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This was published in U.S. 1 Newspaper on November 11, 1998.
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E-Commerce: Smart Options
Though security at an ATM machine means keeping your
PIN code secret, someday soon the ATM will recognize your thumbprint
or the look of your eyeball. Security on the Internet now means using
a password, but eventually you will be able to use a "smart
now under development at Bellcore.
So says William J. Barr, executive director of information
at Bellcore in Morristown and founder of the Smart Card Forum. Barr
is in charge of Bellcore’s security research, particularly for smart
cards for a consortium of automobile manufacturers. He will discuss
mission critical applications and the role that both Internet
and smart cards will play at an E-Commerce Forum on Monday, November
16, at 4:45 p.m. at the New Brunswick Hyatt. The conference continues
on Tuesday, November 17. For $1,095 reservations for the two-day
and trade show, call 888-WIREDIN or 732-933-9473.
Barr graduated from Allegheny College in 1970 and has a graduate
from the University of Illinois. He joined Bellcore at the time of
the first AT&T divestiture in 1984; he was chief software architect
responsible for developing Information Networking Architecture and
the OSCA architecture. As founder and now president of the Smart Card
Forum, he co-edited "Smart Cards: Seizing Strategic Business
published by McGraw Hill, and there will be a book-signing opportunity
at the expo from 5:30 to 6 p.m.
"Bill Gates has indicated for two years that smart cards are a
key to creating a secure environment for E-commerce," says Barr,
referring to Microsoft’s just-revealed entry into the smart card
Smart cards can be used to store value (as in the recent failed retail
experiment on New York’s Upper West Side) and/or to authenticate and
identify the user (Barr’s purpose). "We will work with our
an automotive industry action group, to create secure environments
for their E-commerce environment."
On the marketplace now are smart card readers available
on a floppy disk reader or from a port on the back of a computer,
but the favorite method will probably be what Hewlett Packard has
now — keyboards with smart card slots.
"We certainly think we are the leader in providing a secure
environment," says Bellcore’s Barr. "The Internet technology
was not originally designed for secure high performance environment,
but for easy universal access."
"Generally we have to create virtual private internets with
characteristics needed for these critical applications, but moving
Just-in-Time order systems from private line EDI networks will save
automakers a billion dollars a year." Even more important, getting
large companies onto an Internet-based network enables applications
that will have two principal advantages:
lots of big players. The insurance and banking industries have enough
scope and breadth of applications that this becomes a very desirable
thing, and we are working with the entertainment industry," he
"For business to business E-commerce, we will use this technology
to authenticate your trading partners. In the consumer world, we see
increasing applications in home banking and discount stock
says Barr. "Wells Fargo is issuing smart cards to their home
You don’t need smart cards to buy books on the Internet, but to move
money requires a little more security."
Having strong security opens up opportunities to provide
services to network participants who need everything from directory
services and messaging services, to a whole new area — measurement
tools, to measure performance in real time.
Eight banks, for instance, have announced they will offer digital
certificates, electronic identifiers for corporate customers that
can authenticate an individual over an Internet connection.
of using a Personal Identification Number, you would store a thumb
print on the smart card. If you are trying to insure that the person
who placed the order for a million tons of steel, or who issued a
command to move $100 million from Chase to Citibank, you really want
a strong form of identification."
Smart cards would definitely alleviate the problem referred to in
the New Yorker cartoon, which showed two dogs in front of a computer.
One says to the other: "The neat thing about the Internet is that
nobody knows you’re a dog."
— Barbara Fox
Electronic commerce has been on the minds and in the
strategies of business leaders for more than two years now, says
Curtis, development vice president for AT&T Lab’s internet
services laboratory. "Network technology is evolving at a
pace to keep up with the demands of businesses craving reliability,
scalability, and flexibility from their networks. We’ve all watched
as electronic commerce has become the central strategic thrust of
Curtis joins Barr in the E-Commerce Forum that is so loaded with
that six speakers daily are labeled keynoters. On Monday Curtis will
discuss "Networked Commerce: E-Commerce for Today’s
"We will explore the issues facing businesses as they use
technology to improve their reach to their customers and expand their
enterprises," she says.
On Sunday, November 15, before the forum opens, Mike Baker of
the Electronic Commerce Resource Center at the University of Scranton
will teach two half-day workshops on Electronic Data Interchange.
Cost: $175. Scranton’s ERC is one of 16 in the country, and it has
a $2 million contract to evangelize the territory from Maine to
to help small and medium-sized businesses get "electronic commerce
capable" and do business with the federal government.
Monday’s topics include "The Global Politics of Electronic
by James A. R. Johnson of Global Information Infrastructure
Commission. "The Bill is Your Brand: Don’t Let Your Customer Get
Disconnected Paying Your Bill on the Internet," is the topic for
Richard K. Crone of CyberCash Inc. Alex Bangash and
Peterson of Lucent Technologies, plus Lisa Henriott of
Group will address "The Vision of Supply Chain Management,"
along with representatives from i@, SAP, and Oracle.
Victor Nappe will present an Apple Computer case study, and
Irfan Ahmed of Withum Smith & Brown will discuss security
Baker weighs in on Monday with "E-Commerce and Supply Chain
Case Studies: Harley Davidson and the Defense Logistics Agency."
On Tuesday, November 17, "Information Imperative," Richard
L. Moore, global vice president of Lucent Direct, will speak on
"The Information Imperative." Paul Christy, deputy
of the commerce department, STAT-USA. will offer an update on the
administration’s E-commerce initiative.
