Chapter Two: Technology in E-procurement

Learning outcome
After completing this chapter learners should able to:
 Understand the evolution of internet
 Identify the different types Internet protocols
 Assess different markup languages
1. Origins of the Internet and New Uses for the Internet
The first recorded description of the social interactions that could be enabled through networking
was a series of memos written by J.C.R. Licklider of MIT in August 1962 discussing his
“Galactic Network” concept. He envisioned a globally interconnected set of computers through
which everyone could quickly access data and programs from any site. In spirit, the concept was
very much like the Internet of today.
Leonard Kleinrock at MIT published the first paper on packet switching theory in July 1961 and
the first book on the subject in 1964. Kleinrock convinced Roberts of the theoretical feasibility of
communications using packets rather than circuits, which was a major step along the path
towards computer networking.
The Internet has shown extraordinary growth patterns when compared to other electronic
technologies of the past. It took radio 38 years to achieve a 30% share. It took television 17 years
to achieve a 30% share. Since the invention of a graphical user interface for the World Wide
Web in 1993, it took only 10 years for the Internet/Web to achieve a 53% share of U.S.
households.
The Internet today is a widespread information infrastructure, the initial prototype of what is
often called the National (or Global or Galactic) information infrastructure. Its history is complex
and involves many aspects - technological, organizational, and community. And its influence
reaches not only to the technical fields of computer communications but throughout society as
we move toward increasing use of online tools to accomplish electronic commerce, information
acquisition, and community operations.
2. The Internet, Intranets, Extranets and the World Wide Web
2.1. Internet

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The Internet is world-wide broadcasting capability, a mechanism for information dissemination,
and a medium for collaboration and interaction between individuals and their computers without
regard for geographic location.
The Internet is a public and global communication network that provides direct connectivity to
anyone over a local area network (LAN) or Internet Service Provider (ISP).
The internet is the world’s largest computer network. It is a worldwide network of computers
that use common communication standards and interfaces to provide the physical backbone for a
number of interesting applications.
The Internet links businesses, educational institutions, government agencies, and individuals
together, and provides users with services such as e-mail, document transfer, newsgroups,
shopping, research, instant messaging, music, videos, and news. One of the key advantages of an
intranet is the broad availability and use of software applications unique to the needs of a
corporation.
2.2. Intranet
Organizations can use Internet networking standards and Web technology to create private
networks called intranets. Intranet is an internal organizational network that provides access to
data across the enterprise. It uses the existing company network infrastructure along with Internet
connectivity standards and software developed for the World Wide Web. Intranets can create
networked applications that can run on many different kinds of computers throughout the
organization, including mobile handheld computers and wireless remote access devices.
The intranet links various servers, clients, databases, and application programs like Enterprise
Resource Planning (ERP). Although intranets are developed on the same TCP/IP protocol as the
Internet, they operate as a private network with limited access.
An intranet is protected by security measures such as passwords, encryption, and firewalls, and
thus can be accessed by authorized users through the Internet. Only authorized employees are
able to use it. Intranets are limited to information pertinent to the company and contain exclusive
and often proprietary and sensitive information. Just think of an intranet as a private version of
the Internet. TCP/IP stand for Transmission control protocol/Internet protocol that used to
interconnect network device on the internet and other computer network.
2.3. Extranet

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 Extranet refers to a private network that connects various stake holders such as vendors, clients,
suppliers on a common networked platform to exchange business related information. When the
intranet is configured over a geographic boundary beyond the organization it is termed as an
extranet. Extranet is also termed as extended intranet.
An extranet is a collaborative network that uses internet technology to link businesses with their
suppliers, customers or other businesses that share common goals. Extranets are usually linked to
business intranets where information is either accessible through a password system or through
links that are established collaboratively.
Both intranets and extranets reduce transaction and agency costs by providing additional
connectivity for coordinating disparate business processes within the firm and for linking
electronically to customers and suppliers. Private industrial networks are based on extranets
because they are so useful for linking organizations with suppliers, customers, or business
partners. Extranets often are employed for collaborating with other companies for supply chain
management, product design and development, and training efforts. Extranets uses TCP/IP
protocol network (like the internet) to link intranet in different location or specific protocols.
Table 2.1. Overview: Internet, Intranet, and Extranet
Internet Intranet Extranet
It is a global system of It is a private network specific to It is a private network that uses public
interconnected computer an organization. network to information with suppliers
networks. vendors
Not regulated by any one. It is regulated by an organization It is regulated by multiple
depends on the software organizations.
application connected
device.
Thus content in the network Thus content in the network is The content in the network is
is accessible to everyone accessible only to members of accessible to members of organization
connected. organization. and external members with access to
network.
It is largest in terms of It is small network with minimal The number of devices connected is
number of connected device. number of connected device. comparable with intranet.
It is owned by no one. It is owned by single It is owned by single/multiple
organization organization.
It is means of sharing It is means of sharing sensitive It is means of sharing information
information throughout the information throughout between members and external
world. organization members.

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Security is depending of the Security is enforced via a Security is enforced via a firewall that
user of device connected to firewall. separates internet and extranet.
network.
Users can access internet Users should have valid Users should have valid
anonymously. username/password to access username/password to access extranet.
intranet.

