[JackSpratts]

Slow Burn

This was the week we learned just how far the RIAA would go to maintain its hold on Western culture, and *yawn*, how “big a deal” it was not. The number of people sharing files – and the number of files being shared - has not diminished in any measurable way so far. While this may change once reports come in on subpoenas issued and their dollar amounts, it may not even change then. In the U.S. it’s estimated that about 60 million people use peer-to-peers but anecdotal evidence suggests something far greater. My guess is in the 80 to 100 million range. If the RIAA manages to subpoena a truly amazing 10,000 people it will make itself the scourge of the West, but as a percentage of users attacked they’ll be hitting a miniscule one hundredth of one percent. That’s just one file sharer out of 10,000, and that’s if they somehow manage to fight that many to begin with which seems unlikely to me. I’d imagine the amount of people actually going to trial in the dozens, or hundreds. Not thousands or tens of thousands. Even still, if the recording industry manages to gear up to an evil-empire-sized suing machine capable of squashing 10,000 moms, pops, juniors and sissys, the odds remain overwhelmingly in favor of the file sharers. Overwhelmingly.

This has not been lost on the file sharers, even those at the wrong end of the RIAA’s howitzers. Their numbers continue to rise.

This has not been lost on all the members of the RIAA either, many of whom are trembling in awe at the mountains of bad press rising from these lawsuits, and who are at last openly questioning the strategy, and perhaps more importantly the basic premise of a lobbying group that is managing to squander 100 years of billion dollar profits while turning its members into pariahs. With anti CD boycotts popping up all over the world, it’s not a stretch to say that soon the biggest negative effect on sales won’t be high prices, boring products, or even a slow economy; it will be the record companies’ themselves. Their own terrible reputations magnified by the RIAA’s outrageous strong arm tactics could bring a halt to sales. People just don’t support groups that attack them, and people find it difficult doing business with people who sue their friends. Who can blame them? It’s common sense self preservation.

It’s an amazing thing to watch all the same. The destruction of the record business by the record business is like watching in ultra slow motion a bomb go off in the hands of the bomber, over the course of several years. Every mistake is magnified and every mistake obvious to all but the bomber herself. It makes me want to shout “Don’t cross those wires!” But she does. It’s her nature I guess, and another electron shoots to the infinite, another business to oblivion.

Any more than you can halt summer’s passing or slow the tides, file sharing won’t be stopped or appreciably changed. There might be helpful technological responses from the software developers. They may create something a little or a lot more anonymous. ISP’s might bow to subscriber pressure and stop keeping records of Internet Protocol addresses, instantly making file sharing anonymous. This would deprive the RIAA of the names and alleged evidence upon which these suits are based. ISP’s – or even the courts - may yet play a role, especially if this new non-judicial subpoena system becomes a boondoggle, and I think it will though that’s another story. Still and all the technical client side fixes are band aid approaches at best and not particularly necessary. The sun is setting on that day. The people have spoken. File sharing isn’t the unspeakable thing in the attic anymore, it’s now the 900 pound gorilla in the living room and it’s pretty comfortable right where it is, thanks. It’s the people. They file share. They like it a lot and they’re not going to stop. Ride it for sure, but it’s not a train anyone with any sense should stand in front of.

What you can do is take a page from the file sharers themselves and learn to use Peer-to-Peer to your advantage. And experience a whole new world of opportunities.










Enjoy,

Jack.










Music Industry Threats Not Slowing File-Sharing Volume
Andrew J. Manuse

Companies that develop music-sharing software and people who download copyrighted music were not frightened by the recording industry's threat Tuesday to sue

computer users who illegally offer to share ``substantial'' amounts of music.

``I don't expect the threat to have an impact,'' said Wayne Rosso, president of the file-sharing network called Grokster. Rosso said the recording industry was just hurting itself by going after its own customers.

Grokster usually has 3.5 million to 4.5 million users at any given moment, he said. At 6 p.m yesterday, 3.8 million people were on the network.

A spokesperson from Sharman Networks, the company that owns another popular network called KaZaa, said the average number of KaZaa users at any given time is about 4 million. Post threat, there were 4.2 million people downloading music at around 5:30 p.m. yesterday.

Greg Bildson, CTO and COO of Limewire, another network, said he has seen no decrease in users since the recording industry's threat and doesn't expect one.

Still, the Recording Industry Association of America is threatening to sue the users of the networks, not the companies that run them.

Jessica Gleason, 20, a student at UMass Amherst, is one of those users, but she wasn't worried.

``There are enough (network) systems out there that (the recording industry) is not going to stop us,'' said Gleason, who has 1,000 downloaded songs and adds five songs a week to that collection.

Twenty-seven file sharing networks came up in a Web search for services that have replaced Napster.

``Truth will come out when we find out who they're going to sue,'' said Gigi Sohn, president of a group that advocates balance in copyright laws.
http://www.bostonherald.com/business...ra06272003.htm


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Japan Grapples With Digital Shoplifting Using Mobiles
Agence France-Presse

Japanese publishers said on Monday that they will launch a campaign this week to stop digital shoplifters -- people who visit book stores to photograph magazine pages with their cellphones rather than make a purchase.

Digital shoplifting is becoming a big problem as camera-equipped mobile handsets are spreading fast and their quality is improving greatly, said an official at the Japan Magazine Publishers Association, Kenji Takahashi.

Starting Tuesday, bookstores across the nation will put up posters urging magazine readers to "refrain from recording information with camera-mounted cellphones and other devices."

The association has printed 30,000 posters for the campaign, which will last until August 20 in co-operation with bookstores and the Telecommunications Carriers Association.

There are 20,000 bookstores in Japan. Small operators are already hit hard by conventional theft and hundreds of them are closing down every year due to financial difficulties, Takahashi said.

"Given the enormous speed of business closures, we cannot overlook this information-lifting with cellphones," he said.

He said it was unclear if digital shoplifting is tantamount to a crime as the copyright law only covers use of information for commercial purposes.

The Telecommunications Carriers Association also "recognizes the need to improve people's mobile phone manners," an official said, as handsets become more advanced with new functions ranging from Internet access to sending and receiving e-mails and taking pictures.

The latest advertisement by the association, published in newspapers on Sunday, urged users not to write e-mails while walking.

There were 76.73 million mobile phone subscriptions at the end of May, according to the latest data from the telecom association.

J-Phone Co Ltd, controlled by British-based telecoms giant Vodafone, launched the world's first picture-taking handsets in November 2000.

More than half of mobile handsets shipped in the year ended March were estimated to be camera phones.
http://www.hindustantimes.com/news/181_294225,0003.htm


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'Cameraphones' Could Get Less Candid
Tak Sang-hun

Amid a bid by the Ministry of Information and Communication (MOIC) to regulate the use of cell phones with cameras installed - "cameraphones" - the National Assembly is expected to soon discuss a new bill tighten the use of such phones.

Huh Un-na, a ruling Millennium Democratic Party member on the Assembly's Science, Technology, Information and Telecommunications committee said that the party plans to submit a bill mandating that cameraphones be designed to emit a loud noise when photos are taken. The noise would alert people in public that their picture might have been taken.

Huh said the bill would require that mobile handset manufacturers install the noisemaker in cell phones, in order to prevent what she called "human rights infringements" and to prevent corporate espionage.

Meanwhile, an official at the MOIC said the ministry would start a comprehensive analysis to draft measures to stem the misuse of cameraphones in public places, including bath houses and dressing rooms.

The nation's leading cell phone manufacturers, however, expressed concern over the proposed regulation, as the businesses have been suffering from a sharp decline in domestic sales. An official at Samsung Electronics said that restrictions on the use of cameraphones would cause domestic sales of the phones, which is still struggling to get off the ground, to be stalled. Exports would also sink, he warned.
http://english.chosun.com/w21data/ht...306230022.html


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RealNetworks, Listen Sued for Patent Infringement

LOS ANGELES (Reuters) - Privately held Friskit Inc. on Tuesday said it had filed a patent infringement lawsuit against digital media software provider RealNetworks Inc (RNWK.O) and its online music unit, Listen.com. San Francisco-based Friskit, a technology licensing company, is seeking a permanent injunction that would prevent the two companies from using what it claims is its technology for streaming online media, which include Webcast sounds.
http://boston.com/dailynews/183/tech...rnet_fi:.shtml


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P2P Goes Corporate
Tiernan Ray

Peer-to-peer technology may have pulled off the greatest disappearing act of the post-dot-com era. Once heralded as the second coming of the Internet, file-sharing giant Napster was sued out of business, and many of its descendants, such as Kazaa and Morpheus, are under fire from the Recording Industry Association of America (RIAA).

Grizzled veterans of P2P technology, such as Andy Oram, editor of "Peer-to-Peer: Harnessing the Power of Disruptive Technologies," shake their heads in disappointment. "Honestly, I've felt for a while now like it was part of my past," Oram says of the technology he once passionately embraced.

Nonetheless, the innovations unleashed by Napster are making modest headway in corporate networks. For example, network administrators are discovering that distributing some file-sharing capabilities out to the edges of a network can make their workforce more versatile and mobile. Sun Microsystems has launched a set of P2P tools, as has IBM, though they have yet to catch fire in the marketplace.

Peer-based technologies may yet change the way corporate computing works. Just remember: Don't call it "P2P" when you are selling it to executives. That term is tainted.

Evaluating P2P in the enterprise is an ambiguous endeavor. What does the term really encompass? For some, the image of file-sharing programs like BearShare, Limewire and Napster is most prominent. For others, it is about "presence" -- the ability of a computer user to sense when a coworker may be on the network -- though that feature is more properly associated with instant messaging programs than with P2P. Still others might say P2P should promote distributed processing power within the enterprise, just as the SETI@HOME project uses volunteers' Pentiums to search for extraterrestrial life.

In fact, it turns out that the features commonly deemed most important about P2P -- decentralized file exchanges, non-hierarchical communications, direct collaboration and distributed processing power -- are rather unimportant to most corporate buyers. This dilemma is familiar to Ray Ozzie, formerly the brains behind the Lotus Notes program, who now runs P2P software venture Groove Networks. Lotus Notes offered sophisticated file sharing in an age before the World Wide Web, but most corporate customers ended up using it for little more than e-mail. Likewise, Groove is finding that the killer P2P app, collaboration, is not so killer.

"There's about 3 million lines of code in Groove, but it's the last 250,000 lines, the part that you use to develop applications internally, that matters to customers," Andrew Mahon, director of strategic marketing at Groove Networks, told the E-Commerce Times.

Groove Workspace, a peer-based file-sharing program, was a proof of concept built on top of the company's P2P toolkit, he said. Businesses can start using it for US$49 per seat, putting it within reach of even small companies. However, three pieces of application infrastructure have made the underlying Groove code libraries more important to users than Workspace itself. They are: synchronization of changes made to documents offline; the ability to apply strong encryption to files with sensitive content; and the ability for remote workers to connect to the enterprise through virtual private networks.

One prominent Groove customer said those three factors are exactly why he implemented the software. Craig Samuel is chief knowledge officer in charge of information sharing among the 65,000 employees in Hewlett-Packard's services division, which is spread across 160 countries. "The business problem we try to solve internally is, how do you get large organizations around the world to access and share the right knowledge in a very responsive way?" Samuel told the E-Commerce Times.

