Consumers in the marketspace – the ethical aspects of electronic commerce

AUTHOR

Janusz Wielki, Ph.D.,
Technical University of Opole,
Faculty of Management and Production Engineering,
Poland

ABSTRACT

Rapid development of information technology, and particularly the emergence the Internet, has caused many significant shifts in the marketplace and has strongly influenced consumers worldwide. As argued by Rayport and Sviokla, traditional marketplace understood as a place where physical interaction between buyer and seller takes place, has been evaluating into the marketspace. It leads to numerous important consequences. Namely transactions, which take place in the marketspace differ from those occurring in the marketplace in all aspects:

  • another is content of transaction (information exchange replaces physical exchange of goods),
  • different is transaction context (physical meeting of buyer and seller has been replaced by action on a computer screen),
  • different is infrastructure, which makes transaction possible (computers and telecommunication lines replace shops or markets)

Additionally, while in the traditional marketplace three above mentioned elements (content, context, infrastructure) are usually aggregated, in the marketspace they can be easily disaggregated and manipulated independently.

Described above new situation influences consumers in two ways. On one hand, the development of the global marketspace gives them a lot of new opportunities and strengthens their position. The most obvious benefits comprise increased convenience of purchasing process, a wider choice of products, more detailed and complete information about them, possibility of buying customized goods and services, opportunity of comparison shopping, possibility of instant receiving on-line intangible goods (music, electronic books, software, stocks, airline tickets etc.), access to offers of merchants regardless their physical location, possibility of easy exchanging information and opinions about products with other consumers worldwide in numerous specialist discussion groups or lists and lower in some cases prices.

But there are other aspects of on-line transactions and generally electronic commerce. Despite the fact that history of the commercial utilization of the Internet is quite short (1) and that retail e-commerce sales are even in the leading countries as the U.S. still very low (2), experience acquired during these past few years leads to the conclusion that the marketspace means not only more convenience and new opportunities. There are also dangers not experienced by consumers before, new challenges as well as ethical dilemmas unknown on traditional marketplaces and all these issues are widely discussed in the paper.

First, attention is focused on dangers connected with on-line transactions. The different context of a transaction in the cyberspace (replacing the physical meeting of buyer and seller by action on a computer screen), fact that they are very often located thousands miles away from each other and situation that in many cases buyers purchase goods from firms existing only on-line (Web-only companies), results in such things as undelivered goods ordered from a Web site or on-line auctions of bogus items. Under circumstances like that trust and credibility become the key elements of on-line transactions. This aspect of e-commerce is in detail analyzed in the first part of the paper.

Next part of this article is focused on privacy issues. Experience of the first few years of electronic commerce development, proofs that this aspect of transactions conducted in the marketspace seems to be extremely important and has already evoked a lot of dilemmas as well as provoked numerous discussions. Since companies operating on-line know much more about their customers, comparing to those ones operating in the real world (name, address, preferences, history of purchased goods, credit card number etc.), such a situation provokes various dangers. It is especially important in case when a company exists only in a virtual reality and has no other assets. In situation when such a firm has financial problems their only capital, which can be sold, is database with mentioned about information. Cases of companies as More.com (3) proofed that with development of electronic commerce this issue can constitute a serious problem and solutions used so far (voluntary created by firms privacy policies) seems to be ineffective.

The following part of the paper concentrates on ethical aspects of electronic marketing. Since new environment requires from marketers revising so far used paradigms and developing new approach to relationship between marketer and consumer, they try to utilize new tools and new methods, but not always in a way which is commonly acceptable. An example can be the problem of cookies or spamming. These aspects are widely discussed in this part of the paper.

Next part of the article concentrates on methods of solving mentioned above issues. It discusses such solutions as electronic signature acts, antispam legislation, privacy policies, establishing netcoalitions in order to protect consumers’ privacy on-line, functioning of institutions as Internet Fraud Complaint Center or possibilities of utilization by consumers discussion groups or lists against dishonest companies. In the final part of the paper, conclusions and suggestions are provided.

