[JackSpratts]

A Girl and a Gun
Stephanie Zacharek

EVERYTHING IS CINEMA

The Working Life of Jean-Luc Godard.

By Richard Brody.

Illustrated. 701 pp. Metropolitan Books/Henry Holt & Company. $40.

Richard Brody’s “Everything Is Cinema: The Working Life of Jean-Luc Godard” is a story of transformation, a painstaking account of a lifelong artistic journey. Now we know how one of the greatest of all filmmakers — the man who so radically changed cinema in 1959 with his debut feature, “Breathless” — became an intolerable gasbag. That probably wasn’t Brody’s aim in writing this exhaustive, and sometimes exhausting, critical biography. As Brody, a film critic and editor at The New Yorker, makes clear in the preface, he still believes in Godard’s relevance, claiming that the resolutely not-retired filmmaker, who has lived in Rolle, Switzerland, for the past 30 years, continues to work “at an extraordinarily high level of artistic achievement.”

That’s a lovely, optimistic sentiment, but one that much of Godard’s post-1967 output doesn’t deserve: Empty shadowboxes like “First Name: Carmen” (1983) or “Notre Musique” (2004) seem designed to alienate viewers rather than draw them closer, which is what happens when any artist begins to live entirely inside his or her own head. It’s the artists we love best who are most capable of disappointing us, and anyone who has taken pleasure in the boldness of the movies Godard made from 1959 through 1967 — he produced an astonishing 15 full-length features in that period, beginning with “Breathless” and including “Contempt,” “Pierrot le Fou” and “Weekend” — would have to know that pain is part of love. If we didn’t, how carefully could we have been watching his movies in the first place?

In this serious-minded and meticulously detailed book, Brody is too forgiving of some of Godard’s later, lesser work, but his urge to assess it thoroughly seems to spring from a heartfelt desire to comprehend this complicated and, by most accounts, thoroughly disagreeable man. In examining the use of language in Godard’s 1965 “Alphaville,” Brody writes that “poetry and love are illogical. The leap of faith called love flies in the face of all logic.” “Everything Is Cinema” constitutes something of a leap itself: to love a stubbornly confounding filmmaker like Godard is surely madness. But to fail to take emotional or sensual pleasure in even just one of his pictures is to miss out on poetry.

“Everything Is Cinema” works its way methodically through Godard’s career, beginning with his days as a young cinephile in the early 1950s, writing for Parisian film journals like La Gazette du Cinéma and, later, the newly founded Cahiers du Cinéma. Brody explains that Godard’s entree into the French film industry, via writing criticism, was “revolutionary and didactic”: Godard and his contemporaries — among them future filmmakers of the nouvelle vague including François Truffaut, Jacques Rivette and Maurice Schérer (better known to filmgoers as Eric Rohmer) — educated themselves by making pilgrimages to screenings at the Cinémathèque and the Cine-Club du Quartier Latin, where they might see three or four films a day. Godard, who came from an affluent family, had more money than his contemporaries and found creative, if not especially ethical, ways to get more: in 1950, he helped Rivette finance a 16-millimeter film, partly by stealing and selling rare first editions from his grandfather’s library.

In “Everything Is Cinema,” Brody doesn’t shy away from exposing Godard’s flaws, although his approach nevertheless suggests deep sympathy for his subject. He writes about Godard’s turbulent relationship with his first wife, the actress Anna Karina, who would be the unforgettable face in seven of his movies. There’s a hint of sadness in Brody’s descriptions of how Godard degraded her, both onscreen and off — a way of acknowledging that no woman should have to suffer so much for some guy’s art, even if that guy is Godard.

But Brody does justice to the most fertile period of Godard’s career, an era of magnificence and innovation that few other filmmakers have matched. That eight-year period ended with “La Chinoise,” Godard’s tone poem about radical idealism among the young, and “Weekend,” the movie that, Brody tells us, Godard himself called “‘closer to a cry’ than to a movie.” (Its final title cards read “end of story” and “end of cinema.”) Both of these pictures appeared in France just before that all-important year, 1968, and they precipitated in Godard a “political and aesthetic breakdown.”

The second half of “Everything Is Cinema” covers the films Godard made after 1967, and it’s a very long half. Brody tries to energize us for this interminable home stretch. He acknowledges that post-1967, Godard, who at the time considered himself a Maoist, was trapped in an “ideological straitjacket,” but adds that the ideas behind that ideology “provided the foundation for a new, cooperative form of filmmaking” that would inform the rest of Godard’s career.

Nice try. If only the movies were better. Brody himself dislikes some of them (“Notre Musique”) and greatly admires others (“Nouvelle Vague”). But his enthusiasm for late Godard feels scholarly and tempered rather than passionate, and his extended clinical explications of these films (and the television work Godard did at the time) weigh the book down. When Brody speaks of that “cooperative form of filmmaking” adopted by Godard, he’s referring specifically to Godard’s collaborations first with his friend, the journalist and fellow Maoist Jean-Pierre Gorin, and later with his partner, the writer and filmmaker Anne-Marie Miéville. Otherwise, though, the mode of filmmaking Brody describes in the last half of “Everything Is Cinema” is more like a dictatorship than a cooperative: Brody’s narrative is peppered with quotations from actors, cinematographers and others (among them Norman Mailer, who worked briefly with Godard on the 1987 “King Lear”) attesting to the director’s rudeness and willful refusal to communicate what he wanted from them. (There are other directors, like Godard’s nouvelle vague colleague Rivette, whose filmmaking methods are better examples of the collaborative ideal of the ’60s and early ’70s. To make his 12-hour-plus epic “Out 1,” Rivette gave his large cast of actors guidelines for creating their characters, and they wrote most of the movie’s dialogue themselves.)

Brody is hardly blind to his subject’s foibles: he calls Godard on his flimsier political ideas, particularly his devotion to Maoism (a trend among French intellectuals in the late ’60s that Brody identifies, rightly, as thinly veiled fascism) and, later, the anti-Semitism that repeatedly surfaced in his work. It’s also worth noting that Godard, the committed Maoist and spewer of anti-capitalist, anti-American rhetoric, made two commercials for Nike in the early 1990s. They were never broadcast, though presumably Godard cashed the checks.

Throughout his career, Godard’s political ideology has often amounted to little more than slogans, attention-grabbing sound bites. In 1969 he told a London journalist that opera houses should be burned as a means of remaking the culture. Then he amended the notion: “No, not burn them, just forget about them a bit. As Mao said, if we burn books we would not know how to criticize them.” Although Brody repeatedly challenges Godard’s limited ideology, he does buy a little too readily into the notion that a work of art informed by political ideas is inherently more meaningful or more interesting than one with, say, a great deal of aesthetic inventiveness or emotional depth.

Godard’s political ideas have never been the strongest elements of his movies. Unfortunately, after 1968, they often became their focal point. Brody is at his best when he’s describing how Godard’s technique — so dazzling, particularly in the early years — intensifies the charge of the stories he’s telling, opening us up to new ways of seeing. “Even now,” Brody writes, “ ‘Breathless’ feels like a high-energy fusion of jazz and philosophy. After ‘Breathless,’ most other new films seemed instantly old-fashioned.” He’s got that right. “Breathless” is Godard’s most readily comprehensible film, the access point for many future devotees. And its freshness never abates: to watch it, even today, is to feel present at the birth of something new. Beginning of story. Beginning of cinema. If Godard had given us nothing more, that would be enough.
http://www.nytimes.com/2008/07/13/bo...acharek-t.html





In Novels for Girls, Fashion Trumps Romance
Michael Winerip

A WHILE back, Naomi Johnson, a communications professor at Longwood University in Virginia, sent me her doctoral thesis, which she described as a feminist analysis of the new wave of teenage romance novels. I don’t read lots of dissertations, and almost tossed this one when the words “ontological,” “objectivist” and “constructivist” appeared in the same sentence, on Page 38. But I kept at it, because one of the series for teenagers that Dr. Johnson analyzed was the best-selling “Clique” books, which my 14-year-old daughter, Annie, loves and we buy the moment the newest one hits the bookstore.

As others have, Dr. Johnson questions the female characters’ preoccupation with looks, thinness, fashion, makeup, wealth — we’re talking spoiled, rich middle-school girls from Westchester County. But what grabbed me as new was her documentation of what she called the “incessant litany of brand names.” She examined three series, with combined sales of 13.5 million — “Clique,” “Gossip Girl” and “A-List” — and found, on average, there was more than one brand mentioned per page, 1,553 brand mentions in 1,431 pages of the six books she had read.

Massie, the lead “Clique” character, doesn’t wear miniskirts and sandals. She wears Moschino minis, Jimmy Choo sandals, and Chanel No. 19 on her thin wrists, rides in a Range Rover, drinks Glaceau Vitamin Water and totes her books in a Louis Vuitton backpack.

Dr. Johnson concluded that romancing boys was no longer the primary objective of this new generation of romance novels, as it had been in the good old days of the 184-book series “Sweet Valley High.”

In the new romances, she wrote, “brands are more important than romantic relationships to female protagonists’ popularity.”

“Heroines no longer become women through romance, they become feminine through consumption.”

Indeed, you can often tell the bad guys by their unfortunate brand choices. The beautiful heroine of the “A-List” series, Anna, drives a Lexus (mentioned seven times in Chapter 1 of “American Beauty”) and wears a Molinari dress and Sigerson Morrison sandals. The poor thing gets in a car crash with some idiot middle-aged woman in a rusty Honda Civic, whose gray roots are showing and — here you may want to exercise parental discretion — who is wearing a bad Chanel knockoff scarf.

But the most worrisome issue Dr. Johnson raises is whether these fashion companies paid the book publishers to have their products mentioned. The three series were written by different authors, but were created and packaged by Alloy Media and Marketing and then sold to Little, Brown publishers. One of Alloy’s chief revenue streams is product placement. As Alloy says on its Web site, it is very good at reaching the pre-teen and teenage audience — through ads in student publications, ads on hot Internet sites, even ads in school bathrooms.

Had the fashion companies paid Alloy to have their products named in these books? Dr. Johnson was concerned because of a posting on Alloy’s Web site in 2006: “Advertisers have the opportunity to get their products or services cast in these best-selling books. The value of these mentions far exceeds the hundreds of thousands of readers, creating a viral product buzz.”

Dr. Johnson says she e-mailed Alloy about its policy, but got no response.

The author of the “Clique” series, Lisi Harrison, as well as representatives of Alloy and Little, Brown all responded to my calls. They were adamant that there had never been any paid placements. “There was no product placement in any of those books, nothing,” said Les Morgenstein, president of Alloy Entertainment, a division of Alloy Media. “We never had any cross-promotion deals, no barter exchanges, nothing.”

Mr. Morgenstein said that the 2006 Web posting had been from another Alloy division. “They had at one point thought this could be an opportunity for our books, but nothing ever came of it,” he said. “No brand ever expressed interest.”

He said that there is paid product placement for the “Gossip Girl” television series on the CW network. And both he and Megan Tingley, the publisher of Little, Brown Books for Young Readers, said that while they had never done paid product placement in any book, they would not rule it out in the future. Both said that if they ever did, “transparency” would be essential. “We would make it clear that’s the case,” Ms. Tingley said.

I asked Ms. Harrison, the “Clique” author, why, then, her books named brands so often. “Details are what make the books seem so real for these girls,” she said. “It feels very current, like one of them wrote it. It’s actually the stuff they’re talking about.”

Originally, she saw it as satirical, she said, a kind of “over-the-top absurdity.” She says that growing up in Toronto (for the record, she has never lived in Westchester, just visited a few times for weddings), she was never permitted designer clothes: “To this day I’ve never bought any high-brand designer clothing.”

Critics, including Naomi Wolf in The New York Times Book Review, disparaged the books for focusing on girls with such bad values, but Ms. Harrison says that just because a popular, fashion-obsessed mean girl is the protagonist, that doesn’t mean those are the author’s values. “Massie’s a bully,” Ms. Harrison said. “But she’s insecure. She talks a big game but she can’t deliver. By humanizing the social bully, it shows her weaknesses and makes her less fearsome. It takes some of the power from the mean girls.”

Dr. Johnson doesn’t advocate — as some librarians have — pulling the books off the shelf or stopping your daughter from reading them. “Educators should not ignore the pleasures of reading romance novels,” she wrote. “Or treat adolescents as hapless victims of media influence.” She suggests that parents talk to their daughters about Massie’s values, “versus judging people by their heart and intellect and skills.”

And so, I recently read my first “Clique” book. As has been true with romance novels since the beginning of time, Massie doesn’t just speak, she blurts; Alicia gushes, Dylan snorts, Claire’s blood boils and the horses they ride along Westchester bridle paths have thunderous hooves.

On the other hand, Massie’s boyfriend Chris has eyes the color of a royal blue Polo shirt.

“Frankly, sometimes I found the books really entertaining,” Dr. Johnson told me, and so did I. While I didn’t feel the thrill I had when Annie read “To Kill a Mockingbird” for school, there was nothing in the “Clique” book that gave me pause. At her age, I read a ton of trashy sports books.

The mass media has power, but for my money, a vigilant parent has lots more. Annie may devour every word of Massie’s nastiness, but unlike Massie, Annie plays catcher on her softball team and was the only female trumpet player in the county jazz band this year and is working two part-time jobs this summer.

As for clothes, when she had her eighth-grade stepping-up ceremony last month, we didn’t go to Barneys New York and buy Prada. My wife went down the street, borrowed five dresses from a neighbor and Annie picked the one she liked best.

Still, as Annie strode across the middle-school stage in Mrs. Briffel’s borrowed dress, I couldn’t help noticing her eyes sparkled like Tiffany diamonds.
http://www.nytimes.com/2008/07/13/ny...13Rparent.html





'Lassie' Heirs Regain Rights

Court decision reverses Classic Media win
Janet Shprintz

The 9th U.S. Circuit Court of Appeals held Friday that the daughter of Eric Knight, the author of "Lassie Come Home," has the right to terminate Classic Media's copyrights in the classic story of a boy and his dog.

Friday's decision reverses Classic Media's win on summary judgment in the lower court.

The court's opinion addressed a complicated issue of copyright law involving whether the law's termination of transfer right is eradicated by a post-1978 assignment of the rights. In a victory for authors and their heirs, the court held that their rights are not terminated.

As outlined in the 25-page decision, Knight granted rights to make the television series to a predecessor to Classic in 1940. Knight's heirs renewed the copyrights in the 1960s. Classic obtained an assignment of rights from Winifred Knight Mewborn, one of Knight's three daughters who also assigned their rights in 1976, and an additional grant of ancillary rights only from Mewborn in 1978 for $3,000.

In 1996, Mewborn served a termination notice, and Classic claimed that she didn't have the right to terminate the copyright under copyright law. After years of vituperative letters, Classic finally sued in 2005, seeking a declaration of rights. Reversing the lower court, the 9th Circuit held that the 1976 Copyright Act intended to benefit heirs, and Mewborn's post-1978 assignment did not terminate her rights.

"Seventy years after Eric Knight first penned his tale of the devoted Lassie who struggled to come home, at least some of the fruits of his labors will benefit his daughter," concluded the 9th Circuit.

Mewborn, who is now 87, was represented by Marc Toberoff, who has scored a series of wins on behalf of rights holders and their heirs, including high-profile cases involving "Dukes of Hazzard" and "Superman."
http://www.variety.com/article/VR111...goryid=13&cs=1





EU to Introduce New Music Rights System Despite Lobby
David Gow

The European commission will tomorrow defy a high-profile lobbying campaign by composers and songwriters and order a new pan-European system of selling online music rights.

Songwriters marshalled by Robin Gibb of the Bee Gees and including Bryan Ferry, Paul McCartney and Mark Knopfler have enlisted French president Nicholas Sarkozy and German chancellor Angela Merkel to back their campaign.

But despite their lobbying efforts and claims that hundreds of thousands of small writer and publisher firms would be wiped out under the proposed system, Neelie Kroes, EU competition commissioner, will rule against the monopoly of national groups that collect performing rights.

Her decision, in an anti-trust case dating back six years, means that composers will no longer be obliged to register with the collecting society on their home territory and can shop around for the most efficient management of their performing rights. The commission says choosing one society to act for them across the EU will maximise their income and cut the management fees the societies "cream off".

Kroes will also give the go-ahead for broadcasters, whether online or by cable and satellite, to negotiate an EU-wide licence with one society - rather than having to negotiate separately with the 24 agencies operating in the EU, to promote online music sales in Europe, which lag behind those of the US and account for less than 10 percent of the market.

The commission case has won the backing of trade lobby European Digital Media Association, which embraces firms such as Amazon, Google, Microsoft and Orange. It insists that collecting societies are vital in ensuring that songwriters/composers are paid fairly and efficiently but have been guilty of anti-competitive behaviour. It was also supported by AER, a lobby of more than 4,500 private or commercial radio stations in Europe that says it pays out €325m (£260m) a year for music rights to collecting societies.

The European Composer and Songwriter Alliance argued earlier this month that the whole system would collapse if collecting societies were forced to compete with each other across national boundaries on price. Songwriters and composers would withdraw their repertoires and refuse to allow their work to be played. But Kroes's officials said the national collecting societies would remain free to negotiate and set the level of rights paid to songwriters and composers on their own territory and would not be allowed to discriminate against "foreign" nationals.
http://www.guardian.co.uk/technology...c.digitalmedia





Orphan Works Bill Deserves Support: RMS

I just received an email from Richard Stallman, creator of the GPL, concerning the Orphan Works bill I wrote about last week.

Based on his email, it appears the bill may not be such a bad thing after all.

Here's an excerpt:

I discussed [the Orphan Works bill] with a lawyer (Dan Ravicher of the Software Freedom Law Center)... He said that the bill does not eliminate the rights of copyright owners who aren't found. Rather, it merely limits what damages they are entitled to recover from an infringer who, before commencing the infringement, attempted a good faith search to identify the owner and seek permission to do whatever is now considered infringement.

In essence, even if the defendant can prove he tried to find the author and couldn't, when the author later objects to the infringement, he can still sue and get money and an injunction. This bill merely places some limits on how much money can be recovered in such cases. It would not mean open-season on GPL-covered free software.

So I think we should support this bill. It does not go far enough; to make copyright law just requires larger reductions in copyright power. But as far as it goes, it is good.

Obviously, the founder of the Free Software Federation knows the score when it comes to copyright law, so I will have to defer to him on this issue.
http://blamcast.net/articles/orphan-...es-support-rms





Patent Gridlock Suppresses Innovation
L. Gordon Crovitz

The Founders might have used quill pens, but they would roll their eyes at how, in this supposedly technology-minded era, we're undermining their intention to encourage innovation. The U.S. is stumbling in the transition from their Industrial Age to our Information Age, despite the charge in the Constitution that Congress "promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries."

For the third year in a row, Congress has just given up on passing a law reforming how patents are awarded and litigated. This despite growing evidence that for most industries, today's patent system causes more harm than good. Litigation costs, driven by uncertainty about who owns what rights, are now so huge that they outweigh the profits earned from patents.

It's true that defining intellectual property is hard at a time when new technologies upset the traditional ways of protecting rights, as debates over digital piracy make clear. But in the case of patents, poorly defined property rights for inventions are leading even the biggest companies to take desperate measures, including banding together to protect themselves against claims of increasingly broad and vague patents.

Companies as diverse as Verizon, Google, Cisco and Hewlett-Packard recently formed the Allied Security Trust to buy patents they may want to use some day and that otherwise could end up in the hands of "patent trolls." These firms buy up old patents not to produce anything, but instead to work the system to extract settlements. A similar group formed against trolls to protect the Linux open-source operating system. A Google executive explained that helping to buy up and license patents is the "legal equivalent of taking a long, deep, relaxing breath." Companies can rest easier, and legitimate inventors get paid for their work.

These corporate trusts seem like odd ways to protect products, but the memory is still fresh of the BlackBerry device almost being forced to shut down. Parent company Research in Motion paid more than $600 million in 2006 to settle a case. But in this and many other cases, companies can't be sure whether or not they are complying with patent law. For example, by one estimate there are more than 4,000 patents that must be reviewed and potentially licensed by firms selling products or services online. The legal abuses arising from uncertainty are legion. More than 100 companies are being sued for alleged patent infringement by using text messaging internationally.

The proposed law in Congress would have reduced potential damages to the value of the technology, not the full value of the completed product. Another uncertainty would have been reduced by moving to the first-inventor-to-file system, instead of our more ambiguous first-to-invent standard. The larger problems would have remained, including the trend of awarding vague patents, coupled with a still-primitive system for notifying others of the existence of patents.

Yet the fault line over patent reform signals the deeper problems. Many pharmaceutical companies lobbied against the proposals, fearful of reduced value in their key intellectual property. In contrast, most technology firms supported the reforms, worried more about uncertainty in the law than about the value of their patents.

Both sides may be right. New empirical research by Boston University law professors James Bessen and Michael Meurer, reported in their book, "Patent Failure," found that the value of pharmaceutical patents outweighed the costs of pharmaceutical-patent litigation. But for all other industries combined, they estimate that since the mid-1990s, the cost of U.S. patent litigation to alleged infringers ($12 billion in legal and business costs in 1999) is greater than the global profits that companies earn from patents (less than $4 billion in 1999). Since the 1980s, patent litigation has tripled and the probability that a particular patent is litigated within four years has more than doubled. Small inventors feel the brunt of the uncertainty costs, since bigger companies only pay for rights they think the system will protect.

These are shocking findings, but they point to the solution. New drugs require great specificity to earn a patent, whereas patents are often granted to broad, thus vague, innovations in software, communications and other technologies. Ironically, the aggregate value of these technology patents is then wiped out through litigation costs.

Our patent system for most innovations has become patently absurd. It's a disincentive at a time when we expect software and other technology companies to be the growth engine of the economy. Imagine how much more productive our information-driven economy would be if the patent system lived up to the intention of the Founders, by encouraging progress instead of suppressing it.
http://online.wsj.com/article/SB1215...od=fpa_mostpop





Court Clears eBay in Sale of Counterfeit Items
Brad Stone

EBay has scored an important victory against a longtime legal nemesis.

In a long-awaited decision in a four-year-old trademark lawsuit against eBay brought by jeweler Tiffany and Co., Judge Richard Sullivan of the Federal District Court in Manhattan ruled Monday that the online retailer does not bear a legal responsibility to prevent its users from selling counterfeit items on its marketplace.

The decision in the closely watched case, which will likely be appealed by Tiffany, reaffirms that Internet companies do not have to actively filter their sites for copyrighted or trademarked material. Rather, they can rely on intellectual property-holders to monitor the sites, as long as the retailers take material down when rights-holders complain. The decision marks a dramatic turn in eBay’s recent courtroom fortunes. The ruling comes a week after a French judge ordered eBay to pay $60 million to French luxury goods maker LVMH, the maker of Louis Vuitton handbags. In April, a German appeals court ruled that eBay must take preventative measures against the sale of counterfeit Rolex watches.

Tiffany originally filed the trademark lawsuit against eBay in 2004, after conducting a study that found a majority of items purchased on eBay under the Tiffany’s brand were fakes. Lawyers for Tiffany argued that eBay directly profited from infringement of its trademark, while eBay’s lawyers countered that, just like YouTube or MySpace, it was required only to faithfully take down material when rights-holders complained.

Judge Sullivan concurred with eBay in his 66-page decision released this morning.

“Tiffany has failed to demonstrate that eBay knowingly encouraged others to dilute Tiffany’s trademarks,” he wrote. “Rather, to the extent that eBay may have possessed general knowledge of infringement and dilution by sellers on its website, eBay did not possess knowledge or a reason to know of specific instances of trademark infringement or dilution as required under the law.”
http://www.nytimes.com/2008/07/15/te...15ebay.html?hp





Warning: Fake Windows 7 M2 Build on P2P Sites
Emil Protalinski

Microsoft has been tight-lipped regarding what will be in Vista's successor; this can be irritating to partners and developers, but the company has also been good at keeping internal Windows 7 builds from leaking out to the public.

Windows 7 Milestone 1 (M1) may have leaked a few months ago under builds 6.1.6519.1 and 6.1.6574.1, but even then those builds were much delayed; M1 went out to key companies in January 2008. M2 has already been completed (as of May) but it has yet to leak. Recently though, torrents claiming to be Windows 7 M2 have made an appearance on various P2P sites.

This "release" is a complete fake and is actually a customized version of a Vista SP1 install. It would seem that the same thing that happened with M1 is happening with M2: fake builds appear before the real ones manage to leak. There is currently nothing to imply that the fake download comes with malware, but users should still exercise caution.

Sources claim that Microsoft is currently working on M3. Microsoft has of course not confirmed either M2 or M3, but even if it did, we strongly recommend readers to stay away from pre-beta builds. The Windows 7 beta program is expected to debut sometime next year.
http://arstechnica.com/journals/micr...-sites-is-fake





Blizzard Wins Key Judgments Against WoW Bot Maker MDY on Copyright and Tortious Interference Claims
Benjamin Duranske

Blizzard has won its summary judgment motion against World of Warcraft bot maker MDY on copyright grounds. Blizzard also prevailed on its tortious interference claim. This means that liability for contributory and vicarious copyright infringement and tortious interference is completely off the table and will not go to the jury at trial in September, assuming that the parties do not settle before then. The only issue before the jury on these two claims will be damages. This is a major setback for MDY, which originally brought this action seeking a declaratory judgment that its WowGlider (now MMOGlider) bot software did not infringe Blizzard’s copyright.

For the background of this suit, see Virtually Blind’s complete coverage of MDY v. Blizzard. Here is today’s Order re: Blizzard’s and MDY’s Summary Judgment Motions (.pdf).

