Essentials of MIS, 11e

Laudon & Laudon

Lecture Notes

Chapter 4 Ethical and Social Issues in Information Systems

It probably goes without saying that the security and ethical issues raised by the Information Age, and
specifically the Internet, are the most explosive to face our society in decades. It will be many years and many
court battles before socially acceptable policies and practices are in place.

You say to yourself, “Hey I don’t really care about my online privacy. Nobody will ever care about what I do
or where I go on the Internet.” Well, you might want to think twice about that.

A real estate broker sought to bury a negative review that a client posted online after a home
buying experience. A banking executive looked to de-emphasize content from Google search
results about a convict who shared his name. A woman new to the dating scene wanted to
remove some painful references to her online divorce records.

The stakes can be high for job seekers—especially those who may be concerned about what
potential employers would see on their online profile. A recent Microsoft Corp. study reported
that 78 percent of recruiters and human resources professionals used online search engines to
screen applicants, while 63 percent looked at social networking sites when researching job
candidates.

Last week, for example, the Cohasset School Committee asked a teacher to resign after she
posted comments on Facebook that called residents of the South Shore town snobby and
arrogant. (“For a fee, digital dirt can be buried,” Boston Globe, Diaz, Johnny, Aug 26, 2010)

Ethical, social, and privacy issues are important to everyone.

4.1 Understanding Ethical and Social Issues Related to Systems

You may love the idea that a gardening Web site or a mail order catalog gives you information about what
grows best in your backyard (literally your backyard). You might even love the idea that you can sign on to
Amazon.com, have the Web site greet you by name, and supply you with information about a book or CD by
your favorite author or artist. If you’re not especially interested in Stephen King or Frank Sinatra, don’t worry;
Amazon.com knows that and won’t bother you with products from those artists.

You are 22 years old, drive a Mazda, like hip-hop music, shop at Macy’s at least once a month around the 15 th,
wear a size 10 dress, live in a small two-bedroom apartment, have friends or relatives who live in Texas, like
eating at Red Lobster, go on a skiing trip to Colorado every Spring Break, missed one semester of school last
year due to medical problems, and spend lots of time on your Facebook page. Would it surprise you to know
that this information and more can all be gleaned from various computer records?

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A lot of personal information about us has always been available, just not as easily and as readily as today.
Massive databases maintained by commercial companies and governments at all levels now allow profiling like
that above to be accomplished easier and faster than ever before.

The information that companies gather is anonymous, in the sense that Internet users are
identified by a number assigned to their computer, not by a specific person’s name. Lotame
[Lotame Solutions, Inc., a New York company that specialize in data capture], for instance, says
it doesn’t know the name of users—only their behavior and attributes, identified by code
number. (“The Web’s New Gold Mine: Your Secrets,” The Wall Street Journal, Angwin, Julia,
July 30, 2010)

Even though the Internet is about 40 years old and the World Wide Web is close to 20 years old, our society is
just beginning to address the ethical issues and dilemmas raised by these technological advances. It’s difficult to
measure one person’s ethics against another person’s desire to make money or wreak havoc that’s made much
easier by the Internet. Even though the U.S. government has passed some laws to control criminal behavior and
ethical issues associated with the Internet, it’s difficult to stay one step ahead of the ever-changing technology.

A Model for Thinking About Ethical, Social, and Political Issues

Many of these issues not only touch our society as a whole, but also raise lots of questions for organizations,
companies, and the workplace in general. We hear arguments for free speech, personal responsibility, and
corporate responsibility. There are discussions about the government’s role in all this. At the beginning of
Chapter 4, Laudon says: “Suddenly individual actors are confronted with new situations often not covered by
the old rules. Social institutions cannot respond overnight to these ripples.... Political institutions also require
time before developing new laws and often require the demonstration of real harm before they act. In the
meantime, you may have to act. You may be forced to act in a legal ‘gray area.’”

How you act, individually and as groups, in this gray area may well define the future of our society. Though
that may sound a bit dramatic, you must understand that you are part of the development of “acceptable usage”
of this new medium and will help define the direction in which it goes.

Figure 4.1: The Relationship Between Ethical, Social, and Political Issues in an Information Society

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Figure 4.1 shows the relationship between ethical, social, and political issues in an information society. You
could change this diagram somewhat to avoid the impression that the five dimensions are separate. You’d show
significant overlap of each area, and most of the diagram would be in shades of gray.

Five Moral Dimensions of the Information Age

The five dimensions we’ll discuss are: information rights and obligations, property rights and obligations,
accountability and control, system quality, and the quality of life. They all apply in today’s business
environment. Although these dimensions have existed in some form or another for years, they are made more
important with the technological advances we’ve seen in the last ten years.

Key Technology Trends that Raise Ethical Issues

Information technologies pose problems and threats to established societal rules, and technological advances
pose new situations and possible threats to privacy and ethics.

