M-COMMERCE
an introduction
last updated 2016 June 13
 
This web page has audio clips - just click on the icon (like the one to the left) and you can hear Prof. Richardson's voice adding additional information to topics on the page. turn on your speakers to hear audio clips
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. This page used in the following courses taught by Prof. Richardson
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MGT D06
CCT 322
MGD 415
BCS 555
MRK 410 / MRK 619
MRK 713
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LEARNING
OBJECTIVES
After completing reading this unit, and listening to the lecture in class, student will have information about:

    o The evolution and adoption of mobile computing
    o The convergence of wireless devices and the Internet creating 
          a new channel to market
    o Some benefits of M-commerce
    o Feasibility of M-commerce
    o "convergence" driving wireless and m-commerce - three converging trends
    o Drivers, Limitations, and Different Applications of M-Commerce
    o Physical Limitations of mobile devices, which need to be addressed
    o Bandwidth and handset design limitations
    o the technology, GSM, CDMA, SIM etc.
    o What does wireless mean to the human experience?
    o Who are some of the early players in the wireless web access developments?
    o M-commerce hype: The fact that m-commerce has not taken off too fast
    o Who's Making Money in Wireless?

WTGR

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http://people.senecac.on.ca/tim.richardson/audio/audiocommentKoreanMcommerce.mp3
Sol L. was a student in MGD415 at UTM in March 2008. Click on Sol's image to hear his comments, in Korean, providing an intro to the concept of m-commerce
s
http://www.youtube.com/watch?v=wBDCWwsi3VE In class we may have a conversation about how humans try to develop technology and systems that strives to replicate, as much as possible, the true human experience, involving all senses, in communication. A video, discussing this points has been posted on YouTube 2009 feb 02

Many of the things we discuss in this unit on m-commerce are consequences of how human develop technology to replicate the human experience.
 
 

WTGR

We have many examples from history - humans developed the concept of the photograph to more accurately represent the human face because artists' renditions were not perfect. Because humans see in colour, it was natural that humans would then develop colour photography. Since we do not see just static images, but rather moving images, it is natural that we would learn to create moving images. And since humans like to see and hear what they sense, it is logical that we would be able to add sound to moving pictures.
http://people.senecac.on.ca/tim.richardson/audio/audiohumans.wav
 http://www.youtube.com/watch?v=wBDCWwsi3VE
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http://www.youtube.com/watch?v=eHyWhkvdKiQ&feature=player_embedded Natalia W. in MGD415 at UTM in the 2nd week of March 2011 created this 2 min video in response to my video discussing how humans develop technology to replicate the human experience.
Natalia made some interesting observations based on an article she read in the Wall Street Journal about bendable screens.
mm
Bendable screens
a 2013 update
Within days of each other (first week of Jan 2013), Queen's University profiled a bendable screen for use in tablets and smartphones,
 www.hml.queensu.ca/paperphone
and Samsung debuts a bendable smartphone screen at the CES show in Vegas.
http://www.youtube.com/watch?v=Rl-qygUEE2c&feature=player_embedded Queen's has a YouTube video explaining how it works.
 youtube.com/watch
?v=Rl-qygUEE2c&feature
=player_embedded
mmm
The origins 
and growth
of mobile and 
wireless 
commerce
clcik to hear
From a White Paper on Personification's web site
 the url was http://www.personification.com/Visual/White/mobilecomp.html

"The rapid growth in mobile telephony in recent years provides a strong model for the adoption of undeterred mobile computing...Nokia estimated that there will be a billion mobile phone subscribers worldwide by 2005.(proven true by the end of 2006, there is now 1 billion cell phone accounts worldwide) The rapid transition from fixed to mobile telephony will almost certainly be followed by a similar transition from fixed to mobile computing in the near future.
Some of the key factors that are driving the evolution and adoption of mobile computing applications is a consequence of:

  • greater reliance on mobile computing and communication technologies. audio
    • since 2010, mobile devices sales exceeded that of personal computers 
  • societal shifts toward a more mobile workforce audio
  • increasing need for remote communication, computing and collaboration 
  • greater geographical mobility among corporate individuals 
  • greater need for communication and collaboration at all levels 
  • greater criticality of time and effective decision making within

  •      narrow  windows of opportunities audio
  • increasing availability of wireless connections at affordable rates audio 
  • new and important requirements for mobile computing support such as
    •      intelligent mobile agents

    •      and mobile knowledge networking."
Permission to use this material for Prof. Richardson's e-commerce courses was given by Dr. Mark Chignell in 2000. In  2003 Personification software technology was acquired by 483330 Ontario Inc.
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The origins 
and growth
of mobile and 
wireless 
commerce
Personification Inc. notes that mobile computing is the fourth wave of an ongoing computing revolution. It follows the earlier mainframe, minicomputer, and microcomputer waves.

