08 Ethics, Law and E-commerce
-
Upload
monchai-sopitka -
Category
Education
-
view
4.742 -
download
3
description
Transcript of 08 Ethics, Law and E-commerce
1
e-commerce
Kenneth C. LaudonCarol Guercio Traver
business. technology. society.
eighth edition
Copyright © 2012 Pearson Education
Chapter 8Ethics, Law and E-commerce
2
Copyright © 2012 Pearson Education
Why is “mischief” in virtual worlds more difficult to stop? What constitutes mischief in Second Life?
Which behaviors have been banned in Second Life?
Is there a consensus regarding whether or not in-game gambling and other virtual crimes are also actual crimes? What is Second Life’s stance?
How faithfully do you believe the law should be enforced in virtual worlds?
It’s in virtual world; Selling brand-name goods, conducting gambling, sellingsimulated prostitution service
Intolerance, harassment, assault, disclosure of information about other people’s real-world lives, indecency sexual behavior, and disturbing the peace
No. They prohibited all forms of gambling in July 2007
Discovering Law and Ethics in a Virtual WorldClass Discussion
Copyright © 2012 Pearson Education
Copyright © 2006 Pearson Education,
Inc.Slide 8-5
3
Copyright © 2012 Pearson Education
Learning Objectives Understand why e-commerce raises ethical, social, and political issues Recognize the main ethical, social, and political issues raised by e-
commerce Identify a process for analyzing ethical dilemmas Understand basic concepts related to privacy Identify the practices of e-commerce companies that threaten privacy Describe the different methods used to protect online privacy Understand the various forms of intellectual property and the
challenges involved in protecting it Understand how governance of the Internet has evolved over time Explain why taxation of e-commerce raises governance and
jurisdiction issues Identify major public safety and welfare issues raised by e-commerce
Copyright © 2012 Pearson Education
Understanding Ethical, Social, and Political Issues in E-commerce
Internet, like other technologies, can (see next Fig.):EnablenewcrimesAffectenvironmentThreatensocialvalues
Costs and benefits must be carefully considered, especially when there are no clear-cut legal or cultural guidelines
Slide 8-7
4
Copyright © 2012 Pearson Education
Copyright © 2010 Pearson Education,
Inc.Slide 8-8
Copyright © 2012 Pearson Education
A Model for Organizing the Issues Issues raised by Internet and e-commerce can be
viewed at individual, social, and political levels (see next Fig.)
Four major categories of issues: Informationrights– individualrightstotheirpersonalinfoinpublicmarketplaceandrightstoaccessinfoaboutbusinessandotherorganizations
Propertyrights– enforcementoftraditionalintellectualpropertyrightsinInternetworldwhereperfectcopiescanbemadeanddistributedworldwidewithinseconds
Governance– publiclawstogovernInternetande-commerce,andthelaw-makingbodies(state,federal,international)whohavejurisdiction
Publicsafetyandwelfare– toensureequitableaccesstoInternetande-commercechannelsbyschoolsandcolleges,ortodetermineifpornographyandgamblingarethreattopublicsafetyandwelfare
Slide 8-9
5
Copyright © 2012 Pearson Education
The Moral Dimensions of an Internet Society
Figure 8.1, Page 538Slide 8-10
Copyright © 2012 Pearson Education
Basic Ethical Concepts Ethics
Studyofprinciplesusedtodeterminerightandwrongcoursesofaction
Responsibility individuals,organizations,andsocietiesareresponsibleforactionstheytake
Accountability individuals,organizations,andsocietiesshouldbeheldaccountabletoothersfortheconsequencesoftheiractions
Liability Lawspermittingindividualstorecoverdamagesdonetothem
Due process Lawsareknown,understood Abilitytoappealtohigherauthoritiestoensurelawsappliedcorrectly
Slide 8-11
6
Copyright © 2012 Pearson Education
Analyzing Ethical Dilemmas Dilemma
Asituationwherethereareatleasttwodiametricallyopposedactions,eachofwhichsupportsadesirableoutcome
Process for analyzing ethical dilemmas:1. Identifyandclearlydescribethefacts:Findoutwho
didwhattowhom,andwhere,when,andhow2. Definetheconflictordilemmaandidentifythehigher-
ordervaluesinvolved:E.g.,advertisingnetworks(DoubleClick)increasesmarketefficiencyatthepriceofindividualprivacy
3. Identifythestakeholders4. Identifytheoptionsthatyoucanreasonablytake5. Identifythepotentialconsequencesofyouroptions:
Askyourself“WhatifIchoosethisoptionconsistentlyovertime?”
