OCOB Ann Rep 07-08 - Orfalea College of Business - Cal Poly San ...

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FACULTY REPORTSTracking online piracy activitiesIn order to take a closer look at the actual online my software is designed to track the top 100 bestsellingmusic files sold on Apple’s iTunes Webfile-sharing activities, I developed an automateddata collection process written in the C# language site, one of the largest online music retailers.using Microsoft’s .NET technology.Specifically, the Web agent is automaticallyThe data collection process is divided into launched daily to extract the sales ranking informationfrom iTunes’ Web page that is formattedthree different modules. The first data collectionmodule is designed to collect aggregate file-sharinginformation on file-sharing networks. This Web XML code is translated into data maintained in ain the extensible markup language (XML). Theagent collects online data that include the number Microsoft SQL Server database.of individual participants and the number of musicfiles they share, without interfering with the information from iTunes’ best-selling music filesThe final data collection module takes theactual file-sharing activities on the network and and conducts daily Boolean searches on thesewithout engaging in any illegal file-sharing activity. music files on peer-to-peer networks. The searchThe second Web agent is designed to collect result is then summarized and stored in a SQLproxy information on the sales performance of Server database file. This data collection procedureis performed without downloading anypopular music singles. Since the actual sales statisticsof music products in the U.S. are proprietary, copyrighted material.customize its product offerings to each individual customer.For example, an online retailer can enable its Web site toallow consumers to customize the content to their personalpreferences. In addition, the customization can remain onthe consumer’s personal account even when the consumerlogs on to different locations or portals (e.g., from a mobiledevice, from home, or from work). Moreover, a digital fileis usually easier to transport and archive than computerstorage media (e.g., CDs). On average, a music CD holdsabout 12 to 15 songs in a traditional file format, comparedto almost 200 songs in the MP3 format. This file compressioncapability allows consumers to carry small play-backdevices (e.g., iPods or cellular phones) that contain a largelibrary of music.Product Variety: Another critical advantage of anonline store is that a larger variety of products can be offeredto customers without the limitations inherent in physicalshelf space. Moreover, these digital contents are easierto catalog and archive. As a result, consumers can easilysearch and locate the songs they want. With this ability, anonline store can attract consumers to its site by offeringhard-to-find songs that are usually not available in a brickand-mortarstore.Based on my data analysis, some of the best sellingmusic titles on iTunes are not the titles currently on theBillboard Chart, which is based on the sales of music CDs.In fact, during a three-month data collection period, out of271 song titles that appeared on iTunes’ best selling chart,20 percent were older songs that were released more thanthree years ago. These older songs are generally hard to find(if at all available) for purchase in local music stores.Furthermore, almost 40 percent of the top selling titleswere first released at least two years ago. This means thata large number of music consumers would welcome and bewilling to pay to access a Web site that allows them to findmusic titles that may be hard to find in local music stores.These online capabilities can also be used to enhance servicesoffered in a traditional brick-and-mortar store.ConclusionThe services and features provided by online retailersare made possible by technologies similar to those that allowindividuals to pirate these same products. Based on myobservation of online file-sharing activities, increased enforcementof copyright laws has not effectively stoppedonline piracy. Enforcement of copyright laws is not only acostly way to combat the piracy problem, but can also causea backlash of feeling against the music industry. In addition,allowing consumers to purchase and use digital contentswithout excessive restrictions can be profitable even in thepresence of online file-sharing. Examples of online retailstrategies and services also suggest that the technologiesthat have been used by file-sharing networks can also beimplemented to benefit musicians and record companies aswell as to fulfill the need of customers. ■20 ❚ ANNUAL REPORT 2007-08
