The Impact of the Internet on Business

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The Impact Business

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Current Uses of the Internet
The Internet has a wide variety of uses. It provides an excellent means for disseminating information and communicating with other people in all regions of the world. While the greatest use of the Internet has been sharing information, other sources of use are rapidly developing. For instance, chat rooms, a space where people can go to discuss an assortment of issues, and Internet Commerce, which connects buyers and sellers online. The following are other examples of current Internet uses:

1. Technical Papers
Originally, the Internet was only used by the government and universities. Research scientists used the Internet to communicate with other scientists at different labs and to access powerful computer systems at distant computing facilities. Scientists also shared the results of their work in technical papers stored locally on their computer system in ftp sites. Researchers from other facilities used the Internet to access the ftp directory and obtain these technical papers. Examples of research sites are NASA and NASA AMES.

2. Share Company Information
Commercial companies are now using the Web for many purposes. One of the first ways that commercial companies used the Web was to share information with their employees. Sterling Software's Web page informs employees about such things as training schedules and C++ Guidelines. There is also some information which is company private and access is restricted to company employees only. Another company example is Sun Microsystems which similarily contains general information about the Sun Microsystems company.

3. Product Information
One of the ways businesses share information is to present their product information on a Web page. Some examples are: Cray Research, Sun Microsystems, Hewlet Packard, and GM's Pontiac Site. The Web provides an easy and efficient way for companies to distribute product information to their current and potential customers.

4. Advertising

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Along these lines, companies are beginning to actually advertise online. Some examples of different ways to advertise online are Netscape's Ad Page. Netscape has a list of advertising companies. They also use a banner for advertisements on their Yahoo Web Page. Starware similarly uses banner advertisement. These advertisements are created in the established advertising model where the advertising is positioned between rather than within editorial items. Another type of advertising focuses on entertaining the customers and keeping them at the companies' site for a longer time period. Some of the more interesting of these are:
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MCI with a soap opera/ detective story. Ragu Soap Opera, Italian art, prizes, etc. Stoli Puzzles, submit drink receipes, prizes, etc. Miller Genuine Draft Discussions on various topics such as music scene in Austin.

The advantages of each method of advertising will be discussed in more detail in the section on strategic risks and target markets.

5. Business & Commerce on the Net
Commercial use restrictions of the Internet were lifted in 1991. This has caused an explosion of commercial use. More information about business on the Internet can be found at the Commerce Net. This site has information such as the projected growth of advertising on the Internet and online services. Commercial Services on the Net has a list of various businesses on the Internet. They are many unusual businesses listed here such that you begin to wonder if they are legitimate businesses. This topic is discussed in more detail in the section on risks and consumer confidence. Business and Commerce provides consumer product information. The Federal Trade Commission is also quite concerned about legal business on the Internet. WWW users are clearly upscale, professional, and well educated compared with the population as a whole. For example, from CommerceNet's Survey (CommerceNet is a not for-profit 501c(6) mutual benefit corporation which is conducting the first large-scale market trial of technologies and business processes to support electronic commerce via the Internet) as of 10/30/95 :




25% of WWW users earn household income of more than $80,000 whereas only 10% of the total US and Canadian population has that level of income. 50% of WWW users consider themselves to be in professional or managerial occupations. In contrast, 27% of the total US and Canadian population categorize themselves to have such positions.

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64% of WWW users have at least college degrees while the US and Canadian national level is 29%.

CommerceNet's study also found that there is a sizable base of Internet Users in the US and Canada. With 24 million Internet users (16 years of age or older) and 18 million WWW users (16 years of age or older), WWW users are a key target for business applications. Approximately 2.5 million people have made purchases using the WWW. The Internet is, however, heavily skewed to males in terms of both usage and users. Access through work is also an important factor for both the Internet and online services such as America Online and CompuServe. For an example of the size of the market, the total Internet usage exceeds online services and is approximately equivalent to playback of rented videotapes.

6. Magazines
Magazines are starting to realize that they can attract customers online. Examples of magazines now published online are Outside, Economist, and Business Week. These magazines are still published in hard copy, but they are now also available online. Many of these publications are available free sometimes because of the time delay (i.e. publications online are past issues) or usually to draw in subscribers for a free initial trial period. Some of these publications may remain free online if advertisers pay for the publications with their advertisement banners.

7. Newspapers
Some newspapers are beginning to publish online. The San Jose Mercury News is a full newspaper online, while the Seattle Times offers just classified ads and educational information. The Dow Jones Wall Street Journal publishes its front page online with highlighted links from the front page to complete stories. The Journal also provides links to briefing books, which provide financial information on the company, stock performance, and recent articles and press releases. For an example of a briefing book see, Netscape Briefing Book. This is all free by the Wall Street Journal during the trial period which should last until mid 1996.