Slide 8-12
Copyright © 2012 Pearson Education
Help determine actions when confronted with an ethical dilemma: GoldenRule– Dountoothersasyouwouldhavethemdountoyou. Universalism– Ifanactionisnotrightforallsituations,thenitisnotrightforanycertainsituation.
SlipperySlope– Ifanactioncan’tbetakenrepeatedly,thenitisnotrighttotakeatall.
CollectiveUtilitarianPrinciple– Taketheactionthatachievesthegreatervalueforallofsociety.
RiskAversion– Taketheactionthatproducestheleastharm,ortheleastpotentialcost.
NoFreeLunch– Ifsomethingsomeoneelsehascreatedisusefultoyou,ithasvalueandyoushouldassumethecreatorwantscompensationforthiswork.
TheNewYorkTimes Test(PerfectInformationRule)– Givenyourdecisiononamatter,willthereactionofreadersbepositiveornegative?
TheSocialContractRule– Wouldyouliveinasocietywheretheprincipleyouaresupportingwouldbecomeanorganizingprincipleoftheentiresociety?
Candidate Ethical Principles
7
Copyright © 2012 Pearson Education
Privacy and Information Rights
PrivacyMoralrightofindividualstobeleftalone,freefromsurveillance,orinterferencefromotherindividualsororganizations
Information privacy Subsetofprivacy Includes:
Theclaimthatcertaininformationshouldnotbecollectedatall
Theclaimofindividualstocontroltheuseofwhateverinformationiscollectedaboutthem
Slide 8-15
Copyright © 2012 Pearson Education
Privacy and Information Rights (cont.)
Major ethical issue related to e-commerce and privacy: Underwhatconditionsshouldweinvadetheprivacyofothers?
Major social issue: Developmentof“expectationsofprivacy”andprivacynorms
Major political issue: Developmentofstatutesthatgovernrelationsbetweenrecordkeepersandindividuals
Slide 8-16
8
Copyright © 2012 Pearson Education
Information Collected at E-commerce Sites
Data collected includes Personallyidentifiableinformation(PII)- Datathatcanbeusedtoidentify,locate,orcontactanindividual(seenextFig.)
Anonymousinformation- Demographicandbehavioralinformationthatdoesnotincludeanypersonalidentifiers(e.g.,age,occupation,income,zipcode,ethnicity)
Types of data collected Name,address,phone,e-mail,socialsecurity Bankandcreditaccounts,gender,age,occupation,education Preferencedata,transactiondata,clickstreamdata,browsertype
Slide 8-17
Copyright © 2012 Pearson Education Slide 8-18
9
Copyright © 2012 Pearson Education Slide 8-19
Copyright © 2012 Pearson Education Slide 8-20
10
Copyright © 2012 Pearson Education
Social Networks and Privacy
Social networksEncouragesharingpersonaldetailsPoseuniquechallengetomaintainingprivacy
Facebook’s facial recognition technology and tagging
Personal control over personal information vs. organization’s desire to monetize social network
Slide 8-21
Copyright © 2012 Pearson Education
Profiling and Behavioral Targeting Profiling
Creationofdigitalimagesthatcharacterizeonlineindividualandgroupbehavior
Anonymousprofiles Identifypeopleasbelongingtoveryspecificandtargetedgroups E.g.,20-30-yr-oldmales,withcollegedegreesandincome>$30,000/yr,andinterestedinhigh-fashionclothing
Personalprofiles Addpersonalidentifiers(email,postaladdress,phonenumber)tobehavioraldata
Advertising networks can TrackconsumerandbrowsingbehavioronWeb Dynamicallyadjustwhatuserseesonscreen Buildandrefreshprofilesofconsumers
Google’s AdWords program
Slide 8-22
11
Copyright © 2012 Pearson Education
Profiling and Behavioral Targeting (cont.)
