Electronic commerce, commonly known as e-commerce or eCommerce, or e-business consists of the buying and selling of products The noun product is defined as a "thing produced by labor or effort" or the "result of an act or a process", and stems from the verb produce, from the Latin prōdūce '(to) lead or bring forth'. Since 1575, the word "product" has referred to anything produced. Since 1695, the word has referred to "thing or things or services A service is the intangible equivalent of a good. Service provision is often an economic activity where the buyer does not generally, except by exclusive contract, obtain exclusive ownership of the thing purchased. The benefits of such a service, if priced, are held to be self-evident in the buyers willingness to pay for it. Public services are over electronic systems such as the Internet and other computer networks A computer network, often simply referred to as a network, is a collection of computers and devices connected by communications channels that facilitates communications among users and allows users to share resources with other users. Networks may be classified according to a wide variety of characteristics. This article provides a general. The amount of trade conducted electronically has grown extraordinarily with widespread Internet usage. The use of commerce is conducted in this way, spurring and drawing on innovations in electronic funds transfer Electronic funds transfer or EFT refers to the computer-based systems used to perform financial transactions electronically. An EFT is the electronic exchange or transfer of money from one account to another, either within the same financial institution or across multiple institutions, supply chain management Supply chain management is the management of a network of interconnected businesses involved in the ultimate provision of product and service packages required by end customers (Harland, 1996). Supply Chain Management spans all movement and storage of raw materials, work-in-process inventory, and finished goods from point of origin to point of, Internet marketing Internet marketing, also referred to as i-marketing, web-marketing, online-marketing or e-Marketing, is the marketing of products or services over the Internet, online transaction processing Online transaction processing, or OLTP, refers to a class of systems that facilitate and manage transaction-oriented applications, typically for data entry and retrieval transaction processing. The term is somewhat ambiguous; some understand a "transaction" in the context of computer or database transactions, while others define it in, electronic data interchange Electronic data interchange is the structured transmission of data between organizations by electronic means. It is used to transfer electronic documents from one computer system to another, i.e. from one trading partner to another trading partner. It is more than mere e-mail; for instance, organizations might replace bills of lading and even (EDI), inventory management Inventory is a list for goods and materials, or those goods and materials themselves, held available in stock by a business. It is also used for a list of the contents of a household and for a list for testamentary purposes of the possessions of someone who has died. In accounting inventory is considered an asset systems, and automated data collection systems. Modern electronic commerce typically uses the World Wide Web The World Wide Web, abbreviated as WWW and commonly known as the Web, is a system of interlinked hypertext documents accessed via the Internet. With a web browser, one can view web pages that may contain text, images, videos, and other multimedia and navigate between them by using hyperlinks. Using concepts from earlier hypertext systems, British at least at some point in the transaction's lifecycle, although it can encompass a wider range of technologies such as e-mail Electronic mail, commonly called email or e-mail, is a method of exchanging digital messages across the Internet or other computer networks. Originally, email was transmitted directly from one user to another computer. This required both computers to be online at the same time, a la instant messenger. Today's email systems are based on a store-and- as well.

A large percentage of electronic commerce is conducted entirely electronically for virtual The term has been defined in philosophy as "that which is not real" but may display the salient qualities of the real. Colloquially, 'virtual' is used to mean almost, particularly when used in the adverbial form e.g. "That's virtually [almost] impossible" items such as access to premium content on a website, but most electronic commerce involves the transportation of physical items in some way. Online retailers are sometimes known as e-tailers Two distinct categories of e-tailers are pure plays and bricks and clicks. A pure play e-tailer uses the Internet as its primary means of retailing. Examples of pure play e-tailers are Dell and Amazon.com. A brick and click e-tailer uses the Internet to push its goods or service but also has the traditional physical storefront available to and online retail is sometimes known as e-tail. Almost all big retailers have electronic commerce presence on the World Wide Web The World Wide Web, abbreviated as WWW and commonly known as the Web, is a system of interlinked hypertext documents accessed via the Internet. With a web browser, one can view web pages that may contain text, images, videos, and other multimedia and navigate between them by using hyperlinks. Using concepts from earlier hypertext systems, British.

