Compare Coca-Cola and Pepsis marketing strategies

Compare Coca-Cola and Pepsis marketing strategies INTRODUCTION: Coca-cola is a soft drink. Manufactured by coca-cola company. It was introduced in 1986. Coca-Cola is a carbonated soft drink sold in stores, restaurants, and selling equipment worldwide. The Coca-Cola Company claims that the drink is sold in more than 200 countries. It is produced by The Coca-Cola Company in Atlanta, Georgia, and is often referred to simply as Coke or as cola. The Coca-Cola Company is the worlds largest drink company, refreshing customers with more than 450 fresh and still brands. Along with Coca-Cola, known as the worlds most valuable brand, the Companys collection includes 12 other billion dollar brands, including Diet Coke, Fanta, Sprite, Coca-Cola Zero, and vitamin water, PowerAde, Minute Maid and Georgia Coffee. Worldwide, we are the No. 1 supplier of fresh beverages, juices and juice drinks and ready-to-drink teas and coffees. Throughout the worlds largest beverage delivery system, customers in more than 200 countries enjoy the Companys beverages at a rate of 1.5 billion servings a day. With a permanent promise to building sustainable communities, our Company is focused on initiatives that guard the surroundings, preserve resources and improve the financial growth of the communities where we work. In the beginning proposed as a copyright medicine when it was made-up in the late 19th century by John Pemberton, Coca-Cola was bought out by businessman As a Griggs Candler, whose marketing plans lead Coke to its authority of the world soft-drink market throughout the 20th century. The concern produces focus, which is then sold to certified Coca-Cola bottlers all the way through the world. The bottlers, who hold territorially private contracts with the company, manufacture complete product in cans and bottles from the deliberate in arrangement with filtered water and sweeteners. The bottlers then sell issue and produce Coca-Cola to put up for sale stores and trade equipment. Such bottlers include Coca-Cola Enterprises, which is the main on its own Coca-Cola bottler in North America and Western Europe. The Coca-Cola Company also sells concentrate for soda fountains to major restaurants and food service distributors. BRANDS: The Coca-Cola Company has time tointroduce other cola drinks under the Coke brand name. The most regular of these is Diet Coke, with others as well as Caffeine-Free Coca-Cola, Diet Coke Caffeine-Free, Coca-Cola Cherry, Coca-Cola Zero, Coca-Cola Vanilla, and special editions with lemon, lime or coffee. In answer to buyer insistence on a more natural product, the company is in the process of phasing out E211, or sodium benzoate, the contentious additive used in Diet Coke and linked to DNA damage in yeast cells and hyperactivity in children. The company has known that it plans to take away E211 from its other products, including Sprite and Oasis, as soon as a reasonable substitute is found. On April 23, 1985, Coca-Cola, among to a large extent advertising, attempted to change the formula of the drink with New Coke. Follow-up flavour test exposed that most customers chosen the taste of New Coke to both Coke and Pepsi, but Coca-Cola management was not ready for the publics homesickness for the old drink, primary to a reaction. The company gave in to protests and returned to a difference of the old method, with high-fructose replacing cane sugar, under the name Coca-Cola model on July 10, 1985.On February 7, 2005, the Coca-Cola Company announced that in the moment sector of 2005 they designed to begin a Diet Coke product sweet with the artificial sweetener sucralose, the same sweetener at present used in Pepsi one. On March 21, 2005, it announced one more diet product, Coca-Cola Zero, sweetened in part through a blend of aspartame and aciculae potassium. In 2007, Coca-Cola began to sell a new healthy soda. Diet Coke with vitamins B6, B12, magnesium, niacin, and zinc, marketed as Diet Coke Plus. On July 5, 2005, it was exposed that Coca-Cola would start again operations in Iraq for the first time since the Arab group boycotted the company in 1968. In April 2007, in Canada, the name Coca-Cola Classic was changed back to Coca-Cola. The word Classic was removed because New Coke was no longer in making, eliminating the need to distinguish between the two. The method remained unmovable. In January 2009, Coca-Cola stopped printing the word Classic on the labels of quantity bottles sold in parts of the south eastern United States. The change is part of a big plan to refresh the products figure. In November 2009, due to a argument above wholesale prices of Coca-Cola products, Costco stopped restocking its shelve with Coke and Diet Coke. Production: Ingredients of coca-cola are Carbonated water, Sugar, Caffeine, Phosphoric acid v. Caramel, Natural flavourings. A can of Coke has 39 grams of carbohydrates, 50mg of sodium, 0 grams fat, 0 grams potassium, and 140 calories. The correct procedure of Coca-Colas normal flavourings is a well-known operate top secret. The new copy of the procedure is said in SunTrust Banks key cellar in Atlanta. Its forerunner, the dependence concern, was the underwriter for the Coca-Cola Companys initial public offering in 1919. An admired legend states that only two executives have right of use to the method, with each management have only half the principle. The truth is that while Coca-Cola does have a rule restricting contact to only two executives, each knows the whole formula and others, in adding to the agreed set of two, have known the formulation method. Coca-cola cherry available only in Canada starting in 1996. Coca-cola with lemon available in many countries like as, Brazil, Germany, Hong Kon g, United kingdom, United states etc. Coca-cola vanilla these drink we can get in Australia, New Zeeland, Malaysia etc. The famous Coca-Cola symbol was shaped by John Pembertons bookkeeper, Frank Mason Robinson, in 1885. Robinson came up with the name and chose the logos typical cursive handwriting. The font used, identified as Spenserian script, was developed in the middle 19th century and was the main shape of proper writing in the United States throughout that time. The regularly famous Coca-Cola bottle, called the contour bottle inside the concern, but known to some as the shuffle kilt bottle, was created in 1915 by bottle designer Earl R. Dean. In 1915, the Coca-Cola Company launched an opposition between its bottle suppliers to make a new bottle for the drink that would differentiate it from other drink bottles. In 1997, Coca-Cola also introduced a contour can, like in figure to its famous bottle, on a small number of test markets, as well as Terre Haute, Indiana the new can has never been generally released. Coca-Cola is a registered brand name in most countries. The U.S. brand for Coca-Cola was first filed on May 14, 1892 with the picture nutrient or boost beverages. This filing became a registered United States trademark on January 31, 1893 and continues to be changed through the end of December 2009. In the UK, Coca-Cola was registered with the UK rights Office on July 11, 1922, under registration number 427817. In 2007, Coca-Cola introduced an aluminium can considered to look like the original glass Coca-Cola bottles. In 2007, the companys symbol on cans and bottles changed. The cans and bottles taken the red colour and common letters, but the plans were cut down, leaving only the sign and a simple white spin. In 2008, in a number of parts of the world, the plastic bottles for all Coke varieties was changed to take in a new plastic coil ceiling and a contoured bottle figure planned to suggest the old glass bottles. The Coca-Cola Corporation purchased Columbia movies in 1982, and began inserting Coke-product descriptions in a lot of its films. After a small number of early successes for the period of Coca-Colas ownership, Columbia began to under-perform, and the studio was sold to Sony in 1989. Coca-Cola has left through a number of