Music sales continue to rise – who knew?
Record Sales Break Records In UK
BBC
Up 3%
A record number of albums were sold in the UK in the last year because they are now cheaper than ever, industry figures have revealed.
More than 228 million albums were sold in the 12 months from June 2002 - up 3% on the previous year - according to the British Phonographic Industry (BPI). And they were on sale for an average of £9.79 each, which is a new low, the BPI said. But despite the healthiest album sales recorded, music industry profits are down.
The BPI said the total UK music market for the first six months of 2003 was down 7% in sales values, compared with last year. Artists such as Robbie Williams, whose Escapology album has sold 1.8 million in the UK since its November release, have dominated the album charts in recent months. Other album successes have come from Norah Jones, with sales of 1.5 million, and Avril Lavigne and Justin Timberlake, with 1.2 million each.
ALBUM SALES
12 Months from June ‘02: 228 million
Five years ago (1998): 210 million
Ten years ago (1993): 153 million
Twenty-five years ago (1978): 107 million
CD prices have dropped as record shops have been forced to compete with supermarkets and websites, which are able to sell them for less. Tesco recently said it had overtaken Virgin to become the UK's third-largest music retailer. "It is clear that cheap retail prices on offer to the consumer, combined with strong new release titles, are sustaining the UK album market at a high level," a BPI statement said.
http://news.bbc.co.uk/1/hi/entertain...ic/3158767.stm
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Australian Music Sales Rise
Kate Mackenzie and wires
MUSIC DVD sales have led Australia to buck a global fall in music sales around the world in the first half of the year.
The International Federation of the Phonographic Industry blamed piracy and illegal MP3 downloads from the internet for a 10.9 per cent decline in recorded music sales worldwide.
Sales of all audio and music video formats were worth $US12.7 billion ($19.9 million) in the first six months of the year, compared with $US14.3 billion in the same period of 2002, the International Federation of the Phonographic Industry said in its interim report.
IFPI Germany, Japan, the United States and Canada have been particularly hard hit by piracy, seeing the numbers of unauthorised downloads of tracks and copied CDs reach or exceed the levels of legitimate track and CD album sales.
Australia's total music sales growth was attributed to rising music DVD sales. Several other countries, including Russia, Finland and Hong Kong also saw net rises for various reasons.
Australia also falls outside the top 10 countries IFPI has listed as their main piracy concerns. Brazil, China, Mexico, Paraguay, Poland, Russia, Spain, Taiwan, Thailand and the Ukraine are on the list.
DVD music videos, which grew by 46 per cent by volumes and 55 per cent by value in the first half, took a 5 per cent shares of global music sales.
"Despite some healthy signs that a legitimate online music business is now taking hold, the music industry continues to suffer from the unauthorised file-sharing and commercial piracy," said the federation's chairman, Jay Berman.
"We are responding to this decisively, however: on the physical piracy front, seizures of discs rose four-fold last year; on the Internet piracy front, the US industry is leading a highly effective global public awareness drive on the legal risks of file-sharing; and on the new business front, a marked change in the landscape is visible as a number of legitimate online music sites take hold."
The format has proved a big hit with movie watchers and the music industry is hoping to cash in on its popularity to boost flagging revenues.
At the same time the music giants are battling to win a share of the online music market, having initially opposed all forms of online music downloads.
There was a marked increase in the availability of legitimate online music in the first half of this year, with 300,000 tracks now on offer online, the report said.
Europe now has more than 30 sites offering legitimate online music either by pay-per- download or subscription, it said.
The London-based federation comprises a membership of more than 1,500 record companies, including independents and majors, in over 70 countries.
http://australianit.news.com.au/comm...=date&Intro=No
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Global Music Sales Continue To Fall
Owen Gibson
Things are going to get worse before they improve for a music industry brought to its knees by music piracy and file sharing, a report released today claims.
For the major record labels, which are cutting costs and engaged in a game of brinkmanship over a series of proposed mergers, the predictions will come as gloomy tidings ahead of the Christmas sales season.
The Informa Media research predicts the value of global music sales will drop for the fourth year in a row to £16.5bn this year and will fall even further next year.
The total number of CD sales, which fell for the first time in 2001, will continue to slide, dropping by 8% to 2.1 billion units in 2003.
Online peer-to-peer piracy, counterfeit CDs, the end of the CD boom - when music fans updated their vinyl collections - and the rise of competing leisure products such as video games, mobile phones and DVDs have all been blamed for the industry's current crisis.
However, the Informa analysis predicts a recovery will be under way by 2005 provided record labels can get to grips with piracy and support legal digital download services.
"The music industry is in a bad way at the moment but the continued fall in the value of music sales is certainly not irreversible," said Simon Dyson, the author of the report.
"The success of the new download services proves there is a viable market for legitimate digital sales, but the music companies must act decisively to stop the growth of illegal services and the widespread copying of CDs," he added.
The world's four biggest music companies are engaged in an unprecedented wave of consolidation, with EMI courting a long-awaited merger with Time Warner's music arm and Bertelsmann-owned BMG announcing a joint venture with Sony.
Although EMI and Warner have been discussing the proposed tie-up for months, BMG and Sony have sought to leapfrog their rivals by submitting their plans to competition regulators ahead of the EMI/Warner camp.
Only one of the two deals is expected to be allowed.
To further complicate the situation the former Seagram chief executive, Edgar Bronfman, is expected to make a solo £1.5bn bid today for Time Warner's music assets.
He has teamed up with a range of other investors, including the Power Rangers entrepreneur, Haim Saban.
Since Apple's launch of iTunes - the only legal download service to have a wide roster of songs from all the major labels at a reasonable price - software companies and music labels have been falling over themselves to launch their own versions.
US software group Roxio bought the rights to the famous Napster brand and recently relaunched it as a legal site, while Real Networks, Microsoft, AOL and Yahoo! have all either launched digital music services or have well-advanced plans to do so.
http://media.guardian.co.uk/newmedia...088783,00.html
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Music Industry Recovery on Pause Until 2005 – Study
Reuters
The music industry is in for at least two more years of pain, with a sales recovery not expected until 2005 at the earliest, a report said on Tuesday.
According to London-based research firm Informa Media Group, the retail value of global music sales will drop to $28.2 billion this year from $30.9 billion in 2002 and to $28 billion in 2004 before returning to growth in 2005 as new Internet music services take off.
"The music industry is in a bad way at the moment but the continued fall in the value of music sales is certainly not irreversible. The success of the new download services proves there is a viable market for legitimate digital sales," said Simon Dyson, an Informa analyst.
Dyson said the major music labels Universal Music, Sony Music, Warner Music, EMI and Bertelsmann's BMG have not acted decisively enough to stem the rise of digital piracy, which is blamed for sinking sales for three straight years.
A host of industry-backed subscription download services have emerged to address the practice of consumers making copies of their CDs and downloading songs from the Internet for free, but consumer uptake has been slow.
One rare early success, the Apple Computer Inc. iTunes service, shows consumers are willing to buy individual songs online, but Dyson warned digital music sales will always be a niche sector, accounting for a low double-digit share of overall sales.
Informa predicted global Internet music sales, which includes sales of CDs from retail Web sites such as Amazon.com and song downloads for iTunes, will reach 3.9 billion by 2008, up from $1.1 billion in 2002.
http://story.news.yahoo.com/news?tmp...media_music_dc
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It's Certainly A Thrill: 'Sgt. Pepper' Is Best Album
Edna Gundersen
To everyone's complete lack of surprise, Sgt. Pepper's Lonely Hearts Club Band has been anointed the best album ever in a new Rolling Stone poll. (Related item: See statistics from their list)
The Beatles' consecrated 1967 classic tops "The 500 Greatest Albums of All Time," a collector's issue on stands Friday. Though typically the odds-on favorite for such rankings, Sgt. Pepper wasn't a slam-dunk.
"There was a horse race," says Rolling Stone music editor Joe Levy. "Early on, any number of albums in the top 10 were in the lead. The final result is no shock, but there's a reason for that. The Beatles, after all, were the most important and innovative rock group in the world. And Sgt. Pepper arguably set the tone for what an album could be."