Electronic commerce that is conducted between businesses is referred to as business-to-business Business-to-business describes commerce transactions between businesses, such as between a manufacturer and a wholesaler, or between a wholesaler and a retailer. Contrasting terms are business-to-consumer (B2C) and business-to-government (B2G) or B2B. B2B can be open to all interested parties (e.g. commodity exchange) or limited to specific, pre-qualified participants (private electronic market A private electronic market uses the Internet to connect a limited number or pre-qualified buyers or sellers in one market. PEMs are a hybrid between perfectly open markets (e.g. exchanges where there is no pre-existing relationship between buyer and seller - similar to eBay) and closed contract negotiations (such as a sealed bid tender, where). Electronic commerce that is conducted between businesses and consumers, on the other hand, is referred to as business-to-consumer An example of a B2C transaction would be a person buying a pair of shoes from a retailer. The transactions that led to the shoes being available for purchase, that is the purchase of the leather, laces, rubber, etc. as well as the sale of the shoe from the shoemaker to the retailer would be considered transactions or B2C An example of a B2C transaction would be a person buying a pair of shoes from a retailer. The transactions that led to the shoes being available for purchase, that is the purchase of the leather, laces, rubber, etc. as well as the sale of the shoe from the shoemaker to the retailer would be considered transactions. This is the type of electronic commerce conducted by companies such as Amazon.com Amazon.com, Inc. is an American-based multinational electronic commerce company. Headquartered in Seattle, Washington, it is America's largest online retailer, with nearly three times the Internet sales revenue of the runner up, Staples, Inc., as of January 2010. Online shopping Online shopping is the process whereby consumers directly buy goods, services etc. from a seller interactively in real-time without an intermediary service over the Internet. If an intermediary service is present the process is called electronic commerce. An online shop, eshop, e-store, internet shop, webshop, webstore, online store, or virtual is a form of electronic commerce where the buyer is directly online to the seller's computer usually via the internet. There is no intermediary service. The sale and purchase transaction is completed electronically and interactively in real-time such as Amazon.com for new books. If an intermediary is present, then the sale and purchase transaction is called electronic commerce such as eBay.com eBay Inc. is an American Internet company that manages eBay.com, an online auction and shopping website in which people and businesses buy and sell a broad variety of goods and services worldwide. Founded in 1995, eBay is one of the notable success stories of the dot-com bubble; it is now a multi-billion dollar business with operations localized.

Electronic commerce is generally considered to be the sales aspect of e-business Electronic business, commonly referred to as "eBusiness" or "e-business", may be defined as the application of information and communication technologies in support of all the activities of business. Commerce constitutes the exchange of products and services between businesses, groups and individuals and can be seen as one of. It also consists of the exchange of data to facilitate the financing and payment aspects of the business transactions.

