Mobile Commerce in Perspective

MOBILE COMMERCE

1) As we discussed briefly in Chapter 1, mobile commerce (m-commerce,) relies on the use of wireless devices, such as personal digital assistants, cell phones, and smart phones, to place orders and conduct business. Handset manufacturers such as Ericsson, Motorola, Nokia, and Qualcomm are working with communications carriers such as AT&T Wireless and Sprint to develop such wireless devices and their related technology.

Mobile Commerce in Perspective

2) Jeff Bezos, CEO of Amazon.com, has called m-commerce “the most fantastic thing that a time-starved world has ever seen. Adam Zawel, an analyst at high-powered consulting firm The Yankee Group, predicts that wireless purchases will reach $4.5 billion annually by 2006. Despite this optimism, m-commerce purchases have not yet taken off.

3) To ensure user-friendliness, the interface between the wireless device and its user must improve to the point that it is nearly as easy to purchase an item on a wireless device as it is to purchase it on a PC. In addition, network speed must improve so that users do not become frustrated. Security is also a major concern, with two major issues: the security of the transmission itself and the trust that the transaction is being made with the intended party. Encryption can be employed to provide secure transmission. Digital certificates, discussed later in this chapter, can be employed to ensure that transactions are made between the intended parties.

4) In geographic areas with nearly ubiquitous network coverage, such as major metropolitan areas, adoption of m-commerce is much more likely than in areas with spotty service. Similarly, regions with newer, high-speed wireless networks have a faster response time, making mobile transactions faster and more convenient. As a result, the acceptance of m-commerce is currently geographically dependent.

The market for m-commerce in North America is expected to mature much later than in Western Europe and Japan for several reasons. In North America, responsibility for network infrastructure is fragmented among many providers, consumer payments are usually done by credit card, and most Americans are unfamiliar with mobile data services. In most Western European countries, communicating via wireless devices is common, and consumers are much more willing to use m-commerce. Japanese consumers are generally enthusiastic about new technology and are much more likely to use mobile technologies for making purchases.