INSY 440: E-Business, My Experience

Over the past 14 weeks, I have had the privilege to learn about the E-Business at McGill University. We went through a variety of different material that touched upon the actual definitions of E-Business, Performance indicators, Data, Cloud Computing, and the list goes on.

But I feel that along with the technical knowledge I have gained, I've been able to gain a much broader knowledge of the overall world of E-Business, and how it will affect me as a consumer. We learned that more and more businesses have been moving their operations online because of the economic benefits associated with that. Especially since as consumers, we seem to value convenience over privacy, which gives the perfect environment for these new E-Business shops to thrive.


However, this prosperity is not without its risks. I learned that online security and privacy are definitely major concerns for E-Businesses. Although not electronic, Target serves as a prime example of what would happen when a company does not properly secure its information. As I were to start an E-Business, I would for sure be weary of these sort of things.


Overall, it has been an interesting and rewarding experience learning about E-Business. I began my journey 13 weeks ago as the Aspiring Technologists. Although there is still a long way to go, I feel that I’ve had quite a good start.

Along with my learnings of E-Business, I also had the opportunity to apply my knowledge in an actual business case. Looking at the online community Patients Like Me, our team was able to work together to apply our E-Business knowledge to help the company improve its operations.

The End of Windows XP

So there has been speculation that Microsoft will be ending all support to its Windows XP operating system users. The final date has finally been announced for April 8, 2014.

Although users still have the rights to use it, there are scary implications to not having support. One of the main advantages of COTS (Commercial off the shelf) software is that there is a strong support network. With that gone, users will soon to be more exposed to the potential of new bugs and eager hackers waiting to take advantage of new security flaws.

In a report by Bell Media, roughly 30% of Canadians still use the Windows XP operating system. With that figure, it's not surprising to imagine hackers getting ready to reap the opportunities with this soon to be weakened operating system. This of course will lead to many upgrades to Windows 7 and Windows 8, which well undoubtedly benefit Microsoft.

One final mystery we need to realize now is the impact this decision will have on banks. Banks in Canada all run on Windows XP software. With no signs of transitioning out of it, it can be imagined that Microsoft will continue to offer support for those systems. But the question really is when Microsoft will also end support there, and thus forcing all banks to switch over as well. Microsoft is the clear winner in any of these outcomes.

With Windows XP almost at the end of its life, below is a video paying homage to some of Microsoft's other fallen operating systems. Enjoy!

Facebook on an Acquisition Spree!

So it's common knowledge among us aspiring technologists that Facebook has been sitting on a ton of cash since its initial public offering (IPO) in 2012. Since then, Facebook opted to obtain growth through M&A decisions, along with its organic growth, through acquisition of Instagram, WhatsApp, and now Oculus VR.

So what is Oculus VR? Oculus VR is a maker of Oculus Rift virtual reality gaming hardware, originally funded through Kickstarter. Reportedly, Facebook will pay around $2 Billion USD for the company. Just like Whatsapp, Facebook is planning to let this start-up continue to operate as is.

This is just another attempt it seems for Facebook to acquire companies relatively related to their industry, which helps create a stronger, more integrated ecosystem. As Facebook's primary source of revenue is still through ads, it will be interesting to see how Facebook is planning to actually monetize it's new acquisitions. More to come...

Here is a clip of the Oculus Rift Development Kit 

Will Amazon move away from E-Commerce?

E-Commerce giant, Amazon.com announced that it will increase the price of its premium subscription service, Amazon Prime, from $79 per year to $99 per year as of April 17, 2014. According to Catherine Clifford of Entrepreneur.com, Amazon's CFO stated that the company's hand was forced due to the increasing cost of transportation and increases in orders.

With Amazon posting negative earnings in 2 out of 3 of the previous quarters, this increase in price is appealing to shareholders. As the leader in E-Commerce, it seems that even Amazon.com has its own challenges.

Although bold, I predict with Amazon's increased focused in cloud services, Amazon will probably move out of E-Commerce all together. Currently, Amazon's cloud services is its most profitable division. In addition, with Wal-Mart planning to expand into E-Commerce, there might be a legitimate threat to Amazon.

Given an increased trend in consolidation in the North American market, it would not be surprising to see an acquisition by Wal-Mart for Amazon's E-Commerce division. In 25 years, I believe Amazon.com will fully be on the cloud.

