The document discusses the introduction to electronic commerce. It describes traditional commerce versus e-commerce, and how e-commerce uses the internet and networks to automate business transactions. It explains the development of computer networks and the internet, and the role of the world wide web in facilitating electronic commerce. It defines value chains as how activities are organized to design, produce and deliver products/services. E-commerce helps create new opportunities through online sales, branding and relationships.

1. IT 2031 - ELECTRONIC COMMERCE
THEORY NOTES

2. UNIT I INTRODUCTION 9
Traditional commerce and E commerce – Internet and WWW – role of WWW – value
chains – strategic business and Industry value chains – role of E commerce.
UNIT II INFRASTRUCTURE FOR E COMMERCE 9
Packet switched networks – TCP/IP protocol script – Internet utility programmes – SGML, HTML and XML –
web client and servers – Web client/server architecture – intranet and extranets.
UNIT III WEB BASED TOOLS FOR E COMMERCE 9
Web server – performance evaluation - web server software feature sets – web server software and tools
– web protocol – search engines – intelligent agents –EC software – web hosting – cost analysis.
UNIT IV SECURITY 9
Computer security classification – copy right and Intellectual property – electronic commerce threats –
protecting client computers – electronic payment systems – electronic cash – strategies for marketing –
sales and promotion – cryptography – authentication.
UNIT V INTELLIGENT AGENTS 9
Definition and capabilities – limitation of agents – security – web based marketing – search engines and
Directory registration – online advertisements – Portables and info mechanics – website design issues.
TOTAL: 45 PERIODS
TEXT BOOKS:
1. Ravi Kalakota, “ Electronic Commerce”, Pearson Education.
2. Gary P Schneider “Electronic commerce”, Thomson learning & James T Peny Cambridge USA, 2001.
3. Manlyn Greenstein and Miklos “Electronic commerce” McGraw-Hill, 2002.
REFERENCES:
1. Efraim Turvan J.Lee, David kug and chung, “Electronic commerce” Pearson Education Asia 2001.
2. Brenda Kienew E commerce Business Prentice Hall, 2001.

3. UNIT I INTRODUCTION
1.Traditional commerce and E commerce
2.Internet and WWW
3.Role of WWW
4.Value chains
5.Strategic business and Industry value chains
6.Role of E commerce

4. Traditional commerce and E
commerce
Traditional commerce:
• face-to-face, telephone lines or mail systems
• manual processing of traditional business transactions
• individual involved in all stages of business transactions
E-Commerce:
• using Internet or other network communication technology
• automated processing of business transactions
• individual involved in all stages of transactions pulls
together all activities of business transactions, marketing
and advertising as well as service and customer support

5. Comparison

6. Taxonomy of e-commerce

7. Taxonomy of e-commerce
• e-commerce is about the sale and purchase of goods or
services by electronic means, particularly over the
internet.
• two types of commerce: physical commerce and e-
commerce.
• In a physical or traditional commerce system,
transactions take place via contact between humans
usually in a physical outlet such as a store.
• For example, if you want to buy a book, you will go to a
physical bookstore and buy the physical book from a
salesman. In a pure e-commerce system, transactions
take place via electronic means.

8. Comparing Traditional Commerce and
Electronic Commerce – Buyer’s Side

9. Comparing Traditional Commerce and
Electronic Commerce – Seller’s Side

10. Internet and WWW
• A computer network is any technology that
allows people to connect computers to
• each other. Computer networks and the
Internet, which connects computer networks
around the world to one another, form the
basic technology structure that underlies all
electronic commerce.

11. Origins of the Internet
• In the early 1960s, the U.S. Department of Defense
became concerned about the possible effects of
nuclear attack on its computing facilities.
• The Defense Department realized that the weapons of
the future would require powerful computers for
coordination and control.
• The power ful computers of that time were all large
mainframe computers, so the Defense Department
began examining ways to connect these computers to
each other and also connect them to weapons
installations distributed all over the world.

12. Origins of the Internet
• In 1969, Defense Department researchers in
the Advanced Research Projects Agency
• (ARPA) used this network model to connect
four computers—one each at the University of
California at Los Angeles, SRI Inter national,
the University of California at Santa Barbara,
and the University of Utah—into a network
called the ARPANET.

