1. Ethical and Social Issues in the Digital Firm

2. Chapter Four Outline A. Nature of the issues B. Liability for software
I. Introduction
A. Relate to questions
B. Meaning of ethics
C. Technological trends/ethical issues
D. L&L’s framework
II. Information rights/Privacy
A. Privacy and its origins
B. Fair information practices
C. Europe’s approach
D. Privacy and the Internet
E. Technical solutions
F. Other privacy issues
G. Levels of privacy issues
III. Intellectual property
A. Concept examples
B. Old protectors
C. Protection for software
D. Other intellectual property
E. Levels of intellectual prop issues
IV. Accountability, liability, Control
A. Nature of the issues
B. Liability for software
C. Liability for information services
D. Levels of the issue
V. Quality
A. Software and data
B. Levels of the issue
VI. Quality of Life Issues
A. Empowerment
B. Rapidity of change
C. Boundaries
D. Dependence/vulnerability
E. Computer crime and abuse
F. Negative consequences
1. Reengineering
2. Health issues
3. Equity and access

3. What Are Ethics?
Ethics are principles of right and wrong that can be used by individuals acting as free moral agents to make choices to guide their behavior
Information technology is moving so fast that situations arise in which it is not clear what is ethical behavior
Technology introduces capabilities that were impossible several years ago. This is particularly true with respect to information technologies and biotechnologies

4. What are the Main Features of Ethical Choice?
Responsibility means that individuals accept the potential costs, duties, and obligations for their decisions
Accountability means that mechanisms are in place to determine who is responsible for an action (social institutions)
Liability concerns laws that permit individuals to recover damages done to them by other individuals or systems (political institution)
Due process implies laws are well known and there is an appeal process to ensure that laws are applied correctly

5. Understanding Ethical And Social Issues Related To Systems (Laudon & Laudon framework)

6. Specific Technology Trends That Raise Ethical Issues
Computing power has been doubling every 18 months since early 80s enabling most firms to utilize computers for their core processes
Rapidly declining storage costs make it possible to collect/store huge amounts of information on people at virtually no cost
Advances in data analysis technology allow firms to develop detailed profiles of individual behavior
Networking advances and the Internet permit remote access and easy copying

7. Nonobvious Relationship Awareness (NORA or data mining)
Figure 5-2

8. Information Rights: Privacy and Freedom in an Information Society
Privacy concept - an individual has the right to be left alone, free from surveillance or interference from other individual, organizations, or the state
Basis of privacy protection in the US
first amendment (free speech and association)
fourth amendment (protection from unreasonable search)
Fair Information Practices (FIP) report from 1973 is the basis for numerous Federal statutes
Legislation has been proposed to protect personal information gathered over the Internet

9. FTC’s Fair Information Practice Principles*
Notice/awareness – disclosure of practices before collecting data
Choice/consent – opt in/opt out for consumers
Access/participation – consumers can review and contest data for accuracy and completeness
Security – data collectors must take steps to secure data for accuracy and unauthorized use
Enforcement – there must be a mechanism in place to enforce FIP principles
*These are guidelines not laws.

10. Europe’s Approach to Privacy Protection
Europe’s notion of informed consent
Safe harbor and its impact on US businesses with European customers
American laws are designed to protect citizens from privacy violations from government agencies, but private business is largely immune.
Europe protects its citizens from abuse both government and private business

11. The Internet and Privacy Issues
Monitoring and tracking is wide spread
Web retailers have created huge demand for consumer personal information/behavior data
Methods of data collection
Customer registration and cookies
Web bugs
Spyware
Opt-out and opt-in models of informed consent
Industry self-regulation
Online Privacy Alliance (Truste)
Network Advertising Initiative

12. Technical Solutions to Protect Privacy
Managing cookies (Internet Explorer)
Blocking pop ads based on user profiles
Encrypting or data (PGP)
Anonymous
Platform for privacy preferences (P3P)
To check for P3P with Internet Explorer, click on View/Privacy report
Try with does use P3P, and do not

13. Other Issues Related to Privacy of Information
Under what conditions should the privacy of others be invaded?
Under what conditions is it legitimate to intrude into others’ lives through unobtrusive surveillance, through market research, or by whatever means?
Do we have to inform people that we are eavesdropping?
Do we have to inform people that we are using credit history information for employment screening purposes?  

14. Levels of the Privacy Issues
Ethical issues (individual)
Under what conditions do you invade the privacy of others? Do you inform them beforehand?
Social issues (society)
Expectations of privacy
Political (legislation)
What laws do we want to govern the relations between record keepers and individuals? What data should the FBI be allowed to collect?

