Prentice Hall, 2002 1 Chapter 19 Mobile Commerce

Prentice Hall, 2002 1

Chapter 19

Mobile Commerce


Learning Objectives

Describe the characteristics and attributes of m-commerceDescribe the drivers of m-commerceUnderstand the supportive technologies and their capabilitiesDescribe the wireless standards and transmission networks


Learning Objectives (cont.)

Describe applications of m-commerce to finance, marketing, and customer service

Describe the intra-enterprise applications of m-commerceDescribe B2B and supply chain applications of m-commerceDescribe consumer and personal applications of m-commerce


Learning Objectives (cont.)

Describe some non-Internet m-commerce applicationsDescribe location-based commerce (L-commerce)Describe the major limitations and implementation issues of m-commerce


Illustrative Examples

NEXTBUS—bus riders in San FranciscoInternet-enabled cell phone or PDA helps:

Find estimated arrival time at each stop, in real timeSoon location-based advertisements will pop up—you have time to get a cup of coffee before the bus arrives—Starbuck’s is 200 feet to the right


Illustrative Examples (cont.)

DINE ONE ONE—home delivery from the restaurant in the San Francisco area

100 participating restaurantsFood needs to be delivered hotThe solution

Drivers equipped with AT&T’s PocketNet service—portable smartphonesDispatchers locate drivers, notify where to pick up and deliver food Better service and driver utilization


Illustrative Examples (cont.)

CELL PHONE SERVICES—Smart Search in Hong Kong

Shopping guidesMaps and transportationTicketingNews and reportsGamblingPersonalized movie service


Hardware Generations

DefinitionsAny transaction with a monetary value conducted via a mobile telecommunications networkAny e-commerce transaction in a wireless environmentCan be done via

InternetPrivate communication linesSmart cardsOther infrastructures


Hardware Generations (cont.)

Terminology and generations1G: 1979-1992 wireless technology2G: current wireless technology2.5G: interim technology accommodates graphics3G: 3rd generation technology (2001-2005) supports rich media (video clips)4G: next generation (2006-2010)GPRS: General Packet Radio Services


Terminology and Standards

GPS: Satellite-based Global Positioning SystemGSM: Global System of Mobile CommunicationPDA: Personal Digital AssistantSMS: Short Message Service


Terminology and Standards (cont.)

MMS: Multimedia Messaging ServiceEMS: Enhanced Messaging ServiceUMTS: Universal Mobile Telecommunications SystemWAP: Wireless Application ProtocolSMARTPHONES


Attributes of Mobile Communication

Attributes of m-commerce and its economic advantages

Mobility—users carry cell phones or other mobile devicesBroad reachability—people can be reached at any timeUbiquity—easier information access in a real-time environment


Attributes of Mobile Communication (cont.)

Attributes of m-commerce and its economic advantages (cont.)

Convenience—devices that store data and have Internet, intranet, extranet connectionsLocalization of products and services—knowing where the user is located at any given time


Figure 19-1Characteristics of M-Commerce


The Benefits

Local-based services offer advantagesVendors and carriers differentiate themselves in the marketplaceEnd users can use Web-enabled mobile phone or PDA to access informationInstant connectivity to the InternetPersonalization is available although limited


The Drivers

Widespread availability of devicesNo need for a PCHandset is becoming a cultureVendors’ pushDeclining pricesImprovement of bandwidthExplosion of EC in generalReduces the digital divide


Mobile Computing Infrastructure

Cellular (mobile) phonesAttachable keyboardPDAsInteractive pagers

ScreenphonesE-mail solutionsOther devicesConvergence

Hardware


Figure 19-2Nokia 9290 Communicator

Source: www.nokia.com.


Figure 19-3Palm VIIx Handheld

Source: www.palm.com.


Mobile ComputingInfrastructure (cont.)