The Beatles have four albums in the top 10. Predictably, the list is weighted toward testosterone-fueled vintage rock.
The top solo female is Joni Mitchell, whose 1971 Blue is No. 30.
The newest entry is this year's Elephant by the White Stripes, landing at No. 390. The most current disc in the top 20 is Nirvana's 1991 breakthrough, Nevermind. Recent albums by Coldplay and The Strokes also made the cut, as did all three Eminem (news - web sites) releases and a wide range of hip- hop.
http://story.news.yahoo.com/news?tmp...today/11955063
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Australians Escape Jail In Country's First Online Music Piracy Case
SYDNEY, (AFP) - Two Australian men who ran a music website from their parents' homes escaped jail Tuesday in what the recording industry described as the country's first criminal prosecution for online music piracy.
Charles Kok Hau Ng, 20, and Peter Tran, 19, pleaded guilty to copyright breaches which prosecutors estimated cost the Australian music industry 60 million dollars (43.2 million US).
The pair were in charge of the "MPW3/WMA Land" site, which attracted seven million hits in 12 months, allowing users to download 1,800 copyrighted tracks free of charge.
Ng, Tran and a third man, Tommy Le, 21, were arrested in April after police raided their homes following a joint investigation with Music Industry Piracy Investigations (MIPI), a record industry-funded watchdog.
The trio had faced up to five years' jail and 60,500 dollars (43,560 US) in fines.
Magistrate Graeme Henson said Ng and Tran's offences warranted a jail term because the men knew they were acting illegally and went to great lengths to cover their tracks.
But he gave them 18-month suspended sentences because of their youth and the fact that they never made a profit from the site. Tran was also ordered to pay a 5,000 dollar fine, while Le and Ng were given 200 hours community service.
MIPI manager Michael Speck described the court's decision as "a slap on the wrist".
"It's most disappointing," he told AFP. "Australia had the opportunity to show the world how seriously it was taking this type of crime.
"Instead, the court has allowed them to walk away after saying that they deserved to go to jail -- it's virtually an invitation for Internet pirates to set themselves up in Australia."
When the trio were first charged, MIPI said the case was the first criminal prosecution of its type in the world.
Speck said since then a number of other prosecutions had now been completed overseas, resulting in jail terms of at least 12 months from those involved in Internet piracy on such a scale.
Attorney-General Philip Ruddock said the case showed convictions could be secured under government legislation to crackdown on copyright pirates.
"A conviction resulted and penalties have now been imposed so that would suggest to me that the law is working as intended," he told public radio.
http://story.news.yahoo.com/news?tmp...y_031118072229
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New Zealand DIA Investigates 111 P2P Users, Prosecutes Two
Wider eye may pose problems for work environments
Stephen Bell
A Computerworld Official Information Act (OIA) request shows only two prosecutions have resulted from Department of Internal Affairs investigations into more than 100 peer-to-peer users.
Department censorship inspectors have turned their attention earnestly to peer-to-peer trading channels, but to date seem to be having little success.
The OIA request earlier this month showed that while 111 users of P2P services have been “investigated”, there have only been two prosecutions, with another five cases are being readied for court.
The department does not specify to what degree of “investigation” the unsuccessful cases proceeded.
Department attention to P2P channels, such as Morpheus and Kazaa, could signal to IT managers a need to be more assiduous in policing what their employees do at work. IRC channels, a longer-established porn trading medium, are sectioned by subject, and inspectors concentrate on those where illegal material is traded.
While an employee is unlikely to blatantly join a channel with an explicit title from their work machine, P2P services, by contrast, are more general with legal and illegal porn mixed in with mainstream pictures and audio and video files.
Employees committing a mere misdemeanour, such as seeking tracks from the latest Dido album or a Lord of the Rings trailer, may find a department porn inspector looking over their shoulder.
Trading of pirated music and video tracks is regarded as a serious matter by the film and music industries, which have begun to threaten ISPs with legal action.
The two successful P2P prosecutions to date are for trading, not merely possessing, objectionable material. Computerworld asked the department whether the cases had brought any delicate legal argument, since “supply” of a file on P2P services is typically automatic on the consumer’s (or inspector’s) clicking on the file icon. Most IRC trades, by contrast, have been the result of an online conversation where the owner of the file is specifically requested to send it and has to take a physical action to do so.
Department censorship compliance head Keith Manch says that there has been no legal argument to date on P2P files, as both offenders pleaded guilty. Only one of the offences, however, is under the section “involving knowledge”, suggesting that the other trader may have been unaware that the image “supplied” was illegal.
http://www.computerworld.co.nz/news....4?OpenDocument
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Quantum MP3 May Soon Be Reality
Mike Martin
"Our approach to quantum audio signals has close similarities with the MP3 compression used for sound treatment in usual classical computers," says French researcher Dima Shepelyansky.
"Good afternoon, gentlemen. I am a HAL 9000 computer. I became operational at the H.A.L. lab in Urbana, Illinois, on the 12th of January."
When the intrepid astronauts of Arthur C. Clarke's "2001: A Space Odyssey" heard those ominous words from their future nemesis, they could have been hearing the voice of a quantum computer, though Clarke and director Stanley Kubrick might not have envisioned such technology at the time.
Just how a quantum computer could speak and make sounds is the subject of a new paper by three French researchers who claim that "classical audio analysis methods cannot be directly applied to quantum signals, and it is important to adapt them to the new environment of quantum computing."
In what might be a first study of quantum-computer audio transmission, "our results show that sound signals stored in a quantum memory can be reliably recognized and recovered on realistic quantum computers," explained Jae Won Lee of the French Center of National Scientific Research.
Lee and colleagues Dima Shepelyansky and Alexei Chepelianskii used HAL's famous first words to prove their point.
A Thousand Years of Sound
Conventional information processing uses binary bits that are either zero or one.
Computer scientists want to use subatomic particles -- which can be in more than one state at one time, a quirky quantum property -- to create a new type of bit that can be both zero and one -- at once.
This quantum bit, or "qubit," can move information and process sound far faster than its conventional binary-bit counterpart.
"A quantum computer with 50 qubits may store an amount of information exceeding all modern supercomputer capacities (1,000 years of sound)," writes Shepelyansky, director of research at the French Center.
Shepelyansky and his collaborators found that HAL's voice "could be encoded in the wave function of a quantum computer" with 18 qubits. "A quantum wave function is 'written' in the memory of a quantum register formed by qubits," he told NewsFactor.
HAL Now?
MP3 is a well known example of audio compression that uses a mathematical technique called the "Fast Fourier Transform" for rapid access to the audio-signal spectrum. Sound signals have to be reduced or "compressed, in order to achieve real-time audio communication," Chepelianskii told NewsFactor.
MP3's quantum counterpart -- the Quantum Fourier Transform -- allows far faster audio transmission.
"Our approach to quantum audio signals has close similarities with the MP3 compression used for sound treatment in usual classical computers," Shepelyansky explained. "Measurements of qubits are performed on the quantum register that allow us to extract the stored sound signal. We performed numerical simulations of this process and developed an optimal strategy to restore the original sound."
http://sci.newsfactor.com/perl/story/22456.html
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Q U O T E D
I'm figuring out a meditation wall for my apartment in New York. Eight feet high by 12 feet wide, with an array of overlapping rear projectors, each with a tiny Linux box and connected by gigabit Ethernet. I would love to get 72 dpi but will probably settle for less - about 30 megapixels for the whole thing. [Former Walt Disney Imagineering guru] Bran Ferren and Danny Hillis [inventor of massively parallel supercomputing] at Applied Minds are building it for me. It's very bright. Given that it's in an apartment, the main limitation will be power availability. I'll also need some great 30-megapixel images. Any ideas? I can always put a picture of stars on the wall. In Manhattan, you can't see them - except, of course, in a blackout.
