INFORMATION SYSTEM AND ELECTRONIC COMMERCE
GST-5083
Case Title :
Facebook : It’s About the Money
Group Members:
No
Name
1 SAYNUL ISLAM
2 DATO NABIL ABD KADIR
3 MOHAMMAD GHAZALI MOHD
DAUD
Student ID
P13D092P
P000000P
P000000P
Program
MBA
MBA
MBA
INFORMATION SYSTEM AND ELECTRONIC COMMERCE
GST-5083
Background
Facebook, a company grew up from a small network site to a
$50 billion company. Facebook was founded by 2004 by
Harvard student Mark Zuckerberg and originally called the
facebook. It was quickly successful on campus and expanded
beyond Harvard into other Ivy League schools. Facebook allow
users control and see their actions on advertisements.
INFORMATION SYSTEM AND ELECTRONIC COMMERCE
GST-5083
Perform an ethical analysis of Facebook.
What is the ethical dilemma presented by
this case?
INFORMATION SYSTEM AND ELECTRONIC COMMERCE
GST-5083
Ethical Analysis
Identify & Describe the
Facts Clearly
Define the Conflict or
Dilemma and Identify the
Higher-Order Values
involved
Identify & Describe the
Facts Clearly
Define the Conflict or
Dilemma and Identify the
Higher-Order Values
involved
Define the Conflict or
Dilemma and Identify the
Higher-Order Values
involved
INFORMATION SYSTEM AND ELECTRONIC COMMERCE
GST-5083
Facebook Ethical Dilemma
Facebook faces controversy over the handling and usage of the
extensive information it collects from its users. FB user’s biggest
concerns are the privacy and user controls over the information
granted to Facebook. Facebook faces the dilemma of how to gain
revenues from user information without violating their privacy. The
management and organization failed to consider its users privacy
concern when it introduced new software that users felt to be
invasive. Facebook provides a free service that users pay for, in
effect, by providing details about their lives, friendships, interests and
activities.
INFORMATION SYSTEM AND ELECTRONIC COMMERCE
GST-5083
Facebook, in turn, uses that trove of information to attract advertisers, app
makers and other business opportunities. Facebook occasionally isn't
enforcing its own rules on data privacy. Facebook requires apps to ask
permission before accessing a user's personal details. However, a user's
friends aren't notified if information about them is used by a friend's app.
Facebook provides people a specific social networking platform and
facilitates contents sharing and communication. It targets global netizens,
advertisers, and also application developers. Facebook partners with
different parties in the functionality, application developing, and advertisers
for enabling various features to meet users’ different social needs. To give
better services to right customers, Facebook exploits and analyzes
customer information, shares info with third party and provides ads to
targeted ones. It meanwhile gives users control on privacy setting, enables
a safe and trusted internet environment, which maintains a good
relationship with customers.
INFORMATION SYSTEM AND ELECTRONIC COMMERCE
GST-5083
What is the relationship of privacy to
Facebook's business model?
INFORMATION SYSTEM AND ELECTRONIC COMMERCE
GST-5083
Talking privacy to Facebook is a bit ironic. Facebook’s entire
business model is based on aggregation and sharing user
information. They give people a free social media platform to use and
in turn sell advertising and insights based on what they learn about
user. Facebook has massive capabilities to collect, store and analyse
data. This allows Facebook to sell very targeted advertising.
Therefore, privacy is the Facebook business model.
INFORMATION SYSTEM AND ELECTRONIC COMMERCE
GST-5083
Facebook states its regulations concerning to the rights and
responsibilities derive from the Facebook Principles, and govern the
relationship with users and others who interact with Facebook. The
relevant statements include Privacy Policy, Payment Terms, Platform
Policies, Ads Guidelines, Promotion Guidelines, Claims of Intellectual
Property Infringement, Claims of Copyright Infringement, etc. All
Facebook parties must comply with this policies.