Deep packet inspection RecordseverykeystrokeatISPlevelofeveryoneandusesinformationtomakesuggestionsandtargetads
Business perspective: Increaseseffectivenessofadvertising,subsidizingfreecontent Enablessensingofdemandfornewproductsandservices
Critics’ perspective: Underminesexpectationofanonymityandprivacy
Consumers showsignificantoppositiontounregulatedcollectionofpersonalinformation
Slide 8-23
Copyright © 2012 Pearson Education
The Internet and Government Invasions of Privacy
Various laws strengthen ability of law enforcement agencies to monitor Internet users without knowledge and sometimes without judicial oversight
CALEA,USAPATRIOTAct,CyberSecurityEnhancementAct,HomelandSecurityAct
Government agencies are largest users of private sector commercial data brokers, e.g., Experian and TransUnion
Retention of individual’s online behavior data by ISPs raises privacy concern
Slide 8-24
12
Copyright © 2012 Pearson Education
Legal Protections In United States, privacy rights explicitly
granted or derived from:Constitution
FirstAmendment—guaranteesfreedomofspeechandassociation
FourthAmendment—protectsagainstunreasonablesearchandseizureofone’spersonaldocumentsorhome
FourteenthAmendment—guaranteesdueprocessSpecificstatutesandregulations(federalandstate)
Commonlaw– courtdecisionsinvolvingwrongfulactsorpersonalinjuries
Slide 8-25
Copyright © 2012 Pearson Education
13
Copyright © 2012 Pearson Education
Copyright © 2012 Pearson Education
14
Copyright © 2012 Pearson Education
Informed Consent U.S. firms can gather and redistribute
transaction information without individual’s informed consent IllegalinEurope
Informed consent: Opt-in– requiresaffirmativeactionbyconsumertoallowcollectionanduseofinformation
Opt-out– defaulttocollectinformationunlessconsumertakesaffirmativeactiontopreventcollectionofdatabycheckingaboxorfillingoutform
ManyU.S.e-commercefirmsmerelypublishinformationpracticesaspartofprivacypolicywithoutprovidingforanyformofinformedconsent
Slide 8-29
Copyright © 2012 Pearson Education
The FTC’s Evolving Privacy Approach Fair Information Practice principles (1998)
Notice Choice Access Security Enforcement Restrictedcollection
New privacy framework (2010) Privacybydesign Simplifiedchoice Greatertransparency
Slide 8-30
15
Copyright © 2012 Pearson Education Slide 8-31
Copyright © 2012 Pearson Education Slide 8-32
Stre
ngth
en t
he F
IP’s
N
otifi
catio
n an
d Ch
oice
Adde
d to
th
e FI
P’s
16
Copyright © 2012 Pearson Education Slide 8-33
Copyright © 2012 Pearson Education Slide 8-34
17
Copyright © 2012 Pearson Education
The European Data Protection Directive
Privacy protection much stronger in Europe than United States
European approach: Comprehensiveandregulatoryinnature
European Commission’s Directive on Data Protection (1998): StandardizesandbroadensprivacyprotectioninEuropeanUnioncountries
Department of Commerce safe harbor program: ForU.S.firmsthatwishtocomplywithdirective
Slide 8-35
Copyright © 2012 Pearson Education
Private Industry Self-Regulation Safe harbor programs:
Private,self-regulatingpolicymechanismtomeetobjectivesofgovernmentregulationswithoutgovernmentinvolvement
e.g.,Privacysealprograms Industry associations include:
OnlinePrivacyAlliance(OPA) Encouragesself-regulationasareactiontogrowingpublicconcerns
Developedonline“seals”thatattesttoprivacypoliciesonasite E.g.,privacysealprograms(TRUSTe,BBBReliabilitySeal)
NetworkAdvertisingInitiative(NAI) Formedbyadvertisingnetworkindustry DevelopedprivacyprinciplesinconjunctionwithFTC MembersincludeDoubleClick,Advertising.com,and24/7RealMedia
CLEARAdNoticeTechnicalSpecificationsSlide 8-36
