Jui Chao

Shih-hao Hsieh
Ryan Fedyk
Tom Turner

10/30/2007 1
 Session Objective
 Introduce the concept of e-commerce
 Importance of online growth and worldwide usage
 Taiwan’s e-commerce and unique e-commerce
businesses
 Large market of online gambling and legal issues
 Taiwan’s e-government
 The future of e-commerce

10/30/2007 2
 Electronic Commerce
 E-Commerce consists of the buying and selling of
products or services over electronic systems such as
the internet or other electronic systems.

Source: Wikipedia, http://en.wikipedia.org/wiki/E_commerce

10/30/2007 3
Three Types of e-commerce
 Business-to-Business
- the buying and selling of goods and services between
companies online or by means of other electronic
systems

 Business-to-Consumer

 Customers-to –Customers
- ebay
Source: Pan Western e-business team . http://www.e-future.ca/sask/pdf/b2b_basics.pdf
10/30/2007 4
10/30/2007 5
 Source: Internet World Stats, June 2007
10/30/2007 6
 Source: Internet World Stats, June 2007
10/30/2007 7
 Introduction to Taiwan
 Also Known As: Ilha Formosa, “the beautiful island”.
 Area :35,980 square kilometers
 Population: 22.7 million
 Capital : Taipei City
 Language : Mandarin (official), Taiwanese, and Hakka.
 Religion : Buddhism/Taoism/Christianity/Islam

10/30/2007 8
 Taiwan E-Readiness
Items Penetration Rate
Internet Population 65.97%
Broadband Users 59.93%
Internet Households 73.39%
Broadband Households 64.81%
Mobile Phone 99%
Cable TV 84.60%
Remarks:
1. Total population: 22.73 million (22,730,819)
2. Total households: 7.2 million (7245047)
Source: (2006 January)
1. Taiwan Network Information Center
2. Ministry of Transportation and Communications
3. Ministry of Interior
10/30/2007 9
 US VS. Taiwan

80.0% 69.7%
Penetration Rate

65.97% 64.81%
60.0%
42.0%
US
40.0%
Taiwan
20.0%

0.0%
Internet Population Broadband Households

Sources:PEW pew /internet http://www.pewinternet.org

10/30/2007 10
 E-commerce Status in Taiwan
53.1%

57%

58.9%

USD
Million
*Currency Rate: 33 NTD = 1 USD

Source: Tamkang University

http://www.lib.tku.edu.tw/esource/webtopic/BusinessClass/ImformationMannage/reports/Inf_reportslist.html
10/30/2007 11
 Unique E-Commerce in Taiwan

1. Fortune-Teller
• Name
http://clickfate.com.tw/namefate/namefate251.shtml

• Birthday
http://mindcity.sina.com.tw/east/MC-ziwai/index.shtml

• Feng-Shui (風水)
http://www.e-rent.com.tw/fengshui/

10/30/2007 12
10/30/2007 13
 Fortune-Teller(Cont.)
 Constellation
http://mindcity.sina.com.tw/index.shtml

 The book of Changes(易經)

http://iching.shoppy.cc/

 Horoscope
http://star.pchome.com.tw/

 The Five Elements & The Eight Diagrams

http://www.czu168.idv.tw/

10/30/2007 14
 Unique E-Commerce in Taiwan
2. On-line Worship
 Buddhism
http://areyo.virtualave.net/cgi-bin/light/lightindexd.htm
http://web.thu.edu.tw/chiu/www/bpray/pray.htm

 Taoism
http://www.intellect.com.tw/temple/

 Confucianism
http://www.tccg.gov.tw/sys/SM_theme?page=455019ae
http://www.tccg.gov.tw/confucian/Chinese/a15.htm

10/30/2007 15
 Higher Traffic
 Constellation

 Horoscope

10/30/2007 16
 Lower Traffic
 Feng-Shui

 The book
of Changes

10/30/2007 17
Other Interesting E-commerce
Businesses
 M-commerce

 Second Life

 Online Gambling

10/30/2007 18
Mobile Commerce
 Mobile spending will pass the $500 million mark
in 2008
 Sprint users spend an average of $9.75 on non-
voice services such as downloadable music, ring
tones, TV shows, maps, and directions
 mShopper – use your cell phone to buy any
product by giving product info and customer info
 I-Phone, Blackberry

