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COMP3410 - I.T. in Electronic Commerce
eTrading
Topic Outline

Roger Clarke **

Version of 13 September 2009

© Xamax Consultancy Pty Ltd, 2000-2009

This document is at http://www.rogerclarke.com/EC/ETIntro.html

Introduction

This five-hour segment of COMP3410 - I.T. in Electronic Commerce - deals with various models underlying the trading of goods and services, the kinds of technologies required to support them, and a couple of sample applications.

The examinable material includes:

• the Required Readings
• the slide-sets
• any additional material provided during lectures

The Additional, More Advanced Reading is not examinable. It's provided in order to enable you to 'drill down' on topics you're particularly interested in.

Contents

• Overview
• Lecture Outlines
• Lecture Topics, Readings and Slides
  • Lecture 1
  • Lecture 2
  • Lecture 3
  • Lecture 4
  • Lecture 5
• Additional, More Advanced Reading
• Tutorial Discussion Topics

Overview of the eTrading Segment

The fundamental concept is 'market'. The elements of marketplaces and marketspaces are explained, and an outline is provided of the processes whereby trading occurs. Many different kinds of market exist, and more are being dreamt up. Which form is appropriate depends on a number of factors:

• the category of tradable goods and services. Productised items are quite distinct from custom-built items, and different families of technologies and services are needed to support trading in them
• the category of trading partners and their relationships. The distinctions will be drawn between B2B, B2G, B2C and C2C segments, and consideration given to the various ways in which participants in a marketspace can be connected with one another
• the commercial basis under which the trading is conducted, including sale for cash, barter, subscriptions, sponsorship, indirect recompense and deferred recompense
• the extent to which the purchaser invests effort into the selection process. This distinguishes deliberative purchasing (formal processes that organisations, and occasionally individuals, engage in when they are making a decision with significant economic consequences) from spontaneous purchasing

With the maturation of electronic trading, it appears likely that a larger proportion of contracts may be effected by means of auctions. This term refers to a number of somewhat different, formalised processes whereby prices are set for the exchange of goods or services.

Several technology issues are introduced. The parallel explosions in mobile devices and wireless connectivity are creating new challenges. Payment mechanisms are seriously inadequate. The security of transactions, especially the payment aspects of transactions, are badly undermined by malware.

There's a widespread presumption that, in cyberspace moreso than in meatspace, you need to know who you're doing business with. To test the prevailing presumptions about identities in marketspaces, it's necessary to study the concepts of identification, of anonymity and pseudonymity, and of authentication, together with the technologies that threaten and support the privacy of individuals.

Finally, an increasing amount of exchange is taking place between individuals, in what can be called 'consumer-to-consumer' eTrading. Sometimes money changes hands, but some of these markets involve 'sharing', which is a form of barter. Peer-to-peer (P2P) technologies have quickly become mainstream. This segment identifies the serious challenges that currently exist, particularly in the context of digital versions of copyright objects.

Lecture Outline

Lecture 24: Conceptual Foundations

When trading occurs, whether good, old-fashioned, physical trading or facilitated by electronic tools, it involves 'markets', 'tradable items', trading partners, relationships among them, various ways of 'doing the deal', and business processes to support the activity. Without an understanding of these concepts, eTrading designs can be confidently predicted to be disastrous failures.

Lecture 25: Some Key Technology Issues

eTrading utilises available information infrastructure. Several aspects of I.T. are still failing to deliver, a half-century after computers were first applied to business. This session provides an overview of two key technology topics. The rapid migration towards mobile commerce is one aspect. The other is the diverse forms of malware, which represent a complex and increasingly sophisticated challenge.

Lecture 26: Identity in Marketspaces

The effectiveness of a trading scheme depends on trust by participants in one another's behaviour, and in the infrastructure supporting the activity. Identification (of parties and of tradable items) is one factor. Developing confidence in the assertions that parties make, referred to as 'authentication', is crucial. Biometric technologies have potential benefits, but bring with them significant risks. The roles of anonymity and pseudonymity also need to be understood.

Lecture 27: eTrading in Digital Objects, incl. P2P

eTrading in music has been a battleground for over a decade, and the large 'music labels' are only just beginning to come to terms with the changes wrought by digitisation. This session delivers the essentials of the legal framework within which music (and other digital objects) are bought and sold - copyright. An overview of Peer-to-Peer (P2P) technologies enables a discussion of the sharing and trading of digital objects.