Table 4.2: Technology Trends that Raise Ethical Issues

In addition to the technologies described in Table 4.2, you need to understand the most recent technological
threats to your privacy in cyberspace:

1. The federal government is asking the U.S. Supreme Court to decide if law enforcement officials should
be allowed to search cell phones of criminal suspects without first obtaining search warrants. The
Department of Justice maintains that first having to apply and receive a search warrant could slow down
their ability to prosecute criminals. The First Circuit Court of Appeals previously ruled that police are
required to obtain search warrants before searching cell phones. The U.S. Constitution, Fourth
Amendment forbids warrantless searches of U.S. citizens.
2. Google’s “Street View” is a controversial mapping tool that has allowed Google to capture Wi-Fi
signals in addition to street level imagery in thirty countries over a three-year period. Google obtained
Wi-Fi data, including email passwords and content, from receivers that were concealed in the Street
View vehicles. Many countries and several U.S. states are currently investigating Google Street View.
In May, EPIC urged the Federal Communications Commission to open an investigation into Street
View, as Google’s practices appear to violate U.S. federal wiretap laws as well as the U.S.
Communications Act. (www.epic.org)
3. In Foltz v. Virginia, the Virginia Court of Appeals held that law enforcement may place a GPS tracking
device on a vehicle without violating the Fourth Amendment. The Court found that the defendant did
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not have an expectation of privacy, and therefore attaching the tracking device to the bumper did not
require a warrant. (www.epic.org)
4. New handheld Web appliances will allow businesses to track your physical whereabouts and offer you
discounts and special offers depending on your geographic location. As you walk down a city street,
you’ll be notified that the restaurant two blocks away has an open table waiting just for you.
5. Chairman Leahy Announces New Subcommittee on Privacy and Technology: Sen. Patrick Leahy (D-
VT), Chairman of the Senate Judiciary Committee, has established a new Subcommittee on Privacy,
Technology and the Law as part of his commitment to protecting “Americans’ privacy in the digital
age.” Sen. Al Franken (D-MN) will chair the subcommittee, which will cover privacy laws and policies,
new business practices, social networking sites, privacy standards, and the privacy implications of
emerging technologies. For related information, see EPIC: Social Networking Privacy, EPIC: Cloud
Computing. (Feb. 16, 2011)
6. Federal Trade Commission Announces Settlement in EPIC Facebook Privacy Complaint: The Federal
Trade Commission has announced an agreement with Facebook that follows from complaints filed by
EPIC and other consumer and privacy organizations in 2009 and 2010. In 2009, EPIC first asked the
FTC to investigate Facebook’s decision to change its users’ privacy settings in a way that made users’
personal information, such as Friend lists and application usage data, more widely available to the
public and to Facebook’s business partners. The violations are also detailed in the FTC’s 8-count
complaint against the company. The proposed settlement agreement bars Facebook from making future
changes to privacy settings without the affirmative consent of users and requires the company to
implement a comprehensive privacy protection program and submit to independent privacy audits for 20
years. The settlement does not adopt EPIC’s recommendation that Facebook restore users’ privacy
settings to pre-2009 levels. Facebook CEO Mark Zuckerberg reacted to the settlement in a post on
Facebook’s blog, saying that he was the “first to admit that we’ve made a bunch of mistakes.” For more
information, see EPIC: In re Facebook, and EPIC: Federal Trade Commission. (Nov. 29, 2011)

A few of the news items in the list above came from a Web site maintained by the Electronic Privacy
Information Center (www.epic.org), an organization devoted to privacy issues associated with the use of new
technologies tied to networks in general, and the Internet specifically. It is one of the premier organizations
dedicated to preserving the privacy of the American citizen. If you haven’t visited the Web site you should.

The scenario at the beginning of this section about profiling is possible through the technique called data
mining. Add to that the capabilities of nonobvious relationship awareness (NORA) data analysis technology,
as shown in Figure 4.2, and complete strangers might know just as much about you as you do. It can and has
been done. So you should be concerned and you should care.

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Figure 4.2: Nonobvious Relationship Awareness (NORA)

The investment arms of the CIA and Google are both backing a company that monitors the web
in real time—and says it uses that information to predict the future.

The company is called Recorded Future, and it scours tens of thousands of websites, blogs and
Twitter accounts to find the relationships between people, organizations, actions and incidents—
both present and still-to-come. In a white paper, the company says its temporal analytics engine
“goes beyond search” by “looking at the ‘invisible links’ between documents that talk about the
same, or related, entities and events.”

The idea is to figure out for each incident who was involved, where it happened and when it
might go down. Recorded Future then plots that chatter, showing online “momentum” for any
given event.

“The cool thing is, you can actually predict the curve, in many cases,” says company CEO
Christopher Ahlberg, a former Swedish Army Ranger with a PhD in computer science.

“We’re right there as it happens,” Ahlberg told Danger Room as he clicked through a
demonstration. “We can assemble actual real-time dossiers on people.” (“Google, CIA Invest in
‘Future’ of Web Monitoring,” Wired.com, Shachtman, Noah, July 28, 2010)

The data-gathering activities of the U.S. government, Internet Service Providers and other technology
companies were splashed across front page headlines in June 2013 when Edward Snowden revealed
details about the National Security Agency (NSA) PRISM program. Regardless of whether Snowden
ultimately is declared a traitor or a hero, one thing is for sure: your data are gathered wherever you go
and whatever you do online and on the telephone.

Since the Guardian and The Washington Post revealed the existence of the NSA’s PRISM
program last week, there’s been a confusing debate about what exactly the program is and how it
works. While the Obama administration has tacitly acknowledged the program’s existence, tech
companies have angrily denied that they had given the NSA “direct” or “unfettered” access to
their servers.