  1. For example, the most famous Internet company, Amazon.com, was established in July 1995, ITN which was the first company offering travel services over the Internet, has been functioning since May 1995, while Auto-by-Tel , the network of accredited dealers from U.S., started its business activity in March 1995.
  2. According to U.S. Census Bureau, in the second quarter of 2000 it accounted for only 0.68 percent of total retail sales.
  3. Company decided to sell its customer data, including information about products and prescriptions customers purchased, although it promised never to do it.

Lilliputian Computer Ethics

AUTHOR

Associate Professor John Weckert
Centre for Applied Philosophy and Public Ethics,
Charles Sturt University

ABSTRACT

Nanotechnology and quantum computing have the potential to radically change information technology. If these technologies are successful, and there are signs that they will be, computers will become very, very small, very, very fast, and have an enormous amount of memory relative to computers of today. This is creating excitement in some quarters, but anxiety in others. Speaking of nanotechnology, in a recent and much publicised article, Bill Joy wrote that “It is most of all the power of destructive self-replication in genetics, nanotechnology, and robotics (GNR) that should give us pause. In truth we have had in hand for years clear warnings of the dangers inherent in widespread knowledge of GNR technologies – of the possibility of knowledge alone enabling mass destruction. The only realistic alternative I see is relinquishment: to limit development of the technologies that are too dangerous, by limiting our pursuit of certain kinds of knowledge.” (Bill Joy, Wired, 8.04, 2000)

Given the variety of benefits promised by nanotechnology in medicine, the environment, and information technology, to pick out just a few, Joy’s claim seems a little strong. This paper will discuss a few worries, some raised by Joy, to see what the appropriate reaction to this technology is. Are the worries enough to give his call for a halt to research any plausibility?

While nanotechnology has potential benefits and dangers in a wide variety of areas, for example in health and in the environment as previously mentioned, we will consider here just some potential dangers in the computing area.

There are at least two sets of issues. One set concerns existing problems which will be exacerbated by the miniaturisation of computers. This miniaturisation will involve the development of smaller, much more powerful machines (much faster and with much more memory), and with much more sensitive input devices. The second set concerns potentially new problems.

Important in the first set of problems will be privacy. Vast databases that can be accessed at very high speeds will enable governments, businesses and so on to collect, store and access much more information about individuals than is possible today. In addition, the capacity for data mining, the exploration and analysis of very large amounts of data for the purpose of discovering meaningful and useful rules and patterns, will increase dramatically. And the monitoring and surveillance of workers, prisoners, and others will be greatly enhanced with the use of small, powerful computers and new sensoring devices for input.

The second set comprises problems which as yet have not arisen, at least not in any significant way. Three will be considered. First, artificial intelligences. If machines are developed that behave in much the same way as humans do, in a wide variety of contexts, the issue will arise of whether or not they are things with moral rights and responsibilities. Second, prosthetic devices. Chip implants in humans that enhance various of the senses, memory and perhaps even other capacities such a reasoning ability and creativity, may blur the distinction between human and machine. Third, virtual reality. It may become difficult to tell the difference between “real” and “virtual” reality.

After the examination of the problems, various responses will be proposed and assessed. The first set of problems should lead at least to the reassessment of privacy legislation, the use of personal information by governments and corporations, and guidelines and legislation for the use of monitoring devices. The potential new developments in the second set could force us to rethink the nature of humanity, the nature of reality, and what constitutes a meaningful and satisfying life. Finally, there should be renewed emphasis placed on examinations of the accountability and responsibilities of researchers and developers. While Joy’s claim for a halt to the research may be extravagant, there are enough worrying aspects of nanotechnology and quantum computing which should make us examine what controls may be justified and what structures put in place to maximise the chances of these technologies being beneficial rather than harmful.