8. Employment Ads
Companies are also beginning to list their employment ads online to attract talented people who they might not have been able to reach by the more tradition method of advertising in local papers. Sun Microsystems provides a list of job openings on the Internet. Interested parties can submit a resume or call to schedule an interview, which saves time for everyone involved. Universities can also help their students find jobs more easily by using job listings on the Internet. The University of Washington has a job listing site. Local papers can
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also make it easier for job searchers by creating a database search feature. The job searchers can select the type of jobs that they are interested in and the search will return a list of all the matching job openings. San Jose Mercury News is a good example of this approach.

9. Stock Quotes
There are several time delayed (15 minutes) ways to track stock performance, and they are all are free. The first to provide this service was PAWWS Financial Network, and now CNN also lets you track stocks. These are commercial companies which provide stock quotes for free but charge for other services. A non-commercial site, MIT's Stock & Mutual Fund Charts, updates information daily and provides a history file for a select number of stocks and mutual funds. Information in these history files can be graphically displayed so that it is easier to see a stock's performance over time.

10. Country Investment Information
Thinking about investing in a particular country? Information on countries can be found online. For example, check out the graphical information (GDP, inflation, direct foreign investment, etc.) on Indonesia.

11. Order Pizza
You can order a pizza online. This Web site is actually a joke, but you can easily imagine people working late at their offices and ordering out for food online.

12. Software Distribution
A very effective and efficient use of the Web is to order software online. This reduces the packaging and shipping costs. Also documentation can now be provided online. A good example is Netscape Navigator. Another example is Macromedia's Shockwave. What is Shockwave for Director? The description online is as following: "Shockwave for Director is the product name for the Macromedia Director-onthe-Internet project. Shockwave for Director includes two distinct pieces of functionality: (1) Shockwave Plug-In for Web browsers like Netscape Navigator 2.0 which allows movies to be played seamlessly within the same window as the browser page. (2) Afterburner is a post-processor for Director movie source files. Multimedia developers use it to prepare content for Internet distribution. Afterburner compresses movies and makes them ready for uploading to an HTTP server, from which they'll be accessed by Internet users."
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So by reading about the product online, you can decide if it sounds interesting. You can then immediately get the software by downloading it from Macromedia's computer to yours. Next, you install it on your system and you're all set. You didn't even have to leave your terminal, and there was no shipping cost to you or the company.

13. Traffic Information
Ever wonder what the rush hour traffic was like before you head home and get stuck in it? Many different cities are putting traffic information online. In Seattle, a graphical traffic report is available.

14. Tourism
Plan a trip to Australia or New Zealand with information gathered off the Internet. These and other countries are on the Internet. So you can plan your vacation from your computer.

15. Movie Previews
Who needs Siskel and Ebert, when you can be your own movie critic? Buena Vista Movie Clips provides movie clips from many of their new releases. For a sample movie clip preview "Unstrung Heroes".

16. Chat Rooms on AOL
Chat rooms are a more interactive technology. America Online provides areas where people can "log on" and converse with others with similar interests in real time. This is the first popular use of interactivity by the general public. The other uses up until recently have been more static, one-way distribution of information. Interactivity is the future of the Internet (See the next section).

Forecast of How the Internet & WWW Might Be Used in the Future
There are many ways that the Internet could be used in the next 3 to 5 years. The main aspect that they all have in common is the increased use of interactivity on the Internet. This means that the Internet will shift from being a one-way distribution of information to a two-way information stream. Scientists will continue to lead the way in this area by watching the results from scientific experiments and exchanging ideas through live audio and video feeds. Due to budget cuts, this collaboration should be expected to increase even more to stretch what budget they do have. (For more information on this, check out
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Business Week article on science and technology "Welcome To The World Wide Lab" 10/30/95.)

1. Interactive Computer Games
One of the first areas where interactivity will increase on the Internet are computer games. People will no longer have to take turns playing solitary or crowd around one machine. Instead they will join a computer network game and compete against players located at distant sites. An example of this is Starwave's Fantasy Sports Game. This game is still a more traditional approach of updating statistics on the computer and players looking at their status. A more active game is Marathon Man, which portrays players on the screen reacting to various situations. In the future, many of these games will also include virtual reality.

2. Real Estate
Buying a home online will become possible. While very few people would want to buy a home without seeing it in person, having house listings online will help reduce the time it takes to purchase a home. People can narrow down which houses that they are actually interested in viewing by seeing their description and picture online. An example is this list of house descriptions by region of the country. This will be improved when database search capabilities are added. People can select the features that they are interested in and then search the database. In response, they will receive a list of houses that meet their criteria. Also, having several different images of the House as well as a short video clip of a walk through of the house, will help buyers make their selection quicker. This area is growing quickly. For example, the following sites of interest to the West Coast were added online since the writing of this paper: Windermere Real Estate, Fractals, and Listinglink.

