Diffusion of the Mobile Commerce in Dubai - Research Paper Example

 Diffusion of the Mobile Commerce in Dubai Introduction and Context This study is an effort to analyse how the developments in information technology have led to the proliferation of mobile communication and consequently the value added services being provided by the mobile communication companies. Dubai has always been a city taking cues from the developed world as far as adopting latest technology is concerned. Being the largest city in UAE, Dubai has always set an example for other Middle East nations in taking up newer initiatives. With a dependable mobile communication network and a high level of mobile communication penetration, it will be interesting to know the kind of value added services are on offer in Dubai. As internet is gradually maturing and presenting a paradigm shift in its very ideation, the technology infrastructure too is acquiring a business character, a transcontinental personality and a vending framework of wide-ranging, business, educational, scientific and personal data. Now the use of internet covers real-time computer conferencing, audio broadcasting, video broadcasting, real time telephony and of course real-time business. Mobile banking and mobile commerce are the relatively newer additions to the list of activities possible with the diffusion of mobile communication and internet technologies. Over the years IT has led to revolutionizing the way business is conducted, education is imparted, we communicate, we socialize, illness is cured etc. IT has made its mark in almost all spheres of life. E-commerce and M-commerce are the trendy application of this IT era. Now a company or business entity has plenty of avenues to reach to the customer. Business on the move is the latest addition. Dubai is being promoted as an attractive tourist destination and as a business centre. Dubai is therefore an attractive market for multinational enterprises. So there is an increasing emphasis on strengthening the communication networks, which provides an opportunity for indulging in reliable m-commerce activities. MEED1 (2009) in a recent report that Dubai First and Du have launched region's first pilot programme for NFC-based mobile payments using near field communication technologies like RFID, infrared etc. Mobile telecommunication, wireless networking and IT proliferation has grown dramatically over the last decade. These technologies, considered niche technologies and ancillary to the mainline industries till some time back, have now acquired the status of an industry itself. With the onset of convergence era the difference between personal computers, mobile phones, PDAs, etc. is disappearing fast. Initially there were apprehensions about the security of the individual and his/her transactions on the net and phone, but now reliable encryption technologies have made such transaction safe enough to earn reasonable credibility. Impressive GDP growth, improvement in economic indicators, increasing income levels of an average Dubai citizen are some of the factors determining the consumer habits in Dubai. Over the years wireless technology has shown a marked improvement and the era of e-commerce is marked by cell phones connected to the Internet. M-commerce, the new avatar of e-commerce, works by conducting business transaction via a mobile device. This facilitates features like ubiquity, personalization, dissemination and flexibility. Marketing people are always on the lookout for an opportunity to reach out to the customer. Therefore they saw an opportunity in the increasing levels of mobility as well. Mobile gadgets have now become the devices to inform, educate, transact and interact with the consumer. Following and prospecting the consumer is the result of aggressive marketing. It is the delivery of targeted qualified business offers to the consumers’ private mobile equipment from company’s website or centrally located warehouse. The increasing number of mobile users is further encouraging the mobile phone companies to go for value-addition in their services. The traditional usage of a ‘phone’ has given way to services like WAP, GSM, GPRS etc. Personalization is now the buzzword in the m-commerce parlance. As a business, mobile commerce is also a complex process involving a chain of operations. This chain requires active involvement of the customers, merchants, banks, mobile network operators, and the regulatory bodies. Many banks and commercial establishments have already started providing the facilities to citizens in Dubai services like internet banking, mobile banking, mobile payments etc. This study is being undertaken to assess the level of penetration of mobile commerce activities in UAE in general and in Dubai in particular. An effort would also be made to assess its acceptance levels amongst the citizens and to compare the status of m-commerce activities with the prevailing situation in some other countries/ cities. Research Question What is the extent of m-commerce diffusion amongst the mobile phone users in Dubai? Aims and Objectives The study about m-commerce will try to seek answers to the following key objectives; To analyse the process of globalisation and how it has impacted the proliferation of mobile communication technologies Determine the extent of penetration the telecom revolution has been able to achieve in global context as well as in Dubai telecom scenario. To identify behavioral patterns of the respondents on how they respond to the introduction of mobile commerce and how the companies and users carry out the process of evaluation before entering into the fray. Use of technological acceptance model (TAM) can also be made to assess the behavioral patterns Determine the factors assisting the surge in mobile commerce activities and how different stakeholders are preparing themselves for the emerging scenario What kind of encouragement is being provided by the government and the trade/ industrial bodies to m-commerce? What kind of challenges might the m-commerce activities have to face in due course? Methodology The method of exploring a subject depends upon a number of factors like the impact of research on the general population, on industry, on environment or on the researcher. Though, this paper is being taken up as part of an academic exercise, but if carried out in a truthful manner, such a study will surely help in enriching the information and database about the mobile communication in general and mobile commerce in particular. Any discussion of methodology involves a debate over the pros and cons of quantitative analysis versus qualitative analysis. Both types of analysis require data and facts and figures, which can be gathered either