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Information Systems:
A Manager’s Guide to Harnessing Technology

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Chapter 12
A Manager’s Guide to The Internet and Telecommunications

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Learning Objectives

  • Describe how the technologies of the Internet combine to answer the questions: What are you looking for? Where is it? And how do we get there?
  • Interpret a URL, understand what hosts and domains are, describe how domain registration works, describe cybersquatting, and give examples of conditions that constitute a valid and invalid domain-related trademark dispute

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Learning Objectives

  • Describe certain aspects of the Internet infrastructure that are fault tolerant and supports load balancing
  • Discuss the role of hosts, domains, IP addresses, and the DNS in making the Internet work
  • Understand the layers that make up the Internet – application protocol, transmission control protocol, and internet protocol – and describe why each is important

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Learning Objectives

  • Discuss the benefits of Internet architecture in general, and TCP/IP in particular
  • Name applications that should use TCP, and others that might use UDP
  • Understand what a router does, and the role these devices play in networking

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Learning Objectives

  • Conduct a traceroute and discuss output, demonstrating how Internet interconnections work in getting messages from point to point
  • Appreciate why mastery of Internet infrastructure is critical to modern finance, and be able to discuss the risks in automated trading systems
  • Describe VoIP, and contrast circuit vs. packet switching, along with organizational benefits and limitations of each

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Learning Objectives

  • Understand the last mile problem, and be able to discuss the pros and cons of various broadband technologies including DSL, cable, fiber, and various wireless offerings
  • Describe 3G and 4G systems, listing major technologies and their backers
  • Understand the issue of net neutrality and put forth arguments supporting or criticizing the concept

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Figure 12.1 – The Internet is a network of networks, and these networks are connected together

  • The Internet is a network of millions of networks

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Figure 12.2 – Anatomy of a Web Address

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The Web Address

  • Hypertext transfer protocol (http) - application transfer protocol that allows web browsers and web servers to communicate
  • A domain name represents an organization and a host refers to public services offered by that organization
  • Host and domain names are case-insensitive
  • Path maps to folder location where file is stored on server
  • Path and filenames are case sensitive
  • Filename refers to name of file stored on server

Item Number: 101783940

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Host and Domain Names: A Bit More Complex Than That

  • A domain name represents an organization
  • Hosts are public services offered by that organization
  • Load Balancing: Distributing a computing or networking workload across multiple systems in order to avoid congestion and slow performance
  • Fault Tolerant: Systems that are capable of continuing operation even if a component fails

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I Want My Own Domain

  • One can register a domain name, paying for a renewable right to use that domain name
  • Domain name registration is handled on a first-come, first-served basis and all registrars share registration data to ensure that no two firms gain rights to the same name
  • Cybersquatting: Acquiring a domain name that refers to a firm, individual, product, or trademark, with the goal of exploiting it for financial gain

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IP Addresses and the Domain Name System

  • Every device connected to the Internet has an identifying address called the Internet Protocol (IP) address
  • The domain name service is hierarchical system of nameservers that maps host-domain name combinations to IP addresses
  • The cache is a temporary storage space that speeds up IP address mapping by avoiding nameserver visits

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Figure 12.3 – When your Computer needs to find the IP address for a host or domain name, it sends a message to a DNS resolver, which looks up the IP address starting at the root nameserver

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The Internet is Almost Full

  • Inefficient allocation of IP addresses and exploding number of Internet connected devices means that we’re running out of IP addresses
  • Shifting to a new IP scheme such as IPv6 increases the possible address space to a new theoretical limit of 2128 addresses

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TCP/IP – The Internet’s Secret Sauce

  • The Internet Protocol Suite consists of:
  • Transmission Control Protocol (TCP)
  • Internet Protocol (IP)
  • TCP works at both ends of Internet communications to ensure perfect copies of messages are sent
  • IP is a routing protocol in charge of forwarding packets on the Internet
  • Routers are computing devices that connect networks and exchange data between them

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Figure 12.4 – TCP/IP in Action

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Routers

  • Routers are special computing devices that forward packets from one location to the next
  • Routers are typically connected with more than one outbound path, so that in case one path becomes unavailable, an alternate path can be used

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UDP: TCP’s Faster, Less Reliable Sibling

  • TCP is a perfectionist and this is essential for web transmissions, e-mail, and application downloads
  • Streaming media applications like Internet voice chat and video conferencing require sacrificing of perfection for speed
  • User Datagram Protocol (UDP) works as a TCP stand-in speed is needed and quality has to be sacrificed