3. Process Mortgages online
After a house is chosen, potential buyers can apply for a mortgage online. No longer will buyers be restricted to local lending institutions, since many lenders will be able to compete online for business. Visit an example of an online mortgage computation. In the future, each lender will have a Web page which will process the mortgage application. One of the main reasons this has not been implemented is security, which is discussed further under the strategic risks and security section.

4. Buying stocks
Stocks will soon be able to be purchased over the Internet without the assistance of a broker. Charles Schwab has a prototype that is being tested currently in
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Florida. Once the security issues are ironed out, this application will also be active.

5. Ordering products.
Ordering products online is an important application. As mentioned above, the Pizza Page showed how easy it could be done. Other companies are setting up Web pages to actually do this. An example is TSI Soccer. Customers can actually order online if they choose to do so. They can even send their credit card number over the network. Since this is non-secure, most people probably still call the company to order any item.

6. Live Video
Viewing live video clips will become more common in the future. CNN has files of video clips of news stories at video vault which can be downloaded and viewed on a home computer. Seeing actual live video feed is dependent on network speed, and most home users do not have fast enough connections to make this a practical application yet. This is discussed in more detail under the section strategic risk and speed of network access. Once the speed of network connection increases, more people will be interested in live video clips.

7. "Chat" Internet Telephone
While AOL users are currently accessing "Chat Rooms" to communicate with other people on the Internet, they are restricted to text-based communication or possibly an icon as their identity online. CUCME from Carneige Mellon provides a means for people to actually see other people online. However, network speed is once again a limiting factor. If a user is not directly connected to the Internet (most connections are via modem), then the image is extremely slow. This application will become more popular with increased network connections.

8. Video Conferencing
On the other hand, businesses will begin using video to communicate with others. Andersen Consulting is setting up training online. There should also be some applications that businesses can choose to help set up video conferencing. IBM bought LOTUS Notes for this reason last summer. IBM needs to make it a more flexible solution by interacting LOTUS Notes with the Internet. They currently are in the process of doing this. Netscape also offers a solution based on the software company Collabora that they purchased last fall. These possible solutions should encourage businesses to use video conferencing and online training. Additional information on Video Conferencing is also available.

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Strategic Risks Associated with Business Uses of the Internet
1. Targeting right market segments.
It is important for advertisers to spend their advertisement dollars wisely. They can achieve this by using appropriate methods of advertising and targeting the right market segments. Two different types of advertising are entertainment ads and traditional advertising. Entertainment ads focus on entertaining a customer whereas traditional advertising is more direct and usually positioned between rather than within editorial items. When the entertainment ads work well, they can be quite successful in drawing customers to their site; however, it is very easy for this type of ad to flop resulting in no one returning to visit the advertisement site after they see it once. Traditional advertising has better readership. It can also be used well in targeting the right market segments. For instance, the ESPN Sports page would be a good site to place ads by Gatorade and Nike. Sports minded people that might be interested in these products would be likely to access these pages. A good reference for researching this topic further is at Advertising Age.

2. Security
One of the main factors holding back businesses' progress on the Internet, is the issue of security. Customers do not feel confident sending their credit card numbers over the Internet. Computer hackers can grab this information off the Internet if it is not encrypted. Netscape and several other companies are working on encryption methods. Strong encryption algorithms and public education in the use of the Internet should increase the number of online transactions. After all, getting your credit card number stolen in every day transactions is easier. In addition, securing private company information and enforcing copyright issues still need to be resolved before the business community really takes advantage of Internet transactions. There are, however, currently some methods within Netscape for placing the information online yet restricting it to only certain people such as company employees.

3. Consumer confidence
Consumer confidence is essential for conducting business online. Although related to security, consumer confidence also deals with feeling confident about doing business online. For instance, can consumers believe that a company is legitimate if it is on the Internet, or could it be some kind of boiler room operation? Also, companies must be able to substantiate their advertising claims if they are published online. These are some of the issues that concern the
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Federal Trade Commission, as well as the future of Internet commerce. After all, if consumer confidence is low, businesses will not succeed.

4. Speed of network access
The speed of network access is a risk for businesses. If businesses spend a lot of money for fast network connections and design their sites with this in mind yet customers have lower speed connections, this may result in less consumers accessing their site. Less consumers accessing their site most likely results in lower profits which is in addition to the extra cost of the faster network connection. On the other hand, if the company designed for slower access yet customers have faster access, they could still lose out in profits. Currently, some of the options that home users have to choose from are traditional modems, ISDN, and Cable Modems. Traditional modems are cheaper but the current speed is a maximum of 28.8 Kbps. ISDN is faster at 56 Kbps, but more expensive. Cable modems are faster yet with a speed of 4 Mbps. However, twoway interaction with a cable modem needs some more testing to be sure that it works as well as ISDN.