The Court ultimately held that:

Blizzard owns a valid copyright in the game client software, Blizzard has granted a limited license for WoW players to use the software, use of the software with Glider falls outside the scope of the license established in section 4 of the TOU, use of Glider includes copying to RAM within the meaning of section 106 of the Copyright Act, users of WoW and Glider are not entitled to a section 117 defense, and Glider users therefore infringe Blizzard’s copyright. MDY does not dispute that the other requirements for contributory and vicarious copyright infringement are met, nor has MDY established a misuse defense. The Court accordingly will grant summary judgment in favor of Blizzard with respect to liability on the contributory and vicarious copyright infringement claims in Counts II and III.

Blizzard had argued that:

In this Circuit, the “copying” element may be proved in software cases by showing an unauthorized reproduction of a copyrighted software program in the computer user’s Random Access Memory (“RAM”). The Ninth Circuit has recognized that “the loading of software into the RAM creates a copy under the Copyright Act.” MAI Sys. v. Peak Computer, Inc., 991 F.2d 511, 519 (9th Cir. 1993), cert. dismissed 510 U.S. 1033 (1994); Triad Sys. Corp. v. Se. Express Co., 64 F.3d 1330, 1334 (9th Cir. 1995); see also Twentieth Century Fox Film Corp. v. Cablevision Sys. Corp., 478 F. Supp. 2d 607, 621 (S.D.N.Y. 2007) (agreeing with the “numerous courts [that] have held that the transmission of information through a computer’s random access memory or RAM . . . creates a ‘copy’ for purposes of the Copyright Act,” and citing cases.) When such a copy is made in excess of a license, the copier is liable for copyright infringement. Ticketmaster LLC v. RMG Techs., Inc., 507 F. Supp. 2d 1096, 1107 (C.D. Cal. 2007) (‘“When a licensee exceeds the scope of the license granted by the copyright holder, the licensee is liable for infringement.”’ (citation omitted)).

MDY argued that loading a copy of the software into RAM is protected by Section 117, and was joined in that argument by Public Knowledge, a digital rights advocacy group. The court rejected these arguments, noting that “the Court is not free to disregard Ninth Circuit precedent directly on point.” From the Order:

MDY urges the Court to follow the approach recently taken by the United States District Court for the Western District of Washington in Vernor, 2008 WL 2199682. The Vernor court declined to follow MAI, Triad, and Wall Data, and instead applied an earlier Ninth Circuit case, United States v. Wise, 550 F.2d 1180 (9th Cir. 1977). Wise involved the application of the “first sale” doctrine under 17 U.S.C. § 109 to various transfer contracts between movie studios and recipients of movie prints. Vernor concluded that the critical factor in Wise for determining whether a transaction was a sale or a license was “whether the transferee kept the copy acquired from the copyright holder.” 2008 WL2199682, at *6. MDY urges the Court to follow Vernor and Wise and hold that the users of the WoW game client software are owners of the software because they are entitled to keep the copy of the software they acquire from Blizzard. The Court declines this invitation. Whatever freedom the court in Vernor may have had to disregard Wall Data when applying a different statutory provision – section 109 – this Court does not have the same freedom. This case concerns section 117, the very provision addressed by the Ninth Circuit in Wall Data. The Court is not free to disregard Ninth Circuit precedent directly on point.

MDY prevailed on some other other pending summary judgment issues and Blizzard prevailed on others, but the key result is that MDY has been found by the court to infringe Blizzard’s copyright through the sale of its WoWGlider (now MMOGlider) bot program, and to have tortiously interfered with Blizzard’s relationships with its customers through those sales. VB will be interested in seeing if MDY appeals.
http://virtuallyblind.com/2008/07/14...d-wins-sj-mdy/





Blizzard Wins Big Legal Victory Upholding Software License Rules

The Blizzard decision, if allowed to stand, could diminish consumers' already limited ownership rights over the software they buy.
Thomas Claburn

Blizzard Entertainment on Monday won a legal battle against MDY Industries, a maker of software that allows gamers automate the advancement of their World of Warcraft (WoW) characters.

The decision, if allowed to stand, could diminish consumers' already limited ownership rights over the software they buy. It could also leave consumers liable for significant financial penalties in the event of legal action.

"Stunningly, this means that 'cheating' while playing a computer game can expose you to potentially huge statutory damages for copyright infringement," said EFF staff attorney Corynne McSherry in a blog post about the ruling.

Blizzard sued MDY to stop it from selling a program called Glider, which lets Blizzard customers play WoW without being at their computers. Use of such programs violates Blizzard's terms of use under its end user license agreement. Blizzard would typically pursue a breach of contract claim against EULA violators, but in this case it sued for secondary copyright infringement and contract interference under the theory that loading a copy of WoW into a computer's memory represents copyright infringement.

In siding with Blizzard, the judge has accepted its position that MDY's actions should be judged under copyright law rather than contract law. This matters because the potential damages are much higher under copyright law.

"The decision makes anybody much more easily liable for copyright infringement when what they're doing isn't copyright infringement," said Sherwin Siy, staff attorney at Public Knowledge, a public interest advocacy group that filed an amicus brief in support of MDY. "Just by crafting an End User License Agreement cleverly, a software company takes the matter out of the realm of contract and put it into the realm of copyright."

"There are several bad things that can happen as a result of this ruling," said Lance C. Venable, a partner at Venable, Campillo, Logan & Meaney P.C., the law firm representing MDY. "What the ruling does is it allows software manufacturers to have vast powers in the EULA to control how their software is used by end users beyond the terms of a contract. It allows software developers to create their own triggers for copyright infringement, ones they wouldn't have had before this decision."

Granting such subjective power to software developers goes against the notion of an objective statute that clearly defines copyright infringement, said Venable.

There are some additional matters to be dealt with in the case, but once those are resolved, Venable said he's planning to appeal the ruling to the Ninth Circuit Court.

In a blog post, former law professor William Patry, senior copyright counsel for Google (writing as a legal scholar rather than as a representative of Google), explained that the judge managed this sleight of hand -- moving the dispute into the copyright realm -- by finding that the WoW game "even though sold over the counter, was licensed not sold." He called the court's finding "a chilling extension of control by copyright owners of software over copies of programs they have sold."

In wondering how the court could justify its decision, Patry suggested perhaps the judge was offended because MDY's software allows behavior the court regards as cheating. "If so, God help us if law is being reduced to such subjective, nonstatutory grounds," he said.
http://www.informationweek.com/story...leID=209100284





Ubisoft Steals ‘No-CD Crack’ to Fix Rainbox 6: Vegas 2
Ben Jones

“Piracy is BAD” proclaims every copyright dependent industry lobby group. “Downloading is stealing” is another popular one. How about “downloads are a lost sale”? Ubisoft clearly didn’t believe that last one, as they distributed a no-cd patch from the scene group RELOADED as a fix for one of their games.

Piracy can be a funny business at times, but the rhetoric is often extremely predictable. So when something unexpected happens it can knock you off your stride. Something like… a major game publisher distributing a Scene no-cd crack as a fix would do it, for instance. If it sounds unlikely, that’s because sometimes truth is stranger than fiction. In this case, the publisher is Ubisoft, the game ‘Rainbow Six: Vegas 2‘, and the Scene ‘no-cd’ crack – yes that’s there as well.

The situation revolves around that oddest of characters, Direct2Drive (D2D) - an online games store, owned by IGN, selling games over the Internet as protected downloads. Game code is modified to prevent the standard retail DRM from inhibiting game play (as there is no actual disc to check for) with Trymedia activation utilized instead. More importantly, since the code around the DRM has been modified and changed to a different system, regular patches from the game developers can’t be used. Instead, patches must be reworked by D2D to accommodate these changes. These changes are not always quick, a point D2D does try and defuse in its FAQ.

Thus we come to Rainbow Six: Vegas2 (R6V2) which, since its release in March, has had three patches released for it. The third, 1.03 provides a lot of changes, including new play modes, so legitimate purchasers of the game were eager to try it. The problem is, those that bought it via D2D can’t use it. This is the problem inherent in DRM. Those that buy the product are the ones affected, not those the DRM is designed to defeat.

After lots of complaining and attempts to fix things themselves, one Ubisoft employee found a solution. A zip file was uploaded to the help/support site, named “R6Vegas2_fix.zip”.

If D2D users patched to 1.02, then replaced the EXE with this one, they could then update to the new patch. However, someone ran a hex edit and it appears the fix was not Ubisoft code but actually a ‘no-cd’ crack released by the Scene group RELOADED, as shown here.

Since then, the zip file containing the fix has been pulled from the Ubisoft support site, so we’re unable to verify. The game’s community is as baffled by this as everyone else. Since the claimed origin of the fix, 10 days ago, there has been no word on it officially from Ubisoft, beyond a ‘Community Manager’ who states

We’re looking into this further as this was not the UK Support team that posted this, however if it is an executable that does not need the disc I doubt it has come from an external source. There’d be very little point doing so when we already own the original unprotected executable.

As soon as we find out more about this we’ll let you know.
_________________
Ubi.Vigil
Community Manager
Ubisoft UK

Although it is not unknown for a Scene release to be used to ‘fix’ a retail product, it’s certainly rare to have that fact promoted. That the ‘no-cd’ patch works, might have some relation to how brutal the Scene is when it comes to the quality of their work, especially in games. Whilst this is a validation that the Scene isn’t as bad as the lobby groups would have you believe (they fixed the game, and did it for free) you can bet that Ubisoft won’t be smiling at E3, and that they, and Direct2Drive, will continue to use DRM to annoy and inconvenience paying customers.
http://torrentfreak.com/ubisofts-no-...to-drm-080718/





Google Fends Off Pornographic Lively Rooms
Stephen Shankland

Google is having to work to try keeping its Lively online 3D virtual worlds from getting a little too lively.

Despite some injunctions to the contrary, sexual overtones are creeping into Google's cross between a chat room and Second Life.

"We've received complaints about recently created 'sex rooms' in Lively, and we take these complaints seriously," Google said on its Lively group. "Our community standards prohibit sexually explicit images and rooms intended for sexual activity, even if virtual. When we become aware of 'sex rooms' that violate or Terms of Service, we'll work to remove them."

A little snooping around revealed some evidence of borderline rooms, but nothing as risque as shows in the more permissive realm of Second Life.

"So the girls are hidden in here," griped one avatar in one room called SEXY & HOT Monday morning. "Show up," ordered another. There wasn't much in the way of naughty pictures beyond the welcome screen, but some posters in the room linked to girl.cb-w.com, a Web site that sells a guide about "How To Approach Any Woman, Anywhere And Know Exactly What To Say To Get Her To Give You Her Number And Go On A Date With You - NOW."

Another room, called porn place, seemed fairly tame--even the YouTube video playing on the bottom of the pool. Other rooms were called Sexo Virtual, sexy babes, and BDSM Espana.

Google Lively's community standards prohibit nudity and sexually explicit material: "We don't allow nudity, graphic sex acts, or sexually explicit material. This includes making sexual advances toward other users. We also don't allow content that drives traffic to commercial pornography sites or that promotes pedophilia, incest, or bestiality. Google has a zero-tolerance policy against child pornography. If we become aware of child pornography, the content will be removed and we will report it and its owners to the appropriate authorities."

Google wants to keep it clean for mainstream users, and users who violate Google's terms could find themselves banned from Lively and their Google account disabled, Google said.

"When browsing or searching for rooms, some Lively citizens come upon these rooms as the top results, which can erode their Lively experience...Lively is intended to be a place for Lively citizens to connect with each other and express themselves freely and in a safe environment," Google said.
http://news.cnet.com/8301-1023_3-9990371-93.html





ISPs Nationwide Unite in Attack Against Exploitation
Thomas Mennecke

ISP-based newsgroups have taken a beating in the last month, as New York Attorney General Andrew Cuomo's initiative against child pornography has forced many of the more popular newsgroup hierarchies offline. Verizon, Sprint, RoadRunner, and late last week, AT&T, have all acted on the Attorney General's recommendation. Today, the National Cable and Telecommunications Association (NCTA) announced a "historic" agreement where all member companies have entered into a MOU (Memoradum of Understanding) with the National Center for Missing and Exploited Children (NCMEC) and the National Association of Attorneys General (NAAG) to attack child pornography on their servers and networks.

The exact details of the MOU is unknown, as Rob Stoddard, Senior Vice President of Communications for the NCTA, informed Slyck.com that the information contained in the MOU is not releasable. However, it's rather clear from the press release that the fight initiated by Andrew Cuomo is now taking on nationwide proportions. NCTA is the premier organization that represents the telecommunications industry, and today's announcement has the endorsement of every member.

Those who signed on today are as follows: "Comcast Corporation; Cox Communications; Charter Communications; Cablevision Systems Corporation; Bright House Networks; Suddenlink Communications; Mediacom Communications; Insight Communications; Bresnan Communications; Midcontinent Communications; Broadstripe; GCI; Harron Communications; US Cable Corporation; BendBroadband; Eagle Communications; and Sjoberg’s, Inc. Time Warner Cable has already signed the MOU."

This total number of ISPs represents 87% of all carriers, providing connectivity to 112 million individuals. From the press release, it's difficult to gauge what Internet medium will be targeted. However, the statement does offer the following:

"Specifically, the cable companies have agreed to use NCMEC's (National Center for Missing and Exploited Children) list of active websites identified as containing child pornography, to ensure that no such site is hosted on servers owned or controlled by those companies. The companies will also report these instances to NCMEC's CyberTipline and where appropriate revise their policies around other potential sources of child pornography, such as, for example, newsgroups."

Slyck followed up with Rob Stoddard, who told us the list referred to in the press release was a "prospective statement". A representative from NCMEC clarified that the agreement is protocol agnostic, and their targets change as content appears. If the past is any indication of what's in store for ISP customers, the newsgroups may very well be a prime target.

The move garnered support from 45 Attorneys Generals. In a letter to the NCTA, Attorney General Patrick Lynch of Rhode Island and President of NAAG, offered his congratulations on the agreement.

“I commend the nation’s cable operators for utilizing the National Cable and Telecommunications Association (NCTA) to negotiate and collectively enter into a unprecedented industry-wide agreement with the National Center for Missing and Exploited Children (NCMEC) to limit the availability of child pornography on the internet.”

What this means for the newsgroups is unknown at this time, however as ISPs begin to enact the MOU, the repercussions of this agreement will likely be felt throughout the online community.
http://www.slyck.com/story1715_ISPs_...Exploitati on





Why ISP's 'Stand' Against Child Porn Is Actually Not A Stand Against Child Porn

Following NY Attorney General Andrew Cuomo's success in getting ISPs to turn off Usenet access and pretend it was a victory against child porn, a bunch of cable providers under the umbrella of the NCTA have announced an agreement with 45 attorneys general, claiming that they, too, are taking a "stand against child porn." This "stand" is the same as what Cuomo pressured ISPs to do: officially it's to block any newsgroup or website that is "known to host child pornography." Taking a stand against child pornography would be a good thing -- but this is not actually a stand against child pornography. This is trying to sweep a problem under the rug so that some politicians and some companies can get some good headlines.

Taking a stand against child porn wouldn't be overly aggressively blocking access to internet destinations that may or may not have porn (and there's no review over the list to make sure that they're actually objectionable). Taking a stand against child porn would be hunting down those responsible for the child porn and making sure that they're dealt with appropriately. Blocking access to some websites doesn't solve the problem. Those who still produce and make use of child porn will still get it from other sources -- but it will be more underground, making it more difficult for authorities to track down. Also, this sets an awful precedent in that the ISPs can point out that it's ok for them to block "objectionable" content where they get to define what's objectionable without any review. For those folks who support network neutrality, this is highly questionable, because it's clearly going against the basic principles of network neutrality -- but in a way no one will protest because they don't want to be seen as siding with child pornographers. But the truth is this "stand" against child pornography won't do anything to stop child pornographers other than making them harder to track down -- and it sends these ISPs down the slippery slope of getting to decide what they think is objectionable content that should be blocked.
http://techdirt.com/articles/20080717/1918171715.shtml





‘Sesame’ Upgrading Its Address on the Web
Elizabeth Jensen

Nearly 40 years ago “Sesame Street” forged a new path in educational television for preschoolers. But in recent years, as even very young children have migrated online, the show’s Web efforts have lagged far behind those of commercial competitors like the Walt Disney Company and Viacom’s Nickelodeon.

The show’s nonprofit parent, Sesame Workshop, hopes to change that on Aug. 11, when the new Web site sesamestreet.org goes live. Developed over two years at a cost of $14 million, the site is making its debut the same day as Season 39 of “Sesame Street,” seen weekdays on PBS. Kept under tight wraps until now, the site will be previewed for some in its target parent audience at the BlogHer conference for female bloggers in San Francisco this weekend.

While there are no plans to discontinue the television show, Sesame Workshop officials have high hopes for the broadband site. “We view this as really the future of the workshop, as becoming the primary channel of distribution down the line,” Gary E. Knell, president and chief executive of Sesame Workshop, said in a telephone interview.

Mr. Knell has set ambitious goals for the new site, asking the staff to double the use of the current site — about 1.5 million unique users each month — in just a year or two, he said. The television show, by comparison, draws six million to seven million weekly viewers, on average, he said. (Older “Sesame Street” episodes are shown on the cable channel PBS Kids Sprout, a joint venture of PBS, Sesame Workshop, Comcast and Hit Entertainment.)

A robust Web site is a necessity for children’s television companies, said Sandra L. Calvert, director of the Children’s Digital Media Center at Georgetown University. “Children expect it, and parents expect it,” she said. “Parents overwhelmingly think that computers are the gateway to children’s futures.”

But the sites are expensive to develop. And unlike Nickelodeon, Disney and Time Warner, which Mr. Knell said control about 80 percent of the worldwide children’s television market, Sesame Workshop has a limited number of other on-air opportunities to promote its site, making the challenges all the greater.

“For Sesame as an independent producer to try to compete for eyeballs, we’ve got to be proficient technologically and innovative in content,” he said.

Like the “Sesame Street” television show, the site was based on research. In this case it involved about 100 children of all socioeconomic levels at three preschools in the New York area, said Glenda Revelle, vice president for research for Sesame’s digital content. The research found that children did not want a linear televisionlike experience on the Web site, she said, and that online as on television, they responded strongly to having a Muppet guide them.

So unlike other Web sites, which rely heavily on Flash animation, this one features a live-action Muppet video that welcomes children with a new educational theme every day.

Perhaps equally important is a feature that children will not even notice: a proprietary, trademarked option, known as PlaySafe, intended to reassure parents. When the downloadable PlaySafe software is activated, it is technologically difficult for children (but not adults) to navigate away from the site, so parents can theoretically leave children alone in front of the computer without worrying that they will accidentally stumble onto inappropriate content, buy something or delete files.

Although many early-childhood experts strongly recommend that parents and children use educational Web sites together, the reality is often different. None of the other major children’s educational play sites has such a feature, Workshop officials say. The system was developed in conjunction with Cignex and Firefly Interactive.

Each day on the new “Sesame Street” site, the Muppet video will welcome children with a different theme, be it “the number 5” or “sharing.” The Muppet will point children to a big green button, which starts a daily playlist of seven short alternating videos and games tied to the theme.

Using a simple design scheme, the site’s content, including 3,000 videos and 400 games, is reached via areas for games, videos and customizable playlists. There’s a section where the content is organized by specific Muppet, and a “My Sesame” area for saving favorites. Some games use a keyboard, for children who don’t have the motor skills for a mouse, and many use video, not animation. Segments for some new video-based Web games were filmed at the same time as the television show, said Miles Ludwig, vice president and executive producer of Sesame Workshop’s Digital Media Group, adding that a year from now the TV-Web crossover will be even more extensive, “to deepen the learning.”

As on the current site a big yellow star replaces the arrow cursor, and links are surrounded by sparkles, concepts that are easier for young minds to grasp, Ms. Revelle said.

The site will be free, supported by sponsorships at the bottom of the page aimed at parents, and by a request for donations, to underscore the workshop’s nonprofit status. “We won’t do marketing to kids,” Mr. Knell said.

By contrast, commercial rivals like Nickelodeon’s Noggin, and even PBS, have begun paid Web sites, to complement their free sites. “We felt subscription violates the mission of what we’re trying to do here, which is to reach as many kids as possible with our content,” Mr. Knell said.
http://www.nytimes.com/2008/07/15/ar...on/15sesa.html





What Mainstream Publishers Don't Want You to Know About Door-to-Door Magazine Sales

That kid at your door with a magazine order form will tell you a story -- part sad, part hopeful. The truth will be infinitely worse than you can imagine.
Craig Malisow

In the Ramada Inn, across I-10 from Ikea, dozens of young sales agents spill out of vans and head for the first-floor conference room. They're in their late teens and early twenties, tired from a long day of selling magazine subscriptions door-to-door, but excited about the money they
Crystal Mahathy was working at an Arby's when she was recruited to sell subscriptions.

Rick Senner, who was driving the SUV that plunged off a cliff and killed two crew members, celebrates Jesus Christ's birth with the lighting of special frankincense.

Love Technologies' MySpace says its agents "take whatever necessary steps towards quality and prosperous living." Indicating the rigorous background checks this industry prides itself on, the company promises: "Call today/Start today."

John Tork's company cleared subscription orders through the late Robert Spruiell. He served three years in a Texas prison for larceny.

James Scribner runs Team-Xtreme, which cleared orders through the late Robert Spruiell. "Scribs" said the media only focuses on the "negative" side of the industry.
Subject(s):
door-to-door sales, magazine sales crews, subscription clearinghouses, publishing industry, deceptive sales tactics
think they're going to get.
Crystal Mahathy was working at an Arby's when she was recruited to sell subscriptions.

Rick Senner, who was driving the SUV that plunged off a cliff and killed two crew members, celebrates Jesus Christ's birth with the lighting of special frankincense.

Love Technologies' MySpace says its agents "take whatever necessary steps towards quality and prosperous living." Indicating the rigorous background checks this industry prides itself on, the company promises: "Call today/Start today."

John Tork's company cleared subscription orders through the late Robert Spruiell. He served three years in a Texas prison for larceny.

James Scribner runs Team-Xtreme, which cleared orders through the late Robert Spruiell. "Scribs" said the media only focuses on the "negative" side of the industry.
Subject(s):
door-to-door sales, magazine sales crews, subscription clearinghouses, publishing industry, deceptive sales tacticsIn the
conference room, a line of middle-aged managers sit behind folding tables and count the stacks of receipts and cash their agents place before them. It's a ton of money. The crews hit Houston in late February, it's near the end of March now and it's been a lucrative stay. Houston is always a windfall.

It's been a tough hop for this caravan of sales crews, though. Winding their way down from California, they lost a few agents. Two were arrested in Albuquerque after they allegedly forced their way into the home of an elderly couple and beat them to death, raping the wife first. A few weeks later, another agent allegedly raped a woman in Claremont, California, so he got picked up, too. Then, in West Texas, a van flipped, killing one agent and injuring three others. That's seven agents out of commission. That's about a $2,800 loss per day.

After they turn in their cash and receipts, two agents, a pudgy girl and a lanky guy, hit the parking lot for a smoke. Two Houston Press reporters are there, observing. Without knowing they're talking to reporters, the agents walk over and ask for rolling papers. When asked what they're doing in town, the agents explain their job and how much they love it. It's a blast, they say. You lie all day to sell subscriptions, and you unwind afterward with some smoke. You tell the customers that you live a few streets over, that you go to the local school and play on the soccer team, that you just sold subscriptions to their neighbor, and the idiots buy it because by now you've got it down to a science. And on to the next town. And the next.

In the eight months the Press investigated door-to-door magazine sales across the country, the industry has seen at least three murders, one rape, two attempted rapes, one stabbing, one attempted murder, one vehicle fatality and one attempted abduction of a 13-year-old girl.

Interviews with former agents reveal a constant party atmosphere where agents have easy access — often thanks to their managers — to drugs. The agents come primarily from two populations: reprobates who need to leave wherever they are fast, and vulnerable kids from unstable families who believe that hopping into a van full of strangers is better than what awaits them at home.

Crystal Mahathy is an example of the latter. In 2000, the 17-year-old crossed paths with a Texas-based magazine crew manager named Rick Senner.

Rick Senner got his start working for Russell Wood, one of the industry's biggest names. Senner started as an agent under Wood, who's based out of the hinterland of Pilot Point, Texas, about 50 miles north of Plano. Senner worked his way up from agent to crew manager, and later left to start his own company. When he's not on the road, Senner is with his wife and daughter at their home in Gainesville, just a few miles from Pilot Point.

Senner's crew was working Mahathy's hometown of Fort Wayne, Indiana, when he spotted her in an Arby's and figured she would make a good agent. Senner is six-one, blond, handsome and has the kind of confidence that allowed him to shrug off things like the warrant for his arrest out of Phoenix, where he was busted for weed and was a no-show at court. He offered a way out of Fort Wayne, and a way out of Mahathy's mixed-up family life. But first, because she was under 18, Senner wanted her mother to sign a permission slip. Because her mother is illiterate, Mahathy got an older cousin to sign for it instead. With that taken care of, she was able to hit the road. She made money for Senner, who made money for his boss, who in turn made money for major-league publishers.

Like many agents, the teenage Mahathy didn't know what she was getting herself into and how hard it was going to be to get herself out of it. Senner and his colleagues have a great sales pitch, and truth doesn't always close the deal.

Agents are often driven across the country by managers whose driver's licenses have been suspended or revoked. And while the industry's trade group says it encourages member companies to conduct background checks, the crews are overflowing with agents with open warrants, extensive criminal histories and probation terms that prohibit them from leaving their home state. Since its inception in 1987, the National Field Selling Association has not only done nothing to clean up the crews, it has lobbied against proposed legislation that would implement the most basic of safety regulations and prohibit the hiring of underage employees.

While mainstream publishers and their trade group, the Magazine Publishers Association, say door-to-door sales account for a minuscule percentage of annual sales, this seemingly small percentage still translates into millions. It's profitable enough to publishers like Condé Nast, Reader's Digest and others that they still consider door-to-door sales a worthwhile venture in the 21st century. And without publishers' participation, the industry would cease to exist. Which means, quite simply, that publishers have decided the collateral damage is worth the boost in circulation.

