Legal Issues of Social Networking Sites

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Legal Issues of Social Networking Sites

What is social networking?

The term social networking was first introduced by J.A.Barnes in the year 1954 to refer to a map of the relationships between individuals, indicating the ways in which they are connected through various social familiarities ranging from casual acquaintance to close familial bonds. The aim behind a social networking website is simple — to ‘hook up' people with similar interests. It is quite similar to a physical social network. Meeting new people, establish contacts, keeping in touch with the contacts, and stay on with the relationship. In a professional environment, many connections are established by middle person. These are people common to both parties involved, and facilitate initial contact.

This is where social networking over the Internet is so revolutionary. It allows like-minded people to find each other, beyond the physical network, and across time zones. People can simultaneously be part of an unimaginable number of social networks formed around fairly common topics like bands or a particular celebrity, to some obscure topics like a specific kind of hairdo or an element in the periodic table (Sharma, 2008).

In both professional and personal life, human beings customarily form groups based on affinities and expertise. We tend to be drawn towards others with whom we share interests. A lot of us are members of real world networks that formed naturally. These networks quickly moved to the online world. Online social networking has been around in various forms for nearly a decade, and has begun to gain wide notice in the past few years. Online social networks take many forms, and are created for many reasons. Even though they have their own differences, online social networks do, however, generally display a variety of the following concepts. Profiles - Each member in a network has an online profile that serves as the individual's identity in the network. In the professional ambience, profiles often consists information pertaining to the individual's experience, education, interests and affiliations, as well information about the individual's skills and resources. Connections - Online social networks typically enable individuals to make connections with others in the network. In some cases, these connections are implicit, and derived from past actions (such as sending an email to another member of the network).In other cases, the connections are explicit, and are set up and created by the members themselves. Deceivingly plain, online social networks contain great power. They change the online space from one of static web pages and dry marketing messages to a energetic, electrifying network of connected individuals who share their abilities, expertise and interests (January 28, 2010,Cerado website)

Types of Social Networks

There are two kinds of social networks:

1. The indifferent social network: These are the kind of networks most frequently used. Examples of such networks are MySpace. Facebook, Orkut. These networks have no bias, or prejudice, against their users. There is no preference when it comes to the type of the users in these networks.

2. The niche network: The second type of networks is discreet networks. Example of such networks is Withnin3.It is a community of physicians and health researchers. According to this website, patients can be taken in for clinical trial and they can be informed about the latest advancements in the medical field. One can register on the website only if they have been invited by an existing member. Physicians or researchers in the health sciences or students getting trained for an advanced health science degree can register on the website. But this is not the only feature that distinguishes it from discreet networks (Sharma, 2008).

Uses of Social Networking Sites

Building Connections - Social networking sites generally include a directory for members to find others who share similar interests and backgrounds. Members grow their individual networks by connecting with other members. Most social networks require mutual consent before members are considered "connected."In individual profiles, members post information about themselves, their interests and activities as well as affiliations, education and occupational background. Social networks often allow members to set a privacy level to their profile according to their needs, such as whether to let any member of the network to see their profile content or to limit it only to the connected members and may allow even further refinement of access control within the connected community. Members often post non-original content to their profile pages, such as photos and videos. Some social networks allow members to create groups. The group may be limited to those members having a particular affiliation (such as Automation Alley's LinkedIn Group) or revolve around a specific topic, such as interest in a common political cause. Members joining groups interact with other members within the group even if they are not otherwise connected.

Business Uses: Internet is a very good place to interact with the customers and by knowing the customers better they can be offered better service. Doing things on the Internet has the positive impact of eliminating physical boundaries. To work with physically separated people that are connected through a strong common thread, like various colleges of a university, or regional offices of a multinational corporation, a social network is an ideal extension of a bulletin board or a company intranet. , members may use social networks for professional development to replace face-to-face networking, to describe business efforts and opportunities or seek advice or opinions by asking questions to the social network community. Promoting events on Facebook can result in more extensive, widespread scope than an organization could obtain anywhere else as notifications are sent to all of a member's friends when that member hosts an event.

Companies may even use social networking to promptly respond to critics. Social networks have been useful in several cases to gather criminal evidence. Organizations of all sizes are exploiting Social Age tools to encourage more effective collaboration by their employees, clients, and business partners. Employment agencies make extensive use of professional networking sites such as to identify potential candidates. Likewise, employers use to advertise jobs. Retail companies use social networking tools to drive sales and marketing. Everyone, it seems, from giant corporations to grade-school students, are selecting products and suppliers with reference to satisfaction ratings and reviews. But for most organizations, the greatest value in social networking is found in (Ossian, Paddock, and PLC).

