Digital Social Responsibility: Searching for Ethics on the Internet

June 7, 2007

Keynote Speaker

Craig Newmark, Founder & Customer Service Representative,

John Delaney, Partner & Technology Transactions Practice Group Co-Chair, Morrison & Foerster LLP
Dunstan Hope, Director, Advisory Services, Information and Communications Technology, Business for Social Responsibility
Dave Morgan, Founder & Chairman, Tacoda, Inc.

Brad Stone, Technology Correspondent, The New York Times

A distinguished panel of Internet experts gathered to explore the ethical and social responsibilities of business on the 'net.

Keynote speaker Craig Newmark of is a perfect choice to speak on this topic, said moderator Brad Stone of The New York Times San Francisco bureau. "His users, his customers, at least a certain percentage of them, will challenge every ethical, legal, moral and taste boundary that there is. And then the company itself is certainly no stranger to accusations that it breaches some social responsibility by challenging and undercutting the newspaper industry, my industry, because of course it gives away for free something, classified ads, that we like to charge for."

"At craigslist, just to be very clear, I don't run it any more. I haven't done so for about seven years," Mr. Newmark began. "I actually act as a full-time customer service rep," and programmer Jim Buckmaster is CEO and runs the company.

"I haven't done any customer service now for about 10 minutes, which means that at the end of this afternoon I'll have a fair amount waiting for me, but that's my life right now."

Mr. Newmark has degrees in computer science and wrote the first couple of versions of the craigslist code, but said he regrets that he hasn't done tech work since he stepped down from running his company.

"Somehow, starting from a very simple e-mail list, we've become fairly successful, and from a business point of view, some of the reasons are fairly straightforward." craigslist was the first to create online classified ads, going back to about 1995--"I'm honestly not sure when I really started," he said.

The great majority of its services are free; craigslist charges for only about 1 percent of what's on the site.

"It's also very simple, and we've been able to take advantage of very good network effects, which means that the more people use our site, the more useful it is, and so that feeds on itself." The San Francisco Bay Area and the greater New York area provide the largest concentrations of craigslist customers, he observed.

"Somehow things work, but only in the last few years have I been able to slowly understand what really makes us work on a gut or emotional level."

"And it seems that somehow, working with our community, we've built a culture of trust. Somehow we've tapped into what seem to be universal values, at least in the U.S.," the notion "that you want to treat other people like you want to be treated."

"And that's how we try to run our site."

Mr. Newmark continued: "Now here I have to confess enormous ignorance, and I've actually spent a fair amount of the last week confessing enormous ignorance. For example, speaking to people at the UN, or some foreign press yesterday at the State Department, I have a good idea of what people's values are in the U.S., those based, let's say, on the Abrahamic religions, which are Christianity, Islam and Judaism; but my knowledge of a lot of this outside the U.S., there's a great deal I don't know about," for example, the concept in Japan of giri, or moral obligation, "which I need to understand better."

Although craigslist services are free to the great majority of customers, the company does charge apartment brokers in New York City to post their apartment listings, "because the real estate market is unique here. It's something of a blood sport. And actually the people we charge asked us to charge them, as odd as that does seem."

Day to day, craigslist's experience is that "people overall are overwhelmingly trustworthy," he said.

"There are bad guys out there; there are not many of them, although they tend to make a lot of noise." Spammers and scammers aim sometimes for financial gain, and sometimes for political advantage, by way of political disinformation attacks, which were particularly bad during the fall 2004 presidential election season, Mr. Newmark said.

"Since we trust the people in our community, what we've done, is if you look at an ad on our site, if anyone looks at an ad on our site, you can flag that ad for removal by clicking on a link. If other people agree with you, that ad is removed automatically. In a sense, people vote on what's suitable or ethical conduct on the site."

The flagging system is imperfect, he observed. "The person who most clearly addressed this was Winston Churchill, not specifically talking about our site, because he doesn't do much commentary these days, but he referred to democracy as being sometimes a poor form of government, but it's just better than anything else anyone has tried."