For HP, Samuel said, achieving this goal meant integrating peer-to-peer technology with the Web-based Sharepoint package used widely throughout the company, which in turn required using Groove's capabilities as modules to be plugged into Sharepoint. "We wanted to be able to not just share information around the periphery of the organization," as in Napster-style file sharing, "but also to connect that to centralized programs." Specifically, Groove offered a better way to synchronize data than Microsoft Outlook, according to Samuel, and it was an easy way to add 192-bit encryption to file sharing.

As a customer since version 1.0, HP's experience helped shape Groove. "In the beginning, Groove was just a nice collaboration tool," Samuel said. "Now, people can work together in a common space, in portals, and push content between different repositories. That's been the key" to making Groove a productivity enhancer. In the future, he added, HP may build more complex applications on top of Groove using Microsoft's Visual Studio .NET.

However, although Groove is cherished by some customers for offline synchronization, its popularity only highlights the shortcomings that hobble P2P in general. P2P guru Oram said file-sharing programs and the like have "serious problems."

"There are three things that P2P really lacks, namely a consistent addressing scheme, metadata and a way to ensure the reputation of participants in the network," he told the E-Commerce Times. Because of those shortcomings, "right now, it's hard to say P2P makes things better for the end user; it makes things more difficult."

On the first point, Oram noted that although the presence features of Jabber, an instant messaging program, are good, he would like to see a consistent protocol for finding and addressing P2P participants, akin to plain old e-mail addresses. He added that he thinks metadata is needed to replace the unstructured, stream-of-consciousness nature of instant messaging with an organized method of exchanging complex documents. Lastly, Oram argued that as P2P technology moves beyond stealing music, there must be a way to validate the reputation and trustworthiness of users participating in the network.

Others agree that beneath all the fluff about P2P, today's programs are immature. "There are mixed emotions about this in IT," said Bob Parker, an analyst at AMR Research. He told the E-Commerce Times that although peer-based software can be an effective tool for ad-hoc collaboration, companies are worried that they will not be able to properly archive materials traded back and forth among peers.

"Any communication in a bank related to an equity that might be traded comes under purview of [the] SEC, and that needs to be archived," Parker said. Of course, third-party tools can be added, but "out of the box, P2P has these archival issues." He agreed with Oram about the issue of addressing, to say nothing of the headaches created on networks flooded with decentralized file sharing.

However, if companies like Groove can succeed despite the pressing issues surrounding peer-to-peer technology, one can only conclude that P2P has not been rejected by the market. Far from it. The technology appears to be finding a niche by addressing existing communication issues in enterprise computing. Such unglamorous hacks used to be called "middleware," a kind of software piping sold by established companies like IBM.

However, Groove's Mahon eschews that label, not least because it threatens to pull Groove into Microsoft's rapacious maw as the software giant seeks to incorporate more middleware into Windows. (Microsoft has an investment in Groove.) Instead, Mahon is stumping for the liberating power of the technology. He believes that, like Napster, Groove brings a little bit of an anarchic quality to the way an increasingly mobile and connected staff functions inside the Fortune 500.

"Users want to just work together without having to have permission, just as they do with e-mail," he said. "Groove lets IT maintain control over policy, while users can control the content that gets exchanged." That may be a good enough selling point for executives -- so long as they are not spooked by visions of illicit file swapping.
http://www.ecommercetimes.com/perl/story/21742.html


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Tadpole Seeks Strategic Partner To Offset Losses
Chris Lake

Peer to peer software developer Tadpole Technology said it is seeking a strategic partner to help it market its instant messaging and collaboration products, to help combat continued losses.

The company, which offloaded its hardware division towards the end of 2002, is now focused purely on software and hopes to improve sales of Endeavors products. It has decided to cash in quickly on the sale of the hardware unit - Tadpole was due to recieve $8.5m in 2007 but has instead realised just $2m from the sale after signing an agreement earlier this week. This has resulted in a write off of more than £4m, but has given Tadpole some much-needed cash, to allow it to hold off from drawing down cash from the equity line of credit it has in place with GEM. It has used almost £5m of the £10m GEM facility, which expires in January, and did not rule out further drawdowns.

Endeavors has developed peer to peer software and secure corporate instant messaging applications that transform AIM and MSN from standalone IM platforms into interoperable ones.But sales at Endeavors have been disappointing, reaping just £50,000 for Tadpole in the six months to 31 March, although this is a seven-fold increase on the same period last year.

Endeavors remains at an early-stage in its development but now it has market-ready software products, Tadpole should benefit from sales growth in the coming months and years, though current market conditions were described as "challenging".

The company has completed a strategic review and reduced headcount at Endeavors to reduce operating costs by £300,000 to £1.9m. Crucially, the company is actively seeking out a strategic partner to help exploit Endeavors' technology.

Overall, Tadpole reported a £600,000 reduction in operating costs to £2.6m. Sales were flat, at £1.1m, and the loss made from cashing in early on the hardware division forced overall losses up to £7.5m, from £2.8m last year.

Worryingly, the company now has net current liabilities of £168,000, but the equity line of credit from GEM and cash from the hardware sale will buy Tadpole vital time.

If it can add a high profile strategic partner to its Endeavors division then the shift from development to sales and marketing will be complete, but it needs to quickly increase sales if it is to breakeven before it runs out of funds.

Tadpole said it expects to report a "substantially reduced operating loss" in the second half of the year.
http://www.netimperative.com/cmn/vie...ews_0000054411


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Grokster Blasts RIAA Anti-Piracy Tactics
Brian Garrity

The Recording Industry Association of America's plan to sue individuals for distributing "substantial amounts" of music files on peer-to-peer networks isn't likely to change consumer behavior, critics of the initiative charge.

Grokster president Wayne Rosso told attendees of an event sponsored by the Copyright Society of the USA yesterday (June 26) in New York that attempts by the recording industry to thwart file sharing through litigation are bound to fail. Rosso said lawsuits can't keep pace with technological innovation and development.

RIAA attorney Dean Garfield told attendees that lawsuits against consumers are just one tactic in a multi-faceted strategy the industry is using to combat piracy.

The move comes after litigation aimed at P2P networks themselves has failed to stem the growth of file sharing. Two years after the industry's shutdown of Napster, the practice is more popular than ever. The RIAA reports that an estimated 2.6 billion copyrighted files are traded over P2P networks every month. Leading the pack is KaZaA: The RIAA says that in May, the service had more than 230 million users, up from 100 million in July 2002.

Additionally, a recent court ruling in the RIAA's suit against Grokster and others found that P2P networks cannot necessarily by held accountable for the illegal activities of their users.

Rosso said the only real solution is for labels to strike distribution deals with P2P networks. However, he said, the RIAA's litigation initiatives are stifling negotiations.
http://www.billboard.com/bb/daily/ar...ent_id=1923806


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Napster Plans Ad Push for Comeback
Brian Morrissey

Napster, the deceased file-sharing network, announced on Thursday that it hired ad agency Venables, Bell & Partners to design a promotional campaign for its re-launch set for sometime in the next eight to 10 months.

MediaSmith, a San Francisco-based company that handles the same duties for Napster parent company Roxio, will complement the Venables campaign. Napster declined to give any further details on its ad plans, citing "competitive reasons."

The announcement comes a month after Roxio paid about $40 million to acquire online music service Pressplay, a joint venture of Universal Music Group and Sony Music Entertainment. Roxo plans to use Pressplay's infrastructure and the Napster brand to build a legitimate and viable online music offering. It said it would earmark $20 million to the re- introduction of the new Napster. Venables was about to be named Pressplay's agency of record at the time of its acquisition, according to press reports.

Venables will have its work cut out for it. Although Napster retains a strong brand name in the public imagination, it has not operated for the past two years. By the time it re- launches in 2004, the online service will have been offline for nearly three years.

"It really needs to do some re-imaging and repositioning because what people grew to love about Napster will change when it moves to a pay service," said Lee Black, an online music industry analyst for Jupiter Research, which is owned by the parent company of this site. "It's about moving that name recognition into familiarity with the new Napster."

Since its demise at the hands of the recording industry's legal assault, a number of online music services have sprung up to take its place. Listen.com's Rhapsody, which Real Networks plans to buy to replace MusicNet, capitalized on the Napster phenomenon, while Apple Computer also now sells songs at its iTunes online store. In addition, a number of other peer-to-peer networks, such as Kazaa and Morpheus, have grown in popularity for music fans looking to trade MP3s.

Still, Roxio saw value in the strong brand Napster built during its short life. Last November, it shelled out $5.3 million to buy Napster's assets from a bankruptcy court, and four months ago it announced plans to re-launch it as an online music service, albeit one that operates legally. The new service will be a client-server application, eschewing Napster's peer-to-peer roots.
www.atnewyork.com/news/article.php/2228481


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Coming Soon: A Horror Show for TV Ads
Jane Black

TiVo's digital recorders indicate that viewers don't necessarily watch the ads, even on hit shows. Agencies and networks are still in denial
"I know that 50% of my advertising is wasted. I just don't know which half," retail guru John Wanamaker famously quipped in 1886. Things haven't improved much since then. Magazines and newspapers still sell ads based on circulation, and TV networks have sold ads based on viewer ratings for the last 50 years, even though no one knows whether anyone actually watches commercials. More than a century after Wanamaker's lament, advertising remains as much an art as a science.

Yet the world of TV advertising is about to become a lot more scientific. On June 2, personal-video-recorder outfit TiVo (TIVO ) unveiled an analytical tool that can tell advertisers, agencies, and networks not only how many people tune in for a show but whether they're watching the ads. Unlike a Nielsen rating, which relies on surveys filled out by viewers, TiVo's system tracks what a viewer records and tunes into, even when the channel is changed -- although, thankfully, it still doesn't know if you head for the kitchen for something to eat.

UNWELCOME FINDINGS. TiVo can also pinpoint where and when ads are watched the most. For example, a commercial for breakfast cereal might be skipped through less often in the morning on the West Coast than during pricey prime-time slots in the East. "This is the beginning of the end of that drunken orgy of dollars spent on broadcast TV as the ultimate 'reach' vehicle," says Tim Hanlon, vice-president for emerging contacts at Starcom MediaVest, an ad agency that helped TiVo design its new service.

Perhaps. But the ad industry's response has been anything but ecstatic. In the weeks since TiVo threw down the gauntlet, it has become clear that the burning question of which half of advertising is wasted isn't something that ad giants, such as Interpublic (IPG ) or the big three networks necessarily want answered -- especially in the network-TV market, where ad prices continue to rise, despite falling viewer ratings. "This kind of information is the holy grail for marketers. But it's not the holy grail for advertising agencies and media companies, which have built an industry around the idea of getting a shallow message to a broad audience rather than a tailored message to a narrower one," says Mike Galgon, chief strategy officer at Seattle-based interactive ad agency Avenue A (AQNT ).

Galgon would know. Over the last seven years, Avenue A and other interactive agencies such as DoubleClick (DCLK ) have struggled to legitimize online advertising -- the ultimate in accountable media. In the heyday of the late 1990s, successful Web portals such as AOL and Yahoo! (YHOO ) sold inventory based on the number of unique users visiting their sites. That model mimicked TV: The more "viewers" you could deliver, the more you could charge.

Then, in 2000, the bubble burst. Advertisers stopped caring whether 2 million or 20 million people visited a site. Instead, they demanded to know how many people clicked on their ads -- or how many saw the ad and subsequently bought something. "Accountability is a huge challenge for everyone who's buying TV," says Galgon. Now, "all of a sudden [TV] looks a lot like the Internet."