The following is a story of that collateral damage — of murder, rape, assault, overdoses and scamming — and the business decisions and lack of legislation that make it possible.
_____________________

In February 2000, Rick Senner, Crystal Mahathy and the rest of Senner's crew hit a rave party in Oakhurst, California, where they recruited an 18-year-old girl named Mandy Nixon.

When Nixon told her parents she wanted to drive around the country with Senner's crew, they were concerned. Nixon was a bit of a rebellious spirit. As a minor, she had trouble with drugs and alcohol and wound up on juvenile probation for a while. But Crystal Mahathy, who had turned 18 on the road, told the Nixons she'd look out for their daughter.

But a day or so after Nixon left, her parents read about the history of complaints online about All-Star Promotions, Senner's employer, and they grew concerned. They called Senner a few times to have him drop off their daughter wherever they were so they could bring her back home. But he ignored the calls. Deciding they needed more muscle, they had Nixon's former probation officer call Senner and tell him he had better get Nixon off his crew, so he dropped her off by a motel outside Medford, Oregon.

Although Mahathy said she'd look out for Nixon, Mahathy was having her own regrets about joining Senner Sales. She had called her Aunt Patsy a few times from the road, saying she wasn't getting the money she was promised, and she wasn't eating regularly. She wanted to come home. But Patsy never seemed to have the money for a Greyhound ticket.

On February 4, around the time Senner dropped Mandy Nixon off in Medford, Mahathy called Aunt Patsy from a pay phone outside a Wal-Mart. It had been a really long day; she hadn't made enough sales, and she felt really pressured. That time, Patsy told her to stay put. They'd get her a ticket. But the call was abbreviated; Mahathy had spotted Senner's rented Ford Explorer and she said he'd be mad if he found out she was calling home again. She'd call back later.

The next night, on their way to sell to Joneses in Eureka, California, Senner's crew was stopped by California Highway Patrol officers for driving 30 mph over the speed limit. Apparently unaware that Senner had a warrant for pot possession out of Phoenix, the officers gave him a citation and let him go on his way.

Less than an hour later, near Redding, Senner rounded an especially dangerous stretch of mountain highway running parallel to the Trinity River. With no guardrail, and with terrible visibility at night, the road had seen its share of accidents. Senner lost control of the Explorer and drove off the highway, falling into an embankment 80 feet below.

Passenger Scott Tarwater was ejected into the Trinity River, whose rapids carried him so far away his body wasn't found for three weeks. But a timely burial wasn't a problem for Mahathy's family, because she was right there in the passenger seat. Crushed to death.
_____________________

Whenever there's a tragedy tied to the industry, whether it be the death of one of the agents or of one of the customers, the industry mouthpieces issue impotent condemnations or reiterate the notion that door-to-door sales are just a sliver of the pie.

The Magazine Publishers of America will give a variation of the following, which is a statement it gave to the Press: "Magazine Publishers of America condemns any door-to-door business that preys on vulnerable individuals or poses a threat to the public. [MPA] has long urged its members to identify any subscriptions coming from these sources and recommends that its members cease doing business with any company that does not fully comply with the law. Our guidelines and relations with subscription agents are clear, and we encourage all our members to follow them."

Which, based on the Press's investigation, previous media stories and industry watchdogs, is complete nonsense. The object is to push subscriptions, and it scarcely matters how.

A customer is a "Jones." A sales pitch is a "spiel," and there are all kinds of spiels — a school-spiel, cancer-spiel, you name it. These lies are known as a dirty canvass, and they're quite successful. Of course, there are natural salespeople who don't have to dirty canvass and can write ten or 12 sales a day, but the agents who can't snow a Jones and who come back empty-handed are known as WABs, weak-ass bitches. A WAB occupies a stratum in the caste system right below circus freak and just above whore. No one wants to be a WAB, so sometimes you have to dirty canvass.

If the MPA is unaware of dirty canvassing, then its only other choice is to somehow believe that door-to-door companies are the country's single-biggest employer of college athletes in the marching band whose parents are dying of cancer and who are competing for a scholarship to study theater in London.

It's easier to understand the continued interest in door-to-door sales once you understand the financials.

Jack Hanrahan, a media consultant with three decades of experience in print advertising, publishes the CircMatters newsletter. He gave us a better understanding of how just a slight bump in circulation can mean serious money.

When magazines decide how much a page of advertising will cost, media buyers convert that into a ratio of cost-per-thousand.

Say the publisher of a magazine with a circulation of 1 million copies prices each page of advertising at $50,000. That's a cost-per-thousand of $50. Say the circulation jumps 50,000, which brings total circulation to 1.05 million. If the publisher keeps the cost-per-thousand at $50, that raises the single advertising page rate to $52,500 ($50 x 1,050).

If the magazine sells 100 pages of advertising per issue, then the total value of the 50,000 jump would be $250,000 per issue. ($2,500 per page x 100 pages). If the magazine runs 24 issues a year, that's 24 x $250,000 — $6 million, from an extra 50,000 copies.

That's enough incentive to keep using sales agents. Of course, publishers don't want to be linked to any of the kids knocking on the doors, so the system has been arranged to keep everyone at arm's length.

It works like this: Agents knocking on doors turn their sales receipts in to their managers, who send them off to clearinghouses. A clearinghouse submits the subscription orders to the publishers, who then mail out the magazines. The clearinghouses choose which traveling sales crew companies to work with; the heads of those companies usually have their managers do the hiring. This arrangement allows the publishers, clearinghouses and road crew company heads to pretend they have nothing to do with the kids pushing the publishers' product.

The real blessing for everyone, though, comes in a labor loophole: Even though a crew's agents ride in the same vehicle, are dropped off in the same neighborhoods, are returned at night to the same hotels and have commissions held by managers who dole out the cash when an agent wants to buy lunch or alcohol or a new pair of shoes, labor laws have allowed company owners to hire their agents as "independent contractors." Since the crews rarely have solicitation permits, if they are arrested for selling without a license or for any other matter, they are instructed to tell authorities they are not in fact employed by the company they're traveling with.

The companies that run the crews primarily hire through newspaper advertisements promising big money and free travel. The ads are generally placed when the crew hits a town; the prospective hires meet a crew manager at a hotel and are usually hired on the spot. Although they're promised about $500 a week, their money goes on "the book," a mysterious ledger kept by crew managers. Often, agents will start out in the red, already owing managers hotel rent money. Managers also dock pay for canceled orders or other so-called infractions.

Agents sell from a "hot-list," laminated brochures of magazine titles, usually provided by clearinghouses, that agents show their Joneses. The agents work on a point system; the hot-lists show the points each agent would get for a particular subscription. For example, a 2006 hot-list from the National Publishers Exchange, one of the country's largest clearinghouses, shows 40 points for Reader's Digest and 80 points for GQ. According to the titles on the hot-list, the agents were selling for — and NPE was clearing orders for — Condé Nast, Disney Publishing, Meredith and others. (While the list also includes titles from Hearst, a company spokesman told the Press, "A written directive was sent in January 2007, but most clearinghouses were alerted to our policy against accepting orders from door-to-door 'crews' years earlier." A Meredith spokesperson said the company de-authorized door-to-door sales in March 2007.)

Every link in the chain holds the door-to-door sales information close to the vest. Citing proprietary interests, publishers will not disclose their clearinghouses, and clearinghouses will not disclose their contracted magazine crews. Since there are only a handful of major clearinghouses in the country, publishers would have you believe that, after years in the industry, higher-ups are too incompetent to have figured out who their competitors clear through.

National Publishers Exchange was a member of the National Field Selling Association (NFSA), the trade group for door-to-door magazine sales companies. In 2006, the association stopped disclosing its membership, so it's difficult to tell if NPE is still a member.

The NFSA will not say why it decided to keep membership private, but that's not surprising for a trade association that doesn't even have its own office — instead, mail and phone calls are directed to the Philadelphia office of Fernley & Fernley, which prides itself on being "America's First Association Management Company."

And while Ellen Buckley handles preliminary media calls for the NFSA, she doesn't seem to know a whole lot, mostly because she wears a lot of hats. While she may be listed as the "director" of the NFSA, she is also, for example, Administrative Director of the North American Horticultural Supply Association, which means she doesn't just field calls about mag crews, but could probably also help with questions about mixed perennials and potting soil.

So for tough questions, Buckley refers reporters to the NFSA's Washington, D.C., attorney, Dan Smith. Smith has lobbied for the group, most notably in 2000, when legislators proposed the federal Traveling Sales Crew Protection Act. The bill was a response to a 1999 wreck in Wisconsin that killed seven agents and paralyzed another. It occurred when the 20-year-old driver of the van — whose Iowa license had expired and who previously had his Wisconsin driving privileges suspended — saw a police car and panicked. Not wanting to get busted again, he tried to change seats with a passenger while driving 80 miles per hour. The coordination was a bitch. Twelve passengers were ejected. The owner of the company the crew worked for never skipped a beat — she just hired a bunch of new kids and started up under a new name. Smith was the guy who handled the lobbying against the proposed safety act — lobbying that worked.

The bill called for making sure crews stayed in hotels that met certain safety guidelines, and making the companies keep an itinerary of where their crews were at any given time. Such a schedule would have helped when, in Houston in 2005, a sales agent raped a 17-year-old mentally retarded girl who answered the door of the apartment she shared with her mother. To gain her confidence, that agent acted as if he had a disability as well. If the Traveling Sales Crew Protection Act had passed intact, there's a very good chance authorities would be able to find out which crews were operating in Houston on June 5, 2005. As it is, the case remains unsolved.

Although Smith says otherwise, when it comes down to it, the NFSA doesn't appear to do much except hold an annual conference in Illinois where members gather to play golf. Smith says actual work is accomplished at the conference, such as the year a cop talked to company owners about driving safety, and another year when a CPA discussed tax preparation. Smith says he's also given talks about negligent hiring. (After 20 years, the NFSA members are still scratching their heads over this pesky "driving safety" thing. Seven years before the fatal Wisconsin wreck, an agent driving a van with only a learner's permit lost control in Des Moines, Iowa, hit a median, flipped the van and ejected nine passengers. Five were killed, six others injured.) (see "Cataloguing Grief").

In its newsletters, the NFSA is careful not to mention names of the sales agents, particularly those who die on the job. In its fall 1999 newsletter, the first one released after the Wisconsin tragedy, the lead article was the president's message on "Stating the Cause for Utilizing Prepaid Phone Cards in the Field," followed closely by "Small Wonders," a reflection on "the simple discoveries of the century." Sample passage: "Where would we be without the brassiere, first patented in 1914, or the zipper, patented in 1913? Could those inventions be related?" (For the record, the sales agents killed in Wisconsin were Peter Christian, 18; Cory Hanson, 22; Amber Lettman, 16; Crystal McDaniel, 26; Marshall Roberts, 16; Malinda Turvey, 18; and Joseph Wild, 21. Monica Forques, 16, was paralyzed from the waist down).

Of course, it's different if one of their own dies, as in the January 2006 newsletter's tribute to founding member Don Fish: "The next time you pick up a golf club, look up and say, 'Good luck, Don' — he will be playing with the greats of the game." (The NFSA named its annual golf tournament after Fish, who had the opportunity to die at age 74).

Smith talks in a sort of aw-shucks manner that would have you believe he wishes the NFSA could do more to ensure the safety of its agents and the Joneses they solicit. But don't think the trade group is just giving up — after 20 years of existence, the NFSA is toying with the radical notion of mandatory background checks. The bitch is, the NFSA has to be really careful about violating antitrust laws that limit the rules trade groups place on their members. So Smith says the NFSA probably has to stop just short of forcing members to conduct background checks.

"We can mandate that in order to be a member you must agree to do background checks," he says, adding that the NFSA would have no way of confirming if any of the companies ever did the checks.

"We can't force proof," Smith says. "The name of the game is, we're a trade association...the key is, you can't tell people how to run their business."

Furthermore, Smith was at a loss as to how someone might be able to confirm a company did the checks in the first place.

Citing privacy laws, he says, "You can't conduct background checks and send copies to a trade association to show you did it," apparently unaware of the fact that one of the NFSA's board members runs a service that audits companies' criminal background checks.

"The name of the game is whoever's doing the recruiting has got to run the background check," Smith says. "They've got to determine from what they see whether or not to put this guy out there or not. Now if they do it and screw up, then shame on them, but I'll find out after the fact, just like you do. Now can I do anything about it? The worst thing, the toughest thing I can do is to terminate their membership. I wish there was something else I could do, to be brutally frank, but there isn't any."

But if Smith has the power to jettison any owner who gets caught not running checks, he apparently hasn't been introduced to the NFSA's president, Vinnie Pitts. In 2000, after one of Pitts's agents murdered a woman in New York, the woman's family sued Pitts, who eventually settled for $1 million. The woman's sisters told local papers that they believed Pitts would now conduct background checks for sure. But in 2005, another of Pitts's agents — who was on probation for felony burglary out of Minnesota and was not supposed to leave the state — raped and beat a woman in Wisconsin (see "Sales Force").
_____________________

Back in the Houston Ramada, 79-year-old Diane Tork is in Room 301, smoking 100s, punching numbers into her calculator, taking calls on her pink cell and sifting through names and numbers of potential hires. Age has been kind to her body, but not so much her mind.

She'll get confused and send wrong birthdates back to the home office for criminal background checks, but of course it doesn't really matter anyway, because the checks are worthless. Only a formality. The kind of checks where you really don't want to find anything.

Tork says she started in the business on December 21, 1945, when she was 16. She eventually ran her own company, then took over for a company out of Spring when that owner died in the early 1990s. She worked alongside her now ex-husband, John Tork, who is 20 years her junior.

John Tork also had his own company, the Houston-based Tork & Associates. In 1992, the Federal Trade Commission sued Tork's company for violating the "cooling-off" period, which allows customers three days to cancel an order. After Tork failed to respond to the suit, a federal judge fined his company $50,000. A year later, Tork was convicted of larceny and sentenced to three years and six months in a Texas prison.

Diane says she and John, who share a home in Atlanta, Georgia, are semiretired. John has long suffered type 2 diabetes, and recently had a foot amputated. Diane has been off the road for a long time and only pops into hotels to check on things once the crews are about to hop.

Her company is called Prestige, which clears orders through a Phoenix clearinghouse owned by the late Robert Spruiell (see "Upper Management"). Joining Prestige on this hop are at least two other companies — it's not uncommon for supposedly distinct companies to travel together. And it's not uncommon for these groups to say they have no idea what the other is up to, which is what Diane Tork tells the Press.

She can't speak for Team-XTreme, which is run by a guy named James Scribner, who was described as an alcoholic by every ex-agent who spoke to the Press about him. Diane Tork doesn't disagree with that characterization, saying, "He's a drunk. I've heard that he will take his clothes off and run around the hotel naked — never around me." ("Scribs," as he's known, is just one of the industry's many middle-aged men whose jobs require them to travel around the country in vans loaded with women in their late teens and early twenties, something that apparently creeps out no one in publishing. A few former agents accused Scribs of getting a tad too friendly with them when he was on a binge. One former agent said, "If you're 18 years old, he wants to fuck you. He's a dirty, nasty old man. I do not like that guy.")

Diane says she runs a tight ship: Her agents aren't allowed to bring alcohol inside the hotel. She also says her agents are periodically drug-tested. And if she hears any of them are using a dirty canvass, they're out. She says she's had to fire about 15 agents in the past month for failing drug tests and lying to Joneses.

The kids can be a handful. Yet it's precisely these kind of troublemakers that Diane targets, mostly because, according to her story, she's a philanthropist at heart. Sure, she could hire upstanding kids from stable families who are maybe looking for a summer job before going off to Harvard, but that would just be too damn easy. She'd rather take in needy kids and nurture their self-respect by giving them a job and responsibilities.

"Kids today, their parents don't want to talk to them; they throw them out on the streets...sometimes these kids need help," she says.

So she can be stern, but maybe not as much as her ex-husband John, who, she says, is especially hard on the young women in his crew.

"He hates girls," she says. "You know why he hates girls? He thinks they're all sluts. And he gets so mad that girls go around with half of their body hanging out...he doesn't like his guys associating with the girls." (John Tork didn't return numerous voice mails).

But deep down, she says, he's a softie. And neither he nor anyone else in the mag crew business should be painted with the same brush, she says. There are good and bad in every line of work.

It's a sentiment that was echoed by a lot of people contacted for this story. The media always wants to focus on the negative. Why talk about things like agents on probation who beat, rape and kill people when you can talk about kids who are honing valuable job skills?

James Scribner originally agreed to speak with the Press, but ultimately changed his mind, because of his belief that the Press just wanted to focus on the "negative."

Of course, Scribs and Diane Tork have a point. Few media stories describe how fun life on a mag crew can be — if you're not a WAB. First of all (based on what ex-agents told us), there is nearly unlimited access to marijuana, cocaine, pills and meth. It's like an especially fun dormitory on wheels. A lot of these young adults were already using before they joined crew, and find it absolutely wonderful that there are jobs where you can be high all the time, and instead of your boss caring, your boss is getting high with you.

You also get to travel the country, which means you get to experience Ramadas and Holiday Inns from coast-to-coast, as well as seeing the country's beauty from a van window. Plus, you get to knock on doors in exciting tourist destinations like suburban Houston, suburban Phoenix, suburban St. Louis and suburban #Minneapolis.

For the guys, there's potential to get laid like crazy. Since crews are constantly picking up new agents, if a guy isn't getting anywhere with the current batch of young women, he just has to wait about 24 hours before the new batch arrives.

For the female agents, there is the promise of finding a boyfriend. A lot of serious relationships start on the road, and many lead to marriage. There are drawbacks, though; the Press spoke with a few female former agents who say their managers coerced them into getting abortions because a pregnant agent can't be walking all that much, and, really, who wants to buy a magazine subscription from a knocked-up 18-year-old? The idea is to appear innocent, not coked-out and with child.

Sure, if sales are bad, you don't always get to eat, and if you complain, managers often remind you of your station in life, and how your own family didn't want you, and besides, what the hell else are you going to do with your life? The agents who do manage to leave often come back because the lifestyle has gotten in their blood.

An agent named Jenn (she asked that her last name not be used) told the Press about returning to her crew, even though she knew it was bad for her. Jenn was hired in 2006, when she was 22 and hiding from her abusive boyfriend in a North Carolina women's shelter. Traveling around in a van seemed like a nice change of pace, so she answered an ad in the paper for Sunshine Subscription Agency, and met up with the crew manager, a 34-year-old guy who had served time in a Florida prison for burglary. She left with him that day.

She enjoyed the constant partying but had disagreements with the company owner (Vinnie Pitts, the current president of the NFSA), so she left after only a few months. But when she got home, she was freaked out by how quiet and slow things were. Her thumbtack habit grew worse — on the road, she would steal thumbtacks from bulletin boards and poke herself. She didn't know why. Once home, though, she was driving the suckers all the way in.

"I had not been alone for two months," Jenn told the Press. "I was so used to — no matter where I was, whether I was going to the bathroom, whether I was walking to the ice machine, I was never alone. And then all of a sudden, I was."

She added, "Physically, I couldn't be still, because my body was used to walking miles and miles a day, that if I didn't walk anywhere in one day, I would have these muscle spasms all over my body. And so I would walk for hours."

So she went back to the crew and got what she needed; the excitement, the friends, the exercise, the drugs. All fun things. Which goes to show that there is a positive side to this story.
_____________________

A year after the Wisconsin wreck, that state's governor, Jim Doyle, sent letters to the publishers of the magazines sold by the crew.

In his letter to Condé Nast, specifically citing the magazine Allure, Doyle wrote, "Our complaints document a pattern and practice of illegal conduct and deception in the marketing of your magazine. Unfortunately, last year's accident in Wisconsin was not an isolated incident. Other young people and adults have been killed in other states while working for itinerant sales crews. Young people are recruited to sell your publication with promises of extensive travel, wealth and college scholarships. Once employed, they are treated like animals."

He then laid the final responsibility at the feet of Condé Nast: "As a major publisher, you have the ultimate responsibility for the way your magazine reaches the public. You also control the purse strings because you pay these companies for obtaining new subscriptions. Clearly, you are in the best position to ensure that these companies obey the law and do not risk the lives of the children representing your product."

To date, Doyle appears to be the only politician who has called the publishers on their complicity in the door-to-door trade. However, it appears his words didn't quite sink in.

Two months after his letter to Condé Nast, he got a response not from the publisher, but from a lawyer for the Magazine Publishers Association, displaying that organization's uncanny ability to speak out of both sides of its mouth.

Attorney John Hadlock wrote that, to the best of his knowledge, the company running the crew in the Wisconsin wreck was not authorized by the publishers or the clearinghouse the company used. (This, of course, is an unverifiable statement, since all of the information is closely guarded).

Hadlock continued: "...And substantially, all of MPA's member publishers have taken steps to disassociate themselves and their magazines from road crew agents known to have acted unethically...."

And then, "The publishers would like to work with state and federal regulators to have a central clearinghouse of agents that are believed to be unethical or that violate the law. For antitrust reasons, MPA has been unable to create such a list for fear that that would be deemed an unlawful boycott."

A careful rereading of those passages presents a paradox: How were MPA's members able to "disassociate" from agents "believed to be unethical," unless they knew which agents had bad records and which were kosher? Presumably, one would have to work from a list in order to make disassociation possible.

Yet, "MPA has been unable to create such a list" for fear of inviting accusations of antitrust violations. So which is it? Either there is a list or not. Apparently, the likes of Condé Nast are afraid of being sued by people like Rick Senner and Vinnie Pitts, which would indicate that Condé Nast doesn't have much in its budget for hiring decent attorneys.

Hadlock ultimately blamed these unfortunate situations on the industry's bogeymen, the nefarious bunch of unauthorized sellers known as "rogue agents."

"Magazine publishers see such unethical agents as a serious problem," Hadlock wrote. "Agents of that type are quick to disappear when they are under scrutiny, only to reappear later under a different name and at a different location."

Although Hadlock's letter acknowledged the Wisconsin wreck, the MPA never issued a public statement on the tragedy. It was a sensitive time for them — it was the same year the association got a new president, Nina Link, who came to the MPA from the Children's Television Workshop, where she was, among other things, a producer of Sesame Street.

Nine months after the Wisconsin tragedy, Link was interviewed by Folio, a magazine geared toward people in publishing.

The interviewer asked Link, "In television reports about the accident, the MPA refused to comment. Was that the right decision?"

"I don't know," Link is quoted as saying. "People here are so thoughtful, and that decision was made with a lot of consideration."

The interviewer tried again: "Would you refuse to comment?"

Link said, "I'd have to be in the situation. If I felt it wasn't in the best interest of magazines, then no."

A few questions later, the interviewer asked, "Should publishers be more aggressive in self-policing efforts?"

Link's answer: "We have some 'best practices,' and again, we have established guidelines. I think many members have been good about following those guidelines, but there are probably a few that haven't."

The thing is, neither Hadlock's letter to the governor, nor Link's position that publishers take the MPA guidelines seriously, appears to hold up under scrutiny.

At the time of Crystal Mahathy's death — 11 months after the Wisconsin wreck — she was working from a hot-list provided by National Publishers Exchange, one of the country's biggest clearinghouses, which cleared major magazines like Time, Rolling Stone and US News & World Report. Yet NPE did not sever ties with Senner after the wreck. He served six months in jail and was back on the road, still using NPE's hot-lists.

After the families of Crystal Mahathy and Scott Tarwater sued Rick Senner, Russell Wood and All-Star Promotions (the case was settled for an undisclosed amount), Senner split from All-Star and joined a company called Entrepreneurs Across America. (Mahathy's and Tarwater's families also sued Firestone Tires, which in 2000 had recalled a massive number of defective tires, many of which were fitted onto Ford Explorers, one of which Senner was driving. Firestone settled with the families for an undisclosed amount).

Entrepreneurs Across America also used hot-lists from NPE, which featured titles like Reader's Digest, Maxim, Forbes and Elle. And these titles were hawked by top-tier individuals like Jacob Kanupp, who, according to internal documents from EAA, was a top seller when he joined in 2005. At the time, the 23-year-old Kanupp had a warrant out for his arrest and had racked up charges (if not outright convictions) for possession of cocaine, assault with a deadly weapon, carrying a concealed weapon, felony possession of marijuana, contributing to the delinquency of a minor, credit card fraud, driving without a license, DWI, defrauding an innkeeper, drunk and disorderly conduct, and, oh, littering.

Representatives at the National Publishers Exchange ignored calls from the Press for weeks. It wasn't until we left a voice mail saying we had confirmation that NPE had subcontracted with All-Star Promotions and Entrepreneurs Across America that we got a call back. That was from a woman named Elaine Scanlon, who would only say that they do not disclose which road crew companies they work with.

A TV Guide representative was the only person who would admit to a relationship with National Publishers Exchange, and that was only because, according to the representative, TV Guide dropped NPE — and all door-to-door sales — in 2007.

A representative for US News & World Report stated in an e-mail, "...since U.S. News is a privately held company, we do not disclose individual vendor sales information."

Ellen Morgenstern of Reader's Digest also sent an e-mail, stating, "the vast majority of Reader's Digest subscriptions come from direct mail efforts, partnerships, and via the Internet. A very small percentage come from authorized subscription agents that comply with industry guidelines and practices."

Beth Jacobson of Wenner Media, which publishes Rolling Stone, seemed confused when told that the Press was looking into door-to-door sales agents. "Wenner media doesn't directly retain those companies," she said, which is precisely the point.

The Web site for the Pilot Point-based Direct Subscription Services includes Rolling Stone on its list of available titles. But it's much better for Wenner Media never to step into the same room with a top-selling DSS agent like Tim Heinecke, who joined the company after skipping out on probation for beating his three-year-old daughter.

Who wants to be publicly associated with that guy?
_____________________

In her short time on the road for Senner Sales, Crystal Mahathy got to meet all kinds of people.