The rise of peer-to-peer communication in the U.S

AUTHOR

Tomoaki Watanabe
Graduate Student and Associate Instructor
Department of Telecommunications
Indiana University at
Bloomington, USA

ABSTRACT

It is often argued that cyberspace heralds an advent of new society and it cannot be governed by an existing norms or styles of governance. The development of technologies, cultures, and social behaviors are reported heavily in the media, and are sometimes consciously staged. This is a case study of one such development, occurred in the U.S., and reported as somewhat revolutionary by some. Aim of this paper is to report a growth of the so-called peer-to-peer (p-to-p, hereafter) communication in the U.S., and related social troubles. The paper provides an interpretive framework for the discussion of online ethics and governance. The inventiveness of p-to-p communication is best characterized by the absence of hierarchy and central point of control. As suggested by the term, it occurs among agents of equal positions. Unlike mass media, where producer and audience is rather sharply divided, p-to-p communication is seemingly highly interactive and there is no divide between producers and audience. The question is, therefore, whether this marks the end of hierarchical mass society and the advent of network society.

First, a number of key applications and services are reviewed as the instances of p-to-p communication. They include online auction (eBay), instant messenger (ICQ, AOL, Yahoo), chat rooms, and file-exchange software/ systems (Napster, Gnutella, Scource). After a brief introduction of their histories, an analysis of their features is provided. Some defining characteristics, such as conversational structure of information flow and flexible connections are abstracted.

Second, the characteristics of p-to-p communication are compared with broad conceptual models of social organization: network, community, association, and hierarchy. It is suggested that the inventiveness of the p-to-p communication can be well-captured by the concept of network. It is especially distinctive when compared to services of video streaming, e-commerce by large corporations, and online news media. Some postmodern normative propositions (such as ‘death of author’ and the end of meta-narrative) that often accompany the discourse of networks society are confirmed to be suitable to capture this situation to a certain degree. At the same time, however, it is pointed out that the existing cases does not present an independent, serious realization of the network society. Instead, a number of critical aspects are dependent on resources of mass society, and thereby subject to their influence. These aspects include centralized points of control, such as proprietary standard and server, and centralized production, such as commercial music pieces. It is suggested that while network society can be well-understood by conversational form of communication, the existing structure of p-to-p communication is close to the dependency of network society on mass society. The structure of dependency is characterized as that of networked information recipients and hierarchical producers.

Third, crimes and other troubles related to the p-to-p communication are reviewed and shown that many are characteristic to the network social organization that do not have centralized structure but complex connections. The reviewed troubles include problematic entries for auctioning, false stork-market information distributed in chat rooms, file exchanges of pirated music and movies, and open-access issues associated with auction service and instant messenger services. A number of suggested/ implemented solutions are reviewed. They include a control at the bottleneck, content surveillance, moral-based self-policing/ protection, and damage-based penalties. It is pointed out that because of decentralized power structure, source of troubles are not the flaws of a large system, but local or individual actions. Victims could be either large corporations or individuals. While large organizations may have resource to identify the source of large scale trouble and thereby protect themselves and recover the damage, small groups and individuals would not. When damages are small, particularly, there may be no incentive to recover the damage.

As a conclusion, it is argued that while the rise of p-to-p communication suggests that cyberspace is becoming less hierarchical, there are still elements of hierarchy in the cases reviewed. Adaptation of new norm (that of network society or postmodernism) and abandonment of traditional norm suggested by some are too radical to be feasible and moral. The key to the less problematic transition to the network society, if desirable, is in the area of information production. Future areas of research is suggested.

Teaching information ethics at the business faculty and the open source software.

AUTHOR

Grzegorz Wapinski
Assistant Professor
Department of Information Systems
Faculty of Business Administration
University of Gdansk
Poland

ABSTRACT

This paper will the current practice of teaching information ethics at the Faculty of Business Administration of University of Gdansk. The reference to the open source software is not accidental, as it solves, at least partially, the problem of software piracy.