- - Bill Joy, co-founder and former chief scientist at Sun Microsystems, explains what he's doing for fun these days.
http://www.siliconvalley.com/mld/sil...sv/7319476.htm
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Rights Advocates Urge Patriot Act Amendments
Caron Carlson
Two years after granting the FBI (news - web sites) a series of new electronic surveillance and search powers to combat terrorism, Congress is taking a closer look at the impact of those powers and of other provisions in the USA Patriot Act. What makes the matter particular pressing for politicians is that the act's critics span the entire political spectrum.
It comes as no surprise that the American Civil Liberties Union (news - web sites) would be wary of expanded police powers, but the issue became more complicated when former congressman Bob Barr, known for his conservative leaning, joined the ACLU's cause.
According to Barr, who voted for the USA Patriot Act, the government's response to the Sept. 11 terrorist attacks has had an adverse affect on individual liberties.
"Little did I, or many of my colleagues, know [the Act] would shortly be used in contexts other than terrorism, and in conjunction with a wide array of other, privacy-invasive programs and activities," Barr told lawmakers Tuesday in testimony to the Senate Judiciary Committee (news - web sites).
Two provisions that expand the government's power to obtain personal records without the traditional checks and balances surrounding search warrants and subpoenas are particularly troubling to rights advocates. One provision (Section 215) allows the FBI to demand business records, such as a subject's medical history, Internet use patterns and gun purchases, with an order from the Foreign Intelligence Surveillance Court, even if the subject is not a suspected terrorist. Critics say the order amounts to a rubber stamp.
Another provision (Section 505) gives the government greater power to use what is known as a "national security letter"—also known as an administrative subpoena—to obtain records such as credit reports, financial documents, and telephone and email bills. A national security letter does not require law enforcement to show probable cause, nor does it require even the low standard of judicial review required by a FISA Court order.
The Department of Justice (news - web sites), trying to assuage the concerns, recently announced that Section 215 has not been used to obtain business records. However, that announcement served to underscore one of the broader concerns about the Patriot Act, which is that lawmakers enacted broad new powers without determining if the powers were necessary.
James Dempsey, executive director of the Center for Democracy and Technology in Washington, told Congress today that the Justice Department (news - web sites)'s concession that Section 215 has not been used illustrates the need to repeal or amend it.
Proponents of the Patriot Act charge that critics have overblown the breadth of the new surveillance powers. Viet Dinh, a former Justice Department attorney who was instrumental in crafting the Act, told Congress that fears over Section 215 are unfounded. Dinh, who now is a law professor at the Georgetown University Law Center, said that the section gives courts the same power to order the production of business records that grand juries have long had.
The ACLU and CDT are urging Congress to pass a bill called the SAFE (Security and Freedom Ensured) Act to render the FISA court order more than a rubber stamp. Before law enforcement agents could get a FISA Court order to obtain personal records from banks, universities, doctors, travel agents and employers, they would have to show a reason for suspecting that the records relate to a spy, terrorist or other foreign agent. Under the legislation, additional search and Internet monitoring provisions would expire at the end of 2005.
Rights advocates have achieved considerable success in raising awareness on Capitol Hill about the concerns regarding executive branch data-mining projects, but they urged lawmakers today to remain vigilant. Congress has blocked funding for the controversial Operation TIPS and Total Information Awareness programs, but critics say these programs are re-emerging under different guises. The MATRIX (Multi-state Anti-Terrorism Information Exchange) program, for example, could be TIA by another name, Barr cautioned.
http://story.news.yahoo.com/news?tmp...8/tc_zd/112802
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AT&T Wireless Jumps Into Data Arms Race With Speedier Service
Bruce Meyerson
AT&T Wireless (news - web sites) weighed into the mobile Internet arms race on Tuesday with a national upgrade to its mobile data network that will enable laptop connections at twice the speed of dial-up access.
Gearing up for the industry slugfest expected to break out next week, when cellphone users can begin switching wireless carriers without giving up their phone numbers, AT&T Wireless boasted Tuesday that it now offers the fastest national data service. That claim is essentially true, though only by a small margin.
Either way, compared with the data service AT&T Wireless is replacing, the $300-million upgrade to Edge technology brings a major improvement to the company's lineup at a crucial time.
Cell companies have been hurrying out new products and promotions in a bid to attract new customers and retain old ones once new rules take effect Monday freeing them to switch services without losing their phone numbers.
Sprint, for example, rolled out a new "walkie-talkie" feature and aggressive pricing. T-Mobile has expanded its free weekend calls to include all of Friday.
The new $79.99 US per month unlimited service is billed with average data speeds of between 100 and 130 kilobits per second for a laptop equipped with a wireless modem card that costs $250. Under optimal conditions, such as off-peak usage times and close proximity to a network transmitter, the maximum speed is 200 kbps.
By contrast, the "1xRTT" technology used by arch rivals Sprint and Verizon Wireless are billed as providing average speeds between 50 and 70 kbps, with bursts of up to 144 kbps.
The announcement by AT&T Wireless goes right to the heart of a Sprint ad campaign that directly attacks AT&T Wireless as offering inferior data speeds of only 20 to 40 kbps with the GPRS technology it has been using.
"We are now twice as fast as (Sprint and Verizon), and we offer the service at the same price they offer for their services," said Andre Dahan, president of AT&T Wireless Mobile Multimedia Services, adding that his company won't be shy in its marketing efforts. "Most big publications (Wednesday) will have ads, and yes, we are naming names."
None of these cellular-based data services compare with the speed of a wireless data connection using the popular Wi-Fi technology. But they provide coverage over a much wider area than Wi-Fi, whose current range is limited to about 300 feet.
In September, Verizon launched an even faster generation of wireless Internet access in two cities, Washington and San Diego, promising average speeds of between 300 and 500 kbps, almost on par with the wired broadband connections provided by DSL and cable TV, and bursts of up to 2,000 kbps.
However, Verizon has no immediate plans to roll out that service nationally.
http://story.news.yahoo.com/news?tmp...speed_wireless
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Searching For Harmony
Laura Rohde
AOL launches audio- and video-finding features
Hoping to attract broadband customers to its service, AOL today began offering a new audio and video search feature that promises to simplify searches for multimedia content across the web as well as through AOL's exclusive media content.
The company, a subsidiary of Time Warner, has also acquired Singingfish, which provides the technology for the multimedia searches. Representatives of AOL and Singingfish could not immediately be reached for comment.
Singingfish's search engine technology is already included in media players by companies such as Microsoft and RealNetworks. Peer-to-peer (P2P) file- sharing programs like Kazaa and Morpheus also allow audio and video searches, though the services are often accused of violating copyrights. Singingfish claims it only searches for content that is authorised for use.
Along with the audio and video search, AOL is also offering a preview version of a neighbourhood search technology called "In Your Area," which includes local yellow-page listings and movie showing times. The company did not say when the full version of the search tool would be made available, or detail the limitations of the preview version.
New navigation tabs for audio and video searches as well as the In Your Area searches have been included on the integrated AOL Search service.
AOL has been aggressive in its efforts to compete in the growing online search market. Last month, the company added new query options and navigation tools to its service and expanded its agreement with search engine Google to include access to Google's index and sponsored links.
http://www.pcadvisor.co.uk/index.cfm...view&news=3665
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Kazaa Launches Legitimacy Campaign
David McGuire
The world's largest Internet music-trading service launched a $1 million advertising campaign Tuesday designed to rally the public to pressure lawmakers and the entertainment industry to embrace digital file sharing as a legitimate distribution tool.
The campaign is the latest push by the Kazaa file-sharing service and its parent company, Sharman Networks, to counter a multi-million-dollar legal and lobbying effort launched by music, software and movie firms convinced that peer-to-peer (P2P) services are a major source of online piracy.
The ads invite readers and Kazaa's estimated 60 million users to "join the revolution" by proclaiming their love of Kazaa to "politicians, journalists, record labels, movie companies and friends." They also exhort the entertainment industry to embrace the "revolution" or get left behind as technology passes them by.
Sharman Networks's Nikki Hemming said that the campaign will feature three ads scheduled to run in several widely read newspapers and magazines including Rolling Stone, the Wall Street Journal, the Los Angeles Times, the Sydney Morning Herald and London's Guardian.
