Peer-To-Peer News - The Week In Review – January 24th, '04

[JackSpratts]

Quotes Of The Week

"We now live in a world where people can and will exchange information, globally and instantaneously. There's no turning back the clock on that." – Eric Garland.

"I'll put this online, with your permission, of course." – Justin Frankel



Early Edition



The A’s Don’t Stand For Algebra

When does 4 equal 532? When the RIAA does the math. We all know the record company trade group plays fast with figures, so it’s no surprise they’re doing the same with their latest lawsuits. Since the courts made it clear Americans are protected against unreasonable subpoenas, the RIAA can no longer count on special privileges when it comes to persecuting children and other hapless citizens. Now they have to sue them the same way everybody else sues people in America and that can get mighty expensive, mighty fast. So to get more bang for the buck the RIAA announced this week it was suing a staggering 532 Americans in one giant orgy of judicial overkill, instantly injecting their tired campaign with new drama, and putting it back on home pages and newspapers across the globe. It was a brilliant piece of public relations, getting them more coverage than they could’ve possibly hoped for. 532 suits! All at once! These guys mean business! Except, well, no. They don’t. Not really. You see it’s mostly vapor. Turns out the trade group isn’t suing anywhere near that many. Not five hundred, not three hundred, not even a hundred. The RIAA isn’t even suing a dozen file sharers this time around. In what can only be described charitably as the new math, the RIAA is actually suing just four individuals today or 99% less than the screaming headlines wail. Enough of a difference that the real figure would instill a great yawn in the collective throats of editors, guaranteeing near zero coverage. Those crafty record execs. Gotta hand it to them. That they will attempt to sue more swappers is a given but there is no guarantee the courts will oblige. For the time being they’ve been reduced to IP harvesting. Forget the blaring banners, the whole thing’s a non-issue, for a while anyway.

The RIAA says publicly the lawsuit campaign is effective, although it’s probably more of a “when that’s all you have - you stick with it” thing. From an objective point of view it’s obviously not working, not when file sharing continues to rise, but that file sharing is up during this hyper publicized campaign apparently makes no difference to them or their members, the world’s largest media companies. Still, if people running industries making billions from copyrighted materials truly wanted respect from the Americans who pay them and their artists, they might think about backing off from the hard stuff and coming to the table with workable solutions to the problems threatening their businesses. Instead they make more movie theater spots (to hector paying ticket holders) and invent more DRM laden “solutions” to further penalize anyone attempting to engage them in pay-per-download Internet purchasing. A marketing campaign centered around “Less Choice, Less Options, More Money!” is instantly DOA. Playing with the math won’t fix it. When free is better – even if it isn’t free – is when the record companies really need to work on product benefits if they expect their customers to pay for the so-called privilege of acquiring them.












Enjoy,

Jack.











Free at last.

Supreme Court Unscrambles DVD Decision
Samantha Chang

There's a war raging in cyberspace, and this time it is the movie industry that's feeling the heat.

The U.S. Supreme Court reversed an emergency stay on a case involving DVD descrambling Jan. 3.

In so doing, the high court affirmed a decision of the California Supreme Court, which had ruled that the entertainment industry could not force a Texas resident who had published DVD descrambling software on the Internet to stand trial in California.

This means that the defendant, Matthew Pavlovich, who posted the software called DeCSS, is able to distribute the program online.

DeCSS, which is distributed for free, enables people to play DVDs without technological restrictions, such as forced watching of commercials imposed by movie studios. The program became popular shortly after its dubious debut, being distributed online by thousands of individuals worldwide the first year it was posted.

To the high court, it is a question of geography: The court says Pavlovich cannot be sued in California because he is a Texas resident who does not have "substantial ties" to the Golden State.

Pavlovich's legal woes began in 1999, when a group of film studios and consumer electronics makers sued hundreds of people, including Pavlovich, for distributing DeCSS online, citing a violation of California trade secret laws. A state judge ruled for the plaintiffs and granted an injunction.

Three years later, the California Supreme Court ruled that Pavlovich could not be sued for violating state trade secrets simply because he knew that his actions could hurt the state's film industry.

In the latest ruling, U.S. Supreme Court Justice Sandra Day O'Connor lifted the injunction, saying there was no need to keep DeCSS a secret.

Internet groups wholeheartedly support the decision.

"The entertainment companies should stop pretending that DeCSS is a secret," says Cindy Cohn, legal director of the Electronic Frontier Foundation.

"The Supreme Court wisely recognized that there is no need for an emergency stay to prevent Mr. Pavlovich from publishing DeCSS," Cohn adds.

The decision affects numerous defendants, but the sole California resident is Andrew Bunner.

Bunner isn't fighting the jurisdictional issue but is arguing that he has a First Amendment right to distribute the software.

A California appeals court in 2001 agreed, saying that barring Bunner from future disclosures of DeCSS was "a restraint on First Amendment right."

Bunner's case is awaiting an argument date before the California Supreme Court.

A similar case in Europe already has been resolved.

Norwegian teenager Jon Johansen was acquitted Jan. 7 of criminal charges for writing and publishing DeCSS.

In 1999, 15-year-old Johansen published DeCSS on the Internet. He used the program to watch his own DVDs on his Linux computer.

Under tremendous pressure from the Motion Picture Assn. of America, the Norwegian Economic Crime Unit charged Johansen with violating a Norwegian criminal code that outlaws breaking into another person's locked property to gain access to privileged data.

The case was the first time the Norwegian government had attempted to punish an individual for accessing his own property.
http://www.reuters.com/newsArticle.j...toryID=4152687


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Betamax Legacy Plays On

A court decision 20 years ago on the videorecorder's legality is a point of dispute in the era of online piracy
Jon Healey

Sony Corp.'s Betamax videorecorder long ago vanished from store shelves, but its spirit lives on in Apple Computer Inc.'s iPod.

And TiVo Inc.'s personal videorecorder.

And Archos' portable video player.

And Hewlett-Packard Co.'s Media Center PC, not to mention umpteen other digital devices.

Simply put, virtually any equipment that can record, store or transmit music or movies owes its existence at least in part to Sony and the Betamax.

The Betamax triggered a bitter battle with Hollywood over products that can promote piracy, leading to a landmark Supreme Court ruling that technology and entertainment companies are arguing over to this day.

In the 5-4 ruling, issued 20 years ago today, products that could be used for piracy were deemed legal if they were "capable of substantial noninfringing uses." The opinion gave manufacturers the freedom to produce a range of audiovisual devices without the approval of Hollywood.

Now, lawyers for the entertainment and technology industries are fighting to define what the ruling means in the Internet era. The key question is whether companies can be held liable for products primarily used for piracy — even if people can use those products for legitimate purposes.

The Betamax decision is at the heart of a case pitting Hollywood studios and major record labels against the companies behind the Grokster and Morpheus file-sharing networks. A federal judge in Los Angeles ruled last year that Grokster and Morpheus were legal under the Betamax doctrine, but the studios have challenged the ruling in the U.S. 9th Circuit Court of Appeals.

Software company 321 Studios, whose software can be used to copy DVD movies, is also relying on Betamax to defend against a copyright infringement lawsuit by the studios. That case is awaiting a decision from a federal judge in San Francisco.

At stake is how far technology companies will have to go to protect copyrights before releasing new products or features — and the degree of control Hollywood and other copyright holders will have over those innovations.

The Betamax decision has been a shield for the manufacturers of many products that have both legitimate and illegitimate uses, including VHS machines, CD burners and DVD recorders. But the more narrowly the Betamax decision is applied by the courts and Congress, the smaller the shield will be, enabling copyright holders to force more products to include anti-piracy features.

To lawyers for the entertainment industry, it's too great a stretch to extend Betamax's protection to companies like Grokster and 321 Studios.

Russell Frackman, an attorney who has represented the major record companies in the file-sharing lawsuits, said the main thing people did with Betamax machines — recording shows for later viewing — was legitimate and "done for a very limited purpose in one's home."

By contrast, the main thing people do with file-sharing networks is make and share unauthorized free copies of copyrighted songs and movies.

