History & evolution of e-commerce

What does e-commerce mean anyway? E-commerce is the pre-eminent buzzword of the online business revolution. It captures the excitement and focus of this fast emerging market. Moreover, electronic commerce (e-commerce) is the paperless exchange of business information using electronic data interchange (EDI), e-mail, electronic bulletin boards, fax transmissions, and electronic funds transfer. It refers to Internet shopping, online stock and bond transactions, the downloading and selling of “soft merchandise” (software, documents, graphics, music, etc.), and business-to-business transactions.

E-commerce was firstly started to develop in the early 1970s with electronic funds transfer (EFT), electronic data interchange (EDI) and interorganizational system (IOS). EFT is the funds that can be routed electronically from one organization to another. Furthermore, the use of this application was limited to financial institutes, large corporations, and some daring businesses. Then, EDI was evolved to improve the limitation of EPT. EDI is used to electronically transfer routine documents that expanded electronic transfers from financial transactions to other types of transaction processing. While IOS is a system which allows the flow of information to be automated between organizations in order to reach a desired supply-chain management system, which enables the development of competitive organizations.

However, in 1984 EDI was standardized through ASC X12. This guaranteed that companies would be able to complete large amounts of transactions with one another reliably and stable. The next major step occurred in 1992 when the Mosaic web-browser was made available, it was the first ‘point and click’ browser. The Mosaic browser was quickly adapted into a downloadable browser, Netscape. It was providing users a simple browser to surf the Internet and a safe online transaction technology called Secure Sockets Layer. So, Amazon and eBay were popular e-commerce sites in the year 1995. Besides, in July 1995, Jeff Bezos boxed up the first book ever sold on Amazon.com from his Seattle garage. Within its first 30 days of business, the self-proclaimed "Earth's largest bookstore" sold books to online shoppers in all 50 U.S. states and 45 countries. He was the first person to sell his books by using e-commerce. In addition, the digital subscriber line (DSL) was another key moment in the development to of e-commerce in the year 1998. It allowed quicker access and a persistent connection to the Internet.

In the same year, AOL was another emergence in the development of e-commerce. AOL had sales of 1.2 billion over the 10 week Christmas season from online sales. With the development of Red Hat Linux, those who used computers had a choice. Linux gave users another choice in a platform other then Windows that was reliable and open-source. Therefore, Microsoft faced with this competition needed to invest more in many things including electronic commerce. Napster founded in 1999, gained a vital stage even though in the beginning it was only a source through which users shared free music files. Many consumers used the site and were ordering what they wanted from the industry. In the year 2000 Time Warner and AOL merged and which combined a new online company with the well set traditional company. In February 2000 hackers attacked some major players of e-commerce, including Yahoo, eBay and Amazon. These attacks resulted that the need for improved security came to the forefront in the development of electronic commerce.

There was a prediction that the revenues, up until 2006, will grow 40% to 50% annually. Expectations of higher prices as well as larger profits for e-commerce business are also presented. As a result, e-commerce was adapted by almost every major retail company such as Wal-Mart, Borders bookstores, Sears because it was simple and convenient to sell electronically. It can be seen that there will be a large growth in Business-to-Consumer (B2C) e-commerce, Business-to-Business (B2B) and Consumer-to-Consumer (C2C).