SMALLER, "STICKIER" VIEWERSHIP? Indeed, just like clickable ads, TiVo's initial data reveal some trends that ad agencies and networks might prefer to bury. For one, a program's rating -- the number of people saying they watched a TV show at a given time -- appears to have an inverse relationship with the proportion of ads viewed. On April 11, 2002, ABC's popular TV drama The Practice drew a TiVo rating of 8.9, meaning 8.9% of TiVo owners watched the show live or recorded it and watched it later. But those viewers watched just 30% of the ads shown. Meanwhile, quiz show The Weakest Link, drew a rating of 0.9, but viewers watched 78% of the commercials. TV news magazine 60 Minutes got only a 2.2 rating, but its viewers sat through 73% of the ads.

Certain genres are "stickier" than others, TiVo's research shows. Big-budget situation comedies and dramas tend to have the lowest retention and commercial-viewing rate because couch potatoes tend to record them and skip through the commercials rather than watch them live. Reality TV, news, and "event" programming such as the Oscars do significantly better at getting viewers to see the commercials. Just 39% of viewers watched ads during the highest-rated network TV show, Friends, vs. 75% for the 45th Annual Grammy Awards and 58% for Fox reality show Fear Factor.

These trends don't threaten to kill TV advertising, but they're sure to change how ads are produced and sold. Today, media buyers purchase TV ad time based on program ratings and demographics. When 2 million people turn in to watch Friends on Thursday night at 8 p.m., advertisers assume 2 million people see their ad. Tomorrow's ad buyers might choose to bid higher for 30-second spots on programs such as 60 Minutes, which has an older audience less prone to channel surfing.

RESHUFFLING AD DOLLARS. Advertisers trying to reach younger people will shift their spending to more appropriate channels. According to Forrester Research, when personal-video-recorder (PVR) technology reaches 30 million households in 2006, 76% of advertisers say they'll cut their TV ad spending -- one quarter of them by more than 41%. Instead of buying TV ads, 65% plan to spend more on program sponsorship, 46% will increase budgets for product placement, and 36% say they'll rechannel their dollars to online advertising.

TV's transformation will surely take time. Right now, most ad agencies and network execs are in a state of deep denial about the wrenching change on the horizon. Ad execs by and large dismiss TiVo's data, saying the sample size is too small -- Tivo has just 750,000 customers -- and arguing that these users represent an early-adopter set, not the mass market. "You pour money in where it's going to work," says Lisa Seiwers, director of national broadcast at New York agency Tucker, Hampel & Stephanides. "TV still remains the most mass reach you can get in terms of advertising."

Or is it? Data collected by TiVo and other PVR outfits are certain to challenge the prevailing wisdom and the status quo. Forrester predicts that by 2007, half of American households will have either a PVR or other on-demand services that allow viewers to watch TV programs at their convenience. As PVRs become more prevalent, the data will become increasingly difficult to ignore.

It's easy to sell ads when advertisers don't know which half of their money is being wasted. But if the technology exists to figure it out, you can be sure they'll demand to know.
http://www.businessweek.com/technolo...1133_tc119.htm


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Urban Spying System Would Eye Vehicles
AP

The Pentagon is developing an urban surveillance system that would use computers and thousands of cameras to track, record and analyze the movement of every vehicle in a foreign city.

Dubbed "Combat Zones That See," the project is designed to help the U.S. military protect troops and fight in cities overseas.

Police, scientists and privacy experts say the unclassified technology could easily be adapted to spy on Americans.
http://www.latimes.com/technology/la...nes-technology


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Labels May Face Risk in Piracy Suits
Jon Healey

As the record industry prepares to haul thousands of alleged music pirates into court, its biggest risk may be suing the wrong people — and losing the support of leading members of Congress in the process.

Labels and artists are widely viewed on Capitol Hill as victims of rampant piracy by millions of users of file-sharing networks. And anonymous file sharers are easy to demonize.

But the real people sued this fall by the Recording Industry Assn. of America may have sympathetic stories to tell. That could turn sentiment on Capitol Hill at a time when some lawmakers are eager to narrow the reach of copyright law and expand consumer rights.

"I would guess that you would then see stories about the family faced with economic ruin and the cost of having to hire defense counsel, settling for $10,000 or $20,000, and the money they were saving for Timmy's college education now has to go to Kid Rock," said Philip S. Corwin, a lobbyist in Washington for Sharman Networks, distributor of the Kazaa file-sharing software.

"That's the kind of stuff that would scare a politician."

Even Rep. Howard L. Berman (D-North Hollywood), a frequent ally of the entertainment industry, said the labels' standing in Congress would suffer if they "overreach and refuse to settle these issues reasonably." But, he added, "I don't think their goal is to collect a huge amount of revenue through the vehicle of lawsuits; I think it is to deter continued illegal conduct."

The RIAA can identify which computers are sharing songs, but it can't easily tell who's using them. The people it sues will be the ones who pay to connect those computers to the Internet, and could be unwitting parents and employers.

"Nobody wants to be the heavy," RIAA President Cary Sherman said. "Everybody is aware that there could be poster children. But the alternative, which is to do nothing about a problem which is getting worse that's much worse."

The RIAA plans to start by suing the several hundred "worst offenders," hoping that the opening salvo will deter the masses from sharing copyrighted songs. If it doesn't, Sherman said, the lawsuits will continue.

File-sharing networks attract an estimated 57 million Americans and about 80 million users worldwide, with Kazaa alone drawing at least 4 million people sharing more than 800 million songs, movies and other digital files at any given moment.

The rise of those networks has coincided with a decline in CD sales, which have fallen more than 25% since Napster Inc. debuted in 1999.

The one bright spot for the RIAA is that its educational efforts may be making some headway — 50% of the 12- to 44-year-olds surveyed by Edison Media Research in May said it's wrong to download songs for free, compared with 39% last year.

The combination of relentless piracy and the labels' increased support for legitimate sources of music online has driven up the music industry's stock on Capitol Hill. "There's strong recognition that what's been going on in these file-swapping systems is theft, and there is an injured party, and it is the people who create and record and distribute music," Berman said.

That sympathy is important because the RIAA has largely been playing defense in Washington, trying to block proposals that would weaken the anti- piracy tools in copyright law.

Examples include a new proposal from Sen. Sam Brownback (R-Kan.) that would make it harder for copyright holders to obtain the identities of alleged infringers from their Internet service providers, a change that would put a significant hurdle in front of the RIAA's lawsuit campaign. The draft bill, which Brownback has yet to introduce, also would guarantee consumers' ability to sell or donate the downloadable songs, movies and other digital media they buy.

Gigi Sohn of Public Knowledge, an advocacy group that's trying to rein in copyright law, said the record labels' campaign could backfire if they "start to go after the smaller fry" on file-sharing networks or "if they just pick the wrong person, like a congressman's daughter or son."

And if they mistakenly target someone who's not violated any copyrights, as the labels and movie studios have done occasionally when sending out cease-and-desist letters, that may sink the entire campaign, Sohn said.

Rep. Rick Boucher (D-Va.), sponsor of a bill to let consumers make personal copies of digital media, said the RIAA could cause a backlash simply by suing too many people. "There will be political ramifications from vast numbers of lawsuits being filed."

On the other hand, Berman said, lawmakers may have little trouble supporting lawsuits against constituents who violate copyrights, or suits brought against their parents.

"If a constituent called me and said, 'My kid got picked up for shoplifting. You've got to change the shoplifting law.' I'd say, 'Tell your kid to stop shoplifting.' And I think this is somewhat analogous."

Rep. Chris Cannon (R-Utah), a frequent critic of the record labels, said in this instance the RIAA has a good message: "The purpose here is to get people aware of this underlying truth: Stealing is stealing, whether it's a hard good or software."
http://www.latimes.com/technology/la...,5959080.story


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NewsHour

The Federal Communications Commission late Wednesday published its final report on the revised media ownership rules, even as lawmakers and consumer rights groups announced various plans aimed at making sure the new rules never take effect.

Read the entire FCC report on media concentration. (MS Word)
http://www.pbs.org/newshour/media/conglomeration/


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Here’s To Internet Piracy And The New Artistic Renaissance.
Ed Weathers

Why did Homer write the Iliad and the Odyssey? Why did Chaucer write The Canterbury Tales and John Milton Paradise Lost? Why did Emily Dickinson write her poems? Why did the unknown composer of “The Londonderry Air” (better known as the tune of “Danny Boy”) go to the trouble of writing a song at all? Why did Mozart compose and compose in a frenzy of creativity even when he knew it wouldn’t solve his money problems? Why did Van Gogh continue to make paintings that would never make him a living?

I’ve been preoccupied with questions like these ever since Napster first came to light. Napster, of course, was the original music-sharing software, which allowed anyone with a computer to go online and make a perfect digital copy of a song, for nothing, by transferring the song-file data from the CD of someone who owned it.

This is what I hope will happen: Those who, like the RIAA and the MPAA, are trying to put roadblocks around the Internet will fail. The programmers and the kids (often one and the same) will stay a step ahead of them. Finally, the Internet police will give up. As a result, within ten, at most twenty years, every form of art that can be digitized--every song, every movie, every book--will be available for free to everyone who owns a computer. The recording, movie and book distribution industries as we know them will collapse, though there will continue to be a cottage industry for those who, driven by nostalgia, demand actual vinyl records and paper books, or want to watch movies in large groups at movie theaters instead of in their own, far superior, home entertainment centers. Art that cannot be digitized and passed through wires or the ether, such as sculpture and painting, will flourish, in part because of the very fact that it cannot be translated by Booean algebra and is therefore extra-special. Art that depends on live performances--rock concerts, live theater, novel and poetry readings--will likewise flourish, and that’s how most singers, actors and writers will make their livings. Finally, art itself will be more malleable than ever, since every digitized novel can be re-edited instantly by anyone who receives it on his computer, and every song changed to suit the listener--much as those who recited the Iliad modified it with each retelling, often, I suspect, improving it. This audience-editing, of course, is already happening and can never be stopped.

What about the poor artists? They will continue to create art. Why? For the same reasons Homer and Emily Dickinson and Mozart did: because they want to be famous or because they need to be heard or because they have something they need to say or sing, or because, well, they just can’t help it. Maybe they’ll have full-time jobs doing something else, like selling insurance or folding pretzels, and will be artists on the side. Maybe the U.S. government will actually support artists seriously, for a change, as other governments do around the world. Or maybe artists will rely on patrons to support them, as Michelangelo relied on the Medicis in Renaissance Florence.

Speaking of the Renaissance, I also think this: In the end, the music we hear and the movies we see and the books we read will be all the better for their digital availability. No longer will music, movies and books be the products of greed. Now they’ll be the products of need--the need of the artist to make something special, so special that bits and bites, zeroes and ones, cannot reduce it to anything less than art, and the money it makes is not part of its specialness. There is something in the act of artistic creation so satisfying, so far beyond the satisfaction of a full bank account, that we don’t need to worry that the rock bands or the novelists or the filmmakers will go away. Those who write potboilers just to make money (Tom Clancy? John Grisham?) and those who make bad music and bad movies with nothing but an eye to the bottom line (The Backstreet Boys? 2 Fast 2 Furious?) will probably go away forever. To which we can all say: Good riddance.