13. Origins of the Internet
• Main Purpose - control weapons systems and transfer
research files, other uses for this vast network began
to appear in the early 1970s.
• In 1972, Ray Tomlinson, wrote a program that could
send and receive messages over the network.
• In 1979, a group of students and programmers at Duke
University and the University of North Carolina started
Usenet, an abbreviation for User’s News Network.
• Between 1979 and 1989, these network applications
were improved and tested by an increasing number of
users

14. Commercial Use of the Internet
• In 1989, the National Science Foundation (NSF)
permitted two commercial e-mail services, MCI Mail
and CompuServe, to establish limited connections to
the Internet for the sole purpose of exchanging e-mail
transmissions with users of the Internet.
• In 1991, the NSF further eased its restrictions on
commercial Internet activity and began implementing
plans to privatize the Internet.
• Internet was based on four network access points
(NAPs) located in San Francisco, New York, Chicago,
and Washington, D.C., each operated by a separate
telecommunications company.

15. Growth of Internet
NOW = 1 Billion (Sep 14), 100 crores
• These companies, known as network access
providers, sell Internet access rights directly to
larger customers and indirectly to smaller firms
and individuals through other companies, called
Internet service providers (ISPs).

16. Role of WWW
• The Web is software that runs on computers that
are connected to the Internet.
• In 1989, Tim Berners-Lee was trying to improve
the laboratory research document handling
procedures for his employer, CERN: European
Laborator y for Particle Physics.
• Over the next two years, he developed the code
for a hypertext server program and made it
available on the Internet.
• Berners-Lee called his system of hyperlinked
HTML documents the World Wide Web.

17. Role of WWW
• A hypertext server is a computer that stores files
written in the hypertext markup language and
lets other computers connect to it and read these
files. Hypertext servers used on the Web today
are usually called Web servers.
• A Web browser is a software interface that lets
users read (or browse) HTML documents and
move from one HTML document to another
through text formatted with hypertext link tags in
each file.

18. Role of WWW
• Internet Protocols – TCP & IP
• Web Page Request and Delivery Protocols
-HTTP
• Electronic Mail Protocols- SMTP, POP, IMAP
• Unsolicited Commercial E-Mail(UCE)-Spam /
Bulk / Junk Mails.

19. Value - Chains
• A value chain is a way of organizing the activities
that each strategic business unit undertakes to
design, produce, promote, market, deliver, and
support the products or services it sells.
• In addition to these primary activities, Porter also
includes supporting activities, such as human
resource management and purchasing, in the
value chain model.
• Two types : Strategic business and Industry value
chains.

20. STRATEGIC BUSINESS UNIT VALUE CHAINS
Value chain for a strategic business unit engaged in manufacturing a

21. STRATEGIC BUSINESS UNIT VALUE
CHAINS
• Primary Activities :
1) Identify customers - market research and
customer satisf action.
2) Design - concept to manufacturing.
3) Purchase materials and supplies - vendor
selection, vendor qualification, contracts, and
monitoring quality and timeliness of delivery
4) Manufacture product or create service
5) Market and sell
6) Deliver.

22. STRATEGIC BUSINESS UNIT VALUE
CHAINS
• Supporting Activities :
1) Finance and administration - activities that
provide the firm’s basic infrastructure including
accounting, paying bills, borrowing funds,
reporting to government regulators, and ensuring
compliance with relevant laws
2) Human resources - activities that coordinate
the management of employees
3) Technology development - activities that help
improve the product or service.

23. Industry Value Chains
• The industry value chain identifies opportunities
up and down the product’s life cycle for
increasing the efficiency or quality of the
product.

24. Industry Value Chains
• Better business strategy
• Increased revenue
• Effective utilization of resources.
• Management can identify many business
opportunities, including those that can be
exploited using electronic commerce

25. Role of E-Commerce
Cheaper upfront cost to the merchant, it's easier to set up
and open the store. Create a world of opportunity .
Benefits :
1) Helps Create New Relationship Opportunities
2) Open for Business 24x7
3) Increases Brand or Product Awareness
4) Helps Establish Customer Loyalty
5) Potential to Increase Overall Business Sales
6) Potential to Increase Company Profits
7) Potential to Decrease Some Costs
8) Expands Geographical or Customer Reach
9) Allows for Smaller Market or Niche Targeting
10)Allows for Easier Delivery of Information