5. Picking Wrong Industry Standards
Along these lines of picking industry standards, companies must also be sure that the Web Browser that they develop for is the standard. Otherwise, some of the features that they are using to highlight their site may not work. Currently the defacto standard is Netscape. There also needs to be a standard language that adds high quality features such as animation, so that software applications written for the Internet will run on all the different types of architectures customers may have. Major computer industry players have backed JAVA by Sun Microsystems. So while some areas are becoming standardized, companies must be alert to industry changes to avoid becoming obsolete in hardware, software, and data communications.

6. Internet Community & Philosophy
The Internet was originally developed with a philosophy for sharing information and assisting others in their research. The original intent emphasised concern for others, technological advances, and not for profit organizations. With the lifting of commercial restrictions in 1991, businesses are now joining the Internet community. As with any small town that has a sudden increase in population, fast growth can cause problems. Old residents could create animosity if they feel that the new residents are taking over their community and causing congestion and prices to increase. Businesses need to be conscious of this phenomenon.
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While businesses can expect help from Internet users, businesses will lose this help if they only use it to make a quick profit. As in a large city, people will start to feel less like helping others in need. Businesses will be more successful on the Internet if they can emphasize how they can help add value to the Internet rather than focusing on how to make a quick profit. For example, businesses can take advantage of the opportunity to provide additional Internet services (e.g., services discussed in the sections on current uses of the Internet and future uses) now that funding from the government is being reduced. An example of a city that has grown rapidly, yet still considered very livable, is Seattle. One of the reasons attributed to Seattle's successful growth is, that despite it being a large city, there are numerous small communities within the city. These small communities retain such benefits as concern for others within the framework of services that a large city can provide. If businesses along with the Internet community follow this model, the Internet will have a chance to keep its successful small town atmosphere while adding increased services for more people.

Conclusion
The Internet is a dynamic environment. While there are many risks involved with change, there can be many benefits. This paper has given some ideas on possible benefits and possible risks. Now it is up to each business to decide if the potential benefits outweigh the potential risks. Hopefully, we'll see you on the Web!

Group 33's Home Pages:
To show another way of communication on the Web, we created our own home pages to market ourselves and display our expertise in Web technology.

John Richard Jamee Lisa D.K. Yoon

VanderSluis

Attala Chun Fields Whitney

Here's a short quicktime movie(406kbytes) of our group.
Note: All links from this page were checked when implemented. However, the Web is in a constant state of flux. Site adminstrators may be updating their Web pages. So if a link doesn't work today, try again later and it probably will. Last update: [email protected] March 5, 1996.

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Lesson 2: The Impact of the Internet on Business and Industry
More and more organizations are getting hooked into the Internet. They use the Internet to promote and sell their products and services, provide customer support, deliver training, and share corporate information with clients, employees, and customers. Businesses have found that the Internet is a powerful tool to help keep their employees and customers connected. After reading this lesson, you should be able to:
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Compare the uses and implementations of Intranets and Extranets. Describe uses and types of e-commerce sites. Discuss the impacts that the Internet and WWW are having on business, government, education, and communities.

Intranets
The term intranet was coined because it is internal to a company while continuing to utilize Internet technologies. An intranet is a private network of computers that is internal to a company and is used to share information throughout the organization. Just like the Internet, intranets also use Web browsers, email, and FTP to assist in information sharing. These private networks are typically built within a Firewall, a security system designed to protect an organization's network from external threats. In many cases, corporate intranets allow internal users access to both their internal network and also the Internet. This provides users with the ability to search and share internal corporate knowledge while accessing external information sources such as clients and competitors.

Extranets
Extranets are becoming a very popular means for business partners to exchange information. An extranet is basically an intranet that is partially accessible to authorized external users. Whereas an intranet resides behind a firewall and is accessible only to people who are members of the same company or organization, an extranet provides various levels of accessibility to outsiders. You can access an extranet only if you have a valid username and password, and your identity determines which parts of the extranet you can view. Usually these users are customers and suppliers. Typically, access to the network is for business transactions, such as order placing or documentation gathering.

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The most common uses of an extranet are to:
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Exchange large amounts of data Distribute product catalogs Collaborate with other companies on joint development efforts Deploy training programs with clients and other companies Disseminate news with partnering companies

E-Commerce

Electronic Commerce or e-commerce is the conducting of business communication and transactions through the utilization of network computing or communication technology. Basically speaking, it is any activity or venture that represents a business transaction or utilizes electronic data interchange to complete the transaction. More simply put, if a company conducts business via the Internet, they are participating in electronic commerce or e-commerce. Two of the most common examples of ecommerce activities include:
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The buying and selling of goods and services by means of the WWW or the Internet The conducting of on-line or Internet banking activities

When discussing e-commerce activities, there are four basic types of e-commerce interactions. They are: Business-to-Consumer, Business-to-Business, Consumer-toConsumer, and Intrabusiness e-commerce.