Personification Inc. is a Toronto based company involved in ..."humanizing knowledge acquisition" .. as their site said in 1999

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Convergence
Convergence is driving wireless and m-commerce.

Three converging trends

  • increasing use of the internet
  • handheld devices
    • from 2010 - 2014 the number of smartphones worldwide 

    • will grow at an annual rate of 24 percent
  • cellphone services
    • increased competitive and reduction of monopolies will lower prices on airtime and bandwidth usage
    • increasing processor speed will allow smartphones to run more advanced software
      • more apps, more uses
have set the stage for a wireless explosion
 
KEY
POINTS
So, instead of searching for, and reading many articles talking about the coming boom in wireless business - let's accept it will, and concentrate on how it will effect business.

One of the things we have to look at is the physicality of the technology.
WTGR

smartphone growth rate predicted by IDC Research
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During the 3rd week of October 2008 Richardson was interviewed live on CTV Newsnet for a story about the possibility that cellphone and internet use may be effected by an economic downturn in the economy. Richardson provided several examples of how cellphones and the internet are such an integral part of everyday life that it is difficult to imagine much "cutting back" of these technologies and services. Parts of Richardson's interview on TV were also delivered as text on the CTV website.
 www.ctv.ca/servlet/ArticleNews/story/CTVNews/20081023/essentials_study_081023/20081023/
also posted on
 http://people.senecac.on.ca/tim.richardson/video/CTVInterviewOnGPS.wmv
.s
 
clcik to hear Many of the professional service firms, such as the accounting firms, law firms and management consulting companies have addressed m-commerce in the PR material on their websites. PricewaterhouseCoopers had a particularly good note on m-commerce since it addresses the all encompassing aspects of its effect on all business categories.
WTGR

"The convergence of wireless devices and the Internet is creating  an important new channel to market and the next wave of  change across industries. Mobile business, or m-business as it has come to be known, will enable organisations in every  industry to

  • expand their markets, 
  • improve their service and 
  • reduce their costs. 
 Much of the discussion surrounding m-business has been  narrowly focused on m-commerce, a subset of m-business that  involves the use of mobile devices for marketing, selling and buying products and services over the Internet,  "third-generation" (3G) networks or other supporting   technologies. But we believe that m-business is a far greater  and more complex phenomenon one that will build on organisations' e-business transformations and capabilities and provide the backdrop for a further qualitative shift in business  operations. "

formerly at  www.pwcglobal.com/extweb/mcs.nsf/docid/CD62BE635F4F749C852569DD0054B892

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Benefits of M-commerce
 
 
 
 
 
 
 
 
 

 

 
You L., Fei Z., Rohit V. of MRK 410 in March 2004 found this article on the Toshiba site that lists benefits and the feasibility of M-commerce.
from  http://eu.computers.toshiba-europe.com
"M-commerce promises to make shopping easier, more personal and, perhaps, even save consumers time and money"

Some benefits of M-commerce such as: 

  • Usability: Simplicity is key.
  • Convenience and Cost Benefits.
  • Personalisation and Privacy
  • Security
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Benefits of M-commerce Toshiba explains
Feasibility of M-commerce:

"Given the recent tendency to over-hype the promise of wireless technologies and 3G mobile networks, many consumers are sceptical when it comes to predictions about how m-commerce will transform their lives.  According to some IT experts, in the future, consumers will be able to shop using a handheld computing device, PDA, wearable computer or mobile phone. In virtually any place malls, restaurants, hotels, airports and other locations this user will be able to receive coupons, download information, receive sales offers, and perform credit card transactions. In such future scenarios, m-commerce means that customers can shop anywhere, anytime."

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M-commerce
 
 
Andrew Burger wrote in 
E-Commerce Times in January 2007 a three part article titled
"M-Commerce Market on the Move"

E-Commerce Times explains
"Part 1 [ ecommercetimes.com/story/55471.html  ] 
of this three-part series discusses how advances in the delivery of multimedia content to mobile devices are spurring a revolution in digital audio and video distribution and rights management."