As information technologies gain on importance, shifting from the support tools to the basic engine of economy, rising awareness to basic ethical issues of this field becomes more and more important. This seems to be especially important in places where future managers are being taught – all sorts of business schools, faculties of management etc. These new technologies are also creating problems which were either unknown or regarded as having minor importance in traditional ethical systems and everyday ethics.

In the particular case of the Faculty of Business Administration, University of Gdansk, attempts to find the viable solution to this problem are being made. At the level of the common curriculum for all the courses, the ethical issues are raised within the lecture on “Introduction to Information Systems”, either as elements of some topics (for example: databases, software development and acquisition), or as independent topics, such as legal issues and position of information systems in the society.

Within the curriculum of the “Information Systems” the issues of ethical importance are also raised during the courses on “Software Engineering”, “Usability Engineering”, and seminars. There is also the lecture on “Information Ethics”, devoted to discussion of some particular issues, such as privacy, intellectual property, influence of IT on workplace etc..

Because of the growing importance of open source software, and it must be admitted that it gains on popularity among students, it is strongly promoted during the lectures and seminars. For example the course on electronic publishing is based on open source solutions.

Open source software serves as a growing set of high quality and cost effective tools solving some real life IT problems. On the other hand it gives some perfect examples of, for example, real standards (contrary to so called “industry standards”). It also gives students a great chance to participate in project of different complexity, therefore training them in all the skills needed in a successful teamwork.

It must be admitted that including open source solutions within the curriculum does not come easy. One of the most common obstacles is a perception of open source as of something developed after hours and in garages. It comes as the shock when people promoting this software start to enumerate those alleged garages: IBM, Hewlett-Packard, Sun Microsystems. There is also quite a popular argument that if it costs nothing, it can not be good. Some also argue about the quality, and the lack of successful business applications.

Despite doubts mentioned above, open source software enhances teaching of information ethics both on theoretical and practical levels.

Playing God: Technological Hubris in Literature and Philosophy

AUTHOR

Richard Volkman
Southern Connecticut State University
Dept. of Philosophy
Research Center on Computing and Society
New Haven, CT USA

ABSTRACT

Humans are limited creatures. We are limited in our knowledge, we are limited in our power, and, perhaps most distressingly, we are limited in our goodness. This is surely beyond doubt. But it is equally certain that we must not resign ourselves to our own failings. To the contrary, it is a mark of human excellence to never regard one’s own shortcomings with indifference or resignation. Unfortunately, there is a deep tension between these two undeniable truths. On the one hand, we must pursue our own ideal of perfection and strive to become godlike in wisdom, power, and goodness. On the other hand, we must recognize the dangers of overreaching, of playing God. Even as we have rightly cast aside the theological assumptions that once grounded this humility, there is still widespread recognition of the dangers of overreaching.

The Computer Revolution has brought with it a further urgency that we must once and for all learn to live within our limits. Through robotics, advanced artificial intelligence, nanotechnology, and genetic engineering, we are perhaps reaching a point where playing God has become more than a literary device. This has led even some leading architects of the Computer Revolution, including Bill Joy, to call for a moratorium on the further development of such technology. These critics maintain that it is hubris to believe we know enough or are responsible enough to pursue such technologies; we can and must stop the tide of technological change before it is too late.

I argue that this is wrong. “Technological determinism”-the view that what can be done will be done-follows ineluctably from our own “technological hubris.” Technological hubris, in turn, is not an accidental feature of the human condition. Rather, it is an expression of an ethical need to transcend limits, to improve ourselves, to correct our own failings. If we choose to embrace our ability to know and understand, then it is ethically inevitable that we shall act on the knowledge that results. That is, it would be unethical to recognize a means of improvement, but not to pursue it. Consequently, we cannot ethically deny ourselves technology without denying ourselves knowledge and understanding. Since it is precisely this ability to know and understand that locates us in the natural order of things-that fixes our place in the Great Chain of Being, so to speak-we cannot deny ourselves knowledge and understanding without behaving contrary to our own excellence. At the same time, however, we recognize that we are not atop the Great Chain of Being. We are not perfect, even while our peculiar nature gives us the means to achieving greater perfection. Herein lies the paradox. Beings that know their place in the universe cannot consistently will to respect and keep their place in the universe.