History

Early development

The meaning of electronic commerce has changed over the last 30 years. Originally, electronic commerce meant the facilitation of commercial transactions electronically, using technology such as Electronic Data Interchange Electronic data interchange is the structured transmission of data between organizations by electronic means. It is used to transfer electronic documents from one computer system to another, i.e. from one trading partner to another trading partner. It is more than mere e-mail; for instance, organizations might replace bills of lading and even (EDI) and Electronic Funds Transfer Electronic funds transfer or EFT refers to the computer-based systems used to perform financial transactions electronically. An EFT is the electronic exchange or transfer of money from one account to another, either within the same financial institution or across multiple institutions (EFT). These were both introduced in the late 1970s, allowing businesses to send commercial documents like purchase orders A purchase order is a commercial document issued by a buyer to a seller, indicating types, quantities, and agreed prices for products or services the seller will provide to the buyer. Sending a PO to a supplier constitutes a legal offer to buy products or services. Acceptance of a PO by a seller usually forms a one-off contract between the buyer or invoices An invoice or bill is a commercial document issued by a seller to the buyer, indicating the products, quantities, and agreed prices for products or services the seller has provided the buyer. An invoice indicates the buyer must pay the seller, according to the payment terms. The buyer has a maximum amount of days to pay these goods and are electronically. The growth and acceptance of credit cards A credit card is a small plastic card issued to users as a system of payment. It allows its holder to buy goods and services based on the holder's promise to pay for these goods and services. The issuer of the card grants a line of credit to the consumer from which the user can borrow money for payment to a merchant or as a cash advance to the, automated teller machines An automated teller machine or the automatic banking machine (ABM) is a computerized telecommunications device that provides the clients of a financial institution with access to financial transactions in a public space without the need for a cashier, human clerk or bank teller. On most modern ATMs, the customer is identified by inserting a (ATM) and telephone banking Telephone banking was a service provided by a financial institution which allows its customers to perform transactions over the telephone in the 1980s were also forms of electronic commerce. Another form of e-commerce was the airline reservation system typified by Sabre Sabre is a computer reservations system/global distribution system used by airlines, railways, hotels, travel agents and other travel companies. Sabre GDS is a unit of Sabre Holdings' Sabre Travel Network division. Current North American hosted carriers include Alaska Airlines, American Airlines, WestJet, Cape Air, Frontier Airlines, Hawaiian in the USA and Travicom In 1976, Videcom with British Airways, British Caledonian and CCL launched Travicom, the world's first multi-access reservations system, , forming a network providing distribution for initially 2 and later 49 subscribing international airlines (including British Airways, British Caledonian, TWA, Pan American World Airways, Qantas, Singapore in the UK.

From the 1990s onwards, electronic commerce would additionally include enterprise resource planning Enterprise resource planning is an integrated computer-based system used to manage internal and external resources including tangible assets, financial resources, materials, and human resources. It is a software architecture whose purpose is to facilitate the flow of information between all business functions inside the boundaries of the systems (ERP), data mining Data mining is the process of extracting patterns from data. Data mining is seen as an increasingly important tool by modern business to transform data into an informational advantage. It is currently used in a wide range of profiling practices, such as marketing, surveillance, fraud detection, and scientific discovery and data warehousing A data warehouse is a repository of an organization's electronically stored data. Data warehouses are designed to facilitate reporting and analysis.

An early example of many-to-many electronic commerce in physical goods was the Boston Computer Exchange Boston Computer Exchange was the world's first e-commerce company, and dominated electronic trading in used computers in the US in the 1980s. The Boston Computer Exchange, also called the BCE and BoCoEx, were in operation before the Internet became widely available to the general public. Their Bulletin Board System-based marketplace utilized, a marketplace for used computers launched in 1982. An early online information marketplace, including online consulting, was the American Information Exchange The American Information Exchange , was a platform for the exchange of information, ideas, and certain kinds of intellectual work product, created by economist and futurist Phil Salin in the 1980s, another pre Internet^{[clarification needed]} online system introduced in 1991.