The campaign follows Sharman Networks's backing earlier this year of the Distributed Computing Industry Association, a group formed to lobby Congress on the merits of file sharing. It also is the latest step by Kazaa to cast itself as the way that the music industry should sell its products online.
"I think we're in the last mile right now," Hemming said.
Entertainment industry officials were unimpressed with Hemmings's attempts to redefine Kazaa.
Motion Picture Association of America (MPAA) spokesman Rich Taylor dismissed the campaign outright. "Kazaa is a service that is preying on copyrighted works, and no amount of advertising can change what you see when you go online there," he said. The MPAA estimates that file sharing has cost the film industry more than $1 billion in the last year.
Until the file-sharing companies filter copyrighted works, there won't be much ground for discussion, said Recording Industry Association of America spokesman Jonathan Lamy.
Gigi Sohn, president of Washington, D.C.-based civil liberties group Public Knowledge, said it will be hard to rally millions of people to support something that they know in their hearts is illegal.
"Whenever I talk to people about Kazaa, they treat it like marijuana -- as much as they love it, they have a sense that what they're doing is a little bit wrong," Sohn said.
But Hollywood and the recording industry deserve their share of the blame for the ongoing problem, she said, because they seem unwilling to understand why millions of people use file sharing as their only way to get music, legally or otherwise.
"There's something about peer-to-peer that people like, and it's not just that it's free," Sohn said. "It's that they're involved in a community of people. I don't know why [entertainment companies] wouldn't want to appeal to an instant audience of tens of millions."
Sharman Networks is the primary backer of the Distributed Computing Industry Association (DCIA) which starting in July tried to break that stalemate. The group has gotten the ear of several prominent file-sharing critics, including Senate Judiciary Chairman Orrin Hatch (R-Utah), but there are no signs that it has been able to change entrenched industry perceptions.
If anything, the DCIA has caused trouble for Kazaa because it is butting heads with P2P United, a rival lobbying group formed by several of Kazaa's competitors, including Grokster, Morpheus and BearShare.
These other networks have responded bitterly to Sharman Networks's decision to pursue its goals without them, especially because Kazaa with its 60 million users brings more clout to the debate.
Wayne Rosso, chief executive of OptiSoft SL, the Spanish company that owns the Blubster and Piolet P2P networks, said that Kazaa refuses to band together with its competitors because it foresees a future in which it outlasts them and becomes the music industry's primary online music distribution method.
"They think they're Microsoft," said Rosso, the former head of the West Indies-based Grokster. "It's just a shame that we're in a business where the industry's dominant player demonstrates the same kind of arrogance and hubris the record industry displays."
Sohn of Public Knowledge said that the file-sharing industry -- in-fighting aside -- has performed poorly in trying to get policymakers to understand their position. "They need to learn a little better how things work, particularly how they work in this town," she said. "It's a far cry from using Kazaa to marching on the steps of the Capitol."
http://www.washingtonpost.com/wp-dyn...2003Nov19.html
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Judge Rules In Favor Of Pop-Up Purveyor
Stefanie Olsen
A federal court judge dismissed Wells Fargo's motion to block a software maker that launches rival pop-up advertisements when customers access the bank's Web site.
Judge Nancy Edmunds of the U.S. District Court of Michigan's Southern Division on Wednesday denied Wells Fargo's motion for a preliminary injunction against WhenU, a distributor of free advertising software, that was aimed at disarming the pop-up purveyor. The judge also issued a memorandum opinion on the case.
Wells Fargo and plaintiff Quicken Loans charged that WhenU violated their copyrights and trademarks by delivering ads for rival Web sites to consumers while they were visiting their own sites.
"The fact that some WhenU advertisements appear on a computer screen at the same time (the) plaintiffs' Web pages are visible in a separate window does not constitute a use in commerce of the plaintiffs' marks," Judge Edmunds wrote as one of the arguments against an injunction.
While only a preliminary opinion, it echoes an earlier judgment in favor of WhenU in its case against U-Haul International. Like Wells Fargo and a handful of other litigants, U-Haul had charged WhenU with trademark and copyright violations, among other complaints, as a result of pop-ups for competing movers that appeared on U-Haul's Web pages. In September, a Virginia U.S. District Court judge granted a motion for summary judgment in favor of WhenU.
WhenU makes software that tracks the movement of Web surfers and serves up targeted ads to those who are likely to make a purchase. For example, an ad for travel site Priceline.com might appear while a surfer is visiting Travelocity.com. The software is bundled with other popular downloads, such as peer-to-peer software BearShare or weather applications, that consumers use for free by agreeing to receive occasional ads. About 30 million Net users have WhenU's software on their desktops.
"The fact is that the computer user consented to this detour when the user downloaded WhenU's computer software," the judge's summary read. "While pop-up advertising may crowd out the U-Haul advertisement screen through a separate window, this act is not trademark or copyright infringement, or unfair competition."
These decisions could add up to approval for a controversial sector of online advertising--and lend a hand in a more well-known case that involves "adware" company Claria, formerly Gator. Like WhenU, Claria develops an Internet "helper" application that often comes bundled with popular free software such as peer-to-peer applications. When downloaded, the programs from Claria and WhenU serve pop-up and pop-under ads to people at various times while they're surfing the Web or when they visit specific sites.
Gator's software has landed it in court against The Washington Post, catalog retailer L.L. Bean and hotel chain Extended Stay America. In February, Gator settled a case brought by The Washington Post, and its other lawsuits have been consolidated and will be decided by the Judicial Panel on Multidistrict Litigation in Washington, D.C.
Wells Fargo characterized the decision as "a set back" for consumers.
"This form of advertising can create confusion for impacted customers who visit financial sites and believe the offers they are receiving are from that financial institution," according to a Wells Fargo representative. "The source of these pop-up advertisements may not always be clear to the customer. It's important for customers to know who they are dealing with online, and we took action to eliminate this source of confusion for our customers."
http://news.com.com/2100-1024-5109596.html
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Kazaa Rings in Royalties for Artists
New Kazaa Version Launches With Ringtone Channel, Faster Searching And New Content Distribution, Packaging and Pricing Technology
Press Release
Sharman Networks Limited today launched Kazaa v2.6, the latest update of the world's most popular file sharing software. The new version includes a pre-installed Ringtone Channel, which will provide revenue to major record labels and artists by offering Kazaa users over 3,500 monophonic and polyphonic mobile phone ringtones for purchase through the Kazaa application. The ringtones available include tracks from the Top 10 UK, US and Euro charts.
This latest version of Kazaa also introduces advanced features that make browsing, trying, buying, promoting and selling downloadable content easier, including the option to run 24 multiple searches at the same time, access to streaming previews of licensed content, single click purchasing, Kazaa Kapsules and Magnet Links.
Through The Ringtone Channel, Kazaa's estimated 60 million users worldwide can buy licensed mobile phone ringtones using a global payment system that takes into account the different networks and licensing requirements in each country.
According to Nikki Hemming, CEO of Sharman Networks, "Kazaa users are already downloading and buying mobile phone games through the Air Arena Channel. The Ringtone Channel expands Sharman's mobile content offering by providing thousands of licensed musical ringtones, screensavers and logos for download through Kazaa. The mobile and wireless platform is a rapidly growing and exciting marketplace."
Key new features and technologies in Kazaa v2.6 include:
Kapsules
New to Kazaa v2.6, Kapsules are a collection of multiple individual files digitally packaged together as a 'single click' download. "Kapsules are like buying the 'CD case and booklet', rather than just a music track," said Ms. Hemming. "They're about delivering a unique entertainment bundle in high quality digital format." A Kapsule can include music, exclusive footage of live performances, lyrics, tour dates and images from the same band or artist. Equally, computer game companies can include game guides and hints, and movie distributors can include 'behind the scenes' footage.
