|
|
|
|
E-Commerce Unleashed
|
 |
|
January 22, 2001
By Peter Rysavy
|
|
Dot-com businesses may be falling by the wayside, but the percentage of commerce happening via the Web continues to grow. Meanwhile, hundreds of millions of cellular subscribers worldwide are gaining access to new wireless data choices, including Web-enabled cell phones, handheld computers and PDAs. Combine these two facts, and you get an industry with an unbelievable potential called mobile commerce, or m-commerce.
|
|
Not convinced? How about this: A woman is looking at a DVD player in a store and is ready to buy, but she isn't sure if the store is offering the best price. Using the microbrowser on her cell phone, she quickly determines that your online enterprise is selling the player for 10 percent less; she purchases it from you right then for delivery the next day. Or, you send your subscriber an alert on his Palm to let him know tickets have just gone on sale for one of his favorite performers, before the subscriber even knows the singer is coming to town. Within minutes, the customer selects the best seats in his price range and purchases tickets from you.
Whether this convinces you or not, International Data Corp. forecasts that $21 billion worth of mobile commerce will take place in 2004, while Gartner Group predicts that 40 percent of B2C (business to consumer) e-commerce in that same year will occur over wireless connections. Already, the big e-commerce players, such as Amazon.com and Yahoo, are offering mobile options. What's not to love? Actually, plenty.
Content and applications must still be developed in multiple mobile formats. Security questions continue to dog the industry. And evolving payment systems and networks are barely up to the task. In fact, the wide range of wireless networks, markup languages and devices has made developing mobile-commerce applications so complex that most organizations seeking to mobilize applications need help.
Fortunately, help is available from a rapidly expanding array of middleware solutions, wireless portals and wireless ASPs (application service providers). As part of our investigation of this industry, we sent out a detailed RFI (request for information) to middleware vendors and ASPs to learn about their approaches for enabling mobile-commerce applications. (See "Mobile-Commerce ASPs Do the Legwork".)
Evolution of an Industry
The first big wireless applications, deployed in the early 1990s, were field service and dispatch. Both applications facilitate commerce but do not involve transactions. We focused on mobile-commerce applications that involve actual transactions, in which a user securely purchases or sells goods or services. Current choices are a tiny subset of what will become possible with new location technology, financial settlement systems, devices and networks.
Here's how we see the market evolving:
- This year, companies will extend their e-commerce applications to mobile devices but will rely on existing settlement systems, such as charging a user's credit-card account. Examples of such applications are financial trading, buying tickets, ordering from restaurants, updating financial portfolios, conducting banking transactions (such as transferring funds between accounts) and comparison shopping. Financial-trading applications are leading the way, as customers can derive clear and immediate benefits (see "E-Trade Brokers Wireless Access").
- Now available in limited form, electronic wallets will facilitate transactions by providing a centralized way for users to maintain account and shipping information. Electronic wallets, whether hosted by portals, ASPs, banks or carriers, will play an increasingly important role in mobile commerce. Major sites, such as Yahoo, already support wallet mechanisms. Credit-card companies also are actively involved in this area. Expect dozens of such systems to crop up by the end of the year, which might cause some confusion among application developers and customers.
- Around 2002, new location technology will enable mobile-commerce applications that take a user's location into account. Based on user preferences that address privacy issues, these applications will give users access to localized and personalized information. For example, after dinner at a restaurant, someone could use his or her PDA or cell phone to get a list of movies playing at the closest theater, obtain show times and purchase tickets.
- Beginning around 2002 but evolving over the decade, new financial settlement systems will allow secure transmission of electronic cash on a wide- or local-area basis. ECash Technologies is one of the pioneers in this area. To buy a Coke from a vending machine, for instance, a user will be able to press a couple of keys on a mobile device to transfer electronic tokens -- the equivalent of virtual coins -- to the machine over a local wireless connection such as Bluetooth. This capability will apply to in-store purchases as well. In effect, mobile devices could begin to replace cash, checks and credit cards. The implications for everyone -- merchants, consumers and banks alike -- are huge.
What devices will people be using? Initially they'll use smart phones with microbrowsers -- typically based on HDML (Handheld Device Markup Language) and WAP (Wireless Application Protocol) -- and handheld computers with wireless modems. But these categories are blurring, with cell phone modules available for handheld computers and OSes being built into cell phones. In fact, the multiplicity of devices -- not to mention physical differences, such as screen sizes -- makes developing content a big challenge.
What will drive mobile commerce will be a billion users of mobile networks within several years, with every one of those users interested in buying products and services more conveniently. But what's convenient to users spells challenge and complexity to merchants and integrators. And we mean technical complexity. We're not even going to touch the business complexities of developing profitable m-commerce applications.
|
|
|
|
|
|
|
|
RSS