This paradox speaks through a long literary tradition that warns against succumbing to the temptations of technology and our own cleverness. In a sense, concern about the ethics of technology has been with us since ancient times; the history of Computer Ethics begins with Aeschylus, not Weiner. In the stories of Prometheus, Faust, Icarus, Frankenstein, and Genesis, we are at once informed of the powerful temptation to embrace knowledge and technology, and warned against the tragic consequences of such overreaching. These lessons are echoed in more recent works such as Blade Runner and The Matrix. We find ourselves both admiring and disparaging the Promethean figure, whose only crime is to aspire to a greatness beyond that permitted him.

We admire the virtues of creativity and inquisitiveness, while deploring the vicious hubris that presumes we have the wisdom to play God. There is no doubt that we do not have such wisdom. After all, there is no way to appreciate the full consequences of our actions when, as Bill Joy points out, “The systems involved are complex, involving interaction among and feedback between many parts. Any changes to such a system will cascade in ways that are difficult to predict; this is especially true when human actions are involved.” We are not that smart. No one is that smart. Certain contemporary works, such as Blade Runner, suggest that even God himself is not smart enough to play God.

As the literary evidence suggests, the tension between recognizing our own limits and attempting to transcend them is a permanent part of the human condition. While it is not logically impossible to turn our backs on this part of our nature-indeed, it is certain that some individuals and perhaps some whole cultures have accomplished just that-it is nonetheless ethically impossible to recognize a means to improvement and not pursue it. Death and ignorance and illness and poverty are evils that it is hoped we can alleviate through technological means. Are these benefits worth the risks?

It is hubris again to suppose we know the answer to this question, and this is why it is ultimately wrong to pursue the moratorium on technology advocated by Bill Joy, Kirkpatrick Sale, or the Unabomber. Instead of eschewing technology as a means to greater human perfection, we are better off intelligently managing the dangers. Since the worst consequences of human arrogance result when one person or group of persons is able to impose a vision of perfection on the rest of us, our best defense against these consequences is to embrace free, open, and decentralized systems for developing technologies. By empowering individuals, not states, and certainly not technocratic “experts,” we not only avoid the pitfalls of permitting one error to harm us all, but we also ensure that fewer errors will be made, since such a decentralized system of free choices will permit the greatest possible harnessing of local knowledge. While it is certainly arrogant for any particular individual to suppose that she has the knowledge to determine the best outcomes for the whole human species or even some significant part of it, the wisdom of the whole system of free individual choices is our best insurance against becoming an exclamation point at the end of a grand Promethean tragedy.

Misinformation through the Internet

AUTHOR

Anton Vedder
Tilburg University,
Faculty of Law
Tilburg University,
Schoordijk Institute,
Faculty of Law
Tilburg,
The Netherlands

ABSTRACT

The Internet has become one of the most consulted sources of information. An essential characteristic of the Internet is its many-to-many character. People who seek information can access the medium without much difficulty. For people who provide information it is almost equally easy to distribute information. Because of both the ease with which the information is accessible and the ease with which information can be dispersed, it is also relatively easy to be misled and to mislead, intentionally or unintentionally.

Because information on the Internet can be the basis of moral decisions and actions, the reliability of that information is morally significant. The exact character of the problematic status of misinformation through the Internet can be made more explicit by some reflection on criteria for assessing the reliability of information. In judging the reliability of information, we can use primary criteria of reliability. These are, for instance, requirements of consistency, coherence, accuracy, and accordance with observations.

