Retail fraud is rife on the Internet

E-commerce on retail Web sites is the wave of the future, but there are hiccups as fraud takes its toll on electronic retailers (e-tailers), who are also being squeezed by the credit card companies. A recent Gartner survey of more than 160 companies revealed that 12 times more fraud exists on Internet transactions and that e-tailers are paying credit card discount rates that are 66 per cent higher than traditional retailer fees. Moreover, Web merchants bear the liability and costs in cases of fraud, while credit card companies generally absorb the fraud for traditional retailers (as long as the retailer follows procedures and saves a physical signature on a credit car transaction receipt).

Surveyed e-tailers reported that their average credit card discount rate was 2.5 per cent plus about 30 cents a transaction. The same average for traditional retailers is about 1.5 per cent plus 30 cents a transaction. Therefore, a merchant may pay credit card processors $2.80 for selling a shirt online, but pay only $1.80 for the same transaction in the physical store. Another kicker, according to the Gartner survey, is that in resolving and processing chargebacks, e-tailers spend about four times the amount that retailers do.

PDAs yet to become enterprise solutions

Analysts at Giga Information Group state that it's too soon for corporate environments to adopt any single personal digital assistant (PDA) platform as a technology standard. While some classes of highly mobile individuals, such as sales professionals, can benefit from PDAs, Giga advises that it is hard to justify the costs of supporting the majority of casual users in most enterprises.

"While the Palm is a viable technology and getting more robust all the time, it is presently too far ahead of the curve for most mainstream enterprises. And at this point, when the total cost of management is considered, it is definitely an expensive optional solution rather than a ‘must-have' connectivity device," Giga analysts claimed, Despite all the hype, it should be kept in mind that fewer than 10 million Palms are in use today.

Taxes and tennis dominate Net in June

The advent of the GST, the lifetime healthcover deadline, and some gripping tennis led to a surge in traffic to related Internet sites during June, according to a report released recently by Media Metrix.

The Media Metrix Audience Ratings Report for June, which measures home Internet usage over the month, showed that traffic to the Australian Tax Office site, increased by more than 50 per cent as the nation approached the GST deadline. Healthcare sites such as, and appeared in the ratings for the first time as Australians rushed to beat the July 1 cut-off date; and tennis grabbed the attention of online audiences as more than 100,000 followed their favorites through the French Open and saw the number of unique visitors to its site grow by 130,000 over the month, raising the total number of people to visit the site during June to 353,000. This equates to 6.2 per cent of the Australian online population and a 55 per cent increase in traffic to the site. Two more government sites, and, which were set up specifically to deal with the GST transition attracted 62,000 and 86,000 unique visitors respectively to their online locations.

Home office internet use on the rise

The number of US home office PC households with Internet access has risen significantly, according to a recent study by market research company International Data Corporation (IDC). IDC found that the percentage of Internet active home offices swelled to 81 per cent at the end of 1999, up from 26 per cent at year-end of 1996. The company's analysts expect the number of Net-enabled home offices to reach 92 per cent by 2004. They noted that a move to the Web can reduce some of the logistical limitations traditionally presented by a home office and may also provide a chance for expansion into previously inaccessible territory.

With Internet-ready PCs becoming commonplace and high-speed connections now readily available, IDC analysts noted that most of the tasks performed in a home office pose few difficulties for individuals with the right tools. While cable modem and DSL (digital subscriber line) connections accounted for 3.4 per cent and less than 1 per cent respectively of 1999 U.S. home offices, IDC claimed that these numbers will grow to 15 per cent and more than 23 per cent respectively by 2004. This trend towards broadband connections could push the usage of traditional dial-up connections in home offices down to 55 per cent in 2004 -- a sizeable drop from the 1999 figure of 95 per cent.

B2C to becomes big business

Despite the recent dot-com shakeouts, market research firm Giga Information Group predicts that strong B2C (business-to-consumer) sales in the US will grow from an estimated $US25 billion in 1999 to reach $US152 billion in 2003 -- and $US233 billion in 2004 according to a recently released report.

The face of B2C sales will change, Giga analysts said, and multi-channel or "click-and-mortar" stores are expected to dominate B2C Internet sales by 2002, snagging two-thirds of Net spending, or $US92 billion in Internet sales. Travel companies, brokerages and computer companies dominated click-and-mortar sales in 1999, with one-third of the market. However, Giga noted that retail companies like Gap, Borders Group, Wal-Mart Stores, Toys R Us, and Staples showed that other "real world" retailers could compete effectively on the Net.

Information access tools hit their strapsRevenues in the worldwide information access tool (IAT) software market climbed almost 21 per cent to almost $US8 billion in 1999, and growth in this market will remain about 20 per cent at least until the end of 2004, according to studies by IDC. The researcher believes the market is on track to exceed $US20.6 billion by 2004.

The overall information access tools market will earn sold growth of approximately 21 per cent compounded annually through 2004, said IDC. However, comparing the growth rates of each of the market's segments will reveal significant discrepancies. End-user query and reporting, data mining, and online analytical processing will be fast growers, while executive information systems, spreadsheets and statistical and technical data analysis will all be slow-growing markets.

In terms of vendors, IDC believes that Microsoft -- with its new OLAP Services for SQL/Server -- will help generate IAT market growth. Already, after only one full year on the market, Microsoft's new product has reached the number six spot in the online analytical processing segment and 10th place in the enterprise decision support segment. As Microsoft OLAP service applications go into production, a positive rippling effect will occur for related OLAP clients and reporting tools, IDC analysts believe.

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