SoftwareMicrobrowserMobile client operating system (OS)Mobile application user interfaceBack-end legacy application softwareApplication middlewareWireless middleware


Mobile ComputingInfrastructure (cont.)

Networks and accessWireless transmission media

MicrowaveSatellitesRadioInfraredCellular radio technology

Wireless systems


Figure 19-4Wireless System (Delta Airlines)

Source: ibm.com/software, and delta.com (2000).


Wireless Technology, Standards, and Security

TechnologyMicrobrowsersBluetoothWireless local area networks (WLANs)


Wireless Standards

Wireless standardsTime-division multiple access (TMDA)CDMA OneCode division multiple access (CDMA)Wireless Application Protocol (WAP)W-CDMA (wideband)


Wireless Standards (cont.)

Wireless standardsSubscriber identification module (SIM)Wireless markup language (WML)Voice XML (VXML)Enhanced data rates for global evaluation (EDGE)Universal mobile telecommunications system (UMTS)


Figure 19-5Services and Applications of 3G

Source: NTT DoCoMo publicity


Wireless Security

Wireless security issuesVirusesSmart card security solutionsBack-end security solutions—public key infrastructure (PKI) and M-CERT


Voice Systems for M-Commerce

Hands-free and eyes-free operations increase:

ProductivitySafetyEffectiveness

Disabled people can use voice data for various tasks


Voice Systems for M-Commerce (cont.)

Voice terminals are portable2 ½ times faster than typingFewer errorsVoice portals


M-Commerce Applications

Wireless access provided to existing B2C applicationsExisting wireless intrabusiness and CRM applications enhancedLocation-based applicationsSMS-based applications


Mobile Financial Applications

Swedish Postal Bank

Dagens Industri

Citibank

Japanese banks

Hoover’s wireless (hoover.com)

ASB Bank (New Zealand)Charles SchwabE*TRADESEB in Sweden

Micropayments—wireless Web wallet and bill payments

Examples of financial applications


Figure 19-6Bill Payments by Cell Phone

Source: Courtesy of Nokia at nokia.com.


Mobile Marketing, Advertisement,and Customer Service

Shopping from wireless devices (buy.com)

In 5-10 years most businesses will be wirelessOnline stores will become showroomsUsing voice portals in marketing and customer service

Check on delivery status while away from officeProvide service technicians with diagnostic informationSalespeople check on inventory status during meeting to help close a sale


Figure 19-7Mobile Shopping Supported by CRM


Mobile Marketing, Advertisement,and Customer Service (cont.)

Targeted advertisementPersonalization of services and enhanced user interface for wireless Web pagesGet paid to listen to advertisementsAdvertisement strategies and guidelines


Mobile Marketing, Advertisement, and Customer Service (cont.)

GPS helps target users from their locationVindigo.com—places to go and things to do in your areaC5Solutions.com

Delivers location specific, personalized, specific marketing messages to customersReporting capability on trends and patternsEnterprise-ready scaleable architecture


Mobile Marketing, Advertisement, and Customer Service (cont.)

GPS helps target users from their location (cont.)

GeePS.com—location-based start-up sends coupons to customers cell phonesGo2Online.com—locations-based Web domain helps mobile travelers find anything (e.g., the nearest oil change)


Figure 19-8Wireless CRM

Source: Publicly distributed information from Amdocs Corp. St. Louis, MO (Dec. 2000).


Mobile Applications in the Enterprise

Supporting mobile employees (enterprise solutions)

Smartphones and hand-held devicesEmployees who work on buildings and electrical poles use wearable wireless devices

CamerasScreenKeyboardTouch-panel display


Mobile Applications in the Enterprise (cont.)

Non-Internet applications such as:Wireless networking used for inventory picking in warehousesDelivery and order status updatesService people in the field

DispatchingOnline diagnosis support from remote locationsParts ordering/inventory queriesSalespeople connect to corporate networksRemote database queries


Figure 19-9Automated Workflow Applications

Source: Copyright 2000 MDSI Mobile Data Solutions, Inc. used with permission of MDSI.



