Legal, Ethical, and Social Impacts of EC

Ethics: The branch of philosophy that deals with what is considered to be right and wrong What is unethical is not necessarily

illegal Ethics are supported by common

agreement in a society as to what is right and wrong, but they are not subject to legal sanctions

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EC ethical issues Non-work-related use of the

Internet▪ Employees use e-mail and the Web for non-

work-related purposes▪ The time employees waste while surfing non-

work-related Web sites during working hours is a concern

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Corporate code of ethics▪ Issue written policy guidelines▪ Copyrighted trademarked material

cannot be used without permission▪ Post disclaimers concerning content▪ Post disclaimers of responsibility

concerning content of online forums and chat sessions

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▪ Make sure that Web content and activity comply with the laws in other countries▪ Make sure that the company’s Web content

policy is consistent with other company policies▪ Appoint someone to monitor Internet legal

and liability issues▪ Have attorneys review Web content to make

sure that there is nothing unethical, or illegal, on the company’s Web site

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Major ethical/legal issues Privacy Intellectual property rights Free speech versus censorship Consumer and merchant protection

against fraud

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Privacy: The right to be left alone and the right to be free of unreasonable personal intrusions

1. The right of privacy is not absolute. Privacy must be balanced against the needs of society

2. The public’s right to know is superior to the individual’s right of privacy

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Web site registration Most B2C and marketing Web sites

ask visitors to fill out registration forms including:▪ names▪ addresses▪ phone numbers▪ e-mail addresses▪ hobbies, etc.

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There are few restraints on the ways in which the site can use this information▪ Use it to improve customer service or its own

business▪ Or sell the information to another company

that could use it in an inappropriate or intrusive manner

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Cookie: A small piece of data that is passed back and forth between a Web site and an end user’s browser as the user navigates the site; enables sites to keep track of users’ activities without asking for identification

Users can protect themselves against cookies:

▪ delete them from their computers

▪ use anticookie software

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Privacy of employees Monitoring employees’ e-mail and

Web activities▪ wasting time▪ may disclose trade secrets

77% of companies monitor their employees’ communications

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Protection of privacy Notice/awareness Choice/consent Access/participation Integrity/security Enforcement/redress

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Opt-out clause: Agreement that requires computer users to take specific steps to prevent collection of information

Opt-in clause: Agreement that requires computer users to take specific steps to allow collection of information

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Intellectual property: Creations of the mind, such as inventions, literary and artistic works, and symbols, names, images, and designs used in commerce

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Copyright: An exclusive grant from the government that allows the owner to reproduce a work, in whole or in part, and to distribute, perform, or display it to the public in any form or manner, including the Internet

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Copyright protection approaches Using software to produce digital

content that cannot be copied▪ Cryptography ▪ Tracking copyright violations

Digital watermarks: Unique identifiers imbedded in digital content that make it possible to identify pirated works

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Trademark: A symbol used by businesses to identify their goods and services; government registration of the trademark confers exclusive legal right to its use

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The owner of a registered trademark has exclusive rights to: Use the trademark on goods and

services for which the trademark is registered

Take legal action to prevent anyone else from using the trademark without consent on goods and services (identical or similar) for which the trademark is registered

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Domain name refers to the upper category of an Internet address (URL)▪ Should additional (new) top-level domain

names be added?▪ The use of trademarked names that belong to

other companies as domain names

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Domain name disputes and resolutions▪ Major disputes are international in scope,

because the same corporate name may be used in different countries by different corporations▪ Internet community now quickly resolves

domain name disputes using arbitration

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Cybersquatting: The practice of registering domain names in order to sell them later at a higher price

Anticybersquatting Consumer Protection Act of 1999 allows trademark owners sue for statutory damages▪ Juliaroberts.com▪ Madonna.com

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Patent: A document that grants the holder exclusive rights on an invention for a fixed number of years Patents serve to protect tangible

technological inventions Patents are not designed to protect

artistic or literary creativity Patents confer monopoly rights to

an idea or an invention, regardless of how it may be expressed

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Fraud on the Internet Online auction fraud—87% of online

crime Internet stock fraud—spread false

positive rumors about the prospects of companies

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Consumer protection—tips for safe electronic shopping Make sure that they enter the real

Web site of well-known companies Search any unfamiliar site for an

address and telephone and fax numbers and call

Check out the seller with the local chamber of commerce, BBB, or TRUSTe

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Investigate how secure and organized the seller’s site is

Examine the money-back guarantees, warranties, etc.

Compare prices online to those in regular stores

Ask friends what they know, look for testimonials and endorsements

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Find out what redress is available in case of a dispute

Consult the National Fraud Information Center (fraud.org)

Check the resources available at consumerworld.org

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Authentication and biometric controls provide▪ Access procedures that match every valid

user with a unique user identifier (UID)▪ Authentication method that verifies that users

requesting access to the computer system are really who they claim to be▪ Are valid for both consumer and merchant

protection

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Digital divide: The gap between those who have and those who do not have the ability to access electronic technology in general, and the Internet and EC in particular

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Other societal issues Education▪ Virtual universities▪ Companies use the Internet to retrain

employees▪ Home-bound individuals can get degrees

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Public safety and criminal justice▪ e-911 systems▪ collaborative commerce▪ e-procurement▪ e-government—coordinating, information

sharing, and expediting legal work and cases▪ intelligent homes, offices, and public

buildings▪ e-training of law enforcement officers

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Health aspects▪ safer and healthier to shop from home than

to shop in a physical store▪ some believe that exposure to cellular mobile

communication radiation may cause health problems▪ collaborative commerce can help improve

health care

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