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We know that PRISM is a system the NSA uses to gain access to the private communications of
users of nine popular Internet services. We know that access is governed by Section 702 of the
Foreign Intelligence Surveillance Act, which was enacted in 2008. Director of National
Intelligence James Clapper tacitly admitted PRISM’s existence in a blog post last Thursday. A
classified PowerPoint presentation leaked by Edward Snowden states that PRISM enables
“collection directly from the servers” of Microsoft, Yahoo, Google, Facebook and other online
companies.

What do the Internet companies who allegedly participate in this program have to say
about it?

In a Friday post titled “What the …?” Google CEO Larry Page stated that “any suggestion that
Google is disclosing information about our users’ Internet activity on such a scale is completely
false.”

In a weekend follow-up, Google chief architect Yonatan Zunger wrote that “the only way in
which Google reveals information about users are when we receive lawful, specific orders about
individuals.” He said that “it would have been challenging—not impossible, but definitely a
major surprise—if something like this could have been done without my ever hearing of it.” He
said that even if he couldn’t talk about such a program publicly, he would have quit Google
rather than participate. “We didn’t fight the Cold War just so we could rebuild the Stasi
ourselves,” he concluded.

“The notion that Yahoo! gives any federal agency vast or unfettered access to our users’ records
is categorically false,” wrote Yahoo’s Ron Bell on Saturday. “Of the hundreds of millions of
users we serve, an infinitesimal percentage will ever be the subject of a government data
collection directive.”

The Times says that major tech companies have systems that “involve access to data under
individual FISA requests. And in some cases, the data is transmitted to the government
electronically, using a company’s servers.” (Washington Post.com, “Here’s everything we know
about PRISM to date,” Timothy B. Lee,
http://www.washingtonpost.com/blogs/wonkblog/wp/2013/06/12/heres-everything-we-know-
about-prism-to-date/, June 12, 2013.)

Bottom Line: Technological trends are posing new situations and questions we haven’t had to deal with
before. As it’s your world and your future, you should be concerned and become involved in their
resolution.

4.2 Ethics in an Information Society

Did you ever hear the old warning: “Just because you can, doesn’t mean you should?” Well, a lot of things are
possible on the Internet nowadays, but that doesn’t mean you should do them.

Ethics is easily managed in small groups because the group itself tends to control the individual’s behavior. It’s
referred to as “self-policing.” The larger the group, the harder it is to manage the actions of individuals. Now

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stretch that to a huge number of people with many frames of reference and experiences. Responsibility to the
group becomes harder to police and accountability for an individual’s actions is harder to enforce.

Basic Concepts: Responsibility, Accountability, and Liability

Every action causes a reaction. When you’re using the Internet, computers on campus, or your employer’s
computer, you should be aware of the following:

 Responsibility: Accepting potential costs, duties, and obligations for your decisions.
 Accountability: Determining who should take responsibility for decisions and actions.
 Liability: Legally placing responsibility with a person or group.
 Due Process: ensuring the laws are applied fairly and correctly.

Responsibility, accountability, and liability are all yours when it comes to your actions in cyberspace. Every
Internet Service Provider has a “usage policy,” even the so-called anonymous emailers that hide your real
identity. Hotmail is a popular Internet email service that allows you to mask your real identity. You could send
out all the, shall we say unethical, threatening, nasty, aberrant email you like. You think: “Hey, no one will
really know who I am. This is cool.”

And then here comes the message from Hotmail to cease and desist. Your free email account is cancelled
because you violated Hotmail’s usage policy. Then your local Internet Service Provider contacts you and tells
you you’re terminated, baby! You violated its usage policy by your actions. By now you’re really mad, not to
mention embarrassed (at least we hope so). It’s true. It happens.

Just because you think you can, doesn’t mean you should. Would you stand in the middle of campus and shout
insults? Laudon and Laudon point out, “Using information technology in a socially responsible manner means
that you can and will be held accountable for the consequences of your actions.” Just as you are subject to rules,
whether you like them or not, on Main Street, USA, in public, you are subject to societal rules in cyberspace.
Anonymity isn’t a license for socially unacceptable behavior.

Some people seem to absolve themselves of responsibility by putting the onus on the computer—“Hey, the
computer screwed up,” or “Because it was an anonymous username I didn’t think I’d get caught.” It just
doesn’t work that way in society—face-to-face or on the Internet. No one can hide behind the technology.
Humans control the computers, not the other way around.

And if you have received threatening, aberrant emails or flames in chatroom or discussion groups, and haven’t
reported them according to the usage policies, you may be as much a part of the problem as the perpetrator!

Ethical Analysis

It’s safe to say you’ll find yourself in situations where your ethics are continually challenged online and offline.
What should you do? Try the following:

 Separate fact from fiction.

 Remember, no matter how thin you slice it, there’s always two sides.
 Determine who’s really involved.
 Compromise; it doesn’t always have to be an “either–or” outcome.

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 Anticipate the outcome; it will help you devise better solutions.

You should study the ethical principles outlined in the text, as we’ll be incorporating them into the discussions
throughout the remainder of this chapter.

Candidate Ethical Principles

In the early days of the Internet, just about anything was acceptable. The phrase “Wild Wild Web” was an
appropriate cliché. But as the technology becomes more mainstream, the less wild it becomes.