How Google`s Freeware has potential to erode Microsoft`s Office 365

On March 11th, 2014, Google introduced the concept of add-ons for Google Docs and Google Sheets. With Google Docs and Google sheets already acting as free, comparable substitutes for COTS software, having these add-ons adds a unique value proposition.

Prior to this introduction, the main benefits of COTS software, like Office 365, included both security and functionality. However, with these add-ons, more and more functionalities are being added to the existing freeware. Examples include:

HelloFax - which allows for users to send their documents easily VIA fax (for those who still do that)

Easy Bib - which allows for users to easily create bibliographies for their cited work as an integrated part of the overall document 

UberConference - which allows for users to add conference calls to all Google Docs, making it very attractive for team exercises 

Similar to the App Store and Android Market, Google has implemented the Chrome Web Store, which allows for developers to create any applications under their platform at their own discretion. Because of this, it opens up a variety of different possibilities that could affect the user experience for Google Docs and Google Sheets in the near future. This poses a huge threat to the market leader, Microsoft, with its costly and now perhaps, less customizable software.

It will be interesting to see how Microsoft will react in the comings months to this strategic move by Google. Will Google's take on customization change the way in which we word process and make spreadsheets? We'll just have to see.

Video for Add-Ons

Apple, not as safe as we may have thought

Amongst most consumers, the general consensus regarding Apple products is that they are more secure and less "hack-able" than other brands. Although Apple is known for creating user friendly interfaces and less redundant code, it can be agreed amongst us technologists that there is nothing special about Apple that actually keeps it safe from hackers.

The main reason why we don’t see a lot hacking amongst Apple products is because it’s simply more popular to go with other platforms such as PC. In a previous blog post, we touched upon how Windows (both XP and 7) made up of over 70% market share for operating systems (excluding mobile devices). Therefore from a hacker perspective, it is much more enticing to create a malicious virus that can be applied to 70% of the world, rather than the other 30% made up of Apple, Linux, and other operating systems.

Recently, it was announced that Apple had released a new patch for both its mobile and Mac operating systems because of a critical security flaw. Quoting an Apple spokesmen, "Impact: an attacker with a privileged network position may capture or modify data in sessions protected by SSL/TLS and modify data”. This basically translates into a hacker having the ability to impersonate a protected site such as a banking website to steal valuable information.

This is just one example on how the general view of the consumer is wrong. The customer is NOT always right. Apple products can also have bugs just like any other products. The only difference is that since the market has not deemed Apple the market leader, it does not garner the same attention. 

Video Explaining the Fix of Apple's Security Flaw

Facebook's Horizontal Integration: Buys WhatsApp for $19 Billion

So by now, a lot of you probably know about Facebook's announcement to acquire WhatsApp, a cross platform messaging application, for $19 Billion. This has been one of many acquisitions by Facebook since its initial IPO in 2012 as the social networking giant is attempting to diversify amongst social networking platforms as a whole. 

So the question is... How does WhatsApp add value to Facebook?

Coming from a Finance perspective, the only 2 reasons to acquire another company is 1) to restructure it and sell it at a HIGHER price, or 2) because the company offers synergy, which is defined as the added value of having business units working together. 

For Facebook, it is clear that the motivation is based off of the latter. This acquisition is known as horizontal integration, which is the process in which a company acquires related companies on the same level, ie: messaging services. 


Summarizing the Financial Post, the main motivations are as followed:

1. WhatsApp has more than 450 million monthly average users, 70% of which are active on a given day.
2. WhatsApp now handles more than 19 billion messages per day, a figure that is approaching the text message (SMS) volume of the worldwide telecom industry, which is a US$100-billion market.
3. WhatsApp uses internet connectivity rather than a phone network to offer low-cost messaging, costs just $1 (after the first free year) and the company has spent nothing on user acquisition to date.
4. WhatsApp can Facebook strengthen its footprint in international markets and with teens. 

With this acquisition, Facebook believes it now has a significant opportunity to be the leading global communications utility along with its already popular Messaging Services. 

Market Share of Technology

Today's world of technology is a highly competitive landscape. Consumers now have a choice of many different companies that each offer a unique type of service. Within each domain, there is a winner. Below, I will be discussing the market share leaders for Internet Browsers, Mobile Vendors, Operating Systems (non-mobile), and Mobile Operating System based on both internet and referral traffic tracked by Statcounter.

For some of you, these findings may be a surprise. For some of you, perhaps not. Let's begin!