It's not the technology that's the problem, he said; it's what most people do with it.

"You can rhetorically turn Betamax into a fight over technology. But that's not our position, and if you look at it, that's not what Betamax was talking about."

David Kendall, a lawyer for the major Hollywood studios, contends that the Betamax case doesn't give carte blanche to technologies that can violate copyrights. Although the original Napster file-sharing network relied on the Betamax defense, Kendall noted that the 9th Circuit ruled that the company wasn't taking the steps it could to deter piracy.

Attorneys for consumer electronics and technology companies said the entertainment companies were trying to replay the Betamax dispute, only with a different ending. The same arguments used against the file-sharing networks — that copying entire songs or movies isn't legal and that it damages the market for entertainment — were used against Sony's videorecorder, and the Supreme Court rejected them.

"The Sony Betamax decision was definitely the high-water mark for the growth of technology, all of which has benefited the content community," said Gary Shapiro, chief executive of the Consumer Electronics Assn.

That's quite a distinction for a ruling that very nearly went the other way.

The 9th Circuit ruled against Sony in October 1981, and a majority of the Supreme Court originally wanted to uphold the appellate ruling, said Jonathan Band, a copyright attorney who examined late Justice Thurgood Marshall's papers in the case. But Justice Sandra Day O'Connor switched sides, backing Justice John Paul Stevens' view that Betamax was legal.

Before the recent spate of lawsuits against file-sharing companies, the Betamax case was rarely used to defend a new technology. Although entertainment industry lawyers disagree, attorney Fred von Lohmann of the Electronic Frontier Foundation said this showed how clearly Betamax drew the line between technologies that were legal and those that weren't.

Rep. Rick Boucher, a Virginia Democrat active on technology issues, agreed. Noting the digital revolution sweeping through consumer electronics, Boucher said, "All of that is because of the legal certainty that Betamax provided."

In 1998, Congress muddied the waters for technology companies with the Digital Millennium Copyright Act. The law banned the manufacture or sale of products whose primary intent was to unscramble or pick the electronic locks on copyrighted works.

"A big goal of the DMCA was to create a quid pro quo: If the copyright owners lock their stuff up, the Betamax doctrine goes away," Von Lohmann said. Unless copyright owners approve, he added, the DMCA prevents manufacturers from unscrambling material even for the kinds of legitimate uses that the high court ratified in Betamax.

As a consequence, manufacturers are increasingly looking to strike deals with Hollywood to govern how people can use the next generation of digital products, such as high-definition videorecorders. The risk is that their agreements will be good enough for some consumers, and "we'll never know how much better it could have been," Von Lohmann said.

Steve Kroft, the Los Angeles-based attorney who represented the studios that sued Sony in the Betamax case, said it was nonsense to suggest that copyright owners could limit innovation.

"There's always going to be technological innovation because we're technological innovators," Kroft said. "You just have to operate within the rules…. Don't trample somebody else's rights because you've got the next 'next thing.' "
http://www.latimes.com/business/la-f...-home-business


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Military Officials Find Illegal File Sharers At Fort Myers, McNair
Chris Walz, Pentagram staff writer

Peer-to-peer file sharing programs, such as KaZaA and LimeWire, continue to plague computer systems inside the Fort Myer Military Community and Arlington National Cemetery. The National Capital Region Directorate of Information Management recently evaluated the computer network and discovered approximately 424 computers contained peer-to-peer programs banned by Army regulations.

"That's a lot of computers over a small area," said National Capital Region Information Assurance Manager Rick Coombe. "That's basically 424 computers over Forts Myer and McNair and Arlington National Cemetery."

File sharing programs invite a host of problems, especially on the Army's network.

Basically, these programs give users worldwide access to your computer. They may want to download a favorite song, or they may have more sinister intentions. With the click of a mouse, anyone can potentially download sensitive materials, like troop movements, contracting data and even social security numbers. They can also make a computer vulnerable to viruses.

"If someone gets a virus, we'll have to put a lot of man-hours into rebuilding the infected servers," Coombe said. "That means nobody will be able to use the network and customers will not be able to perform their missions. And, the [financial] expense will be enormous."

For that reason, file-sharing programs such as Tripnosis, iMesh, Wrapster, Napigator, Morpheus, Gnucleus and others are banned from Army computers.

Another problem with file sharing programs is the Millennium Digital Copyright Act, which gives "owners of intellectual material a big hammer," Coombe said. Programs like KaZaA allow people to download copyrighted music and software for free.

"You can go buy a brand new CD and rip it to your computer's hard drive within minutes," Coombe said. "Then, if you have a peer-to-peer program, hundreds of people can download that whole CD without purchasing it."

The music industry successfully won a Supreme Court decision to alter file-sharing practices of Napster and recently began suing individual downloaders. A bigger problem, Coombe said, is the music industry could sue the Army. He said file sharing programs are a major liability because "Army employees are using Army equipment" to steal copyrighted material.

Information Management is trying to solve the problem as quickly as possible. The directorate is preparing to install an Intrusion Prevention System, which will recognize and forbid such network traffic. The system will isolate the computer downloading or uploading copyrighted material and then administrators will report the offender to commanders for disciplinary action.

Officials are still trying to curb commercial instant messenger programs, which are also unauthorized for Army computers. Companies like Yahoo! and Microsoft offer free instant messengers, but they subject computers to similar vulnerabilities as file sharing programs.

Army Knowledge Online and a few other Defense Department sponsored programs offer acceptable instant messenger programs.

New employees should contact their Information Management Officer to verify their computer programs are legal.
http://www.dcmilitary.com/army/penta...s/27067-1.html


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More on Real's Store, and Free Use v. Fair Use
Derek Slater

DRM Watch is more suspicious of Real Player 10's interoperability with iTunes songs, asserting that it might violate the DMCA. I still don't understand the mechanics of it precisely (see previous post and News.com article) - I'll try to find more out later.

Brad Hill now has his review up. Not quite a ringing endorsement: "RealPlayer10 Music Store is a heinous experiment in proprietary formatting that, even if it worked as advertised, would harshly constrain consumer value. Once again, RealNetworks is taking money for (or through) a broken beta program."

Only slightly related: Here's a line from the DRM Watch article that exemplifies how twisted the concept of fair use has become: "No one would argue that this [playing an iTunes Store song in Real Player] is unacceptable behavior or not 'fair use.'" For fair use to enter the picture, you have to implicate a right of the copyright holder. What right does playing a song implicate? Yes, you're copying the song into RAM, but that's true whether you use Real Player or iTunes. Playing a song in a player of your choice hasn't been - and, I'd say, shouldn't be - a copyright issue.

This is a point I've talked about before, and one that Professor Lessig stressed during his iLaw talk last year. To put it in his terms: forget fair use; what happened to "free use", use that copyright doesn't touch in the least? Today copyright holders have a right of access, a right to use, because of the DMCA. Not only does that set aside the fair uses we have, but it also eliminates many of the free uses.

In most discussions, though, fair use takes center stage. Fair use is now the umbrella term for all uses that are not infringement. And thus all uses are seemingly treated as conditional, riding on a case-by-case balancing test or copyright holder authorization. But there used to be this other zone of copyright too.

To some extent, this is all just semantics - people who say "we need to protect fair use" often mean that we should move more fair uses into the category of free uses, perhaps by legislating clear, affirmative consumer rights. That's all well and good, but it's worth remembering that having this grey area of fair use is also good. We need a balancing test, too, to deal with evolving uses. So, I think, both conceptually and legally, it's worth retaining this separation of fair use and free use.
http://blogs.law.harvard.edu/cmusings/2004/01/16#a565


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Microsoft Forced to Change Music Buying Browser Software
AP

Microsoft Corp. has agreed under pressure to change its Windows software to resolve complaints by the Justice Department that it unfairly influenced how customers buy their music online, the government said.

Microsoft will offer updated software for its Windows XP operating system in February or March to stop its disputed practice of compelling consumers who buy music on the Web to use only Microsoft's Internet browser.

The company continues to say its design is legal.

