Archive for the ‘internet’ Category

SkyDrive: Is Microsoft a Nanny State?

When should a corporation play the role of legal and moral enforcer? And when does a corporation start to take on the obligations — and limits — of a government?

Consider Microsoft’s Windows 8 operating system. When it was released last year, the new OS has met with mixed reviews. But at least one review, by PC World, noticed something interesting about SkyDrive, the new cloud storage service integrated into Windows 8:

“Microsoft restricts the types of files you may upload: Illegally copied commercial content is prohibited, and so are files that contain nudity or excessive violence.”

Just what does that mean? Let’s focus here just on the nudity part.

During an online Q&A session this summer, two Microsoft engineers clarified. Apparently SkyDrive’s rules mean that you are free to store your nudie pics, as long as they don’t include any child pornography. But if you use SkyDrive’s file-sharing feature, the limits are more strict: no nudity at all. So, those topless beach photos from your Mexican vacation are OK to store, but not to share. Is Microsoft checking to make sure stored erotica doesn’t include children? That’s not clear.

This raises interesting problems related to the amount of control that corporations have over everyday activities like storing computer files, especially when — as is the case with many tech companies — their services become part of the infrastructure of our lives, woven into everything we do.

Such power isn’t going to go away. But it does raise questions about the ethical standards that apply to corporate behaviour. If corporations have the kinds of power that were once reserved for states, do they then have the same kinds of obligations? Do the same standards for surveillance and search-and-seizure apply to Microsoft and its users as apply to a government and its citizens?

Of course, if Microsoft users don’t like it, they are in principle free to opt out. There are alternatives to SkyDrive — including Dropbox, Apple’s iCloud, and many others. But Microsoft’s market penetration in terms of operating systems means that for many users (especially ones who aren’t technically sophisticated) SkyDrive is the default. And default options matter; there’s a vast psychological literature on how often people simply go with the default, even when an alternative is available that would advance their interests better.

With great market power comes great responsibility.

Ethics, Law, & Workplace Social Media

Yesterday as part of the Business Ethics Speakers Series I host, we held a panel discussion on “Ethical and Legal Aspects of Workplace Social Media.”* It’s a topic that a lot of organizations are thinking about these days, and it raises a lot of tricky questions. How much control should an organization try to exert over employees use of Twitter at work? When two employees kvetch about their employer on Facebook, is that a private conversation or a public one? Is it OK for an employer to gain access to a potential employee’s Facebook profile in order to engage in screening?

For the panel, I invited three of the most thoughtful people I know on the topic. All happened to be lawyers, but all come from very different perspectives and intersect with the topic in very different ways. And all of them were interested not just to talk about the legal standards that apply to social media in the workplace, but also about the ethical principles that ought to underpin such standards.

Mark Crestohl, who chaired the panel, is AVP for Global HR Regulatory Policies at TD Bank. In his comments, Mark suggested that what is most important for employers is to explain to their employees what it expects of them when they engage in social media. Mark explained that at TD, they explain to employees that they must adhere to the bank’s usage guidelines when any one or more of three situations arise: when the employee uses equipment (e.g., a corporate smartphone) provided by the employer; when they use network access provided by the employer; or when they are discussing topics related to TD or the financial services industry. 

Panelist Dan Michaluk is a Partner at Hicks Morley, Canada’s largest HR law firm. He said his advice to corporate clients is that then need to have a social media policy that is “risk-based and culture-tuned.” In other words, cookie-cutter policies just won’t do. He also said that clear internal guidelines are important, and that guidelines and policies need to be enforced consistently. But he also warns clients to think carefully before engaging on the ‘hard cases,’ the kinds of cases that test the line between private activity and activity that causes a significant risk to an employer interest.

Finally, Avner Levin is a colleague of mine at the Ted Rogers School of Management, and Director of the Privacy and Cyber Crime Institute. For Avner, the key is to keep having a rich conversation about the issues social media raise. He pointed out that we tend to strive to behave online in ways that mimic the standards we have developed offline. But, he noted, we also seek, online, to present different aspects of our identity to different audiences — our employer, our colleagues, our family, our friends — in the same manner that we do in the real world. His plea was that we do our best to make sure that our workplace policies respect those individual needs and desires.

