CS99I Meeting 12 Notes: Information concepts

Started by Gio Wiederhold, 26 Jan 2000, updated 10, 25 Feb.

Topics Covered briefly

Concepts for Effectiveness

DATA
KNOWLEDGE
INFORMATION
WISDOM?

Who provides what?
Who uses what?
Who benefits from what?

'The Internet is the Database' [Scott McNealy, SUN]

Interaction of Data and Knowledge

1. Things you never knew - search
2. Stuff you have forgotten - links
3. Combination of elements

Decision-making
At home
In business
In government (see Meeting 3 Notes: Institutions and People)

Actionable information leads to making of a decision. That decision can be extrinsic to the web -- you know know how to continue the paper you are writing -- the web business gians nothing more from you. That decision can be intrinsic to the web -- you click further and eventually make a purchase or other transaction. Now the web business can gain monetary value from you.

Consolidators and Mediators

Combining information is the most powerful approach on the web. There is much information that becomes valuabe in concert with other information, and can lead to action

1. The best price
2. A suitable case for your laptop computer
3. A convenient train to the airporta dn your flight
4. A trucker that comes from the factory to your house

A Business Classification of Services

Customer-oriented businesses (C2B) what service do they provide

1. Content players: live from ads, sponsorship. Are threatened by low switching costs {Yahoo, Marketwatch , }. Customer loyalty is based on service quality and relevance.
2. Transaction players : Transaction revenue, but commodity business: {Amazon, ETrade, Citibank, BankOne}. Customer loyalty is based on price?

Content players can go into partnership with transaction-oriented B2C, B2B firms, lessening the direct impact of potential bias -- equivqlent to having ads in the newspaper. They could also acquire some, or integrate them as new services. Example NY Times links to Barnes and Noble. See BuyNow.com. [Bill Burnham, general partner, Softbank Capital Partners, LLC]

Since Information has value, businesses may want to protect it. However, proprietary control is being destroyed by technology, by consolidators. Examples are {Yodlee.com MaxMiles.com, VerticalOne.com} Companies are trying to fight this trend, for instance FirstUnion is trying to stop Paytrust from getting to its customer credit-worthiness records. The suit cites nominally privacy, but really addresses proprietary concers. Is a losing battle [Bill Burnham].

Knowledge (aggregated) is more valuable.

Privacy issues in aggregation

Aggregating companies, as MaxMiles can be granted power-of-attorney for access. Microsoft Passport "You can rest assured that your information is safe at Microsoft".

How will the market split up

Large providers, Virtual Interactive Networks (VINs) may split up most of the e-commerce pie, like 20th century TV splitting up the spectrum.

Unclear is the trend of broad-based (YaHoo, AltaVista) versus focused, In-Context (iVillage, DiabetesWebSite.org) access points. InContext commerce has many benefits, in that there is less irelevant material. In-context commerce makes it possible to monetize a customer base with other commerce and content. If a domain aggregator gets 5 million loyal affinity customers, it is powerful. (similar to a specialized magazine).

To survive, sites need Barriers to Exit, as deals, community spirit, etc. Now AOL earns 70% of income from subscriptions. But when access can be free, what happens? (Can AOL become just an infrastructure provider?)

A simple customer incentive is free Internet access. But what comes then? See All-Advantage, since May 1999, now 2 M customers, 400 employees. Profitable in Sept 1999. Business model pay users 50c per hour. Also make money when referring people `multi-level business model', discourages exit.

Now unstable equilibrium. [Bill Burnham].

Who participates now in Electronic Commerce

Burnham expects mass marketification of B2C in the US. Soon most users will have free ISP accounts. Now mean income of Internet users is $75K/year, but that market is\getting saturated. Non-participants may be older. Growth will be now in the lower income mass-market ($20K-40K). Pricing for that category will become more important, and they will have lower service expectations. For example: 1/3 of Walmart customers check prices at Target and vv.

Congestion

Bad service discourages customers. Supplier can increase number of servers. Line congestion is harder to deal with.

When the number of customers grows, then the capability of the service must also increase. Some of that can be achieved by getting a bigger or better computer. Another approach is to clone the system, i.e., make multiple copies ofvthe computer and its software, all accessed via a proxy (sometimes a firewall) so that only one adress is needed for the customer.

Having multiple, identical computers also provides apparent reliability. Now, if one of the clones fails, service can continue. Only current clients are affected. If the reliability of one system is 90%, for a two clone system the reliability is nearly 99%. Having a proxy reduces system reliability a bit.

Keeping Track of A Client

Cloning leads to a problem of keeping track of a client's interaction. The client, on a subsequent request may be directed to another clone.

It is not desirable to maintain client state in the cloned front-end systems because this works against transparent client failover and load balancing. There are two principal ways to maintain client state across sessions. One is to store client state in a partitioned back-end server. (Client state can be partitioned perfectly, and therefore it scales well. However, it is necessary to retrieve this state on each client request.) Another way to maintain client state across sessions is to use cookies and/or URLs. Cookies are small files managed by the client's Web browser. They are invaluable for minimizing load on stateful servers and maximizing the utility of stateless front ends. Data can also be stored in URLs and returned when the user clicks on the link on the displayed Web page. [Microsoft DNA guidance]

Methods to retain state information

Web linkages are stateless: each transaction is disjoint. But for e-commerce there are normally incremental interactions, as seraching for some kind of serviceor object, finding suppliers, comparing prices and quality, and finally purchasing it. All these require some indication of state, so that the client does not have to reenter all previously found information. There are several techniques in use:

1. The server makes up a form for resubmission by the client with a click, which contains relevant state information so far gathered.
2. The server makes up a query for resubmission by the client with a click, whiche embodies the required state so far gathered.
3. The server makes up a query for resubmission by the client with a click, whiche embodies a reference to a record in the server which contains all of the state so far gathered. If the client does not respond for a long time, a garbage collector in the server removes the record.
4. The server deposits a cookie in a file of the client with relevant information. The cookie is read at a subsequent transaction. The transaction can be at long intervals. This process requires some program execution in the client for deposuting and reading cookies, initiated by the server, often using JAVA applets.
5. One of the recent proposals is used to manage state, as RDS ADO. RDS requires services in the browsers that make a table available to the server, that the server can use to deposit and extract information. RDS links to database services, so that the quantity of state information can be very large, say an entire catalog of goods.

Notes

A view of the Internet from a Social Science Viewpoint [Shortliffe and Patel: 2000].

See also the references.