Figure 2.1. E-Business Infrastructure

2.4. World Wide Web
The World Wide Web (the Web) is the most popular service that runs on the Internet
infrastructure. The World Wide Web is a part of the internet, which supports hypertext
documents, allowing users to view and navigate different types of data. With its ease of use and
its multimedia ability to transmit text, graphics, audio, and video and to retrieve detailed
information from anywhere in the world in seconds, the WWW has quickly become the interface
of choice for Internet users.
It offers a way to access documents spread over the several servers over the internet. These
documents may contain text, graphics, audio, video, hyperlinks. The hyperlinks allow the users
to navigate between the documents.
It is a system with universally accepted standards for storing, retrieving, formatting, and
displaying information using client/server architecture. Web pages are formatted using hypertext
with embedded links that connect documents to one another and that also link pages to other

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objects such as sound, video, or animation files. When you click a graphic and a video clip plays,
you have clicked a hyperlink.
The Internet prior to the Web was primarily used for text communications, file transfers, and
remote computing. The Web introduced far more powerful and commercially interesting,
colorful multimedia capabilities of direct relevance to commerce. In essence, the Web added
color, voice, and video to the Internet, creating a communications infrastructure and information
storage system that rivals television, radio, magazines, and even libraries.
3. Internet Protocols
The Internet protocols are the world’s most popular open-system (nonproprietary) protocol suite
because they can be used to communicate across any set of interconnected networks and are
equally well suited for LAN and WAN communications. The Internet protocols consist of a suite
of communication protocols, of which the two best known are the Transmission Control Protocol
(TCP) and the Internet Protocol (IP). The Internet protocol suite not only includes lower-layer
protocols (such as TCP and IP), but it also specifies common applications such as electronic
mail, terminal emulation, and file transfer.
Purpose of the Internet Protocol
 The IP protocol defines the basic unit of data transfer (IP datagram)
 IP software performs the routing function
 IP includes a set of rules that embody the idea of unreliable packet delivery:
 How hosts and routers should process packets
 How and when error messages should be generated
 The conditions under which packets can be discarded.
A TCP/IP internet provides three sets of services as shown in the following figure

Figure 2.1. three sets of services of internet

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 4. Web Page Request and Delivery Protocols
A web page (or webpage) is a web document that is suitable for the World Wide Web and the
web browser. A web browser displays a web page on a monitor or mobile device. The web page
is what displays, but the term also refers to a computer file, usually written in HTML or
comparable markup language, whose main distinction is to provide hypertext that will navigate
to other web pages via links.
web page - A Web page is a simple text file that contains not only text, but also a set of HTML
tags that describe how the text should be formatted when a browser displays it on the screen. The
tags are simple instructions that tell the Web browser how the page should look when it is
displayed. The tags tell the browser to do things like change the font size or color, or arrange
things in columns. The Web browser interprets these tags to decide how to format the text onto
the screen.
Web browser - A Web browser, like Netscape Navigator or Microsoft Internet Explorer, is a
computer program (also known as a software application, or simply an application) that does two
things: A Web browser knows how to go to a Web server on the Internet and request a page, so
that the browser can pull the page through the network and into your machine. A Web browser
knows how to interpret the set of HTML tags within the page in order to display the page on
your screen as the page's creator intended it to be viewed.
HTTP is a simple request delivery system. The standard procedure to get a page in a Web
browser starts with a request from the browser to the Web server for that page. The server
delivers that page in the response and the transaction ends. Many Web pages contain references
to other files. For example, if there is a picture in the page, that image is not embedded in the
HTML creating the page. Instead, the HTML of the Web page contains a reference to another
file that contains the picture. On encountering the reference, the browser has to send another
request to the server for that new file. Each request returns one file. The process of interpreting
an HTML document into a viewable page may require many requests to the server to retrieve all
the files that make up that page.
5. Electronic Mail Protocols
Email protocols are the languages and rules that email servers and clients use to communicate
with each other and manage incoming and outgoing mail. Electronicmail isthe transmission of
messages over communications networks. The messages can be notes entered from the keyboard

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or electronic files stored on disk. Companies that are fully computerized make extensive use of
e-mail because it is fast, flexible, and reliable. These protocols are strictly defined and are in use
in a variety of different email clients. In addition, each email protocol has a unique way of
managing email that is sent and received from an email account.
Most e-mail systems include a rudimentary text editor for composing messages, but many allow
you to edit your messages using any editor you want. An email message is created using a mail
client program. This program then sends the message to a server. The server then forwards the
message to the recipient's email server, where the message is then supplied to the recipient's
email client. To enable this process, a variety of standard network protocols allow different
machines, often running different operating systems and using different email programs, to send
and receive email.
6. Markup Languages and the Web
7. EDI
Electronic data interchange (EDI) is an information technology that standardizes the exchange of
information between two parties to a transaction.
EDI technology allows business partners with recurring transactions to establish secure
computer-to-computer exchange of data in standard formats.
EDI is traditional mailing and faxing of documents with a digital transfer of data from one
computer to another.
EDI (Electronic Data Interchange), a more traditional way of electronically linking between
buyers and sellers, can eliminate much of the administrative trivia and paperwork from the
traditional buyer/seller relationship but it has proven to be extremely complex, costly, and
difficult to implement and maintain.
EDI (Electronic Data Interchange) EDI is an application whereby electronic messages can be
exchanged between computer programs of two separate organisations. Some features of EDI
include:
Messages are exchanged in groups, known as batches.
Messages can be automatically sent, transmitted and stored between computers without retyping
or keying data.
EDI has to be implemented by each pair of organisations (sender and receiver) who wish to use
it. This means that the implementation costs of EDI are relatively high.

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EDI is mostly used where the messages exchanged concern such matters as orders,
confirmations, transport information and invoicing.
EDI traditionally runs on so-called, “Value Added Networks”, which are closed networks (unlike
open networks like the Internet).

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