[JackSpratts]

‘Big Brother’ Database for Phones and E-Mails
Richard Ford

A massive government database holding details of every phone call, e-mail and time spent on the internet by the public is being planned as part of the fight against crime and terrorism. Internet service providers (ISPs) and telecoms companies would hand over the records to the Home Office under plans put forward by officials.

The information would be held for at least 12 months and the police and security services would be able to access it if given permission from the courts.

The proposal will raise further alarm about a “Big Brother” society, as it follows plans for vast databases for the ID cards scheme and NHS patients. There will also be concern about the ability of the Government to manage a system holding billions of records. About 57 billion text messages were sent in Britain last year, while an estimated 3 billion e-mails are sent every day.

Home Office officials have discussed the option of the national database with telecommunications companies and ISPs as part of preparations for a data communications Bill to be in November’s Queen’s Speech. But the plan has not been sent to ministers yet.

Industry sources gave warning that a single database would be at greater risk of attack and abuse.

Jonathan Bamford, the assistant Information Commissioner, said: “This would give us serious concerns and may well be a step too far. We are not aware of any justification for the State to hold every UK citizen’s phone and internet records. We have real doubts that such a measure can be justified, or is proportionate or desirable. We have warned before that we are sleepwalking into a surveillance society. Holding large collections of data is always risky - the more data that is collected and stored, the bigger the problem when the data is lost, traded or stolen.”

David Davis, the Shadow Home Secretary, said: “Given [ministers’] appalling record at maintaining the integrity of databases holding people’s sensitive data, this could well be more of a threat to our security, than a support.”

The proposal has emerged as part of plans to implement an EU directive developed after the July 7 bombings to bring uniformity of record-keeping. Since last October telecoms companies have been required to keep records of phone calls and text messages for 12 months. That requirement is to be extended to internet, e-mail and voice-over-internet use and included in a Communications Data Bill.

Police and the security services can access the records with a warrant issued by the courts. Rather than individual companies holding the information, Home Office officials are suggesting the records be handed over to the Government and stored on a huge database.

One of the arguments being put forward in favour of the plan is that it would make it simpler and swifter for law enforcement agencies to retrieve the information instead of having to approach hundreds of service providers. Opponents say that the scope for abuse will be greater if the records are held on one database.

A Home Office spokesman said the Bill was needed to reflect changes in communication that would “increasingly undermine our current capabilities to obtain communications data and use it to protect the public”.
http://business.timesonline.co.uk/to...cle3965033.ece





Secret Data in FBI Wiretapping Audit Revealed With Ctrl+C
Ryan Singel

Once again, supposedly sensitive information blacked out from a government report turns out to be visible by computer experts armed with the Ctrl+C keys -- and that information turns out to be not very sensitive after all.

This time around, University of Pennsylvania professor Matt Blaze discovered that the Justice Department's Inspector General's office had failed to adequately obfuscate data in a March report (.pdf) about FBI payments to telecoms to make their legacy phone switches comply with 1995 wiretapping rules. That report detailed how the FBI had finished spending its allotted $500 million to help telephone companies retrofit their old switches to make them compliant with the Communications Assistance to Law Enforcement Act or Calea-- even as federal wiretaps target cellphones more than 90 percent of the time.

This isn't the first time the Justice Department has made such an error. In 2007, a U.S. attorney referred to Threat Level's own David Kravets (then at the AP) as a hacker for discovering similar hidden information in a Balco steriod case filing. As far back as 2003, a report on minorities in the Justice Department was also vulnerable. The gaffes may seem humorous, but tell that to confidential informants, for whom such a slip-up could be fatal.

In fact, all one needs to do is open the Calea report with Adobe Reader or Foxit reader, and highlight the tables and cut and paste them into a text editor, something Blaze discovered accidentally when trying to copy a portion of the report into an e-mail to a student.

Some of the tidbits considered too sensitive to be aired publicly?

The FBI paid Verizon $2500 a piece to upgrade 1,140 old telephone switches. Oddly the report didn't redact the total amount paid to the telecom -- slightly more than $2.9 million dollars -- but somehow the bad guys will win if they knew the number of switches and the cost paid.

FBI survey results about wiretaps could also be found hidden under the redaction layer.

For the record, in 2005 and 2005, from talking to federal, state and local law enforcement agencies believed that the top emerging technologies causing surveillance concerns were VOIP, broadband and prepaid cellphones. While cops have long fretted about encryption and one might expect it to be in this list, it seems to have never been a problem for wiretapping.

In 2005, only 8 percent had tried tapping internet phone calls, but that number rose to 34 percent in 2006. In 2006, 35 percent of agencies had tried some sort of surveillance on broadband, but the question wasn't asked in 2005.

The price of wiretaps and pen traps still limits surveillance, according to 68 percent of agencies in 2005 and 65 percent in 2006. Meanwhile, telecoms seem to be getting better at providing data in standard formats to cops, whose complaints about data format fell dramatically from 60 percent in 2005 to 12 percent in in 2006.

But, oddly, 41 percent of agencies in 2006 say investigations have been hampered by companies not complying with Calea's mandates, while in 2005, that number was only 22 percent.

Other nuggets? Hidden info in a blacked-out screenshot of the FBI's wiretapping help-line complaint-management software reveals that even wiretappers have IT problems.

Cops in Montgomery County, Maryland had trouble right after Christmas in 2007 getting wiretap info delivered. Not far away in Baltimore (the honorary wiretap capital of the United States), cops had problems just before Christmas using the FBI's database of cell towers, which help cops figure out target's location and movements. Kenner, Louisiana, cops just wanted a user name and password to chat in the Law Enforcement forum on ASKCalea.

Now that the cat is out of the bag, one is sure to see a crime wave across the country.

Professor Matt Blaze suggests following NSA's technical recommendations on how to redact documents. Threat Level merely suggests that report writers start telling the classifiers to stop acting like censors from WWII carrier groups.
http://blog.wired.com/27bstroke6/200...t-data-in.html





Proposed Treaty Turns Internet Into a Virtual Police State
Ben Jones

Leaked documents are one of the banes of modern western politics. They reveal exercises and actions being proposed that are generally objectionable to the public. Such a leak occurred with the Anti-Counterfeiting Trade Agreement (ACTA) which seeks to turn the internet into a virtual police state.

Again, it’s one of the few bastions of anti-corruption, Wikileaks, that has spilled the beans on this unsavory topic. Yesterday the site revealed a document proposing a treaty that will significantly limit the privacy and rights of Internet users, to the benefit of multimillion dollar companies.

“ACTA” is basically an attempt to criminalize the Internet, thus allowing a virtual police state to occur by the selective prosecuting of crimes. In short, it’s an international treaty, or hopes to be, that will greatly increase already draconian copyright measures, in a poor attempt to appease the copyright and patent industries.

The proposal is based on the assumption that ‘intellectual property rights’ (a term used nine times on the first page of the proposal, and 24 times over the entire 3 ½ page document) trump personal privacy, data protection, probable cause, and lots of other important principles in western democracies.

The measure which has received wider publicity is the so-called ‘Pirate Bay killer’. At the end of page two, there is a list of things that should be included in a signee’s legal framework, and in the section about criminal sanctions it states “significant willful infringements without motivation for financial gain to such an extent as to prejudicially affect the copyright holder (e.g., Internet piracy)”. Think non-profit, personal use file-sharing.

Of course, this could go two ways, as the MPAA, for instance, has been guilty of ‘Internet piracy’ in the past, with it’s university toolkit.

Worst of all though, are the following two points speaking of “establishment and imposition of deterrent-level penalties” and “ex-officio authority to take action against infringers”. It is argued that the current level of penalties aren’t harsh enough (“people are still doing it, so they’re no deterrent”), so there should be room for harsher punishments. Combine this with the ability to prosecute without a rights holder complaint, which means that people could be liable for millions, or imprisoned (they are talking about CRIMINAL enforcement) for sharing Steal this Film, or Paulo Coelho’s books. So, these people actively want you to share would have no say in any such prosecution.

There are some other pure gems proposed, such as “ex officio authority for customs authorities to suspend import, export and trans-shipment of suspected IPR infringing goods”. Given that copyright law is so complex and convoluted, and that judges make mistakes in the cases they hear, this is worrying.

Unsurprisingly, the US patent office is backed up beyond belief and dominated by patent trolls that wait until a successful business is established, before pouncing to clean up. This would mean the death for any new and innovative products, or art. If that wasn’t bad enough, there is a further provision for rights holders to prod customs officials into suspension. Thus, a company can make an allegation, forcing a competitors products to be held in limbo until sorted.

Protest has been swift. TorrentFreak occasional contributor Jamie King wrote on his own blog: “In the form that it currently appears to exist, ACTA would ratchet-up further the rights of Hollywood and Recording Industry Association of America (RIAA) at the expense of all of our civil liberties. It provisions to criminalize information use practices currently allowed under U.S., European, and international law are completely disproportionate to the ‘problems’ it claims to address.”

Andrew Norton, chairman of the American Pirate Party was much less restrained: “The very existence of the Anti-Counterfeiting Trade Agreement (ACTA) – be it in policy or just planning, sends one definite message to people around the world; Corruption is rife in the interested countries. There can be no other reason for yet another ‘intellectual property’ (itself a misnomer) law aimed at protecting business interests and expanding government intrusion into the private affairs of it’s citizens, in the name of ‘protection’.”

Of course, the other area most affected by this would be whistle-blower sites like Wikileaks itself. The owner of any leaked document can claim copyright infringement on its publication, and have it pulled. In this, ACTA is a very effective censorship tool. For some reason, though, this aspect has not been widely reported, or even mentioned.
http://torrentfreak.com/proposed-tre...-state-080524/





Govt May Get Keys to Your BlackBerry Mailbox Soon
Rashmi Pratap

In a major change of stance, Canada-based Research In Motion (RIM) may allow the Indian government to intercept non-corporate emails sent over BlackBerrys. This is expected to solve the row between the Department of Telecom (DoT) and RIM to a large extent, since the government’s security concerns pertain more to emails from individual users than enterprise customers.

At the core of the issue is the data encryption technology used in BlackBerrys. BlackBerry uses a very high level of encryption — at 256 bits — while sending data. BlackBerry scrambles messages before sending and unscrambles them at the receiver’s BlackBerry. Owing to security concerns, the government wants to be able to intercept and decode the data.

However, the government’s decryption software can decode messages encrypted only up to 40 bits. India wants RIM to either hand over the decryption keys or reduce encryption to 40 bits.

According to officials close to the development, Canadian High Commissioner David Malone and RIM officials met telecom secretary Siddhartha Behura on May 7. “It was explained by RIM that it should be possible for the government to monitor emails to non-business enterprise customers,” sources told ET. “RIM is considering giving access to individual users’ email to the government. Details on this will be provided in two or three weeks,” sources said.

BlackBerry offers two kinds of services — for enterprise (corporate) customers and for individual (non-corporate) users. Majority of its 1,14,000-plus customers in India are from the enterprise segment. However, decrypting emails of non-corporate customers is a larger security concern for Indian intelligence agencies.

A RIM spokesperson said: “RIM operates in more than 135 countries around the world and respects the regulatory requirements of governments. RIM does not comment on confidential regulatory matters or speculation on such matters in any given country.”

Cyber law expert Pavan Duggal, however, said the move to give partial access to the government could open up potential legal risks for BlackBerry service providers. In India, Blackberry services are offered by Bharti Airtel, Reliance Communications, Vodafone and BPL Mobile.

“By virtue of Sec 79 of IT Act 2000, network service providers are made liable for all third-party data or information made available by them. Therefore, if such an action takes place, then potential of legal action arising cannot be ruled out,” Mr Duggal told ET.

He said there was a need for providing a more comprehensive solution to the issue. “BlackBerry issue has various ramifications — jurisdiction, location of servers, applicable law and a sovereign government exercising the right to intercept data located in foreign land. These piecemeal solutions will not work,” he said.

The issue came to light after the Directorate of Revenue Intelligence expressed inability to intercept any exchange of messages between hawala dealers and militant groups that use BlackBerry device.

Security agencies are said to be insisting that RIM must place its server, through which the information is routed to BlackBerry handhelds, in India. This is not acceptable to RIM as it does not do so in other countries where it offers services.

India has repeatedly assured RIM that its commercial interests will be protected and an amicable solution will be arrived at. Globally, there are over 14 million BlackBerry users and RIM has a large interest in the Indian market, which is adding nearly 10 million subscribers every month.
http://economictimes.indiatimes.com/...ow/3041313.cms





Hit Pause On The Evil Button: Google Assists In Arrest Of Indian Man
Michael Arrington

These stories are becoming more common as Internet companies operate under the laws of many counties.

In February A Moroccan man was arrested for pretending to be the Moroccan king’s younger brother, Prince Moulay Rachid, on Facebook. Facebook complied with Morrocca information requests about the man, leading to his arrest. The man was granted a royal pardon after his sentencing, and was out of jail by mid March.

Today we’re hearing of another arrest, this time in India. 22-year-old IT professional Rahul Krishnakumar Vaid. His crime was writing in an orkut community named “I hate Sonia Gandhi.” Sonia Gandhi is a prominent politician in India.

Vaid was charged under section 292 of Indian Penal Code and section 67 of the Information Technology Act because he created a profile and then posted content in vulgar language about Sonia Gandhi in the community.

During investigations, the cyber crime cell of Pune police communicated with Google (which owns Orkut) seeking details about the man who formed this forum and circulated the obscene content. It was known that the vulgar message about Sonia Gandhi was circulated through an email address – Rahulvaidindia@gmail.com . The owner of the email id Rahul Vaid was traced, using information supplied by Google, to Chakarpur in Gurgaon city of Haryana.

He was then charged under section 292 of Indian Penal Code and section 67 of the Information Technology Act because he created a profile and then posted content in vulgar language about Sonia Gandhi in the community. If he’s convicted, he can be imprisoned for up to five years and may have to pay a fine up to Rs one lakh.

This is an issue that needs to be addressed everywhere, but the hot spots right now are areas where extreme laws make what would be legitimate actions in the US or Europe into fairly serious crimes in their jurisdictions. Our companies have to decide if they’ll defy the law and take the consequences. On the upside, users will flock to them knowing their data is secure.
http://www.techcrunch.com/2008/05/18...of-indian-man/





Google Queried by Congressman on Privacy Plans

Privacy concerns raised
Bloomberg News

Google is facing more scrutiny over its acquisition of DoubleClick after a U.S. lawmaker demanded to know how the Internet company will protect consumers' privacy once their operations are combined. The companies collect "a great deal of data" on consumers' Internet activities, Rep. Joe Barton, R-Texas, said Wednesday in a letter to Google Chief Executive Eric Schmidt. Barton, the House commerce committee's senior Republican, asked Schmidt to respond to six questions on the combination by June 6. Barton, whose panel oversees Internet policy, requested information on whether the companies will merge their data when they combine and how they plan to use them.
http://www.siliconvalley.com/news/ci_9343627





FTC Wants to Know What Big Brother Knows About You

'Behavioral targeting' on web is debated
Peter Whoriskey

How do you find a bride these days?

One of the nation's leading online tracking companies knows.

Monitoring consumers at roughly 3,000 Web sites, Revenue Science identified brides by picking out bridal behavior it had seen: anyone who'd gone online to read about weddings in the news, entered "bridesmaid dresses" into a search engine or surfed fashion pages for wedding styles.

The company found 40,000 such people, whom it knows by random number, not name, and sent them a tailored online ad.

"A successful campaign," according to company president Jeff Hirsch.

The growing practice of "behavioral targeting," or sending ads to online users based on their Internet habits, is now under scrutiny by the Federal Trade Commission, whose review could shape not only Web advertising rules but the character of the Web itself.

For while public interest groups argue that compiling profiles of largely unsuspecting Internet users ought to be illegal, online advertisers and publishers respond that their ad targeting tactics protect privacy and may be essential to support the free content on the Web.

Behavioral targeting allows many Web sites to raise ad prices, because advertisers will pay more when they can isolate a particular audience.

Limiting behavioral targeting could "jeopardize the consumer's ability to get free content on the Internet," said Paul Boyle of the Newspaper Association of America, a trade group that represents the business interests of most U.S. dailies, including The Washington Post.

The FTC is considering guidelines, for now voluntary, that would make it harder to target behavior. The principles were issued in December after town hall meetings, and the public comment period ended last month.

As the commission's deliberations begin, some federal and state lawmakers are weighing measures that would be mandatory. New York lawmakers, for example, are considering a law similar to the FTC guidelines.

Now that many Americans spend as much time interacting with the Web as they do watching TV, there is a wealth of information available for targeters: what articles a person reads in online newspapers, what queries he or she types into search engines and what items the person shops for.

Revenue Science and its peers say that because the user profiles they keep are organized by randomly assigned numbers, no personally identifying information is ever stored.

But privacy groups argue that while the items collected by targeters may be "anonymous" when viewed individually, taken together they could enable someone to match the file on "User 927" to a person. For example, if someone repeatedly does an "ego search" on his or her own name, that file might have the name in it repeatedly.

"It is not anonymous if the companies are tracking the same user over time," said Ari Schwartz of the Center for Democracy and Technology, an advocacy group that has filed comments with the FTC.

Especially troubling, he said, is that the targeters can monitor what people are reading, whether it's news or dinner recipes.

Underlying the FTC debate among public interest groups and Web media and advertising groups such as Google, eBay, newspapers and magazines are larger questions about the Web economy.