different publicity slogans in its lengthy hist ory, as well as the break that refreshes. REWARDS: In 2006, Coca-Cola introduced My Coke Rewards, a buyer faithfulness movement where customers receive points by entering codes from specially-marked letters of Coca-Cola goods into a website. These points can be redeemed for a variety of prizes. Coca-Cola was the first industrial sponsor of the Olympic games, at the 1928 games in Amsterdam, and has been an Olympics supporter still since.The Coca-Cola Company has been an Olympic partner since 1928 almost 80 years and is the best continuous commercial follower of the Olympic Movement. The Company works with National Olympic Committees in more than 200 countries to help athletes train and fight. More than 90 percent of the Coca-Cola systems investment in the Olympic Games is focussed to athlete development and to help in production the Games. Products of The Coca-Cola Company refresh athletes, volunteers, officials and audience during the Olympic Games and supporting programs such as the Beijing 2008 Olympic Torch Relay allows Coca-Cola to help share the Olympic courage around the world. The Coca-Cola Company is the special non-alcoholic beverage partner to the Olympic Games through 2020. This company funding included the 1996 Summer Olympics hosted in Atlanta, which allowed Coca-Cola to focus its homeland. Since 1978, Coca-Cola has sponsored each FIFA World Cup, and other competition controlled by FIFA. In fact, one FIFA tournament award, the FIFA World Youth Championship from Tunisia in 1977 to Malaysia in 1997, was called FIFA Coca-Cola Cup. In adding together, Coca-Cola sponsors the annual Coca-Cola 600 and Coke Zero 400 for the NASCAR Sprint Cup Series at Charlotte Motor Speedway in Concord, North Carolina and Daytona International Speedway in Daytona, Florida. Coca-Cola has a long history of sports advertising dealings, which over the years have built-in Major League Baseball, the National Football League, National Basketball Association and the National Hockey League, as well as with many teams within those leagues. Coca-Cola is the certified soft drink of many collegiate football teams throughout the country. Coca-Cola was one of the representative sponsors of the 1996 Cricket World Cup assumed on the Indian subcontinent. Coca Cola is also one of the link sponsors of Delhi Daredevils in Indian Premier League. In England, Coca-Cola is the chief sponsor of The Football League, a name given to the three qualified divisions below the Premier League in football. It is also responsible for the renaming of these divisions until the beginning of Coca-Cola sponsorship; they were referred to as Divisions One, Two and Three. Since 2004, the divisions have been known as the challenge League One and League 2. This renaming has caused conflict amongst some fans, which see it as hopeless that the third level of English Football is now called League One. In 2005, Coca-Cola launched a competition for the 72 clubs of the football league, it was called Win a Player. These approved fans to leave 1 take part in an election per day for their favourite club, with 1 admission being chosen at chance earning  £250,000 for the club, this was continual in 2006. The Win a Player competition was very contentious, as at the end of the 2 competitions, Leeds United AFC had the most votes by more than twice, yet they did not win any money to spend on a new player for the club. In 2007, the competition changed to buy a Player. This competition allowed fans to buy a bottle of Coca-Cola Zero or Coca-Cola and accept the code on the covering on the Coca-Cola website. This code could then receive anything from 50p to  £100,000 for a club of their selection. This competition was favoured over the old Win a Player competition, as it approved all clubs to win some money. In India, there is a main argument whether there are pesticide and other dangerous che micals in bottled goods, as well as Coca-Cola. In 2003 the Centre for Science and Environment, a non-governmental organization in New Delhi, said fizzy waters shaped by soft drinks manufacturers in India, including international giants PepsiCo and Coca-Cola, controlled toxin together with Lindale, marathon and chlorpyrifos pesticides that can give to growth and a fail of the immune system. CSE found that the Indian produced Pepsis soft drink products had 36 times the level of pesticide residues allowed under European Union system; Coca-Colas soft drink was found to have 30 times the legal amount. CSE said it had tested the same products sold in the U.S. and found no such residue. After the creature repellent allegation were made in 2003, Coca-Cola sales in India declined by 15 percent. In 2004 an Indian governmental commission backed up CIEs result and a government-appointed group was tasked with early the worlds first pesticide principles for soft drinks. The Coca-Cola concern has responded that its plants filter water to remove possible contaminants and that its products are tested for pesticides and must meet minimum health values before they are spread. In the Indian state of Kerala sale and production of Coca-Cola, along with other soft drinks, was firstly banned after the allegation, until the High Square in Kerala overturned ruled that only the central government can ban food products. Coca-Cola has also been accused of too much water handling in India. The Coca-Cola system in Australia introduced Coca-Cola Zero on Australia Day, January 26. As the first market outside North America to launch Coca-Cola Zero, Australia is attractive a significantly different approach. In Australia, Coca-Cola Zero encourages people to free themselves from limits. Instead of Chill Out, the note to consumers is Unlimited Yourself. A single Australian formulation was developed, and even the covering was developed particularly for Aussie consumers. The Coca-Cola drink has a high degree of classification with the United States, being measured by some an American Brand or as a thing indicating America. The classification with the increase of American society has led to the pun Coca-Colonization. The drink is also often a metonym for the Coca-Cola concern. There are some customer boycotts of Coca-Cola in Arab countries due to Cokes early investment in Israel throughout the Arab League boycott of Israel. Mecca Cola and Pepsi have been doing well alternatives in the centre east. Coca-Cola is the most popular and biggest-selling soft drink in history, as well as the best-known product in the world. Coca-Cola has been at the front position of libelling initiatives for nearly 20 years, most important the way in adding per-package diet information on labels, in addition to the per-serving information that is compulsory by rule. Last year, the concern began as well as caffeine-content information on the labels of products with added caffeine. The new front-of-package libelling includes information that was always to be found in the food proof panel of Coca-Cola goods, but it is now easier for customers to see this important information at a glance. In the next months, Coca-Cola goods throughout the European Union will start transport expanded food information on packaging to help consumers make educated option. The Coca-Cola Company in the European Union has committed to the chosen, practical changes, which the European food and drink production group CIAA announced this week to regulate the food information available on food and drink packaging in Europe. In addition, the British Soft Drinks company announced that the drink manufacturing in Great Britain would be adopting a GDA food system regular with the CIAA plan, indicating the first convenient performance of the new labels to a whole division in a European Union country. Within the next 24 months, all Coca-Cola goods sold in the European Union Group will have a force symbol on the front of the packs stating the calories per serving in the product and the percent those calories stand for of the total optional daily