1. Why E-Commerce is Like a Bottle of Tylenol Professor Peter P. Swire Ohio State Law School Conference on New Technologies and International Governance February 11, 2002

2. Overview n Bottle of Tylenol n What we used to think about E-commerce n What we should think now about E- commerce n Conclusion

3. I. Bottle of Tylenol n The 1980s and poison episode n Johnson & Johnson response – Remove from shelves – Build trust into every transaction

4. Tylenol and E-Commerce n Youve heard of shrinkwrap and clickwrap n Meet trustwrap n What sorts of trustwrap will work for E-commerce

5. II. What we used to know about. E-Commerce n Online e-cash n Pure Internet plays n Unmediated matching of buyers and sellers – This worked! – Left handed corkscrews

6. III. What we should know now. about E-commerce n Credit cards beat e-cash – $50 rule – Dispute resolution built in n Our first example of trustwrap

7. Pure Internet plays? n Rise of the clicks and bricks n Brands, solidity, and trust n Trade-ins, complaints, customer service – All the same day – Or, can use the Net as with a pure play n Jurisdiction and choice of law favor consumers – Hard to deny local consumer protection laws if have a large store there

8. The end of intermediaries? n eBay n The initial dream of community and feedback as sufficient

9. eBay as Shadow Legal System n Buyer protection against non-delivery n Seller protection against non-payment n Seller protection against outages n Rules for limiting free speech (feedback) n Anti-shill rules n Dispute resolution n Criminal enforcement against fraud n Lots more

10. IV. Conclusion n Johnson & Johnson created trustwrap – Tylenol priced much higher than generic n Trustwrap has helped online survival amidst the dot-bombs – Credit cards – Clicks and bricks – eBay

11. Conclusion (cont.) n Competition in trustwrap – Infomediaries havent succeeded n The trustwrap that is winning in the marketplace has important legal guarantees to consumer – Credit card rules – Jurisdiction and consumer protection rules – All the eBay rules

12. Conclusion n What we used to know about E-commerce n What we should know now about E- commerce n Bigger role for legal guarantees than many once thought

13. Contact Information n Professor Peter Swire n Phone: (301) 213-9587 n Email: pswire@law.gwu.edu n Web: www.osu.edu/units/law/swire.htm n Presidential Privacy Archives: www.privacy2000.org