In ten years, maybe twenty at the most, the truer, purer artists will once again take center stage. And then we can all say:

Welcome home, Homer.
http://www.memphisflyer.com/onthefly...ew.asp?ID=2444


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Computer Users Urged To Take Music Industry Lawsuits Seriously
Ken Seeber

It could be several weeks before record companies begin filing their planned lawsuits against people who download copyrighted music over the Internet. But a lawyer who provides legal advice to students at Southern Illinois University Carbondale said people should take the music industry's latest anti-piracy campaign seriously.

The Recording Industry Association of America, the Washington lobbying group that represents the interests of the major record labels, announced plans Wednesday to more aggressively combat so-called peer-to-peer file sharing of copyrighted music.

Instead of targeting the software companies that make such activity possible, the RIAA plans to file several hundred lawsuits in the coming weeks against individual computer users who illegally share music files online.

"There's not a very large body of case law in this area at this point as to what legal rights the (record) companies have against the users of these (file sharing) sites, but I would think it's likely that the courts would side in the favor of the companies and enter judgments against these people," said Steve Rogers, a lawyer with the Students' Legal Assistance Office at SIUC. "Better to be safe than sorry."

File sharing used to take place through centralized computer servers, such as Napster, which made such services easy targets for the RIAA. But since the music industry successfully shut Napster down, file sharing has evolved into decentralized "peer-to-peer" networks such as Kazaa and Grokster.

The RIAA claims such file sharing is responsible for a 26 percent decline in recorded music sales over the last three years.

Not all musicians agree with the RIAA's decision to sue music fans.

"I think it's unconscionable," said Peter Mulvey, a Milwaukee-based singer/ songwriter. Mulvey has recorded several albums and regularly posts mp3s of his music on his Web site, www.petermulvey.com.

"I understand that an artist's got to get paid, and really should get paid for his work, and I understand the concept of intellectual property," Mulvey said. "But at the same time, the actions of the record labels over the last 30 years has been to suck the musicality out of things and to increase profits, and to in no way encourage artists to put out great songs.

"For them to come around now and say this thunderbolt out of the blue is what's wrecking music is hypocrisy," he added.
http://www.southernillinoisan.com/re...op/TOP003.html


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Online File Sharing Thrives in USA

comScore Networks reports that despite growth in most sectors of consumer e-commerce, online sales of recorded music in the USA have continued to decline sharply for three consecutive quarters. At the same time, millions of Internet users continue to use online file-sharing services even as some of these applications have vanished.

The comScore analysis - based on the actual online activity of more than 1.5 million representative Internet users - shows that 2002 online music sales through the third quarter were $545 million, down 25 percent from the $730 million spent over the same period last year. In fact, the decline in online sales of recorded music has accelerated throughout 2002, with sales declining versus year-ago by 12 percent, 28 percent and 39 percent in the first, second and third quarters of 2002, respectively. In contrast, online sales of all products (excluding auctions) increased 30 percent, 28 percent and 30 percent over the same three quarters.

The decline in online music sales far exceeds the decline in overall shipments of recorded music as recently reported by PricewaterhouseCoopers for the Recording Industry Association of America (RIAA). While the RIAA reported in August 2002 that total U.S. music shipments dropped seven percent in the first half of 2002 versus the first half of 2001 ($5.93 billion versus $5.53 billion), comScore data shows that online sales of music fell 20 percent (from $531 million to $424 million) over the same period.

‘The music industry attributes the decline in online and offline music sales to a variety of factors, such as a slow economy, fewer hit songs, piracy, CD-burning and file-swapping among others,’ said Peter Daboll, division president of comScore Media Metrix, a division of comScore Networks. ‘While a host of factors inevitably impact consumer behaviour, the greater sales decline online as reported by comScore would suggest that Internet file-swapping and CD-burning are having a severe negative impact on music sales among Internet users.’

After the fall of legendary file-swapping pioneer Napster, comScore data shows that U.S. consumers quickly flocked to numerous alternatives, including Kazaa and Morpheus. Each of the latter two increased its average monthly U.S. home user base from less than one million in the second quarter of 2001 to 4.6 million and 7.1 million, respectively, in the first quarter of 2002. By the close of the third quarter of 2002, Kazaa had built an impressive following of 9.4 million average monthly U.S. home users.

‘comScore Media Metrix will continue to report online purchases of music as well as usage of file- swapping,’ concluded Daboll. ‘In addition, we'll be conducting more in-depth analyses and looking at key online segments such as the university population, an audience which our data show contains many heavy users of file-swapping services.’
http://www.mrons.com/drno/news1980.htm


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BMG Tinkers With CD Copy Controls
Richard Shim

Music label BMG said Monday that it has licensed new technology from SunnComm Technologies aimed at preventing legal music buyers from making unlimited digital copies of songs from its CDs.

The Bertelesmann AG division, which produces contemporary artists including Norah Jones, Avril Lavigne and No Doubt, said it plans to begin selling CDs in the United States protected with SunnComm's MediaMax CD-3 product.

The software lets listeners transfer music from a CD to a computer but prevents them from then distributing that music to file-sharing services. It also allows music companies to include extras on the disc, such as artist information, song lyrics, bonus tracks, video clips and special offers.

Songs on a MediaMax CD can be uploaded only three times, and software built into the disc prevents listeners from copying or sharing the music. BMG music CDs using MediaMax will be available immediately in the U.S. market.

BMG has been one of the more aggressive music labels in trying to block the copying of its CDs. The Monday announcement with SunnComm suggests that the company, like other labels, is looking for ways to give listeners freedom in how they listen to music while keeping them from distributing it illegally.

"We're seeing music labels and technology providers search for a middle ground in appeasing consumers while protecting their content," IDC analyst Susan Kevorkian said.

Other labels have worked to prevent the distribution of digital music with limited success. Hackers have found ways to get around high-tech blocking systems, sometimes through such low-tech means as black markers and Post-It Notes.

The agreement is a multiyear deal, but the companies did not give further details.
http://news.com.com/2100-1027-1022369.html


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Consumer Sues Label Over Copy Protected CD – And Wins

Translation from South American Source:

Noise: Consumer Gains Action For "Tribalistas"
Peter Alexander Sanches

The Carioca consumer Pablo Enrique Andrade was successful, in lower court, an action against the producing company of Marisa Mount, recording EMI and the Sony plant, for having supposedly been injured in the purchase of the COMPACT DISC "Tribalistas".

Andrade affirms that its record, bought legally, did not function in touches- CDs of its car, also acquired of regular form. A device antipiracy of the COMPACT DISC would be the cause.

6º Civil Special Court of the River determined that the companies change the copy and pay indemnity of R$ 1,000 to the consumer. EMI already appealed.

If confirmed, the sentence would generate jurisprudence for that if they oppose to the technology of "controlled copies", already incorporated by EMI in all its launchings, with the objective to inhibit illegal copies of its records for computer.

The vice-president of EMI, Bannitz Luiz, affirms that she is inevitable will happen problems in situations of implantation of new technologies. "the consumer complains, we changes the product. But it is lamentable that certain people use this as extortion form ", complains.

Marisa Mount, owner of the Phonomotor stamp, that launched the COMPACT DISC, keeps silence on the case.
http://babelfish.altavista.com/babel...90u34467.shtml


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Harry Potter and the International Order of Copyright

Should Tanya Grotter and the Magic Double Bass be banned?
Tim Wu

If you're a serious Harry Potter fan, you finished The Order of the Phoenix over the weekend and are already impatient for the sixth book. While you wait (and wait) for it, how about trying some of the international versions of Potter? In China last year, it was easy to buy the unusual Potter sequel Harry Potter and Leopard-Walk-Up-to-Dragon, in which Harry encountered sweet and sour rain, became a hairy troll, and joined Gandalf to re- enact scenes from The Hobbit. The book, while credited to J.K. Rowling, wasn't authorized or written by her, but that didn't prevent it from selling like butterbeer.

Meanwhile, in Russia, you can still meet Harry's Slavic twin: "Tanya Grotter," star of Tanya Grotter and the Magic Double Bass. Tanya rides a double bass, sports a mole instead of a bolt of lightning, and attends the Tibidokhs School of Magic. In an interview with journalist Steve Gutterman, author Dmitry Yemets called her "a sort of Russian answer to Harry Potter," and described his books as "cultural competition" for the original. Grotter is a hit: Yemets has already sold more than 1 million copies. And next door in Belarus you'll find Porri Gatter and the Stone Philosopher. In something of a departure, Harry's Belarussian clone wields a grenade launcher and re-fights the White Russian wars.

You're unlikely to be able to get your hands on any of these works, since J.K. Rowling and her publisher have launched an aggressive worldwide legal campaign against the unauthorized Potter takeoffs. It began last year when Rowling and Time-Warner threatened the publishers of Chinese Potter, who agreed to stop publication. On April 4 of this year, Rowling persuaded a Dutch court to block the import of Tanya Grotter to Holland. Harry Potter in Calcutta, in which Harry meets up with various characters from Bengali literature, was recently pulled by its Indian publisher under threat. Potter takeoffs have become international contraband.

Rowling's ability to stop the Potter pretenders is largely a function of the new regime of international copyright. Until recently, countries varied considerably in how they protected literary works, especially works from abroad. The United States, for instance, has a long history of providing less protection than the Europeans. Benjamin Franklin was a kind of pirate: He did good business as a printer of unlicensed English writing. In the 19th century, the United States generally refused to recognize foreign copyrights, allowing American readers to get the latest Dickens and Doyle cheaply. And the borrowing of characters itself has a longer tradition. For example, the princess we know as Cinderella originally hails from China, where she goes by the name Yeh-Shen and relies for help on a magic fish who gives her golden slippers.

Today, nations still maintain and enforce their own copyright laws, but for members of the World Trade Organization (that is, nearly everyone that matters), those statutes must meet extensive minimum standards. Under the Trade Related International Property treaty, original authors "enjoy the exclusive right of authorizing adaptations, arrangements and other alterations of their works." In other words, there is little scope for secondary authors to write local adaptations of the Potter-clone variety, since their country must abide by the international norms guaranteeing Rowling's monopoly everywhere. The result: Rowling can use the courts in WTO-compliant countries to club her Potter rivals.

You might think it a good thing that Rowling can stop the Potter cloning industry, whether it is in Brighton, Bangalore, or Bratislava. Who wants to see Harry turned into a hairy troll or forced to gallivant with foreign literary figures? But on closer examination the argument for letting Potter crush his international competition is quite weak.

The case for preventing literal copying—in which a foreign publisher simply reprints a work without permission—is strong. But Potter follow-ons are different from the American Dickens piracy of the 19th century and DVD piracy of today. Literal copies are what come out when you use a photocopier. Potter's takeoffs are different: They either borrow characters and put them in a new, foreign context (Potter in Calcutta) or just use the themes and ideas of Potter (as in Tanya Grotter's case) as inspiration for a different kind of story. They aren't a direct replacement for a Potter book, the way a literal copy is, but rather a supplement or an adaptation.

One of the main justifications for a unified and strong global copyright system is that it is supposed to facilitate international trade. That's why it's a part of the WTO system. But as trade economists will tell you, trade often works when countries imitate and improve the inventions of others. America invents the hi-fi, Sony turns it into the Walkman, and then Chinese companies make still cheaper imitations.