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VoIP

  • Old phone systems use circuit switching for a dedicated connection between two entities
  • Internet networks are packet switched and conversations are sliced into packets and squeezed into smaller spaces
  • VoIP allows voice and phone systems to become an application traveling over the Internet

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Finance has a Need for Speed

  • Electronic trading systems leverage data mining and other techniques to crunch massive volumes of data and discover exploitable market patterns
  • Models are then run against real-time data and executed the instant a trading opportunity is detected
  • Systems that run on their own can move many billions instantly, and the actions of one system may cascade, triggering actions by others

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Watching the Packet Path via Traceroute

  • Traceroute sends clusters of three packets starting at first router connected to a computer, then the next, and so on, building out paths packets take to their destination
  • Some networks block traceroute because hackers have used the tool to probe a network to figure out how to attack an organization

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What Connects the Routers and Computers?

  • Computers are connected to the Internet by:
  • Copper cable, for short distances
  • Fiber optic lines, for long distances
  • Wireless
  • TCP/IP is not dependent on transmission media
  • Most Internet communications are carried out via a combination of transmission media

Item number: 92041959

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Last Mile: Faster Speed, Broader Access

  • The Internet Backbone, made of fiber optic lines, is very fast
  • Amdahl’s law sates that a system’s speed is determined by its slowest component or the last mile
  • High-speed last mile technologies are often referred to as Broadband Internet Access
  • Various technology upgrades are happening to speed up last mile connectivity

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Cable Broadband

  • Majority of domestic broadband connections are through copper cable technology
  • Coaxial copper cables have shielding to reduce electrical interference
  • Signals travel longer distances without degrading and at significant speeds
  • Fiber/optic hybrid based networks are expensive, but offer higher speeds

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DSL – Phone Company Copper

  • DSL technology uses copper wire phone companies have already run into homes
  • Unlike cable, DSL uses standard copper wiring without shielding
  • Signals degrade with distance from phone company offices
  • DSL technology is popular in Europe and Asia owing to densely populated cities
  • DSL connections are infeasible in the U.S. where cities are sparsely populated

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Fiber – A Light-filled Glass Pipe to your Doorstep

  • FTTH or Fiber to the Home is the fastest last mile technology around
  • FTTH networks need to be built from scratch as they do not have preexisting infrastructure
  • However, FTTH can be profitable as it supports a wide range of services
  • Many ISPs like Google and Verizon have made multibillion investments in FTTH for experimental and business reasons, respectively

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Wireless

  • Mobile wireless service is provided to customers via cell towers
  • With boom in sales of smart phones, bandwidth crunch is becoming a serious concern for ISPs
  • Wireless networks are transitioning from third generation (3G) to fourth generation (4G)
  • 3G networks are slower than 4G and offer a lesser range of services

Item number: 94099985

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3G standards

  • 3G standards are divided along two camps:
  • Global System for Mobile Communications (GSM)
  • Code Division Multiple Access (CDMA)
  • The GSM standard is the most used around the world
  • CDMA is limited by its inability to support voice and data communication at the same time

Item number: 95207220

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4G standards

  • 4G standards are divided along the lines of:
  • Long Term Evolution (LTE)
  • Worldwide Interoperability for Microwave Access (WiMax)
  • DSL, cable, and fiber firms could be affected by 4G implementations
  • 4G offers them option of entering mobile phone business and offer a wider range of services
  • If speeds of 4G networks increase, more users could switch from cable, DSL, and fiber to wireless Internet access

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Satellite Wireless

  • Early satellite based telecommunications services suffered from problems such as:
  • Download-only capability
  • Required expensive and bulky equipment
  • High latency
  • O3b networks has offered to provide fiber-quality broadband access
  • O3b plans to use a network of middle earth orbit satellites to reduce latency
  • If O3b’s efforts are successful, it could transform the broadband industry

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Wi-Fi and other hotspots

  • Computer and mobile devices have Wireless Fidelity antennas built into their chipsets
  • To connect to the Internet, a device needs to be within range of a base station or hotspot
  • Cell coverage is often limited due to lack of service towers
  • Fentocells are being offered to improve wireless reception

Item number: 97889798

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Net Neutrality- What’s Fair?

  • Net neutrality is the principle that all Internet traffic should be treated equally
  • Many ISPs offer varying coverage, depending on service used and bandwidth consumed
  • Internet firms say it is vital to maintain the openness of the Internet
  • Telecommunications firms say they should be able to limit access to services that overtax their networks
  • Another concern for service providers is ever-increasing demand for greater bandwidth