USA: +1(669)289-8683 
Sign in
IMED 2409 – Chapter 7 – The Environment of Electronic Commerce: Legal, Ethical and Tax Issues
Assignment: Complete Exercise E1 (200 WORDS) & E2 (200 WORDS)
Complete Case Problem C1. Nissan.com, parts 1 (200 words) & 2 (200 words)
Answer Exercise 1
Use your favorite Web search engine to obtain a list of Web pages that include the words “privacy statement.” Visit the Web pages on the search results list until you find a page that includes the text of a privacy statement. Print the page and turn it in with a report of about 200 words in which you answer the following questions:
a. Does the site follow an opt-in or opt-out policy (or is the policy not stated clearly in the privacy statement)?
b. Does the privacy statement include a specific provision or provisions regarding the collection of information from children?
c. Does the privacy statement describe what happens to the collected personal information if the company goes out of business or is sold to another company (list these provisions, if any)?
Close your report with one paragraph in which you evaluate the overall clarity of the privacy statement.
Answer Exercise 2
Companies that do business online can find themselves in legal trouble if they commit a crime, breach a contract, or engage in a tortious action. In about 200 words, provide an online business example of each offense. As part of your answer, explain why you believe each action you describe is either a crime, a breach of contract, or a tort.
Answer Case 1. Nissan.com
The Nissan Motor Company of Japan had sold its cars in the United States under the brand name Datsun for many years. In the late 1980s, the company changed its branding policy and began selling cars in the U.S. market with the name of Nissan. However, the company did not realize that the Web would become an important marketing tool and did not register the name nissan.com as soon as it became available.
Nissan was not the only auto company to miss an opportunity to register its brand’s domain name early. General Motors had registered the domain gm.com in 1992, but it had not registered generalmotors.com. The company had to purchase that name from Gil Vanorder, who had registered it in 1997. Vanorder’s site featured a cigar-smoking, uniform-wearing cartoon character named “General John C. Motors.” Volkswagen (which had registered vw.com when it first became available) successfully sued Virtual Works (an ISP) to obtain the domain name vw.net. Other auto companies have purchased or sued (with mixed results) to obtain domain names that included their product brand names. DaimlerChrysler was able to purchase dodge.com in 2001 from the London financial software company that had registered it originally. Ford had to sue National A-1 Advertising to obtain the right to use lincoln.com. However, Ford was unsuccessful in its attempts to obtain mercury.com. That name was owned by the New York City information technology services company, Mercury Technologies, which is now owned by Hewlett-Packard.
In 1991, Uzi Nissan formed a company named Nissan Computer Corp. in North Carolina to sell computer hardware and provide related repair and consulting services. Nissan’s company also offered networking hardware for sale, along with related services. In 1994, the company registered the name nissan.com. In 1996, the company registered the domain name nissan.net and began offering ISP services to individuals and companies at that Web site.
In 1995, he received a letter from a lawyer representing Nissan Motor Co. The letter requested information about how Nissan was planning to use the domain name nissan.com. Because he was operating a computer company and Nissan Motor Co. was an auto company, Nissan decided there would be no potential confusion in customers’ minds about the relationship (or lack thereof) between Nissan Computer and Nissan Motor Co. Nissan did not respond to the letter. The lawyer did not follow up with any other contact, so Nissan considered the issue closed.
In 2000, Nissan Motor Co. sued Nissan Computer under the U.S. Anticybersquatting Consumer Protection Act for $10 million and the exclusive right to use the names nissan.com and nissan.net. Uzi Nissan argued in court that he was just using his family name (which is a common name in the Middle East) to which he had a basic right, that he had no intent to profit from the name (he was unwilling to sell it to Nissan Motor Co. at any price), and that there was little likelihood that his computer store would be confused in the minds of the consumers with the international auto company of the same name. Nissan Motor Co. argued that its brand name was so well known that any alternative use of the name would be confusing to consumers.
