If you are not an engineer, you might be tempted to ignore the whole issue of standards, and with good reason: it is very technical and messy, and any knowledge you gain may become obsolete in a matter of a couple of years. However, if you are really interested in the future of the electronic commerce, you should consider reading this cursory overview. Because standards affect the pace, and sometimes even the direction, of e-commerce's development. A lack of accepted standards may stifle growth in a sector for a few years (as in the case of electronic payments). An emergence of a new standard may create a sector just by itself (as in the case of Java).
Before we start, you need a couple of definitions. A private network is a computer network owned and operated by some company, either for internal purposes (e.g., Anderson School network that allows you to read network drive T: from any computer in the computer labs), or for customers (like the Sprint or MCI network that provides revenue for its owner).
A public network is a computer network that is owned either by the government or by no one in particular, and which is free for anyone to use.
The Internet is not managed by any one organization. In fact, it is the biggest public network in history. It does nothing more than connect about half a million different participating computer networks, most of them private (estimated for the spring of 1998). That's where the name Internet comes from: it is simply an Interconnection of networks.
The idea of the Internet, thus, is very simple: to extend the reach of computer networks from, perhaps, a single building to the whole planet.
Some participating networks are very small, just a few computers. Others are huge, and themselves cover the world. Those are mostly the internal corporate networks of the big multinational corporations. (However, in recent years, there has been a growing tendency to dismantle such big private networks, keeping instead many smaller networks, connected through - you guessed it - the Internet! It turns out to be a lot cheaper. This is the way Ford has gone, for instance.)
As you can guess, networks differ not only in size. You may have heard about Ethernet - it's the type of the network installed at Anderson. There are a few dozen different flavors of Ethernet, depending on the speed you want to get, the number of computers you want to connect, the distance you need to cover, the type of wiring you want to use, etc. Wireless networks are in another category, since they must solve completely different technical problems (e.g., extremely low quality of transmission compared to wired networks). Add to this a few more different types of networks, each with their own subtypes. And remember that some networks are 20 years old, while others are brand new, including experimental versions developed only yesterday.
Now comes the big question: how can a structure that is owned by no one manage the task of connecting half a million very different networks, and 20 million very different computers? And on top of that, survive a growth rate of almost doubling each year for the last 20+ years?
The question has two aspects: technical and commercial. We concentrate on the technical side, where the answer is simple: standards.
What has this to do with electronic commerce? Standards which affect reliability, efficiency, and security of the Internet are critical to the success of electronic commerce, since it rides on top of the Internet. In fact, electronic commerce creates the need for a variety of new standards, since its requirements often exceed the capabilities of the present-day Internet. Since this course takes the Internet infrastructure largely as given, we will only scratch the surface of this important topic.Every single component of the Internet has to satisfy a huge number of very detailed standards. Two computers that "talk" to each other within the Internet may have a 20 years difference in age, a 10,000-fold difference in power, and be otherwise as different as you can imagine (e.g., a PC running Windows vs. a mainframe computer that is operated by a dozen in staff and occupies its own room). But as long as each adheres to the relevant standards, it is very likely that they will work together smoothly.
The next question is, who develops Internet standards? After all, the Internet has no owner! Moreover, software and hardware vendors who actually supply products conforming to those standards have big vested interests in the matter: if a standard is chosen that is close to what a firm is already doing, that firm can get to the market before its competition. The Internet's task is not only to develop technically sound standards, but also to ensure that vendors actually follow them. Just imagine what would happen if Internet standards went the way of 56 Kbps modems, where the two competing technologies are currently incompatible. Then you could see the following message in your browser every second web site you try: "Sorry, But Your Internet Service Provider Is Not Compatible With The Web Site You Are Trying To Connect With."
In 1969, three graduate students (two of them from UCLA) and two researchers were asked to advise on the government's plan to connect several computers in different parts of the US, in what became the prototype of the Internet. These people did the job, and put the results in the form of Requests for Comments, or RFCs. They picked this modest name, rather than simply Standards, because they thought they were only helping some other, higher authority to develop the actual standards. It then turned out there was no higher authority. These RFCs were the first Internet standards. RFCs can be of two types: standards (proposed/draft/approved) and informational. There are now about 2300 RFCs that cover all aspects of the Internet's functioning. Anyone can offer an RFC. However, the majority of RFCs come from The Internet Engineering Task Force (IETF) (http://www.ietf.cnri.reston.va.us/), where over a thousand people divided into 75 working groups meet three times a year to discuss various Internet issues, propose, edit and approve RFCs.
IETF describes itself so: a large open international community of network designers, operators, vendors, and researchers concerned with the evolution of the Internet architecture and the smooth operation of the Internet. Open to any interested individual. In some sense, IETF is the closest one gets to centralized management of the Internet. They cannot do much more than adopt standards and make non-binding suggestions on the global development of the Internet. Yet these activities are a very powerful influence on the future of the Internet.
