E-Commerce and Security

I was searching Amazon.com, when I finally found the CDs I’ve been looking for. Since I couldn’t find them in any local store, I had to buy them online using my credit-card. I was hesitant about the idea, but at the same time, I really wanted those CDs. I was hesitant because I’ve heard a lot of stories where hackers waited and somehow managed to take credit-card numbers. Anyway, a while after I finally paid, I checked my bank account to make sure nothing was missing, and it turned out ok. It was completely safe. The Internet is changing the way people shop. The frequency of online shopping is increasing rapidly. However, consumers and retailers are always concerned about the security of E-commerce. Both know that privacy and security can be breached. E-Commerce has developed widely at the end of the 20th century, but one should be aware that it might not always be secure.

E-commerce can be defined as “any form of business transaction or information exchange executed using information and communication technologies”. It includes “electronic trading of goods and services”. It can also be defined as “conducting business over a network that is in some logical way connected to the Internet”. Nowadays, E-commerce is a factor in competition between existing retailers. The use of E-commerce is a great advantage, and can provide a new marketing and servicing channel, decrease the cost of goods, and cut out intermediaries in the supply chain.

E-commerce has many advantages for the consumer. A person can shop from his house, avoiding the troubles of going to the shop, parking, and waiting in queue… Moreover, people can shop at anytime, anywhere in the world. In addition to that, home delivery brings goods to the door of the buyer’s home. Moreover, the goods available on the Internet are up-to-date, and sometimes cheaper than goods available in a conventional store.

On the other hand, there are also many disadvantages of E-commerce. Although the Internet is changing the way people shop, consumers and retailers worry about the security of financial transactions. Moreover, a delay in delivering the goods may cause additional expenses. Another thing is that the goods shown on the Internet are intangible, so a person buying a T-shirt online can’t actually see the T-shirt or try it on. In addition to that, the return of faulty goods takes time and costs a lot of money.

Security and privacy of E-commerce is the main concern of online shoppers and retailers. Many Internet users fear to give their credit-card number online. This means that it should be a company’s job to defend itself against intrusions to avoid security breaches. Hackers may intercept messages, misuse the information or even modify the content of the message. Therefore, most online retailers and important companies are rebuilding consumer’s trust by protecting consumer’s privacy. Companies are now looking forward to enhance their security budget, since the cost associated with the loss of revenue is much higher than the cost of preventing breaches. Therefore, increasing security on online transactions benefits both the consumer and the retailer. As a result, E-commerce security involves a lot of things like authentication, encryption, virus scanning, firewalls… These things help build up consumer’s trust. The most important security measures are authentication and encryption. The sender of a credit-card number must be identified precisely. Furthermore, the retailer must approve whether the online shopper is actually using the credit-card number or not. This will decrease the possibility of stealing credit-card numbers from the Internet. Moreover, authenticating the identity of a party decreases the likelihood that another party can interfere. According to the article “Online Shopping and Security”, “there have been important innovations that attempt to address the issue of security of online transactions”. One such innovations is known as the “SET (secure electronic transaction) protocol”. It enhances the security protection of credit card numbers and other personal information that is sent via Internet. SET uses encryption technologies that code a message in such a way that make it impossible for hackers to decode. This process is done by encrypting the information that is being sent, and then decrypting them when they are received. Hackers view the information sent as anonymous since they do not have the key to decrypt the message.

As mentioned in “If All the World’s a Computer”, “privacy is one thing that the next generation of computing will abolish”. It is said that as new technologies develop, concerns about security of Internet transactions diminish. However, this statement is not really adequate, because one should keep in mind that for every step taken to improve security, there is an opposing step taken by hackers to breach security. This is a never-ending war, just like the case between good and evil, so just to stay on the safe side, one should always be careful which sites to trust and which to avoid.

Sources:

• “Legal Issues For E-commerce” by Steven Strauss
• http://www.bizland.com
• Nua Internet Surveys: http://www.nua.ie/surveys/
• “Sultans of E-commerce Security” E-commerce Times.  April 5, 2002. by Lou Hirsh
• “If All the World’s a Computer…” Newsweek. January 1, 2000. by Peter McGrath
• E-Commerce: Strategy, Technology and Applications by David Whitely