The thing about a Jones is, you never know what you're going to get. Some male Joneses will buy any crappy magazine from an agent showing enough cleavage. Some will invite you in for a joint. Some will slam the door in your face or sic their dog on you.

Mahathy was so young and unassuming that she seemed to invite sympathy from her Joneses. A woman in Rio Dell, California, invited Mahathy in for some food and a rest. She wound up talking to Mahathy for two hours. She felt so bad about taking up Mahathy's time that she bought a subscription to Rolling Stone.

Before Mahathy went on to the next Jones, the woman made sure to get her address. Mahathy gave her the address to her aunt Shirley's house.

The following Christmas, Shirley Mahathy opened her mailbox and found a card from Rio Dell, addressed to Crystal. Shirley opened the envelope to find a Christmas card — a red background with pictures of little toys scattered about, and a bed with three sleeping tots.

Inscribed in the card was a message from the woman who had sat and talked with Mahathy months earlier.

"Hey little one," it read, "...please send a note and let us know you are safe and home."

Of course, the woman never got a note. By that time, Crystal Mahathy was ten months dead.
http://houstonpress.com/2008-07-17/n...ine-sales/full





Medvedev Says Technology Key to Russian Democracy

Modern communications technology should become a gateway to democracy in Russia, President Dmitry Medvedev said on Thursday, ordering his ministers to improve online public access to the government.

"Free access to information for our citizens is one of the key benchmarks of the democratic process," the Russian leader told a meeting of his advisory State Council in the northwestern city of Petrozavodsk.

"Information technology directly affects the political system, accessibility of political institutions and thus the development of democracy," he added.

Medvedev's predecessor, Vladimir Putin, focused his eight-year presidency on restoring Kremlin control over Russia after a decade of post-Soviet political turmoil.

His supporters say such policies helped sustain Russia's biggest economic boom in a generation. Critics argue that the centralization of power crippled democracy and deprived the economy of flexibility.

Medvedev, who took over in May, has promised to install the "rule of law" and fight corruption, steps analysts say are needed to modernize society and the economy.

Addressing top ministers and regional bosses on Thursday, he said the inability of ordinary people to gain access to the government or receive official information was a big problem.

"(Solving this problem) would naturally contribute to fighting corruption," Medvedev said.

One key aspect of the problem is that computer illiteracy is widespread among Russian citizens and officials, according to Medvedev, who has shown interest in communications technology.

Modern Equipment

In recent years the government has spent billions of dollars equipping schools, offices, hospitals and libraries with modern computer equipment, but this has failed to replace paperwork and bureaucratic procedures, traditional channels for corruption.

Medvedev ordered officials to revive by 2010 the "Electronic Government" plan adopted under Putin, which would computerize the flow of official documents and contracts, increasing the transparency of government activities.

The stalled project also envisages broader electronic access for ordinary people to official services and information.

Medvedev warned officials that inability to acquire 21st century skills could cost them their jobs.

"An official who does not have elementary computer skills cannot work effectively, that means he has to look for another job," Medvedev said. "Learn or leave!"

He also lambasted the government for failing to organize nationwide computer training, a job done by foreign agencies.

"International training centers run by the U.S. Department of State's bureau of educational and cultural programs operate in 30 cities," Medvedev said.

"There is nothing wrong about this, but generally this is not the State Department's job at all," he added. "We are not a banana republic which is allowed to enjoy the fruits of civilization. We have our own resources."

(Writing by Oleg Shchedrov, editing by Tim Pearce)
http://www.nytimes.com/reuters/world...nications.html





Inside Nairobi, the Next Palo Alto?
G. Pascal Zachary

IN the republic of innovation, life is unfair. A relatively small number of places — all in wealthy countries or in China and India — create nearly every important technological advance.

Other places must be content with technologies made by others. Yet people in these areas are dreaming of more.

Consider Wilfred Mworia, a 22-year-old engineering student and freelance code writer in Nairobi, Kenya. In the four weeks leading up to Apple’s much-anticipated release of a new iPhone on July 11, Mr. Mworia created an application for the phone that shows where events in Nairobi are happening and allows people to add details about them.

Mr. Mworia’s desire to develop an application for the iPhone is not unusual: many designers around the world are writing programs for the device. But his location posed some daunting obstacles: the iPhone doesn’t work in Nairobi, and Mr. Mworia doesn’t even own one. He wrote his program on an iPhone simulator.

“Even if I don’t have an iPhone,” Mr. Mworia says defiantly, “I can still have a world market for my work.”

Nairobi’s challenges are many. Internet use is relatively expensive and slow. Power failures are common. The city also lacks a world-class technical university. Mr. Mworia’s professors don’t offer lessons in the latest computer languages; he must learn them on his own.

Political instability can be a problem, too. Earlier this year, Kenya suffered widespread violence after its disputed national election. For weeks, work in Nairobi came to a halt.

“If you have a bright idea in Nairobi, you can’t just turn it around,” says Laura Frederick, an American working on an online payment system in the city.

Still, Nairobi is home to a digital brew that invites optimism about its chances for creating unusual innovations. The city has relatively few wired phone lines or networked personal computers, so mobile phones are the essential digital tool. Four times as many people have them as have bank accounts. Text messages are far more popular than e-mail. Safaricom, the dominant mobile provider, offers a service called M-pesa that lets customers send money with text messages. Nokia sells brand-new phones here for as little as $33.

While engineers in the United States lavish attention on expensive phones that boast laptoplike features, in Kenya there are 10 million low-end phones. Millions more are used elsewhere in Africa. Enhancements to such basic phones can be experimented with cheaply in Nairobi, and because designers are weaned on narrow bandwidth, they are comfortable writing compact programs suited to puny devices.

“Applications are heavy in America,” says Michael Wakahe, a Nairobi code writer. “Here we have to make them light,” because simpler hardware requires smaller programs. These can have advantages in wireless systems.

The distinctive digital experience in Nairobi inspires confidence in its youthful community of programmers, bloggers and Web enthusiasts. Over the past year, about 600 people in Nairobi — most under 25 — have coalesced into a group called Skunk Works, sharing ideas and encouraging new businesses. In June, it held an all-day workshop that included sessions on using the Android phone operating system from Google, developing applications for digital maps and creating content for mobile phones.

“Possibilities are opening up for us,” says Josiah Mugambi, one of the group’s organizers.

The prospect of marrying low-end mobile phones with the Internet is earning Nairobi notice from outsiders, who wonder whether the city might emerge as a test-bed for tomorrow’s technologies. One intriguing possibility is broadcasting local television programs on mobile phones.

In Nairobi’s highest-profile validation, Google opened a development office here last September. “Africa is a huge long-term market for us,” Eric E. Schmidt, Google’s chief executive, said by e-mail. “We have to start by helping people get online, and the creativity of the people will take care of the rest.”

Google hired seven recent university graduates, who digitally mapped the streets and structures of Nairobi for Google Maps. The company is now doing the same for other African cities. A leading Nairobi television broadcaster, NTV, has made a deal to present whole episodes of its programs on YouTube, a Google property.

Google plans to hire more people in Nairobi and is recruiting staff in half a dozen other African cities. In Nairobi, Google chose a veteran of the city’s Internet-access industry to lead its office. The company assigned two Americans here; like the presidential candidate Barack Obama, each is the child of a Kenyan and an American.

The company’s presence has raised ambitions. “When I interview people for jobs in this office,” explains Chris Kiagiri, a Google technology officer in Nairobi, “I ask them, ‘What would you like to see Google do in this market that it has not attempted anywhere else in the world?’”

“A lot of people assume Google is trying to replicate in Africa what it has done elsewhere,” adds Mr. Kiagiri, who transferred last year from Google’s head office in California. “Sure, we want to bring existing products into this market. But we also want to organize information locally in a way we haven’t done elsewhere.”

To be truly creative in a technological backwater is to defeat geography. Even as powerful a technological force as Google might not succeed. But dreaming of greatness, Kenyans are pushing Google to expand into completely new areas.

One local programmer, Timothy Mbugua, wants Google to enhance its communication backbone so he can use it to build a money-transfer business that would charge lower rates than existing services. While it sounds daunting, Mr. Mbugua explains, “I’m only saying to Google, ‘This is what I need from you in order to execute my idea.’”
http://www.nytimes.com/2008/07/20/bu...ss/20ping.html





Venture Funding Drops for Youngest Companies As Older Ones Suck Up More Cash
Abha Bhattarai

In an ominous sign for Silicon Valley’s entrepreneurial machine, venture capital firms are cutting back on their investments in companies at their earliest stage of development and being forced to provide extra funding for later-stage companies that can’t leave the nest and go public.

Overall, venture capital investment remained flat at about $7.4 billion in the second quarter, according to a report released Saturday by the National Venture Capital Association and PricewaterhouseCoopers. But the amount of money invested in companies seeking their first round of venture investment fell 12 percent to $1.6 billion, down from $1.8 billion in the first quarter. Also, first-round financings fell to just 21 percent of all venture funding — the lowest percentage since the fourth quarter 2004.

Mark Heesen, president of the N.V.C.A., suggested that the drop reflected caution by funders who are worried about their inability to cash out of their investments through initial public offerings of stock.

In a conference call with reporters Friday to discuss the findings, Trevor Loy, managing partner at Flywheel Ventures in Santa Fe, said that the closed IPO window is a “measured concern at this point.” But, he added, “the longer it plays out, the more we begin to have strong concerns that it is not only a long-term concern for our industry and the entrepreneurs that we fund but also for the competitiveness of the US economy.”

According to the latest round of numbers, venture capitalists invested $7.4 billion in 990 deals during the second quarter, compared with the $7.5 billion invested in 977 deals last quarter.

The top two deals of the quarter, valued at $132 million and $115 million, were investments in clean technology companies. Rising investment in that sector — which includes companies that deal with wind power, solar power and biofuels — plus an increase in funding for Internet companies helped keep venture investment figures afloat.

Early- and expansion-stage deals took a hit as firms remained hesitant to make long-term investments in the midst of an economic downturn.

But later-stage deals rose 14 percent, with $3.1 billion being invested into 318 deals, as companies faced few opportunities to go public or become acquired.

John S. Taylor, vice president of research at the N.V.C.A., compared the situation to a class of graduating college seniors going home over spring break and telling their parents “the job market isn’t good, graduation is overrated and they’re going to stay around,” he said. “So we have a lot of companies now in this later stage that require financing and in many cases, these financing rounds are large.”
http://bits.blogs.nytimes.com/2008/0...ash/index.html





From the Inside, Jerry Yang Looks Out for Yahoo
Andrew Ross Sorkin

“Do you let the fox in the henhouse?”

So asked Jerry Yang, Yahoo’s co-founder and chief executive, as we chatted for more than an hour one afternoon last week at Allen & Company’s annual conference here.

The fox in question, of course, is Carl Icahn, the activist investor who is trying to oust Mr. Yang and the Yahoo board so he can sell the company to Microsoft. “I don’t mean to impugn anyone’s personal integrity,” Mr. Yang quickly added. Let it never be said that Mr. Yang lacks manners.

Yahoo — and Mr. Yang’s fate — were Topic A at the annual billionaires’ summer camp, as rival moguls gossiped about whether Yahoo would end up in the hands of Microsoft. While Mr. Yang casually smoked a cigar Thursday evening outside of the bar with Richard Parsons, the chairman of Time Warner — who himself battled with Mr. Icahn two years ago — the debate was raging at virtually every table.

“There won’t be a deal. There are bad personal feelings,” proclaimed Rupert Murdoch of the News Corporation, who lost his wedding ring that night and got down on all fours — along with half a dozen other mogul types — to search for it. (They didn’t find it.) Another mogul, a longtime friend of Mr. Yang’s, took the opposite view: “He’s a goner.”

What almost no one here knew was that behind the scenes, Mr. Icahn had been conducting an extraordinary round of secret negotiations with Steve Ballmer, the C.E.O. of Microsoft, the result of which was yet another Microsoft offer for Yahoo. The new bid from Microsoft and Mr. Icahn spilled into public view Saturday night. Yahoo quickly rejected it.

For good reason. The deal was so ridiculous — it called for Yahoo to sell its search business to Microsoft and for Mr. Icahn to take over the board of what was left of the company after assets were spun off and dividends paid out — that when the moguls here started to learn the details, it actually began to change the perception of Mr. Yang’s predicament.

Think about it: “What global company in their right mind formally teams up with Mr. Icahn?” as one invitee asked. Mr. Icahn may be a brilliant investor — he actually doesn’t get enough credit or respect for that — but let’s be honest, he doesn’t use a computer, let alone know how to run Yahoo. And what does it say about Microsoft? The notion that Yahoo’s board would sell the crown jewel, its search business, to Microsoft and then hand over the scraps of the company to Mr. Icahn is, as Roy Bostock, Yahoo’s chairman, said, “absurd and irresponsible.”

(The war of words continued with Mr. Icahn firing back on Monday: “I have yet to see a company distort, omit and twist events and facts in the manner that Yahoo has done.” Separately, Microsoft claimed its proposal “did not include changes to Yahoo’s governance,” though that’s exactly what its partner, Mr. Icahn, was calling for.)

Mr. Yang may once have looked like an entrenched founder unwilling to sell the company, but now it is Microsoft that has those in the deal-making world wondering about its judgment. “At this point, it’s embarrassing,” one technology C.E.O. whispered just out of earshot of Bill Gates. “Ballmer should either buy the company or forget it.”

To the other moguls, it appears as though Microsoft doesn’t have the courage of its convictions — and doesn’t even really seem to know how to proceed.

“If Microsoft called to buy your company, would you call them back?” a media executive asked, incredulously. Eric Schmidt, chief executive of Google, echoed that view. “Microsoft has a long history of having deals that look quite good and end up looking not so good when you look at the fine print,” he said.

Mr. Yang, dressed in a yellow button-down shirt and khakis, paced around a private room overlooking a duck pond as we spoke. He insisted that he had been prepared to sell the company to Microsoft all along, and practically pleaded with Mr. Ballmer to negotiate a serious deal. Microsoft, he believes, has tried to undermine Yahoo’s business so it can buy the company at a fire-sale price. Judging by Microsoft’s recent actions, it is becoming harder to argue with him. “It is now more clear in hindsight what they wanted to do,” Mr. Yang said.

One big problem Mr. Yang has is that some of Yahoo’s biggest shareholders — several of whom showed up in Sun Valley, including Bill Miller of Legg Mason and Gordon Crawford of Capital Research — believe that he should have sold the company to Microsoft when it had a $33-a-share offer on the table. On that score, of course, they may be right to be upset.

But let’s be real: The $33 a share has always been a bit of a misnomer — since the offer was partly in stock, it is worth only $29 and change today.

In less than a month, these shareholders will have a chance to express their displeasure when Yahoo holds its annual meeting — when they will vote on whether to oust the Yahoo board and install Mr. Icahn’s slate. In the days preceding the Sun Valley conference, Mr. Ballmer, for the first time, publicly backed Mr. Icahn, announcing that if the activist investor were able to take control of the board, Microsoft would come back to the negotiating table.

“We have concluded that we cannot reach an agreement with them,” Microsoft said in a statement last week about the current board. “We confirm, however, that after the shareholder election, Microsoft would be interested in discussing with a new board a major transaction with Yahoo.”

Mr. Yang is incredulous about the statement. “To say he can’t work with this board is ludicrous,” he said.

And there is something to what he is saying: at this point, if Microsoft were serious, why wouldn’t it seek to strike a deal while it had the backing of the company’s founders and the good will of a friendly deal? The timing is perfect. Mr. Yang and the Yahoo board are under so much pressure from disgruntled shareholders like Mr. Miller, they would have no choice but to negotiate a deal. And if Microsoft and Mr. Icahn’s combined offer really is worth $33 a share as they say it is — yes, the math is complicated — then Microsoft should just buy the whole thing and do it itself.

As it happens, the moguls here tended to agree with Mr. Yang’s analysis; namely, that Microsoft may just be trying to play the role of spoiler. “Steve is playing Carl to the hilt,” said one rival mogul, drinking a Scotch and smoking a cigar after midnight. “If Carl gets the board, Steve will buy Yahoo for a song — or watch Yahoo die on Carl’s watch.”

Mr. Miller of Legg Mason, who held court in the back of the bar Tuesday night with Sue Decker, Yahoo’s president; Larry Page, Google’s co-founder; and Terry Semel, Yahoo’s former chief executive, hinted that as upset as he is with Yahoo, he wasn’t yet sure he could support Mr. Icahn. He fears that Mr. Icahn wouldn’t extract a fair price from Mr. Ballmer. “He’d have more shareholder support if he would say he wouldn’t sell the company for less than $33.”

Others, however, appear willing to back Mr. Icahn. Mr. Murdoch said he spoke with Mr. Crawford of Capital Research, who is furious with Yahoo’s board.

Mr. Yang recently met with Mr. Icahn in his New York office. “We’ve had rational conversations,” Mr. Yang said of the meeting, almost as if he enjoyed the get-together. “He said to me, ‘I like you, but I have to get rid of you,’ ” he recounted with a smile.

Amazingly enough, he seems almost willing to give up the helm if it would help. “This isn’t about me,” he said, with a sense of earnestness. “It’s about what’s going to happen to Yahoo.”

So how did Mr. Yang act so calmly all Thursday and Friday — mingling effortlessly when he knew Mr. Ballmer and Mr. Icahn were off somewhere plotting his demise?

“Sure, it was on my mind,” he told me later. “But I’ve gotten pretty good at compartmentalizing. If you let this sort of situation take over your life, it will. I have a business to run and stockholders to think about.”
http://www.nytimes.com/2008/07/15/te.../15sorkin.html





Apple Climbs Into Third Place in U.S. PC Market
Mark Hachman

Apple Computer again cracked the top three in U.S. PC sales for the second quarter, according to surveys released Wednesday by both Gartner and IDC.

Worldwide, Apple didn't make the top five PC vendors, according to both firms. But within the U.S., IDC estimated that Apple finished in a virtual dead heat with Acer for third place, just 2,000 units behind the Asian PC maker. Gartner, meanwhile, said that Apple took the third-place spot outright, topping Acer by 65,000 PCs sold.

Both IDC and Gartner retroactively ranked Apple fourth in sales for the second quarter of 2007, if measured against a merged Acer-Gateway business. If treated as separate companies, Apple would have maintained its third-place ranking.

Both sets of data are preliminary, the firms said. The PC sales estimates include desktops, laptops, and X86 servers, but not handheld PCs. Ultraportables and so-called mini-notes were also included, although Gartner estimated that they represented just 3 percent of the market.

Domestically, Dell maintained its top spot, capturing 31.9 percent of the market according to Gartner, with 5.25 million PCs sold; IDC said that Dell's market share was 32.0 percent, with 5.44 million PCs sold. Both firms estimated that Dell grew between 11 and 12 percent from the same quarter a year ago.

HP finished second in U.S. sales, with a 25.3 percent share according to Gartner, and a 25.1 percent share according to IDC; the firm sold 4.17 million and 4.26 million PCs, according to the respective firms. HP's year-over-year growth was sluggish, about 5.6 to 5.9 percent.

Treated as a merged company that included Gateway's results, Acer's sales slipped about 20.8 percent from year to year, finishing at 1.33 million shipments or about an 8.1 percent market share, according to Gartner.

Apple, however, showed tremendous growth: 38.1 percent year over year, Gartner said, or 31.7 percent by IDC's estimates. Apple sold 1.40 million units, according to Gartner, and 1.32 million according to IDC. In total, that gave Apple an 8.5 percent or a 7.8 percent market share, according to the respective firms.

According to Gartner, total U.S. PC shipments increased 4 percent to 16.4 million units. But the firm also said that U.S. consumers are increasingly turning to low-end machines as a way to save money.

"Home mobile PCs continue to have momentum in the U.S. market. However, ASP declines were greater here than in other segments. The retail space was a harsh pricing environment during the quarter," according to Mika Kitagawa, the Gartner analyst in charge of the report.

Worldwide, PC shipments rose 15.3 percent according to IDC, to 70.6 million units. On a global scale, the top five vendors showed excellent growth; fourth-ranked Lenovo grew the least of the group, at 14.6 percent. HP grew 16.8 percent to lead the market with 13.3 million units shipped, and a 18.9 percent market share. Dell was second, growing 21.4 percent to 11.6 million units and a 16.4 percent share. Third-ranked Acer grew 63.5 percent when Gateway's numbers were factored in, finishing with 6.97 million units and a 9.9 percent share. Lenovo sold 5.6 million units and finished with a 7.9 percent market share, while Toshiba grew 28.5 percent to 3.1 million units and a 4.4 percent share.
http://www.pcmag.com/article2/0,2817,2325860,00.asp





EMI Expected To Announce Profit For Q1
FMQB

EMI is reportedly set to announce a 61 percent increase in the company's fiscal first quarter, due to the company's new ownership cutting costs and strong new releases in 2008. According to Reuters, a letter from Terra Firma head Guy Hands says that the label's recorded music division brought in approximately $118 million (or £59.2 million) EBITA. In 2007, the company's first quarter saw a loss of almost $90 million.

"These are early days," Hands wrote. "And it can be misleading to look at just one quarter in isolation due to the timings of releases. As we all know, the recorded music business is extremely volatile and we cannot count on future quarters always being this good. Nevertheless I believe these numbers are a demonstration of EMI Music's significant progress and all your enormous efforts to transform this business."

Coldplay's new hit album, Viva La Vida or Death And All His Friends, only slightly factored into the numbers, as it was released at the end of EMI's Q1.
http://fmqb.com/Article.asp?id=791124





Gannett Quarterly Profit Falls, Plans Writedown

Gannett Co Inc <GCI.N>, the largest U.S. newspaper publisher, posted a 36 percent drop in preliminary quarterly profit on Wednesday because of a worsening decline in print advertising sales, and said it plans to take a writedown that could be as high as $2.9 billion.

Gannett, which publishes USA Today, the largest U.S. newspaper by circulation, said second-quarter net income fell to $232.7 million, or $1.02 a share, from $365.7 million, or $1.56 a share, in the same quarter a year ago.

Revenue fell 10 percent to $1.72 billion.

The non-cash writedown, which is for the impairment of goodwill and other assets, could range from $2.6 billion to $2.9 billion before taxes, and from $2.4 billion to $2.7 billion after taxes, Gannett said.

Gannett is the first of the publicly traded U.S. newspaper companies to report financial results this quarter. The decline in print advertising sales is likely to show up in other publishers such as Media General Inc <MEG.N>, which is expected to report its results on Thursday.

(Reporting by Robert MacMillan; editing by John Wallace)
http://www.reuters.com/article/ousiv...AB090120080716





NAB's Rehr Asks FCC To Consider Satcasters' Past In Merger Decision
FMQB

NAB President/CEO David Rehr has sent a letter to FCC General Council Matthew Berry, again voicing his concerns over the potential satellite radio merger. Rehr urges the Commission to look into the "lack of candor" and "past violations" of XM and Sirius before any approval of the merger.

Rehr writes that "the simple fact that [XM and Sirius are] willing to deceive the Commission raises qualification concerns." He adds that "Under the Communications Act, the Commission must address as part of the merger proceeding the allegations in the record regarding lack of candor. If it determines that the allegations raise substantial and material questions of fact, it is required by law to designate the applications for a hearing. Either way, the candor issue may not legally be deferred to a subsequent enforcement proceeding."

He continued, "Whether XM and Sirius are in violation of the interoperable radio rule is not the key issue. Rather, the Commission must consider the separate question of XM’s and Sirius' willingness to deceive the Commission on an issue that they themselves have made material to the merger proceeding. Moreover, the Commission must resolve this issue before it can act on the pending merger application."

Rehr concludes that the satcasters "cannot be relied on to comply with the letter and the spirit of any voluntary commitments they make or any merger conditions the Commission may impose. The fact that the Commission refuses to place in the record of this proceeding additional information regarding the scope of the companies’ malfeasance that the Enforcement Bureau ordered released a year ago underscores this conclusion. Indeed, based on the record of the merger proceeding, the Commission should fully expect that XM and Sirius will make every effort to avoid the requirements of the conditions whenever it suits their business interests to do so. For the forgoing reasons, the Commission may not legally approve the merger based on the record. It may not legally defer the candor and reliability issues raised in the record to an enforcement proceeding but must address the issues in the merger proceeding."

The complete letter can be read in PDF format here.
http://fmqb.com/Article.asp?id=793046





No Local Election Coverage on TV? No Problem, Says FCC
Matthew Lasar

The owners of 19 Chicago- and Milwaukee-area television stations can sleep soundly thanks to the Federal Communications Commission, which on Friday yet again turned down challenges to their licenses filed by two public interest groups. Chicago Media Action (CMA) and the Milwaukee Public Interest Media Coalition (MPIMC) had appealed the Commission's earlier rejection of their Petition to Deny the license renewals of these stations. But the FCC is sticking to its guns. The agency insists that, despite studies showing that the local election coverage these stations provide stinks, the CMA/MPIMC petition did not prove "bad faith" or that TV programming in Chicago and Milwaukee has "generally been unresponsive" to the public interest.

The FCC's stance demonstrates, once again, that at present it is difficult, if not impossible to apply public interest pressure to TV stations via the Commission's license renewal process.

Down with them all

CMA's Petition to Deny Renewal challenged all of Chicago's full-power TV stations. Its November 2005 brief argued that the licenses "failed to present adequate programming relating to state and local elections during the 2004 election campaign." That put it politely. In fact, the petition included a survey showing that five of these signals' newscasts devoted less than one percent of their stories to non-federal elections in the last four weeks before Election Day in November. That is, for all practical purposes, no reporting at all.

The Center for Media and Public Affairs (CMPA) "2004 Campaign News Study in Chicago, Milwaukee, and Portland Markets" showed that in Chicago most coverage went to the Presidential race and the Senate campaigns, and most of that went to strategic and horse race style coverage. About 15 percent went to candidate sound bites, each on average about 10.2 seconds long. "Even though the [Senate] race was never close," the study observes, "the campaign between the new wunderkind of the Democratic party [Barack Obama] and the theatrical, outspoken Mr. [Alan] Keyes drew heavy coverage."