With surfers accustomed to accessing online entertainment for free, media companies have been pushed toward online advertising, rather than subscriptions or fees, to make money. But by many measures, online advertising revenue has proven disappointing.

While television advertising amounts to $64 billion annually, online advertising amounts to $11 billion, according to TNS Media Intelligence. Even at hugely popular sites, such as YouTube and social networks such as Facebook and MySpace, which each count tens of millions of visitors a month, owners have struggled to make money from ads. Television networks and newspapers, too, have seen that online advertising generates but a fraction of what they receive in print or broadcast, even on a per-person basis. Behavioral targeting promises to bolster sagging online ad revenue with a more profitable approach.

Most online ad targeting is relatively unsophisticated. Advertisers might know the geographic area of a user based on his or her Internet address. Or an advertiser might target a user based on the context of the Web page being read. An online magazine for audiophiles is a natural place for stereo ads, for example.

But if there is no obvious product to pitch on a Web page, the value of the ad space may be very low and is likely to attract only low-paying ads such as those flashing ads about looking for a lost classmate.

What behavioral targeting does is allow advertisers to target ads based not on what's on the page but who is looking at it.

Revenue Science, like other ad targeting services, tracks users by placing a "cookie," or small file, on a computer when it connects to one of the 3,000 Web sites that the company works with. The cookie essentially identifies that browser as a visitor to sites working with Revenue Science and gives each one a randomly assigned number. No names or other personally identifiable information, such as age or address, are recorded in the cookie.

When a user visits such a site, Revenue Science can record what pages were viewed, what search queries were entered and other information. It can even count, if a newspaper or other publisher allows, how many times a person sees a story regarding any given search term, whether it is "al Qaeda" or "denture adhesive."

The practice becomes more powerful as users move from site to site, betraying more information about their tastes. While some Web sites refuse to share their behavior files with other sites, the ad networks offer financial incentives to Web sites that do. (The Washington Post, which uses Revenue Science, does not allow Web behavior from The Post's site to be accessed by others.)

Detecting from previous Web visits and searches that a reader may be interested in new sport-utility vehicles, for example, a Web site can make as much as 10 times the amount of money showing an ad to that user, compared with an undifferentiated ad.

But while the tactic may lead to profits, it also creates unease. A March poll by Harris Interactive showed that six in 10 people are not comfortable when Web sites use information about a person's online activity to tailor advertisements or content.

As the long-brewing debate shifts to the Federal Trade Commission and possibly Congress, newspapers are likely to play a leading role. The Newspaper Association of America has filed a brief with the FTC arguing that some of the voluntary rules proposed by the agency's staff might violate the First Amendment.

More than 600 newspapers have formed an ad consortium with Yahoo. Another company, formed by the New York Times and three other chains, similarly offers advertisers behavioral targeting.

"The problem for newspapers is that a story headlined 'Two Dead in Baghdad' isn't very product-friendly," said Kent Ertugrul, chief executive of Phorm, a behavioral targeting company working with British newspapers. "But if you know who is looking at the page, that's where the opportunity is."

It is just such added revenue, newspaper lobbyists argue, that the troubled newspaper industry may need to survive the online transition.

In its first draft of voluntary guidelines, the FTC staff called for clear warnings of tracking and for allowing users to permanently opt out of a Web site's tracking mechanism.

"Every Web site," according to the FTC's draft rules, should allow consumers to "choose whether or not to have their information collected for such purpose."

But the newspaper association argues that allowing the user to opt out isn't necessary: If a user doesn't want to be tracked by a site -- assuming the user is aware of being tracked -- he or she can simply avoid that site. Besides, Boyle noted, users are free to periodically delete the cookies on their computers.

"I really don't know that there is a personal privacy issue here," Boyle said. "The government really needs to let things play out."
http://www.washingtonpost.com/wp-dyn...052102989.html





Shops Secretly Track Customers Via Mobile Phone

Signals given off by phones allow shopping centres to monitor how long people stay and which stores they visit
Jonathan Richards

Customers in shopping centres are having their every move tracked by a new type of surveillance that listens in on the whisperings of their mobile phones.

The technology can tell when people enter a shopping centre, what stores they visit, how long they remain there, and what route they take as they walked around.

The device cannot access personal details about a person’s identity or contacts, but privacy campaigners expressed concern about potential intrusion should the data fall into the wrong hands.

The surveillance mechanism works by monitoring the signals produced by mobile handsets and then locating the phone by triangulation – measuring the phone’s distance from three receivers.

It has already been installed in two shopping centres, including Gunwharf Quays in Portsmouth, and three more centres will begin using it next month, Times Online has learnt.

The company that makes the dishes, which measure 30cm (12 inches) square and are placed on walls around the centre, said that they were useful to centres that wanted to learn more about the way their customers used the store.

A shopping mall could, for example, find out that 10,000 people were still in the store at 6pm, helping to make a case for longer opening hours, or that a majority of customers who visited Gap also went to Next, which could useful for marketing purposes.
In the case of Gunwharf Quays, managers were surprised to discover that an unusually high percentage of visitors were German - the receivers can tell in which country each phone is registered - which led to the management translating the instructions in the car park.

The Information Commissioner's Office (ICO) expressed cautious approval of the technology, which does not identify the owner of the phone but rather the handset's IMEI code - a unique number given to every device so that the network can recognise it.

But an ICO spokesman said, "we would be very worried if this technology was used in connection with other systems that contain personal information, if the intention was to provide more detailed profiles about identifiable individuals and their shopping habits.”

Only the phone network can match a handset's IMEI number to the personal details of a customer.

Path Intelligence, the Portsmouth-based company which developed the technology, said its equipment was just a tool for market research. "There's absolutely no way we can link the information we gather back to the individual,” a spokeswoman said. “There's nothing personal in the data."

Sharon Biggar, the company's chief operating officer, said that one of the stores which had already deployed the receivers did not want its name revealed for fear of alarming its customers.

Liberty, the campaign group, said that although the data do not meet the legal definition of ‘personal information’, it "had the potential" to identify particular individuals' shopping habits by referencing information held by the phone networks.

The receivers together cost about £20,000 to rent per month. About 20 the units, which are unobtrusive, cream-coloured boxes about the size of a satellite dish, would be needed to cover the Bluewater shopping centre.

Bluewater, in Kent, said it had no plans to deploy the equipment. A spokesman for Gunwharf Quays was not available for comment.

Owners of large buildings currently have to rely on manual surveys to find out how customers use the space, which can be relevant to questions of design such as where the toilets should be located or which stores should be placed next to one another.

Other types of wireless technology, such as wi-fi and Bluetooth, can be used to locate devices, but the regular phone network signal is preferable because it is much more powerful and fewer receivers are needed to monitor a given area.

Phone networks have long been capable of gauging the rough location of a handset using three phone masts, but the margin error can be as great as 2km. The process is also less efficient when the phone is indoors. Path Intelligence's technology can tell where a phone is to "within a couple of metres."

"You're basically going to know that that person has been in Starbucks," Toby Oliver, the company's chief technology officer, said.

Even when the owner is not using it, a mobile phone makes contact with the network every couple of minutes, which is enough for the receivers to get a reading on its position.
http://technology.timesonline.co.uk/...cle3945496.ece





Internet Story of Pasco 'Wizard' Teacher Spreads Like Magic
Jeffrey S. Solochek

LAND O'LAKES, FLA — Marge Whaley has been called her share of names during her 16 years on the Pasco County School Board.

But nothing compares to the vitriol of Whaley's correspondence from the past two weeks.

"I've been called the worst things I've been called as a School Board member," said Whaley, who has received as many as 50 angry calls and e-mails a day from all over the country. "I got called an 'effing' idiot on my voice mail. … I got called an incompetent turd."

The subject of their venom? A local TV report about a Pasco substitute teacher who claimed to be fired for "wizardry."

• • •

Ordinarily, the sacking of a substitute teacher doesn't make the news at all.

But Jim Piculas said the magic word when he called the local CBS news outlet seeking help and attention to his story.

"It just sounded outrageous," Channel 10 reporter Janie Porter recalled. "The term 'wizardry' that he used, it sounded like the kind of story that would generate a lot of buzz online and on TV."

So instead of sending his call to some nameless producer behind the scenes, the station sent a crew out to interview him and capture his disappearing toothpick trick on tape.

The May 5 story, with the eye-catching Internet headline "Magic trick costs teacher job," quickly launched the 48-year-old former Marine and banker from Tarpon Springs onto the World Wide Web. The report noted that district officials said "it wasn't just the wizardry," and that Piculas "had other performance issues" such as failing to follow the class lesson plan.

In fact, assistant superintendent Renalia DuBose told the St. Petersburg Times, it wasn't the magic trick at all. Rather, the district had written reports from the principal and a teacher at Rushe Middle School detailing Piculas' use of profane language, his inability to control the class and his decision to put a student in charge — something the student's parent complained about.

But those details got drowned out as the tale bounced from blog to blog. It was the wizardry angle, with all its Harry Potter imagery, that grabbed the spotlight.

"The teacher was very smart," said Sree Sreenivasan, a professor of new media at the Columbia University School of Journalism. "It was in his interest to spin it the way he did. … That's a headline I would click and read."

So, too, would thousands of people across the globe.

A story for bloggers

Dozens of bloggers all over the world linked to the story, offering their own comments about the sorry state of Pasco County, Florida, schools and teachers.

Within a day, mainstream media across the country began picking up on the story, too. Piculas said he has received about 20 calls a day from far-flung locales seeking interviews, all of which he rejected. Perhaps the biggest hit was MSNBC's Countdown With Keith Olbermann, which deemed the Pasco County school district one of its three "Worst Persons in the World" for May 7.

"He did a magic trick in which he made a toothpick disappear. Then he got an urgent summons to a meeting at which the principal accused the teacher of, quote, wizardry. (In mocking voice) 'He turned me into a newt,' " Olbermann said in the broadcast, laughing. "Now, most of Florida is in the Eastern time zone. But apparently Land O'Lakes is one of those pockets that uses its own clock. Their time zone is apparently the Middle Ages."

Superintendent Heather Fiorentino sent Olbermann an e-mail urging him to check the record for himself.

"There were several compelling reasons for the dismissal, none of which were even remotely related to 'Wizardry,' as was suggested in the news accounts," she wrote.

Some local reporters looked at the district files and didn't write about Piculas. Others, including Channel 10, aired follow-ups giving more detail about what happened during Piculas' last classroom stint in January.

Still, the original story slogged on. Each link it received from another Web site pushed it higher up the Google search page, where more people could find it.

Some bloggers urged readers to contact Pasco school officials with their opinions about firing the "wizard."

That they did.

The abuse begins

Whaley appears to have received the most e-mails and calls. But the school also got its share of calls. So did Fiorentino and her secretaries. School Board member Allen Altman said he got about 40 e-mails, mostly from outside Florida, most of which could not be reprinted in a family newspaper.

"It was just amazing to me how crude and profane people would be without doing any research to find out if there was any fact behind what they had read in an online story out of state," he said.

Piculas, who said he never intended for the story to be anything but local, expressed dismay at the arc that it had taken. The reader response particularly bothered him.

"Is there so little going on in these peoples' lives? I don't know what these people are thinking. That they are my advocates and that somehow a profanity-laced e-mail is going to benefit me?" he said. "They've got some issues of their own. If I met any of these board members, I would apologize to them profusely."

Made for the Internet

While there's no set recipe to set a story on fire on the Internet, each one has some similarities.

The stories generally are somewhat outlandish or unusual, Sreenivasan said. It helps if the report has a pithy headline that fits in an e-mail subject line, like "Teacher fired for wizardry."

"This is all par for the Internet course," he said. "These are the stories that some journalists love."

And once a story hits on the Internet, it stays there forever.

"It's very difficult to undo this information once it's out there," said Mary Madden, a senior research specialist for the Pew Internet and American Life Project.

She noted that 11 percent of adult Internet users will Google job candidates' names to see what's been written about them on the Web; and 19 percent look into the Web life of colleagues and co-workers.

That could have ill effects for both Piculas, who is applying for teaching jobs in Hillsborough and Hernando counties, and for the school district, which will be known as the county that fires wizards — at least until the next water-skiing squirrel comes along.

A lessons about truth

The entire chain of events left Whaley with a bitter aftertaste. She found herself disgusted with the nasty comments she received, but also with peoples' seeming disregard for facts.

"It really made me stop and think," Whaley said of the versions of Piculas' firing that made the Web. "Because I go to the Internet for information, say, to look at information on medication I'm taking. Now I'll be more careful.

"You really can't count on every Web site … because you're likely to get information that isn't true," she said.
http://www.tampabay.com/news/educati...icle511648.ece





Milestones

Michael Rossman, Who Fought for Campus Rights, Dies at 68
Margalit Fox

Michael Rossman, an organizer of the Free Speech Movement at the University of California, Berkeley, who was later known for his books on politics, society and education, died May 12 at his home in Berkeley. He was 68.

The cause was leukemia, his wife, Karen McLellan, said.

Mr. Rossman’s first book, “The Wedding Within the War” (Doubleday, 1971), was a collection of essays chronicling his experiences in the free speech, antiwar and counterculture movements. Reviewing the collection in The New York Times Book Review, the historian Martin Duberman called it “a dazzling, moving book,” adding: “I find the life Rossman is trying to fashion for himself admirable, and the book he’s written about it exhilarating.”

Mr. Rossman’s other books include “On Learning and Social Change” (Random House, 1972) and “New Age Blues: On the Politics of Consciousness” (Dutton, 1979).

Michael Dale Rossman was born on Dec. 15, 1939, in Denver and reared in Northern California. His father, Harold, was the editor of The Labor Herald, the weekly newspaper of the Congress of Industrial Organizations in California. Mr. Rossman studied at the University of Chicago before transferring to Berkeley, from which he received a bachelor’s degree in mathematics in 1963.

Mr. Rossman was a graduate student in math at Berkeley when the Free Speech Movement burst into being on Oct. 1, 1964. He was among the hundreds of students who massed around a police car that day and the next to stop officers from taking away the civil rights organizer Jack Weinberg. (Mr. Weinberg had been arrested for violating a longstanding university ban on political advocacy on campus.)

A close friend of Mario Savio, the movement’s best-known leader, Mr. Rossman left graduate school in 1966 to devote himself to activism, lecturing on campuses around the country. The Free Speech Movement, which quickly spread to other universities, made political discourse a basic right on college campuses throughout the nation.

Mr. Rossman remained a community activist to the end of his life. For the last three decades, he also taught primary-school science in Berkeley.

In addition to his wife, Mr. Rossman is survived by two sons, Lorca, of Olema, Calif., and Jaime Kaszynski of Olympia, Wash; a brother, Jared, of Redway, Calif.; a sister, Devora Rossman of Mendocino, Calif.; and one grandchild.

As a consequence of his involvement with the Free Speech Movement, Mr. Rossman spent nine weeks in jail in 1967. There, he was assigned to garbage detail, a job far less punitive than his jailers must have imagined.

As Mr. Rossman explained in an essay in “The Wedding Within the War,” he had no sense of smell.
http://www.nytimes.com/2008/05/19/ed...19rossman.html





Supreme Court Upholds Law Aimed at Child Pornography
David Stout

The Supreme Court on Monday upheld a 2003 federal law aimed at child pornography, concluding in a 7-to-2 opinion that a federal appeals court was wrong to find the law unconstitutionally vague.

“Child pornography harms and debases the most defenseless of our citizens,” Justice Antonin Scalia wrote for the court. “Both the state and federal governments have sought to suppress it for many years, only to find it proliferating through the new medium of the Internet.”

The ruling scathingly rejected contentions that the 2003 legislation was so broadly written that it could make it a crime to share or even describe depictions of children in explicit sexual situations, even if the depictions are inaccurate, the children do not really exist and the intention is innocent.

Monday’s decision in United States v. Williams reinstated the conviction of Michael Williams of Florida, who was caught in a federal undercover operation in April 2004 and found guilty later of “pandering” child pornography, a charge defined in part as promoting or distributing real or “purported” material in a way that reflects the belief — or is intended to persuade another — that the material is indeed child pornography.

Mr. Williams was nabbed offering to trade nude pictures of his young daughter and other forms of child pornography in an Internet chat room. He did not actually have pictures of his daughter, but he did have 22 pornographic images of other children on his computer hard drive. He pleaded guilty to possessing that material, which has long been a crime, and was sentenced to five years in prison. That aspect of the case against him was not part of the Supreme Court argument.

Instead, lawyers on his behalf challenged the “pandering” charge, which also carries a five-year sentence, asserting that it was so “overly broad” as to violate the First Amendment guarantee of free speech. The United States Court of Appeals for the 11th Circuit found that argument persuasive, reasoning that offering a copy of “Snow White” on false claims that it depicts minors engaging in sex could be construed as criminal behavior.

But Justice Scalia dismissed the 11th Circuit’s finding, its reliance on what he considered far-fetched hypothetical situations and the notion that the statute under review would cause all sorts of fact-finding problems. Judges and juries are routinely called upon to assess difficult issues of fact and intent involving charges like conspiracy, incitement and solicitation, he wrote.

In 2002, the court struck down a law that made it a crime to create, distribute or possess “virtual” child pornography that uses computer-generated images or young-looking adults rather than real children. But, as Justice Scalia noted on Monday, the Supreme Court has held that the government can criminalize the mere possession of actual child pornography, as distinct from mere possession of pornography involving adults.