In 1990, Tim Berners-Lee Sir Timothy John "Tim" Berners-Lee, OM, KBE, FRS, FREng, FRSA , is a British engineer and computer scientist and MIT professor credited with inventing the World Wide Web, making the first proposal for it in March 1989. On 25 December 1990, with the help of Robert Cailliau and a young student at CERN, he implemented the first successful invented the WorldWideWeb WorldWideWeb, later renamed to Nexus to avoid confusion about the software and the World Wide Web, was the first web browser and editor. When it was written, WorldWideWeb was the only way to view the Web web browser A web browser is a software application for retrieving, presenting, and traversing information resources on the World Wide Web. An information resource is identified by a Uniform Resource Identifier and may be a web page, image, video, or other piece of content. Hyperlinks present in resources enable users to easily navigate their browsers to and transformed an academic telecommunication network into a worldwide everyman everyday communication system called internet/www. Commercial enterprise on the Internet The Internet is a global system of interconnected computer networks that use the standard Internet Protocol Suite to serve billions of users worldwide. It is a network of networks that consists of millions of private, public, academic, business, and government networks of local to global scope that are linked by a broad array of electronic and was strictly prohibited until 1991.^[1] Although the Internet became popular worldwide around 1994 when the first internet online shopping started, it took about five years to introduce security protocols and DSL Digital Subscriber Line is a family of technologies that provides digital data transmission over the wires of a local telephone network. DSL originally stood for digital subscriber loop. In telecommunications marketing, the term Digital Subscriber Line is widely understood to mean Asymmetric Digital Subscriber Line (ADSL), the most commonly allowing continual connection to the Internet. By the end of 2000, many European and American business companies offered their services through the World Wide Web The World Wide Web, abbreviated as WWW and commonly known as the Web, is a system of interlinked hypertext documents accessed via the Internet. With a web browser, one can view web pages that may contain text, images, videos, and other multimedia and navigate between them by using hyperlinks. Using concepts from earlier hypertext systems, British. Since then people began to associate a word "ecommerce Electronic commerce, commonly known as e-commerce or eCommerce, or e-business consists of the buying and selling of products or services over electronic systems such as the Internet and other computer networks. The amount of trade conducted electronically has grown extraordinarily with widespread Internet usage. The use of commerce is conducted in" with the ability of purchasing various goods through the Internet using secure protocols and electronic payment services.

Timeline

• 1979: Michael Aldrich Michael Aldrich is an English inventor, innovator and entrepreneur. He developed the concept of information technology as a participative mass communications medium through the use of videotex in 1979/1980. In 1979 he invented online shopping to enable consumers to shop from home. In 1980 he invented the Teleputer, a multi-purpose home invented online shopping Online shopping is the process whereby consumers directly buy goods, services etc. from a seller interactively in real-time without an intermediary service over the Internet. If an intermediary service is present the process is called electronic commerce. An online shop, eshop, e-store, internet shop, webshop, webstore, online store, or virtual
• 1981: Thomson Holidays Thomson Holidays is a UK based travel operator and part of TUI Travel PLC. The company was founded as part of the Thomson Travel Group in 1965 following the acquisition of three package holiday travel agencies and the airline Britannia Airways by Roy Thomson. The Thomson Travel Group was owned by the Thomson Corporation of Canada until it was, UK is first B2B online shopping
• 1982: Minitel The Minitel is a Videotex online service accessible through the telephone lines, and is considered one of the world's most successful pre-World Wide Web online services. It was launched in France in 1982 by the PTT . From its early days, users could make online purchases, make train reservations, check stock prices, search the telephone directory, was introduced nationwide in France France is a founding member state of the European Union and is the largest one by area. France has been a major power for several centuries with strong cultural, economic, military and political influence in Europe and in the world. During the 17th and 18th centuries, France colonised great parts of North America; during the 19th and early 20th by France Telecom France Télécom S.A. is the main telecommunications company in France, the third-largest in Europe and one of the largest in the world. It currently employs about 180,000 people (half outside of France) and has 192.7 million customers worldwide (2010). In 2008 the group had revenue of €53.5 billion. Its head office is in Place d'Alleray in the 1 and used for online ordering.
• 1984: Gateshead Gateshead is a town in Tyne and Wear, England and is the main settlement in the Metropolitan Borough of Gateshead. It lies on the southern bank of the River Tyne opposite Newcastle upon Tyne and together they form the urban core of Tyneside. Gateshead town centre and Newcastle City Centre are joined by seven different bridges across the Tyne, SIS/Tesco is first B2C online shopping and Mrs Snowball, 72, is the first online home shopper
• 1985: Nissan UK sells cars and finance with credit checking to customers online from dealers' lots.
• 1987: Swreg begins to provide software and shareware authors means to sell their products online through an electronic Merchant account.
• 1990: Tim Berners-Lee writes the first web browser, WorldWideWeb, using a NeXT computer.
• 1992: J.H. Snider and Terra Ziporyn publish Future Shop: How New Technologies Will Change the Way We Shop and What We Buy. St. Martin's Press. ISBN 0-312-06359-8.
• 1994: Netscape releases the Navigator browser in October under the code name Mozilla. Pizza Hut offers online ordering on its Web page. The first online bank opens. Attempts to offer flower delivery and magazine subscriptions online. Adult materials also become commercially available, as do cars and bikes. Netscape 1.0 is introduced in late 1994 SSL encryption that made transactions secure.
• 1995: Jeff Bezos launches Amazon.com and the first commercial-free 24 hour, internet-only radio stations, Radio HK and NetRadio start broadcasting. Dell and Cisco begin to aggressively use Internet for commercial transactions. eBay is founded by computer programmer Pierre Omidyar as AuctionWeb.
• 1998: Electronic postal stamps can be purchased and downloaded for printing from the Web.
• 1999: Business.com sold for US $7.5 million to eCompanies, which was purchased in 1997 for US $149,000. The peer-to-peer filesharing software Napster launches. ATG Stores launches to sell decorative items for the home online.
• 2000: The dot-com bust.
• 2002: eBay acquires PayPal for $1.5 billion.^[2] Niche retail companies CSN Stores and NetShops are founded with the concept of selling products through several targeted domains, rather than a central portal.
• 2003: Amazon.com posts first yearly profit.
• 2007: Business.com acquired by R.H. Donnelley for $345 million.^[3]
• 2009: Zappos.com acquired by Amazon.com for $928 million.^[4] Retail Convergence, operator of private sale website RueLaLa.com, acquired by GSI Commerce for $180 million, plus up to $170 million in earn-out payments based on performance through 2012.^[5]
• 2010: US eCommerce and Online Retail sales projected to reach $173 billion, an increase of 7 percent over 2009.^[6]

