INFORMATION TECHNOLOGY IN BUSINESS AND SOCIETYSESSION 13 – MIDTERM REVIEW

SEAN J. TAYLOR

ADMINISTRATIVIA

• Assignment 3 due 3/20Varun will email with instructions for handing it in.

• Midterm on Thursday

MIDTERM FORMAT

• 8 multiple choice• 4 true/false• 8 matching• 18 short answer questions

YOU ARE RESPONSIBLE FOR

1. Anything in a required reading

2. All lecture content and slides

3. Basic HTML knowledge from A2

4. “managerial level” knowledge of all technical conceprts

S01:TECHNOLOGY

SAMPLING: FROM ANALOG TO DIGITAL

Dhar and Sundararajan (2007)

1. DIGITIZATION2. MODULARITY3. COMPUTING POWER4. CONNECTIVITY

EFFECT OF IT?

1. IT TRANSFORMS BUSINESS AND SOCIETY

2. INVESTMENTS IN IT ARE CRITICAL TO THE SUCCESS OF ORGANIZATIONS

3. INNOVATION AND CREATIVITY IN THE USE OF DATA IS CRITICAL TO SUCCESS

S02/03:INTELLECTUAL PROPERTY

Before: protection only for published works with © attached, otherwise public domainAfter: protection for original works which are fixed in a tangible medium of expression

1. REPRODUCE2. CREATE DERIVATIVE WORKS3. SELL, LEASE, OR RENT4. PERFORM PUBLICLY5. DISPLAY PUBLICLY

BUT NO RIGHT TO UNDERLYING IDEA IS GRANTED. IT’S IN THE PUBLIC DOMAIN.

FAIR USEANY COPYING OF COPYRIGHTED MATERIAL DONE FOR A LIMITED AND “TRANSFORMATIVE” PURPOSE SUCH AS TO COMMENT UPON, CRITICIZE OR PARODY A COPYRIGHTED WORK. SUCH USES CAN BE DONE WITHOUT PERMISSION FROM THE COPYRIGHT OWNER.

DMCA: CRACKING DRM IS ILLEGALPassed in 1998, signed into law by President Clinton

Implements treaties signed in 1996 at the World Intellectual Property Organization (WIPO)

Supported by software and entertainment industries

DMCA TITLE II: OCILLA

Online Copyright Infringement Liability Limitation Act

Creates conditional “safe harbor” for online service providers (OSPs)

• Can make temporary copies to transmit them

• Not liable for infringement of your users!

HOW TAKE DOWN WORKS1. Jack puts content under Jill’s copyright on YouTube

2. Jill notices this.

3. Jill’s lawyer sends a letter to YouTube’s designated agent detailing the infringement.

4. YouTube MUST take the video down and tell Jack.

5. Jack can send a counter-notice to YouTube to have the content “Put Back”

6. If Jill doesn’t file a lawsuit within 14 days, YouTube must put the material back up.

SOPA POTENTIAL EFFECTS

Upstream/Downstream?

PATENTS

The right to exclude others from making, selling, or using an invention.

• Most comprehensive form of IP protection

• Even using independent discovery of same invention is excludable.

Criteria

1. Useful

2. Novel

3. Nonobvious

PATENTS: STILL RELEVANT?• Mutually assured destruction?

• Defensive only.

• Startups say that they are not important for competitive advantage.

• The right incentives?

How would you change the system?

If you had a startup, would you seek patents?

S04:IT STRATEGY

HOW DOES IT LOWER COSTS?Substitute information for physical assets or goods

• Information vs. parts inventory (Dell, Toyota)• Information vs. finished-goods inventory (Zara, Cisco, Walmart)

Increase the output from the same payroll

• Enable employees to work faster (tax returns at H&R Block)• Expand skills of employees (Progressive)• Outsourcing to lower cost regions (Microsoft call centers)

Substitute information technology for labor

• Self Service (FedEx, Citibank, Delta)• Automation (e.g., factory automation—Ford, Toyota)

HOW DOES IT ENABLE BETTER PRODUCTS?Increase product quality

• Create better products, enabled by IT (UPS, Progressive)

• Overlay better IT-enabled service on existing products (Amazon)

Increase product variety and ‘fit’

• Use local information about demand patterns (Zara)• Find out what your customers want and build it (Dell)• Convert uniform products into differentiated ones (Yahoo)

Increase pre-sale and after-sale support

• Pleasurable Buying Experience (Amazon’s One Click Shopping) • Expedited shipping and easy return policies (Zappos)