Also "Securing Electronic Commerce," by Warwick Ford
of Advanced Technology VeriSign Inc.; "Intellectual Property and
E-Commerce: What You Should Know About the Law," by Pamela
L. Banner of Banner, Witkoff Ltd.; "Electronic Commerce and
Its Effects on the Publishing Industry," by Mimi Jett of
Interactive Composition Corporation and Robert S. Sutor,
Interactive Scientific Publishing, IBM.
"Securing a Competitive Advantage with Electronic Payments,"
is the topic for Roger Trout of Sterling Commerce. Steve
Vardy of Snickelways Interactive will discuss "The Buy Button:
Designing for E-Commerce," and Ron Parsons of Strategies
Portfolio Commerce Net will talk about standards in E-Commerce.
Listen up to Robert M. Worsley if you want to
succeed in electronic commerce. He founded the spectacularly
"catalog in the sky" Skymall Inc., the Phoenix, Arizona-based
catalog you find in your seat when you fly almost any airline
http://www.skymall.com). He speaks at the E-Commerce forum
on Monday and Tuesday, November 16 and 17, at the New Brunswick Hyatt.
(See story above).
"I hope to drive home that some very key technology decisions
have been made in our business," says Worsley, "and that in the
next 12 to 24 months, every business will have to ask themselves three
can certainly be no, he says. "You could say I am going to wait
and maybe get involved in a year or two." But if your answer is yes,
systems with our legacy systems?
and bag the legacy systems.
on your feet while you do a "value-waste activity." You will
be spending lots of money over the next 12 to 18 months to integrate
your old systems and become Y2K compliant.
"We spent over $1.5 million converting our entire system to a
webcentric system," says Worsley. He abandoned a clientserver
system with a Sybase Powerbuilder application. "Instead of trying
to make the Internet talk to that one, we said, `Let’s have the
talk to the Internet.’"
This week Skymall operators are taking orders at the call center and
keying right into the Internet. Home shoppers can key into the same
Internet and, as with UPS and FedEx, they will be able to track their
To overcome the Internet’s proverbial slowness, Skymall uses an
for its telemarketers, but the same engine, Microsoft Siteserver 3.0,
runs both the intranet and the Internet. Servers are colocated at
an outside backup vendor, Global Frontier, in Phoenix.
Worsley claims his firm is the first catalog company to do this and
indeed it was the first to contact Microsoft for that purpose. Most
catalog companies still are thinking of the Internet as a potential
focus. Very few have said "Everything we do is webcentric."
Is he making money? Yes, though profits are way down because of
outlays. The business plan is for the catalog companies to sacrifice
their margins in order to snag airline customer information. "They
want those customers’ names to market to them later," says
"and they are willing to let us make the money on this sale. It
is a more cost effective way to get catalog shopping dollars, because
what we pay the airlines (7.5 percent commission on sales) is cheaper
than what the postal service is paid."
To place items in his catalog costs $5,000 per month for a quarter
page for all airlines, and customized catalogs for different national
airlines are available. Pass-along readership is significant. From
20 to 30 customers see each copy, and there is a three to four percent
response rate per copy, even though only one in 800 passengers
places an order.
Though Worsley negotiates exclusive coverage with the airlines,
comes from in-flight magazines and duty-free shopping on international
flights. He hosts an annual bash in Phoenix for the airlines
managers. "We bring in the people we work with and we treat them
really good for three days," says Worsley.
The son of a CPA, Worsley is a Mormon; he was one of seven children,
and he and his wife have six children. After Brigham Young, Class
of ’80, he worked as a CPA for Price Waterhouse until he chanced upon
a lackluster version of an airline catalog. Now he partners with the
company that produced that catalog. "We took a two-cent per
business and turned it into 12 cents."
The company went public in December, 1996 (Nasdaq: SKYM) but the stock
plummeted because it "missed its numbers." He expects the
stock to recover soon; it is trading at 10 times earnings.
Of 250 employees, 200 are telemarketers, and he has weekly breakfasts
with them, 10 at a time. "As I look into the eyes of these people,
mostly women, I see teenage moms with one or two children, never
trying to make something out of their life with these children. I
want to create a situation where they can come and learn the job and
actually work from home and telecommute, to make the call center a
university where they graduate to home. If you have a quiet room,
you can be just as friendly as in a big call center. I have a work
force I would like to assist in their difficult jobs of being parents.
In our church, families are everything."
Studies show that out of every 100 customers who start
a shopping basket online, only two-thirds of them complete the sale.
Research also shows that people want more human contact. Conclusion:
better customer service is needed to turn browsers into buyers.
New Jersey will address this in a seminar on electronic commerce on
Tuesday, November 17, at 8 a.m. at the Hyatt. Cost: $30. Call
Kate Doyle, director of marketing communications of Business
Evolution, 305 College Road, will be talking about "Web Customer
Service: The Missing Link in E-Commerce Equations." She will
the four channels — E-mail, live messaging, chat, and telephone
call back — companies are using to communicate with customers
and also how Business Evolution teamed up with IBM to provide a total
customer solution. Formerly an analyst at Jupiter Communications,
a New York research firm, Doyle has written research reports about
developing business models on the Internet.
"Electronic Commerce — Why Start Now?" will be the topic
covered by Mike Jefferson, IBM’s northeastern E-Commerce sales
manager. The electronic commerce market is predicted to be over $300
billion shortly after the turn of the century.
Future workshops will be on first and third Tuesdays and Thursdays.
Compaq and Trintech will discuss security on Tuesday, December 1,
and Grace Polhemus, director of Technology New Jersey, hopes
to present a holiday-related E-commerce business on Thursday, December
15. In the new year the seminars will get down to the nitty-gritty
of telecommunications technology, all you ever wanted to know (or
more) about such things as ADSL and ATM: Asymmetric Digital Subscriber
Loops and Asynchronous Transfer Mode.
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