Business-to-Consumer E-Commerce
Business-to-Consumer e-commerce (B-to-C or B2C) is the sale of goods and services to the general public. Typical business-to-consumer activities include the purchasing of airline tickets, books, clothing, flowers, computer hardware, and computer software.
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Business-to-Consumer activities do not necessarily have to be the purchasing of physical products; it can also include the purchasing of a service such as an on-line subscription to journal or the registration of an on-line course. A primary benefit of business-to-consumer e-commerce is that a customer has the ability to locate products or services that may be normally unavailable to them. Secondly, the consumer has the ability to search multiple locations in an attempt to find the cheapest price.

Solutions Scenario
"Business leaders everywhere are racing to embrace the Internet. David Siegel, web strategist, says 'Do not redesign your website. Redesign your company.' The real opportunity of the Internet era, he argues, is not the 'False God' of E-Commerce. It's the chance to rethink your relationship with customers, to figure out which customers are right for you and to put them in charge of your company. " * Mieszkowski, Katherine. "Let Your Customers Lead." Pages 210-226. Fast Company. April 2000. Quotes are from David Siegel, Web Strategist.

Business-to-Business E-Commerce
Business-to-Business e-commerce (B-to-B) occurs when companies communicate with other businesses in an attempt to provide customers with the goods and services they request. The goods and services exchanged can include online advertising, recruiting, credit, sales, research, and technical support.

Solutions Scenario
In business, it's who you know and what they know. There is an old saying, "Find a niche and fill it." Unfortunately, this makes it impossible to be all things to your customers, so businesses have found it beneficial to partner with other organizations. Business-to-business sales were estimated to be worth $8 billion in 1998. By 2002, it is projected that b-to-b sales will total $327 billion for the United States, and as much as $1.3 trillion globally (McGraw, 1999).

Consumer-to-Consumer E-Commerce
Consumer-to-Consumer E-commerce (C-to-C or C2C) occurs when consumers exchange goods and services among each other. This is typically done through online auctions where a person can try and sell a product by having other people, potential customers, bid on the product.

Solutions Scenario
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A new Internet company is hoping to turn the massive file-swapping communities developed by technologies like Napster and Gnutella into an e-commerce engine. The company, called Lightshare, is preparing a service that will allow individual computer users to sell digital goods directly from their computers rather than going through centralized servers from companies like eBay or Amazon.com. It is staffed largely with former Netscape, America Online and Time Warner engineers, and is funded by executives from Microsoft, Netscape Communications, and Google. CNET.com July 20, 2000 Start-up to fuse file swapping with e-commerce. John Borland. CNET News.com. July 20, 2000, 12:55 p.m. PT

Intrabusiness E-Commerce
Intrabusiness e-commerce is the utilization of Web-based technologies to handle any and all electronic transactions that may occur internal to a company. The purpose of intrabusiness e-commerce is not to generate revenue for a company but to help organize and streamline its operations. For example, a company can keep an inventory of all its office supplies by setting up a centralized office supply location. If employees need a supply, they could go to the corporate e-commerce site, search for the product or products they need, and submit a request.

Knowledge Check
Business-to-Business, Business-to-Consumer, and Consumer-to-Consumer Ecommerce are a few of the ways: A. B. C. D. The Internet and WWW are changing business and organizations. Web-based technologies are being used to handle any and all electronic transactions that may occur internal to a company. Businesses attempt to provide customers with the goods and services they request. Customers can use these to locate products or services that may be normally unavailable to them.

Implications of the Internet
The advent of the Internet has generated a plethora of opportunities for businesses, communities, educational institutions, and even the government. It has opened up

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new opportunities for organizations to communicate, collaborate, and disseminate information. Business - The Internet has provided businesses with the ability to extend their revenue-making opportunities by selling products and services online. They are now able to utilize Internet technologies such as FTP and the World Wide Web to provide customers with the ability to receive technical support or download product documentation. Furthermore, businesses are taking advantage of Internet technologies to stay competitive with other businesses through extensive Internetbased research. Communities - Communities are reaching out and providing ways of keeping up with local events by posting community calendars. Furthermore, local Web sites are being developed to provide information regarding industries, business, sports, and job openings. Finally, local stores have started developing Web sites to display information such as sales or promotions. Educational institutions are starting to introduce online courses, providing an opportunity for people to take courses who may normally not be able to take them. Educational institutions are also developing their library systems to be viewable and searchable over the Internet, allowing people to do research away from the library, in remote locations. Furthermore, faculty members are using the Internet to provide supplemental course materials such as syllabi, assignments, course calendars, and class notes. Government Agencies - Government agencies have started to utilize Internet technologies to communicate and dissemination public information. Web sites, FTP sites, and mailing lists are created in an attempt to make public government knowledge easily accessible. Furthermore, government agencies have implemented numerous intranet and extranet sites, providing them with secure networks enabling a secure means of transferring and storing data.