But that just hints at the rich discussion that went on. You can see the webcast of the event in its entirety by clicking here: Ethical and Legal Aspects of Workplace Social Media.
*The panel was co-sponsored by the Ethics Practitioners’ Association of Canada.

Twitter, Occupy, and the Rule of Law

As the 1-year anniversary of Occupy Wall Street approaches, it looks as if Twitter is finally on the verge of handing some key protestor tweets over to a New York judge. The tweets have to do with the timing and planning of a march across a New York bridge, a march that ended in mass arrests.

And, even setting aside the legal consequences of failing to do so, it’s the right thing to do. Companies have a general obligation — a part of good corporate citizenship in the most literal sense — to obey the law. There are of course exceptions, for instance in situations approximating some form of civil disobedience. Civil disobedience is best thought of as a situation in which an individual, or perhaps a company, openly defies what it takes to be a bad law or an unjust legal ruling. In classic cases, the party engaging in the disobedience does so in an attempt to effect legal change, and shows its commitment by being willing to suffer the consequences of standing on principle.

Now, tech companies like Twitter do have a principled stance to take, here. They are rightly concerned about protecting users’ data. But tweets are decidedly and emphatically public, so the present case is quite unlike the case of a company being asked to turn over customers’ emails or other private communications.

Twitter is in a sense duty-bound, of course, to put up some resistance. Being overly cooperative with law enforcement tends to look bad on a tech company, even if it’s only because people fail to distinguish between private and non-private information, or fail to distinguish between New York and Beijing. But a year’s worth of resisting is likely sufficient for Twitter to show that it takes privacy seriously. It’s time for Twitter to do its duty as a good corporate citizen in a society governed by the rule of law.

The Hidden Ethical Value of Social Networking

Like it or not, we are in the middle of a social networking revolution. And of course, that’s hardly news. Endless ink, digital and otherwise, has been spent on worrying over whether Facebook, Twitter, and their rapidly-multiplying ilk are the best or the worst thing that has ever happened to humankind.

A recent story about car-pooling apps highlights the fact modern technology, including social media, has a role to play in making markets more efficient. And since efficient markets are generally a good thing, this counts as a big checkmark in the “plus” column of our calculations concerning the net benefit of social media.

Carpooling is a great example, because the relative lack of carpooling today is a clear instance of what economists call “market failure” — a situation in which markets fail efficiently to provide a mutually-beneficial outcome. Think of it this way. There are lots of people in need of a ride. And there are lots of people with rides to offer. The problem is a lack of information (who is going my way, at what time?) and lack of trust (is that guy a potential serial killer?) Social networking promises to resolve both of those problems, first by helping people coordinate and second by using various mechanisms to make sure that everyone participating is more or less trustworthy.

With regard to car-pooling, the obvious benefits are environmental. But the positive effect here is quite general: just about any time we find a way to foster mutually-advantageous market exchanges, we’ve done something unambiguously good. This is one example of the ethical power of social media.

Another big enemy of efficient markets is monopoly power, or more generally any situation in which a buyer or seller is able to exert “market power,” essentially a situation in which some market actor enjoys a relative lack of competition and hence has the ability to throw its weight around. Social media promises improvements here, too. Sites like allow individuals to aggregate in ways that give them substantial bargaining power.

The general lesson here is that markets thrive on information. Indeed, economists’ formal models for efficient markets assume that all participants have full knowledge — that is, they assume that lack of information will never be an issue. Social networks are providing increasingly sophisticated mechanisms for aggregating, sharing, and filtering information, including important information about what consumers want, about what companies have to offer, and so on. So while a lot of attention has been paid to the sense in which social media are “bringing us together,” the real payoff may lie in the way social media render markets more efficient.

Facebook, It’s Not OK to Suck

Facebook users should keep complaining, complaining bitterly, complaining in every possible forum.