Government antitrust lawyers concluded that the design violated a landmark antitrust settlement approved by a federal court in October 2002.

Microsoft shares fell 16 cents to $27.54 on Nasdaq.
http://www.latimes.com/technology/la...nes-technology


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Microsoft Takes on Teen Over Web Site
AP

Mike Rowe thinks it's funny that his catchy name for a Web site design company sounds a lot like Microsoft.

The software giant, however, is not amused.

"Since my name is Mike Rowe, I thought it would be funny to add 'soft' to the end of it," said Rowe, a 17-year-old computer geek and Grade 12 student in Victoria, British Columbia.

Microsoft Corp. and its attorneys have demanded that he give up his domain name, the Vancouver Province newspaper reported Sunday.

Rowe registered the name in August. In November, he received a letter from Microsoft's Canadian lawyers, Smart & Biggar, informing him he was committing copyright infringement. He was advised to transfer the name to the Redmond, Wash.-based corporation.

"I didn't think they would get all their high-priced lawyers to come after me," Rowe said. He wrote back asking to be compensated for giving up his name. Microsoft's lawyers offered him $10 in U.S. funds. Then he asked for $10,000. On Thursday, he received a 25-page letter accusing him of trying to force Microsoft into giving him a large settlement.

"I never even thought of getting anything out of them," he said, adding that he only asked for the $10,000 because he was "sort of mad at them for only offering 10 bucks."

He said family and friends are backing him and a lawyer has offered to advise him for free. He's also keeping his sense of humor.

"It's not their name. It's my name. I just think it's kind of funny that they'd go after a 17-year-old," Rowe said.

Company spokesman Jim Desler said Sunday, "Microsoft has been in communication with Mr. Rowe in a good faith effort to reach a mutually agreeable resolution. And we remain hopeful we can resolve this issue to everyone's satisfaction."
http://story.news.yahoo.com/news?tmp...rosoft_unhappy


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CinemaNow Debuts Download-To-Own Movies
Stefanie Olsen

CinemaNow, an online movie rental company, is testing new waters by launching a service that lets people buy permanent downloads of Hollywood films for a PC.

As part of a Web site overhaul, the company added on Thursday several features to its digital movie service for PCs. It introduced a download-to-own feature, or what's called "digital sell-through," which lets people buy and download a permanent copy of a film for unlimited playback.

"Allowing users to download and own DVD-quality versions of video content is the next great frontier in digital distribution," CinemaNow CEO Curt Marvis said in a statement.

Customers can also choose to subscribe to a monthly service or watch movies on a pay-per-view basis.

CinemaNow and rival Movielink, a Hollywood-backed venture, face hurdles when it comes to drawing customers. One is that people are accustomed to watching feature films on a big screen--not on a PC display. Broadband adoption and advances in technology have improved prospects for the online movie business, but it is still at a disadvantage.

By exploring a range of service models, CinemaNow should be able to gauge consumer demand for new distribution methods and potentially change viewers' habits. The company provides a legal alternative to downloading pirated DVDs--a source of mounting concern for CinemaNow's Hollywood studio partners.

"Will this change the economics of Hollywood? Absolutely not," said Steve Vonder Haar, an analyst at Interactive Media Strategies, an Arlington, Texas-based market research firm. "But it helps the technology and entertainment sector begin to learn a little bit more about what content models are doable and appealing to consumers over the long haul," he said.

As part of its site changes, CinemaNow introduced progressive download capabilities for broadband customers. These are designed to let people begin watching a newly rented movie within 30 seconds of the start of the download. The technology also lets people view films when they're not connected to the Internet.

CinemaNow's store of download-to-own films--which includes the surf documentary "Endless Summer"--is protected by Microsoft's Windows Media digital rights management software, according to the Marina Del Rey, Calif.-based company. People with Windows XP Media Center can watch CinemaNow downloaded movies on a television set; and in the second half of 2004, they will be able to view them on a compatible portable device with Microsoft's upcoming Portable Media Centers, via USB 2.0.
http://news.com.com/2100-1026-5141683.html


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Congressional Leaders Promise Action On Tech
David Becker

Federal lawmakers are ready to help the technology industry solve its problems--at least some of the issues.

That was the consensus from eight U.S. senators and representatives gathered Friday for a panel at the Consumer Electronics Show. Congressional leaders vowed concerted action on some hot-button tech issues, but warned attendees not to expect too much.

Some of the most vigorous debate focused on trade policy, with speakers describing a balancing act between encouraging free international trade and preventing an exodous of U.S. jobs to overseas locations.

Rep. Tom Davis, R-Va., said misguided concerns about jobs are setting the agenda now. "What we're seeing is a continuing assault on free trade," he said, adding that some lawmakers "want to punish companies that do business offshore."

"We've been in defense all year," Davis said. "The AFL-CIO is out there--they're taking book on this."

But Rep. Steve Buyer, R-Ind., warned that fellow free-trade Republicans shouldn't make the mistake of thinking the jobs issue isn't real. "There's some realities out there that hurt Americans," he said. "There's a beginning of the erosion of the middle class in this country."

Debate was more unified on intellectual property issues, with lawmakers saying that while Congress will continue to support strong copyright protection, media industries need to come up with their own solutions to file-swapping and other issues.

Sen. John Sununu, R-N.H., joined others in criticizing the Recording Industry Association of America (RIAA) for suing alleged music swappers, calling the RIAA's legal tactics heavy-handed and against the intent of U.S. copyright laws, including the controversial Digital Millennium Copyright Act (DMCA).

"The fundamental problem with the approach of the RIAA took is that it was based on legislation that created special property rights," Sununu said. "Suddenly, you had a private entity that's able to issue subpoenas, which is unprecedented."

"That's not what the DMCA was intended to do," he said. "We can't be writing legislation that gives holders of certain types of intellectual property special rights...We can't carve out special legislation to give special powers to certain types of content."

Rep. Joe Barton, R-Texas, said it's up to content creators to come up with business models that accommodate modern technology and attitudes. "I don't agree you're going to get teenagers and young people to believe they're doing something immoral" in file swapping, he said. "The industry has to decide on a different model."

Lawmakers also spoke in support of moratoriums on taxing the Internet, with Sen. George Allen, R-Va., saying lawmakers need to be vigilant against efforts by state and local authorities to grab a chunk of broadband service fees.

Sununu said those same force are hungry to take a bite out of the emerging market for Internet-based telephone service. "I think the most important policy issue we'll be dealing with over the next few months is voice over IP," he said. Sununu said Congress' job is "to try to protect it from taxation, to define it as an information service, so the technology can grow."
http://news.com.com/2100-1028-5138908.html


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Don't Sue Me, I'm Only The Piano Player
BBC

Suing for file-sharing is only the start and soon we could be paying to sing Happy Birthday in a restaurant, argues technology analyst Bill Thompson.

The British Phonographic Industry has said it is thinking about following the example of the Recording Industry Association of America and may soon sue its customers if they dare to share music over the net.

The threat is all part of the ongoing attempt to perpetuate the belief that declining sales of CDs are due to the widespread copying of unlicensed MP3 files.

Nevermind the lower number of new releases, the lack of any interesting music, or the fact that all of us over 40 have now finished buying CD versions of our vinyl albums.

Despite the lack of real evidence that file-sharing is the problem, and ignoring data from Jupiter Media Metrix that file sharers actually buy more CDs than other people, the record industry is taking legal action against those who swap files.

It seems to have had some success in the US.

Employers, colleges and even parents are so worried about the prospect of being sued, they are clamping down hard on any use of file-sharing peer-to-peer networks, even perfectly legal ones.

And now it could happen here.

Controlling technologies

A big part of the problem is that the few people see the connection between consumption and creativity.

We are still stuck with a view of the world in which most of us are passive consumers of other people's creative output.

So, controlling distribution and re-use makes good commercial sense, and we seem to be losing little other than free copies of music that we should be paying for.

Who knows what creativity could be unleashed by the growth of digital distribution and the widespread availability of programs to create, sample and manipulate content

Yet one of the most significant differences between analogue and digital media is the ability to take digital content and manipulate it ourselves.