drinking, or Guideline Daily Amount. The backs of the parcels will contain expanded information displaying the GDAs for sugar, fat, soaked fat, salt and calories, when applicable. That will be in adding to a Big 8 nutrient table on the pack stating the energy value, protein, carbohydrate, sugar, fat, saturated fat, fibber and sodium content. Our Company is committed to contribution customers all the information they need to make up to date choices, in order to meet thei r diet and lifestyle needs. This idea recognizes peoples desire for more regular, helpful and easy-to-understand information, and we will take action upon it with genuine achievement in the open market. SOCIAL NETWORKING: COCA-COLA has developed a highly successful social networking strategy over the past two years. The company currently owns the second most popular page on Facebook with 3,261,218 members, and has a strong presence on other social sites, as well as its own corporate blog. Michael Donnelly, the companys global interactive marketing director, said at the Social Networking World Forum in London this week that the success of the strategy was the result of breaking from traditional marketing strategies and letting customers lead the way. So we let consumers drive the strategy, which we then embrace, he explained. ADVERTISEMENT: At first the idea of using social networks for marketing purposes had made Coca-Cola a little uncomfortable, as traditional marketing had always worked well for the company. Donnelly cited the 1.5 billion servings of Coke sold every day as evidence. An additional obstacle had been the global combination necessary for a social media strategy. Donnelly explained that his role had been to scale the learning from all around the world. We had brilliant marketers all over the world but they were decentralised in each country and, while they each had a social network, they were not sharing their experiences, he said. The deployment of the social media strategy began in late 2007 with the launch of Coca-Cola conversations , the first of the companys corporate blogs, which discusses Coca-Colas role in popular culture, its brand history and collectables. Coca-Cola infiltrated the virtual world space in the same year by launching a competition for residents of Second Life called Virtual Thirst to design a vending machine that dispensed the essence of Coca-Cola rather than the drink itself. Digital Marketing: Strategy: Strategic planning is so essential to ensure the successful delivery of a project, that we take every design, website, email, banner, CMS and database through the same scoping, research and strategy definition process. At the project outset we work with our clients to build a deep understanding of their brand. Stakeholder interviews highlight the key business objectives, and user research ensures our customers customer is at the heart of any decision making. Only when we fully take hold of all of this, do we devise the most effective strategy, giving you confidence in our delivery, and maximum return on investment. We spend time defining goals and understanding your brand, asking users how theyd like your website to work, scoping the project and setting the strategy. We then present our project specification which provides an perfect representation of the project. Then we deliver the goods, in-line with your expectations, which is why were enjoying so many long-term relationships with our clients. Online marketing: For many years weve helped major clients with their online advertising, right through from concept to completion. We can take care of media buying and develop exciting and effective strategies. We can design exciting, believable creative and promote your brand via search engines. Well even undertake a full analysis of the campaign, and work out how we can go one better next time round. CONCLUSION: In a competitive market, both companies(coke and pepsi) must identify and target different market segments in order to remain at the cutting edge. Differences between the companies are evident with respect to product, pricing, place and promotion. Coca-cola relies heavily on value: quality is more than something we see or taste. Pepsi, on the other hand, relies on its success resulting from superior products and high standards of performance. An effective marketing program brings together all of the elements of the marketing mix to achieve the organisations marketing objectives by delivering to customers what they want and need. Thus, the most successful companies will be those that can meet these needs most effective.

Stock and Long Term Trend

Team 1 Monmouth Case 1. Is Robertson a good candidate for Monmouth (assuming the price is right)? Why? Yes. Robertson Tool Company had been going through a few years of low sales and profit, and, coupled with conservative financial and accounting practices, was far behind the normal growth rate for companies in its industry. Robertson’s 50% control of the market for clamps and vises, along with its good position in the scissors and shears’ $200 million market, let it compliment the diverse holdings of Monmouth.These are attractive attributes of Robertson, but the selling point lies in the distribution network consisting of 2,100 wholesalers and 15,000 retail outlets. The Robertson products are sold in 137 countries worldwide. This avenue to market Monmouth and Robertson products across resources could lead to above average growth and profits. 2. Estimate a WACC for the acquisition. Invested Capital| ? | $37,696,000 | ? | ? | ? | Debt| | $12,000,000 | | | ? | Equity| | $ 25,696,000 | | | ? | ?| | | | | ? | Current market price| | $44 | | | ? |Shares outstanding| | 584,000| | | ? | ?| | | | | ? | Unlevered Beat of Comparables| | 0. 725| | | ? | Debt/Capital of Comparables| | 32%| | | ? | Levered Beta| | 0. 86| | | ? | Risk free rate| | 4. 10%| | | ? | MRP| | 6. 0%| | | ? | ?| | | | | ? | Cost of equity| | 9. 28%| | | ? | ?| | | | | ? | Sources of capital| | | Weights| | After-tax cost| Debt| | | 31. 83%| | 3. 64%| Equity| | | 68. 17%| | 9. 28%| ?| | | | | ? | YTM| 6. 070%| Tax Rate| 40%| WACC| 7. 5%| 3. Discuss whether you think the forecast prepared by Vincent and Rudd is reasonable. Why? Be specific.We think the forecast is not reasonable since they forecast was too optimistic and subject of their sales growth. a) The growth rate estimate in the future they use is approximately 6%. The current growth rate is just 2% that cannot be increased as 2 times as large in a short time, although it might increase due to the sales increase after the merge and acquisition of the Monmouth and Robertson. b) NWC should be as a percentage of sales. c) Terminal Growth rate shouldn’t be zero but around 2%. d) The estimations of SG&A cost and COGS are reasonable.The merger and acquisition will result the percentage SG&A and COGS of sales respectively gradually decrease by increasing the manufacture efficiency and inventory turnover. Therefore, we decided to change the growth rate from 6% to 3% in the pro-forma, we will have the value of the firm calculated out from the pro-forma is $50 million instead of $56 million. 4. Prepare a value estimate for Robertson equity using the DCF method and info from steps 2 and 3 above. ?| Actual| Forecasts| ?| 2002| 2003| 2004| 2005| 2006| 2007| ?| | | | | | ? | NOPAT| 1. 8| 2. 4| 3. 1| 3. 8| 4. 2| 4. 4|Plus: Depreciation| 2. 1| 2. 3| 2. 5| 2. 7| 2. 9| 2. 9| Less: CAPEX| | -4| -3. 5| -3. 6| -3. 8| -2. 9| Less: Change in NWC| -1. 4| -1. 5| -1. 6| -1. 6| 0. 0| Firm Free Cash Flow| -0. 7| 0. 6| 1. 3| 1. 7| 4. 4| ?| | | | | | ? | ?| | | | | | 81. 9| Firm Value (millions)| 85. 95| | | | Terminal g| 2%| Less: Debt| 12| | | | | ? | Equity Value| 73. 95| | | | | ? | Shares Outstanding| 584000| | | | | ? | Price per share| 12. 