Information System Tutorial - Week 5
Enable commerce using the Internet
I. Practice exercises
1. Find a company that is purely Web based. Next, find the Web site of a company that is a hybrid (i.e., they have a
traditional brick-and-mortar business plus a presence on the Web). What are the pros and cons of dealing with each type
of company?
2. Compare three different search engines. What tips do they provide to improve a page’s rankings? How much does it cost
to advertise a page on their results pages? If you were a company, could you think of any situation where you would pay
almost any amount to have the first listing on the first results page?
3. Have you ever used a mobile, wireless device such as a smart phone? If so, what do you like or dislike about it? In what
ways could your use of that device be made better? If you are not using one, what is preventing you from using one?
What would have to happen before you would begin using such a device?
II. Multiple choice question
1. EC is the online exchange of _______ among firms, between firms and their customers, and between customers,
supported by communication technologies and, in particular, the Internet.
A. goods B. services
C. money D. all of the above
2. __________ are those companies that operate in the traditional, physical markets and do not conduct business
electronically in cyberspace.
A. Brick-and-mortars B. Click-onlys
C. both A and B D. Dot-coms
3. A _______ describes how a firm will earn revenue, generate profits, and produce a superior return on invested capital.
A. profit-and-loss statement B. revenue model
C. business model D. annual report
4. According to the text, the three stages of Web sites include all of the following except _______.
A. e-tailing B. e-integration
C. e-transaction D. e-information
5. The revolutionary aspect of the Priceline.com Web site lies in its _______ system called Name Your Own Price.
Customers specify the product they are looking for and how much they are willing to pay for it.
A. immediate pricing B. menu-driven pricing
C. forward pricing D. reverse pricing
6. _______ is a type of e-auction fraud where bidders are lured to leave a legitimate auction in order to buy the same item at
a lower price.
A. Bid luring B. Product luring
C. Customer luring D. Low-price luring
7. A Web site should _______.
A. be easy to use and fast B. offer something unique and be aesthetically pleasing
C. motivate people to visit, to stay, and to return D. all of the above
8. C2C EC can be categorized according to _______.
A. the number of goods sold B. the number of buyers and sellers
B. the payment methods accepted C. all of the above
9. Trying to “outsmart” a search engine to improve a page’s ranking is known as _______.
A. rank enhancement B. SEO
C. search engine hacking D. Google fooling
10. According to the Internet Tax Freedom Act, e-tailers _______. A. have to collect sales tax from all customers, regardless
of their location
A. have to collect sales tax from all customers, regardless of their location
B. have to collect sales tax based on the place of the customer’s residence
C. have to collect sales tax based on the prevalent tax rate at the e-tailer’s headquarters
D. have to collect sales tax only from customers residing in a state where the business has substantial presence
III. Case study
YouTube
It’s the Web site everyone visits at least once, and most surfers come back again and again. It’s the ubiquitous YouTube.
Where else can you watch a video of a cat swimming contentedly in a bathtub, a 12-yearold rendering a professional
performance of the “The Star Spangled Banner” at a smalltown basketball game, or a public political debate where candidates
answer questions visitors to the site have submitted?
YouTube, a video-sharing Web site, went online in 2005. Two former PayPal employees, Steve Chen and Chad Hurley,
created the site, and it was practically an overnight success. The San Bruno, California–based service uses Adobe Flash
technology to display a wide variety of user-generated video content, including movie and TV clips, music videos, video
blogging, and short original videos. In July 2006, YouTube reported that visitors to the site were viewing more than 100 million
video clips a day—a fact that compelled Google Inc. to buy the site that year for $1.76 billion in stock. As of 2010, YouTube
continues to be a successful video site and a top destination for Web surfers who watch an average of 15 minutes of video
each day. According to the site, hundreds of millions of videos are watched daily, and 20 hours of video are uploaded every
minute. YouTube is free and registration is not necessary for visitors to view videos. To upload videos, however, registration is
required. Videos with pornographic content and those showing nudity or that defame or harass are prohibited, as is advertising
and anything encouraging criminal conduct. All of that video requires YouTube to have access to a lot of bandwidth. The
bandwidth expenses for the service were estimated at $300 million for 2009. That same year, the viewing of videos on
YouTube consumed an amount of bandwidth comparable to the entire Internet in the year 2000. In fact, in 2007 the British
publication the Telegraph expressed fears that the Internet could “grind to a halt within two years” without massive upgrades to
the Internet infrastructure. Fortunately for YouTube fans and Internet users in general, that didn’t happen. Bandwidth issues
aside, YouTube continues to try and draw in more viewers. To that end, the site’s user interface got a major overhaul in the
spring of 2010. The main page was streamlined and redesigned to be more social-media
friendly. In addition, the update made it easier to locate and watch a continuous stream of related video content. As YouTube
has gained in popularity, police forces around the country have used the service to help catch criminals. In April 2010, for
example, homicide investigators in Vancouver, British Columbia, posted a video about a victim in an unsolved but high-profile
murder case. Although the case was being actively investigated, the investigative team had exhausted their list of leads. The
posted video included photos of the woman who had been killed and a recap of what the investigators had pieced together up
to that point. Their hope wasthat by using social media and getting the story in front of viewers, it might help jog a memory of
someone who might have seen something pertinent to the case. Some police departments, however, such as St. George
County, Virginia, said they would not use YouTube for catching criminals because posting police videos next to those with
“crazy” content would be “bad publicity” for the police.
Regardless of the propensity for catching criminals or lack thereof, YouTube has had its share of legal issues as well. After
several lawsuits were filed alleging copyright violations over copyrighted material posted on YouTube, the company agreed to
remove copyrighted material on request. In addition, YouTube installed software intended to automatically detect and remove
copyrighted clips. In order to function correctly, however, the software needed to compare clips of copyrighted material to
YouTube content, which meant that music, movie, and television companies would have to send decades of clips of
copyrighted material to YouTube so that comparisons could be made.
In March 2010, the entertainment corporation Viacom entered into a $1 billion lawsuit against YouTube alleging that the video
site knowingly made a financial gain from 62,637 Viacom video clips that were viewed over 507 million times. YouTube has
countered by alleging that Viacom was covertly uploading clips of their content in an attempt to sabotage YouTube’s efforts to
remove copyrighted material. Although it remains to be seen how the lawsuit will be resolved, it is a sticky situation for the
video site. Whatever YouTube’s future, it’s not likely that Internet users will soon lose interest in video sharing.
Questions
1. Do you use YouTube? If so, what is your favorite type of content? If not, why not?
2. How can businesses use YouTube to promote a good brand image? Have you seen any “good” campaigns on YouTube? If
so, what made them appealing?
3. What potential dangers for a business’ reputation can arise from user-generated content posted on sites such as YouTube?
How can a business react to such dangers?