Magnet Links
Magnet links are a powerful promotional tool offering significant bandwidth savings to content providers. Kazaa v2.6 will enable users and content creators of all types, such as record labels, musicians, artists, photographers, and software developers, to promote and sell their content at around 20% of the cost of traditional website distribution. Consumers benefit from a greater variety of content that can be downloaded faster and more cheaply. With Kazaa v2.6 installed, clicking on a magnet link in any web browser, email or document will initiate a file search and download via the Kazaa application directly to the user's computer.
A magnet link can be created simply, then pasted into emails or websites for public or targeted promotion. This will allow a broader range of content creators and distributors to leverage the bandwidth efficiencies offered by peer-to-peer distribution. Existing audio, games, software and video content partners have experienced reductions in server loads as high as 94% by using Kazaa peer-to-peer distribution.
http://www.prnewswire.com/cgi-bin/st...2003,+11:48+AM
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Macintosh Users Join Kazaa Network
John Borland
A new piece of file-swapping software for Macintosh computers is drawing thousands of downloads by offering peer-to-peer options previously available largely to Windows computers.
Originally released in July, and updated substantially since then, the "Poisoned" file-swapping software allows connections to the hugely popular FastTrack system as well as several smaller networks. That means that for the first time Apple Computer owners have direct access to the vast Kazaa network, which includes millions of people.
"The Macintosh has been very underserved, very neglected," said Julian Ashton, the Atlanta contract programmer who is leading development on the project. "That's why this is an ideal project."
Poisoned's quick rise during the past few months appears to pull the Macintosh closer to the Windows world, in which competition from the free file- swapping world is widely viewed as one of the steepest hurdles for authorized music services like Apple's own iTunes song store or RealNetworks' Rhapsody subscription service.
According to Download.com, a software aggregation site owned by News.com publisher CNET Networks, Poisoned has been downloaded more than 165,000 times in 10 weeks of availability there, making it the second most popular piece of Macintosh software on the site, behind fellow file swapper Limewire.
Several other peer-to-peer programs are available for the Macintosh that tap into FastTrack and eDonkey, the most popular Windows-based networks, but none has grown as quickly as Poisoned. Previously, the most prominent option was the Gnutella-based Limewire, a well-regarded piece of software that nonetheless tapped into a network far smaller than Kazaa's sprawl.
Some analysts say iTunes has established a reputation for simplicity and high-quality downloads, particularly among loyal Macintosh users, that could keep people paying for songs instead of searching for free content on Poisoned or any other service. According to Apple, by early November it had sold more than 17 million songs from its iTunes store, which by that time served Windows and Macintosh computers.
"If Apple is doing its job they should be able to compete against free based on quality and reliability," said Michael McGuire, an analyst with GartnerG2, a division of the Gartner research firm.
The Poisoned project is one of the first based on a long-running attempt by independent programmers to tap into the FastTrack file-swapping protocol--the technology underlying Kazaa, iMesh and Grokster--without the authorization of Kazaa or the technology's creators. That so-called gift project is also the inspiration for Poisoned's name-- "Poison" is German for "gift," Ashton said.
Several times in the past few years, the FastTrack creators have changed the encryption scheme that keeps outsiders from tapping into the proprietary file-transfer system, but the independent programmers have caught up each time. If FastTrack changes again, Ashton says he is confident that a new version of Poisoned can be developed quickly to tap back into the larger swapping service.
Currently, bugs in the software allow downloading only from the Kazaa network, while files can be uploaded to Gnutella, as well as the smaller networks OpenNapster and OpenFT, another variation based on FastTrack's features.
That lack of uploading capacity could help keep some Poisoned users out of the sights of the Recording Industry Association of America (RIAA), which is in the midst of a campaign of lawsuits against individuals alleged to have offered large number of copyrighted songs for download by others online.
It's not a perfect shield, however. Already, Poisoned users in the project's online discussion forums have reported that at least one Macintosh file swapper has been targeted by the RIAA's legal actions.
Ashton said he doesn't encourage use of the software for illegal purposes. In fact, by day he works to create content protection technologies for media companies in California.
"I'm very much for digital rights management," he said. "I don't promote people distributing copyrighted material, but I do feel that people should be able to access any kind of network they want to."
http://news.com.com/2100-1027-5109645.html
Top 10 D/Ls - Singles
BigChampagne
iTunes Gets File-Sharing Helping Hand
Ina Fried
An independent software developer has created a program called MyTunes that lets users of Apple Computer's iTunes for Windows grab song files from other people on a computer network.
While iTunes' main purpose is let people buy music online and play songs stored on their PC, the software also includes a feature that allows customers to listen to songs stored on another PC on their local network. Apple's software makes no permanent copy of the song, but the new MyTunes software captures that 'stream' of music, making a copy that can be burned to a CD, uploaded to the net or streamed to another PC.
MyTunes' creator, Bill Zeller, said on his website: "iTunes does not allow you to save this music to your hard drive. MyTunes lifts this restriction by allowing you to save music from other computers to your hard drive."
While stream recording is not new - a myriad programs exist for recording web radio and other streaming net services for Windows and Macintosh computers - the ease with which the MyTunes software fits into iTunes pushes the experience to a new, and perhaps legally risky, level.
Running the program makes creating your own MP3 songs from someone else's collection as easy or easier than grabbing MP3s via traditional file-swapping software like Kazaa. That could complicate things for Apple, which depends on the music industry's support - and indeed, has won unprecedented kudos from labels and artists - for its iTunes music store.
The iTunes stream-sharing feature has already been widely adopted inside companies and on college campuses, where computer users can sample co-workers' or fellow students' music collections, as long as they're both using iTunes and their computers are on the same network.
As set up in iTunes, this is more akin to on-demand webcasting than true file-sharing - but even tiny webcasters are in theory required to pay a royalty to record companies and artists for streaming songs online.
With the advent of MyTunes, the large iTunes collections become more like a collectively distributed database of songs from which anybody can download - something that looks a lot like Kazaa, although without the search features.
Only unencrypted MP3 files are easily captured and copied using the MyTunes software, however. Songs purchased from Apple's iTunes store, which are protected by the company's proprietary digital rights management technology, do not work with Zeller's software.
The Recording Industry Association of America (RIAA) declined to comment on the iTunes or MyTunes features. Previously, the RIAA has targeted corporations in which large MP3 libraries were available to employees through an internal computer network, settling for $1m in one case. The group has also sent letters to businesses and colleges warning about the potential legal dangers of letting employees or students use file-swapping services to exchange copyrighted works.
The ability to stream music stored on another computer has been part of iTunes for the Mac for some time. Apple scaled back the feature after some people started sharing songs over the internet.
For his part, Zeller said on his website that he expects that MyTunes users will not do anything illegal with the software.
"And remember, copyright infringement is illegal," he says at the bottom of the page. "If you have any question whether what you're doing constitutes an infringement, visit the RIAA's great antipiracy website."
http://www.silicon.com/software/secu...9116896,00.htm
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AudioGalaxy founder starts new file-sharing firm
Software Allows File Access From Different Computers
The founder of Austin-based AudioGalaxy Inc. is entering a new business realm.
Michael Merhej, former CEO of AudioGalaxy, has formed a company called ByteTaxi Inc. that will distribute file-sharing software to the masses. The software, called FolderShare, allows users to access files on different computers, update those files and save the changes.
File sharing is how AudioGalaxy became notable. Its software allowed users to share music files for free over a peer-to-peer network. Several music industry associations alleged the service violated copyright laws.
In May 2002, the Recording Industry Association of America filed a lawsuit against AudioGalaxy alleging copyright violations. The suit was settled in June, with AudioGalaxy agreeing to ask permission before letting users download music. It also made an undisclosed payment to the trade association.
Fast forward to 2003: Merhej has recruited two AudioGalaxy employees with him to ByteTaxi. He no longer is CEO of AudioGalaxy but remains on the company's board. AudioGalaxy has two employees, down from 10 at its height.
One-year-old ByteTaxi employs three people and shares space with AudioGalaxy at 707 West Ave. in downtown Austin. An advertisement for FolderShare appears on the AudioGalaxy site.