It can be as simple as editing the adverts out of a programme, re-arranging the order of the tracks on a CD, or creating new versions of movies.

The Phantom Edit, a re-cut version of Star Wars: The Phantom Menace - but without Jar-Jar Binks - was an online hit in 2001.

Even though it was technically an infringement of copyright, George Lucas did not pursue its makers or distributors.

One way medium

The lack of interest in the creative use of digital media was brought home to me earlier this week at the Oxford Media Convention, hosted by the
think-tank, the Institute for Public Policy Research.

Despite the presence of the BBC's own director of new media Ashley Highfield, and a few other net luminaries, the "media" everyone was concerned with was really one medium, television.

Even the discussions on digital TV concerned ways to get everyone to switch over, and how to make sure that people with second sets would be all-digital.

There were exceptions. In one session about copyright, Stanford law professor Lawrence Lessig compared the current situation to the early days of photography.

When Edwin Land invented paper based film in 1884, it was a technical revolution that made photography widely available.

It took it out of the hands of the professional elite who had been able to afford the large plate cameras of the time.

But the revolution was almost derailed in the US by a lawsuit which argued that photographs of people should only be taken if prior permission was granted.

Fortunately, the courts decided that photography should not be restricted in this way, and the result was the massive growth in the sales of cameras and film, as well as the growth of photos.

Birthday troubles

When it comes to music, things seem to be going the other way.

If you want a wedding video then your video-maker will have to pay out about £80 to license the background music, even though it is for personal use.

If I make a home video of my daughter's birthday party in a local restaurant and put it online for the family, I could be in trouble for using the restaurant's logo.

I could also be in trouble for recording an unlicensed performance of that well-known - but still copyrighted - song, "Happy Birthday".

Who knows what creativity could be unleashed by the growth of digital distribution and the widespread availability of programs to create, sample and manipulate content.

But if we treat copyright as an absolute property right, and allow the limitations on re-use forced on us by digital rights management technologies, we will never find out.

Governments today are giving the music industry everything they want.

That is understandable over in the US, where campaign financing means that lobbying and corporate interests have massive influence over policy-making and legislation.

But over here things are not that bad, and it should be possible to campaign effectively against these dangerous and damaging laws.

Otherwise I can see the day when I will have to sign a license and pay a fee before I let my daughter's friends stand up and sing to her on her birthday, unless I want to face the possibility of a lawsuit.
http://news.bbc.co.uk/1/hi/technology/3403157.stm


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York Community News

COMPUTER COURSE

Aurora library presents Peer to Peer Sharing, the fourth of a 10-part monthly series of free computer workshops held the third Wednesday of each month (Jan. 21), 7-8:30 p.m., between September and June. Register online at the adult info desk or call.

http://www.yorkregion.com/yr/newscen...-1916094c.html


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Did Big Music Really Sink The Pirates?
Brian Hindo

The Recording Industry Association of America's lawsuits against online song swappers are aggressive, but do they work? Two widely cited surveys seemed to show that legal action, which began in September, was chilling file-sharing activity. In December, a phone survey by the Pew Internet Project of 1,358 U.S. Net users found music downloading had dropped by half since May. And in November, comScore Media Metrix, monitoring 120,000 U.S. users, saw big yearly declines at four popular file- sharing services -- KaZaA, Grokster, BearShare, and WinMX.

Trouble is, those surveys provide a relatively narrow view of the file-swapping universe. BayTSP, a Silicon Valley watchdog that works for three of the major record labels, tracks the number of songs available for download worldwide. It sees just a 10 percent drop since July and also notes steady migration from older, virus-ridden programs like KaZaA to hipper peer-to-peer networks such as eDonkey and Bit Torrent -- which were absent from comScore's tally.

And Los Angeles-based researcher BigChampagne, which monitors millions of global file swappers, actually sees a 35% increase in illegal traffic from 2002 to 2003. Given BayTSP's and BigChampagne's broader sample sizes, says John Palfrey, of Harvard Law School's Berkman Center for Internet & Society, "They're going to have more accurate empirical data."

FLEXIBLE ARCHITECTURE. What explains the apparent discrepancies? Many analysts point to Pew's methodology -- phoning U.S. adults, who may be reluctant to self- report an illegal activity. Concedes Pew analyst Mary Madden: "It's quite possible that some people simply didn't want to admit to downloading now."

And comScore analyst Graham Mudd says he would expect different results had the study included overseas users and more services, whose constantly evolving network architecture make detection more difficult. Still, BigChampagne CEO Eric Garland says, "The Pew study underscores the dramatic and definitive effect" of the RIAA campaign. Indeed, the RIAA declined to comment on the surveys but says its own studies show increased public awareness of the lawsuits "and the consequences."

If the perceptions have changed, the reality is that the RIAA's suits have targeted only uploaders of music -- that is, people who make files available for others to copy. No one has yet been sued for simply downloading an MP3 file to his or her PC.

"TALMUDIC QUESTION." And amid the continued resilience of the file-sharing set, the decline in record sales is abating. According to Nielsen SoundScan, in 2003 CD album sales slipped 2 percent -- a less dramatic drop than the 9 percent slide the previous year. Also, fourth-quarter 2003 sales picked up 5.6 percent over 2002. So what does that do to the record industry's long-held argument that online piracy is killing music sales? "That's almost a Talmudic question," muses Michael McGuire, a Gartner G2 analyst.

Some observers, such as BigChampagne's Garland, believe it punctures the myth that downloading a song and buying a CD are mutually exclusive events. "This really is forceful evidence that those are independent variables," he says. In fact, Garland points out that BigChampagne's list of the most-downloaded songs tracks closely to the Billboard charts, which in part rely on sales totals.

Others, such as McGuire, maintain that file-trading is but one of many factors that conspired to dampen music sales. Others include pricing issues, the ubiquity of CD- recording drives on PCs, and fewer new CD releases.

NOT FADE AWAY. What's clear, though, is that until the music industry gets fully behind online music sales, file-swappers will flock to next-generation sites like eDonkey -- which has seen 150 percent growth in the past year, according to independent tallies by both BayTSP and BigChampagne.

"This stuff is not going to go away," Gartner's McGuire says. "The industry needs to provide a compelling legal alternative." Until that happens, pirates will continue to rule the online music seas.
http://www.hispanicbusiness.com/news...d.asp?id=14417


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Music Exec Says 'Hey Ya!' to Music Downloads
Bernhard Warner

A top music executive on Thursday said strong music download sales over Christmas from artists like chart-topping hip-hop Outkast with their hit "Hey Ya!" have set the beleaguered industry up for a promising year.

"The market is exploding, and as more significant retailers join the fray, we expect this market to continue to grow," said Larry Kenswil, president of eLabs, the new business and technology division of the world's largest music label, Universal Music Group .

"And Europe is next. Just about all the players roaring in the U.S. are preparing to come here. There is no reason to think they won't be just as successful here," he said, addressing a gathering of media and technology executives at a conference hosted by the Royal Society for the Encouragement of Arts.

Industry observers say it is far too soon to call a recovery. The $30 billion industry is bracing for a fourth consecutive year of declining sales as they struggle to find a solution for online piracy and win over a consumer base that spends more on DVDs and video games.

Still, the small, but growing demand for music downloads on such online music stores as Apple Computer's iTunes and Roxio's Napster and RealNetworks Liquid Audio offers a rare glimmer of hope for the battered industry.

THE FIRST MEANINGFUL YEAR

Outkast's "Hey Ya!" was the most downloaded song for 2003, with over 110,000 downloads, Kenswil said. The artists, signed to the BMG label Arista, hold the new distinction of topping the virtual and real-world charts.

In the Christmas week, 2.5 million songs were downloaded by U.S. consumers and 30 million songs were downloaded for the full year, said Kenswil, citing data from Nielsen Soundscan, which tracks U.S. music sales.

Last year, Kenswil said, was the first significant year for music downloads. Major industry-backed download services began in previous years, but were largely ignored by consumers as they carried a meager song library and a confusing array of tariffs.