"Along these lines, we do feel a moral obligation to help deal with the bad guys" by working with victims and police, within the limits of the Electronic Communications Privacy Act, when there's an actual crime or a successful scam. The company has gotten to know quite well the NYPD computer crimes unit, and has found it to be very good. "For those of you who like CSI on TV, it's not like that," he commented. "It's like Barney Miller."

Beyond his craigslist role, Mr. Newmark has become personally involved in working to help newspapers and the press. The competitive effect of craigslist's free and low-cost job and car ads "has been greatly exaggerated, and newspapers have bigger problems than us," but as a private citizen, he said, "I'm concerned that we do need more people in the press speaking truth to power," more people like Stephen Colbert and Jon Stewart who are willing to shake up establishments in Washington and elsewhere, more support for investigative reporting, more security for the jobs of journalists.

"To help a republic democracy survive, you need lots of people studying, investigating, what's happened among the people who rule the country. That's really important."

"But I'm completely out of my depth in this regard," he went on, and thus he's lending support to journalists and others working on such efforts, including Dan Gillmor, author of We the Media, at the Center for Citizen Media; Fabrice Florin at NewsTrust; NYU journalism professor Jay Rosen, who's created a "pro-am" journalism site, NewAssignment.Net; Jeff Jarvis at BuzzMachine; Daylife, a New York-based "newsware" service in which Mr. Newmark has a small investment; and Jimmy Wales at Wikipedia, where "all of us have a chance to actually, literally, write history"; as well as other organizations that work on social issues, including contributions to the Sunlight Foundation, whose Congresspedia and other tools aim to increase transparency in the American government, and membership in OneVoice, an Israel-Palestine peace group.

"These days I kind of like to joke a little bit, telling people that the Internet was invented by this guy Johannes Gutenberg, about 550 years ago, and that that technology languished until a guy, a blogger, named Martin Luther; he, by virtue of the pamphlets he wrote, he invented the killer app for the early Internet, which was called the Reformation."

"Again, while I'm making light of this, it's mass communications, and people coming out of nowhere, with strong opinions, who are saying the right thing for their time. They changed history."

Moderator Brad Stone asked:

When I hear from commercial Silicon Valley sites about how their users do the monitoring, in their hands it seems somewhat self-serving, in that this allows a site to pursue big-business profits with a skeleton staff, 20 or 30 or 40 people. Is there a sense that these sites have an ethical or social responsibility to do their own monitoring?

"I'm not sure, because I really haven't thought about it from that perspective," Mr. Newmark replied. "I'm operating again from the idea of an internal sense of what's right and wrong, and that means if there's something wrong on the site, illegal or just something wrong by our community standards, we want that off our site."

"But we do know that no matter how large a company, we would have no way of enforcing that. Meanwhile, we notice that our community is collectively far smarter and more energetic than we could ever be, so by virtue of sharing the responsibility, that's worked remarkably well."

craigslist faced a lawsuit last year claiming that some of the apartment listings on the site violated the 1968 Fair Housing Act. Talk a little bit about how you responded to that.

Several issues were going on here, Mr. Newmark commented.

"In practice we find that when something discriminatory is posted, it's removed very quickly," whereas once such a listing appears in a newspaper classified, it remains there for a day or a week, some period of time until the next issue comes out; it's also extremely rare to have ads pop up on craigslist that create such concerns.

The plaintiffs cited only a very tiny percentage of apartment listings, and the complaints "kind of stretched the meaning of what they thought was discriminatory." As an example, he cited the plaintiffs' objection to an ad saying "there's a church around the corner, so that parking on Sunday morning is going to prove difficult": It's a stretch to call that discriminatory, he suggested.

What was the result in the case?

"It was dismissed on the basis of Section 230" of the Communications Decency Act, "which basically says that if you have a platform and someone abuses that platform, you're not responsible for that," answered Mr. Newmark. "It's kind of like, if somebody did something wrong over the phone, is the phone company responsible."

Why does craigslist allow anonymous postings? Wouldn't it be better if you required people to follow a more stringent signup process?

"That's a good solution for some sites. We just made a decision, based on our values, that we would be as open and democratic as possible," replied Mr. Newmark. Customers do have to present a valid e-mail address, he noted, and craigslist retains customer IP addresses.

