Mobile Commerce: Emerging Trends and issues of Intellectual Property Rights
By
*Jasper Vikas George

The scope of this article is to explore the possibilities of corporate good governance through ‘Mobile phones’. The advent of e-commerce has opened the much-awaited human technologies. M –commerce is foremost among them. The much-used facility in mobile is SMS. Presently it is used as an instant means of communication where we can inform our beloveds in a spur of moment about our activities. But this ‘sms’ can be used as a means of commerce too. We can use sms for placing orders or making payments through it. In the words of Hong Liang Lu, president and CEO, UTStarcom, “[India] will need data and broadband capabilities for economic growth.” The need of the hour is extensive and imaginative use of information and communication technologies (ICTs) in day-to-day management of urban local bodies to increase the effectiveness and efficiency of their operations.

Global Mobile Commerce: Its Emergence and Growth

“Information and Communication Technologies ICTs have a particularly vital role to play in transforming the interface between governments and the citizens they serve, particularly in urban agglomerations.” Daya Nidhi Maran[1] said, “adding because of growing literacy and awareness levels among citizens their expectations in terms of services from the local bodies are also rising rapidly. “It is, therefore, imperative that these bodies are geared to provide efficient services, meet the demands of the citizens and make their interaction with municipalities easy and simple, while ensuring accountability and transparency.” We will discuss here the consequences and the management of mobile commerce in detail and its impact on corporate good governance. Below we will discuss in detail the possibilities of doing commerce through mobile phones and the additional advantage it has to prosper Corporate Good Governance.

The term "mobile commerce" has recently not only has achieved widespread recognition after Hutch ties up with Citibank for mobile commerce but it becoming a highly visible symbol in the contemporary language of the information technology culture that brought significant changes in the consumer era and also brought profound changes in the terminology and technology of E-Commerce. Beginning of the new millennium had seen numerous speedier changes in the field of commerce, E-commerce and Internet Banking is foremost among them. The world is becoming nearer and nearer due to fast and new use of human technologies such as Mobile and palmtops. The m-commerce has broadened its wings in last few months only. The traditional way of playing in the field of e-commerce is by way of using computer and the Internet to trade goods and services in a new, direct and electronic manner. This technology is now expanding its arms. The use of ‘Mobile’ as a part of e-commerce is not going to be justice with ‘M-Commerce’. But because it is a new field, it required a separate identity. It is ‘M- Commerce’.

Until now, a number of studies and publications have addressed different aspects of electronic commerce because it is used as a faster and cheaper mode of communication. It provides both efficiency and swiftness. Mobile commerce is yet to be popularized. A new revolution is waiting. Hutch with Citibank and MasterCard had launched a co-branded debit and credit card offering ‘M-commerce’ capabilities to Hutch customers. The Hutch Citibank credit card members will relish the full-fledged facilities of ‘M-Commerce’. They will able to conduct m-commerce over the mobile phones.

We have to take initiatives to properly make ‘M-Commerce’ an effective way of commerce. Before going a head, it is necessary to define the terms such as ‘electronic’, ‘mobile’ and ‘commerce’. The term "electronic" can be taken to refer to the global infrastructure of computer and telecommunication technologies and networks upon which the processing and transmission of digitized data take place. It is a development from the early, private and proprietary networks, on which electronic transactions have been commonplace for several decades, to open networks with non-proprietary protocols, such as the Internet, has been well acknowledged. The term Internet is defined as a set of computer networks possibly dissimilar joined together by means of gateways that handle data transfer and the conversion of messages from the sending network to the protocols used by receiving network. The present millennium is witnessing a new culture ‘Internet culture’ which is already changing our way of life significantly. Internet allows communications and transactions to take place over an "open network”. The open nature and character of Internet has increasingly low-cost access, which has stimulate the potential for electronic commerce.

The term “commerce” relates to an expanding range of activities taking place on the open networks – buying, selling, trading, advertising, transactions etc. This lead to an exchange of value between two parties. On-line auctions, banking and other financial services, sales of software, and an ever-increasing diversity of Internet sites offering a broad range of consumer goods or services such as bazee.com etc has not only revolutionized the concept of market but it also has a great impact on the nature of Business transactions.  

Defining Mobile commerce  

The term “mobile phone” can refer to the phones which are Moving or capable of moving readily (especially from place to place) with out the use of any wire. To mobile phone, the cellular service providers provide the connectivity. They are of two types i.e., Fixed or landline telecommunications and Mobile telecommunications. They provide these services at different categories such as Fixed Access Services (includes fixed and fixed wireless terminals), Cellular Services (includes GSM and CDMA mobile), etc. In the earlier times, phones are used only as a speedier means of communication, which was used for luxurious purposes. Later on, it used for business purposes. The legal problem was raised when it is found that under Sections 4 and 5 of Indian Contract Act there was no specific mention of communication of offer and acceptance and the revocation thereof, in relation to telephone and telex. In Bhagwandas v. Girdharilal & Co[2] Supreme Court held that in the case of telephonic conversation, the position is the same as in the case where the parties are in the presence of each other, and the rule of a contract through post does not apply to such contracts. Explaining the nature of contract entered into on phone it was observed: - “In the case of a telephonic conversation, in a sense the parties are in the presence of each other: each party is able to hear the voice of the other. There is instantaneous communication of speech intimating offer and acceptance, rejection or counter-offer. Intervention of an electrical impulse which results in the instantaneous communication of messages from a distance does not alter the nature of the conversation so as to make it analogous to that of an offer and acceptance through post or by telegraph.[3]”

