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In cyberspace humankind is creating a new world. Telecommunications, computers, the Internet, and its vibrant offspring, E-commerce—all parts of the vaunted National Information Infrastructure, NII—are among the latest of a long line of information technologies that are changing the way people relate to one another, the ways they communicate, live, work, do business, and entertain themselves. Novelist William Gibson coined the term “cyberspace,” in Neuromancer, to describe the virtual, digital world these technologies have made possible. He also sought to distinguish this new electronic bit realm from a physical world characterized by atoms and more traditional relationships [].

The main purpose of this chapter is to offer an overview of status seeking in online entertainment communities (OECs) and design issues associated with status seeking. refers to one’s standing in a social hierarchy as determined by respect, deference, and social influence (). The value of status is demonstrated in the behavior among participants of OECs. Status seeking is a particularly strong motivating force used by entertainment providers to promote the usage of online entertainment. It is therefore interesting to study the implications of status seeking for the design of OECs. In this chapter, we lay out the theoretical and empirical foundation for status seeking in OECs and provide a game-theoretic framework for analyzing it. We discuss a handful of design issues associated with status seeking in the context of OECs. We also identify several open issues for future research.

Business information services are intermediaries that collect, collate, package and distribute information of value to professional users. We consider two technologies that such intermediaries may use for delivering information. First, a packaged design that uses physical media like CD-ROMs to distribute information. Second, an online service that delivers such information via the Internet or other online networks. We model a market where subscribers may choose between “self-service”, where they collect and collate information directly from sources, and a third party service provider who provides either a packaged design or an online service. Subscribers are indexed by their volume of usage for the service. In a duopoly, we show that providers with online or package technologies will serve different market segments. The package provider’s limited ability to provide current information, combined with decreasing search costs in an online service will make a package provider increasingly vulnerable to being driven out of the market by the online provider.

Information and banking technology have combined to throw the retail banking business model into disarray. Many predicted that lower cost online-oriented services such as Citibank’s Citi f/i venture would dominate the retail banking market and drive out high cost old technologies. The subsequent failure of Citi f/i and other virtual banks raises questions about how technology choice affects retail banking competition: Under what conditions would an online-only banking strategy be successful? When can a bank deploy both old and new technologies and still be competitive? Can an ATM network substitute for a branch network? Do customers’ attitudes about technology affect banking strategy? We use an economic model of a competitive retail banking market to address those and other questions. Our model allows banks to choose their technology, including establishing separate branch and ATM networks or relying on third party ATM networks. We also include customers that have differing attitudes toward technology. Our analysis suggests that customer preferences, rather than technology cost structure, drive the evolution of banks’ strategic technology choices. Also, banks in our model tend to deploy ATMs in the same numbers as branches, despite ATM’s cost advantages. Finally we show that virtual banks will remain unprofitable until a much larger proportion of the population is comfortable with online bank transaction technology. These results suggest that banks should carefully study their customers’ preferences to align major strategy shifts with customer attitudes.

The web-based buying process requires the buyer to navigate through a series of web pages. Moreover, the web pages for a particular buyer can be customized based on his general profile and previous purchasing behavior. Hence, as compared to a traditional retailer, the e-retailer (who sells products directly to customers through the Internet) is able to exercise a much greater influence over the demand level for its products. This allows an e-retailer to proactively dampen the demand for a niche product and guide the customers to generic substitutes when the on-hand inventory level is low relative to the sales rate. Use of (PDM) can reduce inventory related costs and improve the overall profits.

In this paper, we develop a model for e-retailers exercising PDM by adjusting the display prominence of a product to control its supply chain inventory. The demand realized for the product is deterministic but dependant on the level of prominence with which the product is displayed on the web pages. The model considers two levels of prominence for the product’s display. When the product is displayed prominently, all the potential demand is captured. When the product is displayed less prominently, part of the demand for the product is guided to a generic product which has better economies of scale. The price of the product is fixed and there are standard inventory costs such as holding cost, penalty cost and ordering cost. The objective is to maximize the long-run average profits per year. We derive closed form equations for the optimal parameter values for implementing PDM.

A numerical analysis is performed to estimate the benefits of PDM. The numerical analysis reveals that PDM can increase profits by as much as 12%. PDM is more beneficial when a larger proportion of the potential demand for the product can be guided to a generic substitute. PDM is a beneficial strategy to adopt when the inventory related costs per unit of demand are significant compared to the profit margin.

The Business and Information Technologies (BIT) project at UCLA includes a survey aimed at providing a base line study of the impact of technology on business practice. The study documents the information technology driven changes that are occurring across a wide spectrum of industry sectors in the United States and Canada. Changes in the nature of the workplace, B2C relationships, the structure of business processes in terms of B2B relationships, technology adoption and globalization are observed. The results indicate that businesses are changing internally as well as in terms of their interactions with their customers and trading partners. As might be expected, the rate of change is perhaps not as rapid as might be suggested by the “high water mark” e are described in the popular business press. However, the changes are without question both pervasive and on-going.

The Internet phenomenon was primarily a matter of a fundamental change in information logistics, with the protocols of the web superimposed on a deregulating and increasingly competitive telecommunications environment. It is expected that all the technological and infrastructure developments will change the structure of firms in terms of organization and work process, will change information chains and inter-organizational relationships, and alter the structure of industrial sectors, to the point that the traditional categories do not apply very well.

Implementation of new digital technologies in Italian firms has not been as rapid as might have been expected, even though they have started to change the way in which businesses are organized. After the disillusionment that followed the euphoria of the nineties, many firms have postponed their e-business investments as they look for more certain answers to their questions. We tried to find at least some of these answers in this study of the development of e-business in Italy by meta-analyzing relevant research studies (including the results of 16 case analyses developed at SDA Bocconi by colleagues working in different management disciplines), and by interviewing 56 e-business managers in firms of different sizes operating in various industries. The results of the study indicate that digital technologies and e-business have already changed the nature and organization of businesses, but perhaps in a different way from that originally expected. The use and impact of BtoC e-commerce is limited. Instead firms have mainly used digital networking technologies in order to reorganise their internal processes and relationships in the supply chain. The role of culture and of intangible resources has proved important.