FOUR KEY INTERNET-ENABLED STRATEGIES4 Key Internet-enabled Strategies for Competitive Advantage:

1. Disintermediation

2. Mass Customization

3. Personalization

4. Global Reach

THE FIVE COMPETITIVE FORCES: REVIEW

Industry that you are analyzing

(focal industry)Bargaining Power

of Suppliers

The bargaining power of the firms that sell

inputs to the firms in the focal industry

Bargaining Powerof Buyers

The bargaining power of the customers that buythe finished products of

the firms in the focal industry

Barriers to Entry, orThreat of new Entrants

The threat of entryby potential entrants

(new firms) into the focal industry

Threat of SubstituteProducts or Services

The threat of products/services that could substitute (be used

instead of) the finished products made by the firms in the focal industry

Rivalry AmongExisting Competitors

The extent of rivalry between the existing firms

in the focal industry

firm = company = organization = business = competitor

THE INNOVATOR’S DILEMMA

1. Sustaining innovations

• improve product performance2. Disruptive innovations

• Result in worse performance (short-term)• Eventually surpass sustaining technologies in

satisfying market demand with lower costs• cheaper, simpler, smaller, and frequently

more convenient to use

S05:PLATFORMS

PLATFORM OR PRODUCT?

• part of a technical system whose components come from different companies or organizations

• relatively little value without complementary products or services

PLATFORMS ARE INEVITABLE

DIRECT NETWORK EFFECTS INDIRECT NETWORK EFFECTS

STANDARDS:SOLVE COORDINATION PROBLEMS

• governments

• corporations

• consortia

• professional associations

• standards-organizations (ISO)

• volunteers or developers

• de facto standards

TECHNICALLY, WHAT IS A PLATFORM?• A Hardware and/or Software system with an interface for

applications• Typically, a platform has an API--Applications Programming

Interface: an interface (i.e., a set of standardized commands) that the underlying “platform” can execute

• Software creators use the API when writing programs

Processor (Hardware)

Operating System

Application Programming Interface

Application Software (e.g., Office)

Application Programming Interface

Application Programming Interface

Customized “programs” (e.g., Excel Macros)

Hardwareplatform

O/Splatform

Applicationplatform

S06/S07:COMPUTERS AND THE WEB

BASIC COMPUTER ARCHITECTURE:INFORMATION REPRESENTATION• Numbers

• Text

• Pictures

• Audio

42 00101010

IT 01001010 01010100

.gif, .jpeg, .bmp,…

AU-Sun, WAV-MS, AIF-Apple, MP3

FROM ANALOG TO DIGITAL DATA000000000000000111111000001100001100001000000100010010010010010000000010010000000010001011110100001100001100000111111000000000000011000000000011

000000000000000111111000001100001100001000000100010010010010010000000010010000000010001011110100001100001100000111111000000000000011000000000011

BASIC COMPUTER ARCHITECTURE

TELLING COMPUTERS WHAT TO DO

SIMPLIFIED STRUCTURE OF THE INTERNETHierarchy of privately-owned networks

• Backbone network: High speed, city-to-city, with network access points, owned by large service providers (AT&T, Sprint, Level3)

• ISP networks: Connect from backbone to local areas (typically providing access to consumers)

• Local access networks: Access to individual computers

Internet:• No single authority• No single control source • No single entry point • No single type of application

LAYERS

INTERNET PROTOCOLEach Internet computer (host) has an IP address

• String of 32 ones and zeros (IPv4 -> IPv6)• Usually represented by four number segments separated by dots: dotted

decimal notation, e.g., 128.171.17.13• IP names (e.g., www2.nyu.edu) correspond to IP addresses

Routers

• Connect the Internet’s individual networks (subnets)• Cooperate to give an end-to-end route for each packet• Need to be very fast• Who is the world’s leading

seller of routers?

127.18.47.145127.47.17.47

TRANSMISSION CONTROL PROTOCOL

HTTP IN ACTION

HTTP IN ACTION

WORLD WIDE WEB

• web of hypertext documents• viewed by browsers• using a client–server architecture• HTTP: communication protocol• URLs: addressability• HTML: hypertext!

BASIC DOCUMENT STRUCTURE<html>

<head>

<title>My Awesome Webpage</title>

</head>

<body>

<h1>This is the heading!</h1>

<p>It was the best of webpages.</p>

<a href=“http://google.com”>Google</a>

</body>

</html>

MORE TAGS<ul>

<li>List item 1</li>

<li>List item 2</li>

</ul>

<h1>Big header!</h1>

<h2>Smaller header</h2>

<img src=“http://link.to/image.png”></img>

<div>Some content</div>

<span>Some content</span>

S08:ATTENTION ECONOMICS

S09/S10:SEARCH AND ADVERTISING

SEARCH ENGINES AND WEB DIRECTORIES

Resources on the Web that help you find sites with the information and/or services you want.

