BY THOMAS E STAFFORD AND MARK L GILLENSON MOBILE COMMERCE What it lo and what it coulo Be ust a few years ago, many pundits pro- mobile commerce transactions(WAP) has not claimed that m-commerce had arrived, and fulfilled its technological promise [1], so the would shortly provide unprecedented com- most distinctive feature of m-commerce that has mercial functionality to the masses [2, 5]. emerged in many of the larger mobile markets is Cell phone users were expected to be routinely the facilitation of enhanced information net- accessing data online [5], and speedy third-gen- work access. It's not all about WAP; new proto- eration cellular standards would soon solve asso- cols are appearing,but fi ciated bandwidth difficulties [2]. It hasnt qu like the U.s., m-commerce ex worked out that way-it sometimes takes the perceptions have already been molded by WAP. passage of a few years to see how rationality and The main idea of the differences between market economics can skewer technological pre- modalities is that e-commerce can be mobile,but dictions [4]. Now, with hindsight, we can review m-commerce is not always transactional Consid what we once thought m-commerce might be, ering Internet-enabled in-store kiosks, m-com and consider its present and future merce could also be transactional if not always M-commerce is not always, strictly speaking,"phone-in-hand"mobile. This distinction exem- classical e-commerce. The idea of e-commerce is plifies a typical e-commerce practice in Japan: widely understood and there is also a certain iMode phones provide customers with informa- agreement on what -commerce is at a basic tion about shopping choices, but actual product level, since the "m"in the name is self-evident. orders are often entered via in-store self-service Both modalities are computer-assisted and net- computer portals. So, m-commerce provides work-enabled,so what are the differences? good support and promotion for e-commerce While each of the two shares aspects of the transactions to roaming users, even if it's not other, each also possesses unique characteristics always fully functional for every shopping need that tend to define its state and functionality. E-commerce need not always be truly trans- actional, either. Amazon coms CRM system What It Is identifies customers and automatically matches E-commerce is considered to be the them with available product resources. Thi selling of information, products, and services via CRM function is often used just for informa- computer networks [3]. Thus, a primary dis- tion, when buyers browse but don't buy tinction between m-commerce and e-commerce M-commerce also has the potential to be transac- lies in the differences between transactions and tional: consider a cellular telephone handset used access. E-commerce is oriented toward support- to place an eBay bid while traveling.Even so,the ing and realizing transactions. However, the WAP-based promises of mobile e-commerce capa- wireless protocol originally designed to facilitate I bilities have not been completely fulfilled [1, 2] COMMUNICATIONS OF THE ACM December 2003/Vo. 46. No 12 33
J ust a few years ago, many pundits proclaimed that m-commerce had arrived, and would shortly provide unprecedented commercial functionality to the masses [2, 5]. Cell phone users were expected to be routinely accessing data online [5], and speedy third-generation cellular standards would soon solve associated bandwidth difficulties [2]. It hasn’t quite worked out that way—it sometimes takes the passage of a few years to see how rationality and market economics can skewer technological predictions [4]. Now, with hindsight, we can review what we once thought m-commerce might be, and consider its present and future. M-commerce is not always, strictly speaking, classical e-commerce. The idea of e-commerce is widely understood and there is also a certain agreement on what m-commerce is at a basic level, since the “m” in the name is self-evident. Both modalities are computer-assisted and network-enabled, so what are the differences? While each of the two shares aspects of the other, each also possesses unique characteristics that tend to define its state and functionality. What It Is E-commerce is considered to be the buying and selling of information, products, and services via computer networks [3]. Thus, a primary distinction between m-commerce and e-commerce lies in the differences between transactions and access. E-commerce is oriented toward supporting and realizing transactions. However, the wireless protocol originally designed to facilitate mobile commerce transactions (WAP) has not fulfilled its technological promise [1], so the most distinctive feature of m-commerce that has emerged in many of the larger mobile markets is the facilitation of enhanced information network access. It’s not all about WAP; new protocols are appearing, but in significant markets like the U.S., m-commerce expectations and perceptions have already been molded by WAP. The main idea of the differences between modalities is that e-commerce can be mobile, but m-commerce is not always transactional. Considering Internet-enabled in-store kiosks, m-commerce could also be transactional if not always “phone-in-hand” mobile. This distinction exemplifies a typical e-commerce practice in Japan: iMode phones provide customers with information about shopping choices, but actual product orders are often entered via in-store self-service computer portals. So, m-commerce provides good support and promotion for e-commerce transactions to roaming users, even if it’s not always fully functional for every shopping need. E-commerce need not always be truly transactional, either. Amazon.com’s CRM system identifies customers and automatically matches them with available product resources. This CRM function is often used just for information, when buyers browse but don’t buy. M-commerce also has the potential to be transactional: consider a cellular telephone handset used to place an eBay bid while traveling. Even so, the WAP-based promises of mobile e-commerce capabilities have not been completely fulfilled [1, 2], COMMUNICATIONS OF THE ACM December 2003/Vol. 46, No. 12 33 MOBILE COMMERCE: What It Is and What It Could Be BY THOMAS F. STAFFORD AND MARK L. GILLENSON