Source: e-Commerce Times. http://www.ecommercetimes.com/story/59330.html

10/30/2007 19
10/30/2007 20
 2nd Life
 Reportedly over 1 Million “residents”
 Residents can explore, meet other residents, socialize,
participate in individual and group activities, create
and trade items (virtual property) and services
from one another.
 Virtual currency is the Linden Dollar and is
exchangeable for US Dollars

Source: http://many.corante.com/archives/2006/12/26
10/30/2007 21
Get a First Life

10/30/2007 22
 Online Gambling Estimates and
Projections

Source: www.cca-i.com/Primary%20Navigation/Online%20Data%20Store/internet_gambling_data.htm
10/30/2007 23
 Casinos
Online Brick and Mortar

Vs.

 Brick and Mortar have difficulty profiting from poker:

-Opportunity costs by not using space for slot machines.
 Adding another online table doesn’t take up space.
 Low stakes available online attract beginners

Source: http://business.timesonline.co.uk/tol/business/industry_sectors/leisure/article705968.ece
10/30/2007 24
 2006: Unlawful Internet Gambling Act
 Bans American banks and
credit card companies from
completing transactions
with Internet gambling
companies

 Slipped in as rider bill to

unrelated Safe Port Act –
went unread by Senate.

Source: http://www.casinocitytimes.com/news/article.cfm?contentID=161764

10/30/2007 25
 Sen. Bill Frist

Thinks AIDS can be transferred through sweat and tears.

10/30/2007 26
 Casino Lobbyists
 $25 Million spent in donations to
politicians from gambling industry
to ban online betting.
 Online companies responded with
$1.3 Million in lobbying efforts the
first half of 2007 in support of new
legislation.

Source: http://www.casinogamblingweb.com/gambling-news/gambling-law

10/30/2007 27
 Fallout
6 out of top 10 online casinos
stopped accepting US customers

888 stock dropped over 50%

following bill’s passing

PartyGaming(PartyPoker)
dropped 60% in the first 24
hours and 75% overall

Source: http://business.guardian.co.uk/story/0,,1891049,00.html
10/30/2007 28
 Legal Impact
 Is poker a game of chance?
 Poker sites/Third party
providers offshore - not
necessarily subject to US
regulations.
 Will FTC enforce regulations?
 How does law affect
Affiliates(advertising) and
Search Engines?

Source: http://www.gamblingandthelaw.com/columns/2006_act.htm
10/30/2007 29
 The Real Impact
 US players still play(legal or not).
 Companies, not gamblers, feel the effects.
 Companies use Third Party offshore money transfer
accounts to subvert new law.
-Similar to Paypal and Neteller, only offshore.

10/30/2007 30
 2007 Legislation/News
 Skill Game Protection Act - would legalize Internet
poker, bridge, chess, and other games of skill. Has
35 co-sponsors.
 Internet Gambling Tax Act - would legislate
Internet gambling tax collection requirements.
 US goes against a 1994 World Trade Organization
agreement by not allowing offshore gambling
websites to serve US customers.
 WTO recently ruled against the US, saying they
must comply or pay compensation.

Source: http://thomas.loc.gov/cgi-bin/query/z?c110:H.R.2610:
10/30/2007
http://en.wikipedia.org/wiki/Online_poker 31
 Definition of e-Government
e-Government refers to government’s use of
i n f o r m a t i o n t e c h n o l o g y t o e xc h a n ge
information and services with citizens,
businesses, and other arms of government.

Source: wikipedia at http://en.wikipedia.org/wiki/E-government

10/30/2007 32
E-Government Ranking by Countries
Survey Based on the followings
1. Online Information
2. Electronic Services
3. Privacy & Security
4. Disability Access
5. Foreign Language Access
6. Ads, Users Fees, and Premium Fees
7. Public Outreach

10/30/2007 33
Main Reasons for Using E-Government
Ranking

Searching for Information 88.3%

Downloading Forms 65.9%

Ranking
Viewing Real-time Images of
37.2%
Taiwan's Scenic Places

Expressing Opinions or
22.1%
Complaints

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0% 100.0%

10/30/2007 Source: e-Usage at http://www.find.org.tw/eng/news.asp?msgid=290&subjectid=4&pos=0 34

