The History and Evolution of E-Commerce


Electronic commerce (EC) describes the manner in which transactions take place over networks, mostly the Internet. It is the process of electronically buying and selling goods, services and information. Certain EC applications, such as buying and selling stocks and airline tickets on the internet, are growing very rapidly, exceeding non-Internet trades.

EC is not just about buying and selling, it also is about electronically communicating, collaborating, and discovering information (sometimes referred to as e-business). It is about e-learning, e-government, social networks, and much more. EC will have an impact on a significant portion of the world, affecting businesses, professions, and, of course, people.



Development of EC applications started in the early 1970s with electronic funds transfer (EFT), which refers to the computer-based systems used to perform financial transactions electronically. However, the use of these applications was limited to financial institutes, large corporations, and some daring businesses.

Electronic data interchange (EDI) was then developed in the late 1970s to improve the limitation of EFT. EDI enlarged the pool of participating company from manufacturers, retailers, services, and others. Such systems were called Interorganizational System (IOS).

An Interorganizational System (IOS) allows the flow of information to be automated between organizations to reach a desired supply-chain management system, which enables the development of competitive organizations.

From the 1990s onwards, electronic commerce would additionally include enterprise resource planning systems (ERP), data mining and data warehousing.

 The term electronic commerce’ was coined in the early 1990s when Internet became commercialized and users began flocking to participate in the World Wide Web. EC applications were then rapidly expanded.

Possibly EC is introduced from the Telephone Exchange Office. The earliest example of many-to-many EC in physical goods was the Boston Computer Exchange, a marketplace for used computers launched in 1982. The first online information marketplace, including online consulting, was likely the American Information Exchange, another pre-Internet online system introduced in 1991.


Here’s a video on the Origins of E-commerce:





Since 1995, many innovative applications, ranging from direct online sales to e-learning experiences had been developed. Almost every organization in the world has a Web site.

In 1999, the emphasis of e-commerce shifted from B2C to B2B.

In 2001, from B2B to B2E, e-government, e-learning, and m-commerce.

In 2005, social networks started to rise and so did l-commerce and wireless applications.

E-commerce will undoubtedly continue to shift and change in the future.






EDI, or electronic data interchange, was standardized   through ASC X12. This guaranteed that companies would be able to complete transactions with one another reliably.  


 Compuserve offers online retail products to its customers. This gives people the first chance to buy things off their computer.  



 Netscape arrived. Providing users a simple browser to surf the Internet and a safe online transaction technology called Secure Sockets Layer.



 Two of the biggest names in e-commerce are launched: Amazon.com and eBay.com.  



DSL, or Digital Subscriber Line, provides fast, always-on Internet service to subscribers across California. This prompts people to spend more time, and money, online.



 Retail spending over the Internet reaches $20 billion, according to Business.com.  


 The U.S government extended the moratorium on Internet taxes until at least 2005.  

 Source: http://newmedia.medill.northwestern.edu/courses/nmpspring01/brown/Revstream/history.htm




Related Link(s):


Prepared by Lim Xin Ying

1 Response to “The History and Evolution of E-Commerce”

  1. 1 Carl Preston
    July 6, 2008 at 10:57 am

    i like the video

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