangements online without going to travel agent. It
is convenient and less costly. There are online businesses which help
customers find discount fares for airline tickets, hotel rooms and rental cars
or assist in case of lost luggage.

8) Online Entertainment
Internet technology can quickly provide information with high quality
multimedia. Therefore, such business have emerged which sell music
albums, movie tickets, video films etc. The content can be easily
downloaded by the customer in this case.

9) E- Learning:
Universities and various training institutes are offering high-quality distance
education over the web. EBooks and other reading material can be easily
downloaded to one’s computer. Virtual University is an example of this type
of business model.

Complied by:
Rana M, Naveed Lecturer of Computer Science
University of Central Punjab
Gujrat Campus.
 10

BARRIERS TO INTERNATIONAL E-COMMERCE

E-commerce is a combination of three different areas of study, namely,

technology, business and law/policy. We have studied the technology and
business side of e-commerce to a reasonably good extent.

Barriers to International E-commerce:

Barriers to international ecommerce include lack of trust, lack of

infrastructure, language and culture.

Lack of Trust:
It is very important for online businesses to establish trusting relationships
with their customers like in the physical world where companies ensure that
customers know who they are. However, it is difficult to build trust because
a kind of anonymity exists for companies trying to establish web presence.

Language:
Only way to do business in other cultures is to be a part of such cultures.
Language plays a very important role in this regard. In the first step you
should provide local language versions of your web site. Software
packages exist that can translate your web site content into different
languages. Some sites translate all of their pages, but if the web site is very
large then one can be selective in translation effort.

Culture:
It should be useful to know about different cultural issues surrounding
international e-commerce. Firstly, there is the issue of choice of name. For
example, a famous car manufacturing company had chosen the name
‘nova’ for one of its car models, which could be understood by the people in
Latin America in the sense that ‘it will not go’.

Complied by:
Rana M, Naveed Lecturer of Computer Science
University of Central Punjab
Gujrat Campus.
 11

Infrastructure issues:

Internet infrastructure includes computers and software connected to

internet and communication networks over which data packets can travel.
In many parts of the world, telecommunication industry is either owned by
the government or is strictly regulated by the government.

E-MAIL MARKETING

E-mail marketing campaigns are cheap and effective way to target potential
customers. E-mails can instantaneously convey a marketing message to
customers at distant areas. Personalized direct e-mails target customers
with specific information – name, right product at the right time, special
promotions etc. When your e-business is doing global marketing, e-mails
can be first translated into proper languages as a personalization measure
using specific translation software. Personalization technology (data
mining) can also improve response rate tremendously. Where an e-
business lacks resources for doing e-mail marketing on its own, it can
outsource such campaign to outside firms. For instance, outsourcing
services should be used when direct e-mailing becomes too difficult to
manage and there is inadequate staff or technical support at the e-business
level itself.
E-mails can be used to improve customer service by adding an e-mail link
to your web site. Thus, you can receive your customers’ complaints through
e-mails.

Complied by:
Rana M, Naveed Lecturer of Computer Science
University of Central Punjab
Gujrat Campus.