Business models:

Question 1

Brokerage

A brokerage business model is one where the broker’s role is to allow buyers and sellers to meet and transact. This business model will allow both parties to get what they want with some ease and in return, they will charge a commission which is called a brokerage fee. In the e-business world, the various type of brokerage model that exists includes marketplace exchange, buy/sell fulfillment, demand collection system, auction broker, transaction broker, distributor search agent and/or virtual marketplace. A very good example of a real world brokerage model is Betfair 365 which allows gamblers to bet or lay bets.

Advertising

The advertising model is one where businesses advertise on some website to target a maximum number of customers who use those websites. The website thus generates revenue by charging fees to these businesses who advertise. The advertising normally takes place as banner ads or pop-ups that accompany some website. These advertising will aim to reach the maximum number of potential clients and thus will be more common on very popular websites that have high traffic. Real world examples include Google or yahoo.

Infomediary

Data about consumers and their consumption habits are valuable, especially when that information is carefully analyzed and used to target marketing campaigns. Independently collected data about producers and their products are useful to consumers when considering a purchase. Some firms function as infomediaries (information intermediaries) assisting buyers and/or sellers understand a given market. These websites attempt to get customers to subscribe and give information about their tastes and preferences and later on will have matching advertisement. A good example is scribd.com.

Merchant

The merchant model relates to websites that are involved in the wholesaling and retailing business selling to the customers directly. Therefore, in the e-business context, this relates to websites that serve the only purpose of selling goods and services directly to the customer. An example includes the site a1supplement.com.au.



Manufacturer (Direct)

This business model is one that allows the manufacturer to sell its products directly to customers, therefore bypassing all middlemen in the process. This website allows for substantial cost reduction for both buyers and sellers. A good example is Dell computers.

Affiliate

The affiliate model provides purchase opportunities wherever people may be surfing. It does this by offering financial incentives (in the form of a percentage of revenue) to affiliated partner sites. The affiliates provide purchase-point click-through to the merchant. It is a pay-for-performance model -- if an affiliate does not generate sales, it represents no cost to the merchant. The affiliate model is inherently well-suited to the web, which explains its popularity. Variations include banner exchange, pay-per-click, and revenue sharing programs. Example of such a website is Amazon.com.

Community

The viability of the community model is based on user loyalty. Users have a high investment in both time and emotion. Revenue can be based on the sale of ancillary products and services or voluntary contributions; or revenue may be tied to contextual advertising and subscriptions for premium services. This model is nowadays very popular with websites such as facebook which has networks from all kind of communities who get together. In the meantime, businesses seize the opportunity to advertise and boost their sales on such platforms.

Subscription

The subscription model is one where the customers join the website by paying subscription in order to use the content of the website. Real world examples of such websites include many electronic academic research websites or download websites such as rapidshare.com.

Utility

The utility method is one business model that generates its funds from the client’s usage of the website. It is just like a utility (water, gas, electricity or internet) company would charge a customer. A good example of such website would be those that offer pay per view of sports coverage.

Question 2

What is the business model for TWITTER?

Twitter is a global social network that gathers millions of people around the globe and allows them to interact with each other. This website is so popular that it has been a platform for its inventors to make lots of money due to the amount of potential customers that are on the website each day. This is why the site can fit several business models at the same time; however the business model that stands out for Twitter is the advertising model. Being a website that gathers so many potential customers, Twitter is an immense marketing platform for any business and thus advertising on Twitter is worth paying for. This is how Twitter generates a major part of its revenue.

Question 3:

1) What is the Mobile phone use /100 population - compare Australia, USA, China, India, Your Country

USA: 86.79/100
Australia: 104.96/100
China: 47.95/100
India: 29.36/100
Saudi Arabia: 142.85/100
2) Internet use / 100 population - compare Australia, USA, China, India, Your Country

USA: 74/100
Australia: 71.98/100
China: 22.28/100
India: 4.38/100
Saudi Arabia: 30.8/100


3) Compare main strengths and weaknesses of Australia or your home country in the survey

The strengths of Australia include:

Level of competition, e-Participation, time required to start a business, number of procedures required to start a business, effectiveness of law-making bodies, secure internet servers (hard data), government online service index (hard data), laws relating to ICT, venture capital availability

The strengths of Saudi Arabia include:

Level of competition, computer, total tax rate, education expenditure, and time required to start a business

The weaknesses of Australia include:

Business monthly telephone subscription, total tax rate, fixed telephone tariffs, mobile cellular tariffs, residential monthly telephone subscription, extent and effect of taxation, burden of government regulation, availability of new telephone line, high tech exports, computers.

The weaknesses of Saudi Arabia include:

High-tech exports, freedom of the press, e-participation index, time to enforce a contract, number of procedures to enforce a contract


4) What does the survey suggest to you about the Information Technology readiness of Australian business compared to Australian consumers?

According the survey, Australia’s business readiness is 21st globally. In contrast, the individual’s readiness is ranked in 31st place, meaning that in comparison to other countries Australia’s businesses are more technologically ready than the customers. This would be good news if the country is to move towards computerizing its economy.