"This presents a considerable downside for us, because it means a lot more hours spent on customer service than we would like; and for me personally, I've seen a lot of ugly things I would prefer never to have seen. But that's just life."

Digital certificates--there are some logistics issues, but "most of the technology's been on the shelf for years," and this will eventually enable greater accountability, he added.

Companies like Google, Yahoo, Microsoft, which have much deeper resources than yours and play a big role in shifting advertising away from print--do they have a responsibility to help old media survive? Should Google buy Dow Jones?

"That would be entertaining," replied Mr. Newmark.

"I'd like to see them get more active in this area," he added, referring to Google's Larry Page and Sergey Brin. "But again, that's an expression of what their values are, and I really don't want to be presumptuous in that regard."

Is Silicon Valley, the high-tech world generally, fulfilling its social responsibilities?

"I do feel most people want to make things better, but we don't know what to do, because we delegate a lot of that responsibility to our government, which sometimes succeeds and sometimes fails," in education and in other areas, he responded.

"That's why I think you now see people like Bill Gates, Warren Buffett, Pierre Omidyar or Jeff Skoll. What they're trying to do is they're setting aside billions of dollars, tens of billions, to try to figure out how to make things better."

Why has craigslist made so many unique choices--more community oriented than most corporations, less bottom-line oriented?

"There's nothing noble or altruistic about it," Mr. Newmark said. "Jim Buckmaster and I, we're both engineers, and we don't know any better. There's no MBAs in the company. We're just doing what feels right."

"And we both live pretty simply. For example, I don't think Jim has ever owned a car. I normally do own a car, but I tend to keep them for a while. Currently I have the old Prius. The new one looks pretty good to me, but I can't justify buying another car just because it looks really good and has better electronics. Although I'm tempted."

Questions from audience members followed:

Andrew Keen has a book out called The Cult of the Amateur that's highly critical about the lack of professionalism on the Internet. What do you think of his book?

A better treatment of amateurs on the Internet is found in New Yorker columnist James Surowiecki's The Wisdom of Crowds, Mr. Newmark said.

Mr. Newmark agreed that the Internet serves as a printing press for all, tech-skilled or not, and hence "there's an awful lot of crap on the 'net." More important in Mr. Newmark's view, however, is that there's also "an awful lot of good stuff on the 'net," including good, critical reporting about problems that the public would not otherwise see.

As craigslist gets larger and larger, as you become part of senior management and a bigger staff is hired, is your dedication to a spirit of ethics harder to maintain?

"First, thank you, but don't be impressed. All we're doing is just following through on some of the basic ethics that we all talk about, but kind of forget to think about."

"As for how to stay small while growing large, so far part of our solution is just to stay small, because the smaller a group, the easier it is to remember what you're about. And that's why we work very hard on making our site as self-service as possible. And that's also why we've begun to consciously articulate what our moral compass is, because that might help us remember that."

"Businesses come and go. If someone serves the community better than we do, we're toast."

Do you think there's enough thinking done in greater public space, in government, conversation about ethics and what they should be?

"I think it genuinely is happening," and grassroots discussions are percolating up to government and to the corporate world, he said. "In a strange way, people in government have helped out--right now we're seeing lots and lots of corruption in high office exposed, which is causing people to observe that, and then to start to report it, and then to build mechanisms to address that."

What should Web 2.0 represent, and what is your vision of Web 3.0?

Essentially Web 2.0 allows people to create something new out of results from multiple sites, for example, which pulls craigslist housing listings and combines them with Google Maps, Mr. Newmark explained.

"It's pretty cool, although frankly I regard our site as being more like Web 0.1, because we do something very simple and relatively low tech. The hard part of what we do is stuff like staying fast in the light of ever-increasing demand and traffic."

As for Web 3.0, there's no vision, but "I guess I do focus on" some of the efforts mentioned earlier, such as  "better tools to help people figure out together what's the more valuable stuff to read or watch, technologies like collaborative filtering and measures of trustworthiness."

With your overseas sites, in India for example, is the craigslist culture different than it is in the U.S.?