"Part 2 [ ecommercetimes.com/story/55554.html]
outlines the revolution taking place among telecom, cable, computing and media companies as they battle for a share of the fast-growing mobile voice, data and multimedia markets."

Part 3 [  ecommercetimes.com/story/55656.html 
Problems: "For all the promise and potential rewards of m-commerce, there are any number of challenges still to be met and kinks to be worked out. Digital rights management continues to be a divisive issue. Major telecom providers continue to resist and restrict opening up their networks to content from third-party distributors and aggregators, although this is changing."
 

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M-commerce

Device Proliferation

WTGR's analysis of M-commerce 

All the opportunities cited in 2006, 2005 and 2004 have had to deal with one giant problem

Too Many Different Devices

You can refer to it is Device Profusion if you like fancy terms, (a term used by Andrew Burger in Jan 2007) but the bottom line is that there are too many players trying to get in on the action, and as a consequence it is tough for companies to try and develop software and hardware that allows a user to use several devices in an interconnected way.

"It seems that in its new life, wireless is facing fewer technological changes and a greater number of business and marketing issues. The industry has followed a tradition of "overpromising and under-delivering," Yankee Group analyst Roger Entner said.
I (WTGR) see the future solution depending on marketing, not technology: ... meaning that successful companies, good at marketing, will (in a Darwinian way) survive, and weaker companies, products, systems will die out.
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M-commerce
 
 
This competitive winnowing out process is necessary in order to minimize the variety of devices and platforms. Vendors can then, more easily, achieve economies of scale by making fewer varieties of a product, and producing larger numbers. The process will allow the few companies left to reap enough profit to sustain their growth.
Imagine that the format for VCR's was not just VHS, but instead there were 10 different formats. Imagine movie studios having to produce their movies in 10 different VCR format's - it would be too expensive and only the top movies would be issued in multiple different formats. 
But, since there is one format, it means when you are making a movie, and it comes time to produce the physical product to sell (the VHS cartridge) , you only have to have one format, VHS. This simpler environment encourages many people to make movies because the cost of making the cartridge is not overly expensive since it does not require multiple formats.
The rationale, just explained above, is why the manufacturers of DVD players developed a consortium in 1995 ( www.dvdforum.org/about-mission.htm ) to make sure that the format for DVD would be standard for all manufacturers. Some have suggested that this convenience has led to an explosion in the movie industry because movies can be made simply by burning one type of file format - which makes it reasonably cheap to mass produce copies of a movie for distribution and sale to the public.
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M-commerce
 
 
The reason for using the allegorical story of VCRs and DVDs re: m-commerce is because the DVD industry (2006-2007) is facing a new problem, similar to the m-commerce challenge of device profusion.
"Hollywood has been unable to decide between two new formats, Blu-ray and HD DVD. Tens of billions of dollars in potential sales hang in the balance." reported Ken Belson of The New York Times when he wrote about the challenges of different DVD formats for High Definition DVD.
Belson explains "...the studios are split over which group to support. Sony's studio and Disney, with 39 percent of the DVD market, back the Blu-ray group, which includes Sony, Panasonic, Hewlett-Packard and others. Warner, Universal and Paramount, with 43 percent of the market, support the HD DVD standard developed by Toshiba and NEC."
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Drivers and Different Applications of M-Commerce

Maria F., Craig S., Daniela S. of MRK410 Found this information on M-Commerce from the University of Nevada at Reno
 

Drivers

"The major drivers are large number of users of Mobil devices, especially cell phones. Using a cell phone is becoming a culture in some places. Prices are declining, venders are pushing it, and EC is growing rapidly. Commerce is driven by its characteristics and attributes."

Different Applications

Finance and Applications
"Many Ec applications in the service industry, such as banking, travel, stocks, and more can be conducted with wireless devices. Shopping can be done from mobile devices, too."
Intrabusiness Applications
"Large number of Intrabusiness applications, including inventory management, sales force automation, wireless voice, job dispatching, wireless office, and more are evident inside organizations"
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Physical Limitations
of mobile devices, 
which need to be 
addressed before 
m-commerce can 
fully develop
click to hear
. .
"Wireless devices and the current wireless technologies still present many obstacles to m-business Wireless services are not available everywhere"
Deitel p. 153
  • wireless Internet service is still relatively expensive audio
  • limited bandwidth restricts data that can be sent audio
  • small screens make it difficult to browse the Web audio
  • wireless devices have smaller memory capacity audio
  • wireless devices have less powerful processors audio
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Physical Limitations
of mobile devices
"Wireless devices demand new models of information delivery and knowledge management," says Dr. Mark Chignell, CTO of Personification Inc. and head of the Interactive Media Lab at the University of Toronto. http://imedia.mie.utoronto.ca/
 
