BizAims

2006 Canadian online shoppers VS. U.S. online shoppers.

According to a J.C. Williams Group www.jcwg.com study (discussed by reporter Dana Flavelle in the Toronto Star June 15th, 2006).

Online sales account for

• 2% of all retail sales in Canada
• 6% in the United States

Meaning a greater proportion of Americans shop online than Canadians.

By 2006, statistical information about the growth of the Internet and E-commerce has become a very large concern and there are thousands of sources. For the purpose of E-commerce class, we simply want some basic information covering.

Government information at the national level can be a helpful source of statistics from which people may draw conclusions about the circumstances of e-commerce in a country. The Canadian government has a particularly efficient agency named "Statistics Canada" which tracks a variety of business and economic indicators, including information on e-commers.

By 2006, statistical information about the growth of the Internet and E-commerce has become a very large concern and there are thousands of sources.

Dining with the cryptographer

For Chaum, the politics and the technology reinforce each other. He believes that as far as privacy is concerned, society stands at a crossroads. Proceeding in our current direction, we will arrive at a place where Orwell's worst prophecies are fulfilled. He delineated the problem in an essay called "Numbers Can Be a Better Form of Cash Than Paper." "We are fast approaching a moment of crucial and perhaps irreversible decision, not merely between two kinds of technological systems, but between two kinds of society," says the article, published in 1991. "Current developments in applying technology are rendering hollow both the remaining safeguards on privacy and the right to access and correct personal data. If these developments continue, their enormous surveillance potential will leave individuals' lives vulnerable to an unprecedented concentration of scrutiny and authority."

Digital money man

In the world of digital cash, David Chaum is the marked penny that keeps reappearing. His ideas circulate as freely as cash itself. He is indisputably the pioneer of the field, the one who shifted it from the ether of science fiction to the solid footing of mathematical truth. But the man himself is the center of controversy. All of those involved in the daring attempt to shred dollar bills into arcane mathematical formulae know of Chaum, and almost all admire his work. But when they talk of their dealings with him, they immediately go off the record. It turns out that at one point they considered licensing Chaum's patents or at least recruiting Chaum's participation in their projects. These processes seemed to end in fruitless standoffs, sometimes acrimonious ones. Then, inevitably, more negotiations. Chaum cannot be ignored even by those who disparage him off the record.

Clouds gather over Amsterdam as I ride into the city center after a day at the headquarters of DigiCash, a company whose mission is to change the world through the introduction of anonymous digital money technology. I have been inundated with talk of smart cards and automated toll takers and tamper-proof observer chips and virtual coinage for anonymous network ftps. I have made photocopies using a digital wallet and would have bought a soda from a DigiCash vending machine, but it was out of order.

My fellow passenger and tour guide is David Chaum, the bearded and ponytailed founder of DigiCash, and the inventor of cryptographic protocols that could catapult our currency system into the 21st century. They may, in the process, shatter the Orwellian predictions of a Big Brother dystopia, replacing them with a world in which the ease of electronic transactions is combined with the elegant anonymity of paying in cash.

Since e-money is just a bunch of bits, a piece of e-money is very easy to duplicate. Since the copy is indistinguishable from the original you might think that counterfeiting would be impossible to detect. A trivial e-money system would allow to copy of a piece of e-money and spend both copies. It is possible to become the millionaire in a matter of a few minutes. Obviously, real e-money systems must be able to prevent or detect double spending. Online e-money systems prevent double spending by requiring merchants to contact the bank's computer with every sale. The bank computer maintains a database of all the spent pieces of e-money and can easily indicate to the merchant if a given piece of e-money is still spendable. If the bank computer says the e-money has already been spent, the merchant refuses the sale. This is very similar to the way merchants currently verify credit cards at the point of sale.

This method is very efficient due to the fact that electronic transactions are less costly because there's no need to transport, handle or reconcile paper checks. Costs are reduced not only for businesses but for financial institutions that deal with processing the transaction as well. As for the consumer than there should be mentioned such advantages as the speed of payment and less worries about the bill paid "too early".

Debit cards represent a quite useful mean of electronic payment due to the fact that they permit a swift transfer of funds between buyer and seller. There is no need for the seller to be concerned about a bounced check. The debit might be of more convenience to the buyer than writing a check, and it is also more secure than carrying cash. There are consumers who also vote for debit. This is due to the fact that they consider the limitation by the amount of money, stored on their account, as a good means of managing their spending.

This technology received great support from the government. Currently a lot of state and federal benefits, including Social Security and food stamps, are transferred electronically. The distribution of benefits via electronic means is advantageous for the government and for the recipients. Electronic transfer is much cheaper that paper checks and in addition it also reduces fraud.

About three decade ago there were people who predicted the end of a society with cash. This was due to the appearance of electronic money as a new way of payment. However, people were somewhat reluctant regarding the use of e-money and leaving out the currency and checks.

As time goes by more people change their minds and vote for electronic means of payment, though currency and check are still highly used in society. Today currency is mainly used for making small purchases. According to statistics, checks are used for 10% of transactions performed each year. As for the transactions performed electronically, these are continuously increasing with a dramatic speed. All in all electronic payments represent 90% of the dollar value of transactions.

The significant growth was possible due to electronic payment networks. These transfer funds in and out of accounts with the help of electronic messages. There's a great variety of e-payment systems, starting with ATMs and to the Internet bill payments.