Justice Scalia’s opinion not only swept aside the defendant’s contention that the law as written was too vague but said it made no difference whether the pornography was offered for sale or was promoted as being free. Consider a drug case, he suggested: “It would be an odd constitutional principle that permitted the government to prohibit offers to sell illegal drugs, but not offers to give them away for free.”

Joining the opinion were Chief Justice John G. Roberts Jr. and Justices John Paul Stevens, Anthony M. Kennedy, Clarence Thomas, Stephen G. Breyer and Samuel A. Alito Jr.

Justices David H. Souter and Ruth Bader Ginsburg dissented, with Justice Souter writing that promoting images that are not real children engaging in pornography still could be prosecuted under the law at issue.
http://www.nytimes.com/2008/05/20/wa...scotus.html?hp





Senators OK $1 Billion for Online Child Porn Fight
Anne Broache

A U.S. Senate panel has unanimously approved a bill that would encourage federal, state, and local police to use and create special software designed to nab child pornography swappers on peer-to-peer file-sharing networks.

The Senate Judiciary Committee on Thursday voted to send an amended version of the Combating Child Exploitation Act, chiefly sponsored by Sen. Joe Biden (D-Del.), to the full slate of politicians for a vote.

All told, the bill would allocate more than $1 billion over the next eight years for a broad array of efforts aimed at tackling Internet crimes against children. It calls for hiring 250 new federal agents at the FBI, the Immigrations and Custom Enforcement Agency, and the U.S. Postal Service dedicated to child exploitation cases; for beefing up personnel, equipment, and educational programs designed to combat Internet crimes against children; and for creating new forensics laboratories if the attorney general deems it necessary to deal with a "backlog" of online child exploitation cases.

"We need to give law enforcement the funds and the tools to pull the plug on Internet predators," Biden said in a statement.

An amendment adopted Thursday also adds new sections to the original bill that would rewrite existing child pornography laws. One section is designed to make it clear that live Webcam broadcasts of child abuse are illegal, which the bill's authors argue is an "open question." Another change is aimed at closing another perceived loophole, prohibiting digital alteration of an innocent image of a child so that sexually explicit activity is instead depicted.

It's unclear whether the changes are necessary. The Justice Department in the past, for instance, has netted guilty pleas in cases related to live Webcam recordings involving minors engaged in sexual acts.

The bill's passage follows a hearing last month at which Biden and other senators suggested they saw considerable promise in software designed to detect child pornography sources--specifically a tool called "Operation Fairplay." The so-called "comprehensive computer infrastructure" was developed two years ago by Special Agent Flint Waters in the Wyoming Attorney General's Office, where the system is still housed, and is currently being used by online child exploitation investigators nationwide.

The bill approved Thursday allocates $2 million for the attorney general to build upon that software by creating a "National Internet Crimes Against Children Data System," which would make information about ongoing cases--particularly high-priority ones--accessible to investigators nationwide and coordinate development of new software tools designed to detect alleged child predators in real time.

Through the existing Fairplay system, investigators log onto peer-to-peer file-sharing networks as any other person would and search for files containing certain keywords that are likely to indicate child pornography is involved. Then they download files--frequently videos, sometimes as long as 20 to 30 minutes, with names like "children kiddy underage illegal.mpg" and much more obscene--to their own machines. The Fairplay software allows the investigator to obtain the IP address of the file's sender and, in some cases, display its geographic location in map form.

Once armed with an IP address and date and time of the download, investigators can subpoena the Internet service provider for more information, such as name and address of the subscriber who was assigned it at that moment. It's not clear whether any wiretaps are also conducted to monitor ongoing file-swapping.

Through that process, investigators have identified more than 600,000 unique computers allegedly trafficking in child pornography and traced them to the United States. But Biden and others have voiced dismay that they're only equipped with the resources to investigate about 2 percent of those potential cases.
http://www.news.com/8301-10784_3-994...?tag=nefd.lede





Teen Charged After Posting Nude Photos of 16-Year-Old on MySpace
Anne Jungen

Felony charges were filed today against a La Crosse teen accused of posting nude photographs of a 16-year-old female on his MySpace page.

Alex Phillips, 17, of W4300 Hwy. M, No. 79, was charged with possession of child pornography, sexual exploitation of a child and defamation in La Crosse County Circuit Court.

La Crosse County authorities confirmed Saturday that Phillips' Web site had two photographs of the naked girl after receiving a tip from police in Janesville, Wis., according to the criminal complaint.

Phillips had no intention of removing the photographs, the complaint stated. Told by police he could go to jail for posting the photos, “his reply was, ‘(Expletive) that. I am keeping them up,’” according to the complaint.
http://www.lacrossetribune.com/artic.../08myspace.txt





Police Quiz Photographer Over Nude Shots

Police have interviewed photographer Bill Henson about an art exhibition featuring nude shots of teenagers.

The exhibition was to open at the Roslyn Oxley9 gallery in the Sydney suburb of Paddington last night.

The gallery agreed to suspend the exhibition while police conduct interviews.

Police still need to talk to a 13-year-old girl who appears on the invitation for the exhibition.

They also want to speak to her parents, before deciding if the exhibition should go ahead.

Images from the exhibition that were displayed on the gallery's website have been taken down.

Detectives from the Child Exploitation Internet Unit are reviewing them.

The Department of Community Services has also been contacted.

The Minister for Community Services, Kevin Greene, says police and the Office of the Children's Guardian are investigating to see if the photos break any laws.

'Revolting'

The exhibition has reopened the debate about censorship and what constitutes pornography.

Gallery staff say they received a large number of phone complaints before the exhibition was suspended.

Prime Minister Kevin Rudd has told Channel Nine the photos are revolting.

"Kids deserve to have the innocence of their childhood protected," Mr Rudd said.

"I have a very deep view of this. For God's sake, let's just allow kids to be kids.

"Whatever the artistic merits of that sort of stuff, frankly I don't think there are any."

The New South Wales Opposition Leader, Barry O'Farrell, says the photographs are inappropriate.

"Art will always push society's boundaries, but protection of our children must always be the priority," he said.

"It wasn't OK for a 14-year-old model fully dressed to be on the catwalk for Australian Fashion week, [so] it's definitely not OK for naked children to have their privacy and childhood stolen in the name of art."

Child protection advocate Hetty Johnston thinks police should lay charges.

"It's child pornography by any name you want to call it."

'Surprising' reaction

But art market analyst Michael Reid saw the photos before the exhibition was due to open.

He says they do not sexualise the children involved.

"I went and had a very good look at that exhibition before it opened up," Mr Reid said.

"In my opinion it didn't [sexualise the children]."

College of Fine Arts Associate Professor Joanne Mendelsohn thinks the reaction to Henson's work is surprising.

"I remember seeing a major exhibition of his work at the Art Gallery of New South Wales, it might have been his Venice works, about 10 years ago. Not a peep, not a murmur, and yet the work that was shown then is remarkably similar to the work that has caused such an uproar now," she said.
http://au.news.yahoo.com/080522/21/16z28.html





Pixels at an Exhibition
Virginia Heffernan

What do video artists make of YouTube? Every minute, 10 hours of video are uploaded to the video-sharing site, which now shows hundreds of millions of videos each day. The place is a mess. Maybe artists should avoid it altogether.

The curator and Internet-art booster Rachel Greene has come up with another suggestion: artists could use YouTube, like a supply store, slag heap or rag-and-bone shop. To make the point, she recently asked a set of art-world figures — Sue de Beer, Matthew Higgs, Matthew Ronay and Wayne Koestenbaum — to present and project their favorite YouTube videos in Manhattan on May 13 at the Kitchen gallery. According to catalog copy for the show, “Artists Using YouTube,” some of the videos on exhibit provide “indirect fodder” for the artists’ own work.

Fodder — aha. Maybe that’s purpose of YouTube.

The shrewdest contributor to the show is the video artist Sue de Beer. De Beer’s first choice of clip is inspired: the final scene from “The American Soldier,” Rainer Werner Fassbinder’s 1970 film. Two slight men appear, backing nervously away from the camera, each with a gun pointed at the viewer. What an ingenious start. A woman in the frame cries out. The two men startle and turn, just as the camera does an about-face to show another armed man, on his knees, who fires two shots. Down fall both original men, as the film turns to slo-mo. The film is black and white, and the shapes are just simple enough — lockers, as at a bus station; short staircase; pay phone — to be readable at YouTube’s dirtiest resolution.

The person who originally uploaded the Fassbinder clip to YouTube was evidently drawn to the song on the soundtrack (“So Much Tenderness”) and framed the clip as a music video. But de Beer finds other significance in it. The threadbare print, the (mostly) immobile camera and the institutional quality of the set suggest a surveillance video. Indeed, one of de Beer’s other YouTube selections shows actual surveillance footage from the 1999 shooting at Columbine High School. She’s pressing the connection. Taken together, the Fassbinder and Columbine images are a good reminder that since 1970, when “The American Soldier” appeared, documentary audiences have had considerable practice reading surveillance and evidentiary images. With Columbine scenes and murders of all kinds playing on thousands of screens in the YouTube googolplex — the Saddam Hussein execution, the shooting of a police officer in New Hampshire — the Fassbinder scene comes to seem like one of them. Just as primitive artifacts placed in the context of high modernism seem to anticipate it, or interpret it, so a vintage film clip set online amid the YouTube flotsam can take on entirely new meaning.

De Beer also chose a video that shows the fashion designer Coco Chanel pricklishly fielding interview questions in unsubtitled French while smoking in the middle of her ornate drawing room. It’s moving and even unnerving to see a clip like this liberated from commentary. Even five years ago, you’d never have encountered it except in a documentary about fashion or feminism, where its significance would be assigned by pedantic talking heads. On YouTube, the strange tableau takes on a life of its own. Chanel can’t settle down; she fairly squirms and won’t take a seat in her own house. Similarly uncomfortable-looking is the dancer in de Beer’s final choice, “Footworkin,” an amateur video that shows a living-room dancer flapping and kicking to “My Funny Valentine.” Behind the dancer is a wilted bouquet of foil balloons, whose muted shine recalls the gilded mirror behind Chanel. De Beer draws bright lines with her curatorial choices, proposing connections between disparate images and showing how video clips are reincarnated by the format and community of YouTube. It’s an imaginative collection.

The other contributions to “Artists Using YouTube” aren’t as wisely chosen. The artist Matthew Higgs is also a curator, which might explain why his collection advertises its theme — the grooviness of the 1980s — so relentlessly. The archival clips he chose from YouTube serve as an audiovisual lecture, in which they do nothing but loyally make that case. One clip, of Talking Heads playing “Born Under Punches” in Rome in 1980, is shot largely at groin level, amid sound equipment that is being manipulated for feedback squeals and other effects; it’s like being close to the crooked spine and fritzed nervous system of a body that’s simultaneously pushing its sex appeal. The camerawork is pushy and invasive, and Tina Weymouth is stunning, but the film gains nothing, and loses much, by being on YouTube.

Higgs’s second entry, “New Order: Confusion,” is a music video, apparently originally sent to TV stations to promote the song (“For heavy rotation,” a card proposes at the end). It’s a kind of nocturnal race through New York City — subways covered in graffiti, old Times Square marquees and the twin towers in the distance — that seems coked-up on instant nostalgia. But does Higgs expect viewers only to share the ’80s love? It seems so: his final selection, a 1988 video by the Fall, is straight from the nostalgia-channel VH1 Classic, complete with the logo bug. Pop-culture connoisseurs should know about these videos. But get a collection on DVD. As YouTube entries, they don’t have much to say.

Matthew Ronay, a sculptor and another contributor to the exhibition, sent Rachel Greene, the curator, an enormous list of links, flinging at her a series of sobs from the heart — a daunting stream of words and images half-designed as a filibuster. He chose videos that purport to show the supernatural, things like levitation and magic, and though no single one is decisive, they suggest in the aggregate that something is going on here. After Sept. 11, Ronay explained in an e-mail message to Greene, he felt drawn to Islam. “Is my desire to investigate Islam similar to the way that people became interested in Eastern religions during Vietnam?” Looking for answers, he writes, “I read some Joseph Campbell and Unabomber.”

You can’t help watching closely the video clips Ronay provided. A man rises into the air over a circle of fire. Alligators are hypnotized. Gurus of every stripe dilate. Ronay is obsessive. He’s got more. He’s trying to nail something down. Something in the compulsive amassing of evidence for animism, voodoo, shamanism and other paranormal phenomena is heartbreaking and rousing. In his e-mail message to Greene, he relates his YouTube search terms — “spells,” “sacrifice,” “rewilding” — and you can picture him skimming hundreds of videos looking for the face of God.

But Ronay is nonetheless a victim of YouTube. Unlike de Beer, whose rarefied selections make heavy demands on the viewer, Ronay approaches video through search terms, which means he encounters only videos that have been rigged to be found by someone with his interests. What’s more, the videos are prepackaged as proof of a paranormal realm, and that’s no different from how he employs them; he offers no new purpose for the clips. (It seems not to have even occurred to the fourth contributor to the exhibition, the art critic Wayne Koestenbaum, that YouTube videos could be considered freestanding art. As of this writing, he hadn’t settled on specific entries — only subject matter — for his part of the exhibition.)

No artist should take lightly the opportunity to use YouTube. In my view, YouTube is neither a nascent art form nor a video library but a recently unearthed civilization. Everything’s muddy and looks kind of ruined. If you don’t have firm convictions about visual art, you won’t come on them just by poking around; everything will seem worthless. But while most of the stuff being dusted off and put into baggies at YouTube are indeed bent spoons and dime-a-dozen arrowheads, an archeologist with his eyes open can still be surprised by treasure.
http://www.nytimes.com/2008/05/18/ma...l?ref=magazine





Can e-Publishing Overcome Copyright Concerns?

Every so often, I get an e-mailed request like this:

“Dear David: I’ve checked the O’Reilly and Amazon sites, but I can’t seem to find electronic versions of your Missing Manual books.

“I’ve checked out Safari (safari.oreilly.com), where I can pay a subscription fee for unlimited monthly access to hundreds of computer books from various publishers. But that’s not practical for a single book purchase. I also saw the single-chapter PDF purchase option–again, not practical if you’d like the complete book.

“Sounds like a few butts might need to be kicked in the publishing world to push them into the 21st century. Thanks in advance for your help.”

With a sigh, I always reply to these queries with the same sad response:

“Unfortunately, I’ve had terrible experiences releasing my books in electronic form. Twice in my career, ‘blind’ people e-mailed me, requesting a PDF of one of my books. Both times, I sent one over–and both times, it was all over the piracy sites within 48 hours, free for anyone to download.

“I’ve got a mortgage and three kids to put through college, and it broke my heart! Unfortunately, the bad apples have once again spoiled it for everyone else.”

Now, I realize that my position is unpopular in some circles. And the piracy issue really does bum me out, because some of my how-to books (on Windows Vista and Mac OS X, for example) are 900-page behemoths that would be so much easier to carry, read and search right on the screen.

But this week, I came across a blog post by author Steven Poole on just this topic. (It’s at http://stevenpoole.net/blog/free-your-mind, and it contains a couple of naughty words.) He recently conducted an experiment: he offered an electronic download of one of his books, called “Trigger Happy,” on a “pay what you like” model. In assessing the results, he writes:

“Is this, as some people say, an exciting new Internet-age business model for writers and other creative types?

“Er, not really. The proportion of people who left a tip after downloading “Trigger Happy” was 1 in 1,750, or 0.057%.”

Mr. Poole, as it turns out, is just as disinclined as I am to make free electronic delivery his primary distribution channel. Here’s how he covers the “information wants to be free” line of reasoning, which he calls “the Slashdot argument”:

“It says that books, music, films, software and so on ought to be freely distributed to anyone who wants them, simply because they can be freely distributed.

“What is the writer or musician to do, though, if she can’t earn money from her art? Simple, says the Slashdotter: earn your money playing live (if you’re one of those musicians who plays live), or selling T-shirts or merchandise, or providing some other kind of ‘value-added’ service. Many such arguments seem to me to be simple greed disguised in high-falutin’ idealism about how ‘information wants to be free.’

“…I think the Slashdot argument can actually be disposed of rapidly with one rhetorical question, as follows.

“Oh Mr. Freetard, you work as a programmer, do you? How interesting. So do you perform all your corporate programming duties for free, and earn your keep by selling personally branded mousemats on the side?

“Didn’t think so.”

But what about the Radiohead experiment, where the band released an album online using a “pay what you like” system–and succeeded?

As Mr. Poole points out, that’s fine if you’re already an established name: “If there’s been a comparable success by a band that hasn’t already gained its cultural capital and name-recognition through the evils of copyright and corporate promotion, I’d like to know about it.”

So yes, this is how I, as an author who’s been twice-burned, truly feel. And yet I realize that it puts me, rather awkwardly, on the same side of the piracy issue as the record companies and movie companies, who are suing teenagers for downloading songs, and of whom I’ve made endless fun.

Actually, authors like me are lucky; our work is, at this point, pretty much protected with unbreakable copy protection. That is, our bound and published books can’t be duplicated infinitely and distributed by the millions online.

So what would I do if I were in the business of music or movies, where piracy is so much easier?