INFORMATION SYSTEM AND ELECTRONIC COMMERCE
GST-5083
Describe the weaknesses of Facebook’s privacy
policies and features. What management,
organization, and technology factors have
contributed to those weaknesses?
INFORMATION SYSTEM AND ELECTRONIC COMMERCE
GST-5083
Allowing user’s information to be shared and made public.
Continued to let other users know what you were doing until
disabled it manually.
The incorporation and handling of its news feed feature. The news
feed feature provided other users that you are friends with updates
of actions that you performed while logged into FB.
Unable to delete FB account or any of the information that is on
user account. FB keeps a copy of user entire account even after
they deactivate it and no longer wish to have any affiliation with
Facebook.
INFORMATION SYSTEM AND ELECTRONIC COMMERCE
GST-5083
What management, organization, and
technology factors have contributed to
those weaknesses?
INFORMATION SYSTEM AND ELECTRONIC COMMERCE
GST-5083
Management:
Facebook assumed it had the consent of users to share
information about them that it collected through the Beacon
advertising service if they did not use the opt-out feature.
The company utterly failed to grasp the extent to which the service
violated its users’ privacy as well as the uproar such a service was
likely to cause.
Generally, it is a strategic management of FB’s to get its user to
share as much data as possible so that FB can serve relevant
advertisement to users. This is because FB revenue comes
almost entirely from advertising.
INFORMATION SYSTEM AND ELECTRONIC COMMERCE
GST-5083
Organization:
The personal information collected on the site represents a mother
load to advertisers, but one that will remain largely untapped if
Facebook users do not feel comfortable enough or have sufficient
incentive to share it.
Users that attempted to delete their accounts were met with
resistance and often required outside assistance from watchdog
groups.
FB wants the world to be more open and connected, because it
stands to make more money. However, the privacy controls over
the personal data is far from what FB currently offers. Moreover,
most of users are not really aware of the privacy setting in their
FB’s account.
INFORMATION SYSTEM AND ELECTRONIC COMMERCE
GST-5083
Technology:
 Facebook grossly miscalculated user privacy demands when it
launched the company’s Beacon advertising service because it
shared information about users that they had not explicitly
intended or agreed to share.
 The service originally began as an “opt-out” feature. Even after
users opted-out, the service continued to send information to
Facebook regardless of whether or not the user was logged into
Facebook at the time.
 A FB user’s friends are not notified if information about them is
collected by that user’s application. Many of FB’s features and
services are enabled by default when they are launched without
notifying users.
INFORMATION SYSTEM AND ELECTRONIC COMMERCE
GST-5083
Will facebook be able to have a successful
business model without invading privacy?
Explain your answer. Are there any measures
Facebook could take to make this possible?
INFORMATION SYSTEM AND ELECTRONIC COMMERCE
GST-5083
 No, obviously we don’t think that Facebook will be able to have a
successful business model without invading privacy.
 Facebook currently is serving as much to advertise and reach
people as it earns from those advertisements.
 There are no fees that are to be paid to join FB or for its use, it all
seems like they threw in a few advertisements and hoped that its
exposure would bring in consumers.
 Obviously, the backbone of FB’s business model is advertisement.
As a result, FB needs more users data to customized its ads and
indirectly invading individual privacy.
 It is a critical challenge for FB to avoid offends user’s privacy.
INFORMATION SYSTEM AND ELECTRONIC COMMERCE
GST-5083
Are there any measures Facebook could take to make this possible?
To alert all the members of FB with an electronic detailed letter
stating that for advertising purpose information that is submitted to
your information pages will be used by Fb company.
To give the users the options to either accepts or reject this offer in
order to install a legal standing that with the users of the site as
well as protect the integrity of the company.
To offer applications that could be put on their pages in terms of
interactive games and trivia, in return for allowing FB to access
users account for advertising purposes.
INFORMATION SYSTEM AND ELECTRONIC COMMERCE
GST-5083