66| ? | ? | ? | ? | ? | 5. Estimate a value for Robertson equity based on the comparables approach. | Actuant Corp. | Briggs & Stratton| Idex Corp. | Lincoln Electric| Snap On Inc. Stanley Works| Robertson Tool Co. |   | | | | | | |   | Collection Period (days)| 55| 77| 47| 61| 96| 77| 53| Inventory % Sales| 12%| 18%| 13%| 17%| 18%| 16%| 33%|   | | | | | | |   | Operating Margin % Sales| 17%| 13%| 20%| 15%| 10%| 15%| 5%| Return on Capital| 21%| 9%| 10%| 12%| 11%| 14%| 4%|   | | | | | | |   | Times Interest Earned| 3. 8| 3. 2| 7. 1| 11. 5| 7. 8| 9. 3| 3. 5| Debt % Capital| | | | | | |   | ?  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   balance sheet values| 98%| 52%| 30%| 27%| 29%| 40%| 28%| ? market values| 29%| 37%| 20%| 17%| 19%| 24%| 37%| Bond Rating| BB-| BB+| BB B| -| A+| A| -| | | | | | | |   |Value of Firm ($ mil)| $ 712| $ 1,443| $ 1,191| $ 1,145| $ 1,861| $ 3,014| $ 29| EBIAT ($ mil)| 55| 119| 98| 90| 129| 234| 1. 80| EBIAT Multiple| 12. 8| 12. 1| 12. 2| 12. 7| 14. 4| 12. 9| 16. 1|   | | | | | | |   | Share Price| $ 42| $ 42| $ 29| $ 22| $ 26| $ 27| $ 30| Earnings Per Share| 2. 80| 3. 20| 2. 00| 1. 78| 1. 80| 2. 32| 2. 32| Price/Earnings| 15. 0| 13. 1| 14. 5| 12. 4| 14. 4| 11. 6| 13. 5| Average p/e multiple is 13. 5 Use the p/e multiple to multiply Robertson’s earning per share=13. 5*2. 32=31. 32 Now Robertson issued 584,000 shares So the equity value is 18,290,880 6.What price will be necessary to gain the support of the Robertson family, Simmons, and the majority of shareholders? What are the interests, concerns, alternatives for each group? . | Robertson| Simmons| Majority of SHs| Price| $32. 82| $50| $30| Interest| Distribution system| Interested in electrical equipment, tools, nonferrous metals, and rubber products| To improve the EPS of Monmouth in the next five years. | Concerns| A relatively poor sales and profit performance| NDP Stock price fluctuates| Poor company Performance Relative to the Industtry| Alternatives| NDP, Simmons, Monmouth| 133000 shares| NDP vs Monmouth| . Does Monwouth have an advantage over NDP in the bidding contest? Do you think NDP will raise its offer in response to Monmouth offer? The synergies created by a merger between Monmouth and Robertson are clearly greater than that of NDP. As a publisher and manufacturer of auto parts, the benefits would not be as many as that of Monmouth. NDP must consider how much it is willing to spend or borrow in order to make a bid greater than Monmouth. If Simmons receives his $50/share, he will be accepting of the merger, and support Monmouth.This will turn the favor to Monmouth, as an acquisition by NDP would surely devalue the resources of Robertson instead of using synergies created by mixing markets and offering new, complimenting , product lines. In fact, as Robertson is undervalued in the market because of unsystematic latencies and inefficiencies, the $50/share price demanded by Simmons might be less than the long-term gain inherent in the merger of Robertson and Monmouth. 8. What price can Monmouth pay without harming its long term trend in earnings per share ? Finance texts focus on net present value of cash flow to make investment decisions.Are companies therefore foolish if they make acquisitions based at least in part on earnings per share impact? First, we need to forecast Robertson’s net income if it is acquired by Monmouth, assuming its interest expenses will be $0. 8 million for the next five years. Second, we will forecast Monmouth’s total net income after acquisition of Robertson. Monmouth must raise funds to make this acquisition. The company anticipated making the acquisition by issuing stocks. Thus, we will calculate how many shares Monmouth should issue without harming its long term trend in earnings per share, and total shares outstanding after acquisition.We know that currently stocks of Monmouth and Robertson closed at $24 and $44, respectively; therefore, we can calculate the exchange ratio as $44/$24=1. 83x. If Monmouth acquired the entire Robertson by an exchange of stocks at a price of $44 per share, the shares that Monmouth needs to issue is 1. 07 (1. 83*0. 584) million. As a result, Monmouth’s total shares outstanding after acquisition would increase to 5. 28 (4. 21+1. 07) million. Now we know the total net income and total shares outstanding after acquisition, we can then calculate the after-merge earnings per share of Monmouth.According to the table below, the row in green shows that the after-merge EPS is lower than the before-merge EPS during the first two years, but will become higher in the following three years. Therefore, if we paid $44 per share for Robertson’s stocks, we can acquire the entire Robertson’s stocks wit hout harming Monmouth’s long term trend in earnings per share. Using the same techniques, we can estimate the price range that Monmouth can pay without harming its long term trend in earnings per share.We can use the Goal Seek function in Excel to estimate the highest exchange ratio. As you will see in the table below, the exchange ratio can increase up to 1. 98x without harming Monmouth’s long term trend in earnings per share. Therefore, using the exchange ratio of 1. 98x, we can estimate the per share price paid for Robertson’s stocks. The estimated price would be $47. 52 (1. 98*24) per share, higher than Robertson’s current trading price of $44, therefore will attract the shareholders of Robertson’s to sell; but still on’t harm Monmouth’s long term trend in earnings per share. However, EPS plays very little role in deciding whether an acquisition is good or not, since a company’s net income after acquisition and total shares outstanding can be affected by many factors. Acquisition will bring synergies to the acquiring company, such as cost savings and efficiency. Also, the acquiring company may not need to buy the entire target company’s outstanding stocks to gain control. As a result, EPS could also change due to these factors. Thus, NPV is a better alternative to value an investment.

To Kill a Mockingbird and Harry Potter Comparasin

Racism and Social Inequality: Text to Text Comparison To Kill a Mockingbird is a novel written in 1960 by Harper Lee. The novel addresses the issue of racism and inequalities in the social structure in the American south during the Great Depression. The novel’s main protagonist is Jean Louise Finch, also known as Scout. Scout’s father, Atticus Finch, is a lawyer and in the novel, he defends a black man accused of raping a white woman. The novel focuses on the racial issues that form around this case. Another, much different, literary work that also deals with similar issues of inequality is the Harry Potter series. The Harry Potter series, written by J.K Rowling, focuses on the inequalities in a fictional world of wizards. Similar†¦show more content†¦However, we learn during the hearing that this is highly unlikely. â€Å"his left arm was fully twelve inches shorter than his right, and hung dead at his side† (Lee, 186). As we can see from this quote, Tom Robinson is crippled and he has no use of his left arm, and as Mayella Ewell was beaten mainly on the right side, it is unlikely that the culprit was Tom Robinson. However, despite the lack of substantial evidence, Tom Robinson is accused of raping Mayella Ewell. It is later assumed in the book that Mayella Ewell herself attempted to molest Tom Robinson, â€Å"She tempted a Negro† (Lee, 203). Just as Tom Robinson pays for Mayella lustful feelings, a character in the Harry Potter series is targeted for being loved by Merope Gaunt. Merope Gaunt comes from a family very similar to the Ewells; the Gaunts are dirt poor and uneducated. However, like the Ewells they hold themselves in high esteem. The Ewells are proud to be white and the Gaunts are proud to be purebloods and related to Salazar Slytherin, an important historical figure of the wizarding world. Like Mayella, Merope is terrorized by her father and forced to keep house for him. Also like Mayella, who a ttempts to remain presentable, Merope appears to be cleaner than her brother or father. Merope also attempts to gain the attention of a man her father and brother consider scum. Merope loves a muggle man from the nearby village named Tom Riddle.