Solutions Scenario
TCP/IP (Internet) connections were originally created to help us strategically prevent a breakdown in communication in disaster situations, such as nuclear war. These connections allowed scientists and military personal to continue communicating when a part of the network was destroyed. Since the beginning, the initial concepts of the Internet have grown, allowing the transfer of information and interaction between people and organizations all over the world. To this day, there are more than 70 million hosts connected to the Internet. Governments, including the United States, have trusted special intranets to transfer and store important information securely. In addition, a great majority of the defense systems and financial systems are dependent on the smooth running of TCP/IP and other network connections. Because of their importance in our lives and the secure
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information they store, these systems have become targets for hackers in many countries. Many writers have argued that the biggest threat to the United States Military is no longer a traditional war, but a "Cyber-war," where networks will be hacked and data stolen, erased or made to malfunction. This is ironic, since the original goal of the TCP/IP networks was to aid the military in times of disaster, certainly not to become a potential disaster situation!

Lesson Wrap-Up
Individuals and organizations are finding many uses for computer networks and the Internet. Now, more than ever, people are discovering the benefits and costs of being connected. Intranets and Extranets are becoming a common means of communicating within and between organizations. E-commerce, whether it be B-to-C or B-to-B, is booming and is now a significant force in our economy. One of the most important driving forces behind the growth of e-commerce around the world is the utilization of Web-based technologies for handling business and other types of transactions electronically. Using the Internet, organizations can cut costs, improve the effectiveness of many activities and, in some cases, increase profitability and market share. The Internet is influencing almost every type of human endeavor. Now that you have completed this lesson, you should be able to:
  

Compare the uses and implementations of Intranets and Extranets. Describe uses and types of e-commerce sites. Discuss the impact that the Internet and WWW are having on business, government, education, and communities.

Lesson 3: The Sociological and Ethical Impact of the Internet
Did you ever wonder what it was like to live during the advent of the printing press? If you think about it, it is not that much different than the time we are living in now. The Internet and WWW technologies are transforming the way we live, the way we do business, and our society in general. With this transformation comes great issues to debate and many moral dilemmas for our society to face. After reading this lesson, you should be able to:
  

Apply basic "netiquette" procedures and guidelines. Discuss how the Internet and WWW impact our personal privacy and the security issues involved. Synthesize the arguments around pornography and censorship on the Internet and WWW.
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Discuss the impact that the technology divide could have on our society.

Basic Netiquette Procedures
Netiquette, or Internet etiquette, is the basic behavior "code" to help guide Internet users in this new medium. Much like the way we have developed standards of use for the telephone, netiquette has been developed to help give users guidelines for using the Internet. For example, we all know that it is rude to hang up the telephone on someone without saying good-bye. And we know that when at work it is polite to answer the phone by saying what business and person you have reached. Basic codes of conduct generally evolve around most technological innovations and information systems. Much like other ethical areas of discussion, the best netiquette principle is the Golden Rule (or to treat others like you want to be treated). More specifically, however:
      

  

Do not forward junk email (generally called "spam") or hoaxes (always check them out before sending them to your whole address book!) Do not send or post "flames," which are rude or insulting messages. Always try to keep messages short and to the point. Spell check your messages and documents. Follow traditional writing format. Do not use all lower or upper case letters and ellipses (it makes messages hard to scan quickly). Remember that sarcasm may be misinterpreted in writing. Do not say anything in an email that you would not say to someone's face. (A good example: an employee replied to a coworker's message about a meeting with a very negative response blasting the reason for the meeting and the boss for calling it. Unfortunately, the message was sent to the business list serv and when the employee replied to it, the whole list got a copy. Oops.) Always double-check your Internet sources. Many times, information may be there for test purposes, educational purposes, or for no good purpose at all. Use emoticons to express emotion that you would normally convey through gestures. Some examples would be, :) for a smile, or :( for a frown. Use abbreviations like BTW (by the way), FYI (for your information), IMHO (in my humble opinion), and TYVM (thank you very much).

