Dented Reality Notes

Definition: Patent

A patent is a legal document granting the sole rights of an invention to its inventor. Once patented, the inventor controls the use, distribution, duplication and sale of their invention.

Patents are a point of hot content on the Internet, where companies have patented things such as double-clicking with a mouse and the use of cookies to store personal information; technologies which are crucial to much of the operation of computers and online transactions.

Definition: Copyright

Copyright refers to the legal right to reproduce, musical, dramatic, artistic and other literary works. Copyright is normally attributed to the author/composer/creator of the original work, however it can also be sold, transferred or passed on to another party, particularly an agent of some kind.

Copyright infringement carries heavy legal penalties, and is currently very active within the field of illegal music trade.

Biting the Hand That Feeds

On July 26, 2004, something nobody thought could possibly happen; happened. Google went down. Or so it seemed to those who were confronted with the lackluster "Service error -27" message displayed on Google's website early July 26 (US time).

Reports started flying across the country and across the globe by 15:30 GMT, when web users around the world started noticing that their searches were returning an error message instead of the expected results from Google, with Yahoo, AltaVista and Lycos also affected by a similar problem. Throughout the day, it was revealed that rather than being hacked or having other internal problems, the search engines were all being attacked by a new strain of the MyDoom worm, automatically using the search engines to locate new targets.

Experts say that the new version of MyDoom, propagating via email, was different to previous versions, "because it uses the search engines to verify and locate additional e-mail domains to infect" (Taylor, quoted in eWeek). This process of repeatedly accessing the search engines to locate new email addresses is what is believed to have caused the availability problems being reported across the world. An alert email sent to the MessageLabs email security list at 21:13 GMT provided more details as to the operation and background of the worm, explaining in detail how it locates domain names on infected machines and then searches the Internet for more variants of that domain.

The attack came at the worst possible time for Google, hitting them on the same day as they released the highly-anticipated financial details of their pending IPO. After announcing that they were expecting to float for up to $3.8 billion, Google was then struck down in the widest-ranging problem it has had in recent times. Despite the timing, temporary outages don't appear to have affected the generally-positive market-sentiment towards the Google IPO. Existing skeptics do not appear to have picked up the attack as a major issue, although they continue to suggest that Google's growth is in doubt, their opening price is too high and that instant millionaire-employees will lead to increased staff turn-over in the near future.

Meanwhile, security experts were busy warning that a second phase of the worm's infection was beginning to emerge. "The new attack uses MyDoom-infected systems to launch a denial-of-service attack against Microsoft's Web site, says Ken Dunham, director of malicious code at security firm iDefense [sic] Inc." The attack is launched through a companion program called "Zindos" which resides on previously-infected computers and "starts bombarding Microsoft.com with requests"

Interestingly, publicity surrounding these events appeared to focus more on the fact that major search engines were being attacked than the worm itself or its methods of propagation. This change in approach sparks questions about the future approaches of viruses, the vulnerability of search engines and the continued problem of email-borne viruses in general.

Clicking All The Way to the Bank

One of the most popular forms of online advertising is in jeopardy of becoming so plagued with fraud as to make it useless to most companies. Advertising a website through targeted listings against specific keywords in a search engine is not a new process, and neither is the fraud which eats up to 20% of the clicks paid for by advertisers. Under this model, advertisers pay a fee to the search engine every time someone clicks on their advertisement, which normally appears alongside or above related search results. This fee may range from only a few cents, up to several dollars for certain market verticals.

Click fraud refers to 'fake' clicks on these paid listings, each of which costs the advertiser a small amount. This fraud takes place in a number of ways, the most common of which is to target the listings of competitors and click their advertisements, costing them money. Competitors are said to be paying for either groups of people, or automated software robots (bots) to repeatedly click on the listings, costing the advertiser larger and larger amounts. All of the major search engines which accept paid listings say that they are aware of the issue, take it very seriously, and are aggressively pursuing it, but also concede that it still occurs. A recent article in The Times of India even outlined an entire industry in India, based around employing housewives, college students and some business people who get paid to click on online advertisements.

With the ability for services such as FindWhat results and Google AdSense advertisements to be included directly on other websites, another form of fraud has developed. In this system, website owners are paid a portion of the value of a click which originates from their website. Obviously there is an incentive for the website owner to generate more clicks through the advertisements on their website, which leads some of them to act fraudulently to inflate the figures, and their pay-check.