On the other hand, Chicago area TV viewers interested in Illinois state house races could expect to see two stories max during that four week period at each of four of the five studied stations. The fifth offered no such news at all. One station provided exactly one story about non-state legislature races. The best of them aired ten. A race for State Attorney in one county "received virtually no attention" until the father of one candidate was arrested on corruption charges.

As for the style of the stories, or "frame," as the CMPA study put it, most went to "horse race" stories (guesstimating a candidates' electoral chances at the moment) and "strategic" stories ("how the candidate was using an event to reach particular groups of voters"). Strategy and horse race items dominated coverage. Issues-oriented features counted for less than a fifth of air time.

These patterns were even more extreme in Milwaukee, according to CMPA, where nearly three quarters of election news stories went to the Presidential race. Every other kind of campaign got tiny percentages of next to nothing—except the Senate campaign, which got three percent coverage. Just short of 78 percent of TV election coverage in Portland went to the Presidential contest. 0.6% went to state legislature campaigns. 0.4% went to local, non-state legislature races.
Denying the deniers

Attorneys for CMA and MPIMC acknowledged in their original Petition that in 1984 Ronald Reagan's FCC dropped any requirement that TV and radio stations provide a specific quantity of news and public affairs programming. But they pointed out that the agency's Deregulation Order still emphasized "the basic responsibility to contribute to the overall discussion of issues confronting the community," calling it "a non-delegable duty for which each licensee will be held individually accountable."

Except in Chicago and Milwaukee, apparently. "The petitions have no provided evidence that the named licensees exercised their editorial discretion in bad faith," the agency ruled in 2007. "Quantity is not necessarily an accurate measure of the overall responsiveness of a licensee's programming." The Commission reiterated this stance in its response on Friday to CMA/MPIMC's appeal, which included an updated study indicating that Chicago and Milwaukee TV stations air more political advertising than election coverage during a typical thirty minute newscast.

It should be noted that the FCC could have done something short of denying all these licenses. The agency could have put into the files of some of these stations a comment observing the lack of local election coverage and a statement expecting more come the next license renewal date. But instead the Commission has boosted the status quo. When it comes to the renewal process, an FCC broadcast "license" continues to be that in name only. For all practical purposes it is real estate.
http://arstechnica.com/news.ars/post...-says-fcc.html





What It's Like To Watch FOX News For 24 Straight Hours
Nathan Robinson

Because I am a decent, thinking person, I despise FOX News. I believe I have good reason to do this. And yet, because I'm a bleeding-heart liberal who likes to have the facts before spewing prejudices, I feel duty-bound to give FOX a chance. So I'm going to watch 24 straight hours of FOX.

I know what you are thinking. "He is a madman!" you say. "He'll make his eyes fall out and his ears bleed!" Perhaps. But I have convinced myself that it will be worth it, if only so I can count the number of times Brit Hume's jowls bob up and down over the course of a broadcast.

I have decided to commence my torture at 9p.m. I've been deliberately waiting until after The O'Reilly Factor. I'm not sure that I can take that kind of horror straight off. I need to build up to it, like trying to boil a frog. I'll watch Bill tomorrow. For now, I'll ease into it with some less unpleasant FOX programming.

What I'd forgotten is that Hannity & Colmes is the 9p.m. program.

I think I'm ready for some punishment, though. I settle in, turn up the volume, and eagerly await the Dynamic Duo's adorable interplay.

Tonight's big news is Jesse Jackson saying he'd like to cut Barack Obama's nuts off. I picked an exciting news cycle to tune in to.

Newt Gingrich is tonight's first guest. He accuses Jesse Jackson of resenting Barack Obama's getting the nomination, as if somehow Jesse was in the running. Much gleeful Jackson-bashing is done.

But the interview takes an unexpected turn as it covers other subjects. At one point, Gingrich actually disagrees with Sean Hannity, going so far as to say that Hannity has uttered "the least Reagan-like quote I've ever heard you speak in your career." Everything is measured in units of Reagans. Nevertheless, the interview ends amicably.

The next guest is Juan Williams, who discusses the black "culture of victimization." He says Jackson is just upset with Obama for "not standing with all black Americans being contrarian and opposing everything." The interview ends like this:

HANNITY: Can you name one hard decision that Barack Obama has made and stuck to?
WILLIAMS: Wow. You know, for me, I think it's not a matter of that for him right now. I can't name it for you, so I guess I give up.

COLMES: (meekly) I have an answer.

Colmes is ignored. Williams suggests that "ending tax cuts" might be one issue where Obama is consistent. The segment ends.

So far, it's just as painful as I expected. Alan Colmes is predictably pathetic, and Sean Hannity is every football jock I ever hated in high school. I wonder what Hannity and Colmes are like together off the set. I don't think Hannity returns Colmes' phone calls.

With that, Hannity and Colmes is over, and I can breathe easy knowing that I only have 23 hours of FOX left.

Greta Van Susteren is up next. The theme of tonight's show is...Jesse Jackson!

Jackson comes on the show to explain the context behind "I want to cut Barack Obama's nuts off." After some questions on the topic, Greta asks the bizarrely SAT-like question "Do you admire Senator John McCain? And if so, why?"

After the interview, Susteren gives the result of her evening poll:

Will Jesse Jackson's comments change your vote either way?

54% YES
46% NO

I have no idea what the results of this poll mean. I don't think they actually mean anything.

The rest of the broadcast consists of Gene Simmons talking about his new book on prostitution, a discussion of the JonBenet Ramsey case (which occurred in 1996, I might add), and a whole bunch of sleazy gossip about somebody named Christie Brinkley (I don't know who this is. Should I?)

It really does seem as if the "trashy" bias of the network far outweighs the "conservative" bias.

Political news represents a minority of FOX's coverage , and it actually seems like a smaller percentage here than on CNN and MSNBC, who love to deluge us with "Race To The White House" pieces. So most of the news doesn't get explicitly political treatment. It's just, well, sleazy. For example, FOX runs a story about how the economic downturn has hit unexpected sectors...in this case, strip clubs. So they show background graphics of pole dancers doing their thing, and bring a stripper on to interview about her financial situation. It's sort of like having Jerry Springer host CNBC.

Greta Van Susteren ends, and passes it over to...Bill O'Reilly! What?! I had forgotten that The O'Reilly Factor repeats at 11. I can't watch this. Not yet. I switch over to MSNBC, in the faint hope that maybe Rachel Maddow will be on. She always restores my faith in people.

No such luck. It's To Catch A Predator, a more sensationalistic and exploitative show than anything even FOX has on. It looks like I'll be stuck with O'Reilly.

I had thought that eventually I would be numbed to the sensory assault of the channel. But you don't get used to it. It just drives you nuts. It's like your television is trying to attack you. You can turn on most other channels and just zone out, letting the gentle buzz of the TV wash over you.

But not with FOX. FOX screams at you, and won't let you turn your mind down a notch. Everything is angry, bright, and in-your-face.

O'Reilly is expectedly pompous and bullying. To Dr. Michael Eric Dyson, he says condescending things like "as an academic, you can appreciate me correcting you." When Geraldo Rivera objects to O'Reilly's categorization of La Raza as a radical organization, O'Reilly tells him "Nobody cares whether you object, not even your wife and children." He also uses the words "load of crap," "stupid," and "scum" a lot. "Far-left" is his favorite insult. Who let Archie Bunker have a news show?

He also makes sure we know that he is a maverick, free-thinking independent, and not a conservative. "I'm tired of The Washington Post putting the word 'conservative' in front of my name," he complains.

After O'Reilly's show, we have a repeat of Hannity & Colmes, followed by Greta Van Susteren again! It's amazing how much recycling there seems to be. Bill O'Reilly's show is repeated for a third time in the early morning hours.

Somewhere in the night, I fall asleep. Since the TV is on, it infiltrates my subconscious, and I have FOXy nightmares for a number of hours. By the time I awake, it is morning. As I slowly rouse myself, the first words I hear are of a Blonde FOX Lady saying this:

"It's hard to talk about climate change without talking about compact fluorescent lightbulbs, soon to be forced on you by the government. But could they KILL you?"

It was not shaping up to be a good day.

The morning chatterbox people were predictably empty-headed. "A 2nd African American could soon be running for President," referring to Cynthia McKinney's Green Party candidacy. To accompany the story, FOX put up the most deranged-looking photo of Rep. McKinney it could find, prompting the always-classy Bill Hemmer to remark "What is THAT?"

Nothing much in the rest of the day was that interesting. Wildfires, a missing pregnant marine, and Jesse Jackson were the big stories. There is an interview with a couple who is selling the naming rights to their unborn child for gas money. A further investigation into why lightbulbs will kill us all. I glance at the news ticker for the first and only time. It says "Number killed in the 9/11 attacks is now 2,975." Yes, apparently September 11th is still happening.

I start to count the number of different Blonde FOX Ladies. I soon find this to be an impossible task. They cannot be distinguished. Then there's more news about wildfires, a repeat of the lightbulbs-will-kill-you report, and a story on a suspicious package found at a mall.

After about six continuous hours of this, I can no longer deal with it. I break my pledge, I go out for a sandwich. The sense of relief is tremendous. It feels good to breathe the air once more, to be back in reality. The worst thing about FOX is not its bias, but the "panic mode" that it seems to live in. Everything is a catastrophe. Immigrants will get you. Lightbulbs will get you. Wildfires will get you. Jesse Jackson will cut your nuts off.

Greta Van Susteren introduced one of her news stories this way: "It's real, it's terrifying. All the horrible details coming up next." And I think that captures the FOX philosophy fairly well. The message of the network seems to be "It's a scary world out there. You're going to need a gun and some deep-seated prejudice if you're going to make it out alive."

Of course, all networks do this. FOX may be the worst offender, but it's certainly not alone. MSNBC has taken to airing the aforementioned sex-offender show, as well as a whole slew of "inside prison" documentaries, which show just how scary life can be among Terrifying Criminals.
My journey comes to an end at 9p.m., after another riveting episode of The O'Reilly Factor (tonight's theme: Jesse Jackson!). As I flip off the television and return to my life, I realize how grateful I am not to live in the FOX mindset. It's a world where love is replaced by fear, and flashing colors and loud noises stand in for open, honest discussions. It's a crazy-mixed up land of deceit, terror, and sleaze.

John Oliver once watched FOX for eight hours, and said afterward that "I may have lost something deep down in my soul." I did 22 (if you discount my sandwich break), and while I think I escaped with my soul intact, I'm not sure I'll ever be quite the same. But at least I've still got my nuts intact.
http://news.yahoo.com/s/huffpost/200...uffpost/112350





Want Obama in a Punch Line? First, Find a Joke
Bill Carter

What’s so funny about Barack Obama? Apparently not very much, at least not yet.

On Monday, The New Yorker magazine tried dipping its toe into broad satire involving Senator Obama with a cover image depicting the presumptive Democratic presidential nominee and his wife, Michelle, as fist-bumping, flag-burning, bin Laden-loving terrorists in the Oval Office. The response from both Democrats and Republicans was explosive.

Comedy has been no easier for the phalanx of late-night television hosts who depend on skewering political leaders for a healthy quotient of their nightly monologues. Jay Leno, David Letterman, Conan O’Brien and others have delivered a nightly stream of jokes about the Republican running for president — each one a variant on the same theme: John McCain is old.

But there has been little humor about Mr. Obama: about his age, his speaking ability, his intelligence, his family, his physique. And within a late-night landscape dominated by white hosts, white writers, and overwhelmingly white audiences, there has been almost none about his race.

“We’re doing jokes about people in his orbit, not really about him,” said Mike Sweeney, the head writer for Mr. O’Brien on “Late Night.” The jokes will come, representatives of the late-night shows said, when Mr. Obama does or says something that defines him — in comedy terms.

“We’re carrion birds,” said Jon Stewart, host of “The Daily Show” on the Comedy Central channel. “We’re sitting up there saying ‘Does he seem weak? Is he dehydrated yet? Let’s attack.’ ”

But so far, no true punch lines have landed.

Why? The reason cited by most of those involved in the shows is that a fundamental factor is so far missing in Mr. Obama: There is no comedic “take” on him, nothing easy to turn to for an easy laugh, like allegations of Bill Clinton’s womanizing, or President Bush’s goofy bumbling or Al Gore’s robotic persona.

“The thing is, he’s not buffoonish in any way,” said Mike Barry, who started writing political jokes for Johnny Carson’s monologues in the waning days of the Johnson administration and has lambasted every presidential candidate since, most recently for Mr. Letterman. “He’s not a comical figure,” Mr. Barry said.

Jokes have been made about what Senator Hillary Rodham Clinton really thought about Mr. Obama during the primaries, and about the vulgar comments the Rev. Jesse Jackson made about him last week. But anything approaching a joke about Mr. Obama himself has fallen flat.

When Mr. Stewart on “The Daily Show” recently tried to joke about Mr. Obama changing his position on campaign financing, for instance, he met with such obvious resistance from the audience, he said, “You know, you’re allowed to laugh at him.” Mr. Stewart said in a telephone interview on Monday, “People have a tendency to react as far as their ideology allows them.”

Despite audience resistance, Mr. Stewart contended, his show had been able to develop a distinctive angle on Mr. Obama.

Noting that the senator seems to emphasize the historic nature of his quest, Mr. Stewart said, “So far, our take is that he’s positioning himself to be on a coin.”

There is no doubt, several representatives of the late-night shows said, that so far their audiences (and at least some of the shows’ writers) seem to be favorably disposed toward Mr. Obama, to a degree that perhaps leaves them more resistant to jokes about him than those about most previous candidates.

“A lot of people are excited about his candidacy,” Mr. Sweeney said. “It’s almost like: ‘Hey, don’t go after this guy. He’s a fresh face; cut him some slack.’ ”

Justin Stangel, who is a head writer for “Late Show With David Letterman,” disputed that, saying, “We always have to make jokes about everybody. We’re not trying to lay off the new guy.”

But Mr. Barry said, “I think some of us were maybe too quick to caricature Al Gore and John Kerry and there’s maybe some reluctance to do the same thing to him.”

Of course, the question of race is also mentioned as one reason Mr. Obama has proved to be so elusive a target for satire.

“Anything that has even a whiff of being racist, no one is going to laugh,” said Rob Burnett, an executive producer for Mr. Letterman. “The audience is not going to allow anyone to do that.”

The New Yorker faced a different kind of hostility with its cover this week, which the Obama campaign criticized harshly. A campaign spokesman, Bill Burton, said in a statement that “most readers will see it as tasteless and offensive — and we agree.”

Asked about the cover at a news conference Monday, Mr. McCain said he thought it was “totally inappropriate, and frankly I understand if Senator Obama and his supporters would find it offensive.”

The cover was drawn by Barry Blitt, who also contributes illustrations to The New York Times’s Op-Ed page. David Remnick, the editor of The New Yorker, said in an e-mail message, “The cover takes a lot of distortions, lies, and misconceptions about the Obamas and puts a mirror up to them to show them for what they are.

“It’s a lot like the spirit of what Stephen Colbert does — by exaggerating and mocking something, he shows its absurdity, and that is what satire is all about,” Mr. Remnick continued.

Mr. Colbert said in a telephone interview that a running joke on his show has been that Mr. Obama is a “secret Muslim”; the New Yorker cover, he said, was consistent with that. “It’s a completely valid satirical point to make — and it’s perfectly valid for Obama not to like it,” he said.

Mr. Colbert said he had been freer to poke fun at Mr. Obama than other late-night hosts because “my character on the show doesn’t like him. I’m expected to be hostile to him.”

Mr. Stewart, who is also an executive producer of “The Colbert Report,” said the Obama campaign’s reaction to the New Yorker cover seemed part of what is now almost a pro forma cycle in political campaigns. “Nothing can occur without the candidate responding,” he said.

Bill Maher, who is host of a politically oriented late-night show on HBO, said, “If you can’t do irony on the cover of The New Yorker, where can you do it?”

One issue that clearly has some impact on writing jokes about Mr. Obama is a consistency among the big late-night shows. Not only are all the hosts white, the vast majority of their audiences are white. “I think white audiences get a little self-conscious if race comes up,” Mr. Sweeney of Mr. O’Brien’s show said.

Things might be somewhat different if even one late-night host was black. Black comics are not having any trouble joking about Mr. Obama, said David Alan Grier, a comedian who, starting in October, will have a satirical news magazine show on Comedy Central, “Chocolate News.”

“I tell jokes on stage about him,” Mr. Grier said, reciting a few that would not ever get onto a network late-night show (nor into this newspaper).

But he said of the late-night hosts, “Those guys really can’t go there. It’s just like the gay comic can do gay material. It comes with the territory.” Still, he said, he has no sympathy for the hosts. “No way. They’ve had 200 years of presidential jokes. It’s our time.”

Jimmy Kimmel, the host of the ABC late-night talk show “Jimmy Kimmel Live,” said of Mr. Obama, “There’s a weird reverse racism going on. You can’t joke about him because he’s half-white. It’s silly. I think it’s more a problem because he’s so polished, he doesn’t seem to have any flaws.”

Mr. Maher said that being sensitive to Mr. Obama was in no way interfering with his commentary, though on HBO he has more freedom about content than other comedians. “There’s been this question about whether he’s black enough,” Mr. Maher said. “I have this joke: What does he have to do? Dunk? He bowled a 37 — to me, that’s black enough.”

Mr. Kimmel said, “His ears should be the focus of the jokes.”

Mostly the late-night shows seem to be in a similar position.

Mr. Burnett of the Letterman show said, “We can’t manufacture a perception. If the perception isn’t true, no one will laugh at it.”

Mr. Sweeney said, “We’re hoping he picks an idiot as vice president.”

Richard Pérez-Peña and Jeff Zeleny contributed reporting.[/i]
http://www.nytimes.com/2008/07/15/us...5humor.html?hp





Strip Search of 13-Year-Old for Ibuprofen Ruled Unconstitutional

If you have a problem with school officials strip searching 13-year-olds for Advil – or if you care about the government’s standards for informant use and invasive searches – you can take relief in yesterday’s ruling by a full panel of the U.S. Court of Appeals for the 9th Circuit, which ruled 6-5 that students cannot be strip-searched based on the uncorroborated word of another student who is facing disciplinary punishment.

“A reasonable school official, seeking to protect the students in his charge, does not subject a thirteen-year-old girl to a traumatic search to ‘protect’ her from the danger of Advil,” the federal appellate court wrote in today’s opinion. “We reject Safford’s effort to lump together these run-of-the-mill anti-inflammatory pills with the evocative term ‘prescription drugs,’ in a knowing effort to shield an imprudent strip search of a young girl behind a larger war against drugs.”

“It does not take a constitutional scholar to conclude that a nude search of a 13-year-old girl is an invasion of constitutional rights. More than that: it is a violation of any known principle of human dignity,” the court continued.

In addition to finding the strip search unconstitutional, the court held that the school official who ordered the strip search, Vice Principal Kerry Wilson, is financially liable in the case and cannot claim qualified immunity. The ACLU co-represented the student, Savana Redding, before the U.S. Court of Appeals for the 9th Circuit, which decided to reconsider the case after a three-judge panel ruled 2-1 that the strip-search was legal.

For a case like this, it’s hard to understand how the unconstitutionality of strip searching Redding could even be up for debate. Consider how flimsy the government’s case was:

• No physical evidence suggested that Redding – an honor roll student with no history of substance use or abuse – might be in possession of ibuprofen pills or that she was concealing them in her undergarments.
• The strip search was undertaken based solely on the uncorroborated claims of a classmate facing punishment, who was caught with prescription strength ibuprofen – the equivalent of two over-the-counter pills of Advil. (And why on earth might a teenaged girl have ibuprofen?)
• No attempt was made to corroborate the classmate’s accusations among other students or teachers.
• The classmate had not claimed that Redding currently possessed any pills, nor had the classmate given any indication as to where they might be concealed.
• No attempt was made to contact Redding’s parents prior to conducting the strip search.

If you want to get some background information on the abundance of scientific literature describing the serious psychological repercussions of being strip-searched at age 13, you should check out the briefs of support that were also filed by the National Association of Social Workers and the Rutherford Institute.

“The strip search was the most humiliating experience I have ever had,” said Redding in a sworn affidavit following the incident. “I held my head down so that they could not see that I was about to cry.”

As Reason’s Jacob Sullum insightfully observed in his article on the case, “The School Crotch Inspector”:

“There are two kinds of people in the world: the kind who think it’s perfectly reasonable to strip-search a 13-year-old girl suspected of bringing ibuprofen to school, and the kind who think those people should be kept as far away from children as possible … Sometimes it’s hard to tell the difference between drug warriors and child molesters.”

The same safeguards and regulations on informant use that we have been advocating in the context of criminal drug proceedings apply even more so to the context of school, where young people are particularly vulnerable to unsubstantiated rumors and finger-pointing by vindictive peers.
http://blog.aclu.org/2008/07/12/stri...onstitutional/





Spying Uncovered

Documents show state police monitored peace and anti-death penalty groups
Nick Madigan

Undercover Maryland State Police officers repeatedly spied on peace activists and anti-death penalty groups in recent years and entered the names of some in a law-enforcement database of people thought to be terrorists or drug traffickers, newly released documents show.

The files, made public yesterday by the American Civil Liberties Union of Maryland, depict a pattern of infiltration of the activists' organizations in 2005 and 2006. The activists contend that the authorities were trying to determine whether they posed a security threat to the United States. But none of the 43 pages of summaries and computer logs - some with agents' names and whole paragraphs blacked out - mention criminal or even potentially criminal acts, the legal standard for initiating such surveillance.

State police officials said they did not curtail the protesters' freedoms.

The spying, detailed in logs of at least 288 hours of surveillance over a 14-month period, recalls similar infiltration by FBI agents of civil rights and anti-war groups decades ago, particularly under the administration of President Richard M. Nixon.

David Rocah, a staff attorney for the ACLU in Baltimore, said at a news conference yesterday that he found it "stupefying" that more than 30 years later, the government is still targeting people who do nothing more than express dissent.

"Everything noted in these logs is a lawful, First Amendment activity," Rocah said. "For undercover police officers to spend hundreds of hours entering information about lawful political protest activities into a criminal database is an unconscionable waste of taxpayer dollars and does nothing to make us safer from actual terrorists or drug dealers."

The ACLU obtained the documents from the state attorney general's office through a Maryland Public Information Act lawsuit.

Col. Terrence B. Sheridan, superintendent of the Maryland State Police, said in a statement yesterday that the department "does not inappropriately curtail the expression or demonstration of the civil liberties of protesters or organizations acting lawfully."

"No illegal actions by state police have ever been taken against any citizens or groups who have exercised their right to free speech and assembly in a lawful manner," Sheridan said. "Only when information regarding criminal activity is alleged will police continue to investigate leads to ensure the public safety."

Nothing in the documents indicates criminal activity or intent on the part of the protesters, ACLU officials said.

Nonetheless, the state police's Homeland Security and Intelligence Division sent covert agents to infiltrate the Baltimore Pledge of Resistance, a peace group; the Baltimore Coalition Against the Death Penalty; and the Committee to Save Vernon Evans, a death row inmate.

Using a fake e-mail address and an alias, an undercover agent joined the e-mail list of the death penalty group, the documents say. Agents also monitored the group's organizational meetings, public forums and events in churches, as well as rallies on Lawyers Mall in Annapolis and in Baltimore outside the Maryland Correctional Adjustment Center, known as "SuperMax."

Most of the spies' reports were innocuous. After an Aug. 24, 2005, gathering of the Evans group, an undercover officer wrote in a log: "The meeting concluded with members talking about trying to get the man running for Baltimore County State's Attorney to commit to his plans regarding the death penalty in the county."

Baltimore County was responsible for more capital punishment cases than any other Maryland jurisdiction at the time.

Another entry about the Evans group revealed that agents had spent 50 hours of "investigative time" shadowing its members in March, April and May 2005. The entry mentioned that a May 25, 2005, meeting of the group was attended by Max Obuszewski, a former Peace Corps member and longtime activist who moved to Baltimore in 1983, and Terry Fitzgerald, who heads the anti-death penalty coalition and established the Evans group.

Both attended yesterday's news conference.

State police appeared to have been specifically tracking Obuszewski's activities. His name, the documents show, was entered into the Washington/Baltimore High Intensity Drug Trafficking Area database, even though there was "not a scintilla of evidence" that he deserved to be listed, said Rocah, the ACLU attorney.

"Mr. Obuszewski has devoted his entire life to peace," Rocah said. "If there is anyone in the world who is further from a terrorist, it is hard for me to imagine."

Obuszewski agreed. "You cannot get more insulting than to call me a terrorist," he said. Besides, he went on, the groups he belongs to hold open meetings and publicize their schedules. "Why would someone come to those meetings and pretend to be someone else? Why are government agencies targeting pacifists?"

One reason, he theorized, is that local police agencies need funds from the federal government, and surveillance of supposed "terrorists" might be a good way to keep getting the money. No matter the reason, the news that the Bush administration keeps about 1 million names on a terrorist watch-list is disheartening, Obuszewski said, since so many people cannot possibly warrant inclusion.

In February 2006, the national ACLU and its affiliates filed multiple federal Freedom of Information requests seeking records of Pentagon surveillance of anti-war groups around the country. Using information from a secret Pentagon database, NBC News reported that a unit of the Department of Defense had been accumulating intelligence about domestic organizations and their protest activities as part of a mission to track "potential terrorist threats."

"It serves no security purpose to infiltrate peaceful groups," said Michael German, a former FBI agent who specialized in counter-terrorism and who joined the ACLU two years ago as policy counsel in its Washington legislative office. "It completely misuses law enforcement resources."