I’m just happy I don’t have to answer that question.
http://pogue.blogs.nytimes.com/2008/.../index.html?hp





Apple, CBS Sued by Device-Maker Over 'Mighty Mouse' Trademark

Apple, maker of the iPod media player, and CBS were sued for trademark infringement by closely held computer-accessory firm Man & Machine over the name of Apple's wireless "Mighty Mouse" device. Apple started selling computer mice under the name "Mighty Mouse" more than a year after Man & Machine began selling waterproof and chemical-resistant computer mice to labs and hospitals under that name in 2004, according to the suit filed Tuesday in Greenbelt, Md. Man & Machine claims its earlier use trumps Apple's, even though Apple sells more products. The names of both products play on the 1942 animated super hero mouse whose trademark rights are partly owned by CBS. New York-based CBS is accused of licensing "Mighty Mouse" to Apple for computer devices when its trademark doesn't cover such goods. Man & Machine and CBS both hold trademark applications for the term and are challenging each other for approval at the U.S. Patent and Trademark Office.
http://www.siliconvalley.com/news/ci...nclick_check=1





“First-sale” doctrine an issue in summary judgment

Federal Court Slaps Down Autodesk Arguments, Favors eBay Seller

The US District Court in Seattle on Wednesday ruled in favor of eBay seller Timothy S. Vernor, denying Autodesk’s request for “summary judgment” against Vernor. In doing so the court ruled that Vernor had the right to appeal for relief from Autodesk actions based on the “first sale” doctrine of copyright law. In finding for Vernor, Judge Richard Jones’ ruling dismissed most of Autodesk’s wide-ranging legal arguments as without standing.

If allowed to stand, the ruling effectively pulls the heart out of the license agreements that accompany most retail software products on the market today. You can be sure that not only Autodesk, but most software companies, will take action of some sort in response. It is unimaginable that Autodesk will not appeal this decision.

The case is not over; the court has ordered both sides to sit down and discuss whether the case should continue and settle Vernor’s claim that Autodesk engaged in unfair trade practices in violation of state law in either California (Autodesk’s home) or Washington state (Vernor’s home). Their report to the court is due June 27.

The 21-page ruling sifts through the many and varied arguments raised by both parties. It did so by first settling the issue of whether or not the “first sale” doctrine applied. Once the court found that “first sale” applied, his findings then used “first sale” as a lens for examining all other claims.

To summarize, the court ruled:

• Vernor has legal standing to seek relief;
• Vernor is entitled to protection from Autodesk based on the “first sale doctrine” of copyright law;
• Vernor’s sale of boxes of AutoCAD is not “contributory copyright infringement” as Autodesk alleged;
• Autodesk has not established that its license binds Vernor or his customers;
• There is room for further argument on Vernor’s claim of unfair trade practices.

Here are some quotes from the ruling:

“Autodesk’s additional contention that Mr. Vernor’s harm flows from eBay’s policies rather than Autodesk is specious. … EBay would have taken no action against Mr. Vernor but for Autodesk’s allegations. There is no basis to blame eBay for the consequences of Autodesk’s copyright enforcement efforts.”

“Not only has Autodesk failed to surmount the thorny issues of privity and mutual assent inherent in its contention that its License binds Mr. Vernor and his customers, it has ignored the terms of the License itself. The Autodesk License is expressly “nontransferable.” … Autodesk does not explain how a nontransferable license can bind subsequent transferees.”

A copy of the ruling will be posted at CADCAMNet tonight.
http://aecnews.com/news/2008/05/21/3414.aspx





Little Orphan Artworks
Lawrence Lessig

CONGRESS is considering a major reform of copyright law intended to solve the problem of “orphan works” — those works whose owner cannot be found. This “reform” would be an amazingly onerous and inefficient change, which would unfairly and unnecessarily burden copyright holders with little return to the public.

The problem of orphan works is real. It was caused by a fundamental shift in the architecture of copyright law. Before 1978, copyright was an opt-in system, granting protection only to those who registered and renewed their copyright, and only if they marked their creative work with the famous ©. But three decades ago, Congress created an opt-out system. Copyright protection is now automatic, and it extends for almost a century, whether the author wants or needs it or even knows that his work is regulated by federal law.

The old system filtered copyright protection to those works that needed it; the new system regulates indiscriminately. The Congressional Research Service has estimated that just 2 percent of copyrighted works that are 55 to 75 years old retain any commercial value. Yet the system maintains no registry of copyright owners nor of entities from which permission to use a copyrighted work can be sought. The consequence has been that an extraordinary chunk of culture gets mired in unnecessary copyright regulation.

The solution before Congress, however, is both unfair and unwise. The bill would excuse copyright infringers from significant damages if they can prove that they made a “diligent effort” to find the copyright owner. A “diligent effort” is defined as one that is “reasonable and appropriate,” as determined by a set of “best practices” maintained by the government.

But precisely what must be done by either the “infringer” or the copyright owner seeking to avoid infringement is not specified upfront. The bill instead would have us rely on a class of copyright experts who would advise or be employed by libraries. These experts would encourage copyright infringement by assuring that the costs of infringement are not too great. The bill makes no distinction between old and new works, or between foreign and domestic works. All work, whether old or new, whether created in America or Ukraine, is governed by the same slippery standard.

The proposed change is unfair because since 1978, the law has told creators that there was nothing they needed to do to protect their copyright. Many have relied on that promise. Likewise, the change is unfair to foreign copyright holders, who have little notice of arcane changes in Copyright Office procedures, and who will now find their copyrights vulnerable to willful infringement by Americans.

The change is also unwise, because for all this unfairness, it simply wouldn’t do much good. The uncertain standard of the bill doesn’t offer any efficient opportunity for libraries or archives to make older works available, because the cost of a “diligent effort” is not going to be cheap. The only beneficiaries would be the new class of “diligent effort” searchers who would be a drain on library budgets.

Congress could easily address the problem of orphan works in a manner that is efficient and not unfair to current or foreign copyright owners. Following the model of patent law, Congress should require a copyright owner to register a work after an initial and generous term of automatic and full protection.

For 14 years, a copyright owner would need to do nothing to receive the full protection of copyright law. But after 14 years, to receive full protection, the owner would have to take the minimal step of registering the work with an approved, privately managed and competitive registry, and of paying the copyright office $1.

This rule would not apply to foreign works, because it is unfair and illegal to burden foreign rights-holders with these formalities. It would not apply, immediately at least, to work created between 1978 and today. And it would apply to photographs or other difficult-to-register works only when the technology exists to develop reliable and simple registration databases that would make searching for the copyright owners of visual works an easy task.

A hired expert shouldn’t be required for an orchestra to know if it can perform a work composed during World War II or for a small museum to know whether it can put a photograph from the New Deal on its Web site. In a digital age, knowing the law should be simple and cheap. Congress should be pushing for rules that encourage clarity, not more work for copyright experts.
http://www.nytimes.com/2008/05/20/opinion/20lessig.html





IP Journal

Can a Dead Brand Live Again?
Rob Walker

Do you remember Brim?

The coffee brand? Perhaps you recall its advertising slogan: “Fill it to the rim — with Brim!” Those ads haven’t been shown in years, and Brim itself has been off retail shelves since the 1990s. Yet depending on how old you are, there’s a fair chance that there’s some echo of the Brim brand in your brain. That’s no surprise, given that from 1961 to around 1995, General Foods spent tens, if not hundreds, of millions of dollars to get it there. But General Foods disappeared into the conglomerate now known as Altria, which also acquired Kraft, maker of Maxwell House. With much smaller sales than that megabrand, Brim soon disappeared — except, perhaps, for a vague idea of Brim that lingered, and lingers even now, in the minds of millions of consumers.

What’s that worth? A small company in Chicago, called River West Brands, figures that it’s definitely worth something, and possibly quite a lot. The firm did its own research a year or so ago and claims that among people over the age of 25, Brim had 92 percent “aided national awareness.” What this means is that if you ask people anywhere in America if they have ever heard of Brim, about 9 out of 10 will say yes. If true, that’s potentially a big deal. Building that level of recognition for a new brand of coffee — or anything else — from scratch would involve an astronomical amount of money, a great deal of time, or both.

Marketers like to talk about something called brand “equity,” a combination of familiarity and positive associations that clearly has some sort of value, even if it’s impossible to measure in a convincing empirical way. Exploiting the equity of dead or dying brands — sometimes called ghost brands, orphan brands or zombie brands — is a topic many consumer-products firms, large and small, have wrestled with for years. River West’s approach is interesting for two reasons.

One is that for the most part the equity — the idea — is the only thing the company is interested in owning. River West acquires brands when the products themselves are dead, not merely ailing. Aside from Brim, the brands it acquired in the last few years include Underalls, Salon Selectives, Nuprin and the game maker Coleco, among others. “In most cases we’re dealing with a brand that only exists as intellectual property,” says Paul Earle, River West’s founder. “There’s no retail presence, no product, no distribution, no trucks, no plants. Nothing. All that exists is memory. We’re taking consumers’ memories and starting entire businesses.”

The other interesting thing is that when Earle talks about consumer memory, he is factoring in something curious: the faultiness of consumer memory. There is opportunity, he says, not just in what we remember but also in what we misremember.

River West is a young company, and few of its ideas have been directly tested in the marketplace. The revival of Brim, for instance, has yet to crystallize into a plan with real manufacturing and distribution partners. But River West is starting to bring some familiar names back into the consumer realm. It is thanks to River West that you can buy Nuprin again at CVS. The firm has also played a role in the return of Eagle Snacks to some grocery-store aisles. In late January, Drugstore.com began accepting orders for Salon Selectives, which is also making its way into 10,000 stores, including every Rite Aid in America and grocery chains like Winn-Dixie and Pathmark. And by way of a deal with River West, Phantom, a Canadian hosiery manufacturer, is pushing a new version of Underalls to department-store and boutique clients in the U.S.

Whether these brand-reanimation efforts pan out as a successful business strategy or not, they offer an unusual perspective on the relationship between brands and the brain. By and large, examinations of successful branding tend to focus on names like Harley-Davidson, Apple or Converse, which have developed “cult” followings. Such cases are misleading, though, because they are not typical of most of what we buy. A great deal of what happens in the consumer marketplace does not involve brands with zealous loyalists. What determines whether a brand lives or dies (or can even come back to life) is usually a quieter process that has more to do with mental shortcuts and assumptions and memories — and all the imperfections that come along with each of those things.

River West’s offices, on the 36th floor of the Chicago Board of Trade Building, are sprinkled with the bric-a-brac of obscure products: a Quisp cereal box, Ipana toothpaste packages, Duz detergent bottles. On a wall of Paul Earle’s office is a framed, five-foot-by-three-foot sheet of uncut “Wacky Packages” stickers — those 1970s trading-card-size brand-parody images that rendered the word Crust in the style of the Crest logo, for example. Earle has a Midwestern everyman quality about him: he’s compact, with a big and friendly let’s-get-along voice and a penchant for deadpan jokes. Only his designer-eyeglass frames deviate from his overall demeanor.

Earle loves brands. They are not mere commercial trademarks to him, but pieces of Americana. He seems not just nostalgic but almost hurt about the fate of the “castoff brands” of the world. “If commerce is part of the American fabric, then brands are part of the American fabric,” he said to me on one occasion. “When a brand goes away, a piece of Americana goes away.”

Earle’s professional entanglement with branding began at Saatchi & Saatchi, where he was a cog in a gigantic ad agency working for gigantic clients, like General Mills and Johnson & Johnson. That was in the mid-1990s, and he saw what happened as conglomerates merged: brands that didn’t have the potential for global scale got squeezed to the bottom shelf, or out of existence. He was attracted to the idea of working with “noncore” brands, but when he figured out that big-agency economics made it impractical, he left Saatchi and went to the Kellogg School of Management at Northwestern University, and then took a brand-management job at Kraft.

At Kraft he observed the same mergers-and-consolidation process from a different angle, and he seems to have found it equally frustrating. “These are American icons with loyal consumers,” he says. “It’s not their fault a $40 billion company doesn’t like them anymore. Consumers like them.” He sees reviving brands as “a civic mission” of sorts. “If it weren’t my job,” he said, “it would be my hobby.” He says this in a way that sounds not just plausible but hard to doubt.

Even so, he has set out to make this particular civic mission turn a profit. While he recognizes that a given brand might not be able to survive in the portfolio of a multinational, different sorts of business models might work to sustain it. As surely as the ownership of brands has consolidated through one megamerger after another, the consumer market seems to be moving in the opposite direction, with an individualism-fueled demand for almost unlimited variety. Earle’s theory is that such demand means room for brands like the ones River West owns, and his idea is facing its most significant test to date, by way of the reanimation of Salon Selectives.

Helene Curtis began selling this line of shampoos in 1987, and sales shot past the $100 million mark within a year or so. It was, one Wall Street enthusiast claimed at the time, “probably the most successful hair-care launch in the history of the universe.” Heavily advertised, the brand was a pioneer of the sales pitch, now routine, of a “salon” product available for home use. Unilever bought Helene Curtis in 1996, acquiring a new batch of cosmetic, shampoo and deodorant brands that had to be integrated into those the conglomerate already offered.

It’s often hard to pin down the exact moment a brand disappears, because a product can linger on retail shelves for quite a while before it’s sold down or otherwise liquidated. But by the early 2000s, Salon Selectives had become a casualty of brand-portfolio consolidation. A few years later, River West acquired what was left of it: intellectual property like the trademarks and the original formulas.

River West’s partner in the Salon Selectives effort is called SSB, which has five full-time employees coordinating the efforts of various subcontractors (manufacturers, package-makers) out of River West’s offices. Selective Beauty is run by Gene Zeffren, a former top executive at Helene Curtis with a Ph.D. in chemistry. Earle and Zeffren are partly motivated by the belief that there is a core of Salon Selectives fans out there who miss their product and are eager to buy it again. You would think, then, that the goal would be to give those consumers their old brand back, just as it once was. And sure enough, when I visited Anne West, the chief marketing officer of the new Salon Selectives, there was an array of pink plastic bottle samples in her office, part of an attempt to match the old color as closely as possible. She showed me a video in which a surprising number of randomly confronted Chicagoans, asked if they remembered Salon Selectives, responded by singing the jingle.

Then she showed me storyboards for new Salon Selectives ads, which were not much like the original ones at all. She went on to explain that while the bottle color would be the same, its shape would be different. The reintroduced line also includes a number of new products, and the products are now more aggressively marketed as “customizable” (by hair length, thickness, texture, etc.) than they were in the earlier incarnation. Then there’s the apple scent. West said fans of the brand in its heyday frequently cited that signature smell as one of the things they missed most about the shampoos. So the new version will have an apple scent — but even that was being tweaked and “updated.” The bottom line is that Salon Selectives isn’t coming back just as it used to be, but sort of as it used to be.

West figures that fans of the brand who are nostalgic for their long-lost product just need to know that it’s back. But the real point now is to attract younger customers who probably never used the stuff. The name “Salon Selectives” might sound familiar to them, so the strategy must balance that familiarity with something that makes the product seem fresh and novel. Later West sent me the new Salon Selectives ads, now running on VH1, Lifetime and other cable networks. The Week in Review is edited and published by Jack Spratts. The spots do not announce the return of a favorite old brand, or even allude to the fact that Salon Selectives was ever gone. In one, a woman escapes from prison and immediately washes her hair. The cop who confronts her admits that she doesn’t look like an escaped con but (punch line) as if she “just stepped out of a salon.” This is followed by glimpses of the (pink) bottles and a quick “mix and match” pitch and then, at the very last second, a snippet of the familiar old jingle, rerecorded. West calls this snippet a “button,” and it clearly aims to function as the slightest mental nudge: this is something you know about.

Among River West’s various projects, this is actually one of the more conservative in testing the boundary between the positive associations of a familiar memory and the attractions of novelty. There’s less room to test that boundary because Salon Selectives hasn’t been “dormant” all that long: At least some fans of the old apple scent are going to have opinions about the “updated” version. Much will depend on specific associations with a product — which is not the same thing as a brand. Brands aren’t quite so tangible, so quantifiable. That’s what’s interesting about them.

One of Paul Earle’s professors at Kellogg was John F. Sherry Jr. (now at Notre Dame), who has devoted some study to “retromarketing” and “the revival of brand meaning.” In 2003 he wrote an article (with Stephen Brown of the University of Ulster and Robert V. Kozinets of Kellogg) on the subject for The Journal of Customer Behavior. “Retromarketing is not merely a matter of reviving dormant brands and foisting them on softhearted, dewy-eyed, nostalgia-stricken consumers,” they asserted. “It involves working with consumers to co-create an oasis of authenticity for tired and thirsty travelers through the desert of mass-produced marketing dreck.”

I wasn’t entirely sure what that meant, but Sherry turned out to be more straightforward in conversation. “There’s no real reason that a brand needs to die,” he told me, unless it is attached to a product that “functionally doesn’t work.” That is, as long as a given product can change to meet contemporary performance standards, “your success is really dependent on how skillful you are in managing the brand’s story so that it resonates with meaning that consumers like.”

The holy grail example of brand reanimation is the Volkswagen Beetle, which a few years ago rose from dormancy and became a hit all over again in an updated form that was both nostalgic and contemporary. The reintroduced Beetle layered “nostalgic reassurance” over modern functionality. “It’s a brand that’s memorable for a lot of different reasons,” Sherry said. “But largely because it evokes this past that never was — that was morally superior or simpler, an era of better craftsmanship. That kind of thing.”

Such abstract notions are much on display at the Licensing International Expo, an annual event at which the owners of cultural properties — TV shows, movies, cartoon characters — meet with makers of things and try to negotiate deals granting them a paid license to use the properties to add meaning and market value to whatever things they make. It is a good place to contemplate the business potential of “the brand” in free-floating form, unmoored to any product or company that may have actually created it. A surprising number of the symbols represented at the expo held last summer in New York were simply brand logos. Spam, for instance, had its own booth. IMC Licensing was there on behalf of its clients Oreo, Altoids, Dole and Oscar Mayer. At one point I encountered a person dressed up as a can of Lysol, which is represented by the Licensing Company.