The first publicized case of click fraud was recorded in 2001, by Jessie Stricchiola, President of Alchemist Media, LLC, a company which specializes in search engine marketing, pay-per-click positioning and search engine optimization. 3 years later, the advertiser-paid search results business is worth around $3 billion dollars, and the problem of click fraud is only getting bigger. Google has even acknowledged that click fraud and other fraudulent behavior are a significant risk to their continued operation and profitability in their SEC filing, leading up to their initial public offering. "If we are unable to stop this fraudulent activity, these refunds may increase," Google said. "If we find new evidence of past fraudulent clicks we may have to issue refunds retroactively of amounts previously paid to our Google Network members." (as quoted in WebProNews)

Although only directly affecting paid listings such as those in the Google AdWords/AdSense programs and Yahoo's Overture service, the impact of click fraud may become a major issue for everyone. With most search engines deriving their primary income from paid listings, if click fraud turns advertisers off, search engines may soon find themselves without the revenue required to support the expensive business of indexing the Web and handling millions of searches a day.

Dense Approaches to SEO

Alongside Google's PageRank, keyword density is one of the most touted and important metrics involved in Search Engine Optimization (SEO) and Search Engine Marketing. Christopher Herg of TheSiteWizard calls it "[o]ne of the simplest ways to improve your site's placement in the search engine results". Keyword density refers to the number of times a specific keyword appears on a webpage in relation to other words. Search Engine Marketers believe that a higher keyword density for carefully-selected keywords will result in a web page being listed in a higher position for those keywords. This belief leads to the act of 'keyword spamming' whereby a webmaster places a keyword on a page more often than would otherwise be necessary. Some webmasters go as far as to create entire pages which are nothing but a collection of keywords (doorway pages), in an attempt to draw the attention of search engine spiders. Google consider this problem so important, that they specifically noted it as a "Risk Factor" in their SEC filing as part of the lead-up to their imminent initial public offering (IPO) and listing on the NASDAQ

Wikipedia contains an extensive entry on keyword spamming (spamdexing) which includes details of some of the approaches taken by webmasters to affect their keyword density (hidden or invisible text, meta tag stuffing, hidden links etc) and discusses some related problems and implications of the practice. WebProNews.com even includes "[h]idden text and keywords" under a list of "[o]bjectives to avoid" when "optimizing your website for search engines." Keyword spamming is hardly a new problem for search engines, and yet it continues to be an issue when presenting fairly-weighted results for a user's search.

Consider for a moment that you are a search engine spider; a piece of software which is sent out to scour the Web for new content and report back to your search engine on what you find, and how it should be ranked against certain keywords. Without reading and understanding the content of a page, how would you be able to tell that it shouldn't have a certain keyword listed as many times as it does? Assuming you determined that there were 'too many occurrences' of a keyword, what would the punishment be? What if it was a simple case of the writing style of the author calling for the use of a word a number of times? Without being able to somehow determine that a page has used a keyword 'too many times', a search engine is likely to assume that the page is very heavily related to that term, and thus rank it well for searches containing that keyword.

Evolving search ranking algorithms are getting better at detecting and punishing keyword spamming, but there is always going to have to be an acceptable level of keyword density, and no doubt people will figure out what it is. Webmasters eager for traffic will make sure that their pages are right on the line to avoid punishment while maximizing benefit. This is one of the problems which may just be part of the search engine scene whether we like it or not.

Farming For A Better Listing

You've probably seen them before: mysterious "Links" pages or small text links at the bottom or side of a page with curious collections of words used to link to another website. You may have wondered at the time what purpose they really served, or you may not have given them another thought, after all, they're not part of what you were looking for, so why pay them any attention? If you were a search engine spider however, the piece of software which 'crawls' the web on behalf of search engines, reading web pages and indexing their content, you wouldn't realize that those links were any different from other links on the page. You would follow them, reporting back to your search engine that they were just as important as every other link on the page.