 Current Strategies for e-Government
Increasing
Outsourcing

Advancing
Adopting Web towards Mobile
Service Platform Internet
Services

e-Government

Promoting
Expanding Open
Service Value Standards

10/30/2007 35
 Why Use Outsourcing?
 Use private sector resources to accelerate e-Government
development
 Bring in external expertise

10/30/2007 36
Five Outsourcing Models
 Share-in-saving:
 Self-funded:
 Self-funded-hybrid:
 Operation outsourcing:
 Application-service-provider (ASP):

10/30/2007 37
 Investment in e-Government
From 2003 to 2006…….
Taiwan government has invested US$ 370 million in e-Government Project
Averagely spent US$92.5 million per year on e-Government Project

e-government investment as % of 2006 GDP

0.103%

USD 359,363
Millions

2006 GDP egovernment investment as % of GDP

I USD=33 NTD
Source:
e-government progress in Taiwan –Report to CIA 40th conference
10/30/2007 http://www.zujee.com/data/SiWanLiNian-GDPTaiwan-Annual-GDP1980-2006.htm 38
Centralized e-Government Entry Site

10/30/2007 http://english.www.gov.tw/e-Gov/index.jsp 39
 Administrative Applications
1. Online Vehicle Oversight Service System
 Payment of traffic fines
 Payment of auto fuel taxes
 Reporting of stolen motorcycles
 Reporting of change of motor vehicle ownership or address

10/30/2007 Source: Research, Development and Evaluation Commission http://www.redc.gov.tw 40

 Administrative Applications
2. Pay your income tax online
Research, Development, and Evaluation Commission

The Progress of Online Income Tax Filing

In 2006, 45.31% of 4.92 million taxpayers filed
individual income tax via the Internet, and
15.58% of them used electronic certificates.
50%
45.31%

40%
34.59%
30%
21.06%
20% Percentage of O nline Tax
14.46%
Filing (O TF)
7.06%
10% 2.67%
4.79% Percentage of O TF U sing
0.20% 0.23% 0.33% 0.44% 0.71% 2.00% e-C ertificates
0% 1998 1999 2000 2001 2002 2003 2004 2005 2006

10/30/2007 Source: Research, Development and Evaluation Commission http://www.redc.gov.tw 41

 Administrative Applications
3. Online Security
GCA

MOICA Individual

Government
Agencies

MOEACA
E-Government
Companies
MOICA
Government
Agencies
XCA
Organizations

10/30/2007 42
Source: Research, Development and Evaluation Commission http://www.redc.gov.tw
 Administrative Applications
4. Electronic Exchange of Official Documents
Central Government

Provincial/Municipal
Government

Country/City
Government
 Reduce document transmission time-2 months to 2 minutes
 Raised the level of automation
 100,000 documents being exchanged every day
 Reduction in annual postage expense of around USD 6.3 million
10/30/2007 Source: Research, Development and Evaluation Commission http://www.redc.gov.tw 43
 Administrative Applications
5. Online Payments Services

10/30/2007 Source: Research, Development and Evaluation Commission http://www.redc.gov.tw 44

 Administrative Applications
6. Handicap-free Websites
 Set up web content accessibility guidelines 1.0 in accordance
with the WAI (Web Accessibility Initiative)of W3C
 According to the e-government report of 2006 by Brown
University, Taiwan is continuously leading the other
advanced countries in promoting websites for the disabled

10/30/2007 Source: Research, Development and Evaluation Commission http://www.redc.gov.tw 45

 Administrative Applications
7. Government Procurement System(GPS)
 Provide contractors government e-procurement services

10/30/2007 Source: Research, Development and Evaluation Commission http://www.redc.gov.tw 46

 Administrative Applications
8. e-Housekeeper Services

Source: Research, Development and Evaluation Commission http://www.redc.gov.tw

10/30/2007 47
 The impacts on implementation of
e-government
 Government agencies are becoming more flexible and responsive:
 Government becomes able to act faster
 Government service times are extended
 Government service points become ubiquitous:
 An even broader range of government services is turning to be
available:
 The cost of government services is falling:

10/30/2007 Source: Research, Development and Evaluation Commission http://www.redc.gov.tw 48

