E-Commerce Security

E-Commerce Security

COEN 351

Thomas Schwarz, S.J.

Amazon.com

1994: Bezos founds amazon.com

1995: amazon opens for business; competes onprize, selection, convenience, service.Business model promises low overhead.

1999: Bezos is man of the year for Timemagazine.

2000: 2.7 B$ revenue, 1.4 B$ loss starts searchfor profitability.

2002: First ever profits. 4B$ revenue

E-Commerce

E-commerce

Use of the internet to transact business.

E-commerce I

1995 – 2000: explosive growth,extraordinary innovation

March 2000: dot.bust

2001 – today: solid growth, less hype

E-Commerce I

Disintermediation

Friction-free commerce

Information equally distributed

Transaction costs are low

Prices are dynamically adjusted

Goal of “First Mover”

Successful first mover becomes new intermediary

$120 B$ capitalization for 12,450 dot start-ups

10% survival rate, very few profitable

E-Commerce II

Earning and profits emphasis

Traditional Financing

Stronger regulation and governance

Strengthening intermediaries

Imperfect markets

Mixed “click and brick” strategies

E-Commerce Business Model

Value proposition (Why buy from you?)

Revenue model (How will you make money?)

Market opportunity

Competitive environment

Market strategy

Organizational development

Management team

E-Commerce Business Model

Revenue Model

Advertising revenue model

Subscription revenue model

Transaction fee revenue model

Sales revenue model

Affiliate revenue model

E-Commerce Business ModelB2C

Portals

E-tailers

Competitive market because barrier to entry is low

Content provider

Transaction broker

Market creator

Brings buyers and sellers together

Service Provider

Community Provider

E-Commerce Business ModelB2B

E-Distributor (Sales of goods)

E-Procurement (Fees, supply chainmanagement, fulfillment services)

Exchanges (Fees, commissions ontransactions)

Industry Consortia

Emerging E-CommerceBusiness Models

C2C: eBay,

P2P: Kazaa

M-commerce (mobile commerce), useswireless

E-commerce enablers

Internet Fraud Complaints2003

Auction fraud 46.1%

Non-delivery 31.3%

Credit / Debit card fraud 11.6%

Investment fraud 1.5%

Business fraud 1.3%

Confidence fraud 1.1%

Identity theft 1.0%

Check fraud 0.5%

Nigerian letter fraud 0.4%

Communications fraud 0.1%

E-Commerce Security

Integrity

Non-repudiation

Authenticity

Confidentiality

Privacy

Availability

E-Commerce Security

Threats:

Malicious Code

Hacking, Cybervandalism

Credit Card Fraud

Spoofing

DoS, DDoS

Sniffing

Insider Jobs