This isn't something craigslist has paid a lot of attention to, and the company is also behind where it would like to be on multiple language support, Mr. Newmark answered. "In non-U.S. cities we probably serve the expatriate community fairly well, but that's about it."

"We think we sense that people in other countries share many root values with people in the U.S. We honestly don't know, and I need to learn and hear more about that."


Dunstan Hope joined Business for Social Responsibility, a 15-year-old nonprofit organization based in San Francisco with offices in France and China, some 18 months ago to lead BSR's Internet and communications advisory group.

Mr. Hope confessed that as a historian and not an engineer, he stumbled upon the field of Internet technology pretty much by accident. However, he remarked, with Mr. Newmark's references to Winston Churchill and the Reformation, "I felt much more comfortable that I was in the right place."

China has been a recent focus of reports about freedom of expression and privacy on the Internet, Mr. Hope noted, but problems with filtering of sites deemed controversial and disclosure of customer records held by private businesses are by no means limited to China. A recent study of 44 countries by the OpenNet Initiative, a partnership among academic groups at the University of Toronto, Harvard, Cambridge and Oxford, found evidence of filtering in 25 of the countries surveyed.

"My role in all this is I think both a fairly tough one and a fascinating one," he said. BSR has teamed with the Center for Democracy and Technology, another nonprofit, to develop, together with five large technology companies and a number of academic and other organizations, a set of principles on free expression and privacy for Internet and telecom companies.

The five companies involved are Google, Microsoft, TeliaSonera, Vodafone and Yahoo; the 24 organizations range from the Electronic Frontier Foundation to UC Berkeley, Harvard's Berkman Center, and Amnesty International. BSR and the Center are acting as "neutral facilitators"; the principles being working out "are designed to be used when companies find themselves faced with laws, with regulations, with policies, that interfere with the human rights of free expression and privacy." The process has taken about six months thus far and is expected to be completed in another six months.

"All of these 29 organizations are on an equal footing; and the job that I have is to get them all to agree."

"If you read the Universal Declaration of Human Rights," which was adopted by the UN General Assembly in 1948, "it says up front 'the rule of law should provide the foundation of the protection of all human rights,'" Mr. Hope continued.

Historically, corporations faced human rights issues, for example regarding sweatshops and labor standards, where the laws are good, but governments aren't enforcing them, he said. With free expression and privacy, however, the laws are often very bad, and governments not only are actively enforcing those laws, but also are asking corporations to become enforcers themselves.

Thus companies that want to promote human rights of privacy and free expression have to challenge the law, and push back governments, which is not so easy to do.

Moreover, the problems in this area are very complex, Mr. Hope said. The Internet as an industry is global, it's evolving rapidly, and the mechanisms of production aren't well understood by nontechnical people. Those who work in CSR can readily understand how an apparel factory works, and that makes it easier to come up with solutions for supply-chain problems. It's much less common, he suggested, to have CSR people who understand the specifics of how filtering technologies work.

Recently, there's been something of a shift in conversations about these issues as companies enter new markets in historically closed societies, Mr. Hope said.

Earlier talks saw an emphasis on the promise of information access, on how the Internet might open up these societies.

More recently, however, the focus has shifted to the risks that companies face as they enter these new markets. "The Internet is not just this unregulated space, but the information can be censored, it can be blocked, it can be removed," and "there are also risks in terms of the personal information that organizations hold," questions on "who that information might be shared with, when, and for what purpose."

"These problems do seem quite real, and quite daunting," but Mr. Hope remains cautiously optimistic. "What sticks in my mind are stories about the blogs that remain up and don't get taken down, the websites that escape through the filtering mechanisms and are not censored, or the way in which text messages are increasingly used as a noncensored form of communication."

Morrison & Foerster's John Delaney said that technology lawyers love their work, not least because technology moves much faster than the law's ability to regulate it. "On a daily basis, I'm looking into my crystal ball, and helping clients work through legal issues where there's no law yet, where the law is developing." Clickwrap agreements, for example, were in use online for 10 years before legislation was finally enacted to give digital signatures the same dignity as those in pen and ink.