This is what some search engine spammers and 'link exchangers' or 'reciprocal linkers' rely on to promote their websites within search engines. You see, part of the ranking algorithm which decides where a website comes up in a Google (and possibly other search engines) results page relies on the links between websites to determine which sites are more important or relevant to particular keywords. To do this, links coming in to a page are analyzed and weighted based on where they come from and what text the link contained. If, for example, a website had multiple incoming links using the words "online corporate training", then that site's ranking for those keywords would likely be increased. If the sites providing the links were ranked highly in a related field (say "business training"), then the ranking of the first site might be affected even more.

Companies now offer link-exchanging networks, where sites that are willing to provide a link on their site to another trade that service for a link back from them. In this way, both sites benefit from the value of links from other websites. There are even software programs which allow you to search for competitors and the people linking to them, to manage the process of acquiring links (via email) from other websites, and handle the creation of a page dedicated to linking to other sites from your website.

Another form of link-farming which is a little more public, and lacks the financial motives, is blatantly called "Google-bombing". A Google-bomb is when a group of websites work together to artificially place a website in Google under a specific search term. Although this technique has relatively harmless motives (more of a joke than a business strategy), it is one and the same technique as is used by commercial operators to get themselves listed in a good position against a search term which their customers might use.

Search engines will continue to combat efforts like this to affect their listings, and search engine spammers will no doubt continue to come up with new and more effective ways of getting to the top of the results. Unfortunately the open nature of the web and the sheer volume of information available means that search engines will always be subject to some form of abuse unless they allow only selected sites to be displayed. With Google indexing 4,285,199,774 pages at last count, that's a tall order.

Topic 2.3 Notes

This section provided a number of interesting readings looking both at business ethics and morality, and virtual corporations. I have looked at Virtual Corporations in the glossary section for this unit, so I will talk more about ethical business operations, the nature of ethical business, morals in business and whether we should indeed expect corporations to act ethically.

Grace and Cohen attempted to provide at least a framework of a definition for ethics, which proves to be a very grey and subjective area, despite its apparent universality. They provide the following general guidelines for ethics:

Moral opinions should be impartial, and take into account their effects on others, rather than focussing entirely upon one's self.
Ethical opinions should be defendable through reasoning. They cannot be based on emotions or biases.
Moral opinions guide ones actions through evaluation and decision, based upon foresight as to the consequences of a certain path of action.

I thought that Goodpaster and Matthews provided the more interesting discussion of business ethics and the different views and approaches to the issue in regards to business, while the pieces from Grace/Cohen and What is a Corporation from Boylan (Ed.) provided a good background and further, grounded discussion. Of particular interest in the piece by Goodpaster and Matthews was their distinction between 3 approaches to, or views on, the ethical nature of business:

The Invisible Hand: Based entirely upon economical and financial considerations, inheriting meaning from the Economic sense of the word, where the 'invisible hand' of the market controls the actions of those within it. Under this view corporations are required to pursue profit and revenue, and only consider anything else insofar as it affects those goals.
The Hand of Government: In this view, political and legal processes and systems will affect the operations of a corporation, requiring them to act in accordance with the greater good in order to continue operating at all.
The Hand of Management: Proposed by the authors, this approach suggests that the management of a corporation may indeed be capable of making their own ethical decisions in relation to the operation of their company, which would obviously also factor in financial and management-related issues simultaneously.

Definition: Virtual Corporation

In Coulson and Kantamneni's essay titled Virtual Corporations: The Promise and the Peril, they look at what a virtual corporation is, how it operates and the benefits and problems related to operating as a virtual corporation. They use Byrne's definition of a VC as "The VC is a partnership of companies that team up quickly to exploit fast changing opportunities. The partnership however is temporary so once the objectives of the VC are achieved, the relationship is changed or dissolved."

So in essence, the VC is virtual because there is no one, specific entity which can be pinpointed as labelled as an actor in the sense that a business may normally be a party in a transaction. In the case of a VC, a collection of corporations may act as a single unit, and yet have no legal or binding contract which holds them together. Under this arrangement, they have more freedom to come and go than they do in a conventional business agreement, however the entire success of VC's, according to a collection of sources cited, are "networking, excellence, opportunism or entrepreneurial orientation, trust and borderlessness."

Their discussion about the primary focus of VCs being in virtual products was interesting, and raises the question about whether VCs are anything new, or if they are merely the required business format for dealing with a new type of product (i.e. virtual corporation for virtual products, as per 'normal' corporation for 'normal' products).