The principles listed in the text are deeply rooted in cultures around the world. We seriously doubt the authors
of these guidelines had the Internet in mind when they developed them. But, when you think about it, they
work nicely, even in cyberspace!

1. Do unto others as you would have them do unto you

2. If an action is not right for everyone, perhaps it’s not right for anyone
3. If an action cannot be taken repeatedly, it is not right to take at all.
4. Take the action that achieves the higher or greater value
5. Take the action that produces the least harm or the least potential cost
6. Assume that virtually all tangible and intangible objects are owned by someone else unless there is a
specific declaration otherwise.

Professional Codes of Conduct

Most professional organizations have a code of conduct by which they expect their members to abide. The
Association of Computing Machinery (www.acm.org) has an excellent set of standards that apply to all of us,
whether we belong to ACM or not.

Some Real-World Ethical Dilemmas

Individuals, companies, and corporations are being forced to deal with these new ethical and social issues in
ways never before imagined. Employ the ethical analysis we just discussed to the real-world situations
presented here and in the text.

No issue has been harder for organizations to deal with than that of e-mail. Should companies be
allowed to read employees’ e-mails, especially if they are personal? Should employees be allowed to
send personal e-mails to begin with? Should e-mails be used against a person or company in a court of
law. If so, how? A recent example of this issue is the Microsoft versus Department of Justice antitrust
trial. Many e-mails written by Microsoft’s executives have been used against them. E-mails are not as
anonymous as people think—“Sending an e-mail message is more like sending a postcard than sending
a sealed envelope.” (CNN Headline News, April 28, 1996)

So in your opinion, what is right? Is it okay for an employee to download the latest picture from Playgirl’s Web
site and use it as a screensaver? Is it okay to run a personal commercial Web site from your workplace
computer using the company’s computer resources? Is it okay to email discriminatory jokes over the company’s
network that wouldn’t be allowed over the water cooler? Is it okay to make a Facebook posting telling everyone
that the boss is a jerk, then get mad when the company fires you?

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Is it okay for the company to use technology to monitor your computer usage every minute you’re on the job?
Is it okay for the company to use technology to monitor your keystrokes so they can determine how much work
you’re doing?

What if Susie is using her computer to surf gardening Web sites three hours a day while you have to do her
work? What if Joe and Sam play the newest Internet game during their coffee break every morning and
afternoon, which bogs down the entire company’s network?

What is the best way for companies and employees to handle these situations? What is the right thing to do?

Bottom Line: Ethics in an information society holds each person responsible for his or her actions. Each
person is accountable for everything he or she does, no matter how anonymous the action may seem.
Each person is liable for the consequences his or her actions may inflict on other people and society as a
whole.

4.3 The Moral Dimensions of Information Systems

This section examines the five moral dimensions (information rights; property rights; accountability, liability,
and control; system quality; and the quality of life) by asking you to examine them from a personal standpoint.

Information Rights: Privacy and Freedom in the Internet Age

Many of us take our privacy and freedom for granted. You should be aware of how technology is changing and
challenging our basic assumptions about these issues.

Video rental records are more protected from misuse and prying than are some of your financial records. We all
assume that the Constitution guarantees our personal privacy and freedom from surveillance. If someone set up
a video camera inside your dorm room or on your front porch to monitor your every movement, what would
you do? In some cases, that’s similar to what happens when you access some Web sites. So how do we protect
our privacy and freedom from surveillance in a high-tech world?

The text provides some information regarding privacy rights protected by law and established practices. But
before you jump up and say, “Hey, the Privacy Act of 1974 says you can’t spy on me,” remember that law only
applies to the federal government’s actions. If Macy’s or Playboy or Buy.com wants to collect information
about your surfing habits and sell it to other companies,there is nothing to stop them. Absolutely nothing!

This whole issue doesn’t bother some people at all. In fact, they don’t even think about it. The issue doesn’t
bother others until the intrusions are used against them. Think about this: If information is supposedly collected
for one purpose, is it ethical for that information to be used for a totally different purpose without you knowing
it? Is it fair to require you to provide medical information that is primarily intended to be used to pay your
insurance bills and then have that same information used against you when the insurance company deems you
too expensive and cancels your policy? Is it fair to have that same information used against you in denying you
employment because you’re too expensive to hire?

Information about people’s moment-to-moment thoughts and actions, as revealed by their online
activity, can change hands quickly. Within seconds of visiting eBay.com or Expedia.com,
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information detailing a Web surfer’s activity there is likely to be auctioned on the data exchange
run by BlueKai, the Seattle startup.

Each day, BlueKai sells 50 million pieces of information like this about specific individuals’
browsing habits, for as little as a tenth of a cent apiece. The auctions can happen instantly, as a
website is visited.

Targeted ads can get personal. Last year, Julia Preston, a 32-year-old education-software
designer in Austin, Texas, researched uterine disorders online. Soon after, she started noticing
fertility ads on sites she visited. She now knows she doesn’t have a disorder, but still gets the
ads. It’s “unnerving,” she says.

The Journal found tracking files that collect sensitive health and financial data. On
Encyclopaedia Britannica Inc.’s dictionary website Merriam-Webster.com, one tracking file
from Healthline Networks Inc., an ad network, scans the page a user is viewing and targets ads
related to what it sees there. So, for example, a person looking up depression-related words
could see Healthline ads for depression treatments on that page—and on subsequent pages
viewed on other sites. (“The Web’s New Gold Mine: Your Secrets,” The Wall Street Journal,
Angwin, Julia, July 30, 2010)

The federal government is taking steps to help protect individual privacy in the United States by passing laws
based on Fair Information Practices (FIP) as you can see in Table 4.3. However, the wheels of government
turn slowly and the first line of defense should be yours.

