1. Copyright © 2002 Pearson Education, Inc.

2. Ethical, Social, and Political Issues in E-commerce
CHAPTER 9
Ethical, Social, and Political Issues in E-commerce
Created by, David Zolzer, Northwestern State University—Louisiana
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3. 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
Identify the practices of e-commerce companies that threaten privacy
Understand basic concepts related to privacy
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4. Learning Objectives
Describe the different methods used to protect online privacy
Understand the various forms of intellectual property and the challenge of 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
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5. Unique Features of E-commerce Technology and Their Potential Ethical, Social, and/or Political Implications
Page 456,
Table 9.1
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6. Ethical, Social, and Political Issues
Information Rights
What rights to their own personal information do individuals have in a public marketplace, or in their private homes, when Internet technology makes information collection so pervasive and efficient?
What rights do individuals have to access information about business firms and other organizations?
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7. Ethical, Social, and Political Issues
Property Rights
How can traditional intellectual property rights be enforced in the Internet world where perfect copies of protected works can be made and easily distributed worldwide in seconds?
Governance
Should the Internet and e-commerce be subject to public laws?
If so, what law-making bodies have jurisdiction -- state, federal, and/or international?
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8. Ethical, Social, and Political Issues
Public Safety and Welfare
What efforts should be undertaken to ensure equitable access to the Internet and e-commerce channels?
Should governments be responsible for ensuring that schools and colleges have access to the Internet?
Is certain online content and activities -- such as pornography and gambling -- a threat to public safety and welfare?
Should mobile commerce be allowed from moving vehicles?
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9. The Moral Dimensions of an Internet Society
Page 458,
Figure 9.1
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10. Basic Ethical Concepts
Ethics is the study of principles that individuals and organizations can use to determine right and wrong courses of action
Responsibility means that as free moral agents, individuals, organizations, and societies are responsible for the actions they take
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11. Basic Ethical Concepts
Accountability means that individuals, organizations, and societies should be held accountable to other for the consequences of their actions
Liability is a feature of political systems in which a body of law is in place that permits individuals to recover the damages done to them by other actors, systems, or organizations
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12. Basic Ethical Concepts
Due process is a feature of law-governed societies and refers to a process in which laws are known and understood and there is an ability to appeal to higher authorities to ensure that laws have been applied correctly
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13. Analyzing Ethical Dilemmas
Dilemma is a situation is which there are at least two diametrically opposed actions, each of which supports a desirable outcome
Use a five-step process to analyze a dilemma
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14. Analyzing Ethical Dilemmas
Identify and describe clearly the facts
Find out who did what to whom, and where, when, and how.
Define the conflict or dilemma and identify the higher-order values
Ethical, social, and political issues always reference higher values
The parties to a dispute all claim to be pursuing higher values
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15. Analyzing Ethical Dilemmas
Identify the stakeholders
Every ethical, social, and political issues has stakeholders: players in the game who have an interest in the outcome, who have invested in the situation, and usually have vocal opinions
Find out the identity of these groups and what they want
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16. Analyzing Ethical Dilemmas
Identify the options that you can reasonably take
None of the options may satisfy all interests involved
Some options do a better job than others
Arriving at a “good” or ethical solution may not always be a balancing of consequences to stakeholders
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17. Candidate Ethical Principles
The Golden Rule
Do unto others as you would have them do unto you.
Putting yourself in place of others and thinking of yourself as the object of the decision can help you think about fairness in decision making
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18. Candidate Ethical Principles
Universalism
If an action is not right for all situations, then it is not right for any specific situation
Ask yourself, “If we adapted this rule in every case, could the organization, or society, survive?”
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19. Candidate Ethical Principles
Slippery Slopes
If an action cannot be taken repeatedly, then it is not right to take at all
An action may appear to work in one instance to solve a problem, but if repeated, would result is a negative outcome
“Once started down a slippery path, you may not be able to stop.”
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20. Candidate Ethical Principles
Collective Utilitarian Principle
Take the action that achieves the greater value for all of society
This rule assumes you can prioritize values in a rank order and understand the consequences of various courses of action
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21. Candidate Ethical Principles
Risk Aversion
Take the action that produces the least harm, or the least potential cost.
