Business Models in Digital Economy

Business models in Digital economy
Business model in Digital Economy

In this post, we will discuss the business models used in the world of information and communication technology (ICT). Although many of these models have parallels in traditional business, modern advances have reshaped few models and created few new ones.
The list provided below is by no means exhaustive.


Electronic commerce (e-commerce) is the online transaction of sale or purchase of goods or services, where the delivery and payment could be made online or through other modes.

Few prominent types of e-commerce business are:

Business to Business model (B2B)

Here business sells products or services to other business. It includes sales of goods or services, auction services (via the internet), logistic services, application service (service providers offering deployment, hosting, and management of packaged software from a central facility), outsourcing of support function, content management services and web-based commerce enablers that provide automated online purchasing capabilities.

Business to consumer models (B2C)

Here business sells goods or services to individual buyers. B2C models fall into several categories, for example, “pureplay” where the vendors have no physical stores; “click-and-mortar” businesses that supplemented existing consumer-facing business with online sales, and manufacturers that use online marketing to allow customers to order and customize directly.

Consumer to Consumer model (C2C)

Businesses involved in C2C e-commerce play the role of intermediaries, helping individual consumers to sell or rent their items by publishing their information on the website and facilitating transactions.

Payment Services

A payment service provider acts as an intermediary between online purchasers and sellers, accepting payments from purchasers through a variety of payment methods, processing those payments, and depositing the funds to the seller’s account.
Other alternative payment service providers are:
Cash payment solutions, in which a customer buys online, and pays in cash for the transaction.
Ewallets or cyber-wallets are previously charged through bank accounts and then used for the micropayments where frequent small amount transactions occur.
Mobile payment solutions encompass all types of technologies that enable payment using a mobile phone or smartphone, mobile card processing, in-app payments, and near field communication solutions.

App Stores

Application stores typically take the form of online platforms accessible through the consumer’s device, through which the consumer can browse, view, review, purchase and download the application on his device. Accessibility to application stores varies based upon the device used. Applications available are either free or chargeable.

Online Advertising

Online advertisements target and deliver marketing messages to individuals browsing on the internet.

Cloud Computing

Cloud computing is the provision of standard, on-demand and configurable computer services, where the hardware and the core software is with the service provider, and the users can access the service through the application or a front end software.

Different cloud computing service model:

Infrastructure as a service (IaaS)
computer infrastructure as provided as a service that includes servers, virtual machines, libraries, disk space, and other computing resources.

Platform as a service
Here the service provider provides a computing platform and programming tools as a service for software developers.

Software as a service (SaaS)
Service provider allows users to use the software from multiple devices through a client interface and web browsers.

Content as a Service
Where rights are obtained, and software is provided to allow content to be embedded by purchasers, content can be purchased as a service.

Data as a Service
Data from multiple sources can be aggregated and managed by a service provider, so that controlled access to that data can be granted to entities that may be geographically and organisationally removed from each other, without each entity needing to develop or acquire the infrastructure necessary to prepare and process that data.

High-Frequency Trading

High-frequency trading uses sophisticated technology, including complex computer algorithms to trade securities at high speed.

Participative networked platforms

A participative networked platform is an intermediary that enables users to collaborate and contribute to developing, extending, rating, commenting on, and distributing user-created content. User-created content (UCC) comprises various forms of media and creative works (written, audio, visual, and combined) created by users. A range of different distribution platforms has been designed, including text-based collaboration formats such as blogs or wikis, group-based aggregation, and social bookmarking sites, social networking sites, podcasting, and virtual worlds.

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