through primary sources or secondary sources. This study intends to find out the recent trends in mobile commerce applications in Dubai, but for the study we need to analyse, to some extent at least, the journey of mobile communication technology in Dubai and how the respective governments have framed policies to encourage such technologies. Therefore, use of reliable secondary sources would yield the necessary information about the path taken by information technology. Moreover, use of secondary research allows for the analysis of a broad range of topics that can be thoroughly investigated and has proven to be credible. The research used in this discussion comes from several sources including books, government documents, reputed websites and scholarly journals. The research also relies upon documentary evidences. This type of research involves “systematic and objective location, evaluation, and synthesis of the evidence in order to establish facts and draw conclusions concerning different sets of events. In addition primary data will also be collected from the users, service providers and the policy makers. Some of the steps involved in the research are; Studying the development of mobile technology and transition towards the m-enabled community How UAE has been following the latest trends from around the world Analyse the functioning and implementation of some of the latest initiatives by the government and the concerned sectors Carry out a comprehensive look at the consumers in Dubai and how their living standards, individualism etc are affected by the m-commerce initiatives Gather primary data about the popularity and diffusion of mobile commerce in Dubai with the help of questionnaire/ survey Correlating the available information and analysing it with the help of tools like SPSS or MS-Excel to arrive at a deterministic conclusion. Practicalities Considering the nature of the dissertation, more time and resources would be involved in studying it comprehensively, which might not be possible for an academic study. Similarly, in order to make the study uniformly applicable we need to have proportionate representation from different sections of the society, which is certainly not possible for the study. Nonetheless my endeavour will be to make sure that I am able to collect and interpret the data as comprehensively as possible. Selecting the sample size for administering questionnaire is another area which requires a number of practical considerations. For example, if we need to collect data from 100 respondents, then we might need to administer the questionnaire to about 125 people, because some of the respondents might not be willing to participate in the research process owing to different reasons. It is very crucial that I must make the objectives of the study clear to the respondents at the very outset, so that they don’t feel any apprehension in responding to the questionnaire. Protecting the privacy of the respondent is equally important from the point of view of bringing confidence amongst the respondents. In the course of the collection of the data required by this study, the time constraints might make it difficult to follow through other possible investigations which may lead to a more in depth analysis. The administration of the research instrument might take several turns. The analysis and interpretation also might prove to be time-consuming in itself, because some of the information though requested, might not be forthcoming on account of the sensitive nature of the information. The telecom companies may not be forthcoming with the information due to the cut throat competition in the market amongst the rival companies. The telecom scene presents such a diverse scenario today that at times there appears to be an information overload. Technology is changing very fast with newer standards coming up sooner than expected. In fact the telecommunication scene is one of the fastest growing sectors today. Rapid advancements in IT and the convergence technologies have provided the all important trigger for this industry to gain newer heights. It might prove very difficult for the researcher to keep track of all such developments with clinical precision. In addition the researcher has to interact personally to the respondents which might also result in slightly biased population. Ethical Aspects The study requires participation of human subjects. Therefore, we need to be considerate about; i. The time at the disposal of the respondent ii. The privacy concerns of the respondent iii. Adopting an unbiased approach iv. Misuse of the data or research findings by any person or organisation in favour or against someone v. Acquiring informed consent of the respondent for being part of the research PART-II: Critique of a Previous Dissertation Critique of a research study carried out by ROBERTO LECCA on the subject ‘Diffusion of the Mobile Commerce: Analysis of the Italian Situation’ The study was carried out with an aim to find out the extent of mobile commerce evolution in Italy and how this value addition is providing an opportunity to the Italian youth to go for the mobile marketing. The study is broadly based on the analysis of case studies related to mobile commerce success stories together with the study of existing literature on the subject. The researcher has also tried to make a comparison between e-commerce and m-commerce, which makes the study quite interesting from the point of view of a student, trying to figure out the difference between the two. To widen the scope of the study, the researcher has made use of a number of books from reputed authors and publication houses. In fact books have been the principle sources of information for this study. This is one of the major shortcomings of the research, because with technology changing so fast and mobile commerce being one of the latest applications of the communication technology, there may not be many books with latest inputs. For this, the researcher must have relied more on primary sources and/or on newspapers and research journals. But the shortcomings seems to taken care of by using the official reports and databases of some of reputed organisations like ITU, OECD, EU and ministries of some governments during the research. Some of the previous published research papers on the related subjects have also been consulted to take cues on certain aspects of the research and carry forward the process. It is quite intriguing that the researcher preferred to go ahead with the hypothesis that mobile phone is a tool which enhances the security and safety. On the contrary the general perception is that mobile phone has been a security threat and in places requiring high level of security, mobile