Joseph Winters and the Fire Escape Ladder

On May 7, 1878, the fire escape ladder was patented by Joseph Winters. Joseph Winters invented a wagon-mounted fire escape ladder for the city of Chambersburg, Pennsylvania. A historic marker was placed in 2005 at the Junior Hose and Truck Company #2 in Chambersburg, Pennsylvania noting Winters patents for the fire escape ladder and hose conductor and his work on the Underground Railway. It lists his dates of birth and death as 1816-1916. Life of Joseph Winters There are at least three different, widely varying birth years given for Joseph Winters, from 1816 to 1830 by various sources. His mother was Shawnee and his father, James, was a black brickmaker who worked at Harpers Ferry to build the federal gun factory and arsenal. The familys tradition said that his father was also descended Powhatan chief  Opechancanough. Joseph was raised by his grandmother Betsy Cross in Waterford, Virginia, where she was known as the Indian Doctor woman, a herbalist and healer. His later knowledge of nature may have stemmed from this time. At that time there were free black families in the area and Quakers who were active abolitionists. Winters used the nickname Indian Dick in his publications. Joseph also later worked at Harpers Ferry sanding brick molds before the family moved to Chambersburg, Pennsylvania. In Chambersburg, he was active in the Underground Railroad, helping enslaved people escape to freedom. In Winters  autobiography, he claimed to have arranged the meeting between Frederick Douglass and abolitionist John Brown at the quarry in Chambersburg before the historic Harpers Ferry raid. Douglasss autobiography credits a different person, local barber Henry Watson. Winters wrote a song, Ten Days After the Battle of Gettysburg, and also used that as the title for his lost autobiography. He also wrote a campaign song for presidential candidate William Jennings Bryan, who lost to William McKinley. He was noted for hunting, fishing, and fly-tying. He engaged in oil prospecting in the Chambersburg area but his wells only hit the water. He died in 1916 and is buried in Mount Lebanon Cemetery in Chambersburg. Fire Ladder Inventions of Joseph Winters Buildings were being built taller and taller in American cities in the late 19th century. Fire crews at that time carried ladders on their horse-drawn fire engines. These were usually normal ladders, and they couldnt be too long or the engine wouldnt be able to turn corners into narrow streets or alleys. These ladders were used to evacuate residents from burning buildings as well as to give the firemen and their hoses access. Winters thought it would be smarter to have the ladder mounted on the fire engine and be articulated so it could be raised up from the wagon itself. He made this folding design for the city of Chambersburg and received a patent for it. He later patented improvements to this design. In 1882 he patented a fire escape that could be attached to buildings. He reportedly received much praise but little money for his inventions. Fire Ladder Patents US patent #203,517 Improvement in fire-escape ladders, granted on May 7, 1878.US patent #214,224 Improvement in fire-escape ladders, granted on April 8, 1879.US patent #258186 Fire escape, granted on May 16, 1882.

Marriage Is A Union By Ann Walker - 1182 Words

Marriage is a union many Americans hope to enter in their life. While some marriages last a lifetime, some sadly end in divorce. I got the honor to interview a lovely couple who have been married twenty-five years and are still standing strong today. Ann walker age fifty and Nelson walker age 56 are two African American Macon residents who say they found love at first sight. At age twenty-one Ann meet Nelson in a downtown club called Grant’s Lounge in Macon and from there it was history. Four years later they got married on August 14th, 1991. The walker family consists of four boys and two girls. Ann and nelson had two boys together while married. The rest of the children came from previous relationships of both parents; one son from Ann and two sons and two daughters from Nelson. Ranging from age: The walker’s are a middle class family and now live together with just two of their sons now. Their marriage consist of an income-pooling marriage, they share all their exp enses and take care of all the bills together. You could say that they never have time apart, they are always together. Neither Ann nor Nelson work. Ann gets social security while Nelson gets unemployment because he got hurt on a job at an early age. When it comes to their parenting style of how they raised the kids Neither parent whoops the youngest child, they say they don’t believe in giving whippings but I guess that now only applies to the youngest child because they did indeed whoop the other kids. IShow MoreRelatedScott Walker Controversial 2011 Budget Proposal Eliminate Most Collective Rights For Wisconsin State Employees1240 Words   |  5 Pages Abstract Scott Walker controversial 2011 budget proposal eliminate most collective rights for Wisconsin state employees. He is the first governor to win a recall election. Scott walker was reelected the seat of Wisconsin State Assembly. 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What can David do about his position in relation to the other partners Free Essays

Introduction In considering what rights David has in respect of the other partners, it will first need to be determined whether a partnership has actually been created. For a partnership to be created two or more persons must conduct business with a view to profit. Partnerships are defined under s. We will write a custom essay sample on What can David do about his position in relation to the other partners? or any similar topic only for you Order Now 1(1) Partnership Act (PA) 1890 as a â€Å"relation subsisting between persons carrying on business in common with a view of profit†. Since David, Clive and Jane have all started a business in advertising with a view to profit; it is evident that a partnership has been created. As a partnership agreement has not been created by the partners, the partnership will be governed by the PA 1890. David will thus be able to rely on the PA 1890 in order to establish his rights and duties. It is contained within s. 19 PA 1890 that â€Å"the mutual rights and duties of partners whether ascertained by agreement or defined by this Act may be varied by the consent of all of the partners, and such consent may be either express or inferred from a course of dealing†.[1] Therefore, the rights and duties of David will have been capable of being varied with the mutual consent of all the partners. As the partners do not have a partnership agreement in place, it is clear that they have not v aried the terms of their rights and duties that are contained under the Act. Given that a partnership is based upon the mutual trust of all the partners, they each owe a duty of good faith. This has been exemplified in the case of Const v Harris[2] when it was held by Lord Eldon that; â€Å"in all partnerships, whether it is expressed in the deed or not, the partners are bound to be true and faithful to each other†. Therefore, each partner must be required to act in the interests of the partnership as a whole and not in the interests of themselves. As Jane is a director of a company that runs corporate events, called Eventbright Ltd, which has been regularly used by the partners, it is questionable whether Jane is acting in the interests of the partnership. This is because Jane may only be using Eventbright Ltd in order to increase profits in her own company. This can be seen in Trimble v Goldberg[3] where it was made clear that all partners must act in good faith for the benefit of the partnership. There are three requirements that must be fulfilled by the partners when acting in good faith of the partnership. These are; 1) the duty to disclose information, 2) the duty to account for benefits received, and 3) the duty in respect of competing business.