The European market is small, too, as the likes of Britain's OD2 struggle to win over paying consumers from file-sharing networks such as Kazaa and eDonkey. Industry executives believe the likes of iTunes and Napster will arrive in Europe by summer. With an average price of 99 cents per song, the U.S. download market, far and away the world's largest, represents a minute fraction of total sales. But record executives are optimistic the recent success of online music stores in America will catch on in other territories.

"Record companies cannot compete with free, unless we have compelling consumer services," Kenswil said.

Kenswil said the best-selling bands in stores are also topping the charts online. But, he added, obscure artists who rarely sell a CD in stores are selling online.

"Apple has sold almost every track they have. Even the most obscure thing -- someone has bought it," he said. "All of this data, we're just starting to dig into it."
http://reuters.com/newsArticle.jhtml...toryID=4134582


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Full Circle: Morpheus Back On Fasttrack

Building bridges between P2P networks
John Borland

New file-swapping applications are bridging formerly separate networks, promising to improve the efficiency of peer-to-peer searches and sharpen competition among rival software developers.

On Thursday, StreamCast Networks released a new test version of its Morpheus software. The application, for the first time, taps into all the major file-trading networks, including Kazaa, the world's largest, from which StreamCast was unceremoniously ejected several years ago. Other, smaller software programs such as Shareaza and the Macintosh-based Poisoned have had similar multinetwork search capabilities for some time, but StreamCast is the first major commercial company to go this route.

Peer-to-peer interoperability could provide a boon for end users, because it could give them access to a wider variety of content and swapping partners. But it also could be a setback for companies, such as Kazaa distributor Sharman Networks, that include advertising and other commercial features. If Morpheus and other companies successfully offer universal peer-to-peer searching, they could immediately match, or even exceed, the available library of files on rival networks, regardless of how many people use their software.

The drive toward building bridges between networks appears well under way, driven by independent, noncommercial programmers as well as companies seeking to capture the benefits of Kazaa's huge user base for themselves.

"I think everyone is going to have to start moving in that direction," said Jed McCaleb, chief developer of the eDonkey and Overnet applications, which Net measurement companies say are overtaking Kazaa overseas. "There are benefits of supporting other networks, because there are so many people in them."

StreamCast's move, in particular, spotlights the ongoing tension between pure technological progress and an often-bitter sparring between the top commercial peer-to-peer developers.

The company's Morpheus software was once the most popular of the post-Napster file-swapping services, but it used the same technology--called FastTrack--as Kazaa. After a dispute over software licensing, Morpheus users were overnight ejected from the network. The company's popularity plummeted as it shifted to open-source technology, and Sharman Networks' Kazaa became file swapping's unrivalled leader.

Kazaa has been downloaded more than 315 million times, while Morpheus has reached 119 million, according to Download.com, a software aggregation site owned by News.com publisher CNET Networks.

By offering searches of all the major networks, including its most bitter rival, StreamCast hopes to recapture the top spot in the business by making comprehensive search results its hallmark.

"Google does a great job for search results on the Web," StreamCast CEO Michael Weiss said. "We hope to do as good a job on the edge of the Net."

However, some critics warn that bridging networks this way can have risks, too. Bringing many new people onto a network can bog down or even destroy that network, if newcomers are using flawed technology--and some open-source developers looking at Morpheus' new software are already sayint it could have devastating effects on the popular Kazaa network.

Sharman Networks executives say they're not happy about StreamCast's actions and are evaluating the software.

"On the surface, we're never comfortable when someone uses unauthorized, illegal code to tap into FastTrack," said Sharman Chief Technology Officer Phil Morle. "But we're not in panic mode."

The company has previously tried to stop distribution of versions of the Kazaa software, such as Kazaa Lite, in which independent programmers stripped out its advertising components. It has allowed the open-source Poisoned Project, for which open-source developers found a way to let Macintosh computers tap into the FastTrack network, to proceed.

P2P rising?
The bridging of the networks comes as entertainment companies are closely scrutinizing file swappers' behavior to see if a combination of lawsuits, education campaigns and the availability of legal content through services like Apple Computer's iTunes is finally putting a crimp in online piracy.

New data released Thursday by The NPD Group research firm have helped cloud a picture that has shown considerable drops in file swapping since the Recording Industry Association of America (RIAA) began suing individuals last fall.

According to NPD, both the number of households observed using peer-to-peer software and the number of individual consumers who report that they have used file- swapping software, have started climbing, after months of declines.

The number of households that have file-swapping services on their computers jumped 14 percent between September and November, the group said. Separate survey information, gained from interviews with consumers over the same time period, estimated that the number of individuals who had downloaded music from file-swapping services rose from 11 percent to 12 percent of the population of computer users over 13 years old.

That's still substantially lower than the 20 percent mark reached last May, but it may indicate that the effect of the RIAA's lawsuits is wearing off, NPD said.

Another recent survey, conducted by the Pew Internet & American Life Project, found that only 14 percent of Americans said they had downloaded music from a file- swapping network in December 2003, compared with 29 percent in a sample taken in March, April and May of 2003.

Building bridges, building trust
The drive toward interoperability has been under way for some time, but it is only now beginning to filter to the most popular file-sharing programs.

Peer-to-peer programmers say one of the most valuable resources a network has is people; more users mean more content--and a greater likelihood that any given search will get results. Adding bridges between networks is a natural way to increase the efficiency of file swapping at large, they say.

Indeed, some developers, including Microsoft itself, have foreseen using peer-to-peer technology as a complement or even a rival to traditional Web search technologies such as Google. Letting different networks talk to each other is one step toward this vision.

However, these bridges pose dangers as well. Allowing large numbers of people into what has been a fairly small network community can be disruptive from both a technological and social perspective--a little like bussing large groups of noisy tourists into an ordinarily placid town.

"These things are like communities of people," eDonkey's McCaleb said. "There is a lot of possibility and opportunity to cheat the network and mess up how things work or exploit it."

Even if social mores are followed, large numbers of new outside users hold the potential of destroying an older network, if they are using technology that is flawed in any way. For example, bugs in a file-swapping client could swamp a network with redundant search requests, slowing down everybody's connection, as happened in early versions of the Gnutella network.

One independent developer who has worked on open-source FastTrack technology said he has looked at the Morpheus version, and it is configured in a way that could be deeply destructive to Kazaa, iMesh and the other FastTrack-based networks.

"What they don't understand is the fact that they could actually damage the FastTrack network," said Julian Ashton, the former lead developer on the Poisoned project. "It's really bad."

Weiss said StreamCast has tested its new software to make sure that it doesn't have a negative impact on the new networks it is tapping into. It has deliberately turned off access to the Gnutella2 network while it continues testing, however. Consumers will be able to reach eDonkey, Overnet, Gnutella, Kazaa and other FastTrack-based networks.

Like many other free programs, the new Morpheus also is bundled with several third-party applications, including a search-focused toolbar that plugs into Internet Explorer.

Not quite detente
StreamCast's return to FastTrack access carries more than a hint of irony.

Morpheus' new access to FastTrack is done without permission, using an open-source project called MLdonkey, one of several independent projects that has tapped into the proprietary network after reverse engineering the Kazaa software. It also allows Morpheus users access to content from Altnet, an application that sells licensed content through Kazaa and--as of Thursday--Grokster.

Weiss said he's not worried about being shut out of the network again, since Kazaa parent Sharman Networks has spent considerable time in court proving that it does not control what happens on its network.

"It will be interesting to see if they attempt to" block us, Weiss said. "I think if they do, they are going to have some explaining to do."

Altnet Vice President Derek Broes said his company is examining the new Morpheus software but that he can't yet comment on the unauthorized access to his company's content.

"We are looking at this from a number of angles--technical, legal--and also with regards to Altnet's patents," Broes said.
http://news.com.com/2100-1032-5142626.html


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FBI Logo to Grace Music CDs
Jeff Leeds

The FBI is coming to the local record store.

The music industry has won permission to include the agency's logo in CD packaging as a warning against unauthorized copying, sources said. Record labels want to use the logo the way it is used by movie studios, which include an on-screen warning on home videos and DVDs.

