Information Technology Reference
In-Depth Information
13
Web Commerce
"The world is poised on the cusp of an economic and cultural shift as dramatic as that
of the Industrial Revolution. (OK, it doesn't take a genius, or even a politician, to figure out
that big changes are afoot when we have a medium that lets someone throw up a virtual
storefront on the Web and instantly gain access to the global market.)"
- Steven Levy, journalist and author, 1997
What has become known as e-commerce - the marketing of goods via the Internet -
began in 1991, when the Net was first opened to commercial use. Not until 1998, however,
did e-commerce really begin to take off after the development of security protocols for
HTTP. By 2000, the lion's share of large, "old-economy" businesses maintained web sites.
At the same time, many "new-economy" "web-native" start-ups arose and - though for the
most part they had yet to show a profit - quickly went public via IPOs fueled by wildly in-
flated expectations. This in turn led to the infamous dot-com collapse of 2000. In the after-
math, the firms with the worst and most unrealistic business plans died; but the ones with a
real future hung on. By the end of 2001, the Business-to-Business (B2B) model of e-com-
merce (at that time the largest slice of the online economy) represented approx. $700 billion
in annual transactions.
The first stars of the retail web included, and include, Amazon and eBay, the latter even-
tually encompassing the popular online payment system PAYPAL. These were quickly fol-
lowed by such firms as Dell, Staples, Office Depot and Hewlett Packard. According to stat-
istics, the most popular categories of products sold in the World Wide Web are music, books,
computers, office supplies and consumer electronics.
Other firms have risen, and sometimes fallen, in providing search and related services
on the Internet.
One of the first search endeavors was Lycos, developed in 1994 by Dr. Michael L.
Mauldin and several other engineers at the Carnegie Mellon University Center for Machine
Translation. (
Lycos
is the Latin name for the wolf spider.) Lycos started with a modest cata-
log of 54,000 web pages, but within a month its crawler software had "spidered" more than
390,000 documents, vastly expanding its index. Within a year Lycos had indexed 1.5 million
documents, and it had accumulated data on over 60 million documents by the end of 1996 -
vastly outpacing other search engines.
During June of 1995, Carnegie Mellon licensed Lycos to a new firm founded by Mauldin
and backed by Carnegie Mellon in collaboration with CMG. The company went public the
following year. In 1998 Lycos acquired Wired Digital, owner of the less-efficient HotBot
search engine, and Mauldin left the firm. From this time on, Lycos developed as a portal net-