"We're very separate companies with different employees," Merhej says. "We came to the conclusion that there's really nothing new we can pursue with AudioGalaxy. We are kind of burned out on the music business. From that point forward, we felt we could turn to something else."
He hopes that something else will become a source of revenue for ByteTaxi once the startup releases the FolderShare software in three months. For now, ByteTaxi isn't charging for the software but eventually plans to launch a subscription costing about $3.50 a month for consumers and $9 a month for business users.
"We're not going to hire a big sales force or anything. We want to keep the company as small as possible and get the maximum number of people to use [FolderShare]," Merhej says. "That's what we did with AudioGalaxy."
AudioGalaxy's Web site once received about 4 million daily visits and was profitable. Despite its limited offerings today, AudioGalaxy's site still receives about 20,000 unique visits a day. Merhej says he thinks ByteTaxi also can turn a profit.
"It's not like we are going to be this large, wild software company that has an IPO or outside investors," Merhej says.
Already, without the official launch of its product, ByteTaxi has about 75,000 accounts and 10,000 regular software users. Merhej hopes to keep that number growing through word of mouth and by encouraging users to bring the software to their workplaces.
One user of the ByteTaxi software is Ryan Hoge, president of Austin-based information technology consulting firm Capitol Technology Group. He uses the software for himself and some of his clients. The software offers an inexpensive way to back up network systems for disaster recovery.
Capitol Technology provides a backup service using FolderShare for about $430 a month. If a customer wants to back up its systems using existing hardware and software, it could cost about $2,000 just for equipment on the customer's end, Hoge says.
By making its software available over the Internet for free, ByteTaxi is gaining valuable insight from potential customers, says Bryan Menell, president and CEO of Austin-based e-learning company Fusion Learning Systems Inc.
Menell, who has started a few businesses, says determining whether customers will buy your product or service is key. One of his companies, KnowledgeBeam Inc. spent about 5 percent of $500,000 in angel funding but determined a market for the product didn't exist. So Menell says he returned the investors' money and closed KnowledgeBeam.
"You can do research and pull numbers on how big the market is, but until you talk to people who will buy your services, it's tough to validate your ideas," Menell says.
http://austin.bizjournals.com/austin...10/story5.html
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26Mbps on DSL
Full Speed Ahead For Japan's Broadband
J Mark Lytle
With BT set to launch its new 1Mbps Asymmetric Digital Subscriber Line (ADSL) broadband net service on 20 November, it is worth taking a moment to consider just how broad the UK's band really is.
According to Bruce Stanford, BT Wholesale's product director, trials in October showed there was a "strong consumer demand" for the service, which is twice as fast as the company's current offering.
As statements go, that is rather like those surveys showing that most people feel undervalued at work, or that they would like to be having a little more sex than their current ration.
Blindingly obvious, in other words.
The more important issue is whether British internet users are being sold short. After all, a speed boost of 512kbps is no great shakes, especially when you consider that you will be lucky to get half of that when network congestion and distance from the telephone exchange are factored in.
Here in Japan, ADSL is a firmly established technology, with the locally owned arm of Yahoo, called Yahoo BB, the market-leading net service provider. This summer, Yahoo BB signed up its three millionth customer for services running at eight and 12Mbps. This success was almost entirely down to the aggressive marketing masterminded by parent company Softbank's CEO Masayoshi Son.
For the last year, it has been nigh on impossible to take a stroll in the capital without being asked, "Yahoo BB wa ikaga desu ka? (How about Yahoo BB?)," by one of Mr Son's army of street salespeople ready to sign you up and send you on your way with an ADSL modem in a bag.
Now, with the latest tranche of upgrades taking the maximum download speed to a blazing 26Mbps - remember, this is still over standard telephone lines, just like in the UK - one can be forgiven for wondering why BT and its competitors are languishing in the slow lane.
Japanese surfers clearly have a good deal. Yahoo BB's 26Mbps package costs just 3,838 yen, or about £20 per month, which is around £10 cheaper than the new BT deal. The Japanese package includes modem rental, the service provider fee, and a subscription to the company's IP (Internet Protocol) phone service, BBPhone, offering dirt-cheap phone calls.
For an extra 1,000 yen, there is a wireless LAN pack available. On top of all that, the whole caboodle is free for the first three months.
We asked a few members of the public about their perceptions of internet use in Japan. The overriding impression was that net access is no longer the domain of geeks it was five years ago. Rather, it is seen as a utility like gas or water that is "simply there".
"I'm online for just few hours a day, mainly sending photos to clients, but fast internet access makes all the difference," explains Eriko Tohno, a freelance photographer working out of her Tokyo apartment.
"It used to take me far longer, as I tended to send discs by courier."
Or like one peer-to-peer fan who says, "I like to download movies and music from file-sharing networks, which is fast and simple these days.
"If I like them, I just go out and buy the CD or a cinema ticket."
http://news.bbc.co.uk/1/hi/technology/3278375.stm
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Korea to build 100M bps Internet system
Infrastructure will offer telecom, broadcasting and Internet access from a variety of devices
David Legard
South Korea plans to build a nationwide Internet access infrastructure capable of speeds between 50M bps (bits per second) and 100M bps by 2010, the online edition of the Chosun Ilbo daily newspaper reported Tuesday.
The infrastructure will be known as the broadband convergence network (BcN) and will offer telecommunications, broadcasting and Internet access from a wide variety of devices, the paper said, quoting the Ministry of Information and Communication.
Construction of the BcN will be worth 95 trillion won (US$80.4 billion) in output of equipment and services, and will create 370,000 jobs by 2010, according to the Chosun Ilbo.
South Korea is already regarded as the world's leading broadband nation, with 11.3 million broadband subscribers in a population of 48 million, and with 85 percent of new subscribers opting for broadband, according to telecommunication equipment vendor Alcatel SA.
http://www.infoworld.com/article/03/...HNkorea_1.html
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Music Biz Exposes Parental Irresponsibility
Keith Girard
When the Recording Industry Assn. of America launched the first wave of lawsuits against illegal downloaders, it indirectly raised an important question: Where were the parents?
It quickly became apparent that in many cases, they were nowhere to be found. It seems as though computers had become to the 21st century what TVs were to the 1950s -- high-tech babysitters.
You know the old adage, out of sight out of mind? Well, many parents seemed to take the attitude, "If it keeps the kids out of my hair, all the better." As long as they were glued to the video display screens in their room, what possible trouble could they get into, right? As it turns out, they could get into quite a bit.
The RIAA legal campaign revealed a serious disconnect between kids and their parents. There's not much new about that. The generation gap is probably as old as civilisation itself. But the lawsuits served as a dramatic wakeup call.
The Internet is a wonderful thing, but it's also a lot like the Wild West. We're still on the frontier of the Information Age, and it's pretty much a place where anything goes.
In its effort to rouse concern about illegal music downloading, the record industry discovered that kids were exposed to a lot more potentially damaging material -- such as child pornography.
The good news is that in the wake of the RIAA's campaign, at least some parents are taking more responsibility for what their children do on the Internet.
In August, as many as 1.4 million families in the U.S. deleted all of their digital music files, according to research firm NPD Group. What's more, the company attributed much of the trend to the RIAA's lawsuits.
It also claimed that the number of households downloading peer-to-peer file-sharing software had declined by 11% from August to September.
Now for the bad news. It appears that illegal file swappers are heading underground. According to one university professor, trading on open P2P networks may be declining, but private file-sharing systems are on the rise, using everything from specialised software to Microsoft Messenger, which is free.
So while the RIAA may be putting a dent in mass file sharing, it's facing an ever more difficult problem -- and technology won't make things any easier.
For one, the storage capacity on computers is growing. The newest personal computers come with 100- gigabyte hard-drives. But it's possible to get them with up to one terabyte (1,000 gigabytes) of storage. And by 2008, experts say 15-terabyte systems will be common. That's enough to hold every song ever recorded -- about 5 million tracks -- using today's MP3 format.
