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ELECTRONICELECTRONIC

COMMERCECOMMERCE

in RUSSIAin RUSSIA

(the very brief survey)

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RussiaRussia

KazanKazan

800 km

MoscowMoscow

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Kazan State University (Russia)Kazan State University (Russia)

Department of Economic CyberneticsDepartment of Economic CyberneticsThe subject of education:

application of mathematical methods and IT

towards the economic problems

The main components of training:

•Economics

•Mathematics E-commerce

•Information Technology

EthicsLaw

...

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Olga A. Kashina (ak@mi.ru, okashina@mail.ru)

Subjects of interest:technological aspects of e-commerce:

Principles of distributed systems organization Web technologies (client & server side) Security issues

Disciplines taught: Web technologies and their application in business and education Scientific applied software for economic solutions

Electronic Guides DevelopmentElectronic Guides Development http://kek.ksu.ruhttp://kek.ksu.ru

http://kek.ksu.ru/okashina.html

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Some Statistics:Some Statistics: According to the analitical digest (www.zametki.ru) of the Russian Internet marketplace activity:

$60 mln was the total amount of salestotal amount of sales (B2C)B2C) in 2000 • $100 mln was the expected amount of sales expected amount of sales (B2C)B2C) in 2001

In October, 2001

• 500500 is the amount of large e-shopsamount of large e-shops ( (www.magazin.ruwww.magazin.ru: February, 2002: 993636))

• 500500 000 is the amount of the active Internet-buyersactive Internet-buyers.• 90% of the assortment: computerscomputers, booksbooks, CDCD, videovideo

36 / 4736 / 47 - there is enough space for growththere is enough space for growth.

According to the report of the METAGROUPMETAGROUP company (www.metagroup.comwww.metagroup.com) that had conducted the comparative analysis of the state-of-the-art in e-commerce in 4747 countries: in October 2001 occupied the 3636-th place. CriteriaCriteria, that were taken into consideration:The total amounttotal amount and the security levelsecurity level of financial transactionsfinancial transactions (4747)The market potentialmarket potential (living standardliving standard & products competitivenessproducts competitiveness ) (4343)TechnologyTechnology: investmentsinvestments in technology improvement (4444)

number of computers per capitanumber of computers per capita (1212)number of Internet-connections per capitanumber of Internet-connections per capita (4747)number of credit cards per capitanumber of credit cards per capita (4545 / 0,0012)

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The AcсentureAcсenture company (www.accenture.comwww.accenture.com) in summer 20012001 has conducted the poll among the heads of the largest companies in 2121 countries, including RussiaRussia.

Here are some figures:

37%37% of Russian companies are actively involved into e-commerce

60%60% of respondents intended to increase the investments into B2BB2B sector (in Russia this rate is 67%67%)

83%83% intended to increase the investments into new IT (mainly, m-commerce) (in Russia - 90%90%)

absolute majority of interrogated officials believe that the Russia’s well-being depends on this sector of economy.

According to the report of the Russian Center of Public Opinion ResearchRussian Center of Public Opinion Research

(www.wciom.ruwww.wciom.ru) overwhelming majorityoverwhelming majority of Russian residents has nevernever used computers•16%16% of population use them regularlyregularly•9%9% – every dayevery day•4%4% – weeklyweekly•1%1% – monthlymonthly.

Some More StatisticsSome More Statistics

American Chamber of Commerce in Russia (www.AmCham.ruwww.AmCham.ru)

•Informational support•Investments into Russian economy In 2001 the American investments to Russian e-commerce: $50mln$50mln(To compare: the total amount of foreign investments to Russian economy in the first half of 2001: $6,7 billion$6,7 billion )

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Internet front-stores:Internet front-stores:

www.ozon.ruwww.ozon.ru ,,

(books, video & music production, software, works of art, rarities)

www.megashop.ruwww.megashop.ru (computer hardware &software, office equipment & accessories , digital cameras, games)

books.rubooks.ru (all kinds of books in Russian and in English)

www.StroyShop.ruwww.StroyShop.ru (B2C+B2B: 1 000 000 items of construction materials & equipment, free delivery, 4 types of payment (no e-payment yet))www.aromat.ruwww.aromat.ru (perfumery)

www.bolero.ruwww.bolero.ru (books, software)

www.cue.ru www.cue.ru (billiard equipment)

www.cup.ru www.cup.ru (tea, coffee, equipment)

www.dostavka.ruwww.dostavka.ru (computers,...)

www.kenga.ru www.kenga.ru (goods for children)

www.tito.ruwww.tito.ru (toys)

www.softline.ruwww.softline.ru (software, books)

Beyond the figuresBeyond the figures:: The agents of the Russian e-market:The agents of the Russian e-market:

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Holding companies:Holding companies:

www.eHouse.ruwww.eHouse.ru•the open system of (1111) most popular e-shops•transportation company (www.skorohod.ruwww.skorohod.ru)•reference system (www.pricematrix.ruwww.pricematrix.ru)•trade system www.ematrix.ruwww.ematrix.ru (for both agents of the Hi-Fi technology market),•advertisement company (www.manifest.ruwww.manifest.ru)•service of banner exchange (wwwwww.bannerbankbannerbank.ruru)

Beyond the figures (continued)Beyond the figures (continued)::

Trade systems:Trade systems:

www.EcomAport.ruwww.EcomAport.ru www.otvet.ruwww.otvet.ru www.ematrix.ru www.ematrix.ruvariety of specialized shops, services, news 2 catalogues: goods & services, companies Hi-Fi tech

The agents of the Russian e-market:The agents of the Russian e-market:

www.StroyShop.ruwww.StroyShop.ru (vertical portal) •Wholesale service•Internet-auction•portal of news at the Russian•market of building materials•encyclopedia on web-resources•Individual order service

www.torg.ru www.torg.ru (horizontal portal)• variety of front-stores (from real estate to rattle toys) • variety of services (law, insurance, delivery, publishing, advertisement, design)

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( According to www.zametki.ru)

•Expanding of the supply assortment, development of B2B section (automobiles, building materials, raw materials, consumer goods)

•Focusing of the assortment, development of e-shops specialized on definite goods (stamps, seeds of garden plants, goods for pets, fishing &hunting facilities) or services (esp.related to the digital information retrieval and processing)

•Development of marketing activity

•Development of the delivery services (up to the moment it s the most weak звено)

•Development of the supplementary services (consultations, delivering of more detailed consumer information, e-facilities for making the choice (design of a house interior, virtual fitting-rooms, virtual techniques for make-up selection)

•Expenditures reducing via cooperation (web-server hardware & software acquisition and maintenance, IT and accountancy staff salary, products delivery, ...)

•Integration of markets (B2C+C2C, B2C+B2B), development of Internet-auctions

•Development of Internet-advertisement

•m-commerce development

•Development of e-payment systems

What than?What than?The tendencies of e-commerce in RussiaThe tendencies of e-commerce in Russia

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Due to www.zametki.ru it is expected that by 2006 e-payment will be almost total.

CyberPlatCyberPlat ((www.cyberplat.ruwww.cyberplat.ru))

AssistAssist ( (www.assist.ruwww.assist.ru) ) PayCashPayCash ( (www.paycash.ruwww.paycash.ru))WebMoneyWebMoney ( (www.webmoney.ruwww.webmoney.ru))Russian Shopping Club (www.russianshopping.com)

Elit (www.elit.ru)

instant!(www.paybot.com/defaultrus.asp)

interRussia (www.interRussia.com)

E-money vs ususal oneE-money vs ususal oneThe e-payment systems used in RussiaThe e-payment systems used in Russia

e-cashe-cash – a technology, having 2 principle features: the possibility to conduct the payments without transferring funds from one bank account to another the anonymity of the payments.

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December 2001. CyberPlat System Processed First Payments Made on Board a Space Orbital Station. Russian spacemen Vladimir Dejourov and Michael Tiourin have purchased flowers and gifts for their relatives in he Internet shops, where spacemen. All purchases were delivered to their destinations at the time.

Coming back to figures…Coming back to figures…CYBERPLAT GOES TO SPACE

20012001: number of e-shops: 177177 (6060 new in 2001) (now: 186186) number of goods & services: > 1 million1 million turnover: RRRR 1.68 billion 1.68 billion ($57.4 million$57.4 million)(88 times larger than in 2000) number of purchases: 600 000 600 000 (now: 650730650730; daily: 900900) market share (in the segment of the on-line card-based Internet- payments): 90-95%.90-95%.(twice larger than in 2000).

According to the annual report of CyberPlat 2001 was extraordinarily eventful and effective from both the system development point of view and in view of the financial targets attained. The company has not only preserved but actually consolidated and strengthened its grounds in the B2C market and has turned into a leader of B2B market.

www.cyberplat.ruwww.cyberplat.ru

The "Dealer On-Line" project is being implemented together with the Vympelkom company operating under its trademark - BeeLine . 22 dealers involved.It has monthly doubling turnover. (In June, 2001 = 300% ).

Main features: •multibank operations strategy (1313 banks)•wide spectrum of payment tools

One more important event of 2001 is the company's entry into American Chamber of CommerceAmerican Chamber of Commerce.