Oddly, for all the controversy over Facebook implementing yet another round of changes to its layout and user experience, that controversy has almost been drowned out by arguments over whether it’s appropriate for users to complain about Facebook. Yes, the burning debate among users is over whether there should be a burning debate among users.

Much of the force of the “stop complaining!” camp is rooted in the claim that, hey, after all, it’s a free service and no one’s forcing you to use it anyway. But contrary to what you might have heard, Facebook isn’t optional, and it isn’t free. Let me explain.

First, let’s talk price. Lots of people have already pointed out that while Facebook doesn’t charge users for an account, that doesn’t mean it’s free. The service is supported by advertising, just like TV shows have been since the days of early soap operas. So you are “paying” to use Facebook — you’re paying with your eyeballs. You’re paying with attention, however fleeting, to those ads along the side of the page. And — the more worrying fact — you’re paying with your privacy, as Facebook uses what seems to be increasingly-ornate ways to gather information about you, your preferences, and your web-surfing habits. As the saying goes, there’s no such thing as a free lunch. Facebook isn’t an exception.

Think of it this way: Facebook is like a gas-station bathroom. It might be “free”, but that doesn’t mean that quality doesn’t matter. In both cases, the “free” service being offered is there as an inducement. In the gas station’s case, it’s an inducement to stop there for gas (and increasingly for snacks, magazines, etc.). In Facebook’s case, being able to post stuff for “free” for your friends to see is an inducement to look at those ads, and to share your web-surfing habits with that advertising agency. So they have reason to want you to be satisfied, and you have every right to demand excellence in return for your attention.

Second, is Facebook optional? Whether a product is optional or not matters, ethically, because when a product is truly optional, customers can simply exit the relationship, either buying the product from someone else or not buying it at all. Given the option to exit, the dispute between producer and consumer evaporates as the two simply agree to disagree and go their separate ways. (The classic source on this is Albert O. Hirschman’s book, Exit, Voice, and Loyalty.) But Facebook isn’t optional. Ok, I know. Strictly speaking yes it’s optional. But then, so is email, or having a telephone, or having a car. Optional but, for many of us, functionally essential. In this regard, Facebook is a victim of its own success. It has no real competition, and the service is one that many of us cannot simply walk away from. In essence, Facebook has gained a virtual monopoly on what has become part of our social infrastructure. Complaining about Facebook is no sillier than complaining about the state of your local roads or the consistency of your supply of electricity.

So if you don’t like Facebook’s new layout, or if you don’t like Facebook’s approach to privacy, do not hesitate to complain. You’re well within your rights. And if Facebook listens, you might just help make the on-line world a better place.

Should Twitter Censor?

Last weekend, a despicable “hashtag” trended* on Twitter, one promoting the idea that violence against women is OK. By Sunday morning, tweets using that hashtag were mostly critical ones, expressing outrage at any non-critical use of the hashtag. One prominent twitterer, Peter Daou, (@peterdaou) asked why Twitter wasn’t preventing that hashtag from trending. He tweeted:

“Unbelievable: Is Twitter REALLY allowing #reasonstobeatyourgirlfriend to be a trending topic??!”

The outrage expressed by Daou and others is entirely appropriate. The hashtag in question is utterly contemptible. But the question of whether Twitter should censor it and prevent it from trending is another question altogether.

The central argument in favour of censorship is that the idea being broadcast is an evil one, and decision-makers at Twitter are in a clear position to stifle the spread of that evil idea, or instead to allow its proliferation. With great power comes great responsibility.

The most obvious reason against censorship is freedom of speech, combined with the slippery slope argument: if Twitter is going to start censoring ideas, where will it end? Freedom of speech is an important right, and that right includes the right to speak immoral ideas. Limits should only be imposed with great caution.

Now, it’s worth noting that the hashtag trending isn’t actually anyone’s speech: it’s the aggregate result of thousands of individual decisions to tweet using that hashtag. So if Twitter were, hypothetically, to censor the results of their trending-detection algorithm, they wouldn’t actually be censoring anyone, just preventing the automated publicizing of a statistic. But perhaps that’s a philosophical nicety, one obscuring the basic point that there is danger anytime the powerful act to prevent a message from being heard.

