1. Legal and Ethical Issues: Privacy and Security Chapter Five

2. Copyright © Houghton Mifflin Company. All rights reserved.5–25–2 Chapter Five Learning Objectives To understand why Internet laws and jurisdiction are in a state of flux and what remedies are being attempted To learn what important legal issues confront internet marketers To consider whether ethical marketing behaviors can be enforced on the Internet To understand why online security problems concern buyers and sellers

3. Copyright © Houghton Mifflin Company. All rights reserved.5–35–3 Tips for Smart Web Shopping Before purchasing, shoppers should determine Is the business legitimate? Are prices and conditions clearly stated? Is the transaction currency calculated? Is ordering secure? Is privacy respected? Is there recourse? Is the credit card statement correct?

4. Copyright © Houghton Mifflin Company. All rights reserved.5–45–4 Laws and Jurisdiction Lack of uniform Internet law Challenge to maintain order Maintaining order affects business success Different national legal systems often conflict UN, ABA, WTO, OECD and others trying to develop uniform guidelines Should there be a unique law of the Internet?

5. Copyright © Houghton Mifflin Company. All rights reserved.5–55–5 Laws and Jurisdiction (cont’d) Jurisdiction determines –Which courts have the right to exercise authority? –Which courts have the power to do so? –Which courts have control over issues and parties? Interactive/passive relations jurisdiction test Upload/download status jurisdiction test The USA Patriot Act of 2001 –The United States as the Internet’s police?

6. Copyright © Houghton Mifflin Company. All rights reserved.5–65–6 Legal Concerns Fraud is a criminal act –The Internet fraud complaint center –Most frauds at online auctions –EBay and other sites responding to fraud threat On-site self-monitoring Posted warnings Bar offenders from site Diversify to lessen risk from auction fraud

7. Copyright © Houghton Mifflin Company. All rights reserved.5–75–7 Legal Concerns (cont’d) Property protection Copyright Patents Trademarks Domain names Liability and disclaimers Contracts and digital signatures

8. Copyright © Houghton Mifflin Company. All rights reserved.5–85–8 Legal Concerns (cont’d) Speech –Consumer complaints –Corporate bashing –Free speech Taxation Gambling Visual pornography

9. Copyright © Houghton Mifflin Company. All rights reserved.5–95–9 Online Ethics and Privacy Online ethics –Moral principles, rules of conduct –Standards differ between and even within countries Online consumer research –Ethics of information collection –Identification of researchers –Scientific soundness of chat room research –Information use

10. Copyright © Houghton Mifflin Company. All rights reserved.5–10 Online Ethics and Privacy (cont’d) Marketing of professionals Marketing to children and other vulnerable groups –COPPA Marketing restricted products Unsolicited commercial email (spam) Self-regulation Privacy or personalization

11. Copyright © Houghton Mifflin Company. All rights reserved.5–11 Security Issues Hackers Crackers Cyberterrorism Viruses

12. Copyright © Houghton Mifflin Company. All rights reserved.5–12 Security Issues (cont’d) A DOS Attack Access to a Web Site Is Blocked for Legitimate Users When Captured Computers Overwhelm the Site’s Servers Vandals Take Over Innocent Computers Access to the Web Site is Blocked