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Although primarily an economic phenomenon, electronic commerce forms part of a broader process of social change, characterized by the globalization of markets, the shift towards an economy based on knowledge and information, and the growing prominence of all forms of technology in everyday life.[1]

Definitions Edit

E-commerce (also called electronic commerce or digital commerce) is

any transaction conducted over the Internet or through Internet access, comprising the sale, lease, license, offer, or delivery of property, goods, services, or information, whether or not for consideration, and includes the provision of Internet access.[2]
any business transaction whose price or essential terms were negotiated over an online system such as an Internet, Extranet, Electronic Data Interchange network, or electronic mail system. It does not include transactions negotiated via facsimile machine or switched telephone network, or payments made online for transactions whose terms were negotiated offline.[3]
[t]he production, advertising, sale and distribution of products via telecommunications networks.[4]
includes any transaction for the sale or purchase of goods and services conducted over computer networks by methods specifically designed for the purpose of receiving or placing of order.[5]
the sale or purchase of goods or services, conducted over computer networks by methods specifically designed for the purpose of receiving or placing of orders. The goods or services are ordered by those methods, but the payment and the ultimate delivery of the goods or services do not have to be conducted online. An e-commerce transaction can be between enterprises, households, individuals, governments, and other public or private organisations. To be included are orders made over the web, extranet or electronic data interchange. The type is defined by the method of placing the order. To be excluded are orders made by telephone calls, facsimile or manually typed e-mail."[6]

Overview Edit

Electronic commerce has delivered enormous benefits for consumers. Prices have dropped due to the ease of Internet comparison shopping. The marketplace has expanded as barriers to entry have diminished and buyers and sellers easily link up through websites such as eBay. And transactions are now quickly and conveniently conducted from a home computer, without the hassle of waiting in a line, holding on the telephone, or mailing a check.

Economic growth in e-commerce Edit

Between 1999 and 2007, the United States economy enjoyed an increase of over 500% in business-to-consumer online commerce.[7] Taking into account business-to-business transactions, online commerce in 2007 accounted for over $3 trillion dollars in revenue for U.S. companies.[8] The economic benefits provided by the information economy increased even during our economic downturn. During 2008, industry analysts estimate that sales of the top 100 online retailers grew 14.3%.[9] In contrast, the U.S. Census Bureau estimates a 0.9% decrease in total retail sales over that time period.[10]

Global online transactions currently total an estimated $10 trillion annually.[11] In the United States alone, according to the U.S. Census, domestic online transactions are currently estimated to total $3.7 trillion annually.[12] In 2009 alone, online retail sales accounted for over $140 billion in retail sales for U.S. companies.[13]

In 2009, U.S. mobile commerce sales grew over 200% compared to the previous year, reaching $1.2 billion.[14] Analysts expect this growth to continue in 2010, projecting $2.4 billion in mobile commerce.[15] Online sales growth and expanding information systems are creating new jobs focused on the information economy and directly impacting the nation's economic recovery.

In addition to the growth of online commerce, the Internet, the World Wide Web, and associated information systems have lead to an unprecedented growth in productivity over the last decade.[16] More businesses are using the Internet to provide electronic records to customers and trading partners, and enterprises are shifting to a digital back office and greener business environment.

Sustaining the growth of digital commerce and U.S. commerce generally will require continued innovation in how information is used and shared across the Internet. Commerce today depends on online communication and the transmission of significant amounts of data.

Importance of digital content Edit

E-commerce and investment in information systems continue to create new jobs in the Internet economy and to contribute to national economic recovery.[17] An important component of the growth in e-commerce is the rapid increase in the sale of digital content across the creative industries.[18] For example, sales of digital music downloads in the United States were estimated to reach $3.1 billion in 2009, a 19% increase above 2008 sales.[19] Likewise, revenues derived from the sale of online videos were estimated to reach $1.2 billion in 2008, and are expected to climb to $4.5 billion by 2012.[20] In 2009, revenues from the sale of e-books were estimated at $313 million, 177% above sales from the previous year and, for the first time ever, exceeding revenues from the sale of audiobooks.[21] The popularity of online games is also on the rise, with a forecast to double 2009's $2.8 billion in online sales by 2015.[22] As these data suggest, the availability and consumption of a wide range of lawful online creative works are increasing rapidly and contribute an increasingly important component of national e-commerce growth.

Privacy concerns Edit

Consumers have expressed concern regarding new or unexpected uses of their personal information by online applications. Since e-commerce is dependent on consumer participation, consumers must be able to trust that their personal information is protected online and securely maintained. At the same time, companies need clear policies that enable the continued development of new business models and the free flow of data across state and international borders in support of domestic and global trade.

References Edit

  1. The Economic and Social Impact of Electronic Commerce: Preliminary Findings and Research Agenda, at 143.
  2. 47 U.S.C. §151 sec. 1004(3) (1998).
  3. U.S. Census Bureau, Glossary (full-text).
  4. DOHA WTO Ministerial 2001: Glossary of Terms.
  5. Electronic and Mobile Commerce, at 6.
  6. Electronic and Mobile Commerce, at 38 n.2.
  7. U.S. Census Bureau, "E-Stats" (May 28, 2009).
  8. Id.
  9. Mark Brohan, "The Top 500 Guide," Internet Retailer (June 2009).
  10. U.S. Census Bureau, "Quarterly Retail E-Commerce Sales: 4th Quarter 2008," Feb. 16, 2010, Table 4.
  11. Information Technology and Innovation Foundation (ITIF), The Internet Economy 25 Years After .com (Mar. 15, 2010) (full-text).
  12. U.S. Census Bureau, "E-Stats" (May 27, 2010) (full-text).
  13. U.S. Census Bureau, "E–Stats" (May 28, 2009), at 2 (full-text).
  14. "U.S. M-Commerce Sales to Hit $2.4 Billion This Year, ABI Research Says," Internet Retailer (Feb. 16, 2010).
  15. Id.
  16. Executive Office of the President, Council of Economic Advisors, 2010 Economic Report of the President, Ch. 10 (Feb. 2010).
  17. Remarks of Gary Locke, Secretary of Commerce, Privacy and Innovation Symposium (May 7, 2010) (full-text).
  18. OECD Information Technology Outlook 2008, at 250 (2008). The fair use of copyrighted works is also believed to contribute to the Internet economy. See Computer and Communications Industry Association (CCIA), "Fair Use in the U.S. Economy: Economic Contribution of Industries Relying on Fair Use," at 4, 8 (2010) (full-text).
  19. Joshua P. Friedlander, Recording Indus. Association of America (RIAA), 2009 Year-End Shipment Statistics (full-text).
  20. Press Release, "In-Stat, Explosive Growth Forecast in Online Video Market, Netflix Subscription Model Wins" (Aug. 13, 2008) (full-text).
  21. Press Release, Association of American Publishers, "AAP Reports Book Sales Estimated at $23.9 Billion in 2009" (Apr. 7, 2010).
  22. Press Release, Pike & Fischer, "U.S. Online Game Subscribers to More than Double in Five Years, Pike & Fischer Projects" (Jan. 28, 2010) (full-text).

See also Edit

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