The deal, hammered out by the Recording Industry Assn. of America and FBI Director Robert S. Mueller III, comes as record labels try to dissuade Internet users from sharing copyrighted music online. The labels have filed hundreds of lawsuits against people who allegedly shared music illegally.

How the logo will be displayed is up to individual labels, sources said. Many discussed placement of the logo — and a warning about possible criminal prosecution for illegal copying — on the back of the disc packaging. Label executives also have discussed including software that displays the warning when a CD is put into a computer.

The RIAA declined to comment. An FBI representative couldn't be reached.
http://www.latimes.com/technology/la...,4433462.story


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Prominent pornsters shocked, shocked!- by p2p.

Ron Jeremy Cuts E-Music Store TV Spot
Charles Farrar

Adult entertainment legend and AVN Hall of Famer Ron Jeremy has cut a television commercial for Canadian Internet music store Puretracks which warns against the alleged hazards - porn, viruses - of free peer-to-peer file- swapping networks.

Jeremy appears in the spot in a red velour jogging suit, directing an adult scene, in the background of a teenager's room where the kid is downloading music on his computer, oblivious to Jeremy and his activity, with the action freezing when Mom knocks on the bedroom door.

This spot and a companion spot air after 9 p.m. on parent-oriented programming, according to the National Post.

"The music sites that are out there right now and which are being used by teenagers, especially younger teens, are just riddled with pornography and viruses and spyware," Toronto agency Cyclops Partners president John Farquhar told the Post. "When we presented that information to parents, they were completely unaware of it. We had to find a way to put together a commercial that could simply and impactfully put that forward."

"It's a very clever scene," Jeremy told AVNOnline.com, adding he got a "nice plug" on Regis and Kelly Live. "A kid is downloading, and they advertise there'll be no porn and no viruses. Very friendly for children, parents will love it, and they show what will not happen.

"In one scene there's these guys dressed in black kidnapping the kid, they're the viruses, and it says this will not happen," he continued. "And right behind, I'm directing a scene with a bunch of porn stars, a couple on the bed dressed but sexy dressed, and when the mom comes in we freeze, I go 'Hold it!' And she walks out, and it's 'Action!' and we continue."

Jeremy said he didn't know what it was going to be used for, when he was first booked for the commercial spot, which has been played widely on Canadian television in the hours after 9 p.m. "I got called from the Canadian union which made a deal with (the Screen Actors' Guild) which I'm a member of," he said. "But a commercial's a commercial. And I don't want kids to look for music and get porn by accident. I'm a big fan of porn, but I think it's really wrong to try to get kids to see it in a very sneaky way. If you have to rely on that to get traffic, you should just go out of business."

Jeremy - whose friends include Lars Ulrich, drummer for Metallica, outspoken opponents of free P2P file networks - said he understands "both sides" of the peer- to-peer file swapping controversy, but believes it's unfair to recording artists and filmmakers whose work ends up in files swapped by the millions for free.

"I've followed the situation fairly well, I have good friends on both sides," he said. "It's a very tricky, tough call, because people get free music on radio, too. But I think one of the arguments says that it doesn't hurt record sales and actually inspires sales, but the recording industry isn't doing all that well right now. This is not a big cause for me, and I'm not 100 percent against it, I'm 70 percent against it, but I think it is unfair for recording artists."

Jeremy himself has had past work turn up on the original Napster - a film file and a rap recording he had done. "I rapped on this record, I owned some of the publishing on it, I joined BMI, I made some money on it, and it was on an album, Booty Base, and there it was on Napster. Actually, I was flattered. Hey, I was good enough to be pirated! But I probably lost a couple of checks because of it."

Critics of P2P, like the music and film industries and some lawmakers, have often accused the P2P networks of either consciously allowing adult material to pass through their networks or turning a blind eye to those materials.

Earlier this month, adult video production company Titan Media accused KaZaA of refusing their request to help keep kids from being exposed to adult materials that pass through that network. "(W)hen given the specific knowledge and tools to do so," said Titan parent IO Group's vice president Keith Ruoff in a letter to the Senate Judiciary Committee, "they refused to respond or take action."

Sharman Networks, KaZaA's parent, has testified on Capitol Hill that the P2P service "will take all other feasible steps to best assure that minors are not inadvertently exposed to adult content when using (KaZaA)."
http://www.avn.com/index.php?Primary...ntent_ID=69962


If it’s really so important that kids don’t see your porn – you could always stop making it.

"Help Us Keep Kids From Porn On P2P": Titan to Senators
Charles Farrar

SAN FRANCISCO - A week after first asking the Senate Judiciary Committee to turn up the heat on peer-to-peer networks through which adult materials pass, Titan Media is bracing for a potential defamation suit from KaZaA's parent company, over Titan accusations that the P2P giant doesn't try hard enough to stop kids from getting adult materials through its network.

In a new letter to the Judiciary Committee, Titan vice president Keith Ruoff says Sharman Networks threatened the suit "simply because we had the courage to ask for your help in solving this important issue." Ruoff also says in the new letter that a lawsuit threat won't stop Titan from trying to find ways to keep kids from accessing adult materials online.

Ruoff told AVN.com he'd heard almost nothing back from the Judiciary Committee from the current round. "We heard from Senator (Dianne) Feinstein (D-California), she sent a 'Dear Constituent' thank you letter and said they would look at it," Ruoff said. "It seems like every time we release something to the Senate, two or three days later some Senator releases something based on what we send them."

Ruoff was referring to statements from senators just days after Titan's first letter to the Judiciary Committee, in which these senators – whom he didn't name – called for peer-to-peer networks taking stronger filtering measures.

Sharman has not yet made a formal move on suing Titan, Ruoff said. "We got the threat," he said. "We're sitting here waiting for the bomb to explode."

Sharman executive vice president Alan Morris testified to Congress last fall that his company welcomes suggestions for ways to keep kids from unwanted porn exposure. "We will take all other feasible steps," he said, "to best assure that minors are not inadvertently exposed to adult content when using (KaZaA)."

Titan has all but invited Sharman to put its money where its mouth is – they have also sent the Senate committee a point paper suggesting ways KaZaA and other P2P networks could keep kids – and anyone else who doesn't want it – from seeing adult materials through its networks. Titan calls it a "Shun Filter," based on a file's unique hash identification, which remains the same even if the filename is changed.

"Every file that is traded, downloaded, shared, and distributed using KaZaA goes in and out through 'shared folders'," the Titan paper says. "All file-sharing traffic either originates or is destined for these key areas of storage on a user's home computer…Instead of looking for viruses, the 'shun filter' would look for the hash ID of files on the 'shun list.' The KaZaA software would then simply ignore these positively identified files, preventing them from being traded within the network or displayed in content searches performed by users."

Ruoff said P2P defenders who compare the file-swapping scenario to the Sony Betamax videocassette recorder case of 20 years ago miss a big distinction between the VCR and the P2P online swap network.

"Sony sold a Betamax to a user, and that was the end of their association with that user," he said. "The difference is, here, KaZaA gives out a free piece of software, but they don't make money until people use it. They have an ongoing relationship with a user, and that's how they make money. They don't profit until someone uses it for infringing purposes.

"And if we put in a filtering mechanism that was effective and filtered out the content – and we believe adult material should be available legally – but if we found our content, positively identified it, and notified them about it, they need to do something about it," he continued. "And if they continue profiting and we're going to do something about it."

The music industry, of course, continues "doing something about it" – the Recording Industry Association of America has sued 532 computer users it claims were distributing songs online illegally, in the first such suits since a federal appeals court blocked the use of copyright subpoenas to identify the targeted users. And it's the largest number of suits since the RIAA launched its litigation campaign last summer.

The suits were filed in New York and Washington, though the individual defendants are likelier to be living across the U.S., the RIAA said.

The defendants in question are said to have distributed an average of 800 or more songs each online, and face potential civil penalties or settlements that could cost in the thousands. The RIAA said the latest round was aimed at discouraging music fans who thought that appeals court ruling would make it harder to be stopped because of higher cost and effort by the music business.

