BUSINESS ETHICS

BBS20703/FBS20103/BMK21703

ASSIGNMENT
GROUP ASSIGNMENT

PREPARED BY:
1. PEY YAO YANG
(012023021913)
2. POOJA MURUGAN
(012022021766)
3. CECILIA BERMAS
ANAK JATAN
(012019070106)
4. 012

PREPARED FOR:
MISS NURUL NADIA MOHAMAD HAMIDI

SUBMISSION DATE:
18TH MARCH 2023
 1. INTRODUCTION

Internalizing ethics in the conduct of business refers to the process of integrating ethical
principles and values into the day-to-day operations of an organization. This involves
developing a culture of ethical behavior within the company and ensuring that employees at
all levels of the organization understand the importance of ethical conduct.

As we know the internalizing ethics in the conduct of business is a crucial aspect of creating a
sustainable and responsible business model that prioritizes ethical behavior and upholds the
values of the organization.

A company that specializes in digital downloads provides a good case study for internalizing
ethics in the conduct of business. The company offers a range of digital products, including
music, movies, and software. The case study based on “Repeated and exploitative
unauthorized copies of copyrighted works were made to save the expense of purchasing
authorized copies.”

This assignment also needed us to answer the question are given, and we will give our answer
and opinion of this case study, relate to the Napster violated copyright laws, stating that,
“Repeated and exploitative unauthorized copies of copyrighted works were made to save the
expense of purchasing authorized copies.”
2. CASE STUDY

The case study discusses the challenges and debates surrounding copyright laws and file-
sharing in the digital age, with a focus on the Napster file-sharing service. Created by two
teenagers in 1999, Napster quickly gained over 20 million users who shared music files
without compensating the artists or producers. This sparked legal battles over copyright and
distribution, resulting in court rulings that Napster violated copyright laws. While some
artists formed a coalition with record companies to combat piracy, others saw piracy as an
opportunity to reach larger audiences and drive sales through increased popularity. Napster's
innovations led to the development of payment-based services like iTunes and Pandora, but
the debate over artist compensation continues, as seen in Taylor Swift's open letter to Apple
in 2015. Apple responded by changing its terms of agreement to compensate artists at a
reduced rate. The case study highlights the importance of balancing copyright protection with
access and innovation in the digital age.

The point of this case study is to highlight the complex issues surrounding copyright laws,
file-sharing, and artist compensation in the digital age. The case study uses the example of
Napster to illustrate how technological innovations can disrupt traditional business models
and raise ethical concerns related to copyright protection and fair compensation for artists and
producers. The case study also shows how the development of payment-based services like
iTunes and Pandora has attempted to address these concerns, but the debate over artist
compensation continues. Ultimately, the case study underscores the importance of balancing
copyright protection with access and innovation to promote a sustainable and responsible
digital economy.
3. QUESTION

1. Artists generally agree that piracy causes financial harm, but some artists recognize that
piracy creates exposure for the artist and access for the listener. Do you think the benefits of
piracy outweigh the harms done? Why or why not?

2. Along with other file-sharing services, Napster helped to stimulate payment-based

services such as iTunes, Pandora, and many others. Do you think this positive outcome
justifies Napster’s illegal activities? Why or why not?

3. If Apple had not agreed to compensate artists in response to Swift’s open letter, do you
think it would be ethically questionable to subscribe to their service? Are you, as a consumer,
more likely to subscribe as a result of Apple’s response? Why or why not?

4. In cases of piracy, it is difficult to conceptualize everyone affected. Which of the ten

moral rules (identified by Bernard Gert) does piracy violate? Other than the artists, who else
is potentially affected by piracy? Does a broader view of the people affected and harms
caused change your opinion on piracy? Why or why not?
4. ANSWER

Answer for question 1

While piracy can create exposure for the artist and access for the listener, it can also cause
financial harm to the artists and producers who create the music. Without proper
compensation, artists may not have the resources to continue creating new music or may need
to rely on other sources of income, such as live performances. Additionally, piracy can affect
the record industry as a whole, potentially leading to job losses and reduced investment in
new talent. On the other hand, some argue that piracy can benefit the industry by promoting
new artists and driving album sales through increased exposure. Ultimately, the issue is
complex and requires a balanced approach that considers both the benefits and harms of
piracy to promote a sustainable and responsible digital economy.