Another firm that represents a number of consumer brands is the Beanstalk Group, which staked out a rather large chunk of floor space at the expo, complete with a coffee bar and about 20 tables. Owned by Omnicom Group, Beanstalk is the licensing firm for a wide range of cultural properties, from Harley-Davidson to Andy Warhol to the United States Army. None of these are dead brands, of course, but Beanstalk’s track record with converting brand meaning into revenue is the reason Paul Earle was at the licensing expo. Beanstalk was exploring strategies to revive the Coleco and Brim brands as, essentially, licensing fodder.

Michael Stone, the president and chief executive of Beanstalk, has a refined sense of the licensing business, and how consumer brands fit into it. He knows what many people think the business boils down to: I make plastic lunchboxes and you own the rights to reproduce images of Spider-Man. How about a Spider-Man lunchbox? Stone cheerfully explained to me that this is merely a “decorative” form of licensing, and that’s not his game. As a point of contrast, he told me about Beanstalk’s involvement with Stanley Works, the venerable maker of hand tools.

Stanley hired Beanstalk about nine years ago. Stanley conducted “consumer permission research” to try to determine where the Stanley brand could go. “I remember looking through the focus-group tests, and there was a guy who absolutely swore that he had a Stanley ladder in his garage.” Stone paused. “Stanley never made ladders.” This is an excellent example of what “brand equity” really means in the marketplace.

In contrast to the fanatical-devotion theory, part of the point of most branding is very specifically to circumvent conscious thought. Psychologists use the word “heuristics” to refer to the mental shortcuts and rules of thumb that allow us to resolve the various routine problems of everyday life without having to make a spreadsheet for every trivial decision. Brand owners want a way into your purchase heuristics. Often it is not so much a matter of, say, a Stanley Works fanatic seeking out all products bearing that trademark; it’s a matter of looking for a product and choosing one with a particular trademark that, for whatever reason, we find acceptable. This is not brand loyalty. It’s brand acquiescence.

We’ve all seen the Stanley name, for instance. And by and large, we trust it. We have a general idea of Stanley that fits into our hardware-store purchase heuristics. But there is a great deal of imperfection and vagueness in these thought processes, and that is good news for a licensor. It suggests that there’s potential — or “permission” — for the Stanley name to migrate onto new products.

What Beanstalk did not do when it took on Stanley as a client was recommend investing in a ladder-production facility and hiring a bunch of workers, plus a sales force to blitz potential retail channels. Stanley Works, as a company, has actually been moving in the opposite direction, closing factories and outsourcing its manufacturing since the 1980s. Instead, Beanstalk worked out a licensing deal with Werner, which was already the biggest maker and distributor of ladders in the country. “They needed another brand because they couldn’t expand the Werner brand anymore,” Stone said. So Werner started making and selling ladders with the Stanley name on them. This gave Werner a way to get more shelf space, reach more consumers and make more sales. What it gave Stanley was its name on a new product and a licensing fee. Beanstalk has worked out many such deals, hooking up the Stanley brand with manufacturers of work gloves and boots, power generators and a variety of other things that Stanley never made (and does not make now).

Too many such deals, or the wrong kinds, can boomerang: this happens with some regularity in the fashion world, when a famous designer name gets spread over so many products, with so little regard to quality, that the entire image of the brand sinks. Still, if you see a ladder made by Stanley, you may well think, Well, there’s a name I can trust. What you’re trusting, though, isn’t Stanley workers in Stanley factories upholding Stanley traditions and values under the watchful eye of Stanley managers. What you’re trusting is Stanley’s recognition that a badly made ladder with the Stanley name on it could be highly damaging to the Stanley brand. You are trusting Stanley’s recognition of the value of its brand and its competence in defending that value.

We circled back around to Beanstalk’s ideas for River West’s brands, particularly Brim. Stone mentioned White Cloud. White Cloud is a brand of toilet paper once owned by Procter & Gamble. P.& G. also owned the Charmin franchise, so eventually it let the trademarks on White Cloud expire. These were then acquired by an entrepreneur, who worked out a licensing deal with Wal-Mart to make White Cloud an exclusive Wal-Mart product. It became, essentially, a store brand, but infused with equity of mass-market familiarity. It’s very doubtful that the typical White Cloud buyer is aware that the product is available only at Wal-Mart. It’s also very doubtful that P.& G. (which would surely prefer that its Charmin didn’t have to compete against a brand that P.& G. itself created) will let anything like that happen again if it can possibly help it.

This is essentially the situation that River West brokered with the Nuprin brand, which was a dead line of ibuprofen painkillers (once upon a time backed by the widely known “Nupe it” ad campaign). Its trademarks were acquired by River West and sold to CVS, where it is back on the shelves as a stealth store brand. (And presumably enjoying better margins than it would if, like a traditional store brand, it competed solely on low price, not trustworthy-brand familiarity.) My read was that this is what Stone thought should happen to Brim — and that Earle had mixed feelings, believing, perhaps, that Brim could come back as something bigger. Even Stone seemed at least somewhat intrigued with the possibilities of licensing a brand that was familiar but dead. “With Stanley we have to be careful — this is a famous brand; we have to do everything right and mitigate all the risks,” he says. “But with Brim, the risks. . . .” He paused. “There really are no risks.”

This brings us to Earle’s ideas about the potential upside of faulty consumer memory. Maybe, for instance, you’re among those who remember Brim. But do you also remember that it was a decaf-only brand? That’s actually why you could “fill it to the rim.” River West’s research found that many who recall the Brim brand have forgotten the decaf detail.

The relationship between brands and memory (faulty or no) is a specialty of Kathy LaTour, an associate professor at the University of Nevada, Las Vegas. In one of her most interesting studies, she worked with Elizabeth Loftus, a memory specialist and now a professor at the University of California, Irvine, and a third researcher, Rhiannon Ellis, to take the issue to its logical extreme: What if, for example, an advertising campaign “implanted memories into consumers of things that never happened?”

The researchers found that subjects presented with a fake Disney World ad inviting them to “remember the characters of your youth: Mickey, Goofy . . . ” were significantly more likely to say they recalled that as children they had met “a favorite TV character at a theme resort” than those who didn’t see the ad. The fascinating thing was what happened when they repeated the experiment, tweaking the ads to include Bugs Bunny, who, of course, is not a Disney character at all. About 16 percent of subjects subsequently claimed that, as children, they shook hands with Bugs Bunny at a Disney theme park. Repeated fake-ad exposure apparently led to higher false-memory rates. In a separate study, Loftus asked subjects with Bugs in their memories what, exactly, they recalled about this incident; of these, 62 percent recounted shaking Bugs’s hand, and more than a quarter specifically recalled him saying, “What’s up, Doc?”

Earle says that this imperfection of memory can be used to enhance whatever new Brim he comes up with. This is “a benefit of dormancy,” he says. The brand equity has value on its own, but it can be grafted onto something newer and, perhaps, more innovative. “Consumers remember the kind of high-level essence of the brand,” he says. “They tend to forget the product specifics.” This, he figures, creates an opening: it gives the reintroduced version “permission” to forget that decaf-only limitation as well and morph into a full line of coffee varieties. “ ‘Fill it to the rim with Brim’ stands for full-flavored coffee,” Earle says, with a chuckle. “Fill it to the rim — it’s great stuff!”

Finding the deceased brands that consumers are likely to remember — sort of — is a process that can begin, of all places, in the library. Earle spent hours going through old issues of People, Time, Glamour and other magazines, “looking for brand names that sounded familiar but that I hadn’t seen lately.” This results in many, many possibilities that don’t work out for one reason or another. But every so often the process yields an Underalls.

Earle was intrigued with Underalls. Produced by Hanes from about 1975 to the mid-1990s, Underalls was once a prominent brand, advertised aggressively. (“O.K. America — show us your Underalls!”) It spawned “flanker” brands like Summeralls, Winteralls and Slenderalls. It was unique and memorable: a good brand. “You see the memorabilia on eBay,” Earle says. “That’s usually a good indicator.”

By way of MarketTools, a research company, River West asked 1,000 women ages 25 to 54 to answer an online survey about hosiery brands. About 850 did so, and among these, 72 percent had heard of Underalls. Among those who recognized the brand, about three-quarters remembered the “Show us your Underalls” tagline. Promising. But River West needed a partner to actually manufacture and distribute whatever the new version of Underalls might be.

It found that partner in Phantom, a hosiery maker based in Toronto. Phantom’s main product line is called Silks, the dominant hosiery brand in Canada. The company also manufactures a number of store brands. Phantom wanted to get into the crowded U.S. hosiery market, says Svetlana Sturgeon, vice president of sales and marketing for Phantom, and it made a certain amount of sense to leverage a name far more familiar to American consumers than Silks would be. Sturgeon jokes that, at first, she did not want to admit at meetings that she remembered the brand (“I’m much too young for that!”). But she did.

The point of the original Underalls was that they combined panties and stockings into one undergarment. (“They were the pioneers in the whole idea of eliminating panty lines,” is how Sturgeon puts this.) In early brainstorming sessions, Phantom and River West tried to come up with “the most expansive but credible definition” of the brand, Earle says. In this case that turned out to be “intimate-apparel solutions,” which means anything you wear under something else that’s “functional and fashion-forward,” Sturgeon says. This includes camisoles and bras and other things the original Underalls never sold. The San Francisco design firm Thinc came up with a new graphic identity and packaging ideas that referenced classic elements of the old ads, but radically updated them. New slogan: “Lovely underneath it all.” With the prototypes complete, Sturgeon has begun the process of meeting with boutique and department-store buyers, in the hope of getting products into stores, at least on a test level, in the fall.

Brand familiarity alone guarantees nothing. Sears owns several well-known brand names — Kenmore, Craftsman, DieHard, the Sears name itself — and is viewed by Wall Street as a basket case. Multinationals routinely go through cycles of acquiring and creating brands and then paring back when, inevitably, some underperform. A tiny number of hard-core loyalists not only doesn’t mean a whole lot when reviving a brand, it might be a problem because those people do remember. A number of the more cultish devotees of the VW Beetle, in fact, forthrightly rejected its reanimated version as a fraud. In that case, those consumers were marginalized by a far wider buying public who weren’t such sticklers.

And really, something like the Beetle is actually a special case: it wasn’t just a well-known product, it was a cultural icon on a level that very few products or brands ever achieve. River West is trying to reanimate brands that are sort of familiar but don’t have anything like a VW level of built-in cultural capital to draw on. If there is a cult of Brim out there somewhere, it’s pretty small and very quiet.

What River West really wants is to bring back these brands in a way that not only builds on their former popularity but also manages, via the skillful management of what we do remember and what we don’t, to transcend it. This would be quite a trick. A few months after he returned from the licensing expo, Earle more or less dropped the strategy of turning Brim into a glorified store brand. These days he’s talking about finding a “really innovative” coffee-manufacturing partner who could make the Brim brand an umbrella for groundbreaking (but unspecified) coffee advances that would work in the general market, not just one chain. He sounded almost protective of the Brim idea, and possibly a bit frustrated that he hadn’t hit on the way to bring it back. “Brim is, within our company, one of our best-known brands,” he said to me at one point. “In fact it’s our absolutely best-known brand. So expectations are high.”

Later he added: “The strength of a dormant brand is we can remake this however we want. The challenge is we can remake this however we want.”

Eventually, Earle introduced me at his office to Scott Lazar, chief executive of another River West partner, Reserve Brands, which is overseeing the revivification of Eagle Snacks. I’d never heard of the brand, but I was assured that plenty of Midwesterners knew it. Eagle had once been owned by Anheuser-Busch and was the beer maker’s way into the salty-snack market dominated by Frito-Lay. Its most well known product, it seems, was the honey-roasted peanut, particularly in tiny bags given out as snacks on airlines. Anheuser-Busch eventually pulled the plug, selling its equipment to Frito-Lay and the trademarks to Procter & Gamble in the mid-1990s. Lazar said that while the new Eagle has acquired those trademarks, the new and expanded product line consists largely of snacks that the old Eagle never made, with names like “Poppers!” and “Bursts!” These are rolling out in a variety of grocery stores across the country. Lazar tried to give me about six large bags of samples, but I demurred on account of limited luggage space.

I ended up with two bags, which Earle and I took downstairs to the bar at the Ceres Cafe. It was crowded and loud, filled with big Chicago men who in some cases had spent the day screaming on the Chicago Board of Trade floor and who in all cases were not shy. We found a place to sit, plopping the Eagle snacks in front of us. And one man after another leaned into our space and pointed at the bags and boomed, “Eagle!” Big hands reached toward the bags to get a scoop of snacks that the old Eagle had never made, and at the time were not in stores, and big voices declared, “I remember those!”
http://www.nytimes.com/2008/05/18/ma...l?ref=magazine





Guessing the Online Customer’s Next Want
Eric A. Taub

Marketers have always tried to predict what people want, and then get them to buy it.

Among online retailers, pushing customers toward other products they might want is a common practice. Both Amazon and Netflix, two of the best-known practitioners of targeted upselling, have long recommended products or movie titles to their clientele. They do so using a technique called collaborative filtering, basing suggestions on customers’ previous purchases and on how they rate products compared to other consumers.

Figuring that out is not so easy. For one thing, people do not always buy what they like. Someone may buy a sweater for their grandmother even though they dislike it and would never get it again. Similarly, a person who rents a movie may actually detest it but knows her child likes it. Or a film that was seen on a small airplane screen may garner a lower rating than if it were seen at a large multiplex.

The search for a better recommendation continues with numerous companies selling algorithms that promise a retailer more of an edge. For instance, Barneys New York, the upscale clothing store chain, says it got at least a 10 percent increase in online revenue by using data mining software that finds links between certain online behavior and a greater propensity to buy.

Using a system developed by Proclivity Systems, Barneys used data about where and when a customer visited its site and other demographic information to determine on whom it should focus its e-mail messages.

For instance, an e-mail message announcing sales might go to those Web site visitors who had purchased certain products or types of products in the past, but who had done so only when the items were on sale. In the simplest terms, if someone buys only when something is on sale, but never buys anything in December, then the e-mail sale flier might not be sent to that customer in December. “There is a digital trail of interest left by customers,” said Sheldon Gilbert, Proclivity’s chief executive and founder.

The observation about sales could be integrated with other behavior. Does the customer buy only when an item reaches a certain price? Is the customer more likely to buy on a weekend or during the week? Must it be organic material? An algorithm would weigh those behaviors to determine the likelihood that someone will open the e-mail message, and once opened, decide to click through to the site and buy the product. The more data, the better it gets at predicting, says Proclivity, which is based in New York.

“One customer found that 10 percent of its population accounted for 60 percent of bargain sales. So on the day of the sale, you can send a full-price ad to everyone else,” said Mr. Gilbert.

Barneys experienced at least a 10 percent increase in online revenue, as compared to control groups, said Larry Promisel, Barneys’ vice president of e-commerce. It found 20 percent more customers would purchase once sent the targeted e-mail messages. The company has saved money by not sending e-mail letters to customers unlikely to buy.

Not only are sales increasing, Mr. Promisel said, but with the store focusing on customers with items they are likely to buy, its clientele feels that it understands their interests, which increases good will.

Still, the problem of knowing what people want is hardly solved. While Netflix has persuaded almost five million subscribers to provide two billion movie ratings to its site, the company still has trouble figuring out exactly what somebody will like.

“I wish I could tell you that our recommendations system was reliable, but it’s not perfect,” said Reed Hastings, Netflix’s chief executive.

At best, Netflix knows that if someone rates a particular drama highly, it can predict what other drama they might like by correlating one’s rating of that film with others. “But if I know your taste in drama, I do not know your taste in horror,” Mr. Hastings said.

As customers value selection and rapid delivery more than recommendations, the company is not that worried about its prediction system. Even a 10 percent improvement of its ratings system has not been possible. Netflix has offered a $1 million prize to anyone who can do that, but to date, only slightly better than a 9 percent improvement has been achieved.

“Using as much information as you can is very important,” said Yehuda Koren, an AT&T Labs researcher, who was part of the group that achieved the results. To do even better, Mr. Koren would “track all clicks, the movies that people searched for, the pages they jumped to, their mouse movements,” information that Netflix does not now collect.

Doing this type of analysis, Mr. Gilbert of Proclivity believes, would stop retailers from sending out buying recommendations based on outdated information.

“I still get e-mails from Amazon recommending books based on the Jared Diamond titles I bought three years ago,” he said. “But I get nothing about my interest in gardening.”
http://www.nytimes.com/2008/05/19/te...recommend.html





Macs Defy Windows' Gravity

Consider this: Apple's retail market share is 14 percent, and two-thirds for PCs costing $1,000 or more.
Joe Wilcox

Should I repeat those numbers? The share data is for first-quarter brick-and-mortar stores, as tabulated by the NPD Group. Apple's market share is but one measure of success. Sales growth is way up, while Windows desktop PC sales are way down.

"In notebooks they're growing two times the market," said Stephen Baker, NPD's vice president of industry analysis. "Windows notebooks are pretty much flat right now."

For the first quarter, Windows notebooks had "zero percent" growth year over year, Stephen said. By comparison, Apple notebooks had "50 to 60 percent growth."

On the desktop, "They're up 45 percent," he continued. "The [overall] market is down 20 percent. Windows desktops would be down 25 percent." The figures are also for first quarter.