This is basically what's going on in the world of Harry Potter. The English original is clearly the best. The imitators aren't as good but are cheaper and come out much more frequently (there are already three Tanya Grotter books). There is, in short, a secondary Potter market. Isn't this the international trading system at its best?

Moreover, the writers of secondary Potters are probably better at creating versions of Potter suited to local conditions. According to Reuters, at least some Russian children prefer Tanya Grotter to Harry, some on account of her Russian name. Local writers do things to Harry that Rowling can't, like introducing him to local literary figures and putting him in local wars. It may be good and it may be bad, but it's a market failure to prevent it.

Potter's publishers, in defense of strong global copyright, would say that works like Tanya Grotter are theft, and such theft destroys the incentive to write in the first place. But the incentives argument is surprisingly unpersuasive in the international setting. To say Rowling will stop writing for fear of international parody is a difficult case to make. Only the most famous and lucrative works are parodied overseas. If an international adaptation is a sign you've made it rich, how can it be a serious financial deterrent for new writers?

The truer complaint is that Potter's overseas competitors may mean slightly less profit for Rowling and her publishers. It is also true that Burger King means slightly less profit for McDonald's. You could say that Burger King and Wendy's stole the idea of a fun, plastic burger joint from McDonald's and are unfairly profiting from their evil deed. But when it comes to burger joints, we accept that the consequence of a competitive market is less profit for the first mover (McDonald's). Copyright should be no different. So long as it provides Rowling sufficient incentive to write, it should strive to maintain as much competition and facilitate as much international trade as possible.

It is also true that these rip-off works make authors angry and may tarnish the reputation of the character. But what makes authors angry is precisely what they are least likely to write, and therefore often what copyright needs to permit. For example, in 1989 the rap group 2 Live Crew recorded an obscene version of Roy Orbison's song "Pretty Woman." Orbison's "Pretty Woman" became, successively, "big hairy woman," "bald woman," and eventually, "two-timin' woman." There was little question that it made Orbison's estate angry, tarred the reputation of the original, and was a commercial competitor that threatened Orbison's profits. But the U.S. Supreme Court found it a parody: a non-infringing fair use. The faux Potter books are not quite parodies, but they're similar. Just as refusing 2 Live Crew permission to parody would have destroyed the market for parodies (since authors rarely parody their own works), so Rowling's campaign destroys the market for international follow-ons, since Rowling could never write a Potter book that could capture the Russian spirit the way Grotter does. Rowling is using the cudgel of international copyright not to destroy something she could have created, but to destroy something she could never create.

In the end, few people are likely to mistake Tanya Grotter for Harry Potter; it is akin to mistaking Burger King for McDonald's. The international copyright system is justified in preventing the most basic forms of piracy. But it doesn't need to stop works like Tanya Grotter. The original Harry Potter is good enough to compete with its foreign cousins. So let a hundred Harrys bloom and let a hundred schools of magic contend.
http://slate.msn.com/id/2084960/


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Overheard

Participant: Isn’t cyberspace just like the ocean—meaning there is no real jurisdiction?

Larry: Are you a lawyer?

Participant: Yes.

Larry: So this is a standard way to think about this. But here’s the difference between the Internet and the sea. When you’re in the ocean, you’re not in France at the same time.
http://www.copyfight.org/


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So Sue Me, Teens Tell Music Biz
Howard Cohen

Many South Florida music downloaders reacted with a scoff to the music industry's newest threat to sue individual users of music-trading software.

''How are they going to sue every teenager in America?,'' asks Lucia Goyen, 17, of Sunny Isles Beach, who says she buys CDs but also downloads dozens of songs for free and has friends who download hundreds more.

The threat is real, however.

On Wednesday, the music industry's chief trade group, the Recording Industry Association of America (RIAA), pledged that it is ''taking names'' of illegal downloaders and could soon begin preparing civil lawsuits against them.

''Too many computer users don't think there is anything wrong with downloading music that doesn't belong to them -- they are mistaken,'' Cary Sherman, president of the RIAA, said during a teleconference.

Local music fans cite many reasons for downloading versus buying CDs:

• The discs are overpriced (list price is now up to $19.98 for some titles. Record companies say they need to cover costs, overhead, etc.) )

• Labels stopped issuing commercial singles to force sales of full albums, losing a generation of consumers .

• The quality of the music itself is also perceived as poor.

''I don't think they'll get much money from us. I don't see it being enforceable,'' Goyen says on the phone. ``They threaten us, but we just find a different program, and other computer savvy kids will find new programs.''

Dalia Weintraub, 17, of North Miami Beach, says she has 1,000 MP3s and agrees. ``It's an empty threat. I don't consider it a big deal. Sometimes I only like one or two songs and I'm not going to buy an entire CD for that song.''

The RIAA, however, says the theft of intellectual property using peer-to-peer software programs such as KaZaA, Morpheus or Grokster is a ''big deal'' and attributes the decline in music sales -- 25 percent since 1999 -- mostly to music piracy.

''I think that the industry has no choice but to take this route,'' attorney Leslie José Zigel says on the phone from his Miami office. Zigel, a shareholder with the law firm Greenberg Traurig, says that ``Intangible property is a hard notion for people to wrap their arms around and feel that it's property like a tube of toothpaste at the Wal-Mart, but at the end of the day it is property.''

Zigel gives an example. ``You go to a doctor and he gives you advice, but not medicine. No one would think of not paying the doctor. You took his time and his advice.''

Take Grimm, 30, a member of Miami rock group Darwin's Waiting Room, a band signed to the folding MCA Records. ''This is my living. People think [they're] getting something over on the record label and showing these big corporate a- - - - - -s what's up. Fact of the matter, it hurts the artists. If you don't sell a certain amount of records, you will get dropped,'' he says on the phone.

That view isn't winning the RIAA total support.

Says Sunrise's Jason Valhuerdi, 24: ``If you really want to get your music out there and you're a struggling artist who can't get your name out by [regular] distribution, the next best thing is the Internet. The down side is if people download music and don't make any attempt to purchase music.''

Valhuerdi estimates his downloads number in the hundreds.

''I'm the type of person that likes to own the CD and the cover art and I like to support the band,'' he says. ``They worked hard to get their stuff out there. But there are bands out there that are making millions. . . . A band like 'N Sync or Eminem, he's got tons of money. I'm going to download an Eminem song.''

The move by the RIAA strikes him as heavy-handed.

''[It] will give them a bad name,'' he says. `` Let's drop prices. Maybe people will purchase the CD.''
http://www.miami.com/mld/miamiherald...nt/6199993.htm


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Rhapsody Says CD Burning Doubled Since Price Drop
Reuters

Listen.com on Tuesday said it has seen a nearly 100 percent increase in CD burning among subscribers to its Rhapsody online music service since cutting its fee to 79 cents from 99 cents per track. Rhapsody would not disclose how many tracks were actually burned in June, but said that on-demand streaming has increased 45 percent to more than 11 million songs, or more than 350,000 songs per day, in June.
http://boston.com/dailynews/183/tech...rnet_fi:.shtml

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Net Services Promise Anonymous File Sharing – Eventually
Jefferson Graham

With the record industry preparing to sue its customers -- at least those who download without paying -- now comes the next step: file-sharing services that promise to keep users anonymous.

Recording Industry Association of America officials say they can find any song swapper on services such as Kazaa and Grokster using simple tracking software. But new services such as Earth Station 5 and eDonkey2000 say they can protect the identity of their users. And established file-sharing services say they will adapt to protect their customers.

The RIAA's actions ''will force us to come up with solutions that will make it harder, if not impossible, to detect who the users are,'' says Elan Oren of Imesh, a song- and game-swap firm based in Israel. ''It's the never-ending game of the firewall and the hacker.''

Imesh -- which has been in operation since 1999 and somehow never was sued, unlike Napster, Scour, Aimster, Audio Galaxy, Kazaa, Morpheus and Grokster -- has 50 million registered users. Oren suggests that, instead of suing its customer base, the RIAA make peace with file sharers and learn to co-exist.

''By attacking its users, they are motivating them not to pay,'' he says. ''We met with them and begged them to make their material available on Imesh for a fee, because we know our users would gladly pay. (The RIAA) refused.''

Songs on Imesh are traded the traditional way -- click on a title to download the file, and it ends up on your hard drive. New programs such as eDonkey and Earth Station 5 do it differently, cutting a file into little pieces and reassembling it when it arrives at your hard drive -- a process that makes it harder for file sharers to be tracked and unmasked.

Still, Internet detective Mark Ishikawa insists that despite new technologies, if it happens online, he'll find it. ''If five buddies are sharing in their dorm room, that's one thing,'' says the CEO of BayTSP, which works for studios and record labels. ''Once it gets to critical mass and goes out onto the Internet, you can't hide.''

Another avenue that analysts expect to lure file sharers is instant messaging. AOL, MSN and Yahoo's chat programs have nearly 100 million users among them. Besides conversing with buddies, users of the software can send photos and music files to each other, without being tracked by the record industry.

For now, the RIAA says it will stay focused on the more established file-sharing programs. ''We can't solve every problem, only the biggest ones before us,'' says RIAA president Cary Sherman.

Kazaa, the most popular swap service with more than 240 million users, shows no sign of slowing down despite the legal threats: 890 million files were being traded Thursday afternoon by 4.3 million users.
http://story.news.yahoo.com/news?tmp...atoday/5280775


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ECT Act Could Put Pirate Viewers In Jail
Tracy Burrows

Internet law company Buys Incorporated has added its voice to warnings that pirate TV viewers could face jail sentences in terms of the provisions of the Electronic Communications and Transactions (ECT) Act. This follows a court case between MultiChoice and a pirate TV viewer.

Last week, the media reported on a Cape High Court judgment that let a pirate viewer off the hook after prosecution by the state in terms of the Broadcasting Act of 1999. The findings implied that MultiChoice had been broadcasting without a licence as it only had permission from the Independent Broadcasting Authority of SA to offer its subscription satellite services.

MultiChoice responded with a statement that until 1999 it was not required to hold a licence, because satellite broadcasting was not regulated. It said the company now complied with the requirements and timeframes of the Broadcasting Act of 1999 and the subsequent Broadcasting Amendment Act of 2003.

"The Cape High Court decision on the case last week appeared to indicate that pirate viewing and tampering with TV decoder smart cards were not crimes in SA," says Internet attorney Reinhardt Buys.

"In fact, nothing could be further from the truth," says Buys. "The MultiChoice pirate viewers were prosecuted in terms of outdated broadcasting legislation and not in terms of the new ECT Act."

MultiChoice spokesman Lebogang Hashatse said pirate viewers were not a problem for the company and that it had the issue under control. Hashatse said even if MultiChoice was not afforded any protection in terms of the Broadcasting Act, "companies were protected as piracy was generally considered an illegal act".

Buys points out: "In terms of section 86 of the ECT Act, a person who intentionally accesses data without the permission or authority to do so, is guilty of an offence and may face imprisonment of up to 12 months or a fine. Furthermore, tampering with a smart card is also a criminal offence that may result in a heavier fine or five years in jail. The Act's definition of ‘data' is wide enough to include digital TV broadcasts.

