E-Business, in full Electronic Business, refers to maintaining relationships and conducting business transactions — including selling information, services, and goods — by means of computer telecommunications networks.
Although in everyday language E-Business often refers only to the trading of goods and services over the Internet, it actually covers broader economic activity. It consists of business-to-consumer (B2C) and business-to-business (B2B) commerce, as well as internal organizational transactions that support these activities.
Origins of E-Business
E-Business began as a standard for exchanging business documents — such as orders or invoices — between suppliers and their business customers. This origin can be traced back to the 1948–49 Berlin blockade and airlift, where goods were ordered primarily via telex.
Over the decades, various industries expanded on this system, and in 1975 the first general standard was published. This led to the creation of computer-to-computer electronic data interchange (EDI), a flexible system capable of handling most simple electronic business transactions.
Shift to the Internet
With the wide adoption of the Internet and the introduction of the World Wide Web in 1991 (and the first browser in 1993), most E-Business activities moved online.
Later, the global spread of smartphones and the availability of fast broadband Internet shifted much of E-Business to mobile devices, including tablets, laptops, and wearables such as smartwatches.
Everyday Impact
E-Business has transformed daily life and the way both businesses and governments operate. Commerce now takes place in electronic marketplaces (marketspaces) and Internet-based supply chains.
Examples include:
- Consumer-oriented marketplaces: large e-malls (Amazon), auction platforms (eBay), multichannel retailers (L.L. Bean), and millions of smaller e-retailers.
- B2B marketplaces: massive platforms like Alibaba.
- Sharing economy: services like Airbnb for rentals and Uber for transportation.
- On-demand platforms: offering immediate access to services such as cloud computing, storage, and professional advice.
New Business Models and Technologies
- Mass customization of goods (e.g., clothing, vehicles) became common.
- Cryptocurrencies like Bitcoin emerged as payment options.
- Semi-permanent supply chains allow companies like Dell to work closely with suppliers who handle most production tasks.
Social Commerce and Communities
Social networking sites (e.g., Facebook) have become hubs for social commerce, driven by user opinions, reviews, and electronic word-of-mouth.
Online communities enable people to:
- Share knowledge
- Build lasting relationships
- Collaboratively create value, such as producing open-source software or maintaining online encyclopedias.
Web & Mobile Advertising
When it comes to advertising online, it can take many forms — from those big banner-style display ads you see on websites to those little keyword-based ads that pop up when you search on Google.
Mobile advertising, in particular, has exploded over the past decade. With nearly everyone carrying a smartphone, it’s become easier than ever for businesses to:
- Show ads tailored to someone’s personal preferences and browsing habits
- Send promotions based on where a person is physically located
- Turn advertising itself into a source of revenue, which is exactly how companies like search engines make a big chunk of their money
Innovations That Pushed E-Business Forward
E-Business didn’t just grow by itself — it was boosted by a few clever developments along the way. Things like:
- Online directories and search engines that make finding information quick and easy
- Automated bots that can search for products or services without a human lifting a finger
- Recommendation tools that seem to “read your mind” and suggest things you might like
- Digital ID services that prove who you are when you’re interacting online
Together, these tools make it possible to shop, bank, book tickets, invest, learn, and even watch a movie without leaving your couch.
The Security Side of E-Business
Behind the scenes, most businesses rely on secure digital spaces. Some keep information flowing internally through intranets, while others work with trusted partners using extranets that allow encrypted communication over the Internet.
Security isn’t just a nice-to-have — it’s essential. It’s all about making sure that:
- The right people are who they say they are
- Only authorized users get access to certain information
- Messages and transactions stay private and unchanged in transit
To make this happen, many companies turn to public key infrastructure (PKI) — a system that issues electronic certificates, handles encryption keys, and sets up the protocols needed for secure communication.
Even so, no system is perfect. Time and again, major data breaches have shown that security is a moving target — and when it’s neglected, the consequences can be massive.
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