Table 4.3: Federal Privacy Laws in the United States

The Federal Trade Commission (FTC) has stepped up their efforts to protect consumers’ personal information
on the Internet. An excerpt explains their mission:

Privacy is a central element of the FTC’s consumer protection mission. In recent years, advances
in computer technology have made it possible for detailed information about people to be
compiled and shared more easily and cheaply than ever. That has produced many benefits for

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society as a whole and individual consumers. For example, it is easier for law enforcement to
track down criminals, for banks to prevent fraud, and for consumers to learn about new products
and services, allowing them to make better-informed purchasing decisions. At the same time, as
personal information becomes more accessible, each of us—companies, associations,
government agencies, and consumers—must take precautions to protect against the misuse of
our information. (Copied from www.ftc.gov/privacy)

The FTC added three practices to its framework for privacy that firms should follow:

 Adopt “privacy by design”

 Increase transparency of their data practices
 Require consumer consent and provide opt-out options from data collection schemes

The FTC also extended its FIP doctrine to behavioral targeting practices used by advertisers and
marketers. Privacy advocates want all data gathering to be at the discretion of users with opt-in policies.
Not surprisingly, advertisers oppose that idea and only want opt-out requirements set.

Internet Challenges to Privacy

Under pressure from privacy advocates, government agencies, and the general public, many Web sites now post
privacy policies. Some sites make their policies obvious and others don’t. Some sites actually abide by their
policies and others don’t.

The Wall Street Journal reported in 2010 and 2011 that 75 percent of the top 1,000 Web sites include code
from social networks such as Facebook and Twitter that match people’s identities with their Web browsing
activities even if the person is not actively using the site buttons “Like” and “Tweet.”

Interactive Session: Technology: Big Data Gets Personal: Behavioral Targeting (see p. 124 of the
text) discusses how everything a person does on the Internet is tracked and data stored about the
activity. A person’s whereabouts, locations, habits, and friends are tracked and profiles are
created about the person ostensibly to better target advertising.

How do these organizations gather the information? By using cookies, a part of every browser program. If you
have Internet access and have ever visited a Web site, you can bet you have a cookie file on your computer.

Here’s what a typical cookie file will look like:

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A glimpse of a typical cookie file

Most of the data in the file are unintelligible to you. However, they give information to Web sites about how
you prefer the Web site to be configured, who you are, which Web site you came from, what you do while on a
site, and other information pertinent to the Web site. You can turn off the cookie option in your browser, but
many sites won’t let you access their features if you do.

Because the corporate world is demanding better results for the dollars spent on Internet advertising, some Web
sites have developed Web beacons to help track users and determine what they do and don’t do on the Internet.
Web beacons are tiny, indistinguishable files embedded within a Web page or within an email message. The
beacon monitors behavior of those using the page and combines the information with other data collected to get
a more robust picture of how people are using the Web site and how effective the advertising is.

Cookies are typically used by tracking companies to build lists of pages visited from a specific
computer. A newer type of technology, beacons, can watch even more activity. Beacons, also
known as “Web bugs” and “pixels,” are small pieces of software that run on a Web page. They
can track what a user is doing on the page, including what is being typed or where the mouse is
moving.

The majority of sites examined by the Journal placed at least seven beacons from outside
companies. Dictionary.com had the most, 41, including several from companies that track health
conditions and one that says it can target consumers by dozens of factors, including zip code and
race. Dictionary.com President Shravan Goli attributed the presence of so many tracking tools to
the fact that the site was working with a large number of ad networks, each of which places its
own cookies and beacons. After the Journal contacted the company, it cut the number of
networks it uses and beefed up its privacy policy to more fully disclose its practices.

The widespread use of Adobe Systems Inc.’s Flash software to play videos online offers another
opportunity to track people. Flash cookies originally were meant to remember users’
preferences, such as volume settings for online videos. But Flash cookies can also be used by
data collectors to re-install regular cookies that a user has deleted. This can circumvent a user’s
attempt to avoid being tracked online. Adobe condemns the practice. (“The Web’s New Gold
Mine: Your Secrets,” The Wall Street Journal, Angwin, Julia, July 30, 2010)

Increasingly, Web sites are using spyware in an attempt to gather marketing information about visitors and
customers. This type of software is installed directly onto your computer and sends data to the company about
your surfing habits. Unfortunately, this software can also cause problems with your computer and send

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information that can be used in identity theft. If you haven’t yet installed spyware detection software on your
computer you should consider doing so.

Most e-commerce merchants are pushing for self-regulation and the practice of requiring individuals to “opt-
out” of data gathering. Opting out allows individuals to tell an organization not to share personal information
with any third party. The government initially agreed with that position, but has since realized it isn’t working
very well for individuals. In mid-2000, the Federal Trade Commission started seeking government regulation of
information gathering and advocates the right of individuals to “opt-in.” Opting in requires individuals to
expressly give an organization the right to gather information before any information can be collected. Visit the
FTC Web site (www.ftc.gov/privacy/index.html) for the latest information on this subject.