In 2002, opinions issued by the California Superior Court and the U.S. Ninth Circuit District Court held that Nissan Computer had not acted in bad faith when it acquired the disputed domain names. However, the court ruled that Nissan Computer could no longer use the domain names for commercial purposes because of the potential confusion it could create in the minds of consumers. Nissan Computer would have to find a different domain name for its business. The court also ordered that Nissan could not place any advertising on his Web sites at nissan.com or nissan.net and prohibited him from placing disparaging remarks or negative commentary about Nissan Motor Co. (or links to such remarks or commentary) on the two sites. The court did not, however, order the transfer of the two domain names to Nissan Motor Co. The Web Links for this chapter includes links to the Web sites operated today by Nissan Computer and Nissan Motor Co. In 2005, the U.S. Supreme Court refused to hear Nissan Motor Co.’s appeal of the lower court rulings, which allows them to stand.
Required:
1. U.S. courts sometimes appoint advisors (often called Special Masters) to help them decide cases that involve complex business or technical issues. Assume you are a business advisor to a court that is hearing an appeal of the Nissan Motor Co. v. Nissan Computer Corp. case. In about 200 words, explain why Nissan Motor Co. is so concerned about the use of these two domain names and how a monetary damages judgement of $10 million could be justified (if you do not believe that the monetary damages are justified, explain why).
2. In about 200 words, provide an outline of the ethics of the position taken by Uzi Nissan in this dispute.
IMED 2409 – Chapter 8 – Web Server Hardware & Software
Assignment:
Complete Exercise E3 (300 WORDS)
Complete Case Problem C2. Random Walk Shoes, parts 2 (100 words min) & 3 (100 words min)
Exercise 3
Assume you are planning Web server computer capacity for a business that has 5000 business customers and sells about 1200 different products. Each customer buys between 10 and 50 items two or three times each month. The business had 300 employees, 200 of whom regularly interact with the company’s online sales system. As you learn more about disk storage options for the Web server, you learn that many companies selling Web servers offer a configuration option for controlling those computers’ disk drives called “RAID”. Using the Web and your library, investigate the purpose of RAID controllers. Learn what these controllers do and how they do it. Form an opinion regarding the suitability of these controllers in the Web server you are planning. Summarize your findings in a 300-word briefing report suitable for presentation to a nontechnical manager.
Case 2. Random Walk Shoes
Amy Lawrence, the owner of Random Walk Shoes, has asked you to help her as she launches her company’s first Web site. In college, Amy was a business major with an artistic bent. She helped to pay her way through college by decorating sneakers with her hand-painted designs. Her business grew through word of mouth and through her participation in crafts fairs. By the time she earned her degree, Amy was running a successful business from her dorm room.
Amy expanded her sales efforts to include crafts fairs in nearby towns. She hired two college students to work for her, and she convinced several area gift shops to stock samples of her merchandise. The gift shops were not an ideal retail outlet for her products, however. Most people who want to buy decorated sneakers want to choose specific designs or have special designs created just for them. Customers also want to choose the specific shoes on which the design is placed. One of Amy’s student workers suggested that she consider selling her products on the Web.
Realizing that the Web would give Random Walk Shoes a chance to reach a much wide audience and would allow customers to choose design–shoe combinations, Amy began gathering information and developing estimates about her planned Web activity. She bought a digital camera and took several hundred pictures of shoes, designs, and shoe–design combinations. She then hired a local Web designer to create sample pages for the Web site, including catalog pages that contained the digital images.
When the Web designer had completed a prototype of the site, Amy worked with the designer to calculate page sizes (including the images). The average page size was 100 KB. Amy and her employees then navigated the prototype site several hundred times to develop an estimate of how many pages an average visitor would download. They concluded that an average site visitor would visit 23 pages during each visit. Amy worked with the Web designer to develop estimates of the activity they expect to occur on the Web site during its first two years of operation. These estimates include:
• The database of Web page information (including the images) will require about 400 MB of disk space.
• The database management software itself will require about 200 MB of disk space.
• The shopping cart software will require about 200 MB of disk space.
• About 8000 customers will visit the site during the first month, and site traffic will grow about 20 percent each month during the first two years.
• The site should accommodate a peak traffic load of 3000 visitors at one time.
Amy wants to include features on the site that are similar to those found on competing sites (a list of links to businesses that sell customized shoes on the Web is included in the Online Companion for your reference). Amy wants the site to provide a good experience for visitors. If the site is successful, it will generate sufficient revenue to allow an upgrade after two years. However, she does not want to spend more money than is necessary to get the site up and keep it running for the next two years.
