Week Nine - Reflection on Learning

This week's topic was online auctions. It got us to think about the different types of auctions that are available and how they can assist in pricing, also known as 'dynamic' or 'fluid' pricing. eBay is one of the more successful companies that has used this type of trading. However, it has not come without its issues. Due to numerous amounts of fraud associated with auctions, it has had to implement systems such as PayPal and online feedback to ensure buyers and sellers conduct business in an ethical manner.

Topic Nine - Online Auctions

1. eBay is one of the only major Internet "pure plays" to consistently make a profit from its inception. What is eBay's business model? Why has it been so successful?
eBay is a major auction service on the Web. It promoted the theory of buying and selling online, and both individuals and commercial enterprises list items for sale. There is no charge to browse the site or make bids and purchases, but there is a fee to list items. If an item is purchased, the seller pays eBay an added fee. Numerous items are offered, and billions of dollars’ worth of merchandise is sold every year through this service.

eBay follows the brokerage business model where it links buyers with sellers, or vice versa. Its success is based on its ability to transform many small markets into one large global market at a small cost to its users. In the past, people have bought and sold used and collectible items through garage sales, classified advertising in local newspapers, and flea markets. However, the number of people available to complete a transaction was limited because a face-to-face meeting was typically required.

2. Other major web sites, like Amazon.com and Yahoo!, have entered the auction marketplace with far less success than eBay. How has eBay been able to maintain its dominant position?
eBay, Yahoo! and Amazon are all popular sites for online shopping as they provide consumers ample convenience. Amazon and Yahoo! operate similarly to regular stores and offers stocks of the products to consumers. They are required to offer some level of service and warranties to customers. In contrast, eBay is not an online store, it is an auction house and it does not actually sell anything. eBay is a site where people go to buy and sell their stuff.

The reason why eBay is so successful is because it facilitates the transaction between buyers and sellers. With eBay, you are basically dealing with another person and not the site itself. In case your transaction goes awry, eBay is not legally bound to compensate you. eBay does not control the price or quantity sold. It leaves it up to the forces of supply and demand in order to reach equilibrium.

http://www.differencebetween.net/technology/internet/difference-between-ebay-and-amazon/)

3. What method does eBay use to reduce the potential for fraud among traders on its site? What kinds of fraud, if any, are eBay users most susceptible?
The methods that eBay used to reduce the potential for fraud among traders are that it never asks for personal, identifying information in an email. In addition, eBay has a feedback system that enables consumers to give a positive, negative or neutral rating, along with a short comment. This information is available in each member's Feedback Profile, and helps prospective trading partners buy and sell with confidence.

The main types of fraud that eBay is susceptible to are:
• Unwarranted returns: Occurs when an item is purchased, used and attempted to be returned for a refund after the buyer has tampered with it.
• Service blackmail: This occurs when a buyer uses some kind of power to obtain better pricing, additional goods or accessories, or enhanced service from a seller.
• Payment fraud: The most common types of payment fraud are credit card fraud and PayPal payments made with stolen accounts, both of which can leave the seller holding the bag. Also common are bad checks or bad money orders.
• Auction tampering: Occurs when a buyer bids for an item with no intention of ever paying for it.

(http://ebay.about.com/od/resolvingdispute1/a/rd_buyerfraud.htm)

4. eBay makes every effort to conceptualize its users as a community (as opposed to, say "customers" or "clients"). What is the purpose of this conceptual twist and does eBay gain something by doing it?
eBay sees its customer base as a community as it believes that everyone is a unique individual and has something to contribute. By allowing customers to contribute to all aspects of its planning and decisions, it has made the company an evangelism marketing pioneer. Customers feel valued which builds their loyalty to the company.

5. eBay has long been a marketplace for used goods and collectibles. Today, it is increasingly a place where major businesses come to auction their wares. Why would a brand name vendor set-up shop on eBay?
As the Internet is becoming more prominent compared to bricks-and-mortar stores, an increasing number of businesses are utilising eBay as another avenue to sell their wares. The reasons for this are due to the convenience of online shopping, and the ability for the market to set the price. Setting prices can be difficult to establish, especially in regards to new product releases. If prices are set too high then inventories increase. But setting the price too low creates product shortages and lost revenue. Setting up shops on eBay increases brand presence, which also can result in increased brand loyalty as customers can provide feedback if they are satisfied with a product.

6. I have a few businesses, and I have used eBay for about 12 years on and off. Currently I have about 600 books listed on eBay (seller name ozrural). I stopped selling on eBay for a few years but they changed the rules this July and it is viable again (for me). What do you think changed?
According to eBay.com.au, the change that eBay made from 14 July 2010 was new accepted safer payment options for sellers. The revised policy requires sellers to offer one or more of the following three safer payment methods to buyers: PayPal, Paymate or Merchant credit card. The change provides both sellers and buyers increased choice among safer payment options. In addition, increasing the number of accepted payment methods also helps eBay develop an enhanced checkout experience in line with industry best practice.