"Any person who assists a pirate viewer in gaining access to a pay satellite TV channel also commits an offence. The MultiChoice pirate was lucky not to be prosecuted in terms of the ECT Act, as his fate would have been dramatically different," says Buys.
http://www.itweb.co.za/sections/busi...0306300942.asp


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P2P Downloaders Go Anonymous With Blubster 2.5

Music Centric Network Provides Privacy to Downloaders and Powerful Marketing Tools to Artists
Press Release

Optisoft S.L., provider of popular peer-to-peer program Blubster, today announced the launch of Blubster 2.5 in the wake of the latest litigious efforts by the RIAA and MPAA to erode consumer privacy and monopolize control of the P2P entertainment market. As Verizon has been handed a court decision forcing the company to reveal the identity of Internet subscribers accused of music piracy, Blubster has re-launched with a new secure, decentralized, self-assembling network that provides users with private, anonymous accounts. (www.blubster.com).

"In an age of media consolidation, it is critical that P2P networks thrive," demands Pablo Soto, developer of Blubster. "Blubster will always pursue counter measures to preserve the freedom and empowerment of decentralized networking. The very existence of our network ensures artists and content creators an alternative to signing away their rights to copyright barons."

Blubster’s latest update is giant leap ahead of other P2P networks. Version 2.5 takes advantage of a streamlined means of distributing large files to dissociate file transfers from specific users.

"If other means of delivering media files could be compared to a postal system with an identifiable sender and receiver, then Blubster’s proprietary MP2P network could be likened to throwing a bottled message into the vast ocean," said Pablo Soto. "The message may get to a destination, but no one knows the full path of its journey nor what is in each bottle."

The first public version of Blubster was ranked "Best Program" in users’ opinion on CNET's Download.com listing for MP3 search tools. Today, Blubster has won the confidence of more than 10 million desktop users all over the world and more than 100,000 users sharing over 20,000,000 songs are connected simultaneously to Blubster, representing the world’s largest online music network.

The powerful new release empowers users to swap music-only files at extremely high speeds, with multi-sourced and auto- resuming downloads, buddy list, private and channel based chat, voice chat, among other features, in a totally decentralized environment. This advanced, third generation file-sharing program gives both, musicians and fans a powerful and free desktop solution to share files in MP3 and the emerging OGG Vorbis music formats.

Blubster 2.5 has many new features; several of which are unique to the Blubster platform.

- Private protocol, featuring a “serverless” peer-to-peer
network with anonymous access and auto-regulated connectivity
for unlimited scalability.

- Speeds never seen before in any peer-to-peer file-sharing
network.

- .OGG Vorbis support, a music format considered by many to be
superior to MP3, has both a higher quality sound and smaller
file size.

- Multi source downloading with the most advanced techniques,
having much higher transfer rates than those achieved via
other protocols, such as HTTP.

- Web links support, providing musicians a new way to share
their creations with an immense and targeted audience.

May Contain 3rd Party Software – JS.
http://www.marketwire.com/mw/release...lease_id=54968


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Filter
Cynthia L. Webb

File Swappers Beware

The Recording Industry Association of America (RIAA) is taking a lot of heat this morning after its announcement last week that it will sue hundreds of suspected digital pirates. It comes as entertainment industry representatives get ready to meet with file-sharing network owners, who are trying to start their own lobby group to prove their legitimacy to Capitol Hill.

The Associated Press said the RIAA's lawsuit plan "drew the ire of many fans, driving speculation that it could ultimately backfire and encourage a new crop of file-sharing services capable of keeping users anonymous. Filetopia already promises to do just that, and another, called Blubster, is to launch Monday." Gigi Sohn, president of Washington-based technology and copyright group Public Knowledge, told the wire service: "They can sue all they want, but that's not going to make CD sales go up."
• The Associated Press via The Seattle Post-Intelligencer: Music File Sharing Not Missing A Beat Over Lawsuit Threat

Chris Hoofnagle, deputy counsel of the Washington-based Electronic Privacy Information Center, said the RIAA's action could impact consumer privacy, according to The Denver Post. He also said that free music fans still will find ways to get their music downloads. "There is going to be a technical measures war between the industry and the users," Hoofnagle said.
• The Denver Post: Singing The Privacy Blues

Michael Weiss, chief executive of StreamCast Networks (owner of file-sharing software site Morpheus), said he will appeal to Congress over the RIAA's lawsuit plan. "The record industry called peer-to-peer users pirates, but what these people are are hundreds of millions of voters," Weiss said, according to BBC News Online. "At the end of next month, we're going to be involved in helping to mobilise [sic] peer-to-peer users around the world and ultimately around the globe to ensure that their voices are heard."

The Electronic Frontier Foundation is calling for popular support of file-sharing networks. The San Francisco-based civil liberties group's Web site has a letter that people can sign and send to their representatives on Capitol Hill. "This is only the most recent development in a campaign that is putting companies out of business, forcing college students to hand over tens of thousands of dollars, and bullying ISPs into betraying your trust. Adding insult to injury, these tactics don't earn a single penny for the artists you love. It is time to change the laws that the RIAA relies upon to bully the public. There are over 60 million Americans using P2P today, and you can make a difference. Send this letter and urge Congress to hold hearings on using P2P to get artists paid," the EFF site said to describe the letter campaign.
• BBC News Online: Music Swappers Plan Protest

The Unsinkable Jack Valenti

Motion Picture Association of America chief Jack Valenti is holding a meeting today to figure out who will replace him once he steps down, the Hollywood Reporter said. "Valenti, 81, has hinted that he is contemplating stepping down as president and CEO of the Motion Picture Assn. of America, and has held discussions with studio executives for some time about planning for an orderly changing of the guard," the trade magazine said. But it looks like Valenti, ensconced as head of the group since 1966, is a little testy when people bring up the idea of his departure. "When asked last week at a going away party for Hilary Rosen, who is leaving the helm of the Recording Industry Association of America, when this would happen for him, Valenti said flatly: 'The job's not open.'"
• The Hollywood Reporter via Reuters/washingtonpost.com: Hollywood’s Man In D.C. To Talk Succession On Monday

"I may leave in September, I may leave in December, I may leave in June '04 or I may leave in December '04," Valenti told The Los Angeles Times recently. "So long as I'm able to do a 15-hour day without collapsing, and so long as 90 percent of it is fun and 10 percent is business, I'll keep going."
• The Los Angeles Times via The Canton Repository: Jack Valenti's Long Goodbye

Valenti, a dedicated opponent of online movie file sharers, was online with washingtonpost.com last week to talk about digital piracy. When asked whether the MPAA would follow the RIAA and lob its own lawsuits against individuals swapping movies online without permission, he replied. "We have no such firm plans at this time. But I don't rule out any options if the occasion requires it." See a full transcript of the discussion here.

http://www.washingtonpost.com/wp-dyn...l?nav=hptoc_tn


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File-Sharing Firms Plan European Lobbying Effort
Bernhard Warner

Internet file-sharing firms are forming a lobbying group in Europe to defend their business interests against media companies trying to force them out of business, a member of the coalition told Reuters on Monday.

The move is the latest sign that file-sharing outfits, which until recently operated far away from the public eye to avoid litigation, intend to fight for their right to distribute software that enables computer users to share files online.

Media and software companies say the technology is a threat to their business because it allows users to exchange copyright-protected materials such as video games, music, film and software with others for free.

Last week, file-sharing firms Grokster and LimeWire said that, along with an unspecified number of rival firms, they were in the process of forming a lobbying entity to convince the U.S. Congress of their legitimacy.

The initiative won't stop in Washington D.C., said Pablo Soto, a Madrid-based developer of file-sharing technology Blubster. European firms are forming a lobby group in Europe with plans to work with the U.S. group.

"We are joining forces to make the U.S. Congress and the European Union listen to us and the hundreds of millions of voters who use our services," Soto told Reuters.

Soto said details on the coalition will be released as soon as late July. He would not say if the group had hired a lobbyist, nor how many file-sharing firms were involved.

The recording industry is stepping up the heat on file-sharing outfits, claiming they are opening the floodgates to Internet piracy, a phenomenon that is eating into CD sales.

Last week, the Recording Industry Association of America said it would take individual file-sharers to court in an effort to clamp down on the daily flow of millions of unauthorized exchanges.

The International Federation for the Phonographic Industry, a global trade group that counts hundreds of independent and major music labels such as Sony Music 6758.T and Universal Music EAUG.PA V.N as members, has also vowed to keep legal pressure on the firms.

Soto argued that there are legitimate uses for the technology that could be snuffed out if the law suits are successful.

He added the group does not intend to seek changes to existing copyright laws. He said the primary aim is to protect the privacy of individual users and keep them out of court.

"It's something we've got to do," Soto said.
http://asia.reuters.com/newsArticle....toryID=3013148


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Contract Case Could Hurt Reverse Engineering

Supreme Court decided not to hear accused company's appeal
Grant Gross

A U.S. Supreme Court decision could call into question a common practice among software companies: studying competitors' products to improve their own offerings.

The legality of this practice, called reverse engineering, is in question after a lower court found that a software company had violated a shrink-wrapped license contract when it reverse-engineered a competitor's piece of software.

Last week, the Supreme Court decided not to hear the accused software company's appeal.

Although the breach of contract ruling applies only to the U.S. Court of Appeals for the Federal Circuit, the Supreme Court's lack of action could embolden other software companies to prohibit reverse engineering or take away other fair use rights allowed under copyright law by including such prohibitions in an end user license agreement, said Karen Copenhaver, a patent and intellectual property lawyer with Testa, Hurwitz and Thibeault, of Boston.
http://www.infoworld.com/article/03/...neering_1.html


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Hollywood will spend approximately $500 million on data storage in 2003 alone, a figure that will grow 70 percent annually.

New Technology A Boon For Big Screen
John Borland

BURBANK, Calif.-- In the middle of the Warner Bros. lot here, surrounded by vast warehouses and soundstages, the past and the present are meeting amid banks of data-crunching and storage devices housed at a high-tech control center.

It is here that the studio recently turned the original Technicolor release of "Singin' in the Rain" into a crystal-clear digital file, using state-of-the-art technology that produced a far better version than would have been possible just a few years ago. The studio's chief technical officer, Chris Cookson, showed it off to most of the original cast late last year.

"The comment I heard was that it looked like it did when they did it on stage," says Cookson, laughing. "Debbie Reynolds, who was maybe 19 when she did the movie, said it was so clear you could even see wrinkles on her face."

The 1952 classic's restoration reflects a seismic shift for Hollywood studios, broadcast networks and other media companies, which are digitizing new works and decades of archives to take advantage of new distribution channels: the Internet, high-definition DVDs and TV, and next-generation theaters.

Digital technology is also redefining the art of moviemaking itself, an evolution that is apparent on-screen in current releases such as "Finding Nemo" and "The Matrix Reloaded." With the right digital manipulation, Keanu Reeves can fight scores of computer-generated villains, Pixar Animation Studios can give birth to another family of wise-cracking 3D cartoon characters, and virtual armies can storm citadel walls in the "The Lord of the Rings"--with no extras required.

Behind the scenes, meanwhile, the tools used to create and support this digital wizardry represent multibillion- dollar opportunities for companies such as IBM, Silicon Graphics, Inc. (SGI), Apple Computer and Thomson. And perhaps the most dramatic barometer of this evolution is the seemingly innocuous technology of data storage.

Hollywood companies will spend roughly $500 million on data storage in 2003, and expenditures will increase about 70 percent each year, according to Tom Coughlin, an independent analyst tracking the entertainment industry's storage use. By 2006, Coughlin estimates, the annual storage needs of film studios, video and television production companies, and distribution outfits will reach 740 petabytes, or 740 million gigabytes.