Teaming and Collaboration: Tools provide valuable support to employees, business partners and clients. The reach of the organization improves when tools are available for people to know each other, leading to effective team building. In a 2008 paper, the journal of the International Association for Human Resources said that people with better social capital (Azua, 2009)

* Close deals faster

* Enhance the performance of their teams

* Help their teams reach their goals more rapidly

* Help their teams generate more creative solutions

Tells about the Business

Most websites permit the user to post bulletins or blogs for people who have requested to connect with person on his/her site/blog. This gives businesses an opportunity to advertise weekly specials, sales, or new products/services. For most people, the Web is one of the primary places they visit to search for information. By existing online a company can make sure that their business is on the top of the list of things a customer comes across in a search online (Azua, 2009).

Allows for Customer Feedback

Social networking sites aid as an outlet for where a company can really look into various opportunities of connecting with the customer and request for feedback. Entertainment places or restaurants may request connected customers to upload pictures and post comments about their experiences at these business locations, this would increase the publicity of these businesses as the people connected to the members might get interested in those places too(Bax, Reviewed January 26,2010)

Use of Social Networking in Corporate Environment

From an external focus and marketing point of view, social networks are very important. Businesses need to address the hundreds of millions of social networkers—the demographics are hard to miss. Businesses need to understand the kind of sites their customers visit, their social and connection activities, and the things they do and are interested in, as well as the viral nature of this medium. The usage of pre-existing social networks for business purposes is especially important to understand. It can work for the business and against the business, for example a bad feedback of a customer can spread very quickly. Social networking also enables community building, collaboration, and building relationships engaging with others at various levels including sharing interests, experiences and media like photos and videos.

From a customer interaction perspective, the major business benefit of social networking is in increasing responsiveness to the market place, making the company or business unit approachable to customers from all sides. Communities, R & D forums, and support networks all fall in the social networking category. When combined with the viral nature of social media, rich customer interaction will become the major requirement for social networking systems in an organization.

Although corporations can hardly find business explanation for developing and supporting consumer social networking. From an internal perspective, social networking offers extraordinary opportunities for productivity and better working conditions in many ways: facilitating employees to find the correct information and the correct person to talk to for more appropriate particulars; taking advantage the wisdom of crowds in tagging, bookmarking, and reading materials; and improving communication by giving employees more information about co-workers inside and outside the company. Enabling employees to navigate through corporate hierarchies via a social graph and a knowledge graph over a Facebook-like platform is very real and can improve employee productivity. After all, most work is done via the informal social connections, which, many times, are independent of the formal hierarchy. Being able to harvest the knowledge graph would be especially powerful. Another social networking application in intercompany collaboration is the capability to search for expertise and then extend that connection to enable collaboration.

Some Examples of Social Media for Business Benefits:

Dell Makes three million dollars on Twitter: The DellOutlet on Twitter has more than 600 thousand followers on twitter. Dell keeps posting links to discounted computer hardware on this website exclusively for its followers on twitter thus increasing the sales. The main things that contributed towards this are holding conversations with customers, raising awareness, increasing sales, connecting customers. Dell not only posts deals on twitter but talks to its customers about their experiences, good or bad. Currently Dell has more than 80 Dell branded twitter accounts providing everything from videos of new technologies to promotions for Asia-Pacific customers. It also encourages employees to twitter, and has well over 100 employee accounts. Dell uses many of those accounts mostly for customer service communication that requires direct messages to people who are twittering about Dell.

Nike's Brand building: Nike launched in the year .This site tracks data of every run and connects runners around the world at this website. In August 2008 around 800,000 runners logged on and signed up to run a 10K race sponsored by Nike simultaneously in 25 cities.

Other examples include, Best Buy is benefitting from its home-grown social network called Blue Shirt Nation for knowledge exchange between employees, project management, and executive communication .Another example application of social networking in the enterprise setting is IBM where social media is employed not only for internal productivity but also as a vehicle to engage IBM alumni for professional networking. Another interesting application of the social graph is for social network analysis. MWH, an engineering firm, uses social network analysis to improve collaboration and identify communication bottlenecks. Other companies such as Microsoft and Pfizer are also employing this technique to analyze work-force dynamics with the business goal of improved communication and increased productivity.

Other Findings

* A Cisco study in 2004 revealed that 43% of visits to online support forum are in substitute of opening up a support case through standard methods.

* Cost per interaction in customer support averages $12 via the contact center versus $0.25 via self-service options. (Forrester, 2006)

* Jupiter Research (now Forrester) reported in 2006 that customers report good experiences in forums more than twice as often as they do via calls or mail.

* Ebay found in 2006 that participants in online communities spend 54% more than non-community users.

