chapter 7 e-commerce: the internet, intranets, and extranets

Management Information Systems, 4th Edition

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Chapter 7E-Commerce: The Internet,

Intranets, and Extranets


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Learning Objectives

• Explain how the Internet functions

• List the features for information exchange that can be conducted over the World Wide Web

• Explain how the Web facilitates electronic commerce

• Explain basic business models on the Web


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What is the Internet?• The Development of the Internet

– ARPANET was open system designed for the free flow of information, but available only to members of academic institutions and some in the defense industry.

– U.S. government decided to split the network into a civilian one and a military one

• Civilian network became the Internet

– Internet is now a network of networks


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What is the Internet? (Cont.)


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Growth of the Internet• Number of servers

– 147 million in mid-2003

• Number of users

– More than 600 million; 10 percent of the world population


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Growth of the Internet (Cont.)


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Growth of the Internet (Cont.)


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Growth of the Internet


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How the Internet Works

• Definitions

– Uniform Resource Locator (URL)

– Hypertext Transfer Protocol (HTTP)

– Domain Name

– Hypertext Markup Language (HTML)

– Top Level Domain (TLD)


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How the Internet Works (Cont.)


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• IP Number

• Domain Naming System (DNS)

• A domain name is assigned to each IP address

• Domain names are registered by one of a group of companies authorized to assign unique names

Internet Domains


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Internet Domains (Cont.)


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Internet Addressing


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• Static:

– Servers and many other computers and devices are assigned a permanent IP number

• Dynamic: – A computer connected to the Internet intermittently

may be assigned a temporary IP number for the duration of its connection only

Static and Dynamic IP Numbers


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Common Internet Applications

• Email

• File Transfer

• Newsgroups and Blogs

• Instant Messaging

• Internet Telephoning

• Web Browsers


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The World Wide Web• Web Software

– HTML and XML

– Web Page Editors

– Java, JavaScript, and ActiveX

– Web-Application-Interfaces

– VRML

– Cookies


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The World Wide Web (Cont.)


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Intranets and Extranets– Intranet

• A within-organization computer network that uses Internet technologies to communicate

– Extranet

• Uses Internet technologies to facilitate communication and trade between an organization and its business partners, such as suppliers


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Intranets and Extranets (Cont.)


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Establishing an E-CommerceWeb Site

• Several Options1. Installing their own server2. Contracting with an ISP3. Contracting with a Web portal4. Establishing an electronic storefront5. Contracting with a Web hosting service6. Using a virtual Web server7. Setting up a subdomain


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• Dedicated Server

– Expensive option with the greatest degree of control

– Requires expertise

– Specialists needed maintain the server

• Load balancing transfers visitor inquiries from a busy server to a less busy server

Establishing an E-CommerceWeb Site (Cont.)


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• ISP Site

– Low-fee or free space for individual or business Web sites.

– Many small businesses avoid this option

– Can give the appearance that such online businesses are ephemeral



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• Web portal– Limited space and design control

• Electronic Storefront– Cybermall

• Web Hosting Service

• Virtual Web Server

• Subdomain



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Business-to-Business Trading

• Electronic Data Interchange

• Exchanges and Auctions

• Online Business Alliances

• Application and Storage Service Providers


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• Advertising

– Unique visitors per month

– Unique visitor pages

– Reach percentage

– Banners

Business-to-Consumer Trading


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Business-to-Consumer Trading (Cont.)


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• E-retailing– Customer Relationship Management (CRM)– Consumer Profiling

• Auctions and Reverse Auctions• Content Providers• Software Sales• Stock Trading• Distributed R&D



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• Target the right customer

• Own the customer’s total experience

• Personalize the service

• Shorten the business cycle

• Let the customers help themselves

• Be proactive

Rules for Successful Online Business Transactions


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• Niche Retailing

• Selling Hard-to-obtain information

• Click-and-mortar retailing

• Rules for Successful Web Page Design

• E-Government

• M-Commerce

Successful Business Models


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E-Commerce Practices on the Internet


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Management Challenges and Solutions

• Reduced Control over Information Resources

• Reduced Budgetary Control

• Cost/Benefit Analysis

• Scalability

• Security

• Education


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E-Commerce is Every Commerce

• Web technologies have been integrated into the business world

• Information that flows inside an organization actually uses the Internet segments of intranets

• Businesses not yet on the Internet will eventually be there


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Online Annoyances

• Spam

• Pop up Windows

• Adware and Spyware


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Summary

• How the Internet functions

• Information exchange over the Internet

• The web facilitates electronic commerce

• Business models on the Web

chapter 7 e-commerce: the internet, intranets, and extranets

Documents

internet cont

internet works cont

internet technologies

extranets cont

internet addressingstatic

internet functionslist

ecommerceweb site cont

business web sites