More importantly, perhaps, Twitter isn’t a government, it’s a company, and it doesn’t owe anyone the use of its technology to broadcast stupid ideas (or any other ideas, for that matter). We insist that governments carefully avoid censorship because governments are powerful and because for all intents and purposes we cannot opt out of their services as a whole. If a company doesn’t want to broadcast your idea, it’s not morally required to. Your local paper, for instance, isn’t obligated to publish your Letter to the Editor. The right to free speech isn’t the right to be handed a megaphone.

But then the challenging question arises: is Twitter a tool or a social institution? Just how much like a government is Twitter, in the relevant sense? It is, after all, in control of what many of us regard as a kind of critical infrastructure. This is a challenge faced by many ubiquitous info-tech companies, including Twitter, Facebook and Google. While their services are, in principle, strictly optional — no one is forced to use them — for many of us going without them is very nearly unthinkable. We are not just users of Twitter, but citizens. That perspective doesn’t tell us whether it’s OK for Twitter to engage in censorship, but it does put a different spin on the question.

*The fact that it was “trending” on Twitter means that Twitter’s algorithm had identified it as, roughly, a “novel and popular” topic in recent tweets. Trending topics are featured prominently on Twitter’s main page.

Surfing Porn at Work

As someone once said, ‘let he among you who has a free hand cast the first stone.’

Canadian Business recently reported that the head of Houston’s public transit agency has been suspended (for a week) for using the agency’s internet connection to look at porn.

This sort of conflict is likely to become increasingly common, since the only thing more ubiquitous in office settings than boredom are high-quality internet connections. And I suspect that under-prepared employers are likely to continue overreact, for no particularly good reason.

It seems to me that the point here should not be about porn; the point should be whether personal web-surfing at the office is allowed at all. There’s all kinds of deviant, transgressive, and socially controversial stuff on the web. Porn, per se, is far from the worst. So surfing the web for non-business purposes should either be allowed, or not. Either could well be a reasonable policy. A company can reasonably forbid use of company internet for personal purposes, just as most forbid use of corporate stationary or corporate premises by employees who are moonlighting. On the other hand, a company might reasonably allow a certain amount of personal usage as akin to making the occasional personal call on a company phone. But if employees are not allowed to use company internet for personal (including entertainment) purposes, that should be a clearly-stated policy.

There are of course a couple of circumstances in which an employer would have a legitimate interest in limiting the kind of stuff employees access online. One is size. If the employee is downloading large porn files (say, entire movies), that kind of thing could have an impact on the firm’s bandwidth usage, something that could cost money or just slow down internet access for employees engaged in legitimate work. Of course, the same would go for employees downloading the latest episode of Breaking Bad on iTunes. The second circumstance would be if there is a chance that the download would be visible and reflect badly on the company. If for some reason the fact that you’re surfing porn at work is liable to come to the attention of people outside the company, then, reactions to porn being as variable as they are, you should avoid drawing potentially unwanted attention to your company that way.

But in general, at least, the fact that it’s porn you’re looking at on your break, behind a closed office door, shouldn’t much matter to your employer.

None of this is to say, of course, that surfing porn at work is a good idea. It’s generally pretty dumb, especially if there’s any chance at all that co-workers are going to see and be offended. After all, we’re talking about the office, not your own living room. And so while employers have reason to allow their employees a certain amount of latitude, employees have reason to exercise a certain amount of discretion.

Walmart & Free Shipping: Who Will Suffer?

Once again, Walmart is making headlines with a business practice that will be good for its customers, and bad for its competitors. Here’s the story, by Stephanie Clifford for the NYT: Wal-Mart Says ‘Try This On’: Free Shipping

For years, Wal-Mart has used its clout as the nation’s largest retailer to squeeze competitors with rock-bottom prices in its stores. Now it is trying to throw a holiday knockout punch online.