convergence is likely to reult in wireless and GPS-linked PDA- phones that automatically accommodate our bopping needd with location-dependent vendor offers and promotiond and usually, m-commerce is a support mechanism present shopping experience, in contrast to the that provides mobile information and pror moton current model of generating coupons for the Given the significant differences in display capa- next shopping trip at checkout time bilities between computers and mobile devices, even with recent improvements in phone displayConclusion technology, it's simply difficult to "sell shoes and E-commerce is mostly about buying and sel socks on a cell phone screen [2] ing [3], while m-commerce was expected to be argely data-driven [5]. The true middle What It Could Be ground of the converged mobile future is likely There is a great amount of interest in using cell to include aspects of each business model Phones in m-commerce as digital wallets, although the only thing we can be sure of as it much as mobile devices have been used in evolves in the near future, converged with some countries to activate vending machines. handheld computers and developed in concert Other possibilities include e-services models with networking and database intelligence, is that use intelligent systems to"push"informa- that it will probably bring us as yet unantici tion services linked to database and GPS func- pated capabilities. This situation has generally tionality to business travelers'phones, in order been the case historically with most evolving to provide automatic updates of travel reserva- IT applications. C tions based on location-based data from their mobile devices. Convergence is likely to result REFERENCES inwirelessandGps-lInkEdPda-phoNesthat1.Batista,e."cRappy"wapbridginggap;www.wired.com/news/ automatically accommodate our shopping 2. Feldman, S. Mobile commerce for the masses. IEEE Internet needs with location-dependent vendor offers omputing 4, 6 (une 2000), 74-75 and promotions. We are beginning to see this 3. Kalakota, R, and Whinston, A B. Frontiers of Electronic Com- merce. Addison-Wesley, Reading, MA, 1996. degree of convergence in recent offerings from 4. Rosenblum, B. The ten deadly myths of e-commerce. Business Handspring, Nokia, and Samsung that offer Horion 45,2.(Feb 2002),65-66 PDA and Internet capabilities combined in Dec.2000),148-15 wireless devices Location-based wireless services include the THOMAS F. STAFFORD(tstaffor@memphis. edu)is example of Athens, Georgia's"downtown wire sistant professor of MIS in the Fogelman College of Business nd Economics at the University of Memphis, TN ess networ k"that provides diners and club MARK L. GILLENSON (mgillnsn @memphis.edu) patrons with up-to-the-minute information on professor of MIS in the Fogelman College of Business and happenings and promotional offers in the uni- Economics at the University of Memphis, TN Permission to make digital or hard copies of all or part of this work for personal location-based services deployed in retail stores,where wireless signals could serve the and the full same purpose as a scanner-swiped loyalty card n servers or to redistribute to lists, equires prio specifi permison andlor a at a supermarket checkout; the wireless device could leverage a shopper's profile to guide the I 0200 ACM0002-0782/03/12005.00 34 December 2003/Vol 46, Ne. 12 COMMUNICATIONS OF THE ACM
and usually, m-commerce is a support mechanism that provides mobile information and promotion. Given the significant differences in display capabilities between computers and mobile devices, even with recent improvements in phone display technology, it’s simply difficult to “sell shoes and socks on a cell phone screen [2].” What It Could Be There is a great amount of interest in using cell phones in m-commerce as digital wallets, much as mobile devices have been used in some countries to activate vending machines. Other possibilities include e-services models that use intelligent systems to “push” information services linked to database and GPS functionality to business travelers’ phones, in order to provide automatic updates of travel reservations based on location-based data from their mobile devices. Convergence is likely to result in wireless and GPS-linked PDA-phones that automatically accommodate our shopping needs with location-dependent vendor offers and promotions. We are beginning to see this degree of convergence in recent offerings from Handspring, Nokia, and Samsung that offer PDA and Internet capabilities combined in wireless devices. Location-based wireless services include the example of Athens, Georgia’s “downtown wireless network” that provides diners and club patrons with up-to-the-minute information on happenings and promotional offers in the university city’s entertainment district. Imagine location-based services deployed in retail stores, where wireless signals could serve the same purpose as a scanner-swiped loyalty card at a supermarket checkout; the wireless device could leverage a shopper’s profile to guide the present shopping experience, in contrast to the current model of generating coupons for the next shopping trip at checkout time. Conclusion E-commerce is mostly about buying and selling [3], while m-commerce was expected to be largely data-driven [5]. The true middle ground of the converged mobile future is likely to include aspects of each business model, although the only thing we can be sure of as it evolves in the near future, converged with handheld computers and developed in concert with networking and database intelligence, is that it will probably bring us as yet unanticipated capabilities. This situation has generally been the case historically with most evolving IT applications. References 1. Batista, E. “Crappy” WAP bridging gap; www.wired.com/news/ wireless/0,1382,51516,00.html. 2. Feldman, S. Mobile commerce for the masses. IEEE Internet Computing 4, 6 (June 2000), 74–75. 3. Kalakota, R., and Whinston, A.B. Frontiers of Electronic Commerce. Addison-Wesley, Reading, MA, 1996. 4. Rosenblum, B. The ten deadly myths of e-commerce. Business Horizons 45, 2 (Feb. 2002), 61–66. 5. Senn, J.A. The emergence of m-commerce. Computer 33, 12 (Dec. 2000), 148–151. Thomas F. Stafford (tstaffor@memphis.edu) is an assistant professor of MIS in the Fogelman College of Business and Economics at the University of Memphis, TN. Mark L. Gillenson (mgillnsn@memphis.edu) is a professor of MIS in the Fogelman College of Business and Economics at the University of Memphis, TN. Permission to make digital or hard copies of all or part of this work for personal or classroom use is granted without fee provided that copies are not made or distributed for profit or commercial advantage and that copies bear this notice and the full citation on the first page. To copy otherwise, to republish, to post on servers or to redistribute to lists, requires prior specific permission and/or a fee. © 2003 ACM 0002-0782/03/1200 $5.00 c 34 December 2003/Vol. 46, No. 12 COMMUNICATIONS OF THE ACM CONVERGENCE is likely to result in wireless and GPS-linked PDA-phones that automatically accommodate our shopping needs with location-dependent vendor offers and promotions