"These trends are forcing spending on information technology tremendously up," says Rick Dougherty, principal analyst with research firm The Envisioneering Group. "It's a glamorous section of IT. Apple, IBM and Sun all brag when they get a big Hollywood contract."

Almost all action thrillers, children's tales and, of course, science fiction epics employ computer-generated effects or characters that would have been impossible with film alone. Digital imaging of this type requires processing, storage and server resources of mammoth proportions.

In the Pixar blockbuster "Monsters, Inc.," for example, fur-covered star James P. "Sully" Sullivan had more than 2.3 million individual hairs that needed to be processed separately by banks of powerful computers. Individual frames in complicated works of this kind can take as long as 80 minutes to render. Similarly complex were the kung-fu fights involving dozens of Agent Smiths in "The Matrix Reloaded," which required the painstaking re-creation of each character's face and clothing, along with innovative lighting effects.

A single hour of digitally animated film can take up a terabyte or more of data storage, and all of it must be available at any time to animators, directors and others working on the movie. That requires networks, storage devices and databases flexible and fast enough to juggle these massive amounts of data.

IBM is one of several companies aiming squarely at this market. It is applying some of the supercomputing techniques used by the Lawrence Livermore National Laboratory to create a fast storage server system that gives multiple people simultaneous access to high-resolution files.

Big Blue is pitching its Linux-based technology as a cheaper, faster and open alternative to the proprietary systems most studios use for this kind of storage and processing work. So far, it has found only a few takers for its most advanced systems, notably Threshold Digital Research Lab, an animation studio that worked on "The Faculty," "Dogma" and "Scary Movie."
http://news.com.com/2030-6683-1001643.html


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RIAA Hit By EFFing Music Campaign

Engage in Congress, ginger group says
Adamson Rust

The Electronic Frontier Foundation will formally announce today a campaign aimed at persuading American citizens to demand changes in the copyright laws.

The "Let the Music Play" campaign, said the EFF, will counter the Recording Industry Association of America (RIAA) bid to file thousands of lawsuits against people who use file sharing software.

Shari Steele, head of the EFF claimed that copyright law in the USA is out of kilter with the views of the American public.

She said: "Rather than sue people into submission, we need to find a better alternative that gets artists paid while making file sharing legal".

The campaign will place adverts in a number of publications and attempt to make it easy for voters in the USA to write Congress politicians.

Senior lawyer Fred von Lohmann claimed: "Congress needs to spend less time listening to record industry lobbyists and more time listening to... 60 million Americans who use file sharing software today".
http://www.theinquirer.net/?article=10252


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Court: Anonymous P2P No Defense
Paul Festa

Operators of peer-to-peer networks cannot escape copyright infringement claims by giving their members the ability to mask the content that changes hands on their networks, a federal appeals court ruled Monday.

Calling the tactic a form of "willful blindness," the 7th U.S. Circuit Court of Appeals in Chicago upheld a lower court's injunction against the Madster file-swapping network that had ordered the service shut down pending a trial. But, in a mixed decision, the court also bolstered a key defense argument invoking a comparison between file-swapping software and personal home video recording.

Before it was shut down, Madster had offered its users the ability to encrypt files traded over America Online's AOL Instant Messenger client. As a result, its operators had argued that they had no obligation to seek to block illegal files swapped on the network because they were unaware of specific copyright violations.

In a decision that could dampen efforts to bring privacy to file-swapping networks, the court on Monday rejected that reasoning.

"One who, knowingly or strongly suspecting that he is involved in shady dealings, takes steps to ensure that he does not acquire full or exact knowledge of the nature and extent of those dealings, is held to have criminal intent," the panel wrote in the 23-page decision.

Privacy in file-swapping was put on the front burner last week when the Recording Industry Association of America said it would begin investigations aimed at bringing lawsuits against individuals who make large numbers of files available for uploading on peer-to-peer networks such as Kazaa, Morpheus and Grokster.

Since June 17, a file-swapping client promising improved privacy known as Blubster 2.5, has seen more than 3.3 million downloads, according to CNET Download.com, a division of CNET Networks.

"I wouldn't say it's the end of the road for (Madster), but one of the things that makes it tough is that the (court) is highly critical of the willful blindness approach to running these sorts of companies," said Tim Wu, an associate professor at the University of Virginia Law School. The opinion "suggests that deliberately creating something beyond your control is not going to get you out of copyright infringement."

Madster, previously called Aimster, is one of several peer-to-peer, or P2P, online file-swapping services designed to facilitate the sharing of computer files, including audio tracks. Its more famous predecessor, Napster, has been credited with revolutionizing the distribution of popular music, though lawsuits by the recording industry shut it down. The services are also used to swap digitized copies of films and TV programs.

The Aimster case is not the only file-swapping case wending its way through the courts. In April, the courts handed a major defeat to the recording and movie industries with a decision holding that file-swapping networks Streamcast and Grokster were not liable for contributory infringement due to illegal activities of their users.

In December, a federal court ordered Madster to shut down after the service failed to comply with a preliminary injunction ordering it to put an end to copyright infringement. Monday's ruling upheld that decision.

"We are pleased that the injunction against Aimster was upheld, effectively shutting it down until trial," Motion Picture Association of America President and CEO Jack Valenti said in a statement. "This is another indication that so called 'file-sharing' businesses designed to benefit from the illegal use of copyrighted movies will not be tolerated."

Madster operator Johnny Deep said Monday that although the court had failed to lift the injunction against him and his service, it had taken his side in approving a legal analogy between Madster and Sony's Betamax video recorder--an analogy the recording industry is eager to discredit.

"The court agreed with us on matters of law," said Deep in an interview. "It said Sony does apply. It disagreed completely with the record industry on that."

In the 1984 Sony case--Sony Corp. of America, Inc. v. Universal City Studios, Inc.--the Supreme Court ruled that making a product that has "substantial noninfringing uses" is not itself a contributory infringement, even if that product is used to infringe. Therefore Sony couldn't be held responsible for the unlicensed copying on its Betamaxes of copyrighted works.

In Monday's decision, the court rejected the recording industry's argument that because Aimster was capable of blocking infringing uses, it should necessarily be considered a contributory infringer. Instead, the court ruled, if detection and prevention of copyright infringement were "highly burdensome" to a service provider, that provider would escape an infringement claim.

Deep pledged to appeal the injunction on the basis of its being too broad--a contention the 7th Circuit explicitly rejected. He also pledged that his determination to fight would sour the recording industry on its promise to sue individual file-swappers in large numbers.

"This is a case against me personally," Deep said. "And I'm going to give them a little taste of what it's like to sue these thousands of people who are determined and who believe that they're doing the right thing."
http://news.com.com/2100-1025-1022462.html


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Some Bands Spurn Apple's iTunes Online Music Store
Reuters

Rock bands The Red Hot Chili Peppers and Metallica are refusing to make their music available as individual downloads on Apple Computer Inc's AAPL.O iTunes online music store, a representative for the bands, said on Wednesday.

That move comes in response to Apple's decision to allow users to buy single tracks and is intended to protect the future of the long-playing album, the format that has dominated the music industry for decades, an agent for the bands said.

"Our artists would rather not contribute to the demise of the album format," said Mark Reiter, with Q Prime Management Co., which manages the Red Hot Chili Peppers, Metallica and several other artists.

Green Day and Linkin Park, according to a source familiar with the situation, have also refused to make their songs available as individual downloads on the Apple service, which has already sold more than 5 million songs since launching this spring.

According to Reiter, Apple refuses to sell albums in their entirety unless the artists also allow the tracks on the album to be sold independently as digital downloads.

"We can't let a distributor dictate the way our artists sell their music," Reiter said, adding that the business terms were otherwise acceptable.

Apple had no immediate comment.

Calling the issue more a "creative issue than a financial issue," Reiter said the artists felt that if consumers can download their singles, they are less apt to buy entire albums.

"If you download a single, you may ignore the other tracks on the album," he said. "When our artists record a body of work, it's what they deem to be representative of their careers at that time."
http://asia.reuters.com/newsArticle....toryID=3029706


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P2P Alliance To Counter RIAA?
Lisa M. Bowman

The company behind the popular Kazaa file-swapping software plans to launch a trade group Wednesday to push the case for peer-to-peer networking.

Kazaa distributor Sharman Networks and partner Altnet hope their new group, called the Distributed Computing Industry Association (DCIA), will help legitimize the much-maligned peer-to-peer industry, which has come under fire from Hollywood, politicians and the recording industry for being a haven for pirates.

Martin Lafferty, the DCIA's chief executive, said the group is hoping to provide a neutral forum where companies that are affected by or involved in peer-to- peer or distributed computing technology can meet to establish business practices, to encourage the adoption of standards and to help shape public policy.

The association hopes to attract peer-to-peer network providers, software makers and Internet service providers as members. It also aims to draft content providers such as the movie studios and record labels. Ideally, members will be optimistic about the business opportunities presented by peer-to-peer technologies, but will also believe that copyright owners should be compensated for their work, according a DCIA white paper.

"Then this becomes a real and rational business and not just something for hobbyists," Lafferty said.

Sharman, which is based in Australia, is the parent company of Kazaa, one of the most popular online file-swapping services. Altnet is a subsidiary of Brilliant Digital Entertainment. Earlier this month, in an attempt to diminish piracy, the two companies jointly released a new bundle of file-swapping software that includes components of a high-security peer-to-peer network, and a program that pays users to be a part of it.

Although peer-to-peer networks have soared in popularity, they've also drawn lawsuits from record and movie companies who say they provide an easy method for people to freely trade unauthorized copies of songs and films. Peer-to-peer companies including Aimster, Napster and Scour have all found themselves on the losing end of entertainment industry lawsuits.

Now, the media industry has expanded its approach to go after individuals who use peer-to-peer networks in addition to chasing the companies that provide the technology.

Just last week, the Recording Industry Association of America (RIAA) warned that it would start gathering information about people using peer-to-peer networks to share music, so it could file thousands of copyright infringement lawsuits against them.

Lafferty said that the DCIA hopes to extend an olive branch to the entertainment companies and work with them to come up with an alternative to litigation.

"It's never a good idea to criminalize your target customers; it's something you kind of do out of desperation," Lafferty said. "It will take the industry somewhat burying the hatchet and sitting down at the table, and the DCIA wants to provide the table."

Lafferty, who once launched a satellite TV industry trade group, said the peer-to-peer market is facing many of the same issues the satellite TV market once did. He said that at first, the satellite TV industry was a hotbed of piracy, with people buying dishes to gain unauthorized access to paid TV programming. But programmers, technology companies, and other players eventually got together to hammer out business plans amenable to all sides, he said.

A representative from the RIAA is hopeful that the new group will help foster a positive dialog with copyright holders.

"Anytime anyone wants to talk to us about becoming legitimate--compensating artists, songwriters and others for their creative works--we are happy to listen," the representative said.
http://news.com.com/2100-1027-1022811.html


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Corbis Sues Amazon, Online Stores Over Images

SEATTLE (Reuters) - Corbis Corp., a photography provider owned by Microsoft Corp. (MSFT.O) Chairman Bill Gates, said on Tuesday it sued Web retailer Amazon.com Inc. (AMZN.O) for being party to illegal sales of its images. 'We're going to be very aggressive about people that infringe willfully on our intellectual property,' Corbis Chief Executive Steve Davis told Reuters. 'Amazon has been a part of that and participated in these transactions.'
http://boston.com/dailynews/183/tech...rnet_fi:.shtml


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Giving Sharers Ears Without Faces
Xeni Jardin

In response to recent threats to file traders, peer-to-peer developers say they're seeing an upsurge of interest in tools that purport to hide identities.