"Our campaign against illegal file sharers is not missing a beat," said RIAA president Cary Sherman in a statement. "The message to illegal file sharers should be as clear as ever."
http://www.avn.com/index.php?Primary...ntent_ID=70798


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Apple's iTunes Might Not Be Only Answer To Ending Piracy

Steve Jobs is pretty smug about iTunes, but maybe he's got it wrong.
Kevin Maney

It's at least worth exploring, because so far the tech industry has treated Apple Computer CEO Jobs and his creation of iTunes much the way the Hebrews treated Charlton Heston after he parted the sea of Jell-O in The Ten Commandments. Praise be Steve! He has saved us!

Except now there's a daring young Web site called Magnatune that's asking some interesting questions about ways to finally create harmony between the Internet, music artists and consumers.

It suggests that iTunes and all the similar 99-cents-a-song sites from the likes of Dell and Musicmatch are just a waylay on a longer path. Eventually, that path has to lead to a business model that stops the ongoing insane war between the music industry and its customers - a war in which both sides continue to give each other plenty of reason to act stupid.

Magnatune was launched in May by John Buckman, who is otherwise CEO of e-mail software company Lyris. At its core, Magnatune is an effort to create the first real Internet-era record label. It's intriguing enough that Hank Barry, former CEO of Napster (news - web sites), took Buckman to lunch a couple of weeks ago to learn about the company.

Magnatune doesn't have all the answers. But its model reveals how the Internet, CD burners and inexpensive digital recording technology are undermining the music industry's economics to a greater degree than most people realize.

The questions about current models start with pricing. Why, in this era of eBay, is all music priced the same? A new track from White Stripes can't be worth the same 99 cents online as an old Bread recording of Baby I'm-A Want You. (No quips from the peanut gallery about which is worth more.)

The Internet makes dynamic pricing possible - prices that change depending on demand. EBay's auctions are one way to do it. Magnatune is trying something a little different, and it includes playing on a buyer's conscience.

When you go to Magnatune, you find a list of a few dozen artists the company has signed. They are not famous. (About one in 300 artists that send music to Magnatune get signed - the idea is to maintain a level of quality.)

Click on an artist such as Falik - who plays electro-Indian music and may or may not intend his name to be a homonym - and you can listen to his album for free by streaming it over the Internet. It works like an on-demand radio station: You're not downloading the music onto your computer's hard drive, and you don't own it.

To download an album so you can play the songs any time or burn them to a CD, you have to buy it. When you click to buy, you see a "suggested" price of maybe $8, but you can choose to pay as little as $5, or as much as you want. Here's what's fascinating: "Everyone assumes we're just getting $5," Buckman says. "The average is $8.93."

Buckman is convinced his customers are willing to pay for - not steal - his artists' music, and even pay more than is necessary, because Magnatune pays artists half its revenue from selling music.

Which brings into play another layer of the Magnatune model. In decades past, it cost a lot to get recorded music to the public. Studios and equipment were expensive, so recording an album took a lot of upfront money. Then, manufacturing thousands of LPs or CDs and shipping them around the country cost a ton.

It all meant artists had to sign with a record label that would advance the money to launch an act. The price to artists has often been restrictive contracts that pay little royalties.

But every part of that model is changing. PCs, digital gizmos and software can be assembled into a high-quality basement studio for a few thousand dollars. Former Byrds legend Roger McGuinn is recording his next album on his laptop while on the road. And with high-speed Internet, CD burners in most every PC, and blank CDs that cost 30 cents, it makes little sense to manufacture and ship pieces of plastic. It's like, in the 1940s, when the first refrigerator/freezers made home ice delivery irrelevant.

Bottom line for Magnatune: It can sign artists who have already recorded their albums, advance them nothing, then split all purchases 50-50. If you pay $8, the artist gets $4.

The 50-50 deal is spelled out on the Magnatune site. Consumers, Buckman says, want to support artists.

But they don't want to support the Recording Industry Association of America (news - web sites) (RIAA) and the music industry, which they see as the enemy. People are willing to steal music from music companies but not from artists, Buckman says. Considering the outrage in 2003 over the RIAA suing a 12-year-old girl for downloading music, he's probably right.

Magnatune is taking advantage of this zeitgeist with a certain glee. Its slogan: "We are not evil."

Buckman is even embracing some of the more radical aspects of Internet culture. One is open source. Because music now is digital code, why not allow people to take it apart, improve on it, use it to make something new? Magnatune's contracts with artists allow for certain kinds of sharing. "We want to be the Linux (news - web sites) of the music world," Buckman says.

Now, nobody suggests Magnatune is going to overtake iTunes or the major record labels. "It probably won't get past a certain point because the music is obscure," says Mark Coleman, author of Playback: From the Victrola to MP3, 100 Years of Music, Machines and Money. But the model should make the music industry take notice.

Yes, compared with the lame attempts to sell music online before, iTunes is a breakthrough, and it is popular.

Still, it sells music from major labels that operate much the way they have since Elvis recorded Blue Suede Shoes. Jobs admits iTunes loses money. Consumers still steal: BigChampagne, a service that the music industry itself uses to monitor file swappers, reports a 35% increase in illegal traffic in 2003. And the RIAA threatens another round of lawsuits against consumers.

It's still broke. Jobs hasn't fixed it.
http://story.news.yahoo.com/news?tmp...toendingpiracy


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Untraceable File Sharing Inspired by Ants
Paul Eng

Like ants foraging for food, the requests continue on their way across the network. When the file is finally located on the network, the computer that has the file sends the message back to the nearby computer that sent the request, which then passes it to the computer that it received the request from and so on.

An invasion of ants has become the unlikely inspiration for what may be an untraceable way to trade files online.

Since last September, the Recording Industry Association of America (RIAA) has filed over 380 copyright infringement lawsuits against suspected online music pirates in the United States. And the effect has been chilling. A recent Pew survey of online users found just 14 percent still downloading music files from so-called peer-to-peer, or P2P, networks such as KaZaA, compared to 29 percent a year ago. Many cited fears of being nabbed as online "pirates."

Still, the legal clampdown hasn't stopped others, according to a recent survey by market researcher The NPD Group. As many as 12 million individuals claimed to have downloaded music illegally in November -- a 9 percent increase in the number of pirates reported in a September survey. Now Jason Rohrer, a 26-year-old programmer in Potsdam, N.Y., thinks he has a way to really boost file-sharing back into popularity.

When Rohrer was living in Santa Cruz, Calif., and studying for a master's degree in computer science, he noticed a trail of ants had invaded his indoor Ficus tree from the front door. No matter how he tried to destroy the trail -- sweeping daily, or blocking the path with chalk or hot pepper -- the ants always figured a way around the obstacle to the tree.

"I read about how they use pheromones -- chemical scents -- to create the trails and how it's used by the colony," says Rohrer. And it inspired him to see if the same "swarm intelligence" could be applied to how programs work over the Internet.

The result: MUTE, freely-available software for a P2P system that Rohrer maintains is almost as hard to trace and stop as, well, ants at a picnic.

Like Foraging Ants

In current P2P networks such as KaZaA and Grokster, software identifies each computer on the network using Internet Protocol (IP) addresses -- a string of numbers similar to a telephone number.
When a member searches a P2P network, the request -- say for music by Britney Spears -- goes out across the network. Computers that have the requested files send a response back directly to the computer that made the request using the IP address.

Files are traded directly between computers in small packets using the IP addresses -- making it extremely easy to track.
But MUTE's system has several different ways to thwart tracking efforts.

First of all, each computer on the MUTE network is "addressed" by a random string of characters and numbers. And each time a computer connects to the MUTE network, a new random address is generated. When a MUTE member searches a file, Rohrer says the request goes out from the originating computer only to nearby computers the program knows about. If the files aren't found there, the MUTE software on those nearby computers then sends out requests to the next set of computers they know about.

Like ants foraging for food, the requests continue on their way across the network. When the file is finally located on the network, the computer that has the file sends the message back to the nearby computer that sent the request, which then passes it to the computer that it received the request from and so on.

