1 Applications of Computers Lecture-3

2 E-Commerce 4 Almost all major companies have their homes on the web, mainly for advertising 4 Companies were reluctant towards e- commerce but now it is picking up 4 The most revolutionary e-commerce is between business and customer 4 Business-business e-commerce is already developed

3 E-Commerce Requirements 4 E-commerce between customer and business requires several functions 4 For example, auction sites should have the capability to track bids by various people 4 Also, multi-vendor selling sites should support tracking of multiple companies 4 Transactions between customers and the e- commerce site should be safe and secure

4 The Credit Card Concerns 4 Almost all e-commerce sites offer credit card support 4 A customer who wants to buy something pays with credit card 4 The credit card information is transmitted through the public network and it can be tapped by someone in the middle

5 Encryption and Data Security 4 For successful e-commerce, we must ensure that the sensitive data has been encrypted and secured 4 Encryption transforms the data using a “key” into a value that is meaningless in its normal form 4 This encrypted value can only be decrypted by authorized agency or person

6 Securing the Connection 4 For protecting the credit card info, it is transmitted under SSL (secure sockets layer) 4 It means the card info is encrypted and it is very difficult to break the code by an intruder 4 Surprisingly, the misuse of the card info by employees is a more serious concern

7 Encryption and Data Security 4 For successful e-commerce, we must ensure that the sensitive data has been encrypted and secured 4 Encryption transforms the data using a “key” into a value that is meaningless in its normal form 4 This encrypted value can only be decrypted by authorized agency or person

8 Encryption Basics 4 For encryption, XOR logical operation is widely used 4 The data to be encrypted is XORed with the key 4 XOR has the property that it can transform a binary value into another totally different value. This encrypted value is sent instead of the original value 4 The recipient performs XOR of the received encrypted value with the key, restoring original value

9 Class Example 4 The data to be sent is: The 4-bit key is SENDER: Encrypt the data and send it to the recipient 4 Encrypted Data is obtained by repeatedly performing XOR operation with the key 4 First Four bits 0111 XOR 1010 gives the result 1101

10 Class Example 4 Next Four bits 1011 XOR 1010 gives the result RECIPIENT: Decrypt the data 4 First Four bits 1101 XOR 1010 gives the result 0111 (original data recovered) 4 Next Four bits 0001 XOR 1010 gives the result 1011 (original data recovered)

11 Encryption Keys 4 There are two types of encryption schemes in use 4 In symmetric or secret key ciphers, the encryption and decryption keys are symmetric and identical 4 As an example, consider this diagram then encrypt following message with your own encryption scheme 4 “Please transfer six million dollars into my checking account”

12 Symmetric Cipher Adapted for academic use from “Exploring The Digital Domain” by Abernethy Allen, ITP 1999

13 Symmetric Cipher 4 In symmetric secret key cipher, the key must be sent to recipient, otherwise the message cannot be decrypted 4 Sending the key on public network is like putting your house key in locksmith’s shop and allowing everyone to duplicate it 4 Alternatives are to restrict access to secret key to a few individuals

14 DES 4 DES (Data Encryption Standard) is one example of symmetric key encryption 4 DES uses a 56-bit key which can be doubled in length to 112 bits 4 Breaking messages encrypted with DES would require a considerable amount of computing time and effort

15 Alternate Payment Methods 4 DIGICASH is an alternate payment method that does not use credit cards for online buying 4 Customer opens an account and an electronic wallet is created at customer’s machine 4 Customer is able to create digital coins that are certified by the bank

16 Digicash is now eCash The new p2p technology is developed by the eCash technologies 4 Refer to the link below: 4 s/p2p.asp

17 Alternate Payment Methods 4 The bank attaches a digital signature to each digital coin 4 Thus, the customer can send digital cash to the vendor and buy anonymously 4 VIRTUAL PIN allows credit card charges without transmitting card number 4 The bank holds customer’s credit card information and issue a virtual PIN to customer

18 Alternate Payment Methods 4 Customer specifies virtual PIN to a merchant when charging something to credit card 4 Merchant sends this PIN to bank for verification 4 Bank requests customer authorization via and on confirmation, charges the amount of sale to customer’s credit card