18
Copyright © 2012 Pearson Education
Private Industry Self-RegulationPrivacy advocacy groupsMonitordevelopmentsinprivacy
Emerging privacy protection businessE.g.,reputation.com,SocialShield,Abine
Slide 8-37
Copyright © 2012 Pearson Education
Technological Solutions Spyware blockers Pop-up blockers Secure e-mail Anonymous remailers, surfing Cookie managers Disk/file erasing programs Policy generators Privacy Policy Reader/P3P Public key encryption
(see next Fig.)Slide 8-39
19
Copyright © 2012 Pearson Education Slide 8-40
Copyright © 2012 Pearson Education
How P3P Works
Figure 8.2(A), Page 522 SOURCE: W3C Platform for Privacy Preferences Initiative, 2003.
20
Copyright © 2012 Pearson Education
Intellectual Property Rights
Intellectual property: Encompassesalltangibleandintangibleproductsofhumanmind
Major ethical issue: Howshouldwetreatpropertythatbelongstoothers?
Major social issue: IstherecontinuedvalueinprotectingintellectualpropertyintheInternetage?
Major political issue: HowcanInternetande-commerceberegulatedorgovernedtoprotectintellectualproperty?
Slide 8-43
Copyright © 2012 Pearson Education
Intellectual Property Protection
Three main types of protection: Copyright Patent Trademarklaw
Goal of intellectual property law: Balancetwocompetinginterests—publicandprivate
Maintaining this balance of interests is always challenged by the invention of new technologies
Slide 8-44
21
Copyright © 2012 Pearson Education
Copyright Protects original forms of expression (but not ideas) from
being copied by others for a period of time E.g., writings, art, drawings, and music 95-year protection for corporate-owned works, or life + 70-
year protection of individual’s works “Look and feel” copyright infringement lawsuits involve
distinction between an idea and its expression E.g.,ApplesuedMicrosoftandHPforinfringingApple’scopyrightonMacintoshinterface
Fair use doctrine : Under certain circumstances, permits use of copyrighted materials without permission (see next Fig.)
Digital Millennium Copyright Act, 1998 FirstmajorefforttoadjustcopyrightlawstoInternetage ImplementsWIPOtreatythatmakesitillegaltomake,distribute,orusedevicesthatcircumventtechnology-basedprotectionsofcopyrightedmaterials
Slide 8-45
Copyright © 2012 Pearson Education Slide 8-46
22
Copyright © 2012 Pearson Education Slide 8-47
Copyright © 2012 Pearson Education
Patents Grant owner 20-year monopoly on ideas behind an
invention Differentfromcopyrightssincepatentsprotectideaandnotjustexpressionofidea
Fourtypesofinventions: Machines,Man-madeproducts,Compositionsofmatter,Processingmethods
Inventionmustbenew,non-obvious,novel
Benefits Encouragesinventors Promotesdisseminationofnewtechniquesthroughlicensing
Danger Stiflescompetitionbyraisingbarrierstoentry
Slide 8-48
23
Copyright © 2012 Pearson Education
E-commerce Patents 1998 State Street Bank & Trust vs. Signature Financial
Group Businessmethodpatents
U.S. Patent Office, European Patent Convention hold different standards
Most European patent laws do not recognize business methods unless based on technology
Patent reform Patenttrolls:companiesthatbuypatentsonaspeculativebasisandthenusethemtothreatenothercompaniesviolatingthepatent
2011AmericaInventsActs Switchfrom“first-to-invent”to“first-to-file”system Newwaystochallengepatentsoutofcourt Allowstartupfirmstogetfast-trackconsiderationoftheirpatentapplications,within12months,ratherthan30-plusmonths
Slide 8-49
Copyright © 2012 Pearson Education
Internet and E-commerce Business Method Patents
Figure 8.2, Page 576 SOURCE: Based on data from United States Patent and Trademark Office, 2010.