Required:
2. Consider the advantages and disadvantages of each major operating system that Amy might use on the new Web server computer. In a one-page memorandum to Amy, make a specific recommendation and support it with facts and a logical argument. If you do not believe that one operating system is clearly superior for this application, explain why.
3. Consider the advantages and disadvantages of each major Web server software package for accomplishing the goals that Amy has for this site. In a one-page memorandum to Amy, make a specific recommendation regarding which Web server software package she should use. Provide an explanation that supports your recommendation.
IMED 2409 – Chapter 9 – Electronic Commerce Software
Assignment:
· Complete Exercise E2 (400 WORDS)
· Complete Case Problem C1. Ingersoll-Rand Club Car Division, parts 2 (200 WORDS) & 3 (100 WORDS)
Answer Exercise 2
Annette Jackson owns a small crafts store in central Missouri. She wants to expand her store’s reach outside the region to increase her profits and simultaneously reduce her inventory. Annette’s teenage daughter suggested that she consider selling online to expand her total sales. She asked you to help her estimate how much it might cost in the first year to create a simple store with a catalog of about 100 items. Annette wants you to investigate two CSP offerings and report back to her what you find. Because her store is small, limit your research to basic commerce and mall-style services. Annette would like to consider the following information for the two CSP offerings you examine:
• Costs: initial setup fee, monthly fee, and transaction fees
• Amount of disk space the CSP would provide for Annette’s 100-item store
• Promotion and marketing opportunities
• Customer communications capabilities, such as automated e-mail confirmation of orders
• Shopping cart or other order entry mechanism
• Storefront-building wizards for creating a new store
• Upload capabilities for product names, descriptions, images, and costs (can they be uploaded from files or databases, or must the merchant enter each item individually?)
• Existence of an online user manual for the merchant
Use your favorite search engine to find CSPs that might meet Annette’s needs. Produce a report of about 400 words summarizing your findings.
Answer Case 1. Ingersoll-Rand Club Car Division
Ingersoll-Rand is a $9 billion diversified manufacturing company that sells its products worldwide. Its well-known brands include Ingersoll-Rand tools and portable power generators, Bobcat construction equipment, Thermo King refrigerated transport systems, Dexter and Schlage locks, and ARO industrial fluids equipment. The company’s Club Car division manufactures and sells a variety of small electric cart vehicles to golf courses and industrial users. The division also sells a rough-terrain version designed for farmers, ranchers, construction workers, and recreational users.
In 2001, the Club Car division was experiencing a sales decline. The downturn in the general economy was affecting golf courses, which, in turn, were reducing the size and frequency of their golf cart orders. Club Car had a general sense that this major market segment was causing their revenues to decline, but their information systems were not providing enough data about exactly which sales were being most affected by the economic downturn.
Club Car sales managers relied on their sales representatives for information about likely future sales. Sales forecasting was a matter of judgment, guesswork, and a few spreadsheet software models scattered throughout the regional sales offices. The sales representatives had little influence on how the carts were customized for particular customer segments or for individual customers.
The company decided it needed better information about all of its sales and marketing activities, so it spent more than $2 million to install a comprehensive CRM system. This system was designed to automate the entire customer sales cycle: prospect evaluation, proposal writing, product configuration, and order entry. However, the users at Club Car division found the new system difficult to use and therefore were reluctant to spend much time learning how to use it. Thus, the promised benefits of improved productivity and more detailed reports were not forthcoming. Sales managers did not see the ultimate benefits that the system might provide. Salespeople found that the new system was requiring them to spend time entering data into the system rather than seeing customers. The order entry staff found the system to be cumbersome and unfamiliar.
When Club Car’s president realized that the CRM system was not delivering on its promise, he had the management team go back and re-examine the key elements in the division’s customer relationships and asked them to choose one or two issues that needed attention. The management team identified two major issues. First, the order entry process required the time of salespeople and order entry staff, but it did not include any interaction with customers. Second, the division was not producing accurate and timely sales forecasts.
In 2002, Club Car division re-launched its CRM efforts and focused on these two problem areas. The new effort included the sales representatives in redesigning the order entry process. The division was able to reduce the data entry time and effort required, especially the time of salespeople. Salespeople do have remote access to the system, so they can work on-site with customers to configure the carts to the customers’ exact specifications. Salespeople can obtain pricing information and explore various alternatives with customers while they are at the customer’s site. They can also examine manufacturing schedules and provide more accurate delivery date estimates. All of this remote, real-time information access helps salespeople close deals and increase sales volume and profitability.