Starting Thursday, Wal-Mart Stores plans to offer free shipping on its Web site, with no minimum purchase, on almost 60,000 gift items, including many toys and electronics. The offer will run through Dec. 20, when Wal-Mart said it might consider other free-shipping deals….

Not surprisingly, Walmart’s competitors are alarmed. Smaller on-line businesses don’t get the kinds of sweet shipping rates that Walmart gets from UPS and FedEx, and they don’t have the regional distribution centres that allow Walmart to keep its shipping costs low. It’s pretty clear that this move by Walmart is going to put serious pressure — maybe even fatal pressure — on some of its competitors.

Just 2 quick points to make:

1) It’s worth noting (for the benefit of those who don’t know) that Walmart’s profit margins are already razor-thin. Yes, the make big profits overall, but that’s due to their mind-bogglingly huge volume of sales. On a per-sale basis, their profit is very small. So the money for shipping a given product (for free) isn’t coming out of the profits on sales of that product — the profits just aren’t there. Something has to give. One possibility is that it really is a short-term gimmick, perhaps intended precisely to drive competitors out of business. That would potentially count as an instance of predatory pricing, which would be at least arguably unethical and potentially illegal — in spite of the short-term benefits to consumers.

2) Normally when we think about Walmart’s effect on competitors, we think about its effect on its very small competitors, the ‘mom & pop’ operations. But I wonder whether that’s the case here. I’m no expert on the structure of the industry, but it seems that the companies most likely to be hurt are Walmart’s large and mid-sized competitors, i.e., companies that occupy roughly the same strategy space as Walmart. It seems to me (and it’s just a hypothesis) that most small retailers will have significantly different business strategies than Walmart, and hence won’t be competing directly with Walmart in ways that would let them fall victim to this latest maneuver. If I’m right, then if Walmart really can sustain this free shipping policy (and they haven’t claimed they’ll even try to) it would be very bad for its medium-sized and large competitors. If that’s the case, will people have the same kinds objections as they tend to have when Walmart’s consumer-friendly strategies are instead bad for small businesses?

Facebook and Dangerous Ideas

Of all the ideas that a CEO can have, is the most dangerous one the idea that his main objective should be to generate profits for shareholders?

How about a belief in the idea that your privacy — the privacy of millions of customers, whose information he holds in the palm of his hand — just doesn’t matter? That’s roughly what Facebook CEO Mark Zuckerberg seems to believe.

Venture Beat’s Kim-Mai Cutler looked around and found a bunch of evidence about just what Zuckerberg believes, including this gem:

“You have one identity,” he emphasized three times in a single interview with David Kirkpatrick in his book, “The Facebook Effect.” “The days of you having a different image for your work friends or co-workers and for the other people you know are probably coming to an end pretty quickly.” He adds: “Having two identities for yourself is an example of a lack of integrity.”

What Zuckerberg is really talking about when he talks about people having “two identities” is privacy. He means revealing more or different information to some people than you do to others. And far from betraying a deep character flaw (“lack of integrity”), giving differential access to information about ourselves is widely regarded as an important part of how we develop and maintain intimate relationships. Your friends (including Facebook “friends”) are more or less just people who have access to information about you that most people don’t have. What it means to be intimate with someone (sexually or otherwise) is to give them access that you don’t give to everyone. It’s what makes them special. For someone like Zuckerman not to understand this is truly scary, given how much information he controls.

And as usual, my point here is more about the general question than about the particular instance. The point of this blog entry isn’t to add one more voice to the chorus of criticisms levelled against Facebook recently. I’m just using Facebook as an example, to illustrate the point. Many people believe that the belief in the importance of profits is the big, dangerous idea we need to worry about. But it’s not. There is nothing wrong with zealously pursuing profits, so long as you don’t do so through anti-social means.

So here’s a CEO with a truly scary belief, but it’s not the belief in the importance of profits.

No, the real danger doesn’t lie in a commitment to making profits; the danger lies in what you’re willing to do to make those profits.


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