Lecture 28: Carbon Trading

Most scientists believe that we're in a phase of 'global warming', and that an important reason for it is our emissions of 'greenhouse gases'. Economists argue that 'emissions trading schemes' will solve the world's problem. Any such scheme will inevitably be an eTrading scheme. How does the information contained in the previous 4 sessions help us design infrastructure to support eTrading in carbon?

Lecture 1: Conceptual Foundations

Tue 15 September, 13:00-14:00, PHYS T - (Slides in 6-up PDF)

Sub-Topics and Required Readings:

All readings are quite short sections, so (although the list seems long) it won't take you much time to get the readings done

1. eTrading, Markets, Marketspaces:
   • Underlying Definitions
   • Commercial Approaches to Trading (section 3.1)
   • Markets (section 3.1)
2. Tradable Items
   • Categories of Tradable Items
   • Products, Commodities, Customisation and Custom-Built (just the section on those four categories)
3. Trading Partner Relationships
   • Categories of Trading Partners
4. Trading Partner Topologies
   • Alternative Topologies for Supra-Organisational Systems
5. Processes
   • Deliberative Procurement
     • Definitions of the Phases of the Deliberative Procurement Approach
   • Spontaneous Purchasing
     • Definition of Spontaneous Purchasing
     • Spam (Background only)
     • Cookies (Background and Applications only)
     • Principles and Practice of Effective Direct Marketing (sections 6.1 and 6.2 only)
6. Auctions
   • Wikipedia entries for Auctions, Online auction tools, Auction software and Online auction business model

Lecture 2: Some Key Technology Issues

Tue 15 September, 14:00-15:00, PHYS T - (Slides in 6-up PDF)

Sub-Topics and Required Readings:

• Mobile Commerce (Internet and Cellular)
  • Wireless Transmission and Mobile Technologies (sections 1-3 only!)
• Malware
  • Categories of Malware
  • The Wikipedia Entries (only the generic information is examinable. Fine details, and the names and specific characteristics of particular threats and instantiations are too detailed to remember, and are rapidly changing)

NOT INCLUDED THIS YEAR:

I couldn't find space for ePayment Schemes, which are still very poorly developed, but appear to be going through another phase of change

Lecture 3: Identity in Marketspaces

Wed 16 September, 12:00-13:00, JD 101 - (Slides in 6-up PDF)

Sub-Topics and Required Readings:

1. (Id)entification and Authentication
   • Terminology
2. Identity Management
   • Identity Management (that section only, i.e. 'Myth 6')
3. Biometrics
   • Biometrics (sections on Biometrics; How It Works; Uses; and Effectiveness, Accuracy and Benefits)
4. Nymity
   • Anonymity and Pseudonymity (sections 3.3 and 3.4 only)
   • Id, Anonymity and Pseudonymity on the Internet (section 7 only)
   • 'Corporate Case in Ohio Raises Questions on Internet Anonymity' (NYT, 17 October 2000)
5. PITs and PETs
   • Introducing PITs and PETs: Technologies Affecting Privacy
6. Dig Sigs and PKI
   • The Applicability of Conventional PKI (section 5.4 only)

Lecture 4: eTrading in Digital Objects, incl. P2P

Wed 23 September, 12:00-13:00, JD 101 - (Slides in 6-up PDF)

Sub-Topics and Required Readings:

1. Copyright
   • I.P. and Copyright (sections 2.1 and 2.2)
2. Copyright Objects
   • Copyright Objects (sections 2.3 and 2.4)
3. Technological Protections / DRM
   • Passive and Active Protections (sections (3) and (4))
4. P2P
   • Peer-to-Peer (P2P) - An Overview
5. eSharing Digital Objects using P2P
   • Peer-to-Peer (P2P) - An Overview
   • Wikipedia on P2P, including the catalogue of networks, protocols and applications
6. eTrading Digital Objects using P2P
   • Watch this space. Quality materials on this topic are frustratingly difficult to find ...