That means the RIAA had better be ready to carry on its legal war indefinitely. Or how about this: Find a way to harness that technology. You know the old saying: If you can't beat 'em, step in and take away their market.
http://www.reuters.co.uk/newsPackage...7§ion=news
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Banks Could Teach Music Firms How to Click
Michael Hiltzik
These are cynical times, and journalists are a cynical bunch. But that's no reason not to give proper credit to a large corporation — indeed, pretty much to an entire industry —that figures out how to do right by consumers while doing right by itself.
This thought occurred to me a few weeks ago while I was reviewing my Bank of America checking account via the bank's Web site. By chance, I discovered that BofA had quietly added a new function: A click of the mouse brought up the image of any check that had been written and cleared within the last few months.
That reminded me of how much BofA's online service had improved over the five years or so that I had been a regular user. Electronic bill payment was easier and faster, with most payments made within two days. I can order checks, stop payments, download my monthly statement to my home computer, even receive electronic bills — all free. The check-image feature wasn't one I ever would have thought to request, but there it was. When was the last time a big consumer-service company offered you a convenience you hadn't asked for?
This isn't meant to be an advertisement for Charlotte, N.C.-based Bank of America Corp. or a general endorsement of its services over those of competing retail banks. Like any other huge institution, this one commits enough embarrassing mistakes to make its slogan, "Higher Standards," sound sometimes like an exercise in corporate irony. (Consider its admitted complicity in an illicit "market-timing" scam uncovered this fall that victimized investors in mutual funds.)
But even experts seem to have noticed that BofA, along with other big banks, has found a way to make the Internet work for its retail customers as well as for itself. For a couple of years, the dot-com crash led Silicon Valley to think there was no money to be made in pushing online technology at consumers, but the banks have quietly shown the logic in spending heavily to lure their clientele online and to make sure their systems are secure and reliable.
This didn't happen overnight. The first electronic-home-banking experiments date back to 1995, when customers of San Francisco-based Wells Fargo & Co. and a few other institutions could check their balances and see their transaction histories on a Web page.
"Almost every bank stumbled when it first came online," Chris Musto, the vice president for research at Gomez Inc., a technology consulting firm, told me.
"The customer representatives didn't even know how to use the service, and some banks had issues with outages. But they know now that they have a vested interest in maintaining a very reliable Web site because it's your money, and if you ever have trouble accessing your money, it's very bad for the bank."
At this point, according to Musto, about 1 in 4 banking customers nationwide access their accounts online.
BofA has found that its attrition rate among online users is 80% lower than among those who do their banking in person. Sanjay Gupta, who heads a 200- person online banking team at BofA split between San Francisco and Charlotte, also notes that users of the bank's online bill-paying service maintain 38% higher deposit balances at the bank. That's presumably because they concentrate more of their overall transactions in the online account.
Those statistics, Gupta says, were enough to convince the bank that it should make online banking and bill paying free for all account holders — a move that has helped build its online customer base to 6.6 million users, growing by 50% a year.
Some banks, including Wells Fargo and Washington Mutual Inc., still charge a monthly fee for bill paying unless the user maintains a minimum balance of several thousand dollars. Some experts think this is being penny-wise and pound-foolish, because it's almost impossible to make online services pay for themselves.
Years ago, it was assumed that banks promoted online or telephone bill paying because they profited from the "float": If the bank debited your account for a payment you ordered on a Monday but the payment didn't clear until Friday, it earned four days' interest on your money.
But that was never a profit generator. "The float pales in comparison to the effect online bill pay has on your retention of customers and the higher balances customers maintain," Musto says. The expansion of electronic bill payment, moreover, has cut the period that funds remain in transit to only a day or two.
It's easy to say that the banks don't deserve credit for only doing what they must to keep customers happy. But developing and maintaining a reliable and user-friendly Web service is a lot harder than it looks. Just consider the hash that other industries have made of their ventures online, starting with a business for which the Internet should have been a lifeline: recorded music. (For those under 40 who may not be familiar with this industry, it was a profitable business prominent during the last century.)
It became obvious as far back as 1997 that music in digital form could be easily transmitted over a network and played from a computer. Instead of snapping to attention, the music labels snoozed. Napster arrived two years later, introducing the concept of home-cooked music piracy to the masses. In response, the industry rolled out a few sites offering downloadable pop tracks at exorbitant prices, ensuring that tens of millions of users would opt for free samples instead.
The appearance this year of numerous pay-per-download services — such as Apple Computer Inc.'s iTunes, RealNetworks Inc.'s Rhapsody and Roxio Corp.'s redesigned Napster — has hardly solved the problem. Leaving aside that the free-music horse has long ago left the barn, the new sites are highly variable in ease of use; they all seem to offer different catalogs; and none has found the right balance between subscription and pay-as-you-go models. The industry's defense is that these are new services still finding their way, but that only underscores its dereliction in waiting so long.
Many other industries are also squandering a chance to build customer loyalty through their online services. A recent survey by the San Mateo, Calif., market research firm Vividence Corp. found that among customers of telecommunications services — encompassing phones, Internet and cable TV — users of online Web sites are twice as likely to change their providers over any six-month period as offline customers. Among the reasons Vividence cited was that the longer those customers spent on the companies' Web sites, the more chances they had "to experience frustrations." Until telecom companies start offering online users valuable promotional deals or convenient account management options, Vividence says, this phenomenon will continue.
By contrast, the banks have plainly learned how to use online offerings to keep customers in the house.
This is a lesson first taught by Time Warner Inc.'s America Online unit and Yahoo Inc. They recognized that once a user gave out aol.com or yahoo.com as an e-mail address, he or she would be loath to move to another service because that would mean informing all those correspondents of the switch. The concept was known as "stickiness." A savvy bank, by the same token, knows that once a user has built up a critical mass of payees in its bill-paying service, he or she will be reluctant to go through the process with some other bank.
Could anyone have predicted that an industry once known for the insensitivity of its customer relations would become a leader in deploying new technology, even given its aggressive rollout of automated teller machines in the 1970s? Starting with the founding of Amazon.com Inc., in 1994, the received wisdom in the cyberspace community was that a successful online service would only be held back by bricks and mortar. It will be a long time before banks, no matter how sophisticated their Internet systems, can dispense with local branches or ATMs. People, after all, still need cash. "But the banks aren't into the Web as a fad," Musto says. "This is part of the mainstream."
http://www.latimes.com/technology/la...nes-technology
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U.S. Agency Reviewing Internet-Related Patent
AP
In an unusual move, the Patent and Trademark Office is reconsidering a patent affecting Internet pages that critics contend could disrupt millions of Web sites.
Citing "a substantial outcry from a widespread segment of the affected industry," Deputy Patent Commissioner Stephen G. Kunin ordered the agency's examiners to reconsider the patent they awarded in November 1998 to three University of California researchers.
The patent affects how Internet sites build into Web pages small interactive programs that power features such as banner ads and interactive customer service.
Eolas Technologies Inc., which was founded by one of the inventors and has licensed the patent exclusively, has begun enforcing its claims and recently won a $520-million jury award against Microsoft Corp., which quickly appealed the judgment.
http://www.latimes.com/technology/la...nes-technology
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EBay, Microsoft Form Internet Security Group
Bloomberg News
Executives from EBay Inc., the world's largest Web auctioneer, and Microsoft Corp., the world's biggest software maker, are forming a group to address security issues on the Internet.
The Global Council of Chief Security Officers is starting with 10 members from some of the largest U.S. companies and will be expanded to include members from outside the U.S., according to EBay Vice President of Security Howard Schmidt.
Concern about the security of personal and financial information on the Internet has risen as companies use it for commerce and communication. Problems range from computer viruses to identity theft and fraud.
http://www.latimes.com/technology/la...nes-technology
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California Secretary of State Orders Audit of All Counties' Voting Systems
Review of upgraded touchscreen software leads to discovery that two registrars installed it without state's OK.
Allison Hoffman and Tim Reiterman
Responding to revelations that at least one county used unapproved voting software in the Oct. 7 recall election, Secretary of State Kevin Shelley has ordered an audit of voting systems used in all 58 California counties.