Business applications

Some common applications related to electronic commerce are the following:

• Email
• Enterprise content management
• Instant messaging
• Newsgroups
• Online shopping and order tracking
• Online banking
• Online office suites
• Domestic and international payment systems
• Shopping cart software
• Teleconferencing
• Electronic tickets

Government regulations

In the United States, some electronic commerce activities are regulated by the Federal Trade Commission (FTC). These activities include the use of commercial e-mails, online advertising and consumer privacy. The CAN-SPAM Act of 2003 establishes national standards for direct marketing over e-mail. The Federal Trade Commission Act regulates all forms of advertising, including online advertising, and states that advertising must be truthful and non-deceptive.^[7] Using its authority under Section 5 of the FTC Act, which prohibits unfair or deceptive practices, the FTC has brought a number of cases to enforce the promises in corporate privacy statements, including promises about the security of consumers’ personal information.^[8] As result, any corporate privacy policy related to e-commerce activity may be subject to enforcement by the FTC.

The Ryan Haight Online Pharmacy Consumer Protection Act of 2008, which came into law in 2008, amends the Controlled Substances Act to address online pharmacies.^[9]

Forms

Contemporary electronic commerce involves everything from ordering "digital" content for immediate online consumption, to ordering conventional goods and services, to "meta" services to facilitate other types of electronic commerce.

On the consumer level, electronic commerce is mostly conducted on the World Wide Web. An individual can go online to purchase anything from books or groceries, to expensive items like real estate. Another example would be online banking, i.e. online bill payments, buying stocks, transferring funds from one account to another, and initiating wire payment to another country. All of these activities can be done with a few strokes of the keyboard.

On the institutional level, big corporations and financial institutions use the internet to exchange financial data to facilitate domestic and international business. Data integrity and security are very hot and pressing issues for electronic commerce today.

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