[4] Whether the latter two duties are being fulfilled by Jane is debatable. This is because Jane may be benefiting from using her company to which she is a director in order to gain profits (s. 29 PA 1890) and her company may be considered a competing business (s. 30 PA 1890). If this is the case, Jane will be required to disclose this information to the other partners and must account for and pay over to the firm all profits made by her. In respect of the restrictions Jane and Clive want to impose upon David’s work, it is likely that David will be able to assert his rights contained under s. 24 PA 1890. Here, it provided that; every partner may take part in the business (24(5)) and that decisions are to be taken by a majority but unanimity is required to change the nature of the business (24(8)). David may therefore take part in the business, yet because Jane and Clive have suggested he take a more administrative role, it is arguable whether this will be sufficient. This is because Clive and Jane will be capable of making a majority decision as to how the business is being run, although they cannot change the nature o f the business without David’s consent. In effect, David may not be able to oppose the decision that is being made by Clive and Jane as they will be able to take a majority vote as to how they think the business should be run. And, if they feel that it is in the best interests of the business, then David may not have any right to argue against this unless they acted in bad faith or attempted to change the nature of the business. If David is not happy with the new arrangements, he may be capable of bringing the partnership to an end. This can be done by giving notice to the other partners (s. 26 and 32 PA 1890). If David decides to bring the partnership to an end, any partner will have the right to publicly notify the dissolution (s. 37 PA 1890). After the partnership has been dissolved, each partner will be entitled to have the partnership property applied so that the debts and liabilities can be discharged. Once this has been done, any surplus will be distributed equally between the partners. Because not all property is partnership property, a distinction will have to be made between personal and partnership property as personal property will not be able to help meet partnership debts (s. 20 PA 1890). Overall, it seems as though David may not be able to oppose the decision of Clive and Jane to restrict his work to more clerical and administrative matters. If David is not happy with this decision he may be able to bring the partnership to an end by giving notice to the partners. Once this has been done, the partnership property will be distributed equally between all three partners. What is the partnership propertyWhy does it matter? The amount of money and property the partners have contributed to the partnership to use in the enterprise is known as partnership capital.[5] This represents the partner’s equity in the partnership and has noted in Reed v Young[6]; â€Å"The capital of a partnership is the aggregate of the contributions made by the partners. It is important to distinguish between the capital of a partnership, a fixed sum, on the one hand and its assets, which may vary from day to day and include everything belonging to the firm having any money value, on the other.† Partnership capital is thereby distinguished from partnership property which is the property that has been acquired by the partnership. This includes a transfer of property to; a) the partnership in its name, b) one of the partners in their capacity as partnership, or c) one of the partners indicating their capacity as a partner.[7] It is vital that partners indicate their intent as to whether the property is to be consider ed capital or property as this will determine who is entitled to the property once the partnership is dissolved. If the property is partnership capital, then the individuals will be entitled to take their share of the property.[8] If the property is partnership property, then the property will be distributed equally between the partners. As pointed out by Lord Andrews LCJ in McClelland v Hyde[9]; â€Å"the capital of a partnership is something different from its property or its assets†. 20(1) PA 1890 states that partnership property includes â€Å"property originally brought into the partnership stock or acquired for the purposes and in the course of the partnership business†. It is important for partners to specify what property belongs to whom in order to avoid any undesirable consequences. The original owners of the property may not be entitled to recover the property in the event that the partnership comes to an end.[10] On the insolvency or bankruptcy of a partnership, there are two sets of creditors; joint and separate. The partnerships assets are referred to as the â€Å"joint estate† in the Insolvency Act 1986 (as amended by the Insolvent Partnerships Order 1994 (SI 1994 2421)) and are used in the first instance to pay the partnerships creditors. If an asset increases in value, the increase will belong to the firm if the asset is partnership property. If the asset is owned by the individual partner, then the increase will belong to the individu al.[11] As a partnership does not have its own separate legal entity, partnerships cannot own property in its own name. Instead, partnership property will be held in the names of the individual partners who will be deemed to be holding the property in their names as agents for the purposes of, and as trustees for, the partnership as shown in Burdick v Garrick[12] where property held on trust for the partners was considered partnership property. There is also a presumption, unless expressly stated otherwise, that partnership property is held by partners as tenants’ in common and not as joint tenants (except for land; s. 39(4) Law of Property Act 1925). This was evidenced in Bathhurst v Scarborough[14] when it was noted that the general rule is that property bought with partnership money belongs to the partnership and will be held by the partners as tenants in common. The accounts of the partnership will usually make it clear which assets are to be considered partnership property and which assets are merely individual property that is to be used by the partnership as in Barton v Morris[15] where it was clear from the partnership’s accounts which assets were to be treated as partnership and individual property. In the instant scenario it would appear as though the office equipment and stationary is partnership property, whilst the rest of the partner’s assets are personal property. However, because there i s no partnership agreement in place that specifies which separates the assets between ‘partnership property’ and ‘partnership capital’ it seems as though s. 20(1) PA 1890 will apply. This means that all of the property that has been brought into the partnership stock will also be called partnership property. This has been recognised by Deards who stated that; â€Å"property brought into the partnership stock will cover property brought in as capital by a partner†.[16] Nevertheless, because s.21 of PA 1890 provides that property brought with the partnership’s money is presumed to have been brought for the partnership, any property that is itemised in the partnerships accounts will be deemed partnership property. This suggests that if the property is not itemised in the partnerships accounts and is merely being used by the partnership, then in the absence of any agreement by the partners, the use of any property by the partners will not be regar ded as partnership property.[17] Consequently, if any of the assets are not itemised in the partnerships accounts it cannot be said that they will be classed as partnership property. In Waterer v Waterer[18], however, the use of land was considered partnership property because of the nature of the partnership. In effect, unless David’s assets are itemised in the partnerships accounts, they will not be considered partnership property. The premises by which the company operates will most likely be considered partnership property in light of the Waterer v Waterer[19] case, whilst the use of Eventbright Ltd will not be. Any assets that are considered partnership property will be shared equally between the partners. Bibliography Books E Deards., Practice Notes on Partnership Law, (Cavendish Publishing, Business Economics, 1999). E MacIntyre., Business Law, (Essex: Pearson, 6th Edition, 2012). R Mann., Essentials of Business Law and the Legal Environment, (London: Cengage Learning, Business Economics, 2009). Journals K Killington., ‘Partnerships – All Are Equal?’ (2008) Tax Journal, Issue 916, 14-16. P Beasang., ‘Partnerships: Legal Issues’ (2008) Tax Journal, Issue 916, 13-14. T M Lewin., ‘What is Partnership Property?’ (2011) http://www.icaew.com/en/technical/farming-and-rural-business/general/what-is-partnership-property [25 July, 2014]. Legislation Partnership Act 1890 Case Law Barton v Morris [1985] 1 WLR 1257 Bathhurst v Scarborough [2004] EWCA Civ 411 Brown v Inland Revenue Commissioners [1965] AC 244 Burdick v Garrick (1869-1870) LR 5 Ch App 233 Const v Harris (1924) Turn R 496 McClelland v Hyde [1997] 3 All ER 800, CA Reed v Young [1984] STC 38, 57-58 Trimble v Goldberg [1906] AC 494, PC Waterer v Waterer (1872-73) 15 LR Eq 402 How to cite What can David do about his position in relation to the other partners?, Essay examples

Internet Argumentative Essay Example For Students

