Electronic Auctions & expressive mechanisms

- P. Haritha

12031J0078

Agenda
Introduction Various types of e-auctions Benefits and limitations of e-auctions Hazards of e-auction fraud and possible countermeasures Auction protocol Expressive mechanisms

Electronic auctions & expressive mechanisms

06/11/2013

Introduction
Formalized trading procedures in which the trading partners interaction is governed by specific trading rules. Auctioneer will act as an intermediary.

The auction patterns vary with the trade objects and trade rules. Since the diffusion of the Web has gained momentum and the number of Web users is rising steeply Electronic markets particularly Electronic Auctions gaining demand. Auction Protocols for ensuring different security properties
Electronic auctions & expressive mechanisms 06/11/2013

What is an Auction?

Electronic auctions & expressive mechanisms

06/11/2013

Types of auctions
Forward auction
An auction in which a seller offers a product to many potential buyers

Sealed-bid auction Auction in which each bidder bids only once; a silent auction, in which bidders do not know who is placing bids or what the prices are Reverse auction
Auction in which the buyer places an item for bid (tender) on a request for quote (RFQ) system, potential suppliers bid on the job, with the price reducing sequentially, and the lowest bid wins

Electronic auctions & expressive mechanisms

06/11/2013

Benefits of E-Auctions
Benefits to sellers
Larger reach and increased revenues Optimal price setting Lower transaction costs Lower administrative costs Better customer relationships

Benefits to buyers

Opportunities to Find Unique Items and Collectibles Lower prices Anonymity Convenience

Benefits to E-Auctioneers

Higher repeat purchases A stickier Web site Expansion of the auction business
06/11/2013

Electronic auctions & expressive mechanisms

Limitations of E-Auctions
Possibility of fraud Limited participation Security Auction software Equipment for buyers Order fulfillment costs

Electronic auctions & expressive mechanisms

06/11/2013

Types of E-Auction Fraud

Bid shielding
Having phantom bidders bid at a very high price when an auction begins, they pull out at the last minute, and the real bidder who bid a much lower price wins

Shilling
Placing fake bids on auction items to artificially jack up the bidding price
Electronic auctions & expressive mechanisms 06/11/2013

Cond
Fake photos and misleading descriptions Improper grading techniques Bid siphoning
Users send e-mail to bidders of a current auction to offer the same merchandise for a lower price elsewhere

Failure to pay

Electronic auctions & expressive mechanisms

06/11/2013

Protecting against E-Auction Fraud

User identity verification Authentication service Grading services Feedback forum Nonpayment punishment Item verification Buyer protections
06/11/2013

10

Electronic auctions & expressive mechanisms

Rules
Buyers should get correct information. Sellers should get the accountable bids. Auctioneers must get to be trusted.

11

Electronic auctions & expressive mechanisms

06/11/2013

Auction protocol
Different auction protocols have been designed to achieve different goals and requirements Some auction protocols based on the common rules

12

Some auction protocols based addressing the timing issue of the internet auctions
Every auction protocol have developed based on the well-known algorithms or procedures like RSA,SSL, DES.
Electronic auctions & expressive mechanisms 06/11/2013

Sealed Bid

13

Example :- U.S Govt used this to sell a Govt land. Issues while developing the protocol Time of disclosure is important. Non-repudiation mechanisms to ensure payments collected from the bid winners Bidders to be anonymous

Electronic auctions & expressive mechanisms

06/11/2013

Phases
Bidding secretly Opening and announcing winner These process should ensure two properties Validity :

14

The auction eventually closes The winner will be announced based on publically known rule The money collected from the winner should be equal to his bidding amount Looser bidders wont get any money or item. Only winning bidder can collect the item.

Secrecy :

Identity of bidder and biddings wont revealed Anonymous bids allowed The messages between the bidders and sellers wont get interrupted or manipulated
06/11/2013

Electronic auctions & expressive mechanisms

EXPRESSIVE MECHANISMS
Especially on the internet have begun allowing people or organizations to express richer preferences in order to provide for greater levels of overall satisfaction Expressive mechanisms leads to increase in efficiency. Combinatorial auction (CA) This allows participants to express valuations over packages of items. multi-attribute settings where the participants can express preferences over vectors of attributes of the itemor, more generally, of the outcome.
Electronic auctions & expressive mechanisms 06/11/2013

15

Conclusion
The Web has provided low-cost access to a global market space and at the same time highly focused customer groups. Cost-efficient communication infrastructures and low-cost marketengines have enabled auctioneers to set up auctions quickly and with limited investments. Mechanisms for secure payments encourage customers to opt for Web auctions with electronic trade execution

16

Electronic auctions & expressive mechanisms

06/11/2013

17

Electronic auctions & expressive mechanisms

06/11/2013

18

Electronic auctions & expressive mechanisms

06/11/2013