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Edwina Wasson and Ronald Taylor are the owners of
Stellar Coffee (located at 6003 NE Martin Luther King
Blvd.). They offer the Stellar Card similar to a debit
card which can be used for purchasing food there. The
cards are sold like pre paid calling cards for anywhere
from $10 to $50 maximum. Their new customer service
technology is convenient and gaining in popularity.
The future of shopping, many
Internet merchants insist, is elec
tronic commerce - using your com
puter as a shopping cart and the
World Wide Web as a giant mall.
There is already plenty to buy -
from software to automobiles, from
specialty teas to statistical data -
without leaving home. But how will
you pay for your purchases?
Today, if you want or need to
pay online, you’ll probably key in
your credit-card number and expi
ration date, then cross your fin
gers because you’ve heard all the
horror stories about cyberthieves.
Despite the secure transmission
protocols now used by many
Internet merchants, many consum
ers are still fearful of entering credit-
card numbers online.
Credit card companies are work
ing hard to develop better Internet
security measures, such as a new
Secure Electronic Transaction pro
tocol (SET) for encryption and au
thentication of transactions. Un
fortunately, such protocols also
slow down processing so much
that transactions may take several
minutes. That is surely a minor
delay compared with a trip to the
store, but one that irritates those
who’ve become spoiled by nearly
instantaneous electronic ex
changes.
ited liability if the smart card is lost
or stolen. Many enthusiasts want
digital money to become just like
paper money - they look forward
to the day when it can be freely
exchanged between any two people
holding it, rather than only between
pre-certified, licensed customers
and merchants.
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DK.I I Yl MOM A
No one is yet sure what kind of
electronic currency, if any. Forex-
ample, would you want it to be
unattributed or anonymous, as is a
$10 bill, so that once you have
received the goods and paid the
merchant with electronic tokens
no record exists of who made the
purchase? That kind of privacy is
valuable to people who are con
cerned about the financial trail cre
ated by the use of ATMs, credit
cards, and debit cards. On the other
hand, in exchange for anonymity
you would have to live without
consumer protections such as lim
If digital money is to be like
paper money, it will have to be not
only anonymous but also:
•Portable - which would mean at
a minimum transferable between
computer, laptop, and a smart card
so that you can access it wherever
you are.
•Widely accepted, so that you
can use just one kind of digital
money and spend it in many places,
for many things.
•Interchangeable - the value of
money may change over time, but
at any given place at a given time,
one $10 bill is worth exactly the
same as another $ 10 bill.
•Indefinite - you don’t want it to
expire unspent, although this
poses the problem of how long any
encryption can be expected to re
sist those determined to break it.
•Divisible - you want to be able
to “make change,” or break large
units down into smaller ones that
are simple to use.
FOR MERC 11 WTS
Digital money could have big
appeal over credit cards if they are
paid immediately and if transac
tion costs are a lot lower. Immedi
ate payment depends on the de
sign of the digital money being
used; lower costs already look
promising, but not yet certain. One
new “e-cash” system now being
field tested in Australia will charge
consumers thirty cents a transac
tion on top of the charge for load
ing funds into an electronic wallet
C6
eRelationship
Management
DIGITAL MONEY
B y V ary C oates and S teven
B onorris — -------------------
Oct.6, 1999
on their hard drive. If consumers
react to such costs with a resound
ing “no, thanks,’ it is likely that
issuers will find a way to shift
those charges to merchants, leav
ing them little better off than with
credit cards.
Uncertainties remain: What if
the issuer of your digital money
goes bankrupt after you buy its
monetary tokens but before you
spend them? Can you be sure to
find a merchant who accepts the
tokens and that there’s something
you want to buy? Do you care if
digital money allows issuers and
merchants to build a dossier on
your spending habits, the better
to target you with customized ad
vertising? If privacy concerns you,
perhaps you will opt for a kind of
digital money that promises ano
nymity, at least at the transaction
stage. But then you must give up
indemnity for lost or stolen to
kens.
What then is the outlook for
digital money? The likeliest sce
nario is that a simple form of elec
tronic token will evolve, possibly
issued by banks but available also
from brokers, that is easily ex
changeable among smart cards,
store-based readers, bank ATMs,
and computer hard drives.
Digital money may prove most
popular and useful to consumers
for very small purchases of infor
mation and related services and
amenities over the Internet. Some
consumers may also use digital
money along with credit and debit
cards for store purchases as well.
In short, digital money is likely
to start small, more of an elec
tronic change purse than a stuffed
wallet.
V ary C oates and Steven
Bonorris can be reached by e-mail
at ita@concentric.net.
In d u stry
L e a d e rs
lik e
Hewlett-Packard, Lucent Tech
nologies and Apple Computer
have not turned a deaf ear to the
growing demands o f Web us
ers. In fact, for these com pa
nies, moving costly customer
services to the Internet is c riti
cal to staying com petitive.
And providing custom er ser
vices on the Internet means a
lot more than just having a Web
site.
“As Internet users demand
more services on the Internet,
we are helping companies like
Hewlett-Packard realize their e-
services strategies on the Web,”
says David Swan, CEO of World
Wide Web Associates, the lead
ing eRelationship Management
company.
“The largest corporations and
e-giants are focused on today’s
most pivotal business problem:
adding the ‘e ’ to custom er rela
tionship m anagem ent,” says
Sw an. “ The top co m p an ies
w orldw ide w ill require cu s
tom er-directed e-business so
lutions to be leaders in this new
economy. Our customer-compa
nies like HP, Lucent Technolo-
gies and Apple Computer are
taking the lead.”
Traditionally, managing valu
able customer relationships is
an expensive and tim e-consum
ing effort. But companies mov
ing C u sto m er R e la tio n sh ip
Management (CRM) services to
the Web can serve their cus
tomers better while realizing
huge cost savings on customer-
related business processes.
eR elationship M anagement
(eRM) is also better for the cus
tomer: on-demand access to in
form ation, less hassles with
better support, and less expen
sive services.
Applying Internet technolo
gies to a com pany’s custom er-
related processes can involve
integrating numerous commu
n ic a tio n s ch an n els and d e
vices, autom ating services and
transactions, and providing in
teractive support on the desk
top that connects directly to
the Web.
For m ore inform ation on
e R e la tio n sh ip M anagem ent,
go
to
w w w a.com
or
w w w .fo rre s te r.c o m on the
Internet.
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