State elections officials reviewing an upgraded version of Diebold Inc.'s Accuvote touchscreen voting machines for future certification were told by company employees that the new software had already been installed in Alameda and Plumas counties — without state approval.
The software had been certified by a federal panel for use in the states.
"We believed that with the federal certification [of the software], we were meeting state certification," said Diebold spokesman David Bear. He said the company would cooperate with the audit.
Shelley also said he would require the chief executive of each voting system company to affirm, under penalty of perjury, that no significant changes be made to elections systems or software without asking for approval from the secretary of state's office.
Terri Carbaugh, a spokeswoman in the secretary of state's office, said, "From our point of view, modifications to software require certification."
Alameda and Plumas counties are the only two in California using the Diebold touchscreen systems. Bradley Clark, Alameda County's registrar, said that the new software had been installed before the recall election, but Kathleen Williams, Plumas County's registrar, said that she had not installed the upgrade before the election.
Los Angeles County Registrar Conny B. McCormack said the incident highlighted ongoing uncertainty in Sacramento about how to regulate electronic voting.
She said all counties in the state, whether they use electronic or mechanical voting systems, had installed significant software upgrades in the past several years to accommodate changes to primary voting and to handle the unique recall election itself.
"All of us have made changes to our software — even major changes — and none of us have gone back to the secretary of state," McCormack said. "But it was no secret we've been doing this all along. [Shelley] knew we were making changes."
http://www.latimes.com/technology/la...nes-technology
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DRM Music Goldrush Is A Race For Losers - Mp3.Com Founder
Andrew Orlowski
Apple is leading a race of lemmings into the zero-profit business of closed music downloads, says the founder of MP3.com, Michael Robertson.
"It seems kind of crazy to me, the economics don't make sense," Robertson told us Thursday. "Why are all these guys like Microsoft and Wal-Mart rushing into a business where the industry leader says 'we cannot make money with the contracts that we have'?"
"This is a race where the winner gets shot in the head."
And William Tell-style, Apple volunteered to be the first into the firing range. Canny Apple has had to swallow the pigopolists royalty fees, and DRM restrictions, but it thinks it has a business because its closed business model sees downstream profits from iPods sales.
Robertson started MP3.com in 1998 and after a barrage of lawsuits, sold it to Vivendi Universal in 2001. Last week, after a night on the tiles, Vivendi sold the mp3.com domain name to CNET, leaving the million-song archive to the vultures. (Robertson is striving to find a host for this, and we shall have more news of this later today).
The computer industry traditionally opposed the copyright cartel, but Apple was the first snitch to cut a deal with the pigopolists. Was this wise, we wondered?
"If one company got a huge market share - say 50 per cent or higher - they could negotiate better royalty rates," notes Robertson. "But they forget something. The music industry is tens of thousands of publishers and just five major record labels. Getting all of them to agree is a real tough thing to accomplish even if you're market leader."
Without any Beatles songs, and with only one Roxy Music track on its music kiosk, Apple is currently in a position of begging the big five for content, rather than dictating the terms of the deal. It's the rebel without a clue. Can it turn the tables?
Well, there are several factors that ought to halt the wannabee players in the DRM goldrush in their tracks. A compulsory licensing scheme (which is now backed by the libertarian rights group the EFF) is one. But Robertson points to another: the decision by courts to permit KaZaA peer to peer-style sharing.
"It's the wild card," says Robertson. "KaZaA has been ruled legal, so why pay for restricted music?" he asks.
"Apple really haven't sold that much music. And they've received millions of dollars in free advertising. Don't get me wrong, Steve Jobs is a smart guy who knows the economics. He's clearly betting that he can subsidize it with profits from iPods, or get enough scale to begin renovating the royalty deals."
"It's a real dilemma for me," he says, echoing the thoughts of millions of peer to peer music lovers. "If I 'steal' music from KaZaA I get all this music, but if I pay I have all these restrictions."
If people can get unrestricted music for free, why would they need to go to a DRM store to get a low-quality version with all the strings attached, Robertson wonders. KaZaA, and future P2P technologies make file sharing so simple and fun.
"People will use P2P and people will buy CDs," he predicts.
With so many people - other than the DRM gold rush entrepreneurs - accepting such constraints, accepting that people will always want to share music, and technology will always outwit DRM controls - we're left with the ethical problem of how to compensate the artists.
(Which is why there is such momentum behind compulsory licenses right now. Many people accept that stopping music-sharing is a lost battle, so our better minds are thinking of schemes to use the technology to compensate artists fairly).
Robertson doesn't agree with the idea of a levy, but agrees "there needs to be a radical change here".
And pundits should be wary of Apple's early apparent success, he warns. "I'm not sure if an Apple user is representive sample of the population," he says.
True enough.
Paying for restricted versions of songs they could have got unrestricted and for free has been the real litmus test for Apple loyalists. It's a hurdle they've leaped over with glee. But how many will follow them? Has Steve Jobs mistakenly extrapolated cult behavior and assumed the rest of the world follows shares these values, and follows these assumptions?
That's not what we hear from you.
It's rather tasteless to remind you that this week is the twenty-fifth anniversary of the Jonestown Massacre - where a charismatic San Franciscan decamped to the jungle and persuaded almost a thousand followers to commit suicide, by drinking toxic fruit juice. It gave birth to a lasting idiom: "have you drunk the Kool-Aid?"
Well, have you?
http://www.theregister.co.uk/content/6/34125.html
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Spinning Your CDs Through Yoghurt
WANT to listen to something different? A Melbourne scientist suggests smearing yoghurt on your favourite CD, then let it dry.
Slide the disc into the player. Crank up the volume. And hear that music in a completely fresh, possibly spine-chilling way.
The bizarre innovation -- an "optical biocomputer" if you must know -- is the brainchild of Cameron Jones, who, as well as being a mathematician with a record of published research, also owns a nightclub and bar in Melbourne, New Scientist reports.
Jones' pet area of research is how signals can be transmitted through biological cells, which grow in a so-called "fractal" way, like tree branches.
He became intrigued by experimental musicians and DJs who sanded, varnished or even slapped paint onto CDs to create new sounds to sample.
Music on CDs comes from tiny etched pits in the tracks that represent binary digits, the "0" or "1" that make up a computer code. The code, reflected back by the laser in the CD player, is then processed back into an electronic signal and converted to sound.
Mutilating the surface, so some of the pits are missed, thus changes the sound.
But Jones found much subtler sounds could be achieved using fungal or bacterial growth, rather than scraping or coating the disc's surface. This is because these life forms introduce tiny errors on a micron or nanoscale level rather than a far bigger millimetric scale.
In addition, fungus and bacteria can shape the sound in weird ways. Bacteria grow by cell division, while fungi grow by branching. Both processes can be controlled by adding malt extract to the disc as food.
Jones told New Scientist he came across the discovery quite by accident, when he was DJing in his bar.
"I often change CDs when my hands are wet with beer," he told the British weekly. "One night I must have changed the CDs, touched the data surface, then left them for use on another night."
The following week, he put on a CD by Nine Inch Nails and found it would not play properly because fungus had grown on it.
But the fungus had not ruined the disc. The original audio sequence was there, but it would sometimes change in pitch and there were small staccato noises in the background.
He asked himself: "What would happen if I purposely grew fungi, yeast or bacteria in direct contact with the media, and manipulated their fractal dimensions?"
Judge the sounds and work for yourself at
www.swin.edu.au/chem/bio/fractals/ refslist.htm
http://australianit.news.com.au/comm...=date&Intro=No
Until next week,
-
js.
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Current Week In Review.
Recent WIRs -
http://www.p2p-zone.com/underground/...threadid=17925 November 15th
http://www.p2p-zone.com/underground/...threadid=17877 November 8th
http://www.p2p-zone.com/underground/...threadid=17835 November 1st
http://www.p2p-zone.com/underground/...threadid=17790 October 25th
Jack Spratts Week In Review is published every Friday. Please submit letters, articles, and press releases in plain text English to jackspratts at lycos.com. Include contact info. Submission deadlines are Wednesdays @ 1700 UTC.