Since the Sept. 11, 2001, attacks, German said, the government has "actively encouraged" local police agencies to become intelligence gatherers and to compile information that does not necessarily have a connection to criminal activity.

Despite the fact that the Maryland infiltrators' reports consistently said the activists acted lawfully, agents continued to recommend that the spying continue. Reports of the surveillance were sent to at least seven federal, state and local law enforcement agencies, including the National Security Agency, the police departments of Baltimore, Baltimore County, Annapolis and Anne Arundel County, and the state General Services police.

The documents released yesterday show the kind of information they were trading. Among other things, Obuszewski and fellow activists arranged a meeting with then-Rep. Benjamin L. Cardin in 2005 in which they asked him to support a timetable for withdrawal from Iraq.

Susan Goering, executive director of the ACLU of Maryland, said she feared that the documents released so far "may be only the tip of the proverbial iceberg."

In a letter sent yesterday to Gov. Martin O'Malley, Goering wrote that the state police had "recorded extensive information about specific individuals and groups, including describing their political outlook, whether they were articulate, what political activities they are engaged in, and attended private planning meetings in a covert capacity."

The only potentially unlawful activity mentioned anywhere in the documents, she said, were two instances of nonviolent civil disobedience. In one, activists refused to leave a guard station during a protest at the National Security Agency after bringing cookies and drinks for the guards, and in the other, they hatched a plan to place photographs of soldiers who died in Iraq on the fence surrounding the White House.

"Maryland residents should feel free to join a peaceful protest without fear that their names will wind up in police files," Goering wrote. "They should feel free to engage in nonviolent dissent without fear of being branded as 'terrorists' or 'security threat groups' in shared law-enforcement databases."
http://www.baltimoresun.com/news/loc...,3787307.story





Law School Dean Calls Conference to Plan Bush War Crimes Prosecution
Debra Cassens Weiss

The dean of Massachusetts School of Law at Andover is planning a September conference to map out war crimes prosecutions, and the targets are President Bush and other administration officials.

The dean, Lawrence Velvel, says in a statement that “plans will be laid and necessary organizational structures set up, to pursue the guilty as long as necessary and, if need be, to the ends of the Earth."

Other possible defendants, he said, include federal judges and John Yoo, the former Justice Department official who wrote one of the so-called torture memos.

“We must insist on appropriate punishments,” he continued, “including, if guilt is found, the hangings visited upon top German and Japanese war criminals in the 1940s."

Velvel elaborates in an introduction to a series of articles published in The Long Term View. He writes “there is no question” that Bush and other officials are guilty of the federal crime of conspiracy to commit torture.

He also criticizes Justice Department officials for their legal memos. “The DOJ lawyers who wrote the corrupt legal memos giving attempted cover to Bush's actions have been rewarded by federal judgeships, cabinet positions, and high falutin' professorships,” he writes. Yoo is a professor at the University of California-Berkeley law school, while another former Justice Department official who signed a Yoo memo, Jay Bybee, is a judge on the San Francisco-based 9th U.S. Circuit Court of Appeals.

Velvel tears into President Bush as well, writing: “The man ultimately responsible for the torture had a unique preparation and persona for the presidency: he is a former drunk, was a serial failure in business who had to repeatedly be bailed out by daddy's friends and wanna-be-friends, was unable to speak articulately despite the finest education(s) that money and influence can buy, has a dislike of reading, so that 100-page memos have to be boiled down to one page for him, is heedless of facts and evidence, and appears not even to know the meaning of truth.”

A Wall Street Journal editorial published today stands in stark contrast to Velvel’s criticism. It assails House Judiciary Committee Chairman John Conyers for issuing subpoenas seeking information about the possible torture of Sept. 11 suspects. The editorial mentions the testimony of British professor Philippe Sands, who also contends U.S. officials are guilty of war crimes.

“Nearly seven years after 9/11, the U.S. homeland hasn't been struck again and American civil liberties remain intact,” the newspaper writes. “So how does Congress say ‘thank you’? By trying to ruin the men who in good faith set the legal rules that have kept us safe.”
http://abajournal.com/news/law_schoo...pro secution/





CBS Chiefs to Testify in Rather Suit
Jacques Steinberg

The chief executive of CBS and the former president of CBS News have agreed to answer questions from lawyers for Dan Rather, who has accused the network of violating his contract by giving him little to do after forcing him off the “CBS Evening News” in 2005.

Lawyers in the case told a New York State Supreme Court judge, Ira Gammerman, late Wednesday, that Andrew Heyward, the former president of CBS News, will give a deposition in late July, and Leslie Moonves, the chief of CBS, would do so in September. Mr. Rather is also seeking to depose Sumner Redstone, the executive chairman of CBS.

Among other claims Mr. Rather is seeking to prove is that CBS mishandled his removal from the anchor chair he had held for nearly a quarter century in the fallout over a September 2004 report for the weeknight edition of “60 Minutes.” The report, for which Mr. Rather had served as a correspondent, sought to raise new questions about whether President Bush had received preferential treatment during his Vietnam-era service in the National Guard. After bloggers in particular raised questions about the veracity of the documents that had been used to support the report, CBS said it could not verify their authenticity.

In April, Judge Gammerman said that he would permit Mr. Rather to argue throughout the discovery process that CBS had violated his contract by effectively marginalizing him for more than a year after he left the evening news.

For much of that time, Mr. Rather was a correspondent on “60 Minutes,” though he has contended that others were featured far more prominently. In amending his original suit in May, Mr. Rather said that CBS had damaged his reputation to the point that he was unable to get a job with ABC, NBC or CNN. He currently works for HD Net, a high-definition television channel.

Among the claims in Mr. Rather’s original lawsuit, filed in September, is that the network committed fraud by commissioning a “biased” and incomplete investigation of the National Guard broadcast in order to “pacify the White House.”

Mr. Rather has already been deposed, as has Carol Melton, who did legislative work for CBS and its former parent, Viacom, in Washington, and Erik T. Rigler, a private investigator hired by CBS to help vet the documents and other matters at issue in the disputed report.

If CBS’s motions to dismiss are rejected, a trial could begin before the end of the year. In April, Judge Gammerman dismissed Mr. Rather’s individual claims against Mr. Moonves, Mr. Heyward and Mr. Redstone.

In a telephone interview Thursday, Jim Quinn, a lawyer for CBS, said, “We feel comfortable, and we felt comfortable all along, that whether there’s a trial or motion, CBS will be vindicated. We didn’t do anything wrong.”

Edward Reich, a lawyer for Mr. Rather, said in a statement sent via e-mail message, “Yesterday went very well for Mr. Rather. The court is allowing discovery to go forward without limitation.”
http://www.nytimes.com/2008/07/18/ar...18rath.html?hp





CNN Reporter Criticizes TSA, Finds Self on Terror Watch List
David Edwards and Nick Juliano

The post-9/11 airline watch list that is supposed to keep terrorists off of airplanes has swelled to more than 1 million names, including at least one investigative reporter who had been critical of the Transportation Security Agency, which maintains the watch list.

CNN's Drew Griffin reported on the bloating of the watch list, which an ACLU count pegged at 1,001,308 names Wednesday afternoon. Griffin's is one of those names, he says.

"Coincidentally, this all began in May, shortly after I began a series of investigative reports critical of the TSA. Eleven flights now since May 19. On different airlines, my name pops up forcing me to go to the counter, show my identification, sometimes the agent has to make a call before I get my ticket," Griffin reported. "What does the TSA say? Nothing, at least nothing on camera. Over the phone a public affairs worker told me again I'm not on the watch list, and don't even think that someone in the TSA or anyone else is trying to get even."

The TSA, which is a part of the Department of Homeland Security, said Griffin's name wasn't even on the watch list, and the agency blamed the airlines for the delays the reporter experienced. The airlines, on the other hand, said they were simply following a list provided by TSA.

While it wouldn't be much of a stretch for plenty of people to believe the TSA would exercise its revenge via watch-list meddling, an agency spokesman insists that just isn't the case.

"So if there's any thought or shadow of a thought that TSA somehow put you on a watch list because of your reporting," spokesman Christopher White said, "it is absolutely fabricated."
http://rawstory.com/news/2008/CNN_re...atch_0716.html





NSA's Domestic Spying Grows

As agency sweeps up data terror fight blurs line over domain; tracking email
Siobhan Gorman

Five years ago, Congress killed an experimental Pentagon antiterrorism program meant to vacuum up electronic data about people in the U.S. to search for suspicious patterns. Opponents called it too broad an intrusion on Americans' privacy, even after the Sept. 11 terrorist attacks.

But the data-sifting effort didn't disappear. The National Security Agency, once confined to foreign surveillance, has been building essentially the same system.

The central role the NSA has come to occupy in domestic intelligence gathering has never been publicly disclosed. But an inquiry reveals that its efforts have evolved to reach more broadly into data about people's communications, travel and finances in the U.S. than the domestic surveillance programs brought to light since the 2001 terrorist attacks.

Congress now is hotly debating domestic spying powers under the main law governing U.S. surveillance aimed at foreign threats. An expansion of those powers expired last month and awaits renewal, which could be voted on in the House of Representatives this week. The biggest point of contention over the law, the Foreign Intelligence Surveillance Act, is whether telecommunications and other companies should be made immune from liability for assisting government surveillance.

Largely missing from the public discussion is the role of the highly secretive NSA in analyzing that data, collected through little-known arrangements that can blur the lines between domestic and foreign intelligence gathering. Supporters say the NSA is serving as a key bulwark against foreign terrorists and that it would be reckless to constrain the agency's mission. The NSA says it is scrupulously following all applicable laws and that it keeps Congress fully informed of its activities.

According to current and former intelligence officials, the spy agency now monitors huge volumes of records of domestic emails and Internet searches as well as bank transfers, credit-card transactions, travel and telephone records. The NSA receives this so-called "transactional" data from other agencies or private companies, and its sophisticated software programs analyze the various transactions for suspicious patterns. Then they spit out leads to be explored by counterterrorism programs across the U.S. government, such as the NSA's own Terrorist Surveillance Program, formed to intercept phone calls and emails between the U.S. and overseas without a judge's approval when a link to al Qaeda is suspected.

The NSA's enterprise involves a cluster of powerful intelligence-gathering programs, all of which sparked civil-liberties complaints when they came to light. They include a Federal Bureau of Investigation program to track telecommunications data once known as Carnivore, now called the Digital Collection System, and a U.S. arrangement with the world's main international banking clearinghouse to track money movements.

The effort also ties into data from an ad-hoc collection of so-called "black programs" whose existence is undisclosed, the current and former officials say. Many of the programs in various agencies began years before the 9/11 attacks but have since been given greater reach. Among them, current and former intelligence officials say, is a longstanding Treasury Department program to collect individual financial data including wire transfers and credit-card transactions.

It isn't clear how many of the different kinds of data are combined and analyzed together in one database by the NSA. An intelligence official said the agency's work links to about a dozen antiterror programs in all.

A number of NSA employees have expressed concerns that the agency may be overstepping its authority by veering into domestic surveillance. And the constitutional question of whether the government can examine such a large array of information without violating an individual's reasonable expectation of privacy "has never really been resolved," said Suzanne Spaulding, a national-security lawyer who has worked for both parties on Capitol Hill.

NSA officials say the agency's own investigations remain focused only on foreign threats, but it's increasingly difficult to distinguish between domestic and international communications in a digital era, so they need to sweep up more information.

The Fourth Amendment

In response to the Sept. 11 attacks, then NSA-chief Gen. Michael Hayden has said he used his authority to expand the NSA's capabilities under a 1981 executive order governing the agency. Another presidential order issued shortly after the attacks, the text of which is classified, opened the door for the NSA to incorporate more domestic data in its searches, one senior intelligence official said.

The NSA "strictly follows laws and regulations designed to preserve every American's privacy rights under the Fourth Amendment to the U.S. Constitution," agency spokeswoman Judith Emmel said in a statement, referring to the protection against unreasonable searches and seizures. The Office of the Director of National Intelligence, which oversees the NSA in conjunction with the Pentagon, added in a statement that intelligence agencies operate "within an extensive legal and policy framework" and inform Congress of their activities "as required by the law." It pointed out that the 9/11 Commission recommended in 2004 that intelligence agencies analyze "all relevant sources of information" and share their databases.

Two former officials familiar with the data-sifting efforts said they work by starting with some sort of lead, like a phone number or Internet address. In partnership with the FBI, the systems then can track all domestic and foreign transactions of people associated with that item -- and then the people who associated with them, and so on, casting a gradually wider net. An intelligence official described more of a rapid-response effect: If a person suspected of terrorist connections is believed to be in a U.S. city -- for instance, Detroit, a community with a high concentration of Muslim Americans -- the government's spy systems may be directed to collect and analyze all electronic communications into and out of the city.

The haul can include records of phone calls, email headers and destinations, data on financial transactions and records of Internet browsing. The system also would collect information about other people, including those in the U.S., who communicated with people in Detroit.

The information doesn't generally include the contents of conversations or emails. But it can give such transactional information as a cellphone's location, whom a person is calling, and what Web sites he or she is visiting. For an email, the data haul can include the identities of the sender and recipient and the subject line, but not the content of the message.

Intelligence agencies have used administrative subpoenas issued by the FBI -- which don't need a judge's signature -- to collect and analyze such data, current and former intelligence officials said. If that data provided "reasonable suspicion" that a person, whether foreign or from the U.S., was linked to al Qaeda, intelligence officers could eavesdrop under the NSA's Terrorist Surveillance Program.

The White House wants to give companies that assist government surveillance immunity from lawsuits alleging an invasion of privacy, but Democrats in Congress have been blocking it. The Terrorist Surveillance Program has spurred 38 lawsuits against companies. Current and former intelligence officials say telecom companies' concern comes chiefly because they are giving the government unlimited access to a copy of the flow of communications, through a network of switches at U.S. telecommunications hubs that duplicate all the data running through it. It isn't clear whether the government or telecom companies control the switches, but companies process some of the data for the NSA, the current and former officials say.

On Friday, the House Energy and Commerce Committee released a letter warning colleagues to look more deeply into how telecommunications data are being accessed, citing an allegation by the head of a New York-based computer security firm that a wireless carrier that hired him was giving unfettered access to data to an entity called "Quantico Circuit." Quantico is a Marine base that houses the FBI Academy; senior FBI official Anthony DiClemente said the bureau "does not have 'unfettered access' to any communication provider's network."

The political debate over the telecom information comes as intelligence agencies seek to change traditional definitions of how to balance privacy rights against investigative needs. Donald Kerr, the deputy director of national intelligence, told a conference of intelligence officials in October that the government needs new rules. Since many people routinely post details of their lives on social-networking sites such as MySpace, he said, their identity shouldn't need the same protection as in the past. Instead, only their "essential privacy," or "what they would wish to protect about their lives and affairs," should be veiled, he said, without providing examples.

Social-Network Analysis

The NSA uses its own high-powered version of social-network analysis to search for possible new patterns and links to terrorism. The Pentagon's experimental Total Information Awareness program, later renamed Terrorism Information Awareness, was an early research effort on the same concept, designed to bring together and analyze as much and as many varied kinds of data as possible. Congress eliminated funding for the program in 2003 before it began operating. But it permitted some of the research to continue and TIA technology to be used for foreign surveillance.

Some of it was shifted to the NSA -- which also is funded by the Pentagon -- and put in the so-called black budget, where it would receive less scrutiny and bolster other data-sifting efforts, current and former intelligence officials said. "When it got taken apart, it didn't get thrown away," says a former top government official familiar with the TIA program.

Two current officials also said the NSA's current combination of programs now largely mirrors the former TIA project. But the NSA offers less privacy protection. TIA developers researched ways to limit the use of the system for broad searches of individuals' data, such as requiring intelligence officers to get leads from other sources first. The NSA effort lacks those controls, as well as controls that it developed in the 1990s for an earlier data-sweeping attempt.

Sen. Ron Wyden, an Oregon Democrat and member of the Senate Intelligence Committee who led the charge to kill TIA, says "the administration is trying to bring as much of the philosophy of operation Total Information Awareness as it can into the programs they're using today." The issue has been overshadowed by the fight over telecoms' immunity, he said. "There's not been as much discussion in the Congress as there ought to be."

Opportunity for Debate

But Sen. Kit Bond of Missouri, the ranking Republican on the committee, said by email his committee colleagues have had "ample opportunity for debate" behind closed doors and that each intelligence program has specific legal authorization and oversight. He cautioned against seeing a group of intelligence programs as "a mythical 'big brother' program," adding, "that's not what is happening today."READ THE RULING

While the Fourth Amendment guarantees "[t]he right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures," the legality of data-sweeping relies on the government's interpretation of a 1979 Supreme Court ruling allowing records of phone calls -- but not actual conversations -- to be collected without a warrant. Read the ruling.1

The legality of data-sweeping relies largely on the government's interpretation of a 1979 Supreme Court ruling allowing records of phone calls -- but not actual conversations -- to be collected without a judge issuing a warrant. Multiple laws require a court order for so-called "transactional'" records of electronic communications, but the 2001 Patriot Act lowered the standard for such an order in some cases, and in others made records accessible using FBI administrative subpoenas called "national security letters." (Read the ruling.2)

A debate is brewing among legal and technology scholars over whether there should be privacy protections when a wide variety of transactional data are brought together to paint what is essentially a profile of an individual's behavior. "You know everything I'm doing, you know what happened, and you haven't listened to any of the contents" of the communications, said Susan Landau, co-author of a book on electronic privacy and a senior engineer at Sun Microsystems Laboratories. "Transactional information is remarkably revelatory."

Ms. Spaulding, the national-security lawyer, said it's "extremely questionable" to assume Americans don't have a reasonable expectation of privacy for data such as the subject-header of an email or a Web address from an Internet search, because those are more like the content of a communication than a phone number. "These are questions that require discussion and debate," she said. "This is one of the problems with doing it all in secret."

Gen. Hayden, the former NSA chief and now Central Intelligence Agency director, in January 2006 publicly defended the activities of the Terrorist Surveillance Program after it was disclosed by the New York Times. He said it was "not a driftnet over Lackawanna or Fremont or Dearborn, grabbing all communications and then sifting them out." Rather, he said, it was carefully targeted at terrorists. However, some intelligence officials now say the broader NSA effort amounts to a driftnet. A portion of the activity, the NSA's access to domestic phone records, was disclosed by a USA Today article in 2006.

The NSA, which President Truman created in 1952 through a classified presidential order to be America's ears abroad, has for decades been the country's largest and most secretive intelligence agency. The order confined NSA spying to "foreign governments," and during the Cold War the NSA developed a reputation as the world's premier code-breaking operation. But in the 1970s, the NSA and other intelligence agencies were found to be using their spy tools to monitor Americans for political purposes. That led to the original FISA legislation in 1978, which included an explicit ban on the NSA eavesdropping in the U.S. without a warrant.

Big advances in telecommunications and database technology led to unprecedented data-collection efforts in the 1990s. One was the FBI's Carnivore program, which raised fears when it was in disclosed in 2000 that it might collect telecommunications information about law-abiding individuals. But the ground shifted after 9/11. Requests for analysis of any data that might hint at terrorist activity flooded from the White House and other agencies into NSA's Fort Meade, Md., headquarters outside Washington, D.C., one former NSA official recalls. At the time, "We're scrambling, trying to find any piece of data we can to find the answers," the official said.

The 2002 congressional inquiry into the 9/11 attacks criticized the NSA for holding back information, which NSA officials said they were doing to protect the privacy of U.S. citizens. "NSA did not want to be perceived as targeting individuals in the United States" and considered such surveillance the FBI's job, the inquiry concluded.

FBI-NSA Projects

The NSA quietly redefined its role. Joint FBI-NSA projects "expanded exponentially," said Jack Cloonan, a longtime FBI veteran who investigated al Qaeda. He pointed to national-security letter requests: They rose from 8,500 in 2000 to 47,000 in 2005, according to a Justice Department inspector general's report last year. It also said the letters permitted the potentially illegal collection of thousands of records of people in the U.S. from 2003-05. Last Wednesday, FBI Director Robert Mueller said the bureau had found additional instances in 2006.

It isn't known how many Americans' data have been swept into the NSA's systems. The Treasury, for instance, built its database "to look at all the world's financial transactions" and gave the NSA access to it about 15 years ago, said a former NSA official. The data include domestic and international money flows between bank accounts and credit-card information, according to current and former intelligence officials.

The NSA receives from Treasury weekly batches of this data and adds it to a database at its headquarters. Prior to 9/11, the database was used to pursue specific leads, but afterward, the effort was expanded to hunt for suspicious patterns.

Through the Treasury, the NSA also can access the database of the Society for Worldwide Interbank Financial Telecommunication, or Swift, the Belgium-based clearinghouse for records of international transactions between financial institutions, current and former officials said. The U.S. acknowledged in 2006 that the CIA and Treasury had access to Swift's database, but said the NSA's Terrorism Surveillance Program was separate and that the NSA provided only "technical assistance." A Treasury spokesman said the agency had no comment.

Through the Department of Homeland Security, airline passenger data also are accessed and analyzed for suspicious patterns, such as five unrelated people who repeatedly fly together, current and former intelligence officials said. Homeland Security shares information with other agencies only "on a limited basis," spokesman Russ Knocke said.

NSA gets access to the flow of data from telecommunications switches through the FBI, according to current and former officials. It also has a partnership with FBI's Digital Collection system, providing access to Internet providers and other companies. The existence of a shadow hub to copy information about AT&T Corp. telecommunications in San Francisco is alleged in a lawsuit against AT&T filed by the civil-liberties group Electronic Frontier Foundation, based on documents provided by a former AT&T official. The Week in Review is edited and published by Jack Spratts. In that lawsuit, a former technology adviser to the Federal Communications Commission says in a sworn declaration that there could be 15 to 20 such operations around the country. Current and former intelligence officials confirmed a domestic network of hubs, but didn't know the number. "As a matter of policy and law, we can not discuss matters that are classified," said FBI spokesman John Miller.

The budget for the NSA's data-sifting effort is classified, but one official estimated it surpasses $1 billion. The FBI is requesting to nearly double the budget for the Digital Collection System in 2009, compared with last year, requesting $42 million. "Not only do demands for information continue to increase, but also the requirement to facilitate information sharing does," says a budget justification document, noting an "expansion of electronic surveillance activity in frequency, sophistication, and linguistic needs."
http://online.wsj.com/public/article...377523845.html





Database of Every Phone Call and Email 'a Step Too Far'
Peter Walker

The information commissioner today expressed concern at a proposed government database recording the entire country's telephone and internet use, calling it "a step too far for the British way of life".

Richard Thomas, who heads the government's privacy watchdog, the Information Commissioner's Office (ICO), said there was a grave danger of the police and security services prying into "more and more aspects of our private lives".

There had been too many recent examples of personal data being gathered and collated by officials without proper parliamentary scrutiny or public debate, Thomas said today at the launch of his office's annual report.

At the same time, the ICO announced it was serving enforcement notices against Revenue & Customs and the MoD following recent cases of data mismanagement, obliging them to explain what improvements have been made.

It emerged in November that Revenue & Customs had lost 25m child benefit records on unencrypted discs sent by courier. Early this year the MoD said 600,000 people's personal details had been lost when a laptop was stolen.

Today, Thomas argued that every time a new database was launched the government must consider "the impact on individuals' liberties and on society as a whole".

He added: "Sadly, there have been too many [privacy] developments where there has not been sufficient openness, transparency or public debate."

Thomas – whose office warned last year that Britain was "sleepwalking" into a fully fledged surveillance society – said he had grave doubts about the mooted communications database.

Under the proposals, which could become part of the new data communications bill, telecoms companies and internet service providers would be compelled to hand over details of every phone call made, email sent and minute spent on the internet by the public.

The information would be stored for at least 12 months and police, security services and other agencies across Europe would have access to the database with court permission.

"I am absolutely clear that the targeted, and duly authorised, interception of the communications of suspects can be invaluable in the fight against terrorism and other serious crime," Thomas said.

"But there needs to be the fullest public debate about the justification for, and implications of, a specially created database – potentially accessible to a wide range of law enforcement authorities – holding details of everyone's telephone and internet communications.

"Do we really want the police, security services and other organs of the state to have access to more and more aspects of our private lives?"

Other recent examples of new information sources being collected without proper debate were the expansion of the DNA database and the centralised collection of data from number plate recognition cameras, he added.
http://www.guardian.co.uk/uk/2008/ju...ivacy.internet





Logged In or Out, Facebook is Watching You
Brett Winterford

Researchers at software vendor CA have discovered that social networking site Facebook is able to track the buying habits of its users on affiliated third-party sites even when they are logged out of their account or have opted out of its controversial "Beacon" tracking service.

Beacon, launched in November, tracks the transactions Facebook users make at e-commerce sites such as ticketing company Fandango and Blockbuster Video, in order to list them in the user's "mini-feed". It is intended, Facebook claims, as a means of "social marketing" -- users recommending products and services to their peers.

Responding to privacy concerns, Facebook has since moved to reassure users that it only tracks and publishes data about their purchases if they are both logged in to Facebook and have opted-in to having this information listed on their profile.

But in "extremely disconcerting" findings that directly contradict these assurances, researchers at CA's Security Advisory service have found that data about these transactions are sent to Facebook regardless of a user's actions.

Tests by CA researcher Stefan Berteau, published here, seem to prove the point.

During the test, Berteau executed actions (saved a recipe) on Facebook affiliate site epicurious.com three times.

In the first instance, he saved a recipe while still logged in to Facebook.

"An alert appeared allowing me to opt-out of Facebook's publishing this as a story on my feed, which I did," he said.

He then saved a recipe on Epicurious.com with the Facebook window closed, but while he was still logged in to Facebook. Again he was alerted, and this time chose "No, thanks" -- and therefore opting out of the service.

He then saved a third recipe while he was completely logged out of the Facebook site under a new browser session, and received no alert.