Sales forecasts are more accurate now because the information about sales orders is automatically collected when the sales representatives close sales at the customers’ sites. The CRM system combines this real-time sales order information with general industry information on cart demand, cart replacement cycles, and economic trends in their customers’ industries. The increased accuracy of sales forecasts allows the company to create more stable production schedules, which means that more customers receive their carts on the delivery date they were promised.
Required:
2. In the CRM re-launch, Club Car division focused on two CRM elements. In about 200 words, explain why this approach would work better, in general, than implementing a comprehensive CRM system that could track all of the division’s sales activities and related information in real time.
3. In about 100 words, describe the benefits Club Car division might obtain by using cloud-based CRM software.
IMED 2409 – Chapter 10 – Electronic Commerce Security
Assignment:
· Complete Exercise E3 (200 WORDS)
· Complete Case Problem C1. Bibliofind, Parts 1 (300 WORDS) & 3 (300 WORDS)
Answer Exercise 3
Third-party assurance providers such as BBBOnline, Inc., and Truste sell their services to businesses that want to encourage Web site visitors to trust them with their personal information. Review the Web site of one or more of these third-party assurance providers and identify the security features the provider considers important in Web sites that it approves. Select two of the security features you identify and write a 200-word explanation of why the assurance provider considers these features to be important elements for preserving the privacy of site visitor information.
Answer Case 1. Bibliofind
Bibliofind was one of the first Web sites to specialize in hard-to-find and collectible books. The site featured a powerful search engine for used and rare books. The search engine’s database was populated with the results of Bibliofind’s daily surveys of a worldwide network of suppliers. Registered site visitors could specify the title for which they were searching, a price range, and whether they were seeking a first edition. The site also allowed visitors to build a wish list that would trigger an e-mail when a specific book on the list became available.
Bibliofind had developed a large customer list, an excellent reputation, and a solid network of rare book dealers, all of which made the company an attractive acquisition for other online bookstores. In 1999, Amazon.com bought Bibliofind, but Bibliofind continued to operate its own Web site and conduct its business as it had before the acquisition.
Several years after the Amazon.com acquisition, Bibliofind’s Web site was hacked. The cracker had gained access to the company’s Web server and replaced the company’s Web pages with defaced versions. Bibliofind shut down its Web site for several days and undertook a complete review of its Web site’s security. When the company’s IT staff examined the server logs carefully, they found that the Web page hacking was only the tip of the iceberg. Entries in the logs showed that attackers had been accessing Bibliofind’s computers for more than four months. Even worse, some of the crackers had been able to go through the Web servers to gain access to the computers that held Bibliofind customer information, including names, addresses, and credit card numbers. That information had been stored in plain text files on Bibliofind’s transaction servers.
Bibliofind called in state and federal law enforcement officials to investigate the hacking incidents and sent an e-mail notification to the 98,000 customers whose private information might have been obtained by the crackers. The investigation did not result in any arrests, nor did it determine the identity of the intruders. Many of Bibliofind’s customers were very upset when they learned what had happened.
A month after the hacking incident, Amazon.com moved Bibliofind into its zShops online mall (zShops was the original name of Amazon Marketplace). As an Amazon zShop, Bibliofind could process its transactions through Amazon’s system and no longer needed to maintain private information about its customers on its computers; however, the company had seen its reputation seriously damaged and eventually was closed down. A successful business was ended in large part because had it failed to maintain adequate security over the customer information it had gathered.
Required:
1. In about 300 words, explain how Bibliofind might have used firewalls to prevent the intruders from gaining access to its transaction servers. Be specific about where the firewalls should have been placed in the network and what kinds of rules they should have used to filter network traffic at each point.
3. California has a law that requires companies to inform customers whose private information might have been exposed during a security breach like the one that Bibliofind experienced. Before California enacted this law, businesses argued that the law would encourage nuisance lawsuits. In about 300 words, present arguments for and against this type of legislation.