Answer for question 2

However, it is important to note that Napster's illegal activities, which involved the
unauthorized distribution of copyrighted materials, caused significant harm to the music
industry and the artists and producers who create the music. While it is true that Napster's
innovations helped to stimulate the development of payment-based services such as iTunes
and Pandora, it is important to recognize that these services operate within legal frameworks
that protect the rights of copyright holders and ensure fair compensation for artists and
producers. In contrast, Napster's activities violated these laws and caused significant financial
harm to the music industry. While it is important to acknowledge the positive impact that
Napster's innovations had on the development of the digital music industry, it is also
important to recognize the harm caused by its illegal activities and the need to uphold
copyright laws and ethical business practices.
Answer for question 3
If Apple had not agreed to compensate artists in response to Swift's open letter, it would have
been ethically questionable to subscribe to their service. Apple's initial decision not to
compensate artists during the first three months of their service was unfair and disrespectful
to the hard work and creative output of the artists and producers who create the music. It is
important for companies to recognize the value of creative work and to ensure that artists
receive fair compensation for their contributions.

However, it is possible that some consumers may be more likely to subscribe to Apple's
service as a result of their response to Swift's letter, which demonstrated a commitment to
ethical business practices and respect for the rights of artists and producers. Consumers may
be more likely to support companies that prioritize ethical considerations and demonstrate a
commitment to responsible business practices.

Answer for question 4

Piracy violates the moral rule of "Do not deprive others of their goods," as identified by
Bernard Gert. This rule emphasizes the importance of respecting the property rights of others,
including intellectual property. Piracy involves unauthorized use and distribution of
copyrighted materials, which can harm the interests of the copyright holders by depriving
them of their rightful compensation.

Other than the artists, piracy can also affect record labels, publishers, and distributors who
depend on the sale and distribution of copyrighted materials. Piracy can also have economic
consequences for retailers and other businesses that sell and distribute copyrighted materials,
as well as for governments that rely on tax revenue generated by the sale of such materials.

Taking a broader view of the people affected and harms caused by piracy can change one's
opinion on piracy. It is important to recognize the complex economic and social impacts of
piracy, which can extend beyond the immediate harm to copyright holders. While exposure
and access to content may be positive outcomes of piracy for some, it is also important to
consider the long-term effects on creative industries and the broader social and economic
implications of disregarding intellectual property rights. Overall, piracy is a complex issue
with multiple perspectives, and it is important to balance the interests of all stakeholders
involved.
5. Conclusion
In conclusion, the case study of Napster and Taylor Swift's open letter to Apple highlights the
complex ethical issues surrounding piracy and copyright infringement. While piracy can
provide benefits such as exposure and access to content, it also harms copyright holders and
other stakeholders in the creative industries. The case study demonstrates the importance of
balancing the protection of intellectual property rights with access and innovation.

The learning outcomes from this case study include understanding the ethical and legal
implications of piracy and the need to respect intellectual property rights. It also emphasizes
the importance of considering the broader economic and social implications of piracy,
beyond the immediate benefits and harms to specific stakeholders. Finally, the case study
highlights the role of technology in shaping the creative industries and the need for ongoing
adaptation and innovation to maintain a balance between access, protection, and
compensation for creators.
6.References
1. https://en.wikipedia.org/wiki/A%26M_Records,_Inc._v._Napster,_Inc.

2. https://www.socsci.uci.edu/lawforum/content/journal/LFJ_2004_compilation.pdf

3. https://www.theguardian.com/music/2022/dec/13/taylor-swift-shake-it-off-copyright-case-
dropped
4. https://www.hollywoodreporter.com/business/business-news/taylor-swift-shake-it-off-
copyright-suit-settles-before-trial-1235280645/

7. Appendix