Fundamentals of Mobile Commerce Systems

Fundamentals of Mobile Commerce Systems

Wen-Chen Hu (University of North Dakota, USA)
DOI: 10.4018/978-1-59140-769-0.ch001
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Abstract

With the introduction of the World Wide Web, electronic commerce revolutionized traditional commerce, boosting sales and facilitating exchanges of merchandise and information. The emergence of wireless and mobile networks has now made it possible to extend electronic commerce to a new application and research area: mobile commerce, defined as the exchange or buying and selling of commodities, services, or information on the Internet through the use of mobile handheld devices. In just a few years, mobile commerce has become the hottest new trend in business transactions. The future of mobile commerce is bright.
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Introduction

With the introduction of the World Wide Web, electronic commerce revolutionized traditional commerce, boosting sales and facilitating exchanges of merchandise and information. The emergence of wireless and mobile networks has now made it possible to extend electronic commerce to a new application and research area: mobile commerce, defined as the exchange or buying and selling of commodities, services, or information on the Internet through the use of mobile handheld devices. In just a few years, mobile commerce has become the hottest new trend in business transactions. The future of mobile commerce is bright, as shown by the following predictions:

  • The dramatic growth in demand for smart mobile devices, specifically handhelds, wireless handhelds, and smart cellular phones, through 2007 is shown in Figure 1 (Canalys, 2004a, 2004b, 2004c, 2005a, 2005b, 2005c, 2005d, 2006, & 2008).

    Figure 1.

    Worldwide total smart mobile device shipments in millions from 2003 to 2007

  • The forecasts of smart mobile device shipments are even more encouraging. Smart cellular phone sales will grow at a rate of more than 30% a year for the next five years starting from 2008 according to Bill Hughes (2008) at In-Stat. With this rate, the total shipments of smart mobile devices will pass the one billion mark by 2014 as shown in Figure 2 (Canalys, 2008; Hughes, 2007; Symbian Limited, 2008).

    Figure 2.

    Forecasts of worldwide total smart mobile device shipments in millions

  • Estimated worldwide shipments of the following four types of devices in 2007 were

    • Cellular phones: 1.12 billion (Strategy Analytics, 2008),

    • Laptops: 110 million laptops shipped in 2007, 33.8% growth from 2006 (IDC, Corp., 2008),

    • PCs: 160 million desktop computers shipped in 2007, 4.3% growth from 2006 (IDC, Corp., 2008), and

    • Smartphones: 118 million, up 53% from 2006 (Canalys, 2008).

  • A report by Juniper Research forecast that the global mobile commerce market would become an $88 billion industry by 2009 (Glenbrook Partners, LLC., 2004), although this is still small compared to the $8.5 trillion of business-to-business electronic commerce recorded in 2005 (Gartner, Inc. 2001).

  • In related areas, the market research firm Jupiter Research suggested that ringtone revenues, which have been doubling annually in recent years, will reach $724 million in 2009, while mobile gaming revenues were predicted to reach $430 million the same year. They anticipated that globally m-commerce sales would reach $3.6 billion in 2006 (Brad, 2006).

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