Browser Market Share

With Google Chrome's launch in 2008, it has rapidly become the most popular browser used for non-mobile devices. Given its sleek design, unique features, such as incognito mode, and its in-browser applications, it is no surprise that Chrome has been able to capture market share from many of its competitors. While Mozilla Firefox, Apple's Safari, and Opera have remained relatively constant in market share, Microsoft's Internet Explorer has taken the biggest over the past couple of years.

Mobile Vendor Market Share

The Mobile Vendor playing field has indeed been the intense. As of January 2012, prior to Nokia's acquisition by Microsoft, the battle for market share between Nokia, Samsung, and Apple was separated by only a few percentage points. In my opinion, consumers in the developed world often disregard brands such as Nokia as it may not produce a product that directly pertains to them. However, given that the vast majority of the world is still developing, it should not be surprising to see the low cost alternative of Nokia to be appealing. 

Operating System (non-mobile) Market Share

Very similar to the Nokia situation, some may be surprised to see how dominant Microsoft OS actually is. Given that most college auditoriums are flooded by a sea of Macs, we see that in actuality, Windows is still the standard. What is interesting is to see how relevant Windows XP is, given it was released back in 2001. However, Microsoft recently announced that it would soon cease support on the XP OS, which may tempt current users to switch.

Mobile Operating System Market Share

Android OS and iOS are currently the two most popular mobile operating systems, accounting for 2/3 of all mobile devices. It is interesting to note that although Android is the market leader, Apple is the leader in the US and the UK. This again sheds light on the socio-economic limitations individuals have on the choice of their products. Given that Apple's iPhone is generally more expensive, the proportion of individuals in developing countries who cannot afford Apple's products is apparent. 

Overall, we are able to get a glimpse of the heavily competitive landscape that is Technology. We can see that although some companies are dominant in some countries, it does not mean it can retain the same dominance in other countries. Although globalization is apparent, it seems that technology vendors are not forgetting to cater directly to its customers, but who knows what the profile of these customers will be in 5 years? 10 years? 25 years? We'll just have to wait.

*Infographics obtained from KISSmetrics

Password Security for E-Commerce Sites

Last week, I wrote about key trends arising in E-Commerce and how those trends are making the digital playing field very attractive to vendors and consumers. However, there are disadvantages of E-Commerce. For example for consumers, there is an issue for online security.

In a study conducted by DashLane, they found that 64% of the top 100 US E-retailers have "highly questionable password policies, resulting in poor security of their users' personal data". A detailed report of DashLane's methodology for this study can be accessed here.

DashLane's Info Graphic on Data Security

With this lack of security enforced by retailers, it puts consumers in a situation in which their personal data can be jeopardized and puts light towards the hot topic of internet security, which has been here since the beginning of the internet.

Some savvy consumers often come up with elaborate passwords that they believe will protect them from hackers, regardless of what E-retailers are trying to enforce. However, hackers are smart.

According to Melanie Pinola of LifeHacker.com, "Our passwords are much less secure than they were just a few years ago, thanks to faster hardware and new techniques used by password crackers" .

In addition, making matters worse, "hackers know a lot more about our passwords than they used to. All the recent password leaks have helped hackers identify the patterns we use when creating passwords, so hackers can now use rules and algorithms to crack passwords more quickly than they could through simple common-word attacks."

This spells bad news as not only are websites not taking the necessary precautions to guide users in creating strong passwords, what we perceive to be strong passwords might not be strong enough. 

So the million (or billion) dollar question is.... "HOW DO WE PROTECT OURSELVES ONLINE?!?"

A few tips from Life Hacker suggests:
1. Avoid predictable password patterns

2. Use Truly RANDOM passwords
3. Use unique passwords for each site

Once the necessary precautions are taken, regardless of what E-Commerce sites enforce, we can continue to enjoy the convenience of E-Commerce with a sense of security regarding our personal data. 

Top E-Commerce Trends Explained

As you all know, E-Commerce has had a rapid uprising over the past decade with the likes of E-Bay, Amazon.com, and other large retailers leading the way. With that, Hazel Raoult of UsabilityGeek has researched the Top 5 E-Commerce Trends for 2013.

Below, I will touch upon 3 topics that Hazel talked about while adding my own perspective to why I believe these trends are rising.