Internet Argumentative Essay Computer Science Government Intervention of the Internet During the past decade, our society has become based solely on the ability to move large amounts of information across large distances quickly. Computerization has influenced everyones life. The natural evolution of computers and this need for ultra-fast communications has caused a global network of interconnected computers to develop. This global net allows a person to send E-mail across the world in mere fractions of a second, and enables even the common person to access information world-wide. With advances such as software that allows users with a sound card to use the Internet as a carrier for long distance voice calls and video conferencing, this network is key to the future of the knowledge society. At present, this net is the epitome of the first amendment: free speech. It is a place where people can speak their mind without being reprimanded for what they say, or how they choose to say it. The key to the world-wide suc cess of the Internet is its protection of free speech, not only in America, but in other countries where free speech is not protected by a constitution. To be found on the Internet is a huge collection of obscene graphics, Anarchists cookbooks and countless other things that offend some people. With over 30 million Internet users in the U.S. alone (only 3 million of which surf the net from home), everything is bound to offend someone. The newest wave of laws floating through law making bodies around the world threatens to stifle this area of spontaneity. Recently, Congress has been considering passing laws that will make it a crime punishable by jail to send vulgar language over the net, and to export encryption software. No matter how small, any attempt at government intervention in the Internet will stifle the greatest communication innovation of this century. The government wants to maintain control over this new form of communication, and they are trying to use the protection of children as a smoke screen to pass laws that will allow them to regulate and censor the Internet, while banning techniques that could eliminate the need for regulation. Censorship of the Internet threatens to destroy its freelance atmosphere, while wide spread encryption could help prevent the need for government intervention. The current body of laws existing today in America does not apply well to the Internet. Is the Internet like a bookstore, where servers cannot be expected to review every title? Is it like a phone company who must ignore what it carries because of privacy? Is it like a broadcasting medium, where the government monitors what is broadcast? The trouble is that the Internet can be all or none of these things depending on how its used. The Internet cannot be viewed as one type of transfer medium under current broadcast definitions. The Internet differs from broadcasting media in that one cannot just happen upon a vulgar site without first entering a complicated ad dress, or following a link from another source. The Internet is much more like going into a book store and choosing to look at adult magazines. (Miller 75). Jim Exon, a democratic senator from Nebraska, wants to pass a decency bill regulating the Internet. If the bill passes, certain commercial servers that post pictures of unclad beings, like those run by Penthouse or Playboy, would of course be shut down immediately or risk prosecution. The same goes for any amateur web site that features nudity, sex talk, or rough language. Posting any dirty words in a Usenet discussion group, which occurs routinely, could make one liable for a $50,000 fine and six months in jail. Even worse, if a magazine that commonly runs some of those nasty words in its pages, The New Yorker for instance, decided to post its contents on-line, its leaders would be held responsible for a $100,000 fine and two years in jail. Why does it suddenly become illegal to post something that has been legal for years in p rint? Exons bill apparently would also criminalize private mail, I can call my brother on the phone and say anythingbut if I say it on the Internet, its illegal (Levy 53). Congress, in their pursuit of regulations, seems to have overlooked the fact that the majority of the adult material on the Internet comes from overseas. Although many U.S. government sources helped fund Arpanet, the predecessor to the Internet, they no longer control it. Many of the new Internet technologies, including the World Wide Web, have come from overseas. There is no clear boundary between information held in the U.S. and information stored in other countries. Data held in foreign computers is just as accessible as data in America, all it takes is the click of a mouse to access. Even if our government tried to regulate the Internet, we have no control over what is posted in other countries, and we have no practical way to stop it. The Internets predecessor was originally designed to uphold communications after a nuclear attack by rerouting data to compensate for destroyed telephone lines and servers. Todays Internet still works on a similar design. The very nature this design allows the Internet to overcome any kind of barriers put in its way. If a major line between two servers, say in two countries, is cut, then the Internet users will find another way around this obstacle. This obstacle avoidance makes it virtually impossible to separate an entire nation from indecent information in other countries. If it was physically possible to isolate Americas computers from the rest of the world, it would be devastating to our economy. Recently, a major university attempted to regulate what types of Internet access its students had, with results reminiscent of a 1960s protest. A research associate at Carnegie Mellon University conducted a study of pornography on the schools computer networks. Martin Rimm put together quite a large picture collection (917,410 images) and he also tracked how often each image had been downloaded (a total of 6.4 million). Pictures of similar content had recently been declared obscene by a local court, and the school feared they might be held responsible for the content of its network. The school administration quickly removed access to all these pictures, and to the newsgroups where most of this obscenity is suspected to come from. A total of 80 newsgroups were removed, causing a large disturbance among the student body, the American Civil Liberties Union, and the Electronic Frontier Foundation, all of whom felt this was unconstitutional. After only half a week, the college had backed down, and restored the newsgroups. This is a tiny example of what may happen if the government tries to impose censorship (Elmer-Dewitt 102). Currently, there is software being released that promises to block childrens access to known X-rated Internet newsgroups and sites. However, since most adults rely on their computer literate children to setup these pr ograms, the children will be able to find ways around them. This mimics real life, where these children would surely be able to get their hands on an adult magazine. Regardless of what types of software or safeguards are used to protect the children of the Information age, there will be ways around them. This necessitates the education of the children to deal with reality. Altered views of an electronic world translate easily into altered views of the real world. When it comes to our children, censorship is a far less important issue than good parenting. We must teach our kids that the Internet is a extension and a reflection of the real world, and we have to show them how to enjoy the good things and avoid the bad things. This isnt the governments responsibility. Its ours (Miller 76). Not all restrictions on electronic speech are bad. Most of the major on-line communication companies have restrictions on what their users can say. They must respect their customers privacy, however. Private E-mail content is off limits to them, but they may act swiftly upon anyone who spouts obscenities in a public forum. Self regulation by users and servers is the key to avoiding government imposed intervention. Many on-line sites such as Playboy and Penthouse have started to regulated themselves. Both post clear warnings that adult content lies ahead and lists the countries where this is illegal. The film and videogame industries subject themselves to ratings, and if Internet users want to avoid government imposed regulations, then it is time they begin to regulate themselves. It all boils down to protecting children from adult material, while protecting the first amendment right to free speech between adults. Government attempts to regulate the Internet are not just limited to obscenity and vulgar language, it also reaches into other areas, such as data encryption. By nature, the Internet is an insecure method of transferring data. A single E-mail packet may pass through hun dreds of computers from its source to destination. At each computer, there is the chance that the data will be archived and someone may intercept that data. Credit card numbers are a frequent target of hackers. Encryption is a means of encoding data so that only someone with the proper key can decode it. Why do you need PGP (encryption)? Its personal. Its private. And its no ones business but yours. You may be planning a political