CHAPTER ONE

INTRODUCTION

1.1       BACKGROUNDOF THE STUDY

Rarely has a newarea of business been heralded with such enthusiasm as “mobile commerce”, thatis the conduct of business and services over portable, wireless devices. Due tothe astronomical growth of the internet users, maturation of the internettechnologies, realization of the internet’s capabilities, the power ofelectronic commerce, and the promising advancement of wireless communicationtechnologies and devices, mobile commerce has rapidly attained the businessfore – front. M-commerce, although not fully mature, has the potential to makeit more convenient for customers to spend money and purchase, goods andservices. Since wireless devices travel with the consumer, the ability orperhaps temptation to purchase goods and services is always present. This isclearly a technique that can be used to raise revenue. Also the successfulfuture of m-commerce depends on the power of the underlying technology driversand the attractiveness of m-commerce applications.

M-commerce is ane-commerce with wireless access. E- Commerce is the subset of M-commerce. Ifone wants to operate an M-commerce site, one should make arrangement tofacilitate exchange of goods and services via the site. In this regard, buyersor customers could:

• View the goods and services available.
• Purchase any point if goods and servicesusing the shopping cart. Shopping cart is the electronic site like softwarethat will pick anything you buy from the shop to shopping business.
• One should have a means of making paymentfor goods and services selected for purchase. Typically a number of paymentsystems are displayed or provided and the user selects the one of most interestto him or her.

Furthermore, eachpayment system can operate by entirely different 

Independent body andnot necessary by own M-commerce exchange. Adequately arrangements are howevermade between the owner M-commerce exchange, the owners of goods and servicesmarket through the exchange and payment services providers. Ideally, it is theowner of the M-commerce exchange that should negotiate with each of paymentservice providers and (as a separate process) negotiate with goods and servicesprovider. 

1. OPERATIONFEATURES OF M-COMMERCE
2. Anyonewho has goods and services to market contact the M-commerce, to be included inthe online database of the M-commerce exchange.
3. Ifthere is an approval after processing the online form the goods and servicesproviders is requested to provide information about goods and services and loadit to the M-commerce site. Such information include name of each items, itemcode, brief description, unit cost, delivery items, quality discount and anyother information the M-commerce exchange may deem necessary.

It is responsibility of theM-commerce exchange designs to providers a home page featuring a broadclassification of goods and services offering. As the user clicks on a choiceanother page of tittles would come up to reappear the user to see theparticular item of interest.

Beforenegotiating through the available goods and services a user should be requestedto choose whether he or she want to view or purchase the item of interest ashopping business would be deployed were item selected by the user replacealong with the individual cost and cumulative cost. When the user indicatesthat he has finish selection, the payment option are them displayed so the usercan select a mean of payment.

The payment system operates on thetotal cost of the item in the shopping chart and handles all aspect of securityfor such online payment. Depending on the arrangement made by the M-commerceexchange operators each online payment system provider would credit the amountof online exchange operators with the payment made by the buyer less the agreedcommission due to payment system provider.

In the contextof M-commerce, the normal expectation is that the M-commerce exchange can beaccessed via handheld or portable devices from anywhere in the world wherethere is internet connectivity and at any time of the day, all year round. Onemajor advantage of M-commerce exchange concept explained above is that anyonewho decides to use the exchange need not know anything about the internet butcan have goods and services are marketed via the M-commerce exchange web sites.Furthermore, anyone (middle men) without their own goods and services canarrange to sell other people’s goods and services via the site.  This creates job opportunity for many withouttransferring the responsibility of internet on online marketing directly tothem.

E-commerce (electroniccommerce) can be defined as the mutual exchange of perceived or monetary valueby electronic means over open accessible networks. This basically meanscommunication over the internet for some or all of the transaction processes(ARC Group 2000).

M- Commerce(M-commerce) can be defined as any transaction with added value for the user,which is carried out by means of mobile/wireless device or infrastructure (ARCGroup 2000).

M-finance(m-finance) is a subset of M-commerce that offers a range of banking sharedealing and insurance services (ARC group 2000).  With the coming of advanced and sophisticatedservices, mobile communications combined with e-commerce proportions areheightening the attractiveness of M-commerce. The key drivers of this are.

• Ubiquity: The anytime anywhere”advantage of M-commerce (ARC group 2000). Smart phone may fulfit the need forboth real time information and communication, independent of the user’sphysical location (Miiller-veerse, 2000).
• Reachability: Using a mobile terminal, auser can be contacted anywhere anytime. Mobile handsets also provide users theability to restrict their reachability to certain people (Miiller-Veerse,2000).
• Personalization: Handsets are effectivepersonal accessories that are capable to holding data and enabling access toinformation and services tailored to the needs of each individual (ARC group2000).
• Localization: Nothing where the user isand providing information relating to that location adds a unique value tomobile services.
• Convenience: Mobile subscribes have become accustomed totheir devices that store data and are always at hand. More advancedapplications are driven by technology further enabling the mobile subscriber.
• Convergence: Technological applicationscan be decoyed on the move. This is blurring the divide between mobile phonesand PCs. Even increasing sophistication and functionality sustains furtherhandset development.
•  Internet Access: Instant connectivity to theinternet from a mobile device is fast becoming a reality and will take off withthe introduction of GPRD. This suggested that mobile devices will become thepreferred means of accessing information on the internet.

However there are also several factors that may slowor constrain the progress of M-commerce. These inhibitors include thefollowing.

• Security: The public has serious concerns about the security of the internet. This has been s major constraint to consumer e-commerce. This negative perception may be transferred, or potentially magnified to the mobile arena (AGC group 2000).
• Interoperability: Due to the range of handset functionalities and operating systems, there are inherent costs associated with delivering a range of services. This may determine some content providers from making the investment and carrying the overheads associated with such a service.
• Usability: The internet provides rich content via the large screens and multimedia capabilities of PCs. The constraints imposed on the mobile handset might limit its appeal to users (ARC group 2000).