Impacts of Information Technology on Society in the New Century
Route de Chavannes, 27C
Impacts of Information Technology on Society in the new Century
In the past few decades there has been a revolution in computing and communications, and all indications are that technological progress and use of information technology will continue at a rapid pace. Accompanying and supporting the dramatic increases in the power and use of new information technologies has been the declining cost of communications as a result of both technological improvements and increased competition. According to Moore's law the processing power of microchips is doubling every 18 months. These advances present many signi cant opportunities but also …show more content…
The impact of information technology on the rms' cost structure can be best illustrated on the electronic commerce example. The key areas of cost reduction when carrying out a sale via electronic commerce rather than in a traditional store involve physical establishment, order placement and execution, customer support, stang, inventory carrying, and distribution. Although setting up and maintaining an e-commerce web site might be expensive, it is certainly less expensive to maintain such a storefront than a physical one because it is always open, can be accessed by millions around the globe, and has few variable costs, so that it can scale up to meet the demand. By maintaining one 'store' instead of several, duplicate inventory costs are eliminated. In addition, e-commerce is very eective at reducing the costs of attracting new customers, because advertising is typically cheaper than for other media and more targeted.