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August 27, 1998


'We've a long way to go'

Email this story to a friend. Back to IIW coverage index. iPass chief Chris Moore tells Madhuri Velegar K about the future of e-commerce.

How do you define e-commerce?
It's a financial transaction on the Internet; your site accepting credit cards is part of the definition. A vast majority of e-commerce today is (conducted as) business to business transactions, buying and selling products or services over the Net.

There are going to be two parts to this. For a human being, there's a process of requesting a proposal, sorting out the bits. Where it's an automated process, much of what happens behind my machine makes me decide on my lead time and reduces my costs immediately.

Do you think it necessary to look at e-commerce from the two perspectives of being on the web and off the web, or do you think a more unified approach should be taken?
I don't think there is any need for any unified approach. I think it's too late to ever think that way when so much innovation and creation is happening within the industry. Now the industry needs more alternatives and not unified ones.

What are the competing standards of e-commerce security and protocols today? What are the advantages and disadvantages?
I am not very knowledgeable about this...

Could you do some visionary stuff and tell us about emerging trends in e-commerce?
Well, we already see a lot of e-commerce in terms of web-based commerce services and sites accepting credit cards from a user. I believe that over the next couple of years that will continue to dominate the Web. It's building very simple web environments for corporations to offer store fronts on the Web -- that's where everybody's attention will be focussed.

It's a space so specific to large commercial transactions that it's hard to think about it in a visionary way. It's like a rock pit, if you will. We all need rocks with instructions, not necessarily with rock pits -- but it's a bit like my business in iPass. We're never an example like that -- we have a very specific commerce function: that is, buying and selling Internet access between ISPs and the settlements of those transactions.

What about security in your business?
Security is a critical part of our business because your user name and password is going to cross the Internet. So we provide strong encryption and authentication technologies that are proven to match the standards of ISA encryption. (We have) SSF as a protocol to carry that encryption so it's a critical foundation to our system.

Do you think Microsoft Wallet, Navio operating system or other similar gadgets will become popular in the future?
I do. Absolutely. I used to work for a company called General Magic that made small Intel devices. I'm the first person to buy a device -- they're so important.

I feel sort of lost -- I left my device, Nino Windows CE Intel device (my calendar etc is all in it) -- back home.

It's funny that we think that's competing but the direct competition for the device is not the computer but your pen and paper.

And the Windows CE provides a lot of functions. It does not require a user manual. That's the hands off pen and paper vs $ 350 of Nino. I just bought this for all my executive staff who were used to the paper calendar. It allows you to schedule meetings, keep info up to date a lot better than a paper calendar.

What percentage of transactions are done over the Internet today?
I don't think it's even one per cent. It's tiny. What was the total electronic commerce last year? Less than $ two billion worldwide. Forty percent was Cisco selling routers for a very specialised segment over the Web. It's an embryonic industry; it's just getting penetration into the established way that we do commerce.

How fast is it growing?
It's growing several 100 per cent per year but that's a little bit deceptive, because the starting number is so small. If you start at one, then to get to two is 100 per cent growth. That same growth doesn't happen the next time. Now the percentage growth is staggering but the actual numbers remain relatively small. And when we consider e-commerce over the Net, it's practically nil. We've a long way to go.

How did you come upon the iPass strategy? What elements motivated you to gain control over Internet access, on its backbone?
I was working in Hong Kong and I travelled a lot. I got tired of seeing the phone bill of my hotel room higher than even my air ticket! It's crazy how expensive and crazy it is to access your company's modems. I did a study on the subject. I asked people who travelled how they got email, and everyone had the same problem. They were unhappy.

Hotel connections were expensive, calling cards were expensive and complicated and there was a fear of being cut off 20 times before you finished. So I thought of this as a business which like to call "passes the elevator test". By the time it takes the elevator to reach the top, I get the message -- and here's where people say, "I need that."

How do you see the growth of the Internet in India?
The market here is exploding, so again it's starting from a very small penetration by businesses and users today. But the percentage growth will be spectacular in the next few years.

In terms of absolute users or dollars, we don't know. We're very impressed with the government's emphasis on helping technology all over the country and to see that India is completely in the front in the Internet age.

It's hard to gauge. We're happy to be talking about the Internet now; we've met so many people who have great plans...

Do you think e-cash will come in?
I think the feature of good money is when it is earning interest in my bank. I have no desire to use e-cash, If I have the alternative to use debit/credit. I'll use credit cards. All those technologies that require technologies -- the idea of stored value in a card... I don't know why people are attracted to it. I'm not.

What are the future plans of iPass? Any business ventures that you are getting into?
Our business is providing a platform. We're always looking at new ways to apply that same platform -- our corporate remote access is the most exciting area for us. We're going to have announcements for India this week.

We'll be connected with Microland -- it's a technology tie-up -- as service providers. It will be the first time that this product will be used outside the USA. We're positive it will be an exciting product because of the businesses here which are more dependent on email. This technology will give them quicker access at a lower cost.

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