KEY
POINTS
The physical limitations for humans to see a lot of data [text and images] on a small screen, which is presently the configuration for cell phones, requires that
  • the data has to be abbreviated so it will fit on the screen
  • the data has to be altered so it can be received more effectively through the handset
    • suggestions for altering the data include converting text on pages to audible content so it can be listened to through the earpiece of the cellphone instead of viewed on the small screen
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Physical Limitations
of mobile devices
To allow more data to be viewed on the cellphone screen, Personification has developed 2  technologies, namely TextSummary and PhoneSummary
  • "TextSummary uses state-of-the-art algorithms to analyze a document's structure, grammar and keywords generating a coherent summary of the original - without compromising its meaning. 
  • PhoneSummary takes the data generated by TextSummary and converts it to voice. Any web content can be summarized and delivered in  audio format through a telephone."
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Physical Limitations
of mobile devices
"The mobile Internet market is growing quickly, but bandwidth and handset design limitations mean the wireless experience won't match the desktop experience any time soon."

Matt Friedman writing in the Plesman publication, Computing Canada, Nov 2000 (still true in 2006)

Friedman notes that "the mobile market is growing quickly... Sales of Internet-equipped phones  are skyrocketing, while sales of PDAs are expected to double over last year's. There will soon be a vast, mobile Internet-equipped market hungry for content and services."

however, despite this trend, Friedman cautions "...You can't build much of a display into a mobile phone without seriously compromising its portability, and unlike computers, most mobile devices are designed to be operated with one hand.... The killer app for the wireless Internet may not be traditional Web browsing at all at least not in the short term but direct, person-to-business electronic  commerce. In effect, the wireless device becomes a combination of interface, credit card, smart card and ATM."

Computing Canada is published by The Transcontinental ITBusiness Group
© by The Transcontinental ITBusiness Group. permission to quote comes from Joe Tersigni, Publisher, IT Business Group, www.plesman.com.. Copy of email kept on file in the permissions binder.

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KEY
POINTSclick to hear
In reading articles like Friedman's, it should make you aware that many things in the mobile market are undecided at present - there is no certainty as to what technology will be applied, will it be WAP, or something coming after WAP, and it is not certain what customers (the ultimate "voters") will want to do with the new options.

What you should keep in mind in evaluating such articles is the outstanding question of what the customer will want to do with the features that become available. Just because you can add a lot of features to a cell phone doesn't mean people will want to use those features, they may be drawn into separate devices such as the PDAs instead of clogging up the cell phone with too many FABs.

Audio - failure to consider the marketing aspects of a watch

..
 
What does 
wireless mean 
to the human 
experience?
n
http://www.profitguide.com/ "... wireless is really about instant information, a priceless commodity that will let you make decisions and transactions anytime, anywhere"
What is instant information? (WTGR)
  • instant ability to see/read real-time stock quotes as the prices are moved by the market
  • marketing and promotion information cast to you instantly based on your geographic location in an urban area (so you can buy something in close proximity)
  • instant ability to reply to a human (voice, text, or image based content)
.
 
Q. Who are some 
of the early players 
in the wireless web 
access developments?

A - Phone companies

 

"Wireless technology is attracting interest from virtually every industry" 
Deitel p. 155 
  • ISPs - Internet Service Providers
  • Mobile Phone Companies
  • Automobile Manufacturers
    • (the largest manufacturing industry)
  • financial services
    • (in Canada, a banking oligopoly assures they have lots of money)
 
b
Technological Environment

GSM
vs.
CDMA

2008

 

UTM student David S. in MGD415 / CCT322 in Jan 2008 emailed to suggest "a perfect example of how a business is adjusting to the Technological Environment in order to stay competitive." 
 

 

David said

"I was able to apply your teachings recently when I read an online article with references to the 6 Environments Influencing Business.  More specifically, the Technological Environment."