Week Eight - Reflection on Learning

I thought aspects of this week's topic, Digital Automata, were quite amusing! I absolutely loved the cybertwin and the random responses that it gave me. For example, I typed in the 'winking' emoticon and the cybertwin's response was: "Do you have a pin in your eye?"

I found the Turing Test to be an interesting experiment, as well as the Chinese Room objection. I can see both sides of the argument, although I'd like to think that computers will eventually develop human-like thinking - even if it does gather its information from a variety of sources first. That's how humans learn also!

Topic Eight - Introduction to Digital Automata

1. Check out the link to my ‘intelligent’ cybertwin. Imagine if we had a cybertwin that could answer your questions about the course?
I thought that chatting to the cybertwin was bizarre! At the start I thought it was Ian playing a joke! I think that technology has progressed so quickly and much further than we could have ever imagined. It is difficult to keep up! It would be great to have a cybertwin able to answer questions about this course. It would save a lot of time and effort researching and trawling through the Internet and other resources.

2. Write a one paragraph describing the Turing Test and another paragraph describing an argument against the Turing Test, known as the Chinese Room.
According to Webpedia.com, the Turing Test is a test that was devised by the English mathematician Alan M. Turing to determine whether or not a computer can be said to think like a human brain. In an attempt to cut through the philosophical debate about how to define "thinking," Turing devised a subjective test to answer the question, "Can machines think?" and reasoned that if a computer acts, reacts and interacts like a responsive being, then call it responsive. The test is simple: a human interrogator is isolated and given the task of differentiating between a human and a computer based on their replies to questions that the interrogator poses. After a series of tests are performed, the interrogator attempts to determine which subject is human and which is an artificial intelligence. The computer's success at thinking can be measured by its probability of being misidentified as the human subject.

An argument against the Turing Test is in reference to the Chinese Room. The Chinese Room objection suggests that machine thought is not possible. Although a computer may be able to pass the Turing Test, a man may also be able to do the same thing without fully understanding the content. For example, he is given a book telling him how to respond to the different Chinese symbols and therefore is able to write the appropriate responses. The man may not understand Chinese, but, it is argued, he is doing the same thing that the computer is and thus the computer doesn't understand Chinese.

3. With reference to the video 'Creativity: The Mind, Machines and Mathematics: Public Debate' consider the following question - can virtual agents succeed in delivering high-quality customer service over the Web? Think of examples which support or disprove the question or just offer an opinion based on your personal experience.
Virtual agents interact with programs with some degree of understanding of what the user’s goals and desires are in completing a particular task. I believe, to a certain extent, that virtual agents are able to succeed in delivering ‘satisfactory’ customer service in that they will be able to answer the basic or common customer queries. The more complex queries, however, would be better suited to real life customer service representatives. For instance, a problem may have a number of different expressions in terms of how the question is asked and when a question is asked, and therefore may not get the appropriate automated response.

Companies such as Google have agents which when a user types in a word or question into the search engine the agent gives a reply with similar websites relating. Depending on the word or question that is requested, the search results are not always satisfactory. For example, I was searching for some advice on how to recover after having wisdom teeth removed. To my horror, I got a list of links that lead me to responses made by people stating how painful the actual process was! That was not my initial question, and certainly not what I wanted to read five days prior to surgery!

Week Seven - Mid Semester Exam

This week there was no topic set as we had our mid semester exam. Although the exam was challenging in parts, it was highly beneficial as it reinforced everything that we have learned so far and tested our research skills. Hopefully my research has paid off! All the best to students in completing a successful exam.

Week Six - Reflection on Learning

This week we were encouraged to think about various questions in relation to digital markets, including what impact is digital technology having on prices? Do we see lower prices or higher prices? How does it change the variation in prices? Do we see lower variation? Do sellers start to converge on a particular price? Or do we see a wide variation from high to low in prices? What’s the variability in terms of demand, potentially? Do changes in demand have a significant change in price? That is, are prices elastic or are they inelastic? Does price transparency increase? Are we more aware of the range of prices in the marketplace? Or are prices becoming less transparent? To what extent are prices known?

As demonstrated above, there are numerous questions to consider about digital markets. What we might have assumed initially, such as low entry barriers, actually are different. Different kinds of products and services are going to experience different market dynamics because of digital technologies, and the history of the last decade is going to have some influence in terms of where we are today and where we’re heading into the future.

I really enjoyed this week's topic, and it certainly change my perception on how I viewed the world of online enterprises. I especially found 'The Long Tail' theory interesting.