IM-Based E-Commerce’s Missing Link: Security

Why does there always have to be a catch?

E*Trade’s (NYSE: ET) Latest News about E*Trade Inc E*Trade Inc Web Site recently announced agreement to deliverstreaming financial data and trading access throughYahoo’s (Nasdaq: YHOO) Latest News about Yahoo Inc Yahoo Inc Web Site instant messaging (IM)technology shows refreshing promise and optimism.

A technophile at heart, I immediately began toimagine IM-based e-commerce scenarios that wouldrevolutionize business and consumer e-commerce.

But wait a minute. Haven’t we been down this road before?

In order for IM to graduate from electronic chitchat toe-commerce, it first must close its egregioussecurity gaps.

Instant Gratification

Prevailing consensus indicates that IM — which currentlyboasts 200 million users worldwide — could become the next “killer app.”

By 2003, research firm Gartner (NYSE: IT) Latest News about Gartner Gartner Web Site said, 70 percent of enterprises will employ workers who use IM services.

And by 2005, instant messaging will surpass e-mail as the primary way inwhich consumers interact electronically, according to Gartner. In addition, IM will be integrated into 50 percent of businesses’ customer-interaction applications.

Research firm IDC Latest News about IDC IDC Web Site has estimated that by 2004, nearly 2trillion instant messages will be sent annually.

Unfulfilled Promise

E*Trade and Yahoo! are to be applauded fortrying to harness and monetize this technology’s burgeoning user base.

IM’s immediacy holds promise for real-timecross-enterprise collaboration, telephone-qualitycustomer service, and streamlined portable e-commerceapplications.

But for the same reason that much-hyped Web services couldstall, consumers and businesses will not conduct business over IM until concerns about the security flaws inherent in real-time connectivity are assuaged.

IM market share leader AOL Time Warner (NYSE: AOL) Latest News about AOL Time Warner Inc AOL Time Warner Inc Web Site undoubtedly would agree. Earlier this year, thecompany discovered a “buffer-overflow” vulnerabilityin its AOL Instant Messenger Latest News about AOL Instant Messenger AOL Instant Messenger Web Site product that could have allowedhackers to take control of desktop computers andcripple entire corporations with worms and viruses.

On January 3rd, AOL Time Warner claimed it had repaired the glitch.

Dangerous Communication

The problem with IM is that it relies on insecurecommunication protocols that cannot be policed bytraditional firewalls and gateways.

What is more, it is difficult to scan files for viruses attached to IMmessages.

Not surprisingly, some analysts are pushing forenterprise-class versions of IM technology that have tighter security provisions.

Perhaps an industrial-strength version of Microsoft’s (Nasdaq: MSFT)

1 Comment

  • Most of the IM systems are insecure and therefore they might be blocked by a corporate firewall.
    The popularity of IM systems is rapidly increasing and this leads to an increasing use of IM within companies, without the approval of the management or even the awareness that it is used within the company. If they find out, in most cases the IM system will be forbidden.
    But the future is bright because currently there is a fully secure and firewall-friendly IM system in the market, where even the users can communicate in their own language, because automatic translation of sufficient quality will ensure a good understanding. This will tear down the barriers to communication and will enable companies and organizations to globalize.
    Please give me some feedback.
    Robert Versteeg

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