Web-based applications (intrabusiness m-commerce), some examples:

Sonera (Finland): electronic funds transfer (EFT) of paychecksChicago’s United Center: inventory can be taken in a matter of hoursFedEx and UPS: access Web, e-mail, databases, intranets, etc.



Job dispatchTransportation (food, oil, newspapers, etc.)Taxis in Korea and Singapore

Utilities (gas, electric, etc.)Field service (computer, office equipment)Health care (visiting nurses, doctors)Security (patrols, alarm installation)Mobile sales force automationIntelligent offices


Figure 9-10Intelligent Office


Supporting the Supply Chain and B2B

Mobile supply chain integrationBoth sell-side and buy-side of ERPUnified messaging makes user’s device less of an issue

Collaboration among members of the supply chain is facilitated by mobile capabilitiesTelemetry drives supply chain efficiency and productivity through automation of:

Data captureImproved billing timeliness and accuracyReduced overheadIncreased customer satisfaction


Supporting Consumer and Personal Services

Mobile gamesMobile musicMobile videoMobile electronic petsMobile betting and gambling

AuctionsTracking athletesHotelsIntelligent homes and appliancesWireless telemedicineOther services for consumers


Figure 19-11Intelligent Home


L-Commerce Applications

Location-based commerce (L-commerce)—applications are specific to user’s locationGlobal positioning systems—satellite-based wireless system enables user to find their location anywhere on earthGeographical information systems (GIS) and GPSGPS on handsets


L-Commerce Applications (cont.)

E-911 emergency cell phone callsWireless carriers must provide feature that allows them to identify number and location of the userMobile 911 calls must be forwarded immediately to the appropriate agency

Telematics—integration of:Wireless communicationsVehicle monitoring systemsVehicle location devices


Figure 19-12Location-Based Services Involving Maps

Source: Based on mapinfo.com


Non-Internet Applications

Smart cardsContactless (proximity) cards used for:

Bus and subway faresRoad tollsVending machines

Amplified remote-sensing cards for toll collectionVehicles do not have to stop at toll booths


Limitations of M-Commerce

Usability problemEffectivenessEfficiencySatisfaction

Lack of standardized security protocol

Security methodology needs to be incorporated in mobileCustomer confidence is low

Insufficient bandwidth

Limits the extent to which mobility can be viewed commodity

3G licensesAuctioned by governmentsCertain countries cannot be served by these devices


Limitations of M-Commerce (cont.)

Transmission limitations

Multipath interferenceWeather and terrain problems

Power consumptionBandwidth increasesPower consumption increasesReduces battery life

Limitations of the 2001 WAP applications

Loading times too slow to keep users interested

Wireless and health hazards

Fear of radiationUnsafe to drive and use wireless phone

Disappointed users


Implementing M-Commerce

Basic (fixed) feesPoint-of-traffic feesTransaction feesContent and service charges

Payment clearingHosting feesCertification (PKI) fees

Revenue models—several sources:


Implementing M-Commerce (cont.)

Consumer confidence and trustCustomers love free or inexpensive services like those offered by iModeCustomers not willing to pay large amounts of money for services unless they trust the product/vendorConfidence should increase with reliable payment mechanismsResearch is being conducted in this area


Implementing M-Commerce (cont.)

M-commerce value chainInvolves many partnersSuccess depends on

Coordination among participantsSufficient compensation for all

Use ASP to deliver m-commerce orLarge companies contract other vendors to complement their services


Managerial Issues

Timing—careful m-commerce strategyWhich applications first?

Location-based advertisement may be attractive, but its effectiveness is unknownCare should be taken in committing sources to m-commerce; but, don’t miss the boat

Which system to use?—multiplicity of:StandardsDevices Supporting hardware and software

Documents

Prentice Hall, 2002 1 Chapter 19 Mobile Commerce