(Electronic-Commerce) Doing business online,
typically via the Web. It is also called "e-business," "e-tailing"
and "I-commerce." Although in most cases e-commerce and
e-business are synonymous, e-commerce implies that goods and services
can be purchased online, whereas e-business might be used as more
of an umbrella term for a total presence on the Web, which would naturally
include the e-commerce (shopping) component.
E-commerce may also refer to electronic data interchange (EDI),
in which one company's computer queries and transmits purchase orders
to another company's computer. See m-commerce, microcommerce and
clicks and mortar.
The First E-Commerce?
In 1886, a telegraph operator was able to obtain a shipment of watches
that was refused by the local jeweler. Using the telegraph, he sold
all the watches to fellow operators and railroad employees. Within
a few months, he made enough money to quit his job and start his own
store. The young man's name was Richard Sears, and his company later
became Sears, Roebuck.
e-commerce, commerce conducted over the Internet, most often via
the World Wide Web. E-commerce can apply to purchases made through
the Web or to business-to-business activities such as inventory
transfers. A customer can order items from a vendor's Web site,
paying with a credit card (the customer enters account information
via the computer) or with a previously established cybercash
account. The transaction information is transmitted (usually by
modem) to a financial institution for payment clearance and to the
vendor for order fulfillment. Personal and account information is
kept confidential through the use of secured transactions
that use encryption technology.
In an effort to further the development of e-commerce, the federal
Electronic Signatures Act (2000) established uniform national standards
for determining the circumstances under which contracts and notifications
in electronic form are legally valid. Legal standards were also
specified regarding the use of an electronic signature (an
electronic sound, symbol, or process, attached to or logically associated
with a contract or other record and executed or adopted by a person
with the intent to sign the record), but the law did not specify
technological standards for implementing the act. The act gave electronic
signatures a legal standing similar to that of paper signatures,
allowing contracts and other agreements, such as those establishing
a loan or brokerage account, to be signed on line.
Once consumers' worries eased about on-line credit card purchases,
e-commerce grew rapidly in the late 1990s. In 1998 on-line retail
(e-tail) sales were $7.2 billion, double the amount
in 1997. On-line retail ordering represented 15% of nonstore sales
(which included catalogs, television sales, and direct sales) in
1998, but this constituted only 1% of total retail revenues that
year. Books are the most popular on-line product orderwith
over half of Web shoppers ordering books (one on-line bookseller,
Amazon.com, which started in 1995, had revenues of $610 million
in 1998)followed by software, audio compact discs, and personal
computers. Other on-line commerce includes trading of stocks, purchases
of airline tickets and groceries, and participation in auctions.
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