IMED 2409 – Chapter 11 – PAYMENT SYSTEMS FOR ELECTRONIC COMMERCE
Assignment:
· Complete Exercise E3 (300 WORDS)
· Complete Case Problem C1. First Internet Bank of Indiana, Parts 1 & 3 (500 WORDS)
Exercise 3
Evan Moskowitz has formed an Internet training company called Teach-U-Comp to sell computer programming courses online. Each course costs $65, and students receive continuing education units (CEUs) based on the duration of the course and its level of difficulty. Evan expects to sell about 100 courses each month during his first few years in operation. He would like to accept credit cards as payment for the courses. Evan is busy creating the online content and installing the course delivery software, so he hired you to investigate payment processing options for the site. Use your favorite search engine to identify three companies that process credit card payments for Web sites that sell downloadable digital products (such as Evan’s courses). Examine the processing services offered and fees charged by these three companies and choose one that you believe would be best for Teach-U-Comp. Write a 300-word report in which you summarize your findings. In the conclusion to your report, clearly state which company you would recommend to Evan and explain why.
Case 1. First Internet Bank of Indiana
During the first wave of electronic commerce, many established banks opened online branches and a considerable number of new, completely online, banks were formed. Many of these online banking initiatives were closed, sold, or merged into other operations after the first wave of electronic commerce had subsided. By 2001, many notable names that had dominated the first wave were gone. For example, Bank One had closed its online subsidiary Wingspan Bank and merged its operations into its existing retail banking department. Royal Bank of Canada had done the same thing with its Security First Network Bank (generally believed to have been the first online bank). CompuBank and G&L Internet Bank were both sold to other banks, and USABancshares.com was closed in a flurry of fraud accusations and regulatory concerns.
Many early online-only banks faced similar challenges. They often bought loans instead of originating them. Purchased loans yield lower interest income because the originating bank always charges a fee or discount. They also tended to pay higher rates on customer deposits to attract new customers. These routes to rapid growth can significantly reduce profitability. Physical banks with many branches gain customers and market share because people walk or drive by a branch office and see the bank’s name. New online-only banks must spend substantial sums on advertising that helps establish them as viable brands in a highly competitive market. And many well-established banks now operate online, offering customers a known brand name and the convenience of physical branches along with online banking services. Small businesses were reluctant to deal with online-only banks in the early years of their existence. Small businesses generate considerable profits for banks because they tend to borrow money at relatively high interest rates and also tend to keep large balances in their checking accounts. Thus, there were a number of challenges that made survival difficult for online-only banks.
In 2004, the U.S. Federal Deposit Insurance Corporation (FDIC) issued a report on “limited-purpose banks” (which included online-only banks) in its Future of Banking Study series. The FDIC report concluded that the economics of operating an online-only bank were not attractive and that very few such banks could ever expect to be successful in the long term. Despite the FDIC’s gloomy outlook, a number of banks operate only online. One of those banks is the First Internet Bank of Indiana (often called First IB).
First IB was launched in early 1999. By 2001, the bank had become profitable and had more than $200 million in assets. By 2008, its assets had grown to nearly $600 million. Compared to the large international banks that dominate the financial world, $600 million is a relatively small amount (for example, the Bank of America has more than $500 billion in assets), but First IB was able to operate efficiently and with low costs because it had no physical branch offices and very few employees compared to traditional banks.
First IB invested its resources in building the best Web site it could design and then followed a process of continually adjusting the site’s design and the services offered to respond to customer comments and requests. For example, First IB created a frequently asked questions (FAQ) feature that reduced customer inquiries dramatically. It was also one of the first banks to offer statements and check images online. In 2004, the bank began to make check images available online the day after the check cleared (the industry average delay at that time was four to seven days). The bank has consistently received excellent reviews of its services by online business rating agencies and in the press.
Required:
1. Create a list of 10 specific concerns that a consumer might have when considering an online-only bank. Write a paragraph for each concern that describes how First IB addresses or fails to address it.
4. Assume you are a security consultant hired by First IB. The president of the bank has become concerned about the potential damage that a phishing expedition directed at First IB customers could do to the bank’s reputation. In about 500 words, analyze the phishing threat that faces First IB and outline steps that First IB should take to counter the threat.
IMED 2409 – Chapter 12 – PAYMENT SYSTEMS FOR ELECTRONIC COMMERCE
Assignment:
Complete Exercises E4, parts a & b (200 WORDS)
Complete Case Problems C2. Davis Humanics, parts 1 & 2 (500 WORDS)
Exercise 3.