As the textbook points out, very few companies actively protect their users’ privacy. It’s usually not in the
company’s best interest to do so. And very few users seem to care. Although most users express a desire to
have their privacy protected, they do not actively ensure that it is. Less than half of Web site users polled had
read the privacy policies posted on most Web sites. To which group do you belong?

Technical Solutions

According to the law you must inform someone if you are taping a telephone conversation with them. On the
other hand, you can legally record that person’s Internet transmissions without any need to inform them you are
doing so. This type of disparity exists because our laws have not kept up with emerging technologies. There are
some tools that can help you block someone from tracing your Internet activities as the text discusses.
However, if you use your company’s computers for most of your Web-browsing or email activities, you may
want to check with your Information Technology department before you install the tools.

Property Rights: Intellectual Property

Intellectual property issues have been around for hundreds of years. Some of the laws and policies in place to
settle disputes about copyrights, patents, and trade secrets, have to be rewritten to apply to the Internet.
Intellectual property is a result of someone’s effort at creating a product of value based on their experiences,
knowledge, and education. In short, intellectual property is brain power.

What if you wrote the next great American novel hoping to cash in big time? Maybe you could retire to the
Bahamas and drink lemonade on the beach all day. But then you find out that someone posted your next great
American novel to the Internet and everyone is reading it free of charge. Now you’re back in your hometown
drinking lemonade at the local mall while you decide whether to look for a job at McDonald’s or Burger King.
The good news is everyone loves your book!

Unfortunately, that sort of thing happens too often in the cyberworld. You’re pretty excited to get that free copy
of the newest game software, while the poor guy who spent hours of his time and effort writing it is not so
excited to realize he’s not getting any compensation.

Everything on the Web is considered to be protected under copyright and intellectual property laws unless
the Web site specifically states that the content is public domain. The Web site doesn’t need to carry the
copyright symbol © in order for it to be protected. President Clinton signed the Digital Millennium Copyright
Act (DMCA) in January 1998 making it a federal offense to violate copyright laws on the Internet, punishable
with a fine up to $250,000.

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Copyright laws and intellectual property rights cannot be violated on the Internet any more than they can in
other mediums. Although this isn’t a law class, you should be aware of the fine line between acceptable and
legal usage of materials and the illegal theft of materials. When it comes to copyright material, the underlying
ideas are not protected, just the publication of the material. On the other hand, a patent grants a monopoly on
the underlying concepts and ideas. Before you use anything, especially any material on the World Wide Web,
make sure you are using it legally and ethically.

Get past the idea that because everything on the Web is free, easy to access, and available 24-hours a day, it
must therefore be okay to use it however you want. The question you should be asking yourself is, “Is it
ethically right and legal?”

The Business Software Alliance (www.bsa.org) is an organization working to prevent software piracy and the
illegal use of copyrighted material around the world. And don’t think the problem is limited to the 17-year-old
computer geek locked in his bedroom. This crime can be committed by anyone, as this newsclip shows:

Seventeen high-tech professionals were indicted on federal charges for participating in an

Internet piracy ring that hijacked software worth more than $1 million. The government said 12
of those indicted are members of an underground organization while the five others are
employees of Intel Corp. The individuals indicted were charged with conspiracy to infringe on
copyrights, which carries a maximum sentence of five years in prison, a $250,000 fine, and
restitution. (AP Newswire, May 5, 2000)

Perhaps the most notorious copyright infringement and intellectual property case in 2000 and 2001
involved the music industry. MP3, one of the most popular methods of illegally downloading music
from Web sites, lost a court battle waged by the music industry. MP3 was forced to pay millions of
dollars to the industry for lost revenues. The rock group Metallic sued Napster.com because it allowed
people to trade copyrighted material illegally. Napster.com lost the battle and went on to devise methods
for legally downloading music. So before you copy your favorite sound clip, remember you’re actually
stealing someone else’s property as surely as if you walked into a retail store and took the CD without
paying for it. The music industry and the film industry are now suing individuals who continually
download copies of songs and movies from free Web sites.

Accountability, Liability, and Control

Many of our laws and court decisions establishing precedents in the area of accountability, liability, and
control, were firmly in place long before computers were invented. Many of them date back to the early 1900s,
and some simply don’t make sense in this day and age. That’s what we were referring to in the opening
paragraphs of this lecture when we talked about new questions for organizations, companies, and the workplace
in general. No issue makes this subject more important than the Internet laws our government has tried, and still
tries, to pass.

One tenet of the Communications Decency Act (struck down by the courts) and the Child Online Protection Act
is that the Internet Service Providers should somehow be liable for content placed on the Internet through their
users. Ask yourself these questions: “If you receive an obscene phone call, is the telephone company
responsible and liable for the problem? If you receive a threatening letter in the mail, is the U.S. Post Office
responsible for reading every piece of mail on the chance that there might be a problem in one of the letters?”

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The text gives several examples of recent liability problems and the difficulties companies face as networks,
computers, and data increasingly become common strategic tools.

Computer-Related Liability Problems

Laudon and Laudon discuss the difficulties the Blackberry smartphone maker Research in Motion (RIM) has
had with service outages over the last year. Most users were without access to email and other applications they
relied upon. The important question that’s beginning to plague more and more companies is this: who is liable
for any economic harm caused to individuals or businesses that cannot access their email or other applications
during service outages?