campaign, discussing our taxes, or having an illicit affair. Or you may be doing something that you feel shouldnt be illegal, but is. Whatever it is, you dont want your private electronic mail (E-mail) or confidential documents read by anyone else. Theres nothing wrong with asserting your privacy. Privacy is as apple-pie as the Constitution. Perhaps you think your E-mail is legitimate enough that encryption is unwarranted. If you really are a law-abiding citizen with nothing to hide, then why dont you always send your paper mail on postcards? Why not submi t to drug testing on demand? Why require a warrant for police searches of your house? Are you trying to hide something? You must be a subversive or a drug dealer if you hide your mail inside envelopes. Or maybe a paranoid nut. Do law-abiding citizens have any need to encrypt their E-mail? What if everyone believed that law-abiding citizens should use postcards for their mail? If some brave soul tried to assert his privacy by using an envelope for his mail, it would draw suspicion. Perhaps the authorities would open his mail to see what hes hiding. Fortunately, we dont live in that kind of world, because everyone protects most of their mail with envelopes. So no one draws suspicion by asserting their privacy with an envelope. Theres safety in numbers. Analogously, it would be nice if everyone routinely used encryption for all their E-mail, innocent or not, so that no one drew suspicion by asserting their E-mail privacy with encryption. Think of it as a form of solidarity (Zimmerman). Until the development of the Internet, the U.S. government controlled most new encryption techniques. With the development of faster home computers and a worldwide web, they no longer hold control over encryption. New algorithms have been discovered that are reportedly uncrackable even by the FBI and the NSA. This is a major concern to the government because they want to maintain the ability to conduct wiretaps, and other forms of electronic surveillance into the digital age. To stop the spread of data encryption software, the U.S. government has imposed very strict laws on its exportation. One very well known example of this is the PGP (Pretty Good Privacy) scandal. PGP was written by Phil Zimmerman, and is based on public key encryption. This system uses complex algorithms to produce two codes, one for encoding and one for decoding. To send an encoded message to someone, a copy of that persons public key is needed. The sender uses this public key to encrypt the data, and the reci pient uses their private key to decode the message. As Zimmerman was finishing his program, he heard about a proposed Senate bill to ban cryptography. This prompted him to release his program for free, hoping that it would become so popular that its use could not be stopped. One of the original users of PGP posted it to an Internet site, where anyone from any country could download it, causing a federal investigator to begin investigating Phil for violation of this new law. As with any new technology, this program has allegedly been used for illegal purposes, and the FBI and NSA are believed to be unable to crack this code. When told about the illegal uses of him programs, Zimmerman replies: If I had invented an automobile, and was told that criminals used it to rob banks, I would feel bad, too. But most people agree the benefits to society that come from automobiles taking the kids to school, grocery shopping and such outweigh their drawbacks. (Levy 56). Currently, PGP can be dow nloaded from MIT. They have a very complicated system that changes the location on the software to be sure that they are protected. All that needs to be done is click YES to four questions dealing with exportation and use of the program, and it is there for the taking. This seems to be a lot of trouble to protect a program from spreading that is already world wide. The government wants to protect their ability to legally wiretap, but what good does it do them to stop encryption in foreign countries? They cannot legally wiretap someone in another country, and they sure cannot ban encryption in the U.S. The government has not been totally blind to the need for encryption. For nearly two decades, a government sponsored algorithm, Data Encryption Standard (DES), has been used primarily by banks. The government always maintained the ability to decipher this code with their powerful supercomputers. Now that new forms of encryption have been devised that the government cant decipher, they are proposing a new standard to replace DES. This new standard is called Clipper, and is based on the public key algorithms. Instead of software, Clipper is a microchip that can be incorporated into just about anything (Television, Telephones, etc.). This algorithm uses a much longer key that is 16 million times more powerful than DES. It is estimated that todays fastest computers would take 400 billion years to break this code using every possible key. (Lehrer 378). The catch: At the time of manufacture, each Clipper chip will be loaded with its own unique key, and the Government gets to keep a copy, placed in escrow. Not to worry, though the Government promises that they will use these keys to read your traffic only when duly authorized by law. Of course, to make Clipper completely effective, the next logical step would be to outlaw other forms of cryptography (Zimmerman). If privacy is outlawed, only outlaws will have privacy. Intelligence agencies have access to good cryptograph ic technology. So do the big arms and drug traffickers. So do defense contractors, oil companies, and other corporate giants. But ordinary people and grassroots political organizations mostly have not had access to affordable military grade public-key cryptographic technology. Until now. PGP empowers people to take their privacy into their own hands. Theres a growing social need for it. Thats why I wrote it (Zimmerman). The most important benefits of encryption have been conveniently overlooked by the government. If everyone used encryption, there would be absolutely no way that an innocent bystander could happen upon something they choose not to see. Only the intended receiver of the data could decrypt it (using public key cryptography, not even the sender can decrypt it) and view its contents. Each coded message also has an encrypted signature verifying the senders identity. The senders secret key can be used to encrypt an enclosed signature message, thereby signing it. This creat es a digital signature of a message, which the recipient (or anyone else) can check by using the senders public key to decrypt it. This proves that the sender was the true originator of the message, and that the message has not been subsequently altered by anyone else, because the sender alone possesses the secret key that made that signature. Forgery of a signed message is infeasible, and the sender cannot later disavow his signature(Zimmerman). Gone would be the hate mail that causes many problems, and gone would be the ability to forge a document with someone elses address. The government, if it did not have alterior motives, should mandate encryption, not outlaw it. As the Internet continues to grow throughout the world, more governments may try to impose their views onto the rest of the world through regulations and censorship. It will be a sad day when the world must adjust its views to conform to that of the most prudish regulatory government. If too many regulations are inac ted, then the Internet as a tool will become nearly useless, and the Internet as a mass communication device and a place for freedom of mind and thoughts, will become non existent. The users, servers, and parents of the world must regulate themselves, so as not to force government regulations that may stifle the best communication instrument in history. If encryption catches on and becomes as widespread as Zimmerman predicts it will, then there will no longer be a need for the government to meddle in the Internet, and the biggest problem will work itself out. The government should rethink its approach to the censorship and encryption issues, allowing the Internet to continue to grow and mature. Works Cited Emler-Dewitt, Philip. Censoring Cyberspace: Carnegie Mellons Attempt to Ban Sex from its Campus Computer Network Sends A Chill Along the Info Highway. Time 21 Nov. 1994; 102-105. Lehrer, Dan. The Secret Sharers: Clipper Chips and Cypherpunks. The Nation 10 Oct. 1994; 376-379. Let the Internet Backlash Begin. Advertising Age 7 Nov. 1994; 24. Levy, Steven. The Encryption Wars: is Privacy Good or Bad? Newsweek 24 Apr. 1995; 55-57. Miller, Michael. Cybersex Shock. PC Magazine 10 Oct. 1995; 75-76. Wilson, David. The Internet goes Crackers. Education Digest May 1995; 33-36. Zimmerman, Phil. (1995). Pretty Good Privacy v2.62, Online. Available Ftp: net-dist.mit.edu Directory: pub/pgp/dist File: Pgp262dc.zip Words/ Pages : 3,044 / 24 What is Art? Argumentative Essay