Slide 8-50
24
Copyright © 2012 Pearson Education Slide 8-51
Copyright © 2012 Pearson Education Slide 8-52
25
Copyright © 2012 Pearson Education
Trademarks Identify, distinguish goods, and indicate their source Purpose
Ensureconsumergetswhatispaidfor/expectedtoreceive Protectowneragainstpiracyandmisappropriation
Infringement Marketconfusion:creatingconfusionwithexistingmarks,causesconsumerstomakemarketmistakes
Badfaith:intentionalmisuseofwordsandsymbolstoextortrevenuefromlegitimatetrademarkowners
Dilution Behaviorthatweakensconnectionbetweentrademarkandproduct Blurring– weakeningconnectionbetweentrademarkandgoods Tarnishment – usingtrademarkinawaythatmakesunderlyingproductsappearunsavoryorunwholesome
Slide 8-53
Copyright © 2012 Pearson Education
Trademarks and the Internet
Cybersquatting AnticybersquattingConsumerProtectionAct(ACPA)
Cyberpiracy Typosquatting
Metatagging Keywording Deep linking Framing
Slide 8-54
26
Copyright © 2012 Pearson Education Slide 8-55
Copyright © 2012 Pearson Education
Governance
Primary questionsWhowillcontrolInternetande-commerce?Whatelementswillbecontrolledandhow?
Stages of governance and e-commerceGovernmentControlPeriod(1970–1994)Privatization(1995–1998)Self-Regulation(1995–present)GovernmentRegulation(1998–present)
Slide 8-56
27
Copyright © 2012 Pearson Education Slide 8-57
Copyright © 2012 Pearson Education
Who Governs E-commerceand the Internet?
Currently: Mixed mode environment Self-regulation,throughvarietyofInternetpolicyandtechnicalbodies,co-existswithlimitedgovernmentregulation
ICANN : Domain Name System Internet could be easily controlled,
monitored, and regulated from a central location , e.g., network access points, routers, and servers (e.g., China, Singapore, Thailand etc.)
Slide 8-58
28
Copyright © 2012 Pearson Education
Taxation E-commerce taxation illustrates complexity of
governance and jurisdiction issues U.S. sales taxed by states and local government MOTO retailing E-commerce benefits from tax “subsidy” October 2007: Congress extends tax moratorium for
an additional seven years Unlikely that comprehensive, integrated rational
approach to taxation issue will be determined for some time to come
Slide 8-59
Copyright © 2012 Pearson Education
Net Neutrality Neutrality: All Internet traffic treated
equally—all activities charged the same rate, no preferential assignment of bandwidth
Backbone providers vs. content providers December 2010 FCC approved “compromise” net
neutrality rules; prohibit ISPs from blocking traffic such as Skype on wired networks, and prohibit “unreasonable” discrimination on such networks
Telecom providers adopting compromise position between wired and mobile wireless access: maintain existing rules for land lines, but implement differential pricing for mobile wireless networks, e.g., $15/month for 200MB of data to $45/month for 4GB
Slide 8-60
29
Copyright © 2012 Pearson Education
Public Safety and Welfare
Protection of children and strong sentiments against pornographyPassinglegislationthatwillsurvivecourtchallengeshasproveddifficult
Efforts to control gambling and restrict sales of drugs and cigarettesCurrently,mostlyregulatedbystatelawUnlawfulInternetGamblingEnforcementAct
Slide 8-61
Copyright © 2012 Pearson Education Slide 8-63