• Directory search engine - organizes listings of Web sites into hierarchical lists.

• Search engine - uses software agent technologies (or “spiders”, or “bots”) to search the Web for key words and place them into indexes.

SEARCH ENGINES DRIVE ECOMMERCE!

– Search engines discover new pages by following links

– Keep track of words that appear in pages and when you enter a query, the search engine returns a ranked list

– Text content is important! But is not enough! (Why?)

How do search engines rank pages?(why does this matter?)

HOW SEARCH ENGINES WORK

PAGERANK

People who bought this also bought…

BOOK A

book B

book C

book D

People who bought this also bought…

BOOK D

book C

People who bought this also bought…

BOOK C

book A

People who bought this also bought…

BOOK B

book A

book C.400 .133

.133 .333

.400/3

.133

.400/3

.133/2

.333.400/3 .133/2

(ignoring damping factor for illustration)

EXAMPLE

AdWordsPlacement

AdWords Placement

Most relevant sites

TARGETING BANNER ADS

Request for Ad from Ad Server

IP AddressCountry, Domain, CompanyBrowser, Operating System

Surfing Behavior from cookiesDemographic Data?

Targeted Ad isDelivered to

User

Context:Movie reviews

User Profile:NYU userNew York

FUTURE OF SEARCH

1. Information Extraction:Search on Structured Data

2. Social Search

3. Privacy Preserving Search

S11:IT AND JOURNALISM

KEY POINTS

• New low cost models of “journalism”

• A/B testing and response to consumer demand

• The move to real-time

• NY Times social media strategy (Tumblr integration)

• Disruptive innovations (Wordpress as a CMS)

S12:COMPUTER SECURITY

Computer crime and security

1. Understand some common forms of computer crime and their impact on individuals and businesses

2. Recognize some common classes of viruses, how they work, how they spread, and their impact on individuals and businesses

3. Understand how denial of service (DoS) and distributed DoS attacks are implemented

4. Discuss spyware, web defacing, identity theft and their consequences

5. Discuss some typical computer security precautions

6. Understand the basics of cryptography, symmetric key encryption, and public/private key encryption (and the applications in digital signatures)

VIRUSESWhat exactly is a virus?

• Program or set of programs

• Written to cause annoyance or damage (200 new ones every day)

Some commonly encountered viruses

• Welchia, SoBig, Blaster, Slammer, Code Red, Love Bug, Melissa

Some common types of viruses

• Stand-alone viruses – can run without a VB script.

• Macro viruses – infects an app and runs a macro or program. (can be an email virus like Melissa)

• Worms – Self replicating, unlike viruses do not need to attach to an existing program or app.

• Trojan horses (not really a virus but usually classified as such) – seems to one thing but performs another (e.g. install backdoors)

DOS AND D-DOS ATTACKS: WHAT ARE THEYDenial-of-service (DoS) attacks: • Attack a machine/server and make it unusable (e.g., flood a Web site with

so many requests for service that it slows down or crashes.) • Usually the attacker does not get access to the system which is being

attacked

Distributed denial-of-service (D-Dos):• Attack a single machine/server from multiple computers (e.g., flood a Web

site with so many requests for service that it slows down or crashes.)• The term “Ping of Death” is NOT used to describe the D-DoS described in

the textbook (i.e., the textbook is wrong)

E-trade, Amazon, Yahoo, Microsoft, Whitehouse…

SPYWARE

Software that gathers information about users without their knowledge

• Initially created for marketing purposes, and called adware. • Tracks Web surfing or online buying so marketers can send

you targeted--and unsolicited--ads

• Potential Damage: • Monitor keystrokes (including username, passwords, email

content); take snapshots of screen; scan your hard disk.

• Having a number of unauthorized programs running on your PC at once makes it sluggish, unstable, and, ultimately, more likely to crash.

• Monitors and transmits user activity to someone else. Other spyware may have a more malicious intent, such as stealing passwords or credit-card information.

FOUR CRITICAL INFORMATION SECURITY ISSUES Confidentiality

keeping information from unauthorized usage. Authentication

determining whose information you are receiving

determining who is on the other end before sending information

Non-repudiation preventing repudiation after an agreement by

dealing with digital signatures Integrity Control

determining whether the information you receive is genuine (or unadulterated).