I spoke with Stephen earlier this afternoon. He remarked: "iMacs are growing and the Windows desktop ain't. No matter how you look at it, Apple is outperforming Windows."

A statement like that raises the question: Is Windows Vista the problem? The operating system has met with a cool reception, even with Microsoft claiming 140 million licenses have been shipped.

"I don't believe that Vista's to blame," Stephen responded. "The vast majority of consumers don't care [about the installed operating system]."

Apple's market share in what NPD calls the "premium" category, or laptop and desktop PCs selling for $1,000 or more, is nothing short of phenomenal: 66 percent. That's right, two-thirds.

With the exception of the Mac Mini, all Apple computers sell for more than $1,000. "If you don't give people a choice, people will spend more," Stephen said.

Apple's success above $1,000 defies some of the conventional retail thinking about PCs, where the emphasis is on lower pricing and greater features. "Consumers don't care about features," Stephen asserted. "People see a value proposition in an offering that gives them a great experience."

Stephen said Apple appeals to the right segments, like multiple-computer households. Consumers that are buying a second, third or even fourth PC have different buying priorities, such as ease of use.

But the retail stores make a huge difference. "Apple has got better distribution than it's had in the last 15 years," Stephen explained. "They're in the right spot right now. There's the iPod advantage. But the big thing is the stores."

Apple's retail stores aren't just places to buy Mac products. They're part of a larger end-to-end value chain—and with it the promise of a certain kind of experience.

"What Apple drives home: This is a product that we own from factory to finger," Stephen explained. "We exert some control so that you get the best experience. When you get in the store, we get you what you want."

Apple's factory-to-finger approach works for its own retail operations, but what about what Stephen called its "non-captive channels," such as Best Buy? That's where Apple has to compete with many other products. "They've already won when somebody comes into the Apple Store," Stephen said. "How does it play in places where they're not the only answer? How big a handicap is Windows?"

Stephen didn't have an answer, but it's not difficult to guess: not nearly as well in third-party retail shops as through the Apple Store.

Given Apple's end-to-end success—from product conception to production to sale to service—I asked Stephen if Microsoft should open its own company stores, even if only a few flagship ones like Nokia.

"Yes," he said emphatically. "In a multi-hannel enviroment you should have some kind of owned--and operated--channel as well." He cited a couple examples. One of them: "When you look at Coach they have their own showcase stores as well."
http://blogs.eweek.com/applewatch/co...s-gravity.html





The Computer Industry Comes With Built-In Term Limits
Randall Stross

MATHEMATICIANS have long tried, and failed, to solve the Riemann Hypothesis, a stubbornly unyielding math problem. Good luck to whoever tries to figure it out. For the first correct proof, a $1 million prize will be awarded by the Clay Mathematics Institute.

Similarly, two successive Microsoft chief executives have long tried, and failed, to refute what we might call the Single-Era Conjecture, the invisible law that makes it impossible for a company in the computer business to enjoy pre-eminence that spans two technological eras. Good luck to Steven A. Ballmer, the company’s chief executive since 2000, as he tries to sustain in the Internet era what his company had attained in the personal computing era.

Empirical evidence, however, suggests that he won’t succeed. Not because of personal failings, but because Mother Nature simply won’t permit it.

It’s unfortunate, as a $300 billion prize could be collected by Microsoft shareholders: that would be the increase in market capitalization, should the share price return to its high of $59.56, attained in 1999, from its current price of $29.99. (Maybe this was why Mr. Ballmer flirted with Yahoo.)

That prize, however, seems a mirage. You can’t merge-and-acquire your way around the Single-Era Conjecture. Just ask I.B.M., which gobbled up Lotus Development Corporation to no avail.

The Yahoo affair obscures the larger story: Microsoft’s long, long struggle — since 1993 — to maintain its leadership position while the Internet grew ubiquitous. Mr. Ballmer, who joined Microsoft in 1980 as its 15th employee, and Bill Gates, his mentor who will retire next month as a full-time Microsoft employee, have certainly tried their best to avert the inevitable decline of the company’s influence.

In 2000, Mr. Ballmer credited Mr. Gates for noting that no company in the computer business had ever stayed on top through what Mr. Gates called “a major paradigm shift.” The two men wanted Microsoft to be the first company to achieve that goal. An interesting challenge, but some problems are of a size that dwarf the abilities of multibillionaire mortals.

In a 1995 internal memo, “The Internet Tidal Wave,” Mr. Gates alerted company employees to the Internet’s potential to be a disruptive force. This was two years before Clayton M. Christensen, the Harvard Business School professor, published “The Innovator’s Dilemma: When New Technologies Cause Great Firms to Fail” (1997). The professor presented what would become a widely noted framework to explain how seemingly well-managed companies could do most everything to prepare for the arrival of disruptive new technology but still lose market leadership.

It’s Google, of course, that has developed the musculature to step forward and lay claim to being Microsoft’s successor as industry leader in the Internet era. If there had been any way Microsoft could have prepared for this day, it had ample time to do so. In 1993, fully five years before Google’s founding and two years before Mr. Gates’s memo, Nathan P. Myhrvold, then Microsoft’s chief technology officer, wrote his own memo, “Road Kill on the Information Highway.” It spelled out in prescient detail how each of many industries would be flattened by the build-out of digital networks, and it said that the PC software business would be no exception.

It’s no secret that Microsoft’s online businesses have failed to gain leading market positions. But what is not widely appreciated, perhaps, is that the company’s online initiatives have lately been doing worse than ever.

The last year when Microsoft made a profit in its online services business was the fiscal year that ended on June 30, 2005. Its MSN unit used to do a nicely profitable business providing dial-up Internet access to subscribers. When its users began to switch to broadband services provided by others, however, the earnings disappeared. Microsoft’s Web sites brought in a trickle of advertising revenue, which did not grow fast enough to offset the disappearance of the narrowband access business. AOL suffered in similar fashion.

In the 2006 fiscal year, Microsoft’s online services produced a $74 million loss after the previous year’s profit of $402 million. Since then, the numbers have become uglier, as Microsoft’s online segment has added employees and absorbed growing sales and marketing expenses. In the 2007 fiscal year, the online businesses lost $732 million. In the next nine months, through March 31 this year, they recorded a loss of $745 million, almost double the amount in the period a year earlier. With $2.39 billion in revenue for the nine months, the online segment represents only 5 percent of the company’s total revenue.

The numbers at Google, which is nothing but an online services business, have moved in the opposite direction. For rough comparison, profits in its 2005 fiscal year, ended on Dec. 31, were $1.5 billion. The earnings grew to $3 billion in 2006 and $4.2 billion in 2007.

According to Hitwise, an Internet research firm, Google’s share of searches in the United States has increased to almost 67.9 percent in March 2008 from 58.3 percent in March 2006. During the same period, Microsoft’s share has dropped to 6.3 percent from 13.1 percent.

Mr. Ballmer has always been a ham on stage. His comically demonic chants and dances in recent years have been preserved on YouTube. But even way back in the day, he had the gift. At the company’s annual meeting in 1994, when he was overseeing sales and Microsoft was enjoying its moment of triumph over competitors, he shouted at top volume: “It’s market share — market share! market share! market share! — that counts!” He continued: “Because if you have share, you basically leave the competitors” — here he grabbed his own throat for emphasis — “just gasping for oxygen to live in.”

His mock asphyxiation of competitors was later stripped out of its jokey context by government antitrust lawyers. But the imagery is no less apt now than it was then, except that the roles have reversed. As Google continues to gather market share and the Single-Era Conjecture dictates Microsoft’s eclipse, it is Mr. Ballmer’s own online services that now are gasping for oxygen.
http://www.nytimes.com/2008/05/18/te...gy/18digi.html





PC-Windows Bundling, First Hearing at TGI in Paris : UFC Que Choisir Against Darty
Last modified: 05/17/2008 02:38 PM

Ironically, as the hearing for the first out of three assignements introduced by French consumer association UFC-Que Choisir against systematic sale of pre-installed Windows with Personal Computers was held in Court in Paris, we learned that manufacturer Asus was condemned in Caen, Normandy (case Hordoir vs. Asus, 30 April 2008) to reimburse the client for unwanted software licences. While the judgment in Paris is pending, this decision should encourage computer manufacturers to reimburse clients more willingly, otherwise they might be subjected to frequent assignement and condemnation, given the success obtained by the Reimbursement Guide published recently by the "Racketware" team.

Today, in Court in Paris (at Tribunal de Grande Instance), was held the first hearing in the series of trials that oppose consumer association UFC Que Choisir and companies accused of violating several articles of the French Consumer Code, in particular Article L.122-1 that prohibits bundled sales.

Complaint by UFC Que Choisir

Let us recall the facts : when consumers buy the computer of their choice, they are generally forced to simultaneouly acquire the license of pre-installed software, even though it would be easy for the professionals to dissociate both purchases, for a marginal cost [1], as recommended by the Globalisation Institute, a liberal reflection group, in a report for the European Commission [2]. This dissociation would also dissolve the lack of publicity for the software prices and conditions of use. Moreover, it would induce an evolution of software licenses, considered to be unfair and to contain abusive terms [3].

Encouraged by the Director General of the DGCCRF at the time, Mr. Cerruti, at a tripartite meeting in November 2006 [4], this trial is intended to provide a jurisprudence related sales of computers and software. The recent response by Luc Chatel to a written question confirms this need: the Secretary of State said he will not do anything [5].

New victory by an individual: confirmed liberty to choose one's software.

Happy coincidence: on the eave of this hearing, an individual won a new trial in Caen, Normandy. He obtained a posteriori reimbursement of pre-installed software.

The judgement recalls the client's "right and liberty to adopt any particular operating system or use other software and licenses than the systems and software installed by [the manufacturer] on the computers."

One of the jurists in the Racketware team that edits the Reimbursement Guide, comments : "The obstacles introduced by the manufacturer to a simple and fast reimbursement of an amount corresponding to usual prices are clealy condemned by the judge. Asus' practice can thus be assimilated to bundled sales [6]. The manufacturers, and hence, the vendors, will need to revise their practices if they do not want to undergo more frequent appeals."

This is the fourth victory in a proximity juridiction (Rennes, Puteaux, Libourne, Caen). This victory is the first of a long series of procedures [7] conducted along the lines of the http://racketiciel.info/ Reimbursement Guide [8] which meets great success [9].

What is the consumers' opinion?

Petition "Stop racketware" [10] will soon reach 30 000 signatures, which is surprising for a complex matter with so little coverage in traditional media.

Meanwhile, Vista is increasingly rejected. The consumer prefers keeping XP and manufacturers HP and DELL attempt to find way to revive this system to meet demand. As for Microsoft, she receives the timely payment for the Vista license anyway. Only the consumer is the looser : he must pay for software he is not using!

Does the consumer wish anything else than Microsoft products? With bundled sales, he is rarely entitled to speak. Yet EeePC, by the same manufacturer, ASUS, meets a tremendous success: the public chooses an innovative machine that runs a free operating system [11].

What Justice can achieve

The French executive power is schizophrenic. On the one hand, "the State has no more money". On the other hand, according to our estimations, Microsoft tax optimization in France, artificially swollen by bundled sales, is on the order of twice the annual cost of the national family card for train transportation. By ignoring bundled sales, not only does the State act against the consumers' interest, but it comforts the monopoly of the editor that controls from 90 to 95% of market shares [12]. A clear court settlement on bundled sales could compensate for the State's lack of action.

Despite what vendors and manufacturers pretend, the solutions we suggest (identical pre-installation for all copies of a model, but selective activation upon client's request) have a minimal cost, they are simple and fast to set up [1]. A clear court settlement on bundled sales would cut manufacturers' dilatory arguments.

Besides, bundled sales illustrates a real problem in France: the law exists and only needs to be enforced. A clear court settlement on bundled sales would re-delineate the spirit of the law where it has been continually eroded by the influence of manufacturers and vendors for their exclusive profit.

Live from Paris Tribunal de Grande Instance

Today's hearing shows that the result of this action mainly relies on the Court's decision. It should be noted that Darty's representents seem to exempt the vendor from its responsibilities regarding customers, just as today's State Secretary Luc Chatel eludates his responsibility [13]. Associations AFUL and April celebrate the quality of the pleading by UFC-Que Choisir representents, which included several key arguments from the Racketware team.

Alain Coulais, one of the leaders of the Racketware workgroup, says: "With a victory at Tribunal de Grande Instance, the current situation, which is unfavourable to all consumers, will evoluate towards optionality during the purchase, which is favourable to all consumers and to the State. For a marginal cost, everyone would be winning: the majority that still wants to buy a machine with pre-installed software, the growing minority that knowingly chooses alternative solutions like GNU-Linux, and those who have acquired licenses that entitle them to re-use the software on several machines".
http://www.aful.org/communiques/court-paris-ufc-darty





Vista Laid Low by New Malware Figures

27 percent of PCs running Vista compromised by at least one piece of malware
John E. Dunn

It looks as if Vista's reputation for improved security could be heading for the pages of history. PC Tools has renewed last week's attack on the platform with new figures that appear to back up its claim that Vista is almost as vulnerable as its predecessors.

According to analysis from the Australian company's ThreatFire user base, 58,000 PCs running Vista were compromised by at least one piece of malware over the six months to May 2008, equivalent to 27 percent of all Vista machines probed. Vista made up 12.6 percent, or 190,692, of the 1,513,502 machines running Windows in the user base.

In total, Vista suffered 121,380 instances of malware from its 190,000 user base, a rate of malware detection per system is proportionally lower than that of XP, which saw 1,319,144 malware infections from a user base of 1,297,828 machines, but it indicates a problem that is worse than Microsoft has been admitting to.

Only a week ago, PC Tools revealed that Vista was as likely to be hit with software vulnerabilities as Windows 2000, a claim that was denied by a Microsoft staffer in a blog.

The problem with the figures given in all cases is that it is still hard to make direct - and therefore meaningful - comparisons. As PC Tools makes clear, that malware was detected did not mean harm had been done, simply that Vista's own security had in some way been circumvented to the degree that its ThreatFire tool stepped in.

"It is important to highlight that all systems used in the research pool were at the very least running PC Tool's ThreatFire and that because the technology is behavioral-based, the data refers to threats that actually executed and triggered our behavioral detection on the client machine", said PC Tools' CEO, Simon Clausen, before aiming a kick at Microsoft's own security software.

"Furthermore, in response to alternative research from Microsoft's Malicious Software Removal Tool, PC Tools highlights that the MSRT is not a comprehensive anti-virus scanner, but a malware removal tool for a limited range of "specific, prevalent malicious software."

An obvious objection to this is that any operating system will suffer a degree of malware compromise, which could be traced back to a variety of issues including user behavior. The acid test for Vista will be its ability to resist serious attacks over the longer term, something it has so far managed to do. However, the figures do suggest that malware writers are mastering the OS, a possible sign of trouble to come

PC Tools has publicized details of some of the malware types it has found on Vista systems during its scans, including three pages of variants based on Trojan.Agent, a few of which were described as serious.

At time of writing, Microsoft had not responded to PC Tools' allegations.
http://www.computerworld.com.au/inde...0;fp;16;fpid;1





Permanent Denial-of-Service Attack Sabotages Hardware

Researcher to demonstrate a permanent denial-of-service (PDOS) attack that remotely wipes out hardware via flash firmware updates
Kelly Jackson Higgins

You don’t have to take an ax to a piece of hardware to perform a so-called permanent denial-of-service (PDOS) attack. A researcher this week will demonstrate a PDOS attack that can take place remotely.

A PDOS attack damages a system so badly that it requires replacement or reinstallation of hardware. Unlike the infamous distributed denial-of-service (DDOS) attack -- which is used to sabotage a service or Website or as a cover for malware delivery -- PDOS is pure hardware sabotage.

“We aren't seeing the PDOS attack as a way to mask another attack, such as malware insertion, but [as] a logical and highly destructive extension of the DDOS criminal extortion tactics seen in use today,” says Rich Smith, head of research for offensive technologies & threats at HP Systems Security Lab.

Smith says a PDOS attack would result in a costly recovery for the victim, since it would mean installing new hardware. At the same time, it would cost the attacker much less than a DDOS attack. “DDOS attacks require investment from an attacker for the duration of the extortion -- meaning the renting of botnets, for example,” he says.

Smith will demonstrate how network-enabled systems firmware is susceptible to a remote PDOS attack -- which he calls “phlashing” -- this week at the EUSecWest security conference in London. He’ll also unveil a fuzzing tool he developed that can be used to launch such an attack as well as to detect PDOS vulnerabilities in firmware systems.

His so-called PhlashDance tool fuzzes binaries in firmware and the firmware’s update application protocol to cause a PDOS, and it detects PDOS weaknesses across multiple embedded systems.

The danger with embedded devices is that they are often forgotten. They don’t always get patched or audited, and they can contain application-level vulnerabilities, such as flaws in the remote management interface that leave the door open for an attacker, according to Smith. And remote firmware updates aren’t typically secured, but rather set up to occur by default.

Smith says remotely abusing firmware update mechanisms with a phlashing attack, for instance, is basically a one-shot attack. “Phlashing attacks can achieve the goal of disrupting service without ongoing expense to the attacker; once the firmware has been corrupted, no further action is required for the DOS condition to continue,” he says.

But HD Moore, director of security research for BreakingPoint Systems, says a more effective attack than waging a DOS on firmware would be to deliver malware. “It seems like if you can do a remote update of firmware, it would better to deliver a Trojan'ed firmware image, instead of just a DOS,” Moore says.