15. Property Rights: Intellectual Property
Intellectual property - intangible property created by individuals or corporations which is subject to protections under trade secret, copyright, or patent
Challenges to intellectual property rights
copying programs (look and feel issues)
digital versions of books, video, and audio make it easy to alter, copy, and transmit
networks make it easy to copy and distribute to millions

16. Protection for Intellectual Property
Protection of intellectual property is protected:
Trade secret: Intellectual work or product belonging to business, not in the public domain
Copyright: Statutory grant protecting intellectual property from being copied for the life of the author, plus 70 years
Patents: A grant to the creator of an invention granting the owner an exclusive monopoly on the ideas behind an invention for 20 years

17. Protection for Software
Source and object code cannot be copied
Purchase of software permits the purchaser to use the software, but creator retains title
Underlying ideas of software are not protected
Look and feel copyright infringement
distinction between an idea and an expression
merger of an idea and an expression

18. Other Intellectual Property Issues
Music
Napster
Other illegal file sharing
Movies
Content on Web pages
Digital Millennium Copyright Act provides some protection because it makes it illegal to make, distribute, or use devices that circumvent technology-based copyright protection
Software Publishers Association and Software Information Industry Association

19. Levels of the Intellectual Property Issues
Ethical issue (individuals)
Should you copy?
Social issue (society)
the ease of copying is making us a society of lawbreakers; people freely admit to copying
Political issues (laws)
Can creators of digital products be protected by law?
Cultural clashes with Western ideas of intellectual property
Software should be free or paid for voluntarily contributions

20. Accountability, Liability, and Control
New technology challenges existing liability law and social practices for holding individuals and orgs accountable for the creation and sale of new IS/IT products and services
Examples
If a person is injured by a machine controlled by software, who is liable?
Should electronic services like America-On-line be held accountable for offensive material on their Web site?
If you outsource your information processing, can you hold your external vendor liable for damages to your customers?

21. Liability and Software
Some software may be part of a machine
Some software acts more like a book storing and displaying information
Software as a service (ATM)
Difficult to hold software producer liable when the product is considered like a book

22. Liability of Electronic Information Services
Are such services liable for the content of their transmissions?
Telephone companies are not liable for their transmissions
Radio and television are liable
What should we do with respect to the Internet, America-On-line ?
What happens when one company provides telephone, cable, and Internet access services over one wire?
Communications Decency Act

23. Levels of the Accountability, Liability, and Control Issues
Ethical issue (individuals)
Are individuals and organizations that create, produce, and sell information systems morally responsible for the consequences of their use?
If so under what conditions?
Social issue (society)
What should our expectations be? Should the developer of the service be responsible for harm or should the organization that purchased the service be held accountable?
Political issues (laws)
Should legislation impose liability or restrict liability on service providers?

24. Systems Quality: Data Quality and System Errors
All software has bugs; not all bugs can be found before releasing software; seriousness of remaining bugs is unknown
No database is without errors. In fact, most consumer and government personal information databases have errors ranging from 10-20% of the data records being either inaccurate, incomplete, or ambiguous. How should decision makers treat this kind of information in order to be fair to data subjects?

25. Levels of the System Quality Issue
Ethical issue is: At what point do you release software or services for consumption by others?
Societal issue: What should society expect about software and systems? Infallibility is unreasonable.
Political issue: Should there be laws holding firms accountable/liable?
Should there be quality standards? Who develops them?

26. Quality of Life: Equity, Access, Boundaries
Negative consequences of IS/IT
Empowerment - much of the decentralization of decision making has been trivial; Is Big Brother really here?
Rapidity of change
Boundaries between family, work, and leisure
Dependence and vulnerability
Computer crime and abuse
Abuse is the commission of acts involving a computer that may not be illegal but are considered unethical (e.g., spam?)
Computer Fraud and Abuse Act of 1986

27. Quality of Life: Equity, Access, Boundaries (continued)
Negative consequences of IS/IT
Technology and re-engineering job loss
Equity and access (do all members of society have equal access to IS/IT)
Health risks
RSI
CVS
Technostress

28. Conducting An Ethical Analysis
Identify and clearly describe the facts
Define the conflict and identify the higher order values involved
Identify the stakeholders
Identify the options that you can reasonably take
Identify the potential consequences of your options

29. Management Actions Regarding IS and Ethics
Most firms do not have an IS-specific code of ethics
Disagreement whether an IS-specific code is needed or a more general code of ethics
L&L recommend an IS-specific code of ethics that addresses each of the five ethical issues

30. Links Related to Privacy and Ethics
The Electronic Privacy Information Center (EPIC)
This site shows how easy it is to get private information about people (stalkers)
This is the home page for Computer Professionals for Social Responsibility (CPSR)