FACULTY REPORTSExplaining World TradeBY KATHRYN G. MARSHALLASSISTANT PROFESSOR OF ECONOMICSThe growth of global trade in the last several decades offersan exciting area of research for economists. Nocountry better illustrates the potential for trade thanChina, which is now one of the largest trading countries inthe world. Since coming to Cal Poly in 2007, my researchin collaboration with Cal Poly Professor Eric Fisher hasfocused on theoretical and empirical methods to betterunderstand the driving forces of world trade, and I have appliedthese new ideas to help explain China’s remarkabletrade growth. In this article, I will sketch the main featuresof this research and highlight some significant findings.Input Output AnalysisTo understand the pattern of international trade, onemust first look carefully at the structure of productionwithin each country. Economist Wassily Leontief pioneeredthe use of the input output table in the 1940s tomodel the intricate linkages between different industries ina modern economy. Each industry or sector in an economyproduces goods which are in turn used as intermediate inputsin the production of other products. When we measuregross domestic product (GDP), we capture only the finalstage in that complex production process. For example, inthe U.S. economy, the production of one dollar’s worth ofoutput in the automotive sector requires about $0.03 worthof products produced in the rubber and plastics sector andabout $0.05 worth of iron and steel products. In total, about$0.76 per dollar of intermediate inputs from all sectors ofthe U.S. economy goes into the production of automobiles.The remaining $0.24 per dollar of automobile productionmeasures the most important component in any productionprocess: value-added. To a business professional,value-added is better known as profits (paid to the ownersof capital) and wages (paid to workers). Economists callthese two special inputs, capital and labor, factors of production.In the automotive example, the $0.76 worth of intermediateinputs is itself produced by workers and capitalin other sectors, sectors which in turn use intermediateinputs combined with the services of workers and capitalto produce output. While this may seem like an infiniteregression, a simple mathematical technique converts thedollar value of any final product into payments to capitaland labor used directly to produce that product and indirectlyto produce all the intermediate inputs that went intothe product. For the U.S. automotive industry, when thisfull accounting is undertaken, each dollar’s worth of automobileproduction amounts to a payment of $0.31 to ownersof capital and a payment of $0.69 to workers throughoutthe economy. Labor intensive industries are defined as industrieswith a higher payment share to labor.Two different economies can be readily compared usinginput output tables. Thanks to the efforts of the Organizationof Economic Cooperation and Development(OECD), detailed and consistent input output accounts areavailable for many countries of the world. To compare theU.S. and Chinese economy, Table 1 summarizes these detailedaccounts into four major sectors – agriculture, mining,manufacturing, and services. I have also added data onemployment in each broad sector taken from the InternationalLabor Office.The most notable feature of the Chinese economy isthe huge labor force of around 721 million workers, equalto about five times the size of the U.S. labor force. But noticealso the disparity in wages across sectors. Overall, theU.S. average wage is about 19 times higher than the Chineseaverage wage. This is a clear indication that the productivityof labor is different in these two economies. U.S. workersTable 1: A Comparison of the U.S. and Chinese economies in 2000USAAgriculture Mining Manufacturing Services TotalPayments to Capital ($ billions) 71 71 496 2,985 3,624Payments to Labor ($ billions) 32 38 948 5,176 6,193Employment (millions) 3 1 20 111 135Average Wage $ 9,223 $72,204 $ 47,558 $46,505 $ 45,806ChinaAgriculture Mining Manufacturing Services TotalPayments to Capital ($ billions) 44 83 496 446 1,069Payments to Labor ($ billions) 416 59 561 737 1,773Employment (millions) 334 6 80 301 721Average Wage $ 1,248 $ 9,811 $ 6,978 $ 2,448 $ 2,459ORFALEA COLLEGE OF BUSINESS ❚ 21
Page 1 and 2: ANNUAL REPORT ❚ ACADEMIC YEAR 200
Page 3 and 4: DEAN’ S MESSAGEMaking life better
Page 5 and 6: STRATEGIC PLAN UPDATE 2008Progress
Page 7 and 8: Faculty news
Page 9 and 10: FACULTY NEWSFaculty and scholarship
Page 11 and 12: FACULTY NEWSFaculty and scholarship
Page 13 and 14: FACULTY NEWSNew faculty CONTINUEDYo
Page 15 and 16: Faculty reports
Page 17 and 18: FACULTY REPORTSof losing $100 and a
Page 19 and 20: FACULTY REPORTSCAPM-like model deve
Page 21: FACULTY REPORTSdustry can adequatel
Page 25 and 26: FACULTY REPORTSFigure 1: Measuring
Page 27 and 28: ACADEMICSAccounting program welcome
Page 29 and 30: ACADEMICStrip continued to push stu
Page 31 and 32: ACADEMICSChange of direction for th
Page 33 and 34: ACADEMICSBetter job opportunities a
Page 35 and 36: ACADEMICSThe Orfalea College of Bus
Page 37 and 38: ACADEMICSCollege celebrates achieve
Page 39 and 40: ACADEMICSOn Feb. 2, 2008, the 13th
Page 41 and 42: ACADEMICSRay Scherr Business PlanCo
Page 43 and 44: ACADEMICSCollege celebrates the stu
Page 45 and 46: his/her own decisions, we are encou
Page 47 and 48: Community
Page 49 and 50: COMMUNITYThe Cal PolyWheelchair Fou
Page 51 and 52: COMMUNITYDean’s Advisory CouncilR
Page 53 and 54: Operations
Page 55 and 56: OPERATIONSBeth Brenner joins colleg
Page 57 and 58: SUPPORT DESERVING BUSINESS STUDENTS
Page 59 and 60: Orfalea College of Business degree

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