Berteau then consulted CA's network traffic logs, and found that in all three cases, data (such as his Facebook account name and details of his actions on the affiliate site) had been submitted to Facebook.

Berteau claims the results of the tests prove that Facebook is able to collect information about its members' surfing habits on affiliate sites, regardless of whether permission has been granted.

Facebook replied to CA's concerns in a letter describing the ease with which user's can opt out of having the purchasing information listed on the "mini-feed" on their profile.

"I replied explaining that I was not particularly worried about the feeds, which are only shown to friends who I have previously vetted, but that I was more concerned about the silently collected data, particularly the possibility of that data being sold to third parties," Berteau said.

Facebook has since released a statement claiming that it has no choice but to collect the data so that it can be used should the user decide to "opt-in" to the service.

"If a Facebook user clicks 'No, thanks' on the partner site notification, Facebook does not use the data and deletes it from its servers.

"Separately, before Facebook can determine whether the user is logged in, some data may be transferred from the participating site to Facebook. In those cases, Facebook does not associate the information with any individual user account, and deletes the data as well," the statement said.

Berteau said that while such a statement is reassuring, there is nothing in Facebook's privacy policy that acknowledges it doesn't store or use that data.

"The fact that the data continues to be sent to Facebook.com continues to pose a risk to user's privacy until a binding, public mechanism is in place to assure that the above policy stays in place, and that users are notified if it ever changes.

"Facebook's privacy policy is such a mechanism. Officially stating in its policy that it will not store or use data which is not associated with a logged in Facebook account which opted in to Beacon would go a long way towards providing clarity and an assurance of privacy towards their users," he said.
http://www.zdnet.com.au/news/securit...9284281,00.htm





Unrepentant on Facebook? Expect Jail Time
AP

Two weeks after Joshua Lipton was charged in a drunken driving crash that seriously injured a woman, the 20-year-old college junior attended a Halloween party dressed as a prisoner. Pictures from the party showed him in a black-and-white striped shirt and an orange jumpsuit labeled "Jail Bird."

Prosecutors pounced when this party photo of Joshua Lipton in a "Jail Bird" costume appeared on Facebook.

In the age of the Internet, it might not be hard to guess what happened to those pictures: Someone posted them on the social networking site Facebook. And that offered remarkable evidence for Jay Sullivan, the prosecutor handling Lipton's drunken-driving case.

Sullivan used the pictures to paint Lipton as an unrepentant partier who lived it up while his victim recovered in the hospital. A judge agreed, calling the pictures depraved when sentencing Lipton to two years in prison.

Online hangouts like Facebook and MySpace have offered crime-solving help to detectives and become a resource for employers vetting job applicants. Now the sites are proving fruitful for prosecutors, who have used damaging Internet photos of defendants to cast doubt on their character during sentencing hearings and argue for harsher punishment.

"Social networking sites are just another way that people say things or do things that come back and haunt them," said Phil Malone, director of the cyberlaw clinic at Harvard Law School's Berkman Center for Internet & Society. "The things that people say online or leave online are pretty permanent."

The pictures, when shown at sentencing, not only embarrass defendants but can make it harder for them to convince a judge that they're remorseful or that their drunken behavior was an aberration. (Of course, the sites are also valuable for defense lawyers looking to dig up dirt to undercut the credibility of a star prosecution witness.)

Prosecutors do not appear to be scouring networking sites while preparing for every sentencing, even though telling photos of criminal defendants are sometimes available in plain sight and accessible under a person's real name. But in cases where they've had reason to suspect incriminating pictures online, or have been tipped off to a particular person's MySpace or Facebook page, the sites have yielded critical character evidence.

"It's not possible to do it in every case," said Darryl Perlin, a senior prosecutor in Santa Barbara County, California. "But certain cases, it does become relevant."

Perlin said he was willing to recommend probation for Lara Buys for a drunken driving crash that killed her passenger last year, until he thought to check her MySpace page while preparing for sentencing.

The page featured photos of Buys, taken after the crash but before sentencing, holding a glass of wine as well as joking comments about drinking. Perlin used the photos to argue for a jail sentence instead of probation, and Buys, then 22, got two years in prison.

"Pending sentencing, you should be going to [Alcoholics Anonymous]; you should be in therapy; you should be in a program to learn to deal with drinking and driving," Perlin said. "She was doing nothing other than having a good old time."

Santa Barbara defense lawyer Steve Balash said the day he met client Jessica Binkerd, a recent college graduate charged in a fatal drunken driving crash, he asked whether she had a MySpace page. When she said yes, he told her to take it down because he figured it might have pictures that cast her in a bad light.

But she didn't remove the page. And right before Binkerd was sentenced in January 2007, the attorney said, he was "blindsided" by a presentencing report from prosecutors that featured photos posted on MySpace after the crash.

One showed Binkerd holding a beer bottle. Others had her wearing a shirt advertising tequila and a belt bearing plastic shot glasses.

Binkerd wasn't doing anything illegal, but Balash said the photos hurt her anyway. She was given more than five years in prison, though the sentence was later shortened for unrelated reasons.

"When you take those pictures like that, it's a hell of an impact," he said.

Rhode Island prosecutors say Lipton was drunk and speeding near his school, Bryant University in Smithfield, in October 2006 when he triggered a three-car collision that left 20-year-old Jade Combies hospitalized for weeks.

Sullivan, the prosecutor, said another victim of the crash gave him copies of photographs from Lipton's Facebook page that were posted after the collision. Sullivan assembled the pictures, which were posted by someone else but accessible on Lipton's page, into a PowerPoint presentation at sentencing.

One image shows a smiling Lipton at the Halloween party, clutching cans of the energy drink Red Bull with his arm draped around a young woman in a sorority T-shirt. Above it, Sullivan rhetorically wrote, "Remorseful?"

Superior Court Judge Daniel Procaccini said the prosecutor's slide show influenced his decision to sentence Lipton.

"I did feel that gave me some indication of how that young man was feeling a short time after a near-fatal accident, that he thought it was appropriate to joke and mock about the possibility of going to prison," the judge said.

Kevin Bristow, Lipton's attorney, said the photos didn't accurately reflect his client's character or level of remorse and made it more likely he'd get prison over probation.

"The pictures showed a kid who didn't know what to do two weeks after this accident," Bristow said, adding that Lipton wrote apologetic letters to the victim and her family and was so upset that he left college. "He didn't know how to react."

Still, he uses the incident as an example to his own teenage children to watch what they post online.
"If it shows up under your name, you own it," he said, "and you better understand that people look for that stuff."
http://www.cnn.com/2008/CRIME/07/18/....ap/index.html





O2 Leaking Customer Photos?

Mobile Network Operators have been providing SMS text messaging capabilities for years but it's only recently that MMS (Multimedia Messaging Service) enabled cell phones have become more popular. It allows an owner of the phone to take a photo and immediately send it to another MMS enabled cellphone. So what happens if a MMS enabled phone sends an e-mail to a non-MMS phone? Well, the mobile operators have thought of that and can host the images on their website and notify the user by text message or e-mail that a new photo is available to view.

You may assume that if you use this service to send a photo to a friend that your photo is protected and not broadcast for the entire world to see. Unfortunately, this may not be the case if there isn't proper authentication, such as username and password login, to the mobile network operators website that's hosting the images and here's an example of that case.

Earlier today, we received an e-mail from O2 that was sent to an incorrect recipient. It's quite likely that an e-mail address was entered incorrectly by the person setting up the account. I was surprised that we were able to view the image without having to login to the website but figured a strict combination of a unique user id number and unique image id would be required making it incredibly difficult to guess. After all, it wouldn't be possible to access these images without receiving a misaddressed e-mail, right? Wrong!

I looked at the URL in the e-mail and found the only requirement was a 16 digit hex number. [Update: A few readers pointed out that a 64-bit key results in a HUGE number of possibilities to guess 10^19. However, as I can obtain the keys via another security hole no guessing is required - I'm not going to release that information yet as I'd like O2 to fix this]. As these web pages were wide open to the internet, not requiring any authentication a very small handful were indexed by Google. I was able to craft a Google search that results in some matches to show an example of how this is an insecure method of hosting:

http://www.google.com/search?hl=en&q...&sa=N&filter=0

Worse still, the majority of the images taken on cameras turns out to be children. Ironically, O2 has a website dedicated to "Protect Our Children", well a good first step would be to avoid leaking customer photos.

Update: Someone posted this story to the O2 Customer Forum website but the thread has mysteriously disappeared. Hmmm....I wonder why? The thread discussing this in the forum was here but now simply returns "The topic or post you requested does not exist" webpage. Google did manage to grab it....

Since then I've found the follow discussion of the issue on the O2 Customer Forum that hasn't yet been removed.....
http://blog.mailchannels.com/2008/07...er-photos.html





Lawmakers Probe Web Tracking

Panel Examining Ad Technology for Privacy Concerns
Ellen Nakashima

An Internet provider based in Kansas used a monitoring technology earlier this year to track sites visited by its users, apparently without directly notifying them, according to a congressional panel investigating the action.

Embarq, which serves 1.3 million Internet customers in 18 states, including Virginia, acknowledged that it used "deep packet inspection" technology provided by the Silicon Valley firm NebuAd to direct targeted advertising to users.

Some lawmakers and others question whether such actions violate users' rights to keep their Internet behavior to themselves. The House Energy and Commerce subcommittee on telecommunications and the Internet will take up the subject at a hearing today.

"Surreptitiously tracking individual users' Internet activity cuts to the heart of consumer privacy," said Rep. Edward J. Markey (D-Mass.), the panel's chairman. "Embarq's apparent use of this technology without directly notifying affected customers that their activity was being tracked, collected and analyzed raises serious privacy red flags."

Federal wiretap laws generally require consumers to consent to the collection and use of their communications. There has been ongoing debate over whether the technology's use for behavioral targeting violates these laws.

Developed to speed the routing of Internet communications, deep packet inspection has evolved to include such uses as detecting viruses. Recently it has been turned toward the lucrative online advertising business. But the move into marketing has raised privacy concerns that could slow its adoption by large service providers, industry experts said.

Online ad companies like Google can track users' browsing behavior only on Web pages that host its ads. In contrast, deep packet inspection technology installed in an Internet service provider's network permits a window into potentially all of a consumer's online activity, from Web surfing and search terms to any unencrypted Web communication, experts said.

"We see virtually every site that you go to. This gives us much greater reach, relevance and results for our advertisers," NebuAd chief executive Bob Dykes told an audience of online media and advertising executives in New York in February. "We actually see not only that you went to all these sites, we know what you did on the sites. For example, if you went to a travel site, we know that you're looking to go to Las Vegas or the south of France."

In an interview yesterday, Dykes said that NebuAd does not collect or keep a person's name or other "personally identifiable information'' but rather tracks the sites he visits, linking them to an encrypted, anonymous identifier.

NebuAd can, but does not, monitor e-mail, instant messages or Internet phone calls, a spokeswoman said.

"Our position is well-supported," Dykes said, "that we operate within the law."

But Alissa Cooper, chief computer scientist for the Center for Democracy and Technology, said that what NebuAd and similar firms are doing is akin to wiretapping without the subject's permission.

"This is an obvious privacy violation even when the eavesdropper does not know your identity," she said. "The issue we have is with the interception itself. We think people simply do not expect a middleman to be sitting between them and the Web sites they visit."

This week, Markey, committee Chairman John D. Dingell (D-Mich.) and Rep. Joe L. Barton (R-Tex.) sent a letter to Embarq seeking to know, among other things, where the firm tested the technology, with how many subscribers and why it chose to proceed without first asking customers whether they wanted to opt in.

A "minuscule" subset of customers was targeted in the test, which ended in March, said a source familiar with the test who spoke on condition of anonymity.

Embarq spokeswoman Debra Peterson said company officials "are reviewing [the letter] for an appropriate response."

Last month, Charter Communications of St. Louis, the country's fourth-largest cable operator, backed off a plan to partner with NebuAd, citing "questions about this service" from customers.

Dykes said that "clearly quite a few" service providers have suspended their arrangements, which proves the need to "better educate the public" about NebuAd's privacy policies. For instance, he said, providers can offer consumers direct online notice that their browsing activity will be tracked for ad purposes and that they may opt out of this.

The new technology, said Emily Riley, online advertising analyst with Jupiter Research, "is almost too exciting for marketers to resist" but also is "a minefield" for privacy because of what she calls the creepiness factor.

"If you remind people that you're tracking them -- 'Hey, I know that you recently started wearing medium T-shirts instead of large. Did you lose weight?' That's creepy," she said.

Staff researcher Madonna Lebling contributed to this report.
http://www.washingtonpost.com/wp-dyn...071602378.html





Don’t Use FTP
Steven Frank.

This is going to sound a little weird at first considering what I do for a living, but I want you to stop using FTP.

FTP is a 23 year old protocol. Although the basics of what it does still work, there are many aspects of it which have not kept up with modern computing environments.

In particular:

• Unless tunneled over a secure socket, FTP is 100% insecure. Your password, and the contents of all of your files are sent in the clear, free to be examined or captured by any network hop between you and your server.

• The spec defines no way of setting the modification dates/times of files. A number of non-standard extensions have arisen to deal with this shortcoming. Some servers support one but not the others. Some support neither. Some claim to support one method but misinterpret the the arguments, treating the timestamps as local time rather than UTC. I've seen FTP servers simply drop the connection whenever asked to set a timestamp on a file. For such a simple and necessary operation, it's chaos.

• The spec defines no reliable way of determining the string encoding used for filenames. We are able to get it right some of the time using educated guesses, but it's hardly reliable. The internet has made the world smaller than ever, and the world simply needs to use protocols that support international character sets.

• FTP was designed to be used interactively by a human sitting at a terminal, not by a GUI application working on the human's behalf. The spec doesn't even define the output format that should be used for directory listings. Half of the work in writing a decent FTP client is being able to interpret the hundreds of different types of directory listings you might receive without much hint as to which type the server is sending. This leads to all kinds of subtle glitches. For example, for files more than a year old appearing in Unix style directory listings it's impossible to determine their modification date without using additional (and likely unsupported) non-standard commands. Sending such per-file commands kills performance. It's also impossible to reliably handle unusual cases such as leading/trailing spaces in filenames without hints from the user about the type of server on the other end.

• The spec defines no way of dealing with file metadata, such as Unix permissions, owners, and groups. Again, various servers have implemented extensions for working with this, but you cannot rely on their presence or interoperability.

• FTP requires a minimum of two socket connections to transfer a file: the control connection, which is established first, and then data connections which are created and destroyed every time you transfer a single file, or request a directory listing. This is deadly to your overall throughput, especially on a high-latency internet connection. And worse, it leads to the next problem:

• FTP is not friendly with firewalls. Because it constantly needs to establish new connections, this has led us to "passive mode" which might as well be black magic as far as most people are concerned. Briefly, passive mode means the client initiates data connections to the server, rather than the default where the server makes connections to the client (yes, really). Worse still, data connections occur on varying high port numbers (usually 49152-65335) which means sysadmins would have to open over 16,000 ports in the firewall, almost defeating the purpose of a firewall in the first place. It's a mess, and it's really hard to understand. Firewalls are a necessary evil for today's internet, and our transfer protocols should be able to deal with them.

So, if not FTP, what should you use instead? Of what's available today, I'd recommend everyone switch to SFTP if you possibly can.

It's secure, it's consistently implemented, and it's machine-readable. That all adds up to a more reliable, future-proof transfer client for you.

I've talked to a lot of people who didn't even realize their host supported SFTP. If your hosting service supports SFTP, you usually don't have to change anything except for switching your client protocol from FTP to SFTP. If it doesn't work, you should ask your host if there's anything else you have to do (such as use a different port number).

If your host doesn't support SFTP, you should find a different host. It's not hard to support, and it's ridiculous to force people into using insecure protocols in the year 2008. Ask them, for example, why they don't support telnet. FTP is no better.

FTP has served us well, but it's time to move on. You wouldn't use a 23 year old computer to do your work, so don't use a protocol from the same vintage. Demand modern transfer protocols from your host.

Quick Update

Several people have taken issue with me calling out the age of the protocol. After all, Ethernet, IP, Unix, HTML, and so on are also quite old, but seem to be holding up OK.

I guess it was a silly point to bring up. I hope it's at least obvious from the article that I'm not suggesting that FTP's age is its primary problem, but rather the issues in the bulleted list.

The difference between FTP and other old-but-still-useful tech is that the others have been updated periodically to keep pace with the rapid evolution of the industry.

Ethernet now has CAT6. IP is (sort of... slowly...) mutating into IPV6. Unix has had so many mutations it would be hard to name them all. HTML is coming up on version 5.

FTP is just FTP, pretty much same as it was when Jon Postel & co. wrote it. We've wrapped it in secure tunnels and thrown countless proprietary extensions at it (that nobody agrees on how to implement). But it's my opinion (and certainly not everybody's) that it's broken at a fundamental level for its intended purpose for today's internet.

So, yes, the age of the protocol BY ITSELF is a non-argument. It's that it has languished for that long without any cleanup from any standards organization or committee. SFTP seems the best candidate to replace it since it is widely deployed, solves pretty much all the problems I mentioned, and in most cases is an easy substitution for end users to make. Of the realistic solutions to the problem (not "let's write a new protocol!") it's the most accessible.

Folks, I'm a Newton user. You don't have to tell me that age does not necessarily equal irrelevance.
http://stevenf.com/archive/dont-use-ftp.php





Printer Dots Raise Privacy Concerns
Thomas Frank

The affordability and growing popularity of color laser printers is raising concerns among civil liberties advocates that your privacy may not be worth the paper you're printing on.

More manufacturers are outfitting greater numbers of laser printers with technology that leaves microscopic yellow dots on each printed page to identify the printer's serial number — and ultimately, you, says the San Francisco-based Electronic Frontier Foundation, one of the leading watchdogs of electronic privacy.

The technology has been around for years, but the declining price of laser printers and the increasing number of models with this feature is causing renewed concerns.

The dots, invisible to the naked eye, can be seen using a blue LED light and are used by authorities such as the Secret Service to investigate counterfeit bills made with laser printers, says Lorelei Pagano, director of the Central Bank Counterfeit Deterrence Group.

Privacy advocates worry that the little-known technology could ensnare political dissidents, whistle-blowers or anyone who prints materials that authorities want to track.

"There's nothing about this technology that limits its application to counterfeit investigations," says Seth Schoen, a computer programmer with the Electronic Frontier Foundation. "Some people who aren't doing anything wrong may have their privacy threatened." Schoen's tests have found the dots produced by 111 color laser printers made by 13 companies including Xerox, Canon, Hewlett-Packard, Epson and Brother.

The dots are produced only on laser devices and not ink-jet printers, which are most commonly used at home. But laser printers, which produce more durable images, are becoming increasingly popular as their price has dropped to as low as $300, says Angele Boyd, a vice president of IDC Research.

Although laser printers made up only 4% of the 33 million printers sold last year in the USA, their sales have been growing by double digits since 2004, Boyd says.

The technology began as laser printers were first produced in the mid-1980s and governments and banks feared an explosion of counterfeiting, Xerox spokesman Bill McKee says. "In many cases, it is a requirement to do business internationally that the printers are equipped with this technology," McKee says.

The dots tell authorities the serial number of a printer that made a document. In some cases, it also tells the time and date it was printed, Pagano says. "The Secret Service is the only U.S. body that has the ability to decode the information," she says.
Printer makers "cooperate with law enforcement" and will tell authorities where a printer was made and sold, McKee says.

The Secret Service uses the dots only to investigate counterfeiting, agency spokesman Ed Donovan says.
http://www.usatoday.com/tech/news/su...-printer_N.htm





Survival Time on the Internet
Lorna Hutcheson

I have been asked many by people if I really believed the survival time graph on the ISC site was truly an accurate representation of how long a new system had once connected. The answer to this is yes for most home users and systems that are internet facing. It can be longer depending on the system, what sits in front of it and what it is used for. The survival time is currently around 4 minutes for unpatched systems. That is not much time at all and the window has shrunk over the past couple of years. If you want to do your own experiment by placing a sacrificial system out there, its really a fun thing to do! Don't patch the system and see how long it takes before it receives its first probes and actually becomes compromised. Just make sure you monitor and its not used against others. If you really want to do this, I'd advise checking out the Honeynet Project.

The battle, in my experience, is waged between the admins and management who want to get this system up and working and security who is saying not until its been patched and its security posture confirmed. More than once, I've dealt with a compromise of a system that was place on the network before it was hardened. I got the same answer every time "We needed it working ASAP". However, more time was spent playing clean up from it than if it was just done right the first time.

What I'm really curious about are any experiences that you have had for survival time on the internet that you can share. Please feel free to sanitize them as necessary and let us know if they can be posted. What was placed on the network and why? What was the impact, if any, to other systems? How long was the system out there before it was compromised. Also, if you have been able to use the survival time graph as a method of showing why its important to properly secure a system first, please let us know that too.

Update 1100 UTC by Daniel Wesemann:

ISC reader Dr. Neal Krawetz deliberately exposed the management ports of several brands of cable modem / home router devices to the Internet to see if they would be compromised. Within the week that the experiment lasted, none of them were.

Thorsten Holz from the German Honeynet Project wrote a very interesting blog entry, complete with statistics and graphs, in response to this ISC diary. Read it here http://honeyblog.org/archives/193-Su...e-Fittest.html

While the survival time measured varies quite a bit across methods used, pretty much all agree that placing an unpatched Windows computer directly onto the Internet in the hope that it downloads the patches faster than it gets exploited are odds that you wouldn't bet on in Vegas. Using a NAT router and a correctly configured personal firewall is the way to go - both these measures help a lot to improve the odds in favor or your PC.
http://isc.sans.org/diary.html?storyid=4721





New Worm Transcodes MP3s to Try to Infect PCs

Windows users who download music files on peer-to-peer networks are at risk from new malware that inserts links to dangerous Web pages within ASF media files
Jeremy Kirk

A new kind of malicious software could pose a danger to Windows users who download music files on peer-to-peer networks.

The new malware inserts links to dangerous Web pages within ASF (Advanced Systems Format) media files.

"The possibility of this has been known for a little while but this is the first time we've seen it done," said David Emm, senior technology consultant for security vendor Kaspersky Lab.

Advanced Systems Format is a Microsoft-defined container format for audio and video streams that can also hold arbitrary content such as images or links to Web resources.

If a user plays an infected music file, it will launch Internet Explorer and load a malicious Web page which asks the user to download a codec, a well-known trick to get someone to download malware.

The actual download is not a codec but a Trojan horse, which installs a proxy program on the PC, Emm said. The proxy program allows hackers to route other traffic through the compromised PC, helping the hacker essentially cover their tracks for other malicious activity, Emm said.

The malware has worm-like qualities. Once on a PC, it looks for MP3 or MP2 audio files, transcodes them to Microsoft's Windows Media Audio format, wraps them in an ASF container and adds links to further copies of the malware, in the guise of a codec, according to another security analyst, Secure Computing.

The ".mp3" extension of the files is not modified, however, so victims may not immediately notice the change, according to Kaspersky Lab.

Most savvy PC users are aware of the codec ruse, but the style of attack is still effective since many media players do need to receive updated codecs occasionally in order to play files.

"Users downloading from P2P networks need to exercise caution anyway, but should also be sensitive to pop-ups appearing upon playing a downloaded video or audio stream," Secure Computing said.

Users on a digital audio enthusiast site differed over the danger level of the malware.

"I never allow programs to choose which codecs I use to play back media," wrote JXL on the Hydrogen Audio forum "I research it and get the codec bundles off of sites I know to be trustworthy and even then I still scan them and check to make sure they are what they are. I honestly don't feel that this malware has a very good chance of spreading fast."

But most users will probably think the prompt to download a codec is just routine business, wrote a user by the nickname of Citay on the same forum.

"I think that outside a minority of users who really know about all the dangers implied with Internet use, the vast majority of people have no idea that such a codec download could lead to a Trojan infection," Citay wrote.

Trend Micro calls the malware "Troj_Medpinch.a," Secure Computing named it " "Trojan.ASF.Hijacker.gen" and Kaspersky calls it "Worm.Win32.GetCodec.a."
http://www.infoworld.com/article/08/...ect_PCs_1.html





Cybercrime Organizational Structures and Modus Operandi
Mirko Zorz

Finjan announced the latest findings by its Malicious Code Research Center (MCRC). In its latest trends report for Q2 2008, the MCRC identifies and analyzes the latest Crimeware business operations, and provides a first-of-its-kind insider's look at the organizational structure of Cybercrime organizations. It all makes the cybercrime more successful and profitable than ever.

The report includes real documented discussions conducted by Finjan's researchers with resellers of stolen data and their "bosses", confirming Finjan's analysis of the current state of the cybercrime economy.

The report explores the trend of loosely organized clusters of hackers trading stolen data online being replaced by hierarchical cybercrime organizations. These organizations deploy sophisticated pricing models, Crimeware business models refined for optimal operation, Crimeware drop zones, and campaigns for optimal distribution of the Crimeware.

These cybercrime organizations consist of strict hierarchies, in which each cybercriminal is rewarded according to his position and task. The "boss" in the cybercrime organization operates as a business entrepreneur and does not commit the cybercrimes himself. Directly under him is the "underboss", acting as the second in command and managing the operation.

This individual provides the Trojans for attacks and manages the Command and Control (C&C) of those Trojans. "Campaign managers" reporting to the underboss lead their own attack campaigns. They use their own "affiliation networks" as distribution channels to perform the attacks and steal the data. The stolen data is sold by "resellers", who are not involved in the Crimeware attacks themselves.