The pressure comes from the Recording Industry Association of America's announcement Wednesday that it plans to sue hundreds of uploaders, and a recent court ruling requiring Verizon to reveal the names of subscribers accused of piracy.

Blubster developer Pablo Soto of Madrid said his music-swapping service relaunched today as a secure, decentralized system providing users with anonymous accounts.

The MP2P network (short for Manolito Peer-to-Peer) on which Blubster is based consists of more than 200,000 users sharing over 52 million files, according to Soto. The update is also said to include a new, streamlined file-distribution method that disassociates transfers from specific users.

"The biggest privacy weakness of our previous version was the ability to query a list of shared songs for any user -- now that can be disabled," Soto said. "It may be possible to gather IP addresses from the network, but not data about what content specific users are sharing."

Blubster uses an Internet data transfer protocol known as UDP for content look-up and transfer negotiating. Unlike the TCP protocol that serves this function in other file-sharing networks, UDP is a so-called "connectionless" method that doesn't reveal links between nodes or acknowledge transmission in an identifiable manner.

Because UDP transfer logs don't reveal detailed information about which user at which IP address is accessing what content at what time, they are considered less vulnerable to legal discovery than TCP logs.

"Any technology that allows people to communicate is a step in the right direction," Soto said. "This isn't just about exchanging music, this is about the right to create technology and enjoy the right to privacy."

Developer sources told Wired News that pro-P2P coalitions are forming in the United States and Europe to centralize lobbying and public relations efforts. Coalition members are said to include Grokster, LimeWire, Blubster and others. Public announcements are expected in July.

Philip Corwin, Washington, D.C.-based lobbyist for Kazaa distributor Sharman Networks, predicts file traders will migrate to anonymous networks and "sneaker networks" that facilitate trades among smaller groups of swappers. This is already possible through popular instant-messaging clients from Yahoo, Microsoft and America Online, and through tools such as Waste, the application created by principal Nullsoft developer Justin Frankel that facilitates secure exchanges among private groups.

"There is no practical technological means to obliterate the public's ability to transfer files," Corwin said. "The RIAA lawsuits may create a chilling effect that deters some or causes others to limit the size of shared collections to minimize risk. It will probably drive more technologically adept consumers to systems that profess to offer more security against legal assault."
http://www.wired.com/news/culture/0,1284,59448,00.html


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Center For Democracy And Technology

Peer-to-Peer File Sharing Privacy And Security
Summary

Concerns are exacerbated by the growing use of file-sharing programs by millions of individuals and families, often with little or no training or experience.

With these risks come benefits. Peer-to-peer file sharing can be used for legitimate, non-infringing file distribution. Its underlying technology, not so different from peer-to-peer networks like the World Wide Web, is rapidly evolving and being adopted for many new uses. Regulating this technology without broader ramifications would be difficult, and could have many unintended consequences.

How then do we address these real privacy and security concerns? CDT believes that an active program of education and better software practices is needed. Such a program would:

* Inform people about the risks in file sharing - The public, and particularly the families of file-trading minors, need greater awareness of the potential risks of file sharing. Educational efforts- like the Internet community GetNetWise website-are already including tips for safe peer-to-peer use that should be widely disseminated.
* Seek fair information practices in file-sharing software - Much more should be done to design peer-to-peer software with transparency and better control over shared files. Software producers should reject invasive spyware, adopt fair information practices, and must provide better notice when information is transmitted to third parties.
* Add privacy protections for DMCA subpoenas - Privacy and safety protections for end users should be included in the broad DMCA Section 512(h) subpoena provision in order to require more due process - including notice to the user and other protections- before ISPs are compelled to reveal sensitive personal identity information.
* Prevent invasive "self-help" tactics- In no circumstances should it be legal to damage another person's computer or files based on allegations of wrong-doing, including copyright infringement.

All of this should take place against the broader backdrop of action regarding Internet privacy generally, where the continued growth of privacy technologies and industry self-regulatory efforts along with baseline privacy legislation are necessary to ensure public trust and democratic values.

Congress has a valuable role to play in educating the public about the potential risks of file-sharing systems, in encouraging companies to design more user-friendly systems, and in modifying current legal provisions that create privacy risks. CDT looks forward to working with this Committee and others to further these efforts.
http://www.mi2n.com/press.php3?press_nb=53760


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Online File-Sharing Networks Set Up Lobbying Shops
Andy Sullivan

Internet file-sharing networks that allow users to copy songs for free are organizing to counter mounting pressure from the entertainment industry and Capitol Hill, industry officials said on Tuesday.

"Peer to peer" services including Kazaa, Grokster and LimeWire are hiring lobbyists and setting up trade associations in Washington to convince power brokers in Congress and Hollywood to work with them, rather than demonize them.

Since Napster introduced the concept in 1999, millions of Internet users have logged on to peer-to- peer networks to copy music, movies, software and other files from each others' hard drives, a practice the recording industry says has led to a sharp decline in CD sales.

Record labels have actively pursued the peer-to-peer services in court, and last week announced that they plan to sue individual users as well. Meanwhile, lawmakers have condemned the networks because they make pornography readily available to minors and expose users to viruses, hacking and other security risks.

Peer-to-peer officials say it's time to tell their side of the story.

Entertainment companies "are not going to come to the table until they're forced to," said Grokster President Wayne Rosso. "The only way we can force them to come to the table is to make our users' voices heard in Congress."

Rosso said Grokster and several other peer-to-peer groups will unveil an advocacy group within the next 60 days to argue that they represent a promising new distribution channel for legitimate content, rather than just a conduit for copyright infringement.

Separately, the two companies behind the popular Kazaa network have sponsored an umbrella group that hopes to draw in electronics makers, Internet providers and entertainment companies, as well as other peer-to-peer firms.

The Distributed Computing Industry Association had its first meeting last night in Los Angeles with record-label representatives and other industry players, "and there were no fistfights," Chief Executive Marty Lafferty said.
http://asia.reuters.com/newsArticle....toryID=3022618


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Rights Group Defends P2P In Ad Campaign
Kate Leadbetter

The Electronic Frontier Foundation has launched an advertising campaign demanding changes in copyright law to legalise file sharing.

The "Let the Music Play" campaign is intended to encourage the six millions users of file-sharing software in the US to make their voices heard in government, as a counterweight to increasingly vehement condemnation of peer-to-peer file sharing networks by the entertainment industry. The campaign, launched on 30 June, follows the RIAA's announcement last week that it intends to begin filing lawsuits against a large number of the individuals who use file-swapping services like Kazaa and Morpheus.

Shari Steele, the executive director of the EFF, said in a statement that copyright law is "out of step with the views of the American public and the reality of music distribution online". Steele said that the RIAA's efforts would be better directed finding a way for the music industry and peer-to-peer networks to coexist: "rather than trying to sue people into submission, we need to find a better alternative that gets artists paid while making file sharing legal."

The recording industry's legal tactics successfully shut down an earlier generation of file-swapping services, such as Napster, but file-sharing usage has continued to grow. The industry blames file-sharing for a precipitous drop in music sales; in the past three years, unit shipments of recorded music have dropped by 26 percent from 1.16 billion units in 1999 to 860 million units in 2002.

As a solution, the RIAA said last week it would begin gathering evidence and preparing lawsuits against individuals who offer "substantial amounts" of copyrighted music over peer-to-peer networks. "The law is clear and the message to those who are distributing substantial quantities of music online should be equally clear -- this activity is illegal, you are not anonymous when you do it, and engaging in it can have real consequences," said RIAA president Cary Sherman in a statement announcing the strategy. The RIAA has already begun suing individual P2P users. Earlier this year, for example, the RIAA successfully sued four university students for P2P piracy, ordering each to pay $12,000 to $17,000 (£8,000 to £11,000) in compensation.

EFF Senior Staff Attorney Fred von Lohmann said that America's politicians are failing to recognise the importance of the P2P community. "Today, more US citizens use file-sharing software than voted for President Bush," he said. "Congress needs to spend less time listening to record industry lobbyists and more time listening to the more than 60 million Americans who use file-sharing software today."

The EFF will place advertisements about the Right to Share campaign in magazines including "Spin", "Blender", "Computer Gaming World", and "PC Gamer".
http://news.zdnet.co.uk/story/0,,t26...zdnetukhompage


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New File-Sharing Sites Hide Users' IDs
AP

Music fans continued swapping songs over the Internet, though a bit more cautiously, despite the recording industry's threat this week to sue individuals engaged in digital piracy.

The threat appeared to have little effect on the pace of downloading over the most popular file-sharing services.

But the move drew the ire of many fans, driving speculation that it could ultimately backfire and encourage a new crop of file-sharing services capable of keeping users anonymous. Filetopia already promises to do just that, and another, called Blubster, launched Monday.

"The recording industry is not going to win if all they do is sue people," said Gigi Sohn, president of Public Knowledge, a Washington-based advocacy group on technology and copyright issues. "They can sue all they want, but that's not going to make CD sales go up."

Yet the campaign could result in the proliferation of file-sharing services that outfox efforts to detect the users' identity.

"If the recording industry succeeds in their goal of making large numbers of people feel unsafe in their file sharing, it's a safe bet that someone will come along to fill the sudden demand for an easy, safer way to use P2P," said Adrian Lamo, 22, a communications researcher from San Francisco.

For now, many users of file-sharing services said they took some precautions, but remained undeterred.

"I don't think that I trade in the volumes that they would be interested in," said Alec Cumming, 24, a Los Angeles film restorer who estimates he has 200 downloaded songs on his computer. "If they really went after me, I would pretty likely stop. I'm not making any money off of it."

Others hoped to skirt the RIAA's sweep, which is initially targeted at those who share "substantial" collections of MP3 files, by simply disabling the sharing feature on their software -- something the RIAA hopes will mean fewer songs available on the networks.

"I turned (the feature) off because they're on their witch hunt, and I think the witch hunt will die off and prove to be just that," said Jeff Gregory, a Web editor in North Palm Beach, Florida, who uses Kazaa. Gregory, 32, estimated he has 600 songs downloaded on his computer -- and he intends to get more.

There were about 10 million fewer files traded on FastTrack between Wednesday and Thursday afternoon, though the difference amounted to a decline of only 1 percent.

"That number should drop off over time if the deterrence is having effect," said Phil Leigh, an analyst with Raymond James & Associates. Sohn said people won't really get scared until RIAA starts filing its lawsuits. But she warned that the industry risks consumer backlash if it sues "every Tom, Dick and Harry with a handful of songs." Leigh said the industry's strategy overlooks the impact of CD burning. If the industry squelches file sharing, he said, young music fans will simply trade copies of CDs.

While such a scenario would be an improvement for an industry now seeing millions of music files shared worldwide, Leigh said it underscores how the exchange of music on some level won't go away.

There are 200 million CD burners in use currently, Leigh said. "And the kids are not going to stop using them."
http://www.cnn.com/2003/TECH/interne...oad.music.ap/#