Far from being the Wild Wild West, in the U.S. "the Internet is highly regulated," with the CAN-SPAM Act, the Digital Millennium Copyright Act, the Communications Decency Act, Section 230 of which offers some safe harbors for website operators, the Electronic Communications Privacy Act, the Computer Fraud and Abuse Act, the E-SIGN Act--"essentially, for a huge amount of activity on the web today, there is a set of laws governing."

"And in addition, traditional laws like trespass have been extended to the Internet age, so hacking into websites, one of the theories that prosecutors go after hackers for is under trespass theories that were developed centuries ago, when people stole cattle," Mr. Delaney noted.

Some of the newest questions, about law and about ethics, are about user-generated content: "Is what YouTube does, is that legal? Illegal? Is it ethical? Unethical? If you're a copyright owner, you'll certainly feel it's illegal, and you may feel it's unethical" as well, he said.

Similarly, with P2P networks that distribute copyrighted materials, courts struggle to decide who's an infringer. With virtual reality sites like Second Life, people spend hours and hours designing their avatars--"do they have a property right in that?" he asked, noting that Taiwan recently has adopted legislation recognizing a property right of players in massively multiplayer online games in their virtual characters.

Individuals have personal moral and ethical codes, but companies "often have trouble determining what is right and wrong, particularly in new technologies where there's been no consensus formed yet on whether something is right or wrong," Mr. Delaney continued.

"As Craig mentioned, and it's one of the terrific features of the web, is the web actually allows us to help set ethical norms and enforce them," as with seller ratings on eBay and flagging mechanisms at craigslist and YouTube. "And of course the blogger community is a terrific watchdog."

For ethics violations online, the punishments are not fines or jail time. If an individual does something wrong but not illegal, the website can banish that person, though that just means the violator's IP address is blocked, and the person can join again from another IP address. "For corporations, the real punishment for ethical violations online is bad publicity."

Thus "one ethical issue I think for companies doing business online is overreaching," Mr. Delaney noted.

"Electronic contracts are generally enforceable," he explained, even if they do overreach and take advantage of the customer. This isn't the case if there's a violation of public policy--"so if a clickwrap agreement said 'and you shall deliver to us your first-born child,' that's not enforceable"--but absent the egregious situation, courts do enforce online contracts.

However, even if contract terms are enforceable as a legal matter, companies that overreach on the Internet risk trouble with their customers.

For example, Mr. Delaney recounted, until recently had some very long-winded and legalistic terms of service, including a clause to the effect that once a user posts something on the site, MySpace has extensive rights to it, and can turn around and sell the posted material to others without paying royalties to the creator of the work.

This did not sit well with an English musician named Billy Bragg, who was using MySpace to post his new compositions. Mr. Bragg started an e-mail and petition campaign against the MySpace contract. The Musicians Guild got involved, and MySpace changed its contract language.

The new contract "is much more kinder, gentler: 'MySpace does not claim any ownership right'--the very first thing they say, we're not going to own any of the music posted on our site; and it goes on to say, 'We do ask for a license,'" and to explain why: "'without this license, we would be unable to provide the MySpace service.'"

"And I think frankly we're seeing that trend. Companies pay more attention to this language."

The bulk of offline transactions don't require these nuances of language, Mr. Delaney reminded the audience, because "in the traditional offline world, traditionally your relationships with your vendors, the people who sold you things, were face to face. You went to the grocery store. There weren't contracts imposed between you and your purchase. Now online there's a contract," and thus "there is this possibility of overreaching, because these contracts can never be negotiated."

"And so this Billy Bragg incident I think is an example of how a community can, it can backfire on a company if they're too aggressive.

"And I don't mean to suggest that MySpace was too aggressive, and in fact from a legal standpoint the new policy really isn't much different from the old policy," Mr. Delaney remarked. However, "it's in plain English, and it's much easier for users to understand."

"I work in the online advertising industry, and I work in a particular part of the online advertising industry, in targeted advertising, in advertising that's targeted by consumer behaviors, an area that gets close to a number of ethical issues," said Dave Morgan of Tacoda, Inc.