phones are not allowed. With terrorist related cases wrecking havoc at many places around the world, the security agencies have expressed the apprehension many a times that mobile phone can be used as mobile triggered explosive device. The researcher instead preferred to highlight the sense of relief that parents get when they are able to know about the whereabouts of their friends and relatives as an asset for security. This aspect instead could be termed as a feature leading to more privacy and independence to the young generation. Now they are able to roam around with their friends without any undue tension on the part of their parents. Another aspect which could have touched briefly in this section is the health hazards from excessive usage of mobile. The trend of listening uninterrupted music by inserting earplugs in the earlobes for longer hours, talking on phone while driving, ringing the phone bell in a hospital or similar such places where we are expected to keep silence are some of the shortcomings that are often witnessed as the deficiency in the behaviour of users. Therefore, researcher could have highlighted this fact instead. Though, some of these things have been mentioned in later sections of the dissertation, but it leaves scope for more. In addition, the factors like online id-thefts, internet frauds, virus penetrations and security features like encryption technology could have been explained in this section. Highlighting the non-verbal communication aspect of mobile use, the researcher seems to have taken note of the surroundings. The mobile instrument has indeed become a style statement amongst the youth. The type of wallpaper being used by the individual and the ringtones set up by the user, tells a story about the nature of the individual and his/her preferences. It is therefore quite well stated that the usage of mobile phone, colour and type of mobile phones, ringtones and wallpapers do communicate something about the user. Mobile phone companies too have realised the potential of working on this opportunity with offers for downloading ringtones, wall-papers, games, music, quizzes etc. In fact such offers are an important component of m-commerce. Most of these downloads require some payment to be made. Therefore, the dissertation has made a good beginning by citing such practical instances, which might help companies at later stage in activating m-commerce on the mobile handsets. It is true that mobile is no more a luxury, but it has become a necessity instead, therefore the fact that mobile was introduced as a friendly gadget amongst the Italian society helped the cause of diffusion of value added services in Italy. Researcher has segmented the mobile users into two main categories. One, who use it as a purely communication tool and an instrument for socialisation; while in the other category the researcher has kept adults with more economic power. Researcher contends that the economically well-off adults are the main targets of the companies for the purposes of m-commerce. It is worthwhile here to mention that the SMS function too is a part of the marketing efforts from companies and there are occasions when the companies ask their customers to send across SMS at some premium numbers with rates higher than the normal SMS rates. This is also a form of m-commerce. One more thing which needs to be highlighted here is the focus on youth by the companies for their products and services. Therefore, companies on the lookout for m-commerce avenues are not only after the economically well-off people, but they are also grooming the youth segment as potential customers for the future. This aspect seems to have missed the attention of the researcher. The beeping phenomenon is well explained by the researcher. With interesting examples of people indulging in ‘missed calls’ or beeps on other persons’ mobile phone, it has been explained how such communication can often pass on the message without resulting in any expenditure or payment. The ‘richer guy pays’ is another aspect which appears quite appropriate for the m-commerce proposition, because under such circumstances the companies will have to look out for innovative ideas to make use of the available resources. Though, scarcity of enough funds at the disposal of mobile customers also leads to such behaviour, but exploring the potential with attractive schemes will certainly lead to more usage by the customer and better business for the mobile communication providing companies. This aspect could have been explored some more by the researcher. While explaining the business models for mobile commerce, the researcher has talked about a number of models like user fee business model, shopping business model, marketing research model, improved efficiency business model, advertising business model, and revenue sharing business models. These models explain the nitty-gritty of different types of mobile commerce techniques. These models have been explained quite well in the dissertation with inclusion of some examples as well. But, at times it appears that the researcher is somewhat more inclined towards explaining the context of Japan in mobile usage. This could have been because of the researcher happens to be well informed about the Japanese market or he has plenty of resources about the Japanese market. Well, there’s nothing wrong as far as the information and comparisons are concerned, but the fact that Italy and Japan happen to be two different types of markets leaves scope for thinking as to why this emphasis on Japan. While Japan is a leading Asian country, Italy happens to be not-so leading European economy. Therefore, it would have been better if the researcher would have focused some more on the statistics about the EU or OECD nations in general. The Italian mobile communication scenario has indeed been explained in detail in the later parts, by comparing it with some other markets in surrounding areas. Besides the case studies, primary data has been collected for the study using survey from a website with the help of 33 questions answered from 125 people. The results have subsequently been tabulated and analysed using MS-excel tools like pi-charts to arrive at the final conclusion. The pi-chart illustrations help in easily identifying the differences of opinion amongst the respondents. The research study concludes that as of now, Italians do not appear keen on going ahead with the mobile commerce in a big way, but there are indications of a promising future for this value added service. References: 1. MEED (2009). Dubai First and Du launch region's first pilot programme for NFC-based mobile payments. Available online at http://www.ameinfo.com/197243.html (May 19, 2009) Read More