Meanwhile, Smith says he’s not aware of any phlashing PDOS attacks in the wild to date, but there are a few precautions to protect against these attacks. “Unfortunately, there isn't a magic bullet, but making sure the flash update mechanisms have authentication so as not just anyone can perform an update is a start,” Smith says. “Beyond this, flash update mechanisms need to be designed with malicious attacks in mind.”

Smith has no plans yet for releasing his PhlashDance tool.
http://www.darkreading.com/document....WT.svl=news1_1





Apple iTunes Targeted by Phishers
Robert Vamosi

We've seen banks, even eBay and PayPal, all targeted by phishers. Now they've turned their attention to iTunes, creating a bogus site that reportedly looks like an iTunes billing page asking for current credit card information.

"We've never seen Apple as the target," Proofpoint's Andrew Lochart told Computerworld on Tuesday. "It's probably indicative that the bad guys see Apple's online presence as large enough to be a target."

In addition to asking for credit card information, the phony iTunes page also asks for one's social security number and mother's maiden name.

In general, if you receive an e-mail with a link to a site requesting personal financial information, be very cautious about proceeding. Bookmark or type in the URLs for sites containing financial information, such as your bank or e-commerce sites like iTunes. Never link directly from an unsolicited e-mail.
http://news.cnet.com/8301-10789_3-9949507-57.html





Japan Cracks Down on Virus with Copyright Law
Yuri Kageyama

A student who allegedly spread a computer virus was convicted Friday of copyright infringement in a case that has highlighted the lack of laws in Japan to police cyberspace.

Masato Nakatsuji, 24, a graduate student at Osaka Electro-Communication University, was charged with maliciously spreading a virus by embedding it in an image from a Japanese animation film he illegally copied and distributed.

The virus he allegedly used, the "Harada virus," is one of Japan's top viruses, and Nakatsuji's arrest in January was the first in Japan involving the making or spreading of viruses.

Downloading the Harada virus and the image destroyed data on victims' computers and moved information stored on their computers onto the Internet, according to police.

Nakatsuji was found guilty in Kyoto District Court Friday and received a suspended sentence of three years.

Police considered other charges, including damage to property and obstructing business, before deciding that copyright violation charges would hold up best in court.

Nakatsuji did not contest the charge, police say. His lawyers argued for a fine instead of jail time, saying it was unfair to penalize Nakatsuji more heavily because a virus was involved in the copyright violation, Japanese daily newspaper Mainichi reported.
http://seattlepi.nwsource.com/busine...ter_virus.html





Spain Arrests 'Prolific' Hackers

Spanish police have arrested five hackers they describe as being among the most active on the internet.

The hackers, who include two 16-year-olds, are accused of disrupting government websites in the United States, Asia and Latin America.

Police say they co-ordinated attacks over the internet and hacked into 21,000 web pages over two years.

The inquiry began in March after a Spanish political party's site was disabled after the Spanish election.

The five were arrested in Barcelona, Burgos, Malaga and Valencia.
http://news.bbc.co.uk/go/pr/fr/-/2/h...pe/7406260.stm





Annoying Software: a Rogues' Gallery

Which software is guilty of annoying us the most? Here's an identity parade of the chief suspects.
Rupert Goodwins

No gain without pain?

The internet has brought us many joys. It's rewritten the rules of business and pleasure.

And pain. For it allows what may have seemed like bright ideas at the time ('let's use it to make sure our customers have the latest software', for example) to turn into a stinking pit of misery — usually, but by no means always, after marketing gets its fangs in.

Here are just ten of the guilty parties who try to do the impossible: to make us hate the internet and wish it had never been invented — and who very nearly succeed.

Adobe Reader
What does Adobe Reader do? Displays PDF pages. How does it do it? With as much bloody-minded bureaucracy, delay and needless interaction as possible. Perhaps it's because we humans have been spoiled by books, where the gap between wanting to read something and reading it is as short as the time taken to lift the cover. But Reader's incessant updates (demanding you reset your computer — why?), thundering great list of modules to load, and hour-glass-provoking pauses for thought have given Portable Document Format a reputation for being as welcome as a flatulent camel in the kitchen.

Which is a shame, because other lightweight PDF readers seem to manage perfectly well.

Apple
Oh, Apple. You created a domain where humans came first. You took usability and distilled it into an art form. Now look at you. iTunes is a music player the size of a fat-bottomed whale that gobbles resources like krill. It spends half its time trying to sell us stuff and the other half trying to stop us using it. But that's not as bad as your auto-update policy: slipping us stealth copies of Safari under the cover of important version updates to iTunes and Quicktime — what is this, Make Microsoft Look Good day?

Windows Update
Your machine will reset in four minutes. Your machine will not shut down until these five updates are installed. You must restart your machine now. You will install Microsoft Genuine Advantage. Please wait while these updates are installed. Please shut down all applications before applying this update. Pop! New updates are ready to be installed. And now that we've stopped you doing whatever it was you were doing (like we care), shall we go ahead and install them now, or would you rather be interrupted yet again later?

We've been kind and not talked about Vista.
RealPlayer
If this software turned up at your door, you'd call the police. RealPlayer commits just about every sin in the book, sprinkling itself across your desktop and offering 'Free games!'. It installs a 'Message Center' that tells you about microcelebrities. There is more advertising embedded in the application than used to be on the front page of The Times. And you just wanted to stream The Archers.

At least Europe's been spared Real's Rhapsody music shop. When we looked at a beta before a subsequently abandoned UK launch, we were given software to install. 'Disable your firewall', it commanded. 'Drop dead', we replied.

Java
Java doesn't do anything by itself. It's a programming language. Programming languages are like sewage plants: if the average user becomes aware of them, something's gone wrong.

Java doesn't know this. Java wants to be in your face. Java wants to be updated. Java wants to tell you the good news about Sun. Have you heard about Sun? Here's a nice picture of our logo. And fancy a copy of OpenOffice? No? Well, never mind. Java's installed a copy of Yahoo Toolbar in your browser instead. Because that's what programming languages are there to do, right?

Yahoo
And talking of Yahoo. Please stop. Please stop trying to take over my email, my search engine, my home page. Please stop 'updating' your IM client to include more emoticons, animations, noises and whatnot — or at least have the good grace to produce a grown-ups' edition I can use at work without feeling like I should still be reading Smash Hits. And yes, when I ask to exit the software, that's because I really want to, not because I'm having a crisis of doubt.

And there is absolutely no point in a toolbar that just replicates all the options on your web site's front page. Not unless you want to come across as the sort of shrill, desperate, needy software company that makes big noises about user relationships but in fact knows less about its users than the Queen does about shopping in Lidl.

Norton Antivirus
It's a little unfair to pick on Norton Antivirus and make it carry the sins of half the desktop malware industry — but only a little unfair. If ever a class of software deserved to be cast into the lower reaches of Hell and run on Satan's own desktop, it is this. Performance- sapping, space-hogging, noisy, irritating and prone to inducing just as many problems as they purport to solve, these horrible, ineffective, expensive lumps of digital thuggery keep entire platoons of support engineers in business and home users in tears. We know. We get the phone calls.

Preinstalled software bundles
After quarter of a century of the IBM PC, we still don't understand why so many companies feel obliged to create swathes of below-par software to install on the computers they sell. Notebook makers are the worst, and Sony the king of them all: the first job for any new Vaio owner is to strip out the layers of desktop 'enhancements', media 'managers' and system 'control software' that serve only to get in the way of doing things the way you know how to do them, interfere with other software packages and suck up such enormous amounts of resources on start-up that two weeks after you've bought one, you're still not sure whether it's broken or not.

Outlook/Exchange
Free, web-based email systems have more storage than you can use. They have powerful, accurate, swift search systems. They have clean interfaces, with threaded conversations and sane attachment management.

Then there's Microsoft's Outlook. Things have been getting better for those whose corporate upgrade strategy allows it, but with major updates happening every four years or so that's a long time to be looking at a non-threaded, licence-restricted storage- squeezed, treacle-slow-searching email system. Especially while the online services get better and better, and doubly so now that email is the single most important business application ever created.

Flash
There's nothing wrong with Flash, provided you don't use it to construct web sites where people want to find information, navigate easily or do anything beyond passively consume exactly what you choose to give them in exactly the way you've decided.

There's also nothing wrong with using it for a splendid splash screen replete with movies, sound and animation — if you don't mind frustrating, annoying and possibly even driving away people who might, just might, have something better to do.

In fact, Flash-based web sites are quite possibly one of the most useful pieces of network technology around. Like heroin or microlights, they ensure that those who think it's a good idea aren't around to annoy us for too long.
http://reviews.zdnet.co.uk/software/...9419834,00.htm





Judge's Report in Jack Thompson Case: Guilty on 27 Charges
Ben Kuchera

In early 2007 the Florida Bar filed a five count, 38-page complaint against Florida Lawyer Jack Thompson, seeking sanctions against the outspoken critic of video games. "This is frankly once again just the Bar going off the deep end trying to use Bar rules to limit my First Amendment activism," Thompson said about the matter, according to Law.com. The trial ended in December 2007, and the verdict was expected in late April of this year. Judge Dava Tunis had asked for an extension in order to, among other things, deal with 400 "pleadings, e-mails, letters and missives (including pictorials)" sent by Thompson since the end of the trial. Judge Tunis has now released her report, with recommendations that Thompson be found guilty of 27 of the 31 charges.

These are not small offenses, as Judge Tunis recommended a guilty verdict for, among other things, "knowingly making a false statement of material fact or law to a tribunal," "using means that have no purpose other than to embarrass, delay, or burden a third person," "engaging in conduct involving dishonesty, fraud, deceit, or misrepresentation," and "making statements that the lawyer knows to be false or with reckless disregard as to the truth or falsity concerning to the qualifications or integrity of a judge."

It's hard to take Thompson's communications with the courts, the press, or government officials seriously at this point. Thompson has included gay pornography in his court filings, causing the Judge presiding over the case to note that "Mr. Thompson made available for unlimited public viewing, on the court’s docketing system, these graphic images." In this most recent case, Thompson created a picture book in reaction to "the court's inability to comprehend" what he was saying. The book contained pictures of swastikas, a copied dollar bill, monkeys, and, in a surreal touch, a handprint with the word "slap" written under it. That's leaving out the cartoon squirrels. Earlier this year, Thompson asked why another gaming writer doesn't "just molest children directly rather than through Rockstar. It would be more personal that way."

Before the release of Grand Theft Auto IV, Jack Thompson wrote Ars Technica a letter that compared the game to polio. These frenzied, nearly constant communications are at the heart of most of Thompson's troubles. Wisely, the Florida Supreme Court has declared that it will no longer accept any filings from the man unless they have been signed by another lawyer.

Thompson still has time before the Supreme Court makes a final ruling on these charges. A hearing covering possible sanctions will be held on June 4; Judge Tunis' final report is not due until early September.

The majority of the primary reporting on this case was done by GamePolitics.com, with the backing of the ECA. "I want to mention that without ECA president Hal Halpin, this series would not have been possible," writer Dennis McAuley wrote. "When I pitched the idea to Hal and asked that the gamer advocacy organization (which owns GamePolitics) cover the not-insignificant cost of acquiring the initial round of transcripts, he didn't hesitate. When we needed additional transcripts later, Hal insisted that the ECA cover the expense."

McCauley invited Thompson to share his closing statement, and any other insights he had about the trial. After ranting at the writer, Thompson finally stated that he "spent nine days in trial. I don't have to relive it for a twit who couldn't care less what really happened there, asshole."

Despite the ambivalence of the mainstream media in reporting on this case, and no matter what the final outcome turns out to be, the coverage of the trial has done something more damaging than any attack Thompson could have dreamed up on his own: it has let the public judge the man through his own actions and words.

GamePolitics was able to get Thompson's closing statement, and the man spoke like a captain straightening his coat as the ship goes down. "I'm simply making the argument, Judge, that my motivations—which I have tried to make clear, maybe to the point of nausea—are religious and that my efforts against the distribution of adult material, pornographic material, violent material, adult rated material to children is violative of the law as well as violative of Scripture. I quoted the biblical passage where Jesus says, reportedly: 'If any one of you should cause one of these little ones to stumble, it would be better that a millstone be tied around your neck and that you be cast in the uttermost depths of the sea.'"
http://arstechnica.com/news.ars/post...7-charges.html





Place to Pee: New Belgian Urinal-Based Video Game
Michael Thompson

As if peeing into a urinal wasn't fun enough already, it's now possible to play video games while doing so. Two men in Belgium (the home of the world's greatest beers) have unveiled Place to Pee, a video game that relies on players hitting sensors in urinals to control game play.

Werner Dupont and Bart Geraets (a software and electrical engineer, respectively), the game's developers and self-labeled beer fans, created the Place to Pee games to be playable for two bathroom visitors at time. According to Dupont and Geraets, the idea for the game came to them while they were drinking some Belgian trappist ale, a time when most breakthroughs of genius take place.

The two different modes feature a ski race that has players compete against each other on a virtual slalom course and a space battle where you fire on hostile aliens. Despite the fact that players are required to relieve themselves into a urinal in order to actually play, women are capable of competing in the game, as well: apparently, female players can get in on the action by utilizing a specially-designed paper cone.

While these games are recent creations, they seem to be a part of the same franchise that was shut down by Belgian gendarmes this past summer due to claims of indecency.
http://arstechnica.com/journals/thum...m-by-beer-fans





Web Game With a Message Debunks H.I.V. Myths
Brian Stelter

Hot or Not, a Web site where people submit photographs of themselves so that strangers can rate how attractive they are on a scale of 1 to 10, has spawned many imitators (plus a fair number of critics who view it as a sign of the end of civilization as we know it).

One new spinoff, Pos or Not, has a serious purpose (tasteful or not). The site, www.posornot.com, introduced in late April, is an H.I.V. education effort disguised as a game. It shows photographs and brief biographies of men and women ages 21 to 30, and asks visitors to decide whether each is H.I.V. positive or negative. The message is that you can’t judge someone’s virus status by looks, occupation or taste in music.

The site is sponsored by MTV’s college network and the Kaiser Family Foundation, a nonprofit group that focuses on health policy. “We feel it’s another kind of activist tool to get out the word about H.I.V. protection,” said Stephen K. Friedman, the general manager of mtvU, the college and university offshoot of Viacom’s MTV network.

The first trial by mtvU of what Mr. Friedman calls “games for change” was Darfur Is Dying, an online simulation of a refugee camp that has logged more than 1.5 million plays since 2006. Other companies have sponsored games about the Israeli-Palestinian conflict, the immigration debate and the world’s water resources.

The network wants the word about its H.I.V. site and its message to be spread like a popular YouTube video. It enlisted celebrities like Wyclef Jean, a musician, and Rosario Dawson, an actress, to make promotions for the game, which are playing across MTV’s networks.

The game — if it can really be called that — was played about 5.1 million times by 400,000 people in its first three weeks, according to mtvU. Entertainment Weekly’s Web site suggested it might be the “most depressing use” of an Internet trend ever, but suggested that any H.I.V. outreach effort could be beneficial.

Mr. Friedman said that in a media-saturated climate, maybe young people have to be shocked into paying attention. “Looking at the statistics that one in four people who are H.I.V. positive in the U.S. don’t know it, it’s pretty staggering,” he said. “We hope that something like this will get under their skin.”

“If it makes some people uncomfortable,” he added, “that’s not necessarily a bad thing.”
http://www.nytimes.com/2008/05/19/bu...dia/19mtv.html





Feud Fuels Bill O'Reilly's Blasts at GE
Howard Kurtz

Bill O'Reilly, the Fox News star, is mounting an extraordinary televised assault on the chief executive of General Electric, calling him a "pinhead" and a "despicable human being" who bears responsibility for the deaths of American soldiers in Iraq.

On the surface, O'Reilly's charges revolve around GE's history of doing business with Iran. But the attacks grow out of an increasingly bitter feud between O'Reilly and the company's high-profile subsidiary, NBC, one that has triggered back-channel discussions involving News Corp. owner Rupert Murdoch, Fox News Chairman Roger Ailes, NBC chief executive Jeff Zucker and General Electric's CEO, Jeffrey Immelt.

Ailes called Zucker on his cellphone last summer, clearly agitated over a slam against him by MSNBC host Keith Olbermann. According to sources familiar with the conversation, Ailes warned that if Olbermann didn't stop such attacks against Fox, he would unleash O'Reilly against NBC and would use the New York Post as well.

Both Fox and the Post are owned by Murdoch, who complained about Olbermann's conduct in separate calls to Zucker and Immelt.

The high-level appeals failed, and O'Reilly has escalated his criticism of GE in recent weeks, declaring, "If my child were killed in Iraq, I would blame the likes of Jeffrey Immelt."

GE has long had a corporate presence in Iran, which U.S. officials say is providing weapons and training for Shiite militias in the Iraq conflict. Under growing criticism from the public and its own shareholders, GE announced in 2005 that it would accept no new business in Iran and would wind down existing contracts, which mostly involved sales of oil, gas and energy and health-care equipment. The remaining work, valued at less than $50 million, amounts to less than .01 percent of GE's income, and the company says the final four contracts will expire within weeks.

What began four years ago as a colorful feud between rival commentators, instigated by Olbermann as a way of drawing attention, has become a tale of bruised egos and secret maneuvering at the highest levels of two multinational giants.

Fox News spokesman Brian Lewis said Ailes never offered a "quid pro quo" involving a cease-fire by O'Reilly and Olbermann. "That's editorial control of Bill's show, and we don't do that," he said. "Bill doesn't run topics by Roger, or anyone else for that matter."