System Quality: Data Quality and System Errors

As we rely on information systems more, data quality issues are gaining importance. These issues affect you as
a consumer and as a business user.

As our reliance on technology continues to grow, we’re bound to run into problems caused by poor system
quality more often and in unexpected ways.

Facebook’s Sept. 23 outage was caused by a software flaw that crippled its database
clusters, the company confirmed. The downtime was the worst at the social network in
four years. The outage that darkened Facebook for two and a half hours Sept. 23 was
caused by a software flaw in its database clusters, the company confirmed. Some of the 500
million-plus Facebook users tweeted about the event on Twitter, wondering what they
would do without access to their photos, links, videos and other content they shared on the
massive social network. “The key flaw that caused this outage to be so severe was an
unfortunate handling of an error condition,” said Robert Johnson, director of software
engineering at Facebook in a blog post. “An automated system for verifying configuration
values ended up causing much more damage than it fixed.” (“Facebook Outage Triggered
by Database Software Error,” eWeek.com, Boulton, Clint, Sep 24, 2010)

It was likely another eventful weekend for the engineers in Amazon’s Web services division. On
Sunday afternoon, a hardware failure at Amazon’s U.S.-East data center in North Virginia led to
spiraling problems at a host of well-trafficked online services, including Instagram, Vine, AirBnB, and
the popular mobile magazine app Flipboard.

Amazon (AMZN) blamed the outage on glitches with a single networking device—what it called a
“‘grey’ partial failure” that resulted in data loss—and said it was conducting a forensic analysis. The
entire incident lasted all of 49 minutes, but like many recent cloud service outages, the resulting
questions are likely to last considerably longer. Why are so many prominent Web companies overly
dependent on a single cloud provider—and a single data center? (“Another Amazon Outage Exposes the
Cloud’s Dark Lining,” Bloomberg BusinessWeek, Stone, Brad, Aug. 26. 2013)

When the credit reporting agencies screw up your credit record and you can’t get a car loan, whose fault is it?
What if you’re driving down the road, the computer chip controlling your brake system fails, and you have a
rather nasty crash. Who's at fault? You, the car company, or the company that made the computer chip? Who is

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responsible for system downtime when a popular email program has holes allowing viruses to spread and
multiply; the software manufacturer or the company that licenses the software?

Most of us use software that a manufacturer knows contains bugs. They usually are nothing more than an
aggravation and a frustration. But once in a while, they will affect our use of the computer. Our natural
tendency is to let the marketplace control the balance by letting the customer punish or reward the producer.
But will that be enough, or will the issue end up in the courts?

When a network server crashes and day-traders miss an important trade, like those that happened several times
in August 2013 on Wall Street, who is responsible for the lost income? The ISP? The financial service
company? No one? As more and more companies do business on the Internet, will Internet Service Providers or
the companies doing business on the Internet be held accountable for equipment outages that render those
businesses unable to process transactions?

Quality of Life: Equity, Access, and Boundaries

Invariably, when discussing online technology, some students mention their concern about losing the face-to-
face contact with other human beings. We hear stories about children who haven’t developed normal social
skills because they spend all their time in front of a computer. No discussion about the quality of life issues
would be complete without mentioning the tales of “online love affairs.” Of course, many people lose their jobs
and their way of life because of technology. These are all very valid concerns.

What, in your opinion, is the impact of all this wired stuff on children? How should we protect them against the
threats, real or perceived? The Child Online Privacy Protection Act (COPPA) that went into effect in April
2000 has helped prosecute online predators and others using networks to commit crimes against children.
However, it seems the more we try to protect childrens’ use of the Internet, the more ways people find to harm
them.

The Electronic Frontier Foundation (www.eff.org), an organization dedicated to “protecting rights and
preserving freedom in the electronic frontier,” has lots of information about protecting free speech on the
Internet.

One quality of life issue that affects more and more people personally is the ability to work from home. Most
telecommuters had a “regular day job”, 9–5, five days a week, in a typical office setting. If they didn’t get their
work done today, they would usually wait until they were back in the office tomorrow or Monday. Now
because of technology they can work seven days a week, all hours of the day, at home. And sometimes they do.
The impact on personal and family life can be considerable. In many regards, this problem extends not just to
telecommuters but to many employees who spend their normal 40–50 hours a week in the office and then stay
“wired” in the evenings, on weekends, and even during vacations.

There is an upside to the jobs issue, though. Many parents like telecommuting because they can stay home with,
or at least be nearer, their children. More and more people are leaving the big cities and moving to small towns
for the quality of life, yet they can still keep their well-paying jobs. Many small companies are able to expand
their customer base because of technology, which in turn helps the employees immensely. Completely new
businesses are born because of technology.

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Computer crime is one area that has been extremely hard for our society and our governments to keep up with
the rapid change. Many laws have to be rewritten and many new laws must be implemented to accommodate
the changes. Computer abuse extends to any wrongdoing involving equipment and Internet usage. We spoke
earlier about anonymity not being a license for socially unacceptable behavior. You should remember that
everything you do on a network or the Internet is recorded and can be tracked. Many people committing
computer crimes and abuse have been caught and prosecuted.