Issues Faced by Businesses: Even though social networking is quite useful for businesses there are also some things that the business owners need to keep in mind the legal risks of using social network sites. A company should recognize and manage the risks ahead of time. For example an Investment firm must log every communication with client .It's hard to do that with IM's. Another issue is confidentiality there especially for medical professionals and financial advisors and /or anyone with non disclosure agreement. But it's too easy to reveal the information through social media.


AstroSpace twitter account: Twitter user astrospace had approximately around 24000 followers, Motivated by a dispute with Twitter astrospace deleted his account. Seeing that the account name was available a user allegedly snapped in and took the account causing much confusion. Eventually astrospace returned back to his account but far less credibility. Such happenings can be damaging to a businesses.

HillStone Restaurant Case In this case, the employer accessed a employees MySpace account ,dedicated to criticize the employer without permission. The employer was liable for the invasion of the privacy and violation of the federal Stored Communication Act. A Myspace page was put up by an employee and was used by many employees to discuss work. The manager saw negative comments about the restaurant where they all worked. Management then coerced a co-worker into providing the log in and password. They later fired two employees for poor attitude based on their comments on the private Myspace page. Pietrylo v. Hillstone Restaurant Group, Inc. A jury trial found in favor of the two fired employees and against the restaurant.

Legal Issues Involving Social Networking Sites:

Social networking applications have their challenges as well—from security and privacy to compliance to corporations banning them to data portability issues to mushrooming frivolous applications to viruses to copyright violations. Some people believe that though not quite ready for use in enterprise applications, Facebook, Twitter, and the others can prove useful in helping colleagues and customers connect, so long as businesses employ a trust model and appropriate usage policies.”Also users have to keep in mind that existing laws apply equally to online and offline conduct.

Third Party Content : Anytime a content is published on a social networking site including graphics ,text ,photos or other media content ,compliance with you are publishing content on a social network, , compliance with applicable copyright laws is an important consideration.

Content-related risks must be taken into account when engaging in social networking. While the technology of the Internet may easily allow text graphics, photos and logos to be copied and pasted from one site to another, doing so will in most cases, violate copyright law. Using any third party content, i.e., photos that were taken by or belong to someone else or grabbing a video or song off of a third party web site without permission can result in both criminal and civil liability, including treble damages and attorney fees under the U.S. Copyright Act, 17 U.S.C. Section 101, et. seq.1 Copyright holders can take stringent measures to enforce their rights. In 2007, Getty Images, Inc., the world's leading provider of visual content, established a partnership with PicScout, a company that makes use of complex crawling and image recognition technology to track down unauthorized use of Getty Images' copyrighted works online. Getty pursues statutory damages under the U.S. Copyright Act based on each separate occurrence of infringement, such as each use of a single image on multiple web pages(Ossian, Paddock, and PLC).

Criminal Activity: Postings of text and photos on social networking sites have been the source of discovery of criminal activity and, ultimately, evidence of crimes. Social networking activities have also served as a catalyst for offline criminal activities and charges.

Social networking can itself constitute or lead to criminal activity. A very famous case involves Lori Drew, a Missouri woman, who created a fictitious MySpace account to pose as a teenage boy pretending to be interested in an acquaintance of her daughter. When the girl discovered the ruse, she committed suicide. Ms. Drew was charged with various counts, including felonies. In November 2008, Ms. Drew was convicted of three misdemeanor counts of computer fraud. In January 2009, a British man who killed his wife over her listing her Facebook status as "single" received a sentence of 18 years(Ossian, Paddock, and PLC).

Defamation: Lawsuits alleging defamation based on online content are not surprising and are generally treated by courts in the same manner as those involving conventional defamation claims. For example, an attempt to expand the State of Texas' one-year statute of limitations for online defamation was rejected by a federal district court. Unlike other online defamation claims that often involve anonymous posters, however, defamation occurring on a social networking site is likely to be attributable to an actual individual. This magnifies the risk of liability for such online activities.

Issues concerning use of Social Networking sites at workplace

Though we have seen how social networking sites can be useful for businesses there are certain legal issues and concerns regarding using social networking sites at work place.

Privacy risk: What if the company is monitoring the use of the computer by its employees and keeps track of all the interactions of the employees with their contacts? This can have an effect on the employee's position at the workplace.

Network security and Defamation: The social networking sites can pose serious threat to the network security and also be a cause for viruses. Also, The consequences of posting defamatory or other content that could form the basis for a tort action can flow not only to the individual poster but, potentially, also to the poster's employer or affiliated group under a vicarious liability theory. The plaintiff would, of course, have to prove a case against the organization, however, defense costs, even to get to the point of a summary judgment motion, can be significant(Ossian, Paddock, and PLC)..