Lewis dismissed the notion that Ailes has ever suggested using Murdoch's tabloid for revenge, saying: "Roger doesn't control the editorial policy of the New York Post."

Olbermann delights in ridiculing "Bill-O" virtually every night for his style, his interviews and his opinions, lambasting what he calls "Fox Noise" and often bestowing on O'Reilly his "Worst Person in the World" award.

O'Reilly has denounced NBC just as vehemently but now aims higher on the corporate ladder. On his Fox News show this month, O'Reilly said that Immelt "is doing business right this minute with Iran, who are killing our soldiers. . . . That Immelt man answers to me. . . . That's why I'm in this business right now, to get guys like that."

Days later, O'Reilly interviewed Tom Borelli, a portfolio manager and dissident GE shareholder. The program played a clip of Borelli, at GE's annual meeting, telling Immelt that the company's products are keeping Iranian President Mahmoud Ahmadinejad "comfy when he's plotting to kill U.S. troops and trying to annihilate Israel. It's just an outrage."

Last week, in an unrelated segment with CBS's Kimberly Dozier about being injured in Iraq, O'Reilly used a graphic that combined GE's logo with a photo of Ahmadinejad. The heading: "Business Partners."

GE spokesman Gary Sheffer called O'Reilly's remarks "offensive," saying: "He has a right to his opinion, and we equally have a right to be appalled by it. We felt he crossed the line. . . . Nothing we supply, or any goods and services we have supplied to Iran, is in any way endangering U.S. troops."

Asked about O'Reilly's motivation, Sheffer said that executives at Murdoch's News Corp. "tell us if the attacks on O'Reilly end, the attacks on GE will end. They've had conversations with our news executives saying, 'If you stop, we'll stop.' " An NBC spokeswoman confirmed the calls.

Fox would not comment on the criticism of Immelt, and O'Reilly declined to be interviewed. Some Fox staffers say Olbermann was out of bounds last month when he imagined the fate of "a poor kid" born to a transgendered man who became pregnant, adding: "Kind of like life at home for Bill's kids."

The sniping between O'Reilly and Olbermann initially seemed like good entertainment. But NBC News President Steve Capus grew alarmed when O'Reilly began saying that NBC correspondent Richard Engel was taking an antiwar position in his reporting from Iraq and that the network wasn't recognizing the early success of President Bush's surge.

"It is one thing to have corporate jousting between Keith and O'Reilly," Capus said. "When it becomes an over-the-top, inaccurate distortion and gross misrepresentation of the job being performed by Richard Engel, then I'm going to be concerned and feel the need to act."

Early last year, the sources say, Capus called Ailes to say that O'Reilly had gone over the line with reckless attacks on Engel. But, the sources recounted, Ailes said he agreed that NBC was against the war and had aligned itself with Olbermann's mockery. Capus, he said, had the power to shut down the situation by telling Olbermann to back off.

The conversation grew tense as Capus asked whether Ailes was threatening him with retaliation by O'Reilly and News Corp. if Olbermann kept up his criticism. Ailes kept returning to highly personal comments by Olbermann, whom he referred to with an expletive, and the impasse remained. The sources declined to be identified furnishing details of private conversations.

In last summer's conversation between Ailes and Zucker -- the two men have known each other since Zucker tapped him as a commentator for the "Today" show in the early 1990s -- the onetime Republican consultant asked whether NBC still cared about the truth. Olbermann had inaccurately called Ailes "the lead political consultant for Rudy Giuliani's presidential campaign." Ailes worked for Giuliani's New York mayoral campaign in 1989, but no evidence has surfaced that he played a role in the presidential bid.

Zucker did nothing as a result of the call. "I have never asked Keith Olbermann to tone anything down," he said in a brief interview.

Olbermann said in an interview that his sources say Ailes was offering the campaign advice, which he did not explain or detail in his commentary. It would be a major breach of journalistic ethics for the head of a news channel to advise a politician, especially one his reporters are covering.

Fox's Lewis laughed off the charge, saying: "If he was offering Rudy advice, you think Rudy would have done as badly as he did? No way Roger was giving him advice."

Murdoch's call to Zucker, which was polite in tone, involved a request that Olbermann not air video from a Daily Kos blogger who had made a scene at O'Reilly's Long Island home. That, Murdoch said, should be off limits.

Activist Mike Stark had confronted O'Reilly when he was retrieving his newspaper, planted derogatory signs on his street and distributed derogatory material to neighbors. Olbermann says the only time he ever talked to Stark was to interview him about a stunt in which he called O'Reilly's radio show and mentioned Olbermann's name.

Olbermann says that NBC Senior Vice President Phil Griffin called to ask him to exercise restraint but that he had already decided to criticize Stark for going to O'Reilly's home. He told viewers, "with great regret," that Stark's behavior was "not acceptable."

He and NBC are fair game for O'Reilly, Olbermann says, but "when you start accusing a corporation of murdering Americans, with the thinnest and most ridiculous arguments behind it," it is unfair to GE employees.

While O'Reilly is cheered by conservatives and Olbermann is a hero on the left, their dispute is more personal than ideological. Fox staffers say they don't share O'Reilly's obsession with Olbermann, noting that the "O'Reilly Factor" audience of 2.5 million viewers is 2 1/2 times the size of Olbermann's. "Countdown," however, has become increasingly competitive among younger viewers.

O'Reilly initially retaliated in 2006 with a petition on his Web site that urged MSNBC to fire Olbermann. But he does not mention Olbermann's name on the air. Instead, he routinely assails NBC -- sometimes naming Zucker and Capus -- as an organization that "spews out far-left propaganda," is "the most aggressive anti-Bush network" and is "in the tank" for Barack Obama.

Immelt had GE put out an internal memo last month, saying "a Fox News personality" has been "misleading viewers about our company." GE may continue selling equipment to Iranian hospitals under a humanitarian program licensed by the U.S. government.
http://www.washingtonpost.com/wp-dyn...051802313.html





CN8 Fires Barry Nolan Over Bill O’Reilly Protest
Jessica Heslam

CN8 has fired veteran TV journalist Barry Nolan for publicly protesting the decision by the local Emmy Awards to honor Fox News blowhard Bill O’Reilly.

Nolan tells MediaBiz he was fired Tuesday following a two-week, unpaid suspension.

“I knew going in that there was serious risk that I’d lose my job,” Nolan said yesterday, “but nobody likes it when people tell them to stifle, not even Edith Bunker.”

A CN8 spokeswoman issued this statement: “Effective May 20, Barry Nolan is no longer employed by CN8, The Comcast Network. Backstage will continue to air weeknights at 8:00 p.m. with host, Sara Edwards, and its talented team of reporters and contributors.”

Before the May 10 awards, Nolan sent e-mails to industry colleagues encouraging them to write to the Emmy governors - if they shared his opinion - and let them know “this is an appalling choice for an honor.”

“He’s delusional,” Nolan said of O’Reilly, a former Boston TV anchor. “He’s a man that mangles the facts.”

At the awards, Nolan said he quietly put fliers on tables that “simply had” quotes from O’Reilly as well as three pages from the sexual harassment lawsuit O’Reilly settled that was brought by his former producer.

Security approached Nolan and told him he couldn’t distribute information at the event.

Nolan says he has no regrets about speaking out against giving O’Reilly “the highest honor” that the local Emmy Awards can bestow. Past winners include Mike Wallace and Natalie Jacobson.

“When they announced O’Reilly people booed,” Nolan said, “and it wasn’t me. I was quiet.”

Nolan says he just got his five-year watch at CN8. As for his future, he plans to get his lawn in good shape and spend time with his wife.
http://www.bostonherald.com/business...Reilly_protest





Why Old Media is Running Scared of Google
Charles Cooper

Talk about missing the forest for the trees. With everyone and their mother-in-law predicting a coming wave of acquisitions of so-called new media companies by old media outfits, that future's already snuck up on us.

In the last year:

• Cox bought Adify
• Hi-Media Group bought Fotolog
• Time Warner's AOL bought Bebo, Quigo, Third Screen Media
• Comcast bought Plaxo
• Disney bought Club Penguin
• CBS bought Last.fm, CNET Networks, Wallstrip, Dotspotter
• Microsoft bought 1.6 percent of Facebook
• Hearst bought Kaboodle and Answerology
• Jupiter Media bought MediaBistro
• News Corp. bought Photobucket, Beliefnet
• The New Times bought Freakonomics blog
• Forbes bought Clipmarks
• Discovery bought Treehugger

If you use News Corp.'s 2005 acquisition of MySpace.com as the starting point, the list gets longer. Going back that far, there's been more than $19 billion worth of significant mergers between the biggest old and new media players in the online media industry.

After Microsoft launched its late January takeover bid for Yahoo, a lot of new media start-ups hoped it would trigger a chain reaction where they'd be able to cash out. It's easy to understand their anxiety. A recent report from PubMatic concluded that:

• On average, Web site monetization dropped by 23 percent from 49 cents in March to 38 cents in April.

• Among the verticals, social networking led the plunge with monetization dropping 47 percent, from 37 cents in March to 19 cents in April, below January lows of 22 cents. Entertainment monetization dropped 17 percent from 40 cents in March to 33 cents in April. Gaming and sports were down marginally (4 percent and 5 percent, respectively). Technology remained relatively flat at 83 cents in April vs. 82 cents in March, but is still off January highs of 92 cents.

Maybe a bunch will still cash out before the window slams shut but the more interesting question is why more media giants haven't built their online empires organically? The snarky explanation is that they're too hidebound and slowed by bureaucracy to think creatively about this stuff. But that's too easy and misses the bigger point.

I think Piper Jaffrey's Gene Munster offers a better answer when he wrote in a recent report that Google "has forced old media companies to realize they must act immediately or lose relevance in the Internet space." He may be right about that. These companies typically came late to the party when they recognized that lots of their customers (and advertisers) were heading to the Internet. And thanks to the Yahoo novella, we've seen how even a company like Microsoft, which doesn't fit under the "old media" label, finds itself scrambling to find answers to the Google question.

I just don't know whether the land grab strategy will be enough to restrain Google's growing appetite. Maybe it is, but I wouldn't want to take that bet.
http://www.news.com/8301-10787_3-994...l?tag=nefd.top





After Forays With ABC and HBO, a Video Blogger Returns to Video Blogging
Brian Stelter

“It’s weird,” Amanda Congdon says, looking off-camera, eyeing her own image reflected on the computer screen in her Los Angeles apartment. “It’s just weird when you come back.”

Ms. Congdon, 26, became the closest thing to an Internet sensation by hosting “Rocketboom,” one of the first Web video series to become a breakout hit. But since she departed the show in 2006, her attempts to go mainstream have largely fallen flat.

She signed a development deal with HBO, but nothing came of it. She joined ABC News to produce eccentric newscasts, but she clashed with the culture there and exited quietly last fall. And she established a production company but remained largely offline for months.

Now Ms. Congdon, feeling a little burned by big media, is back blogging and hosting and producing. Working with the independent production studio Media Rights Capital, she is reintroducing herself on “Sometimes Daily,” an irregular look at life through Ms. Congdon’s eyes.

Ms. Congdon and her creative partner Mario Librandi aren’t entirely sure what to call it. “It’s an interactive variety show that is embedded into my life,” Ms. Congdon said in an interview.

Returning to the form “just takes some adjustment,” she said in a new video. “I missed it.”

The segments will be centered on a weekly theme. (Last week’s was “outsider.” An upcoming one will be “tattoos.”) Ms. Congdon and Media Rights hope to build a fan base and advertiser interest around the videos.

“She was really one of the first, if not the very first, Internet blog stars,” said Dan Goodman, the president of digital media for Media Rights Capital. “She has been entertaining people in the digital space since there were people to entertain there.”

For many Web users, Ms. Congdon introduced the concept of the video blog, or “vlog,” in her nearly two years on “Rocketboom.” The irreverent daily shows, initially taped in front of a world map in a Manhattan apartment, were promoted as having at least 200,000 viewers each day, though there was no independent confirmation of that. Mentions on “CSI,” in BusinessWeek and in other mainstream media outlets fueled the site’s growth.

By mid-2006, though, Ms. Congdon and her business partner, Andrew Michael Baron, were feuding over creative and financial direction, each of them said at the time. (Ms. Congdon owned 49 percent of the company, and Mr. Baron owned 51 percent.) When she left “Rocketboom,” the show continued with a new host.

Ms. Congdon set out on a seven-week road trip, documented in “Amanda Across America” videos, of course. She wanted to stay in the online video medium, but she also wanted to experiment with big media.

ABC News felt right at first, she said; looking back, she calls it “the most innovative network news site at the time.” But she found producers at ABC to be unresponsive to her ideas, calling it a “slow and messy process.” It didn’t help that online reporters discovered her freelance commercial work for the chemical company DuPont, raising conflict-of-interest questions that ABC skirted by calling her an independent contractor. (Last fall, when Ms. Congdon left, ABC characterized her tenure as “a great experiment for both of us.”)

Around the time she started at ABC, owned by the Walt Disney Company, she started a development deal with Time Warner’s HBO that expired in November. “I still have yet to climb that mountain,” she said. “Hopefully I’ll get there someday.”

As the two media deals ended, conversations picked up with Media Rights Capital. Ms. Congdon and Mr. Librandi have complete creative control over their work, while the studio runs the business side, they said. “Sometimes Daily” may resemble “Rocketboom” in some ways, but it is intended to be more interactive.

“I wrote both shows, so there’s going to be similarity in the tone,” Ms. Congdon said. “But there’s not going to be a lot of Amanda at a desk in this series.”

Indeed, in one of the first segments of “Sometimes Daily,” Ms. Congdon is seen reading the news in front of an upside-down map, only to discover she was having a nightmare. Dream sequences, person-on-the-street interviews, sketch comedy and live Webcasts will all show the theme of the week intersecting with Ms. Congdon’s life.

With the new site, Ms. Congdon will find out whether she can reconnect to her “Rocketboom” fans and whether she can reinvent the vlog form as she pioneered it four years ago.

“When ‘Rocketboom’ came out, the 2.0 technologies on the Web were nowhere near where they are today,” Mr. Librandi said. “I think that alone is going to spawn a whole new era of online shows.”
http://www.nytimes.com/2008/05/19/bu...19congdon.html





A Sober Warning About Indiana Jones' Fedora
Lore Sjöberg

I'm jazzed to see Indiana Jones and the Kingdom of the Crystal Skull, but my anticipation is dimmed somewhat by the inevitable ensuing upturn in fedora sales. When I go to San Diego Comic-Con this July, I fully expect to see fedoras popping up like mushrooms on the damp lawn of fandom.

It's not the cosplayers that I'm concerned with -- at least they're aware they're playing dress up. It's the folks who say, "Wow, that hat looks so good on Indy, I'm sure it will look just as good with my pre-faded ColecoVision T-shirt."

I hear the Motion Picture Association of America is now rating movies higher on the adultitude scale if they feature smoking, on the grounds that onscreen cigarette puffing influences people to take up the habit themselves. While I think movie fedoras have the same effect, I'm not calling for anything that drastic. I think a disclaimer in 5-foot-tall letters at the beginning of the movie would be fine.

Something like:

"WARNING: Indiana Jones is a fictional character. His movies are all set decades ago. He is more physically attractive than 98 percent of humanity. These are all reasons you should not attempt to dress like him."

See how much that would benefit humanity (except for the hat-selling portion of humanity)?

That's not the only sartorial tragedy that could be prevented by a stern warning at the beginning of a Hollywood blockbuster. For instance:

"WARNING: This movie is set in a magical land with soaring dragons, powerful, reality-warping wizards and people who can wear hooded cloaks without looking like complete dorks. None of these things exist in real life."

"WARNING: In this movie, black, ankle-length dusters make the main characters look mysterious. If you wear one to the local 7-Eleven, the only mystery will be whether you think you know karate but don't, or whether you think you know kung fu but don't."

"WARNING: The extremely cool facial hair styles the bad guys have in this movie, if worn by someone with a body mass index over 30, will make that person look like a '40s-era hotel clerk."

Come to think of it, fashion choices aren't the only problem. Lots of movies are fine in the theater, but have an unfortunate tendency to leak all over the real world. My solution: more warnings.

"WARNING: A character in this comedy talks about sex a lot in a funny accent. This guarantees that most of the people who see it will immediately start quoting it in a poor imitation of the accent. This will become incredibly tiresome before you even get to the car."

"WARNING: This movie contains punch lines. If you repeat these punch lines to people who have already seen the movie, they may laugh. Do not take this as a sign that you, yourself, are funny. This will only lead to disappointment and, in extreme cases, dismemberment."

"WARNING: This movie takes place in space. This means that it will be unrealistic in about 500 different ways. While we encourage you to debate this in online forums, because such chatter translates into merchandise sales via some mechanism we don't fully understand, we are obliged to caution you that most people you encounter will tune you out for the rest of your life once you use the phrase inertial compensators."

"WARNING: Yes, we know many of you want to have sex with one or more actresses in this movie. That's why we put them in the film. Declaring that you would be willing to sleep with them establishes nothing but your sexual orientation, and declaring that you would not be willing to sleep with them establishes nothing but your capacity for self-delusion."

"WARNING: The key lines from this movie will soon be attached to pictures of adorable kitties. You will find this inexplicably funny, and this fact will make you hate yourself."
http://www.wired.com/culture/lifesty.../alttext_0521a

















Until next week,

- js.



















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