Analysis of E-commerce innovation and impact: a hypercube model

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Abstract

Electronic commerce (E-commerce) innovating applications have posed novel, technical, organizational and commercial challenges. This study uses a hypercube model to investigate these innovative changes and focuses on their impacts on E-commerce stakeholders: providers, E-commerce companies, customers, and complementors. The results indicate that mobile commerce (M-commerce) differs substantially from Web-based commerce in some technological components, yet both share common business model. However, from Web-based to M-commerce, innovation is architectural for customers and E-commerce companies, but a radical change for complementors. From M-commerce to U-commerce, innovation is modular to customers, architectural to complementors and radical to E-commerce companies and providers. Thereafter, the critical impacts of E-commerce innovations on the stakeholders are identified.

Introduction

Rapid developments in information and telecommunication technology have substantially changed the landscape of organizational computing. Electronic commerce (E-commerce), including Web-based commerce, mobile commerce (M-commerce) and ubiquitous commerce (U-commerce), is based not only on developments pertaining to the Internet compound, but also on prior technological and organizational innovations arising from the combination of telecommunications and organizational computing [33]. In the past decade, E-commerce via the Internet (i.e., Web-based commerce) has substantially affected the business world and will continue to be important.

Today, the world of business is witnessing profound changes under the influence of wireless technology. The opportunity for M-commerce has opened. M-commerce broadly refers to any transactions with monetary value that is conducted over a wireless telecommunication network [5]. Market researchers have predicted that, by the end of the year 2005, nearly 500 million wireless device users will exist, generating more than $200 billion in revenue [13].

Predictably, with the progress in telecommunication technology, the continuous growth of wireless bandwidth and connectivity will drive the frontier of U-commerce forward. U-commerce is a dynamic convergence of the physical and the digital, the interface of traditional commerce with ubiquitous computing technologies to support personalized and uninterrupted communications and transactions [10], [15], [16], [23]. It strives to integrate traditional computing into everyday activities in a seamless manner. The age of U-commerce will state in the next 5–10 years [15]. Thus E-commerce innovations will have significant impact on the capabilities and assets of existing stakeholders and result in many novel change management issues.

Understanding the nature of innovation is a crucial first step in managing the changes associated with any innovation [12]. The objectives of this paper are therefore to: (1) elucidate the major changes among E-commerce innovations using the hypercube model, (2) explore the impact of E-commerce innovations on the stakeholders involved in transition from today’s systems to M-commerce and U-commerce, and (3) identify a set of propositions for guiding future research.

Section snippets

The E-commerce hypercube innovation model

An innovation, such as a system or a product, can be seen as a historical change in the way a “thing is done” and as “creative destruction” [25]. We adopted a hypercube model, following Afuah and Bahram [2], to examine E-commerce innovation and its impact on E-commerce stakeholders. The hypercube model includes three dimensions: core components, business models, and stakeholders, as shown in Fig. 1. Core components are distinct portions of the product that embody the core design concept and

Technological infrastructure

Web-based commerce technologies are embodied in the Internet infrastructure, which is supported by the standard Transformation Control Protocol/Internet Protocol (TCP/IP) and global wired networking infrastructure. The salient features of the Internet include: reliance on an open and packet switching protocol, data-oriented transmission, the absence of centralized control and ease in linking additional networks via routers.

The World Wide Web (WWW) has served the Internet as a medium for the

The impact of the E-commerce innovation on the stakeholders

As companies find more and more of their business being conducted over the web, their competitive advantage may rest on collaborative relationships such as a value network with their co-opetitors [29]. An E-commerce company’s co-opetitors include the stakeholders (providers, customers and complementors) with whom it must collaborate and compete. Co-opetitors must engage in “co-opetition” as they collaborate via alliances and compete via coalitions in value network. They provide a critical

Conclusions

The E-commerce innovation analyzed via the hypercube innovation model provides a better understanding of how innovation will affect the capabilities of E-commerce stakeholders (providers, E-commerce companies, customers, and complementors). M-commerce differs substantially from Web-based commerce in certain technological components. However, both share a common business model for providers. U-commerce is however, a radical change for providers. The impact of innovation from Web-based commerce

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