Electronic Commerce Chapter  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 3–1 Learning Objective Explain the history of the Internet and how it works  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 3–2 Electronic Networks Electronic networks are groups of computers that are connected together electronically Local area networks (LANs) are networks that span a single site Metropolitan area networks (MANs) span a single city or metropolitan area  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 3–3 Electronic Networks Wide area networks (WANs) are networks of computers that span at least two metropolitan areas  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 3–4 The Internet The Internet is an electronic highway that allows computers to communicate with each other The earliest practical version of the Internet was created in the early 1970s by the Pentagon’s Advanced Research Projects Agency (ARPA) It was called ARPANET  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 3–5 The Internet Bitnet MILnet NSFnet They adopted a common set of communications protocols called TCP/IP (Transmission Control Protocol/Internet Protocol)  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 3–6 The Internet Transmission Control Protocol (TCP) divides electronic messages into “packets” of information and then reassembles these packets at the end Internet Protocol (IP) assigns a unique address to each computer on the Internet  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 3–7 The Internet Fixed IP address Dynamic IP address Domain name Domain name servers  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 3–8 Learning Objective Describe intranets and explain how they are made secure  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 3–9 Intranets It is a self-contained, in-house internet Extranets exist when the intranets of two or more companies are linked together  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 3– Double-Key Encryption Recipient’s private key Message key Encrypted message key Ciphertext Public-key decryption Private-key decryption  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood Message 3– Digital Signatures A digital signature occurs when someone encrypts a message with his or her own private key What is a hashing function? A hashing function takes a long variable-length string of characters and converts it into a short fixed-length string  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 3– Digital Signature Creation Hashing algorithm Sender’s private key Hash of message Public-key decryption Digital signature Message  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 3– Verification of Digital Signature Message Digital signature Hashing algorithm Public-key decryption Hash of message Verify signature Sender’s public key  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 3– Digital Time-Stamping What is a digital time-stamping service (DTS)? It is an organization that adds digital time-stamps to documents  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 3– Digital Time-Stamp Procedure Attach date and time, then digital signature Message Digital Digitaltime time stamp stampservice service Message  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood Date and time Digital signature 3– Verification of Digital Time-Stamp Message Date and time Hash message Hashed message and date and date and time and time Verify Verify match match Digital signature Decrypt DTS’s signature with DTS’s public key Decrypted digital signature  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 3– Security Issues for Public-Key Encryption Systems What is cryptanalysis attack? It involves various techniques for analyzing encrypted messages for purposes of decoding them without legitimate access to the keys The simplest possible attack on a message is the guessed plaintext attack  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 3– Security Issues for Public-Key Encryption Systems The whole security of public-key encryption depends on the assumption that an attacker cannot factor the product of two large prime numbers (factoring attack) The best way to prevent cryptanalysis and factoring attacks is to use very long keys  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 3– Security Issues for Public-Key Encryption Systems What are some ways of protecting private keys? Creating and distributing keys Digital certificates Certificate revocation list (CRLS) Certificate chains Certificate-signing units Key expirations  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 3– Electronic Commerce and Encryption Technology What is digital cash? It is money created when a bank attaches its digital signature to a note promising to pay the bearer some amount of money  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 3– Electronic Commerce and Encryption Technology What is blinding? It is a technique in which a bank issues digital cash in such a way the it is unable to link the payer to the payee What is a blinded digital signature? It is a digital signature and related digital cash that have been issued with blinding  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 3– Computer Software and Computer Card Systems What is an electronic wallet? It is a computer program that keeps track of the various keys and items of information associated with digital money What are smart cards? They are hand-held electronic cards that are used for payments  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 3– Computer Software and Computer Card Systems Memory cards Shared-key cards Signature-transporting cards Signature-creating cards  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood 3– End of Chapter  2004 Prentice Hall Business Publishing, Accounting Information Systems, 9/e, by Bodnar/Hopwood – 47 ... networks (LANs) are networks that span a single site Metropolitan area networks (MANs) span a single city or metropolitan area  2004 Prentice Hall Business Publishing, Accounting Information Systems,... Business Publishing, Accounting Information Systems, 9/e, by Bodnar/ Hopwood 3– Commerce on the Internet It is a robot-type program that constantly runs on some computers and exchanges information with... Publishing, Accounting Information Systems, 9/e, by Bodnar/ Hopwood 3– Commerce on the Internet What is a client? It is a program that accesses and exchanges information with a server A great many of