Now cyberspace has its own mall.
A Silicon Valley consortium has launched a computer network within the larger worldwide network known as the Internet, hoping to create a "virtual marketplace" where businesses can buy and sell in a secure, comfortable electronic environment.
If it is successful, the CommerceNet trial project, announced Tuesday, could vastly expand the use of the Internet as a medium for business transactions. Eventually it could pave the way for computerized consumer shopping through the use of multimedia catalogs that could be updated instantly.
According to members of the consortium, the key differences between CommerceNet and existing Internet services will be that it combines secure encryption and identity-verification technology with an easily understood on-screen display.
Companies have been reluctant to use the Internet for transactions or sensitive business communications because it has been notoriously insecure and offered no way to be sure the name on a message was the true identity of the sender. In addition, the Internet's complexity made it difficult for all but the most dedicated computer users to find their way around the largely "unmapped" network.
Steve Harari, president of Enterprise Integration Technologies of Palo Alto, Calif., said CommerceNet is a "totally revolutionary concept."
He said the network would allay businesses' concerns about the Internet by using advanced Secure-HTTP cryptography from RSA Data Security of Palo Alto and a point-and-click Internet gateway program called Mosaic, developed by the National Center for Supercomputer Applications at the University of Illinois.
CommerceNet has the backing of some of Silicon Valley's largest technology companies, including Intel Corp. and Apple Corp. Besides EIT, other members of the CommerceNet consortium are Stanford University and the Bay Area Regional Research Network.
Mr. Harari said CommerceNet had 40 vendors signed up for its launch this week and expects to have as many as 250 by the end of this year and 1,000 by the end of 1995. Those companies would pay an estimated $1,500 a year for a "storefront" in the electronic mall. Prospective buyers could shop for free. At first the service will be available only in the Silicon Valley area, but EIT expects it to extend its reach around the world.
In a typical transaction, Mr. Harari said, a corporate purchasing officer might call up CommerceNet on his computer and get a kind of electronic Yellow Pages. Clicking on the name of a company would bring the shopper to its electronic storefront, which would advertise a menu of choices. The purchaser could get background information on the company, check prices and in some cases view color images or even full-motion video of the seller's products.
After making a choice, the buyer would be able to send orders directly to the seller through the same program, which would operate around the clock. The transaction messages would be encrypted on the buyer's end and decoded on the seller's end. The encryption software would use a "digital signature" to verify the identity of the seller, thus avoiding what George Washington University professor Lance Hoffman called "the electronic equivalent of the unwanted pizza at the door."
"It's a logical step forward in moving the Internet toward electronic commerce," said Mr. Hoffman, director of the school's Institute for Computer and Telecommunications Policy.
But Kathryn McCabe, editor of Online Access magazine, sounded a note of caution, pointing out that there are many other groups aiming to tap into the same market.
"It's only significant if it works," she said. "It's like a horse race, and there are so many good candidates."