Some actions have extremely high failure costs of a very low probability or extremely high failure costs of moderate probability
Avoid high-failure cost actions and choose actions whose consequences would not be catastrophic, even if there were a failure
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22. Candidate Ethical Principles
No Free Lunch
Assume that virtually all tangible and intangible objects are owned by someone else unless there is a specific declaration otherwise
If something someone else has created is useful to you, it has value and you should assume the creator wants compensation for this work
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23. Candidate Ethical Principles
The New York Times Test (Perfect Information Rule)
Assume that the results of you decision on a matter will be the subject of a lead article in the New York Times the next day
Will the reaction of readers be positive or negative?
Would you parents, friends, and children be proud of your decisions
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24. Candidate Ethical Principles
The Social Contract Rule
Would you like to live in a society where the principle you are supporting would become an organizing principle of the entire society?
You might think it is wonderful to download illegal copies of music tracks, but you might not want live in a society that did not respect property rights, such as your property rights to the car in your driveway, or your rights to a term paper or original art
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25. Information Collected at E-commerce Sites
Personally identifiable Information (PII) is any data that can be used to identify, locate, or contact an individual
Anonymous information is demographic and behavioral information that does not include any personal identifiers
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26. Profiling: Privacy and Advertising Networks
Profiling is the creation of digital images that characterize online individual and group behavior
Anonymous profiles identify people as belonging to highly specific and targeted groups
Personal profiles add a personal address, postal address, and/or phone number to behavioral data
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27. Personal Information Collected by E-commerce Sites
Page 463, Table 9.2
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28. The Internet’s Major Personally Identifiable Information Gathering Tools
Page 464, Table 9.3
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29. The Concept of Privacy
Privacy is the moral right of individuals to be left alone, free from surveillance or interference from other individuals or organizations, including the state
Information privacy includes both the claim that certain information should not be collected at all by governments or business firms, and the claim of individuals to control the use of whatever information that is collected about them
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30. The Concept of Privacy
Informed consent is consent given with knowledge of all material facts needed to make a rational decision
Opt-in requires and affirmative action by the consumer to allow collection and use of consumer information
Opt-out -- the default is to collect information unless the consumer takes and affirmative action to prevent the collection of data
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31. Excerpts from KMart’s BlueLight.com Privacy Policy
Page 469, Table 9.4
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32. Federal Privacy Laws Page 471, Table 9.5
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33. Federal Trade Commission Fair Information Practice Principles
Page 472, Table 9.6
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34. FTC Recommendations Regarding Online Profiling
Page 473,
Table 9.7
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35. Summary of Proposed e-commerce Privacy Legislation in 2001
Page 474, Table 9.8
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36. Private Industry Self-Regulation
Safe harbor is a private self-regulating policy and enforcement mechanism that meets the objectives of government regulators and legislation but does not involve government regulations or enforcement
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37. Percentage of Web Sites with Privacy Seals
Page 475, Figure 9.2
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38. A Summary of DoubleClick’s Privacy Policy
Page 477, Table 9.9
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39. Privacy Advocacy Groups
Page 479, Table 9.10
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40. Technological Solutions to Privacy Invasion on the Web
P3P (Platform for Privacy Preferences) is a standard designed to communicate to Internet users a Web site’s privacy policy, and to compare that policy to the user’s own preferences, or to other standards such as the FTC’s FIP guidelines or the EU Data Protection Directive
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41. Technological Protections for Online Privacy
Page 480, Table 9.11
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42. How P3P Works Page 481, Figure 9.3
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43. Intellectual Property Rights
Congress shall have the power to “promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writing and discoveries.”