Productivity Issues:” Nucleus Research, an IT research company, reported in July that employee productivity dropped 1.5 percent in organizations which allowed complete access to Facebook at the workplace. The survey which consisted of 237 corporate employees also showed that 77 percent of workers who have a Facebook account use it during work hours. It was also discovered that some employees are of the habit of using social networking site up to two hours a day at work, and that one in 33 workers surveyed use Facebook only while at work. And of those using Facebook at work, 87 percent said they had no clear business reason for accessing the network.”Also it might decrease employee concentration and they can e less focused on their work.( Wavecrest Computing)

Employment Practices: Social networks are used as a source of information about individuals and organizations. Members may not have an idea of the full impact of comments made or content posted on a social network profile. “According to a survey by, over twenty percent of hiring managers customarily review online profiles while evaluating job applicants. More than one third of those managers indicated that they have eliminated a candidate from proposal based on what they found in an online profile” (Wavecrest Computing).

Content Ownership/Control

When posting information on a social network, members definitely believe that their profile content, photos, etc. are completely under their control and belong to them but this is really not the case .A recent modification made by Facebook to its Terms of Use brought this issue to the limelight. Facebook deleted a sentence from the Terms stating that its users' license grant to Facebook for user content automatically expired when the user removed the content. This deletion, among other changes, created such uproar throughout the Facebook user community that Facebook made a sudden 180-degree turn by replacing the sentence and explaining that it never attempted to change its privacy practices Social media tools provide an instantaneous means of communicating with your entire online community. Using these tools in haste can lead to accidental and perhaps even devastating outcomes. A perfect example is the undoubtedly well-intended ‘tweet' from Congressman Peter Hoekstra that he had just landed in Iraq for what was supposed to be a secret trip (Ossian, Paddock, and PLC).

Necessary Steps to be Taken by Employers

A good blogging and social networking policy should cover the following topics:

* Employees should not be permitted to share the employer's confidential and proprietary information through social networking and blogging sites.

* Employees should be warned not to post derogatory pictures and statements regarding the company and/or its employees and supervisors on websites and blogs.

* Employees should be warned about describing any activities on-line that could be considered to be accounts of harassment, hazing, or even discrimination. Such a post may be considered to be notice to the employer that off-limit activities have occurred.

* Employees should be advised to be courteous of other employees, their employer, and their employer's clients when they post on-line content.

* Supervisors should be warned about overseeing their subordinates' activities on line (James, Smith 2).

Increased Usage of Social Networking sites

According to Patrice-Anne Rutledge in “The truth about profiting from Social networking sites”, the use of Social networking sites has increased ever since. The traffic stampede to sites like MySpace, Facebook, Bebo, and YouTube continues to grow, now reaching the vast majority of Internet users of all ages and backgrounds .The numbers are compelling, as these statistics indicate:

* In January 2008, MySpace had 68.6 million unique visitors worldwide; Facebook had 33.9 million.

* Facebook visitors increased 51 percent between December 2006 and December 2007.

* Sixty-eight percent of the MySpace user base is older than 25, as is 71 percent of the Friendster user base. MySpace's largest audience segment is between 35 and 54, comprising 40 percent of total users.( Patrice-Anne Rutledge)

* Mobile social networking is predicted to rise from 50 million to 174 million users by 2011.( Patrice-Anne Rutledge)

* In December 2007, YouTube had 77.6 million viewers who watched 3.2 billion videos. Worldwide online social network ad spending is predicted to increase from $1.2 billion in 2007 to $2.2 billion in 2008. (Patrice-Anne Rutledge)

* Niche sites are growing, too. Although their niche status doesn't enable them to deliver the sheer volume of traffic that the general sites do, their growth percentages are equally impressive. Some examples include

* a, increased its market share 507 percent from January to June 2007.

* BlackPlanet was the further most popular social networking site in the U.S. in December 2007.(Anne

Sixty percent of Americans use social media, and of those, 59 percent interact with companies on social media Web sites. One in four interacts more than once per week. These are among the findings of the 2008 Cone Business in Social Media Study.
According to the survey, 93 percent of social media users believe a company should have a presence in social media, while an overwhelming 85 percent believe a company should not only be present but also interact with its consumers via social media. In fact, 56 percent of users feel both a stronger connection with and better served by companies when they can interact with them in a social media environment


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2.) The New Age of Social Networking - Issues for Employers , Caroline Dunne and Anna Sanford

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4.) Privacy in Online Social networking at workplace, Yang Wang and Alfred Kobsa

5.) Elgg Social Networking: Create and manage your own social network site using this free open-source tool, Mayank Sharma

6.) The Social Factor: Innovate, Ignite, and Win through Mass Collaboration and Social Networking, Maria Azua

7.) Legal Issues in Social Networking, Kathryn L. Ossian,Miller Canfield Paddock and Stone PLC


9.) The Truth About Profiting from Social Networking, Rutledge Anne

10.), 11.)