Now, seekers of information themselves are often unable to assess the reliability of information in relation to the aforementioned primary criteria. They are mostly no experts, and sometimes lack even the slightest knowledge of the topics about which they seek information. This applies equally to information published through the traditional media and to information published through new media such as the Internet. In order to judge whether one can trust the quality of information in the traditional media, most people seem to apply what I will call secondary epistemic criteria.

Secondary epistemic criteria have to do with the authority, trustworthiness and credibility that are assigned to persons or organizations behind the information. Viewed rather superficially, this assignment of authority, trustworthiness and credibility may seem to happen on the basis of just the history of these persons or organizations, their reputation or their having others standing surety for them. On a deeper level, however, the application of secondary epistemic criteria appears to be based on an intricate complex of backgrounds of all kinds of manifest or latent recognition procedures for persons and organizations, traditions of reputations and usage. Most of these are built in or embedded in conventions, social and institutional arrangements and practices.

People look for traces of the reliability of the information and of the information provider by gathering all kinds of indications about the background and the institutional setting of the source of information. People can find out, for example, whether the provider works at a university, what kind of university this is, whether it has a good reputation, whether it is recognized as one where people work according to commonly accepted methodological criteria, etc. Also, people seem to be attentive to the context in which the information is offered or made accessible, such as a university library, a reputed scientific journal, etc.

The very possibility of applying these kinds of secondary criteria is often lacking where the Internet is concerned. Often, the content provider is anonymous or has only a virtual identity. Generally, the influence of individuals in the process of providing information on the Internet is diminishing, whereas the influence of intelligent systems is growing. Also, the lack of traditional intermediaries (such as libraries, librarians, specialized publishers) may have a negative influence on the capabilities of information seekers to assess the reliability of information. These kinds of factors, i.e. the lack of information about content providers, the diminishing human influence in the provision of information, and the lack of traditional intermediaries, are responsible for the fact that an information seeker often lacks clues or any indication whatsoever about the character, background, and institutional setting of the content provider.

Adding to and further complicating the problem is the globalization which goes hand in hand with the Internet. Even when the recipient has some information about the content provider, he might not be able to estimate the credibility of that provider. This is so, simply because often he will not be acquainted with backgrounds and institutional settings from all over the world, completely different societies, with completely different cultures. The recognition procedures and traditions that make up the institutional basis of the application of secondary epistemic criteria may be different in different cultures. A recipient from one culture may not recognize the procedures and traditions of the provider from another culture. It could even be, that if the recipient from one culture were able to recognize them, he or she would not accept them.

Possible solutions to the problem of misinformation through the Internet, to my mind, are to be found in two strategies. These are not mutually exclusive but rather mutually supportive.

The first strategy is one of developing critical attitudes in recipients. The second strategy consists of enabling people to apply secondary epistemic criteria to the Internet by creating (an analogue of) the institutionally embedded credibility conferring systems.

Specifying and implementing the two strategies as such is already difficult. Additional complexities, however, arise from the obvious possibilities of normative conflicts between the realization of reliability enhancing measures on the one hand, and normative principles regarding individual autonomy, the freedom to provide and to gather information, and privacy norms, on the other hand. For reasons of enhancing reliability of information on the Internet one may, for instance, consider restricting the possibilities of dispersing information anonymously. Doing so, however, may be detrimental to privacy and to the freedom of speech. Something similar will be the case with teaching people and enabling them to take a critical distance towards information on the Internet. A point where empowerment of individuals changes into paternalistic meddling is all too easily attained.

Finally, the prevailing global moral pluralism must be taken into account when credibility conferring systems are designed or renovated, not only because different moral outlooks and varieties of moral viewpoints perhaps ought to be tolerated and respected. It is rather a matter of effectiveness. Where systems clash with deeply felt convictions, they will not be accepted.