Lecture 5: Carbon Trading

Tue 14 October, 13:00-14:00, PHYS T - (Slides in 6-up PDF)

Sub-Topics and Required Readings:

1. Global Warming, and why Carbon Trading is being considered
2. eTrading in Carbon
   • Clarke R. (2009) 'An eCommerce Perspective on Carbon Trading' Proc. 22nd Bled eCommerce Conf., Slovenia, June 2009

Additional, More Advanced Reading

• Overview
  • A Taxonomy of B2B e-Commerce Schemes
• Direct Electronic Marketing
  • Direct Marketing and Privacy
  • Spam
  • Cookies
• Auctions
  • A Longstanding, Low-Tech Electronic Auction (skim it)
  • A Modern Electronic Auction (C2C)
  • A Modern Electronic Auction (B2B)
  • The Views of Technology Provider Ariba on B2B eTrading in Australia (3 October 2000)
  • Problems with B2B (The Economist, 21 October 2000)
  • Auction, from Wikipedia
  • Online auction business model, from Wikipedia
• Online Gambling
  • The Technical Feasibility of Regulating Gambling on the Internet, esp. sections 2.1, 3, 5 and 6
  • On-Line Gambling: Authentication and Identification Technologies and Issues (references and PowerPoint slides)
• Electronic Services Delivery
  • Electronic Services Delivery: From Brochure-Ware to Entry Points
• ePayments
  • Modes of Payment (section 3.2)
  • Getting Paid on the Internet (by Credit Card)
  • Net-Based Payment Schemes
  • Overview of SET
• Malware
  • The Feasibility of Consumer Device Security. Read all of it. Only s.4 is examinable!! (and ss. 4.2 and 4.4 are especially important), but those sections won't make sense unless you read it all
• Location and Tracking
  • You Are Where You've Been
• Identification, Anonymity and Pseudonymity
  • Human Identification
  • The Digital Persona
• PETs
  • Anonymity and Pseudonymity Services
  • Tools
• Privacy-Sensitive Public Key Infrastructure
  • Conventional PKI (whole of section 5)
  • Privacy Requirements of PKI
  • Pretty Good Privacy (PGP)
  • Simple Public Key Infrastructure (SPKI)
  • Simple Distributed Security Infrastructure (SDSI)
• Electronic Publishing / Trading in Copyright Objects
  • Electronic Publishing As a Form of Electronic Commerce
  • A Workshop in Electronic Publishing
  • Copyright
  • Electronic Trading in Copyright Objects and Its Implications for Universities
• P2P
  • P2P's Significance for eBusiness
• Carbon Trading
  • Relevant Wikipedia Entries, incl. Emissions Trading, Kyoto Protocol and European Union Emission Trading Scheme
  • Point Carbon

Discussion Topics for Tutorial

1. Is each of the following a market, a marketplace and/or a marketspace, and who are the buyers, the sellers and the marketspace operator?
   • your local corner shop
   • a suburban parking area that, each Saturday morning, is full of people trying to sell their cars privately
   • an on-line share broker
   • Open Day at the A.N.U.
   • Graduate Recruitment Events at the A.N.U.
   • Sourceforge
2. Distinguish commodities from standard products.
3. What category of tradable item is the degree that you're enrolled in?
4. Identify tradable items that companies commonly buy using the 'spontaneous purchasing' technique, and that people commonly acquire using 'deliberative purchasing' approaches. Do companies ever purchase spontaneously?
5. Why are auctions more commonly used for commodities than for custom-built and customised goods and services?
6. Describe three ways in which you are taking a risk when you buy or sell using a mobile device.
7. Give examples of marketspaces in which participants are very likely to be concerned about protection of their identity and their personal data. What are currently the most practical ways for people to protect their id? And which privacy-enhancing technologies look like being the most effective in the future?
8. Identify strengths and weaknesses in the University Coop Bookshop's Online Service. How good a grasp does the organisation appear to have of:
   • cyberspace behaviour and net ethos?
   • the characteristics and needs of University students?

Author Affiliations

Roger Clarke is Principal of Xamax Consultancy Pty Ltd, Canberra. He is also a Visiting Professor in the Department of Computer Science at the Australian National University,, and in the Cyberspace Law & Policy Centre at the University of N.S.W.

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The content and infrastructure for these community service pages are provided by Roger Clarke through his consultancy company, Xamax. From the site's beginnings in August 1994 until February 2009, the infrastructure was provided by the Australian National University. During that time, the site accumulated close to 30 million hits. Sponsored by Bunhybee Grasslands and the extended Clarke Family

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Created: 19 March 2000 - Last Amended: 13 September 2009 by Roger Clarke - Site Last Verified: 15 February 2009
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