Artificial Search Engine Positioning Schemes

Search engines form an integral part of our view of information online, with 39% of Americans using a search engine during January of 2004. With search playing such a central role in our access to the Information Superhighway, it is critical that search engine results pages (SERPs) contain relevant, appropriate results which correspond with what the user is searching for.

While search engines such as Yahoo, MSN and Google are constantly striving to improve the quality of their SERPs, businesses and individuals are also striving to get their sites listings improved; often for search terms which don't necessarily relate to that page. In fact, artificially influencing SERPs is such a problem that recent Microsoft research indicates that of their selected sample of the web, 8% of pages are spam, created to artificially affect positioning.

Major search engines are attacking this problem in a variety of ways. Google engineers are "working to improve every aspect of Google on a daily basis", MSN has their research team developing new identification techniques to prevent spam making its way into their listings, and Yahoo continues to employ methods such as paid inclusion to clean up heavily-spammed market verticals such as adult entertainment and online gambling. This ongoing battle means that search engines are in a constant state of flux, and search engine owners are continually playing a game of cat and mouse with the spammers and those who are attempting to improve their listings in an effort to keep SERPs relevant.

In their efforts to improve website listings, search engine spammers analyse the methods that the search engines use to rank normal sites, and then attempt to take advantage of those processes. One of the most common techniques is called 'link-spamming' or 'link-farming' and involves acquiring (or trading) numerous links from other (preferably related) websites, all pointing to their target site. This has the effect of making the page look more popular or important to search engines, thus affecting its position for certain keywords. Although this practise is also seen to some extent amongst 'honest' webmasters, it is virulent amongst those attempting to artificially boost their ranking, to the extent that people pay for links from other sites, never intending to directly attract people via those links, but to only attract search engines.

The problem for search engine owners is in identifying spam attempts, without penalising honest linking, keyword uses and other elements of web-development which can be used for spamming just as easily as they can be for normal web pages. Search engine spam is an ongoing problem, and given the importance of search engines to the process of finding anything on the Internet, one that's not likely to go away quickly or easily.

Topic 2.2 Notes

Since only 1 reading was really available for this topic, and I honestly didn't think it provided a particularly good representation of government's invovlement or influence in e-commerce, I thought I'd just do a bit of a brainstorm and review of how governments can affect the operations of e-commerce and those that operate online.

Following are a few of the ways that I can see governments directly affecting e-commerce, and any related resources that I know of which may be useful in exploring that avenue further:

Taxation: Governments control company and sales taxes within their respective states/countries, but what happens when a company is operating in one location, but effectively selling in another? Which tax applies? Do both? Do either?
Regulation: Certain types of operations (especially adult entertainment and gambling) may be legal in one country, and illegal in another. With the global reach of the Internet, how can (or do) governments enforce the legalities of municipality? What if a company is registered in one location, operates on a technical level from another location, and then transacts with people worldwide? Where are they liable?
Grants and Subsidies: If a government chooses to offer grants or subsidies to promote online business, how do they decide who to offer them to? Is it beneficial to provide benefits to a company operating within a country, if their sales are exclusively international? How about a company that operates from overseas, but directly services local residents?

Although there are no doubt specific resources available for specific governments, potentially more useful are those that try to provide a holistic look at the issue, since we are, after all, dealing with a system which affects the world. With that in mind, the following resources provide a wealth of links and direct information about the above topics:

E-Commerce Taxation Links: A huge collection of information put together by Annette Nellen of San Jose State University. Contains legislation applicable in US States, some of her own analyses on the topic, reports from government and commercial bodies and background information on conducting business online - an excellent resource.
E-Commerce Tax News: A news site focussing on all things which relate to tax that affects e-commerce. Offers email updates and appears to have been running since 2000.
International Taxation of Ecommerce: This site offers a wealth of links and updates related to taxation of online commerce around the world. It provides a series of 'rulings' relating to the application of certain laws, most specifically in the US.
Getting a Grant for a Website in the UK: The name for this page says it all. It provides a collection of links to external resources which may be of assistance for individuals or companies seeking grants in the UK.
The Electronic Commerce Directive (UK): "Online selling and advertising is subject to the laws of the UK if the trader is established in the UK". This page provides details of the regulations related to online business within the UK.