Spamming (unsolicited email) has been challenged in the courts by Internet Service Providers (ISP) as an
unfair practice. The ISPs say thousands of these emails clog their systems, and no one wants them anyway. The
spammers argue their right to freedom of speech is violated if they can’t send emails to anyone they want.
Congress passed a new law in late 2003 to clamp down on spamming. Unfortunately, the law doesn’t seem to
be producing very many positive results.

Other issues affecting our society include job losses and career changes caused by technology. You can argue
the positive or negative effects, but one thing is clear: you’ll be a part of the evolution of technology for the rest
of your life. You will have to continually update your skills and knowledge in order to remain competitive in
the job market. As companies continue to embrace new technology and new methods of using it, you’ll be
responsible for ensuring your skills and education remain current.

Our government recognizes the danger of allowing unequal access to technology to fester. It has enlisted the
help of private individuals and corporations in the effort to install computers and Internet access in public
schools and libraries all across the nation and the world. Most schools are now wired for networks and are
learning to incorporate technology into the curriculum. There’s even a Web site (www.digitaldivide.org)
dedicated to the digital divide situation.

Interactive Session: Organizations: Wasting Time: The New Digital Divide (see p. 136 of the text)
discusses the pros and cons of all the technology we have available all around us. Efforts of
government, private, and non-profit organizations are intended to give parents and students the
skills to use technology responsibly.

As managers, you should be acutely aware of the health issues caused by computer usage, especially repetitive
stress injury (RSI). Why? Because these health issues cost businesses huge amounts of money each year in
medical treatment claims and lost productivity. Carpal tunnel syndrome, a subset of RSI, is the most serious
health issue plaguing businesses. Computer vision syndrome is increasing as people continually use computer
screens and handheld devices that strain eyesight.

It doesn’t take much to avoid the problems associated with computer usage. Ergonomics, the study of the
relationship between humans and machines, has helped determine that it’s cheaper to purchase equipment that
reduces the health risks associated with computers, such as different keyboards, monitors that reduce eye strain,
and desks that allow proper body positions.

Too much of a good thing can be bad. You’ve heard of road rage, the anger people experience when driving.
We are now experiencing road rage on the Information Superhighway, and it’s called technostress. Managers
should encourage their employees to take frequent breaks from their computers and to recognize and
understand the dangers of isolation from humans. We may be a wired nation, but we still need the human touch.

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As the use of laptops continues to grow, you should be cognizant of the difficulties you may encounter by using
one.

The very design of laptop computers encourages bad posture among college students and other
heavy users, which can lead to headaches, muscle strain and debilitating neck, shoulder and hand
injuries, researchers caution.

Such a sacrifice to convenience comes at a price, Carneiro noted. Awkward positioning of the
fingers and body can cause nerve injury to the wrist and prompt the onset of carpal tunnel
syndrome, while poor neck position and shoulder posture can cause muscle strain and soreness
in those areas. (“Students warned to beware of ‘laptop-itis’,” USAToday Online, Mozes, Alan,
Aug 22, 2010)

For the most part, the same precautions you take with regular computers will help you combat difficulties
arising from too much laptop use.

How has all this technology affected you? Think about it. Ultimately, there is a positive and a negative side to
everything. How you handle it determines how it affects you.

Bottom Line: If it sounds too good to be true, it is. If it’s illegal or immoral or unethical outside the
computing arena, it’s probably illegal, immoral, and unethical in the computing arena. If you are aware
of a problem or are a victim of unethical, illegal actions, and you don’t do something about it, you’re
part of the problem. It’s your new world—use it wisely.

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Discussion Questions

1. Discuss the personal and professional implications of so much individual data being gathered, stored, and
sold. Should businesses be allowed to gather as much as they want? Should individuals have more control
over their data that are gathered?

2. Briefly describe your Internet Service Provider’s email usage policy. If you are on campus, your school
should have a usage policy.

3. Describe how your quality of life has improved or declined with the technological advances in the last five
years.

4. How do you think our government should handle the political issue of Internet decency and access
limitations?

5. To what extent should Internet Service Providers be held liable and accountable for the use of their
equipment?

Answers to Discussion Questions

1. Answers will vary but should include references to the ethical uses and responsibilities that businesses have
in regard to individual privacy. Some students will argue that it doesn’t matter—there is no privacy
anymore. Other students may favor stricter rules in favor of individual control over the data.

2. Answers will vary according to the ISP and the educational institution.

3. Answers will vary, but improvements should include ease of communication (email, cell phones); ease of
access to information (Internet search); making daily tasks easier (banking online, shopping online).
Declines in quality of life: ability to work anytime, anywhere blurs the boundary between work and family
life; cell phones everywhere can be intrusive and annoying; email can mean too much time spent combing
through messages to determine what is important and requires answering.

4. Answers will vary, but might include: the federal government should be involved in monitoring the
Internet, should pass federal laws to regulate access, but stay out of decency issues because of the First
Amendment; or government should stay away and let the Internet monitor itself.

5. Answers will vary, but might include holding those who choose to use a technology responsible for the
consequences of that technology, not the providers of the technology; or holding ISPs responsible for the
harm that follows because of a breakdown of their equipment, on which businesses and individuals depend;
that ISPs should monitor the email sent over their equipment. This is a hard one, because an ISP provides a
service, like the phone company, and the phone company is not responsible for the phone calls people make
unless people use the phone to engage in criminal activities such as harassment.

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