MOBILE COMMERCE

While the impact of mobile computing on our lives will be very significant, a similar impact is already occurring in the way we conduct business. This impact is described as mobile commerce (also known as m-commerce), which is basically any e-commerce or e-business done in a wireless environment, especially via the Internet. Like regular EC applications, m-commerce can be done via the Internet, private communication lines, smart card, or other infrastructures (e.g., see Golding, 2008, en.wikipedia.org/wiki/Mobile_commerce, and Taniar, 2007).
Mobile devices create an opportunity to deliver new services to existing customers and to attract new ones. Varshney and Vetter (2002) classified the application of m-commerce into the following 12 categories:
1. Mobile financial applications (B2C,B2B)
2. Mobile advertising (B2C)
3. Mobile inventory management (B2C,B2B)
4. Proactive service management (B2C,B2B)
5. Product locating and shopping (B2C,B2B)
6. Wireless reengineering (B2C,B2B)
7. Mobile auction or reverse auction (B2C)
8. Mobile entertainment services (B2C)
9. Mobile office (B2C)
10. Mobile distance education (B2C)
11. Wireless date center (B2C,B2B)
12. Mobile music/music-on-demand (B2C)
For details, see mobiforum.org.
Many of these applications, as well as some additional ones, will be discussed in this chapter. For an overview, see Golding (2008)
M-Commerce Value Chain, Revenue Models, and Justification. Like EC, m-commerce may be a complex process involving a number of operations and a number of players (customers, merchants, mobile operators, service providers, and the like). Several types of vendors provide value-added services to m-commerce. These include mobile portals, advertisers, software vendors, content providers, mobile portal, mobile network operators, and more (see en. Wikipedia.org/wiki/mobile_commerce).
The revenue models of m-commerce are the following : access fees, subscription fees, pay-per-use, advertising, transaction fees, hosting, payment clearing, and point-of-traffic.
The capabilities and attributes of mobile computing presented earlier provide for many applications, as shown in Figure 7.1. These attributes are supported by infrastructure. According to Nokia’s advertising, mobility moves from productivity improvement to a strategic part of the enterprise’s IT portfolio.
Justifying M-Commerce. Justifying m-commerce may not be easy due to its intangible benefits. CIO Insight (2007), for example, reports that mobile banking is slow to adopt due to the difficulty to justify it. According to MobileInfo (2008), developing a business case for mobile computing or commerce projects is a serious and complex exercise. It requires analysis of both costs and benefits from undertaking such a project. First of all, there are a number of ways in which you can evaluate IT investment. While some of the methods are qualitative, most financial officers want quantitative analysis. MobileInfo provides a few methods. Others are provided in Chapter 17.
Microsoft developed a special calculator for wireless justification. (See the problem-solving activity at the end of this chapter.)
Impact on Enterprises. Mobile technologies not only provide convenience and efficiency benefits, but can lead in both core competencies and competitive advantage and impact entire strategies and business models. Google activities in the area are good examples.