As a preventative measure, businesses should look closely at their security practices to make sure they are protected. A layered security approach is a highly effective way of handling these latest threats, and applying innovative security solutions, such as real-time content inspection, designed to detect and handle them is a key factor is being adequately protected.
http://www.net-security.org/secworld.php?id=6325





U.S. Fears Threat of Cyberspying at Olympics
Siobhan Gorman

A debate is brewing in the U.S. government over whether to publicly warn businesspeople and other travelers heading to the Beijing Olympics about the dangers posed by Chinese computer hackers.MORE

• The Department of Homeland Security last month warned of cyber threats1 facing overseas travelers but did not release the information to the public.
• The U.S. Cyber Consequences Unit assembled sets of guidelines2 for determining whether you are a likely target of cyber-espionage; how to deliver a presentation without a laptop; and securing your laptop when traveling abroad.

According to government officials and security consultants, U.S. intelligence agencies are worried about the potential threat to U.S. laptops and cellphones. But others, including the State and Commerce departments and some companies, are trying to quiet the issue for fear of offending the Chinese, these people say.

Barack Obama became the first major presidential candidate to propose new cybersecurity policies Wednesday when he unveiled his cybersecurity strategy, which includes combating corporate espionage, shielding the country's Internet infrastructure and establishing a national cybersecurity adviser.

U.S. intelligence and security officials are concerned by the frequency with which spies in China and other countries are targeting traveling U.S. corporate and government officials. The Department of Homeland Security issued a warning last month to certain government and private-sector officials stating that business and government travelers' electronic devices are often targeted by foreign governments. The warning wasn't available to the public.

The spy tactics include copying information contained in laptop computers at airport checkpoints or hotel rooms, wirelessly inserting spyware on BlackBerry devices, and a new technique dubbed "slurping" that uses Bluetooth technology to steal data from electronic devices.

In addition to cybersecurity threats in other countries, "so many people are going to the Olympics and are going to get electronically undressed," said Joel Brenner, the government's top counterintelligence officer. He tells of one computer-security expert who powered up a new Treo hand-held computer when his plane landed in China. By the time he got to his hotel, a handful of software programs had been wirelessly inserted.

Mr. Brenner says he doesn't take a laptop to China and uses disposable cellphones while there.

Asked about potential electronic surveillance during the Olympics, a spokesman for China's Ministry of Foreign Affairs said: "Allegations that China supports hacker attacks against U.S. computer networks ... are entirely fabricated, and seriously misleading."

Some companies are taking steps to increase security. General Electric Co. encourages traveling employees to leave laptops behind or use a stripped-down travel laptop and encrypted hard drives, said spokesman Jeff DeMarrais. Pfizer Inc. is evaluating a policy that would require employees to take travel laptops to a number of countries, including China, said spokesman Chris Loder.

Despite the risks, many government and corporate officials are leery of discussing the security risks and singling out countries, such as China, for fear of damaging diplomatic and business relationships. One member of a task force at the Office of the Director of National Intelligence, the U.S.'s top spy agency, said the prospect of an Olympics warning comes up repeatedly, but is never resolved, with technology experts advocating a warning and government officials arguing against it.

One credit-card company executive said many in his industry "are becoming almost afraid of the security issue." Lawyers at credit-card companies have advised against taking some security measures, fearing the company could be liable if they fail, this person said.

Western companies' responses to the problem have ranged from "very concerned to positively ostrich-like," said Mr. Brenner.

The government has no established system for telling travelers about cybersecurity risks. The State Department issues alerts for terrorism and health risks, but not for cybersecurity. That's inconsistent with the government's position on terrorism alerts, says Paul Kurtz, a former National Security Council official who is now a cybersecurity consultant. The government is prohibited from withholding terrorist threats from the public, but that's effectively what it's doing with cyberthreats, he says.

The State Department men tions Chinese cyberthreats briefly on its Web site, noting that computers in hotel rooms may be searched. That information "is basically the extent of any concerns," a department official said.

Mr. Kurtz suggests that the government develop a warning system assigning countries a threat level. Intelligence agencies already produce an annual classified country-by-country report on cyberspying abilities.

Homeland Security's nonpublic assessment, issued last month, doesn't single out any countries. It was issued less than two months before the Olympics and shortly after reports that a U.S. government laptop may have been hacked during a December trip to China by the U.S. Commerce secretary.

This unclassified document wasn't made public. Department spokesman Russ Knocke said the assessment was shared with the department's "state, local, and private-sector partners" but not with the public because such notices are usually the State Department's responsibility and the assessment didn't point to a specific threat. The department tries to avoid inundating the public with nonspecific information, he said.

--Jason Dean in Beijing contributed to this article.
http://online.wsj.com/article/SB121625646058760485.html





S.F. Officials Locked Out of Computer Network
Jaxon Van Derbeken

A disgruntled city computer engineer has virtually commandeered San Francisco's new multimillion-dollar computer network, altering it to deny access to top administrators even as he sits in jail on $5 million bail, authorities said Monday.

Terry Childs, a 43-year-old computer network administrator who lives in Pittsburg, has been charged with four counts of computer tampering and is scheduled to be arraigned today.

Prosecutors say Childs, who works in the Department of Technology at a base salary of just over $126,000, tampered with the city's new FiberWAN (Wide Area Network), where records such as officials' e-mails, city payroll files, confidential law enforcement documents and jail inmates' bookings are stored.

Childs created a password that granted him exclusive access to the system, authorities said. He initially gave pass codes to police, but they didn't work. When pressed, Childs refused to divulge the real code even when threatened with arrest, they said.

He was taken into custody Sunday. City officials said late Monday that they had made some headway into cracking his pass codes and regaining access to the system.

Childs has worked for the city for about five years. One official with knowledge of the case said he had been disciplined on the job in recent months for poor performance and that his supervisors had tried to fire him.

"They weren't able to do it - this was kind of his insurance policy," said the official, speaking on condition of anonymity because the attempted firing was a personnel matter.

Authorities say Childs began tampering with the computer system June 20. The damage is still being assessed, but authorities say undoing his denial of access to other system administrators could cost millions of dollars.

Officials also said they feared that although Childs is in jail, he may have enabled a third party to access the system by telephone or other electronic device and order the destruction of hundreds of thousands of sensitive documents.

Authorities have searched Childs' home and car for a device that could be used in such an attack, but so far no such evidence has been found.

As part of his alleged sabotage, Childs engineered a tracing system to monitor what other administrators were saying and doing related to his personnel case, law enforcement officials said.

Childs became the target of suspicions inside the technology agency this year, and the case was referred for police investigation in late June, authorities say.

At a news conference announcing Childs' arrest, District Attorney Kamala Harris was tightlipped about what his motive may have been.

"Motive is not necessarily an element of a crime," Harris said. "This city employee committed four felonies."

She added, "This involves compromising a public system that we rely on. Its integrity has been compromised."

The system continues to operate even though administrators have limited or no access, officials said.

"Right now our system is up and running and we haven't had any problems so far," said Ron Vinson, chief administrative officer for the Department of Technology.

Vinson said the city is "working around the clock" to make sure the system is maintained and operable.

Nathan Ballard, a spokesman for Mayor Gavin Newsom, said the mayor was "confident that (the Department of Technology) is doing everything necessary to maintain the integrity of the city's computer networks."

Childs appeared in court Monday but did not have a lawyer assigned to him.

Childs, according to payroll records, earned $126,735 in base pay in 2007 and additional premium pay of $22,534, for a total of $149,269. Vinson said the extra money was apparently compensation for being on-call as a trouble-shooter.
http://www.sfgate.com/cgi-bin/articl...BAOS11P1M5.DTL





Why San Francisco's Network Admin Went Rogue

An inside source reveals details of missteps and misunderstandings in the curious case of Terry Childs, network kidnapper
Paul Venezia

Last Sunday, Terry Childs, a network administrator employed by the City of San Francisco, was arrested and taken into custody, charged with four counts of computer tampering. He remains in jail, held on $5 million bail. News reports have depicted a rogue admin taking a network hostage for reasons unknown, but new information from a source close to the situation presents a different picture.

In posts to my blog, I postulated about what might have occurred. Based on the small amount of public information, I guessed that the situation revolved around the network itself, not the data or the servers. A quote from a city official that Cisco was getting involved seemed to back that up, so I assumed that Childs must have locked down the routers and switches that form the FiberWAN network, and nobody but Childs knew the logins. If this were true, then regaining control over those network components would cause some service disruption, but would hardly constitute the "millions of dollars in damages" that city representatives feared.

Apparently, I wasn’t far off the mark. In response to one of by blog posts, a source with direct knowledge of the City of San Francisco’s IT infrastructure and of Childs himself offered to tell me everything he knew about the situation, under condition that he remain anonymous. I agreed, and within an hour, a long e-mail arrived in my in box, painting a very detailed picture of the events. Based on this information, the case of Terry Childs appears to be much more – and much less – than previously reported.

A man and his network

It seems that Terry Childs is a very intelligent man. According to my source, Childs holds a Cisco Certified Internetwork Expert certification, the highest level of certification offered by Cisco. He has worked in the city’s IT department for five years, and during that time has become simply indispensable.

Although Childs was not the head architect for the city’s FiberWAN network, he is the one -- and only one -- that built the network, and was tasked with handling most of the implementation, including the acquisition, configuration, and installation of all the routers and switches that comprise the network. According to my source's e-mail, his purview extended only to the network and had nothing to do with servers, databases, or applications:

“Terry's area of responsibility was purely network. As far as I know (which admittedly is not very far), he did not work on servers, except maybe VoIP servers, AAA servers, and similar things directly related to the administration of the network. My suspicion is that you are right about how he was 'monitoring e-mail'; it was probably via a sniffer, IPS, or possibly a spam-filtering/antivirus appliance. But that's just conjecture on my part.”

Like many network administrators who work in the rarified air of enterprise network architecture and administration, Childs apparently trusted no one but himself with the details of the network, including routing configuration and login information. Again, from the source's e-mail:

“The routing configuration of the FiberWAN is extremely complex. Probably more so than it ought to be; I sometimes got the feeling that, in order to maintain more centralized control over the routing structure, [Childs] bent some of the rules of MPLS networks and caused problems for himself in terms of maintaining the routing.

“Because the system was so complex (and also because he didn't involve any of the other network engineers in his unit), Terry was the only person who fully understood the FiberWAN configuration. Therefore, to prevent inadvertent disruption of this admittedly critical network, he locked everyone else out. I know most of the networking equipment … does use centralized AAA, but I get the impression he may have configured the FiberWAN equipment for local authentication only.”

Childs' attitude toward other administrators is by no means unusual in the IT industry. This is generally due to the fact that admins who are tasked with constructing and maintaining networks of this size and scope care for them like children, and eventually come to believe that no one else could have the knowledge and skills to touch the delicate configurations that form the heart of the network.

Sole administrator

A key point made in the e-mail is that Childs' managers and coworkers all knew that he was the only person with administrative access to the network. In fact, it was apparently known and accepted in many levels of the San Francisco IT department. Again, quoting from the e-mail:

“This is where it gets tricky for the prosecution, IMO, because the localized authentication, with Terry as sole administrator, has been in place for months, if not years. His coworkers knew it (my coworkers and I were told many times by Terry's coworkers, 'If your request has anything to do with the FiberWAN, it'll have to wait for Terry. He's the only one with access to those routers'). His managers knew it.

"Other network engineers for the other departments of the City knew it. And everyone more or less accepted it.

"No one wanted the thing to come crashing down because some other network admin put a static route in there and caused a black hole; on the other hand, some of us did ask ourselves, 'What if Terry gets hit by a truck?' If a configuration is known and accepted, is that 'tampering'?”

My source appears to believe that Childs' motivation was the antithesis of tampering, and that Childs did everything possible to maintain the integrity of the network, perhaps to a fault:

“He's very controlling of his networks -- especially the FiberWAN. In an MPLS setup, you have 'provider edge' (PE) routers and 'customer edge' (CE) routers. He controlled both PE and CE, even though our department was the customer; we were only allowed to connect our routers to his CE routers, so we had to extend our routing tables into his equipment and vice versa, rather than tunneling our routing through the MPLS system.”

Dedicated engineer

Like so many other high-level network administrators, Childs seems to have taken his job extremely seriously, to the point of arrogance and, perhaps, burnout.

“Terry was very dedicated to his career as an engineer. He is a CCIE (probably the only one in the City government), and spent much of his free time studying and learning more -- the MPLS for the FiberWAN, VoIP some of the departments are rolling out, other new technologies for our 311 and E911 systems, etc. He worked very hard, evenings and weekends in addition to full-time 8-5 work, and rarely took vacations. His classification is 'professional,' so he doesn't earn overtime pay, only comp time -- which like many of us he never really had the opportunity to use. He was on standby more or less 24-7-365; whereas in the private sector, in a company of 20,000 or more employees, you'd expect to find multiple engineers rotating that standby status, I'm pretty sure he was always the guy on call.”

This attitude is, again, not uncommon among high-level IT administrators. Neither is the fact that they tend to eschew what they perceive to be unnecessary questioning and bureaucratic “nonsense.”

“Terry also, obviously, had a terrible relationship with his superiors. I should point out that he's not just a network engineer -- he was the lead network engineer for the entire City. His bosses were all managerial rather than technical, and while the other engineers did not actually report to Terry, they did defer to him in any technical matters. Even the network architect left it to Terry to actually figure out implementation. Terry felt that his direct superior was intrusive, incompetent, and obstructive, and that the managers above him had no real idea of what was going on, and were more interested in office politics than in getting anything done.

"[Childs] complained that they spent more time doing paperwork -- change requests, documentation, etc. -- than actually implementing or fixing anything (a common complaint among engineers, I know). He complained about being overworked (which he was, and which his colleagues are even more now) and that many of his colleagues were incompetent freeloaders (also not entirely without basis).

"You could see him getting red in the face whenever he started talking about his department. And once you were on Terry's bad side (which thankfully I never was), that's where you stayed, and you'd get only the most grudging assistance from him from then on. Whether any of his complaints were valid or not, I can't really say, but I don't think that's as relevant as how Terry felt.”

Keys to the kingdom

If Childs' sole proprietorship of the FiberWAN network was normal operating procedure, how did the tensions between Childs and his managers come to a head? Why was Childs arrested on Sunday? There have been reports that the city’s newly hired head of security may have pushed for Childs to open the FiberWAN doors to other admins. My source doesn’t know for sure, but offers some insight:

“I don't know much about his actions in the last few weeks. It's been a couple of months, at least, since I've even spoken to him, and even then it was probably only in reference to some specific request or ticket. But I can imagine that being the subject of disciplinary action by his supervisors for 'performance' issues would be absolutely infuriating to him. I can imagine that his response would be, 'How can you say my performance is poor when I've been doing what no one else here was willing or able enough to do?'"

If Childs was pressured to give up the keys to the network that he had built and tended for so long, would he go so far as to explicitly prevent anyone else from tinkering with his charge?

“I can imagine that [Childs'] response to a demand to open up authentication to the FiberWAN would be, 'Why? So you can screw it up and bring the City network crashing to a halt?' I can even imagine that, under so much pressure, he'd take steps (deleting or hiding config backups, for instance) to make sure he was the only one in control.”

These tales offer significant insight into what may have occurred between Childs and the FiberWAN network hostage situation. Rather than a case of a rogue administrator attempting to cause damage to the network by locking out other administrators, this may be a case of an overprotective admin who believed he was protecting the network – and by extension, the city – from other administrators whom he considered inferior, and perhaps even dangerous. One important fact seems to be in Childs' favor, if reports that the network has continued to run smoothly since his arrest are true. My source corroborates this.

“As for the impact of [Childs'] actions to the rest of the City, the mayor's statement basically has it right. The network is completely up and running. No servers that I'm aware of are affected. No one has had any downtime (yet). But until they get back into those routers, they can't make any changes. I don't know yet if Terry's lockout applies only to the FiberWAN or also to the other routers, firewalls, switches, etc. in the City network.”

Laying the blame

My source doesn’t appear to harbor any ill will toward Childs for this situation, and even believes that the city may be worse off with Childs out of the picture and that some of the blame should be shouldered by Childs' superiors.

“It's a real shame. The city is losing a good network engineer -- probably the best, technically, that they've ever had. Ultimately he has no one to blame but himself, but it's too bad his superiors weren't better about establishing and enforcing policies about authentication, backups, auditing, cross-training, and separation/rotation of duties.

"You'll note the papers have referred to the new information security manager. It's only been a month or so since the City even had an information security policy, and even that is a bare, unmodified template from CCISDA that's awaiting discussion and alteration by a committee that hasn't been formed yet. (When I asked Terry if we could get a copy of the City's network security policy some months ago, he told me, 'I've been trying to get them to approve one for years. I've written ones up and submitted them, but they don't want to do it, because they don't want to be held to it.')”

He also points out that by forcing the issue, the city may have significantly reduced its ability to use and control its own network.

“The one impact they haven't mentioned is that Terry was one of only two engineers assigned to special projects and to do major routing changes and perimeter firewall configuration. The service level, even after they regain control of the network, is going to be way down, until they can fill his mighty big shoes.”

My source had many good things to say about Childs, but did not shy from negative comments, noting that Childs has a bad temper and can be very defensive.

“As for Terry's character, I can imagine this happening. He takes great personal and professional pride in his work -- to a fault. He can be very defensive if someone suggests there's something wrong with the way his network is set up, and that's been a problem for us (as his customer) a couple of times. Terry has a bad temper.

"He's the sort of person who, while his bile is up, won't budge an inch – and then will call you a couple of hours later and acknowledge that maybe your suggestion was right, after all, or maybe here's an even better way to handle things.”

The inner sanctum

Later in the e-mail, my source offered some insight into what may be at the core of the issue: Childs was so paranoid about the security of the network that he even refused to write router and switch configs to flash, which would mean that if the device was powered off, all configurations would be lost.

“At one point he was concerned about the security of the FiberWAN routers in remote offices, so he had them set up without saving the config to flash. 'If they go down, I'll get alerted, and connect up to them and reload the config.' Great, except we have power outages all the time in this city, some of those devices aren't on UPSes, and what happens if you're on vacation? And what about the 15 to 60 minutes it might take you to connect up and reload? He eventually conceded and (ahem) decided that disabling password recovery was sufficient security.”

If Childs did this with some or all of the switches and routers comprising the FiberWAN network, then password recovery without significant network disruption becomes a bigger problem. Without firsthand knowledge of the state of those routers and switches, there’s no good way to know, unfortunately.

If the details given to me in this e-mail are accurate, it would appear that this case is not nearly what it seemed originally. Perhaps it comes with the pressure and responsibility of the job, or the belief that the network they’ve built is simply too complex for mere mortals to comprehend, but it’s not uncommon for highly skilled network administrators to become overprotective of their networks, or for networks of significant size to become an extension of the person who built them.

It certainly appears that Terry Childs believed San Francisco’s FiberWAN network was his baby, and that by refusing to allow others to access the inner sanctum was in the best interests of the city, the citizens, and perhaps most importantly, himself.
http://www.infoworld.com/article/08/...lockout_1.html





Autistic Hacker's Talents to be Used for Good

A teenage hacker who admitted to what the FBI call "an incredibly serious crime" could end up on the right side of the law, helping police target other hacking masterminds.

Owen Thor Walker, 18, of Whitianga, appeared for sentencing at the High Court at Hamilton yesterday after earlier admitting six cyber crime charges.

Justice Judith Potter discharged him without conviction.

Crown lawyer Ross Douch and defence lawyer Tony Balme told the court that New Zealand police were interested in using Walker's skills.

Police had yet to offer him a job, but Walker said he would be keen to take them up on the offer if they did.

Walker has also been approached by overseas companies keen to employ him.

US Special agent Rich Kolko said yesterday from Washington that the FBI considered it "an incredibly serious crime" and others nabbed in Operation Bot Roast had received a range of convictions.

"It depends on the crime and how much leeway the judge has," Kolko said.

"There's certainly conditions where people's co-operation and assistance can vary what type of sentences people receive.

"As far as a sentence, in an individual country under their individual law, that's up to them ... some get probation, some go to jail for a long time we can't throw them all in one category because they have varying levels of participation."

Walker was allegedly the mastermind of a "botnet" coding group said to have infected a million computers and caused millions of dollars of damage.

According to police Walker, known online as "Akill", received just under $40,000 for his part in the attacks, which included a global adware scheme and the collapse of a computer server at an American university.

As Justice Potter spared Walker a conviction, he allowed himself a smile and his mother Shell Whyte buried her head in her hands in relief.

Walker was remorseful and said he now realised what he had done was wrong. He felt "great" about the sentence.

Walker was diagnosed with Asberger's syndrome, a mild form of autism often characterised by social isolation, when he was 10.

Justice Potter took into account mitigating factors of his youth, early guilty plea, co-operation with police, his Asberger's syndrome, willingness to pay reparation, good character, his family's efforts to develop his social skills and the lack of criminal intent.

The offending started in January 30, 2006, when Walker was 16 and lasted until November 28 last year.

Justice Potter ordered Walker to pay $9526 as his half share of the damage caused to the university computer and other costs of $5000.

She also ordered him to hand over his computer-related assets to police.
http://www.stuff.co.nz/4619629a10.html





The BSA Singles Out Eight States in Software Piracy Report, Suggests Public Safety Link
Jordan Golson

The software industry's main lobbying group, the Business Software Alliance, would like you to know that piracy is a big problem.

The BSA has just released its 2007 State Piracy Study, which found that one in five pieces of software in use in the United States was unlicensed. That's 20 percent!

California, Illinois, Nevada and Ohio all had piracy rates over the national average -- except the study was only conducted in eight states, so we aren't sure if Nebraska is a hotbed of software piracy or not.

The BSA notes that the piracy cost software vendors $4.2 billion -- "higher than the national figure for all other countries in the world except China." (Emphasis theirs)

The BSA also says that the lost state and local tax revenue from piracy would have been enough to "hire nearly 25,000 experienced police officers." Who knew that if I had just paid for that copy of Microsoft Office in college, that there would be more cops walking the beat?

"The United States may have the lowest PC software piracy rate in the world, but still..."

This is an outrage! I, for one, think we should stop prosecuting all drug activity and focus on the scourge of society that is pirated software.

Seriously. Piracy is bad, but I think it's a bit disingenuous to claim that "oh, if only people paid for their software, then little Timmy would have a new middle school to go to."

The BSA finishes its press release by informing consumers of its "Know it, Report it, Reward it" program, which offers cash rewards for turning in pirates. Call 1-888-NO-PIRACY to report any software piracy at your employer. "The majority of BSA's leads come from current or former employees who have information relating to the unlicensed software activity." It's just like on the subway: "If you see something, say something" -- only this isn't terrorism, it's software piracy -- but that's pretty much the same thing, isn't it?
http://www.thestandard.com/news/2008...ant-problem-us





Look for the Silver Lining

Piracy is a bad thing. But sometimes companies can turn it to their advantage
The Economist

“MERCHANT and pirate were for a long period one and the same person,” wrote Friedrich Nietzsche. “Even today mercantile morality is really nothing but a refinement of piratical morality.” Companies, of course, would strongly disagree with this suggestion. Piracy is generally bad for business. It can undermine sales of legitimate products, deprive a company of its valuable intellectual property and tarnish its brand. Commercial piracy may not be as horrific as the seaborne version off the Horn of Africa. But stealing other people’s R&D, artistic endeavour or even journalism is still theft.

That principle is worth defending. Yet companies have to deal with the real world—and, despite the best efforts of recorded-music companies, luxury-goods firms and software-industry associations, piracy has proved very hard to stop. Given that a certain amount of stealing is going to happen anyway, some companies are turning it to their advantage.

For example, around 20 times as many music tracks are exchanged over the internet on “peer to peer” file-sharing networks as are legitimately sold online or in shops. Statistics about the traffic on file-sharing networks can be useful. They can reveal, for example, the countries where a new singer is most popular, even before his album has been released there. Having initially been reluctant to be seen exploiting this information, record companies are now making use of it. This month BigChampagne, the main music-data analyser, is extending its monitoring service to pirated video, too. Knowing which TV programmes are being most widely passed around online can help broadcasters when negotiating with advertisers or planning schedules.

In other industries, piracy can help to open up new markets. Take software, for instance. Microsoft’s Windows operating system is used on 90% of PCs in China, but most copies are pirated. Officially, the software giant has taken a firm line against piracy. But unofficially, it admits that tolerating piracy of its products has given it huge market share and will boost revenues in the long term, because users stick with Microsoft’s products when they go legit. Clamping down too hard on pirates may also encourage people to switch to free, open-source alternatives. “It’s easier for our software to compete with Linux when there’s piracy than when there’s not,” Microsoft’s chairman, Bill Gates, told Fortune magazine last year.

Another example, from agriculture, shows how piracy can literally seed a new market. Farmers in Brazil wanted to use genetically modified (GM) soyabean seeds that had been engineered by Monsanto to be herbicide-tolerant. The government, under pressure from green groups opposed to GM technology, held back. Unable to obtain the GM seeds legitimately, the farmers turned to pirated versions, many of them “Maradona” seeds brought in from Argentina. Eventually the pirated seeds accounted for over a third of Brazil’s soyabean plantings, and in 2005 the government relented and granted approval for the use of GM seeds. Monsanto could then start selling its seeds legitimately in Brazil.

Innovators ahoy

Piracy can also be a source of innovation, if someone takes a product and then modifies it in a popular way. In music unofficial remixes can boost sales of the original work. And in a recent book, “The Pirate’s Dilemma”, Matt Mason gives the example of Nigo, a Japanese designer who took Air Force 1 trainers made by Nike, removed the famous “swoosh” logo, applied his own designs and then sold the resulting shoes in limited editions at $300 a pair under his own label, A Bathing Ape. Instead of suing Nigo, Nike realised that he had spotted a gap in the market. It took a stake in his firm and also launched its own premium “remixes” of its trainers. Mr Mason argues that “the best way to profit from pirates is to copy them.”

That this silver lining exists should not obscure the cloud. Most of the time, companies will decide to combat piracy of their products by sending in the lawyers with all guns blazing. And most of the time that is the right thing to do. But before they rush into action companies should check to see if there is a way for them to turn piracy to their advantage.
http://www.economist.com/opinion/dis...ry_id=11750492


















Until next week,

- js.



















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