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44. Copyright: The Problem of Perfect Copies and Encryption
Copyright law protects original forms of expression such as writings, art, drawings, photographs, music, motion pictures, performances, and computer programs from being copied by others for a minimum of 50 years
“Look and feel” copyright infringement lawsuits are precisely about the distinction between and idea and its expression
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45. Copyright: The Problem of Perfect Copies and Encryption
Doctrine of fair use permits teachers and writers to use copyrighted materials with permission under certain circumstances
Digital Millennium Copyright Act (DMCA) of 1998 is the first major effort to adjust the copyright laws to the Internet age
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46. Fair Use Considerations to Copyright Protection
Page 486, Table 9.12
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47. The Digital Millennium Copyright Act
Page 487, Table 9.13
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48. Patents: Business Methods and Processes
“Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefore, subject to the conditions and requirements of this title.”
Patent grants the owner an exclusive monopoly to the ideas behind an invention for 20 years
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49. Explosion of Internet and E-commerce Patents
Page 490, Figure 9.4
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50. Selected E-commerce Business Methods Patents
Page 492,Table 9.14
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51. Trademarks: Online Infringement and Dilution
Trademark is “any work, name, symbol, or device, or any combination there of … used in commerce … to identify and distinguish … goods … from those manufactured or sold by others and to indicate the source of the goods.”
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52. Trademarks: Online Infringement and Dilution
Trademark -- a mark used to identify and distinguish goods and indicate their source
Dilution is any behavior that would weaken the connection between the trademark and the product
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53. Trademarks and the Internet
Anticybersquatting Consumer Protection Act (ACPA) creates civil liabilities for anyone who attempts in bad faith to profit from an existing famous or distinctive trademark by registering an Internet domain name that is identical, or confusingly similar, or “dilutive” of that trademark
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54. Trademarks and the Internet
Cybersquatting involves the registration of an infringing domain name, or other Internet use of an existing trademark, for the purpose of extorting payments from the legitimate owners
Cyberpiracy involves the same behaviour as cybersquatting, but with the intent of diverting traffic from the legitimate site to an infringing site
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55. Internet and Trademark Law
Page 495,
Table 9.15
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56. Trademarks and the Internet
The use of trademarks in metatags is permitted if the use does not mislead or confuse consumers
The permissibility of using trademarks as keywords on search engines is also subtle and depends both on the extent to which such use causes “initial customer confusion” and the content of the search results
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57. Trademarks and the Internet
Linking refers to building hypertext links from one site to another site
Deep linking involves bypassing the target site’s home page, and going directly to a content page
Framing involves displaying the content of another Web site inside your own Web site within a frame or window
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58. Governance
Governance has to do with social control: Who will control e-commerce, what elements will be controlled, and how will the controls be implemented?
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59. The Evolution of Governance of E-commerce
Page 500, Table 9.16
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60. Public Government and Law
Taxation illustrates the complexity of governance and jurisdiction of e-commerce
In both Europe and the United States, governments rely on sales taxes based on the type and value of goods sold
There is no integrated rational approach to taxation of domestic or international e-commerce
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61. Public Safety and Welfare
Electronic media of all kinds have historically been regulated by governments
Critical issues in e-commerce center around the protection of children, strong sentiments against pornography in public media, efforts to control gambling, and the protection of public health through restricting sales of drugs and cigarettes
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62. Protecting Children
Communications Decency Act (1996) makes it a felony criminal offence to use any telecommunications device to transmit “any comment, request, suggestion, proposal, image or other communications which is obscene, lewd, lascivious, filthy, or indecent” to anyone, and in particular, to persons under the age of 18 years of age
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63. Protecting Children
Children’s Online Protection Act (1998) made it a felony criminal offense to communicate for “commercial purposes” “any material harmful to minors”
Private pressure from organized groups has also been successful in forcing some Web sites to eliminate the display of pornographic materials
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64. Gambling, Cigarettes, and Drugs
It is unclear if online gambling is illegal under U.S. federal law
Most online gambling sites are located offshore in Costa Rica or Antigua
Geolocation software attempts to identify the geographical location of Web users
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65. Equity and the Digital Divide
The Digital Divide refers to the large differences in Internet access and e-commerce access among income, ethnic, and age groups.
Lack of such access affects the ability of children to improve their learning with educational software, of adults to acquire valuable technology skills, and of families to benefit from online connections to important health and civic information
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