 E-Government Service Quality Survey
Conducted by RDEC, 2006
51.10%

100.00% 96.80% 100%

90.00% % visited e-government webs in 1 year Total Respondents

81.30% 79.40%
80.00%
continue using
70.00% 66.30%

60.00% easy to use

50.00%
happy about the
40.00% services
helpful in finding
30.00% information
20.00%

10.00%
0.00%

10/30/2007 Source: Report to ICA 40th Conference September 2006 49

Online Privacy
 Lack of consumer confidence in online privacy is a
major problem hampering the growth of e-commerce

 94.5% of Americans including internet and non-

internet users, are concerned about the privacy of their
personal information when or if they buy online

Source: Malhothra N. Marketing Research: An Applied Orientation 5th ed. p 275

10/30/2007 50
Legal Issues
 To avoid legal issues, a franchise company should
obtain appropriate authorizations and consents from
its franchisees
 Ex: privacy consents, warnings of online risk,
disclaimers
 Provide order summaries
 Contractual terms with an “I Agree” button

Source: Rogers, J., Bennett, C., Grewal, S.“E-commerce for Successful Franchisors.” Franchising
10/30/2007
World. Aug 2007. Vol. 39 Issue 8, p23-24. 51
The Future of Ecommerce
 Large companies that implemented new Internet
technologies saw improvements of 13 percent to 21% in
performance measures
 Small businesses with annual revenues of less than $10
million saw improvements of 40 percent to 50%
 Room for growth - Still less than 7% of retail sales

Source: Colorado Springs Business Journal. Aug 3, 2007.

10/30/2007 52
Upcoming Holiday Sales
 Online retail sales are expected to increase by over
20% this season compared to 2006, surpassing $39
billion

 According to JupiterResearch’s U.S. Retail Holiday Forecast for 2007

Source: Morphy, E. “Report: Cheery Outlook for Holiday E-Shopping Season.” E-Commerce Times
10/30/2007 53
 How to Succeed
 Adapt as the market changes

 Simplicity
 Users do not want to click numerous times

 Add value to the purchasing process

 Free shipping, special online deals

Source: http://www.school-for-champions.com/ecommerce.htm
10/30/2007 54
 How to Succeed
 Ensure privacy and legalities

 Customer Service
 Purchase assistance, follow-up emails, help desk

 Pick a descriptive, memorable name

-The business name is the web address
-ex: books.com, etrade.com, travelocity.com

Source: http://www.school-for-champions.com/ecommerce.htm
10/30/2007 55
Overall Message
 E-commerce can prove effective when conducted
properly. It is an area where businesses need to pay
ongoing attention, as developing trends may provide
them with an edge in the electronic marketplace.

10/30/2007 56
References
 Internet World Stats. http://www.internetworldstats.com Accessed Sep 17,2007
 Nielsen Net Ratings http://www.nielsen-netratings.com Accessed Sep 17,2007
 Burns, E. The ClickZ Network. “Top 10 Search Providers, 2007.” Aug 30, 2007
http://www.clickz.com/3626904 Accessed Sep 17, 2007
 United States Census Bureau. “Quarterly Estimated E-Commerce and Retail Sales.” U.S. Census Bureau
News. Aug 16,2007. http://www.census.gov/mrts/www/data/html/07Q2.html. Accessed Sep 17, 2007.
 Wikipedia, http://en.wikipedia.org/wiki/E_commerce. Accessed October 12,2007.
 “Assessing Organizational Innovation Capability and its Effect on E-commerce Initiatives.” Journal of
Computer Information Systems, Fall2007, Vol. 48 Issue 1, p133-145.
 Bills, Steve. “Citi Launches Two Trials of Mobile P-to-P Technology.” American Banker. Aug 6,2007, Vol. 172
Issue 150, p18-18.
 Rogers, J., Bennett, C., Grewal, S.“E-commerce for Successful Franchisors.” Franchising World. Aug 2007.
Vol. 39 Issue 8, p23-24.
 Malhothra N. .Marketing Research: An Applied Orientation. 5th ed. 2007. p 275.
 Pan Western e-business team . http://www.e-future.ca/sask/pdf/b2b_basics.pdf Accessed Oct 15,2007.
 Dryden, J. “Business to Consumer E-commerce Statistics.” CONSUMERS IN THE ONLINE MARKETPLACE
OECD WORKSHOP ON THE GUIDELINES: ONE YEAR LATER Berlin, 13-14 March 2001.
http://www.oecd.org/dataoecd/34/36/1864439.pdf
 Jupiter Internet Shopping Model
 Morphy, E. “Report: Cheery Outlook for Holiday E-Shopping Season.” E-Commerce Times. Oct 23, 2007.
http://www.ecommercetimes.com/story/59964.html
 Echo H. “Entry to the E-commerce Markets of China and Taiwan: An Application of Content Analysis.”
International, Journal of Management Mar2007, Vol. 24 Issue 1, p82-91.
 Isabel, Y. “Eight Tips for Setting Up A Successful E-commerce Website.” Hudson Valley Business Journal. Oct
2, 2006. Vol 17. Iss 19. p6-25.