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Coming back to figures…Coming back to figures…20012001: Turnover: WMR – RR 53 466 618RR 53 466 618; WMZ - $10 774 412$10 774 412;Number of transactions: WMR - 58 05058 050; WMZ - 348 606348 606;New registrations: 90 95390 953Amount of unique hosts connected to the system: 173 876173 876 www.webmoney.ruwww.webmoney.ru

1)1) monthly amountamount and numbernumber of WMZ transactions

2)2) monthly amountamount and numbernumber of WMZ transactions

3)3) number of connected hostsconnected hosts and newnew registrationsregistrations

www.assist.ruwww.assist.ru

ASSISTASSIST is a leader at Russian Internet- market and conducts more than 80%80% of the total amount of Internet-transactions. (??????)

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E-payment systems: what is the difference? E-payment systems: what is the difference? ((www.i2r.ruwww.i2r.ru))

I. type of e-paymentsI. type of e-payments (type of participating agents):

B2B

С2B

C2C

TypeType

B2C

bank-bank

ParticipantsParticipants TraditionalTraditional analoguesanalogues ExamplesExamples

Juridical ps.

Consumers(buyers),

Juridical ps. (sellers)

Clearing between organizations

CyberPlat

Cash & funds transfer

WebMoney

ConsumersCash,

postal orders, cable transferWebmoneyPaycash

Consumers (sellers),Juridicals (buyers)

The very low value of the bargain (ex: jokes: $0.01/unit)

Eaccess Phonepay

Banks - SWIFT

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E-payment systems: what is the difference? E-payment systems: what is the difference? ((www.i2r.ruwww.i2r.ru))

I. type of e-paymentsI. type of e-payments (type of financial operations ):TypeType ApplicationApplication ExamplesExamples

Card account control

e-checks &other payment obligations

Plastic cards (credit or debit type) Cyberplat

(Cyberpos) Self-contained systems

of inter-corporative payments Cyberplat

(Cybercheck)

e-cash Payments to consumers, e-analogues of tokens and cards,

paid in advance

PaycashWebmoney

Bank account control Systems of "client-bank" type with the access via modem or cellular

phone

Telebank ("Gouta-bank")

Funds transfer without

bank account opening Funds transfer via computer networks similar to post or

wireless transfer

AnelikWestern UnionMoney Gram

Contact

Internet-banking service:100 commercial banks; 10 e-payment systems.

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E-payment systems: what is the difference?E-payment systems: what is the difference?

II. II. technological principle technological principle TypeType SecuritySecurity principle principle ExamplesExamples

Systems with central

server Smart-cards

Secret access keys Telebank ("Gouta-bank")"Internet Service Bank"

Hardware techniques Mondex, ACCORD-card

Client-side e-wallets Secure data exchange protocols,

reliable cryptography algorithms

PaycashWebmoney

Paid telephone call Secure central database with PIN-codes,

hardware techniques, reliable telephone networks

Eaccess, Phonepay

Other criteria: • Currency types (only RR, only USD, both of them...)• Targeted market of goods and services (physical, digital,both of them)• Volume of transactions

www.emoney.ruwww.emoney.ru

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Latest EventsLatest Events

““E-Russia in 2002 - 2010E-Russia in 2002 - 2010”” (the Federal Targeted Program) was signed by Russian prime-minister Michail Kasianov on January, 30.

It is aimed on the development of IT and its implementation to the state management and economy.

The total amount of finance involved in implementation of this program is RR 76 billionRR 76 billion, including51% 51% – from the State Federal Budget,30%30% – from the Local Subjects of Federation Budgets,19%19% – from non-state sources.In 2002 the RR 600 mlnRR 600 mln are allotted from the Federal Budget.

““Internet & Investments”Internet & Investments” (the International Forum, April, 25-26, St.-Petersburg)•The state-of-the-art in IT-investments in in the world and Russia•The prospect of e-commerce in the world and in Russia•The fund-rising issues•The specific features of e-commerce development in Russia, America and Europe, …

V Conference V Conference on E-Commerce on E-Commerce

in Russiain Russia (October, 31 – November, 1, St.-Petersburg)

““Secure IT for Secure IT for business, business, government government and civil and civil interaction”interaction”, (March, 28 – 29, Moscow)

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Online resourcesOnline resources

WWW.MAGAZIN.RUWWW.MAGAZIN.RU::•catalogue of e-shops (936)•catalogue of on-line auctions (13),•catalogue of books and periodical press on e-commerce in

Russian •links to the payment systems sites www.emoney.ru •announcements of events •materials of seminars and conferences•links to the news spiders lordtime.com.ua/news/

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P.S. P.S. You are welcome:You are welcome: http://uwphoto.ruhttp://uwphoto.ru

E-shop of computer hardware & software, books, peripheral devices .