How the Internet and WWW Impact our Personal Privacy
The Internet revolution is creating, or reinventing, a multitude of issues for social discussion. The social implications of the digital divide ("haves vs. have-nots"), the learning implications of online education, and the business implications for the corner book store put out of business by Amazon.com are only a few that come to mind. As a future knowledge worker, you will have to deal with all of these issues and many
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more that have not even surfaced yet. Think about how much society has changed in the last few years because of Internet technologies, and think about how much more we will change in the coming years. One issue, however, has been garnering a lot of attention: privacy. When we speak of privacy, we do not necessarily mean privacy in your backyard, or privacy of your decisions, but information privacy, which is the right to control how your personal information is collected, used, and passed along to others. The Internet and World Wide Web have the power to connect people, provide instantaneous, individualized service, and make volumes of information available. But is this all at a cost to our privacy? The technology industry and governments of most industrialized nations are dealing with this very question. Many of us use the Internet and other technologies every day but are not aware of what is going on behind the scenes. Many technologies and methods may be assisting in the capture of your personal information. Although this list is certainly not exhaustive, the following technologies are the most talked about "villains": 1. Business-to-business sale of private information 2. Broadband technologies that allow for open access to your systems 3. Non-secure e-business sites.

Privacy Violations: Information as a Commodity
If you listen to the technology news at all, you are guaranteed to hear about "B to B" transactions. This simply means that businesses are selling goods, services, and yes, information, to other businesses utilizing Internet technology. Many times this is harmless ... the Daimler-Chrysler company buys a major shipment of parts from Mopar, Inc., using their secure, business-to-business e-commerce site. For the same reasons as consumers, companies are using e-business to have better access to their suppliers and vendors. As part of this trend, information has become quite a commodity on the Web. Many Internet sites capture your personal information, such as your email address, link preferences, buying habits, Internet usage habits, and anything else that could possibly be captured. This is done utilizing many different types of technologies including the much-maligned "cookies." Cookies are typically written with a scripting language, such as JavaScript, to capture user information/preferences that is then written to your local hard drive. Many companies carry on this practice for legitimate reasons. For example, Web developers might collect this data to service you better when you get to their site, to target advertising more appropriately, or to insure that the technology used on their site is compatible with the your system. However, many companies capture this same

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information and sell it to other businesses that may use it unscrupulously. If you ever get junk e-mail, somewhere along the line, your personal information has been sold. The implications here are obvious. If they can sell my e-mail address, could they sell my medical history? What might happen to my insurance rates if they find out that I have a medical condition? This issue is not an easy one to solve. We cannot easily control how our health care providers exchange information. However, the casual Internet user can protect him or herself by not giving out personal information, as well as always checking that "little box" that says you DO NOT want your personal information sold or distributed to others. In addition, in your browser's preferences, you can typically disable cookies or tell your browser to alert you before accepting one.

Privacy Violations: Broadband Technology
A second threat to our privacy is the growing use of broadband technology. In simple terms, broadband is generally considered a high-speed connection to the Internet through a cable modem or DSL line. Connecting to the Internet using broadband technology provides users with a much richer online experience, allowing them to quickly download graphics, movies, music, and high-level multimedia. However, there is, of course, a downside to this technology that may not seem apparent at first. Because a broadband connection is always "live" (i.e., you don't have to dial up, you are always connected), it is much easier to hack into a local system and create major problems for the owner of that system. Anyone with some skill can access your computer, read your files, steal information, or completely sabotage your system. The privacy implications here are very scary. How can you protect yourself from this kind of threat? Most businesses that have high-speed networks are behind "firewalls" which generally do a good job of keeping hackers out. The home user is not quite as lucky. But as with any threat, there is always an opportunity for entrepreneurship. The future will probably be filled with an onslaught of security software for home users that protect systems with a constant, live connection to the Internet. The future will probably also be filled with computer crime that is more sophisticated and insidious in our society!

Privacy Violations: Web Site Security
Another way in which your privacy is jeopardized on the Internet has to do with the security of Web sites. E-commerce sites have become all the rage with businesses selling everything from garden hoses to groceries to grand pianos. Businesses and consumers are taking advantage of the ability to buy and sell

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whatever they want, whenever they want it, without leaving their homes or offices. Most sites employ very strict security rules so that personal information or credit card information is not stolen during a transaction. However, not all sites are created equal and many do not protect your information adequately. When a transaction is sent from your computer to the e-commerce site's server, a smart hacker can steal all of the information related to it (if the site is not well-secured). Most secure sites utilize powerful encryption methods to scramble and then unscramble the transaction information. If a site is not secure, the information can be captured and a "cyberthief" may end up with your personal information or credit card account numbers. The implications to privacy are troublesome here because of that loss of personal information, and quite possibly hefty unauthorized charges to your credit card. The lesson for the consumer here is to guard your personal information carefully. Generally, a secure site will cause the little padlock on the bottom of your browser window to appear locked. If the icon is unlocked, DO NOT provide any personal information that you would not want the world to know. After reviewing some of the major privacy "violators," it is easy to see how we are losing control of our personal information because of new Internet technologies. Most are not intended to be malicious, but when in the hands of criminals or those without morals, they can potentially rob you of your private information. So, what is the answer? There are no easy answers; however, there are methods that could be used to minimize risk. For example, clear statements about how gathered information may be used could become the law (or just the norm, if the Web stays self-policed) for all Web sites. Or, broadband Internet service providers may be required to give you security software when you sign up. Debates over changes in privacy protection measures will be extensive in the coming years. The Internet has not necessarily created these issues, but it has certainly created a pressing need to deal with them.