"First, because I'm a big believer in one of the nice things that I think the web culture has brought, one of transparency, I should tell you my biases," he continued:

"One, I used to be a lawyer, a newspaper lawyer; you should know that."

"Two, as I've already said, I live in the advertising business. That's what I do, I believe in it, so I will have biases with that."

"Three, I'm an eternal optimist." In a prior job, Mr. Morgan went out and got a tattoo on his ankle, the name of his then employer, a tattoo that's still there. So clearly, he said, "I have problems seeing the half-empty issues."

"Four, I like to think of myself as an internationalist or an aspiring internationalist, but I have to admit I didn't have a passport until I was 33 years old, and except for my wife being from Mexico and I've now been all around the world a lot, I'm still on the aspiring side of that."

Tacoda's customers represent a network of about 4,500 websites in the U.S., including The New York Times, the Wall Street Journal, most newspaper sites; MSNBC; Fandango, Sporting News, Mr. Morgan said; "in fact 80 percent of U.S. consumers browse on Tacoda websites every month; and actually the amount of time we see the average consumer is about 50 times per month."

The way Tacoda's system works, he explained, is that as a user browses customer sites, Tacoda gets anonymized data on what sites the user visits. "We don't know who the person is, we don't know their e-mail address, we don't keep their IP address. But we know that this browser looked at international travel on and then went to CBS Sports and now may be on Fandango."

"So that means is that every time we see these browsers, and where there is an advertising message opportunity," Tacoda uses this anonymous data to deliver a banner ad that's tailored to the user's browsing history.

"Most commercial websites today have technology on them, most of which was actually built by my first company, that delivers different ads to different people. So if you all go to homepage right now, collectively you will probably see 20 some different ads. You won't get the same ad. Decisions are made in those few milliseconds when those pages are being delivered to determine what's the best ad for you."

The ethical challenges and responsibilities of this business mean that "the consumer is in charge," and "if the consumer doesn't like what you're doing, you're going to have a real problem, it won't be sustainable, it's not going to be a business," Mr. Morgan declared.

Online media now represent over 20 percent of total U.S. media consumption--but of total revenue generated by the online media sector, only 0.1 percent goes to the media providers, he stated. Consumers are willing to pay subscription fees for print newspapers and magazines and for cable TV; but for online media like and craigslist, 99.9 percent of revenue comes from advertising.

Furthermore, Mr. Morgan emphasized, if the information an online company collects "might be viewed as personal, whether it's personal or not, you are dealing with fire, you are dealing with something that is incredibly important, that is a touchpoint, and you better manage it very well."

This means companies have to give the consumer transparency, notice and choice, before collecting and storing and using such information.

Consequently, Tacoda has chosen to work only with anonymous information, and does not collect e-mail or IP addresses. Moreover, Mr. Morgan said, "we actually proactively send ads to people that say 'by the way, we're delivering ads with your anonymous data, and if you don't want to be part of this, click this, and you'll be opted out, and you won't get them'"; 140 million consumers get these ads at least once every six months.

"In many cases," Mr. Morgan concluded, "the Internet companies are being run by younger managers who aren't as experienced, and aren't as schooled sometimes, particularly in social sciences and in social responsibility." Thus Google, which "possesses without question more information on more people than anyone else in the world," does not have a chief privacy officer, and currently has no executive who's in charge of privacy policy and reports directly to the CEO. This is a practice that ought to be reconsidered, he suggested: "I think that's the kind of thing that you have to be able to raise to that level."

Moderator Brad Stone asked the panel:

Even if it's claimed the data that are tracked are not personally identifiable, we know from things like the leak of AOL data last year that it's pretty easy to tell who you are by what you d

Topics:  Business, Social Issues

Calendar of Events

February 2018

S M T W Th F S
        1 2 3
4 5 6 7 8 9 10
11 12 13 14 15 16 17
18 19 20 21 22 23 24
25 26 27 28      
All content © 2018, Japan Society, unless otherwise noted. |
333 East 47th Street New York, NY 10017 Phone: 212.832.1155 |
Credits | Press | Contact Us | Privacy Policy