As manager of networks and computing operations for Fashion Land, a retailer of women’s clothing and accessories, you have seen the business grow from seven stores in Kansas City to over 100 stores located throughout the Midwest. Fashion Land’s marketing research team realizes that the majority of its target customer group— females between the ages of 15 and 35— are regular users of the Web. The researchers have asked you for help in developing an electronic commerce initiative for Fashion Land. Alone, or in a team assigned by your instructor, do the following:
1. Outline a business strategy for Fashion Land’s electronic commerce initiative. The outline should include a list of specific objectives and the costs and benefits of accomplishing each objective. The outline should also include recommendations regarding what to outsource and what staff should be hired.
2. Prepare a memo that lists and briefly describes the major hardware, software, security, payment processing, advertising, international, legal, and ethics issues that might arise in the development of this electronic commerce site.
Answer C2 Davis Humanics
Davis Humanics (DH) is a company founded in 1982 that provides human resources services to about 7000 companies with a total of nearly 100,000 employees. These services include payroll processing, tax filing, health insurance and claims management, and retirement plan management. DH has annual sales of $2 billion and about 1000 employees. DH has grown rapidly and has clients of all sizes, ranging from smaller companies with fewer than 50 employees to Fortune 500 companies.
As DH grows, it is having trouble maintaining a consistent quality of service. Account managers each must handle more clients, and it is becoming difficult for those account managers to maintain a high degree of personal contact with the human resources executives who control DH’s contracts. In the past, account managers worked with a small set of client contact people, but now account managers must work with more people, many of whom they have never met. In addition to account managers, client personnel have regular contacts with DH operations staff (who handle input tasks), DH systems staff (who help customize the interfaces between DH systems and client systems), and DH professional staff (lawyers, actuaries, and human resources professionals who consult with DH clients and their legal counsel regarding the operation of their retirement and benefits plans).
Because DH’s clients are so different in size and how they operate, DH has to be flexible in handling input data. For example, DH’s payroll processing service allows clients many different ways to send in time card data. The largest clients arrange for customized computer-to-computer transfer of information. Some large clients use EDI transfers. Most medium and smaller-sized clients e-mail or fax the time card information, but a significant number mail paper lists that DH must scan into its systems. The health insurance claims handling operation is even more troublesome. In addition to having clients send information in various formats, the insurance companies demand that information be submitted in specific formats, each of which is different.
The complexity of DH’s operations is growing as rapidly as the company adds new clients. Sandi Higbee, DH’s director of Operations, asks for your help in outlining a Web-based customer relationship management (CRM) system that will help manage the account managers’ ever-increasing levels of customer contact. Sandi reviewed the products offered by several leading CRM vendors and believes that one might work as a base product, but no matter which product is chosen, she believes that substantial customization will be necessary because DH’s operations are so complex and different from most companies that sell products or simple services to customers. A good CRM system for DH would need to monitor all types of customer interactions with DH account managers, operations staff, systems staff, and professional staff. In addition, the system’s Web interface would allow DH clients to access parts of the CRM system so they could track DH’s follow-up on their work requests and pending inquiries.
DH evaluates all capital projects, including IT projects, using ROI. Sandi is worried about this because she believes that many of the benefits of this CRM project will be hard to quantify. On the other hand, the costs of the CRM project (software and hardware purchase and cost of consultants who will customize the CRM software to meet DH’s specific needs) will be very easy to quantify and will be large. Sandi expects the vendor-consultant teams to submit bids of between $1 million and $2 million for this project.
Required:
1. Prepare an outline of the benefits that DH expect to obtain from this CRM project. Use categories to organize your list of benefits; for example, you might identify benefits that will accrue to DH’s account managers, operations staff, IT staff, and professional staff. Since DH’s clients will also benefit, you might be able to identify benefits that will accrue to DH’s marketing and sales departments or to DH’s new product development department. Be sure to include any long-term benefits that you think might occur after the CRM system has been in place for several years.
2. Estimate the dollar value of each benefit you identified in the first part of your answer.
3. Prepare a one-page memorandum to the DH Board of Directors in which you argue against using ROI as the primary method for evaluating this project. Keep in mind that these directors have very little time to review your arguments and are very much inclined to use ROI for all project evaluation.