Overall, the Internet standards-setting process has proven rather successful. There have been a few problems with inefficient or incompatible solutions; however, by and large the standards adopted in the form of RFCs have been followed by vendors.
Optional Task 1: Spend some time browsing the main IETF web site. Go to the RFC repository site (http://www.isi.edu/rfc-editor/rfc.html). Skim RFC 2026 and RFC 2028 that describe the IETF standards setting process. On the basis of these documents and your general business knowledge, think about how the problem of conflicting commercial interests is solved. That is, suppose two very big companies want two incompatible standards; how does IETF manage to actually get a single standard?
With the emergence of the WWW, the community of people who care about the Internet has not just grown, but also changed tremendously. Until the early 1990s this community consisted mostly of network researchers and developers. By now almost half the population in the US has a stake in the Internet. This led to the establishment in 1994 of a new standard-setting body, the World Wide Web Consortium (W3C) (http://www.w3.org/Consortium/), that represents the interests of the new wider community. IETF still does its job on the level of general Internet services, but those standards that focus on WWW-specific issues fall in the realm of the W3C. The Consortium is led by Tim Berners-Lee, the creator of the World Wide Web.
Its members are almost 300 commercial firms, including all the big players on the Internet such as Microsoft, Sun, Netscape, IBM, and a lot of companies that make or hope to make business on the Web. Unlike IETF, the discussions are not open to the public. Member firms pay between $ 5,000 and $ 50,000 per annum to support the Consortium staff. In return they get such benefits as help in "facilitating discussion and arrival at consensus". In effect the Consortium is a vendor-neutral arena to discuss and adopt mutually acceptable product specifications. In addition, W3C provides public services such as announcing the adopted specifications and suggesting prototype implementations.
Usually big firms have a lot to lose from incompatibilities between their products, so they decide it's a lesser evil to talk to competitors than to risk such problems. Unfortunately, this reasoning doesn't always carry through. A recent example is the Netscape vs Microsoft browser battle. As you may have noticed, some pages display better in Netscape, others in Internet Explorer. This is due to the (slightly) different specifications for the HTML language adopted by the two companies. They apparently decided that in this case there is too much at stake in the way of direct competition for them to abide by the W3C standards. Actually, they agreed under the auspices of W3C to a certain standard, but both disregarded it in some ways.
Despite similar problems that have plagued W3C throughout its existence, it managed to keep considerable authority in the development of the Web. However, it by no means can guide the Web on its own. As commercial considerations play an ever bigger role on the Internet, the job of standards-setting bodies becomes extremely difficult. Probably, as in other industries, a lot of small specialized bodies will be formed to develop standards in a very narrow area. Also, in many cases there will not be a standards body as such. For instance, the biggest new standard on the Web in recent years is Java. Its development, licensing, dispute resolution, and all other matters are completely governed by its inventor, Sun Microsystems. Similarly, just as Microsoft and Intel managed to make their products de facto standards of the PC industry, they or someone else eventually may manage to do the same for the Web era.
W3C works together with IETF, often submitting its own RFC proposals. Here's a page (http://www.w3.org/Consortium/Prospectus/FAQ.html#CommerceNet) explaining the relationship between W3C and two other standards bodies, IETF and CommerceNet.
Since this document was written half a year ago, the most important development in this area is certainly the decision by a court here in California to grant a preliminary injunction to Sun in its dispute with Microsoft over Java. This injunction requires Microsoft to make its Java tools compliant with Sun's original definition of the language. If the trial goes the way Sun wants, Microsoft may even be banned from making any extensions whatsoever to Sun's version of Java. Nothing is clearcut, however. While some consumers will benefit from fewer incompatibilities, others may suffer because Microsoft's version of Java actually is better if one limits one's work to Windows. Also, see an interesting and controversial comment on this topic.
Among other areas to watch in the near future are XML as a new standard for web development; a variety of standards related to IP telephony, multimedia (which is now usually handled by plug-ins), and electronic payments.
Optional Task 2: Skim the proposed standard (ftp://ftp.isi.edu/internet-drafts/draft-eastlake-card-map-04.txt) Write what exactly this standard will achieve, if adopted, and who will benefit from it.
Optional Task 3: Go to the Technical Areas section (http://www.w3.org/Areas) of the W3C site. Among the areas the Consortium is working on, think about which are the most critical for fast growth of electronic commerce. Ponder what subjects these areas touch, and why they are important.
Optional Task 4: After further acquainting yourself with the W3C Web site, think about whether there is any inherent difference between the issues that are discussed in W3C and those discussed in IETF. If so, what is this difference, and what are its implications for the standard-setting process?