Chapter 3 • Telecommunications and Networking 89used by travel agencies, but in the 1990s the airlines and
online travel companies moved beyond the travel agencies
by giving users the ability to make their own reservations
online, effectively bypassing travel agencies entirely. Each
of the major airlines has its own Web site where users can
buy tickets and select seats on future flights as well as
make hotel and rental car reservations. These capabilities
plus the ability to do comparative shopping are available
on the Web sites of three major online travel companies:
Travelocity (part of Sabre Holdings, a spin-off from
American Airlines), Expedia (developed by Microsoft and
spun off in 1996), and Orbitz (created by five airlines—
American, Continental, Delta, Northwest, and United).
These sites provide information, process ticket sales for
flights from almost all airlines, and offer other travel serv-
ices such as hotel and rental car reservations. To access
Travelocity, go to http://www.travelocity.com; for Expedia, go to
http://www.expedia.com; and for Orbitz, go to http://www.orbitz.com.
Connectivity
Connectivity is a very popular buzzword among major
U.S. and international corporations. Most large and
midsized (and many smaller) organizations now provide a
personal workstation for every managerial and professional
employee, and these workstations are connected to a
network structure (often an intranet) so that each employee
has access to every person, and every system, with which
he or she might conceivably need to interact.
Connectivity to persons and organizations outside the
firm is also important. As an example, all of the major auto-
mobile manufacturers have installed systems to tie their deal-
ers to the corporation so that two-way data communications
can take place and deviations from expected sales can be
spotted quickly. In addition, the automobile manufacturers
are stressing connectivity with their suppliers so that they can
adjust orders efficiently. Thus, connectivity throughout the
customer–manufacturer–supplier chain is a critical element.
Electronic Data Interchange and Electronic Commerce
Electronic data interchange (EDI)will be covered more
completely in Chapter 7, but it is certainly part of the
exploding role of networking. EDI is a set of standards and
hardware and software technology that permits business
documents (e.g., purchase orders, invoices, and price lists)
to be transferred electronically between computers in
separate organizations. For the most part, the transmission
of EDI documents takes place over public networks,
including the Internet. The automobile industry is perhaps
the most advanced in the use of EDI, but many other firms
and industries have also adopted this technology.
Electronic commerce(also called e-business) is a
broad term that incorporates any use of telecommunica-
tions and networking to conduct commercial activities.
EDI is part of electronic commerce, but the most explosive
electronic commerce area involves commerce over the
World Wide Web. Electronic commerce includes online
catalogs, online ordering, online payment for goods and
services, and sometimes online delivery of products. A
number of virtual stores and shopping malls have been set
up on the Web, and an incredible array of products is
offered. Electronic commerce over the Web is burgeoning,
and there is no end in sight. The authors of this book, for
example, have purchased software and electronic books on
the Web and immediately downloaded them; registered
online for conferences; made hotel and airline reserva-
tions; and purchased books, CDs, clothes, and a variety of
gifts on the Web for offline delivery. Shopping on the Web
has become important for most consumers. As you will
learn in Chapter 7, electronic commerce is even more
important for businesses than for consumers.Marketing
In addition to electronic commerce, telecommunications is
being used for many other applications in the marketing
area. All business organizations sell products and services,
although the distribution channels vary widely. The sales
function is often performed either by sales representatives
employed by the firm or by independent agents aligned
with the firm (e.g., an insurance agent). In either case,
telecommunications is being widely used to provide
support for the sales personnel. If the salesperson works in
an office, this support is usually provided through a
networked desktop computer; if he or she is on the road, it
is usually provided via a laptop microcomputer that can
establish a wireless or wired connection to the organiza-
tion’s WAN or the Internet. This computer-based sales
support includes an application to be able to enter orders as
well as to be able to check on the status of orders; it also
provides an electronic communication channel to be able
to get answers to customers’ questions from others in the
organization.
In addition, sales support often takes the form of
online information describing product or service character-
istics and availability. This up-to-the-minute information
makes the sales representative or agent more competitive
and increases the organization’s profitability (as well as
increasing the chances of retaining productive sales
personnel). The importance of this instantaneous informa-
tion is apparent for a Denver-based Edward Jones financial
advisor talking to a client who is considering the purchase
of a stock on the New York Stock Exchange, but it is