Pornography and Censorship on the Internet and WWW
As with many other recent technological innovations, the Internet has been impacted (and some say overrun) with pornography. For example, the proliferation of VHS videotapes and video cassette recorders was greatly increased in the 1980s because of the pornography industry. It was quickly identified that videotape was an easier way to distribute pornographic material to an audience who demands privacy. In a similar manner, the Internet has been identified as an even more lucrative way to give customers their desired product in a private way. The ability to use multimedia and ecommerce tactics on the Internet has been a perfect "match" for the needs of the pornography industry.

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As you may guess, however, the use of the Internet in this manner is very troublesome to those who use it for education and family entertainment. Parents, teachers, and administrators obviously do not want children to discover a pornographic site when they are using the Internet for age-appropriate research or entertainment. Once again, there are no easy answers. Most attempts to end pornography on the Web are deemed censorship. And maybe rightly so. For example, if we have to draw a line to say that photographs of breasts are no longer acceptable on the Web, we instantly censor many honest uses of these types of images. First, does this apply to only female breasts? Or are male breasts off limits too? What about chicken breasts? Second, many medical students use Web-based resources (that may include photos of breasts) to assist them in learning their field. Third, many doctors and researchers may look at photos of breasts or articles about breasts to make a diagnosis or further research on breast cancer. So, how can we draw that line? You can see that this is a difficult issue that needs to be tackled. No one wants young children to see pornographic material, but we also do not want to limit the great information potential of the Web. A practical answer may be the use of monitoring and censoring software. Parents and teachers can install specialized software that prevents users from getting to sites that contain pornographic images or content. Many of the software packages are not perfect (legitimate sites that contain the word "breast" as part of a recipe for chicken may get blackballed), but it is a step in the right direction.

The "Digital Divide"
Many news stories and articles talk about the technology "haves" versus the technology "have-nots." Our society is increasingly being connected by Internet technology in the form of information at our fingertips and access to people through e-mail. However, those who do not have the hardware, software, and technology to get this access are increasingly at a disadvantage to those who do. For example, a wealthy school district may have new, internet-ready computers in every classroom. On the opposite end of the spectrum, a poorer district may be lucky to have one old computer in the whole school. Certainly, the students at the wealthier district are more prepared to become the knowledge workers that our society will demand. They have access to richer information sources, experts in every domain, and virtual trips to major landmarks across the world. Not only do the students in the poorer district not have access to these things, they are not learning how to use any of the current, associated technologies.
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And this is only the technology divide in the United States. Compare our situation to countries where not only are there no computers to use, but there are very few telephones, televisions, or for that matter, indoor plumbing. How will these countries ever catch up to the developed world when they are not even aware of the Internet revolution taking place? These issues are not new. Wealthy school districts have always had newer textbooks and better libraries. Third-world countries have not had the same access to information in the form of radio or television as we have in the United States. But, we cannot ignore these issues simply because they are not new. The societal implications of the Internet are vast, and unknown, even this early into the revolution. We must address this "digital divide" that is taking place in our country and in our world.

Discussion Activity
Community and governmental organizations are currently focusing a lot of attention on the Digital Divide, which is the separation of Internet and technology users and non-Internet and technology users based on race, income, age, nation, or other socioeconomic factors. Many philanthropic organizations and corporations have attempted to donate hardware and software to worthy groups in order to curb the problem. Is this going to fix the digital divide? If you think about an inner city school setting, what other problems may contribute to the digital divide other than the lack of equipment?

Knowledge Check
Which of the following is a societal implication of the Internet and WWW technology that deals with the separation between rich and poor communities? A. B. C. D. Privacy Pornography Digital divide Censorship

Lesson Wrap-Up
You and I live in the era of the Internet and WWW. Therefore, some basic behavioral change is required of us to get along and become successful knowledge workers. In this lesson, we reviewed the Internet code of conduct called netiquette. The Internet and WWW have also raised many new moral and ethical questions. For example, who has the right to collect, use, and distribute your personal information using the Internet? Who, if anyone, has the right to control or censor the content of the WWW? How do we respond to the "digital divide" that is now growing between the technology
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"haves" and "have-nots"? These are just a few of the questions we must address in the new digital age. Now that you have completed this lesson, you should be able to:
   

Apply basic "netiquette" procedures and guidelines. Discuss how the Internet and WWW impact our personal privacy and the security issues involved. Synthesize the arguments around pornography and censorship on the Internet and WWW. Discuss the impact that the technology divide could have on our society.

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