It is same with M-Commerce too. As because it is an instantaneous means of communication the parties are in presence of each other. By mobile commerce, we mean the business transactions on Mobile Phones. The Hutchison Telecommunications International Ltd has made a beginning in M-Commerce. They are providing following facilities to the members of Hutch Citibank Credit Card Holders: -

Placing orders through SMS

Making Payments through SMS

Issuing Instructions to pay monthly utility bills

And to make this service a success they are offering ‘insurance cover against theft or loss of mobile handset, a personal air accident cover of Rs. 5 Lakhs and a three-month installment scheme at zero interest rate for purchase of handsets.’ 18 percent of the revenues of Hutchison Telecommunications coming from value-added services such as Push2 talk, click&print, mobile gaming, and accessing emails[4]. A revolutionary step is taken by ICICI bank by introducing a new service called “ICICI Bank Mobile Banking”. This service is free of cost. Under the above service, following facilities are providing to the customers.

Banking Alerts

Account getting credited

Account getting debited

Salary Credit

 Cheque Returns

Banking Requests

Account Balance (IBAL)

 Last 3 Transactions (ITRAN)

Cheque Status Enquiry (ICSI)

Stop Cheque Request (ICSR)

 Cheque Book Request (ICBR)[5]

This is just the beginning of M-Commerce. ‘India’s communications (services) industry was pegged at Rs. 56,367 Crore ($ 12.25 billion) in the financial year 2003-2004, in comparison to 47, 121 crore in financial year 2002-2003[6]. The main attraction in the services industry was the cellular services segment. The cellular segment grew by around 72 percent in revenue terms and 135 percent in subscriber terms.’ Due to cutthroat competition, the cellular services providers come up with number of value added services both for Pre-paid customers and Post-paid customers. These value added services differ from Company to company. Like Tata Indicom provides following value added services:

Managed Data Network Services

Managed Voice Minutes

 Data Centre Services

 Broadcasting Service

 End-to-End ATM Service

 IPLC Services

 VPN Services

 Internet Leased Lines

 INMARSAT Service

 National Private Leased Circuit

 Corporate Internet Telephony Services[7]

Mobile commerce is the extension of communications technology. It not only has furnished us with the easy access to the wireless technology but it also provides us with the data satisfaction as is there in Internet. This easy and secure access to Business transactions had made e-commerce and now mobile commerce a success. But, there are certain issues, which need a serious concern. Foremost among them are Intellectual property issues. The concept of protection of Intellectual property stems from the desire of the human mind to recognize and encourage creativity. In mobile, with the help of Internet any individual can down load Softwares, Videos, Music Albums, etc. Not only this, by using other relevant apparatus, any body can make a copy of it in Home PCs, Lab Tops, and stored it permanently. The misuse of ‘Mobile Cameras[8]’ was already in use. Instead of buying a magazine, people are taking photographs of relevant pages. Not only this, in the international scenario, computer software industry is firmly against copyright violation but develops and sells software that make such practice easy. For instance, Cakewalk, the Boston-based music software giant, has developed a software - Cakewalk Pyro 2003, billed as 'the complete MP3 and CD maker', that has a slick, easy-to-use interface for transferring old record albums to CD-ROM with an included utility to edit out the pop and hiss. However, the same software can be used for easily making illegal copies of commercial music CDs, resulting in copyright violation. Not only that the upcoming is the cloning of the sim cards. So number of IPR issues involved here. Among important is the copyright violation.

The problem of violation of copyright is always an issue in the air. Emerging trend in this field is the violation of copyright in the Mobile phones. Duplicate Sim Cards is the current issue. This required the introduction of new penal provision in the copyright laws.

Corporate good governance and Mobile

Money is a widely accepted medium of exchange after the end of a barter system. Now electronic cash replaces this paper money. “With the advent of the Internet and Electronic Commerce, we are in the process of shifting significantly from paper currency to electronic cash. Stored-value cards with an embedded microchip that stores money in digital form may become a customary circulating medium along with privately supplied digital cash stored in computer hard drives. These can be used over the Internet to facilitate new-age commerce[9].” This commerce has not only reduced the transaction costs but it also helpful in expanding the markets and empowers the individuals. Mobile commerce i.e. the extension of electronic commerce is very helpful in preventing bank frauds.

Conclusion

The intrusion of information communication technology in our lives has changed our life completely. The whole world is coming closer. The mobile commerce is the future of globalization. The Issues in mobile commerce are numerous. Few are posted here. The complication arises due to mobile commerce need new laws. Corporate good governance is evolutionary in nature. Hence, Mobile commerce is just the stage of corporate good governance. The paradigm shift from management to governance is taken a head by the Mobile commerce.

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Notes

*Jasper Vikas George, Advocate, Delhi High Court, G & G Associates (Advocates and consultants). (M) 9818821498.

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[1] The Hindu, Wednesday, August 04, 2004. (Mr. Dayanidhi Maran, Minister of communications & IT, addressing at a national seminar on E-Governance in Municipalities, organized by the Department of Information Technology.

[2] AIR 1966 S.C. 543

[3] Ibid. at 549.

[4] The Hindu, Tuesday, July 27, 2004, p. 14

[5] Application for Mobile Banking Facility provided by ICICI bank.

[6] Voice Data, July 2004, p.16.

[7] Source, Tata Indicom Brochure published in Voice Data, July 2004

[8] DPS Dhamaka case

[9] James A. Dorn, “The Future of Money in the Information Age”

 

[Ed: Views Expressed here in are that of the Author]