David notes
"Canadian cellular carrier, Telus Corp, is rumored to be humoring a switch to a different wireless platform. The proposed network switch  would effectively move the company from it's current CDMA   platform to  the GSM platform. GSM provides many advantages for Telus as it is a  globally used cellular technology. It would also  allow cheaper roaming costs and a wider selection of mobile devices for consumers."

with info from a National Post article 2008 Jan 15
"Telus move to GSM inevitable, analysts say"
David says
"Canada's only GSM provider is Rogers Wireless. Mobile device manufacturers currently develop handsets for the GSM platform first.  CDMA devices are usually an afterthought, almost arriving a year too  late after their GSM counterpart had debuted. The  switchover to GSM  would also allow Telus to get in on much-hyped   devices such as the  Apple iPhone which is only available as a GSM   device."

The article was at
http://www.nationalpost.com/scripts/story.html?id=238246"

..
Technological Environment

GSM
vs.
CDMA

2008

 

The contribution by David S. prompted me to have a short section on the difference between CDMA  and GSM

CDMA     EVDO     GSM    EDGE  SIM

In cellular service there are two main competing network technologies: 

GSM - Global System for Mobile Communications (see  www.gsmworld.com )
CDMA - Code Division Multiple Access (see  )

The GSM Association is an international organization founded in 1987 (in Europe) and widely used in Asia and Europe

CDMA was developed by Qualcomm in the United States, has been the dominant network standard for North America and parts of Asia

EVDO, also known as CDMA2000, is CDMA's speeded up CDMA with a downstream rate of about 2 megabits per second

EDGE (from GSM) meansEnhanced Data Rates for GSM Evolution - is rates of up to 384 kilobits per second

SIM Subscriber Identity Module (SIM) cards: "In the United States only GSM phones use SIM cards. The removable SIM card allows phones to be instantly activated, interchanged, swapped out and upgraded, all without carrier intervention. The SIM itself is tied to the network, rather than the actual phone. Phones that are card-enabled can be used with any GSM carrier."
from http://www.wisegeek.com/what-is-the-difference-between-gsm-and-cdma.htm

..
ax
What are 
some 
of the 
products 
in 
m-commerce 
in 2005
http://people.senecac.on.ca/tim.richardson/audio/audioalam1.wav Alam (Oct 2005) found a page on the Palm site that is quite useful for students to view in order to get some idea of the range of m-commerce products that are currently popular, + some new products
Click on the icon below to hear his introduction and comments about the Palm site. Alam was in BCS 555.
http://people.senecac.on.ca/tim.richardson/audio/audioalam1.wav(English) click here to hear his comments in Bengali(Bengali)
http://www.palm.com/us/products/
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"... the shift to wireless"
click to hear

April 2000 "Wireless To Dominate Web by 2001" - it didn't happen

Sept 2001  "Study: M-Commerce Faces Slow-Growth Future"

Nov 2001  "Whatever Happened to M-Commerce?"

...
M-Commerce
Hype
 
 
 
 
 

M-Commerce
Hype

KEY
POINTS
The fact that m-commerce has not taken off too fast is a slap in the face to predictions based on the fact that
  • most everyone in urban North America had cell phones
  • the internet infrastructure already existed
so a combination of the 2 should develop fast - but, it hasn't !!
WTGR
 .
Yankee Group mobile analyst Adam Zawel told the E-Commerce Times. "There needs to be a reason to make a purchase using your wireless device. No one's going to bother with an inferior experience on wireless when they can do it on their home PC." 
 
KEY
POINTS
So it would seem that the key to m-commerce taking off is finding some reason to cause people to need to interact with the internet where they are standing (using their cell phone) instead of waiting til they get back to the office, or back home.

One possible killer ap is Business-to-employee applications.

Witiger suggests that a mobile workforce needing to be in touch with regional offices, and the data and information on large servers - will be one of the drivers for m-commerce - it will be considered for reasons of

  • cost saving
  • competitiveness
in terms of delivering services to clients "in the field"
WTGR
 
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..
.On this page there are several quotes from ecommercetimes.com. Permission was given by Richard Kern, Associate Publisher of the E-Commerce Times,  in an email to Prof. Richardson 2004 Dec 10th, a hard copy of the email is kept on file in Richardson's permissions binder.

permission to quote from PROFITguide magazine given by Editor Ian Portsmouth by email 2004 Dec 07. Copy of email kept on file in permissions binder.
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Prof. W. Tim G. Richardson    www.witiger.com 
Creative Commons Attribution-NonCommercial 3.0 Unported License (see  http://creativecommons.org )

- this means other professors and teachers and students can use my stuff for teaching and learning without having to ask first
- it would be nice if you identified me as the source, just refer to witiger.com

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