1. Localization of e-commerce websites

Given the diverse cultures and economies across the world, it is clear that catering products and services to that of the locals is a viable strategy that has been used for decades. That is why you see the likes of Poutine at McDonalds in Canada, or the Chinese version of MS Office in East Asia. Therefore, it is only natural to see catering into the e-commerce world as well, with the increasing technological capabilities we have developed. 

2. Mobile Commerce
One of the biggest problems for online shoppers is that they are usually unable to test or physically see a product before purchasing it. Usually, the website interface involves a description, a picture, and payment information, which is often not enough to allow a buyer to make an informed decision. Now, E-Commerce sites are realizing this problem and are leveraging technology to create interactive product displays that give the customer a greater understanding and feel for the product. Sites such as Ikea allow you to create your own virtual room to really see how their furniture will look like in a real-world setting, to further entice their customers to purchase their products.

3. Interactive Product Display over Images

The amount of mobile phones in the US has drastically increased over the last decade, in which over 51% of Americans had smart phones as of 2013. Given the multi-faceted nature of the smart phone, that combines talk, text, video, music, entertainment, games, mobile banking, shopping, and YOU NAME IT, into one compact device, it is clear to see why more and more retail stores are leaning on a mobile application to further drive sales. Prominent mobile applications include that of Starbucks, Target, and Home Depot. 

Overall, these are just 3 of many E-Commerce trends that are rocketing this industry into the future! 

Netflix: Another Example of Successful Technology

Just today, Netflix shares (NYSE: NFLX) jumped up 16% to reach $385.62 after a favourable earnings announcement. This represents one of many indicators of the success this video streaming giant has achieved over the past year. In 2013, Netflix was able to gross over $4,000,000,000 ($4 billion has a lot of zeroes) in revenue through its streaming services alone. This 16% increase marks the largest gain in the S&P 500 index (SPX: IND) over the past year.

Looking back just a few decades ago, companies such as General Motors and GE were applauded for their ability to produce high quality, tangible products. These blue-chip companies represented the forefront of business and what companies then strived to achieve.

Now into the 21th century, technology has made it so less and less companies need their products/services to be tangible, in order to provide value. The service that Netflix provides, like many other tech companies, is sourced essentially from computer code made up of 0s and 1s, all powered by hardware and electricity. As of 2014, three out of ten of the the top 10 companies in the world by market capitalization was made up of technology stocks (Apple, IBM, and Microsoft). In the US stock market, Technology stocks now represented the 2nd largest sector by market capitalization, just under Consumer Goods; decades ago, this would have never happened. 

Even looking at just the video service-provider industry, we all saw first hand how technological innovation into virtual streaming was able to destroy the classic video store model... which led to the loss of our good friend, Blockbuster in 2010.

Netflix is just yet another example of how we are in the a new era of modern technology, and demonstrating how virtual and intangible ways of business can add tremendous value to our lives, as well as our wallets. 

So with all that in mind, I leave to you all a few questions:

Do you think technology will ever become the largest market sector? Where do you see Netflix going in the future? How can blue-chip companies innovate to survive?

Introduction to the Aspiring Technologist

Hello Internet!

My name is Patrick Zeng. I am a graduating student from McGill University with a major in Finance and concentrations in accounting and information systems.

All throughout my university career, I thought I would end up in the world of Finance. From watching finance movies such as Too Big to Fail or the Wolf of Wall Street (well done, Leo) .... 

.... to working my first internship at a start-up appeasing VCs and focusing on capital budgeting, I was thrilled by the ever-changing environment Finance had to offer.

As I continued to pursue a life of Finance, I was exposed more and more to technology. Through using trading platforms such as Bloomberg to learning about the history of technology in general, I realized early that technology was a key driver for everything we have in the modern world. As an avid problem solver, I could see that technology was a viable solution to solve MANY of the problems we currently have in the world today (which I will discuss later on). In addition, just like in Finance, technology was constantly changing, and offered a thrilling experience that fueled my curiosity.

With my interest in technology growing, I decided to embark on a journey to learn what drives innovation and technology and see the impacts it has in the business world, as well as how we live our everyday lives.

As the Aspiring Technologist, here is where I will be discussing my thoughts on HOW and WHY technology changes our world, in addition to shedding light on interesting trends that I have seen. Hopefully through this journey, I will be able to continue my growth as a technologist and learn to leverage it not only in Finance, but also to better the world.

Thank you for following, and stay tuned for more posts to come!