10/30/2007 57
References
 Berger, C. “How to Succeed in e-Commerce.” Chartec Magazine. Feb 2002.
http://www.bgatereporter.com/assets/bgate/b88.pdf
 School for Champions http://www.school-for-champions.com/ecommerce.htm Accessed Oct 23,2007
 Regan, K. “Sprint Cuts Ribbon on Mobile Shopping Service.” E-commerce Times. Sep 13, 2007.
http://www.ecommercetimes.com/story/59330.html
 EIU CountryData at shttp://www.nationsonline.org/index.html Accessed Sep 30,2007
 Research , Department and Evaluation Commission http://www.rdec.gov.tw Accessed Sep 30,2007
 PEW pew /internet http://www.pewinternet.org Accessed Sep 30,2007
 Foreseeing Inovative new Digiservices at:http://www.find.org.tw/find/home.aspx
Ecommerce Status in Taiwan at Tamkang
University http://www.lib.tku.edu.tw/esource/webtopic/BusinessClass/ImformationMannage/reports/Inf_
reportslist.html Accessed Sep 30,2007
Directorate General of Budget, Accounting and Statistics, Executive Yuan at
http://eng.dgbas.gov.tw/mp.asp?mp=2
 Fortune teller&online-Wroship Accessed Sep 30,2007
 ClickFate http://clickfate.com.tw/namefate/namefate251.shtml Accessed Sep 30,2007
 Mind City http://mindcity.sina.com.tw/east/MC-ziwai/index.shtml Accessed Sep 30,2007
 E-Rent http://www.e-rent.com.tw/fengshui/ Accessed Sep 30,2007
 Mind City http://mindcity.sina.com.tw/index.shtml Accessed Sep 30,2007
 Asher, A. “Developing a B2B Commerce Implementation Framework: A Study of EDI Implementation for
Procurement.” Information Systems Management, Fall2007, Vol. 24 Issue 4, p373-390.
 Eadington, W. “The Future of Online Gambling in the United States and Elsewhere.” Journal of Public Policy
& Marketing, Fall2004, Vol. 23 Issue 2, p214-219.
10/30/2007 58
References
 Iching Shopping http://iching.shoppy.cc/ Accessed October 7,2007
 PCHome http://star.pchome.com.tw/ Accessed October 7,2007
 Yadav, Manjit S; Prabhu, Jaideep C; Chandy, Rajesh K. “Managing the Future: CEO Attention and Innovation
Outcomes.” Journal of Marketing, Oct 2007, Vol. 71 Issue 4, p84-101.
 CZU http://www.czu168.idv.tw/ Accessed October 7,2007
 Virtual Ave http://areyo.virtualave.net/cgi-bin/light/lightindexd.htm Accessed October 7,2007
 Raymond’s Home http://web.thu.edu.tw/chiu/www/bpray/pray.htm Accessed October 7,2007
 Intellect.com http://www.intellect.com.tw/temple/ Accessed October 7,2007
 http://www.tccg.gov.tw/confucian/Chinese/a15.htm Accessed October 7,2007
 Alexa http://www.alexa.com/ Accessed October 7,2007
 http://secondlife.com/ Accessed October 7,2007
 http://many.corante.com/archives/2006/12/26 Accessed October 7,2007
 CCI-A www.cca-i.com/Primary%20Navigation/Online%20Data%20Store/internet_gambling_data.htm
Accessed October 7,2007
 Business Times Online
http://business.timesonline.co.uk/tol/business/industry_sectors/leisure/article705968.ece Accessed
October 7,2007
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10/30/2007 59
 Q&A

10/30/2007 60