Rohrer says MUTE's setup offers several advantages over current P2P networks. For one, chances of finding and retrieving a particular file across the network might be increased since each computer on the network is actively looking and sending data back to the originating computer.

Rohrer compares it to sending a message using the old "telephone" party game. "Let's say you're in a room crowded with people, one of whom is someone you know," says Rohrer. "To reach that person, you ask the seven people next to you to pass a written message to that person. They may not know the person or where he is in the room, but in turn, they'll copy and pass the note to the people closest to them and so on. Eventually, the person you want to reach gets the message because you've covered everyone in the room."

What's more, such a system offers another layer of anonymity to user. In order for parties such as the RIAA to track such requests, the organization would have to monitor every single computer on the MUTE network. Rohrer says he initially didn't design MUTE as a blatant challenge to the RIAA and its efforts to stop piracy. But he says he was troubled by the recent RIAA lawsuits, which he believes trampled on individuals rights to privacy .

"It's a scary environment to be living in when an organization like the RIAA can just snoop on what you're doing online," says Rohrer. "I've created a piece of software that helps people protect their privacy."

But even he admits that for the privacy and other possible advantages a MUTE network would offer, there are plenty of downsides as well. For now, MUTE has garnered only a very small group of users. Since its initial released last month, just about 32,000 have downloaded the program to establish the fledgling P2P net. That hardly a drop in the bucket compared to the millions of computers running KaZaA or Gnutella worldwide.

And there's no guarantee that if the network gets bigger, it will become as powerful as other file sharing networks. In fact, Rohrer admits that MUTE may become terribly inefficient if too many computers -- each generating its own messages as well as passing along search requests from all the other computers on the network -- join up. What's more, there are questions if such a network would survive any legal battles in the ongoing war between the RIAA and purported music pirates.

Last month a U.S. District Court had ruled that the lawsuit tactics used by the RIAA to obtain user information from ISPs was illegal, marking a small victory for advocates of privacy.
But in a reaction statement released by RIAA President Cary Sherman: "This decision in no way changes our right to sue, or the fact that those who upload or download copyrighted music without authorization are engaging in illegal activity. We can and will continue to file copyright infringement lawsuits against illegal file sharers."

So while Rhorer's tiny, experimental Mute network has escaped the attention of the RIAA so far, there's no guarantee that the music industry will challenge him and his creation much like they did Shaun Fanning and his Napster creation. And that leaves it unclear if MUTE will become the latest pest to the RIAA's attempts to thwart piracy, or squashed like the insect that inspired it.
http://www.technewsworld.com/perl/story/32632.html


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Intel Pursuing Much Faster Home Internet Access
John Markoff

Intel, the world's largest computer chip maker, is pushing forward with a new wireless technology that it says it believes can bring extremely high-speed Internet access to American homes, a promise once offered by fiber optic networks.

Sean Maloney, general manager of Intel's wireless division, said on Wednesday that Intel saw enormous promise in a new technology known as WiMax and would produce chips that use that technology. At a speech on the opening day of an annual technical symposium sponsored by the Wireless Communications Association, a trade organization of equipment makers, Mr. Maloney said that growth in wireless communications would be as fast as the Internet expansion of the mid-1990's.

"It looks like the Internet in 1994," he said. "The next 10 years will be defined by broadband wireless."

Intel is hoping that broad deployment of the WiMax standard will allow it to repeat the success it has had selling its Centrino microprocessor chip, which uses Wi-Fi, or 802.11 technology. Intel has spent $300 million in the last year advertising its Centrino wireless technology for portable computers, and its venture capital arm, Intel Capital, has invested more than $4 billion in a range of wireless data ventures.

While Wi-Fi is now the international standard for home and office wireless networking, Intel executives say they believe that WiMax, or 802.16 technology, can have an equal or greater impact on the future of data transmission.

Indeed, the recent Consumer Electronics Show, held this month in Las Vegas, was a showcase for wireless technologies that are being used in everything from hand-held video players to televisions. And last week at the Sundance Film Festival in Utah, Intel showed a digital movie that was broadcast wirelessly to large flat-panel displays, demonstrating wireless video transmission.

"Most people don't think of them this way, but we believe that Intel is one of the most important companies," said Craig J. Mathias, a principal analyst with the Farpoint Group, a wireless industry consulting firm based in Ashland, Mass. "They will do to the wireless industry what they have done in computing."

Intel's strategy has long been to nurture computer applications to drive up consumer demand for more powerful computer chips. But the relatively slow adoption of broadband Internet access to the home, Mr. Maloney said, has delayed the widespread use of advanced applications like video-on-demand via the Internet that require high-speed connections.

He said that 65 percent of American households with Internet access still do not have broadband connections, and that hopes for broader deployment of high-speed fiber optic lines were fading. "There is no great fiber build-out going on," he said. "Some kind of wireless capacity is necessary to reach the last mile."

The time for laying fiber optic lines to the home has passed, he argued, because deployment costs have skyrocketed in recent years. It can now cost as much as $300 a foot to lay fiber optic lines.

During his speech and afterward in an interview, Mr. Maloney acknowledged that WiMax technology was not yet proven and that the radio spectrum needed to deploy the new technology at reasonable costs was not yet available.

He also conceded that efforts during the last decade to provide wireless data transmission using other technologies had largely ended in commercial failure.

"This stuff is obviously difficult," he said. "You have every right to ask how are we going to do this. You have the right to be skeptical."

Mr. Maloney also noted that the cost of deploying wireless connections was sharply higher when the service was offered at higher radio frequencies, because more antennas were needed to cover the same area. The frequencies available for new technologies are generally higher ones, which offer less than optimal performance over longer distances; most of the more desirable parts of the spectrum have been licensed for other uses.

Still, Mr. Maloney said he was confident that WiMax would catch on, because it could offer competition to cable and telephone companies selling high-speed Internet access. Intel has announced several American equipment partners for its WiMax technology and is working with eight foreign telecommunications service providers. But it has not announced any partners in the United States to offer service.

The company said it had run a small test of an early version of WiMax in Plano, Tex., last fall and would conduct larger-scale urban trials in 2005. Intel recently placed a WiMax antenna on top of its corporate headquarters in Santa Clara, Calif., and Mr. Maloney said he was able to receive a 7-megabit data signal - enough to view high- definition television- from the hills above Silicon Valley, more than 12 miles away.
http://www.nytimes.com/2004/01/22/te...pagewanted=all


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TrustyFiles Delivers Public AND Personal File Sharing

Software provides easy-to-use file sharing with friends, while giving access to millions of files on the P2P network.
Press Release

RazorPop, Inc. today announced the release of TrustyFiles 2.0 Personal File Sharing software at http://www.TrustyFiles.com. TrustyFiles is free and has no spyware.

Traditional P2P software limits users to connecting to a large anonymous file sharing network. There's no way to share files directly with friends. TrustyFiles solves this problem and puts the user in control with Personal, Private, and Public File Sharing settings.

"File sharing is not just cool technology", said Marc Freedman, CEO of RazorPop, developer of TrustyFiles. "It's about the experience, exploring new music, video, and other media, trying new files your friends recommend, and sharing it back. This is the process that creates the fans who buy CDs and DVDs, go to performances, and support their favorite artists. P2P software should enhance and not restrict this experience."

"Only TrustyFiles offers users the power and flexibility to share and download files on their terms - when, where, and how they want it. Whether they want to search millions of files or download one file from a friend, find files at home or at work or share files with the entire network or just friends."
http://www.digitalvideoediting.com/2...w_razorpop.htm


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Compulsory Licensing vs. the Three

"Golden Oldies"

Property Rights, Contracts, and Markets
Robert P. Merges

Executive Summary

From its inception in the U.S. in the early 20th century, compulsory licensing has been seen as a means of making intellectual works available by reducing some of the transaction costs associated with obtaining permission to use copyrighted material. There are now increasing calls for compulsory licensing for digitized works on the Internet, particularly music.

Conceptually, a compulsory license falls midway between granting full copyright, which gives owners broad control, and denying copyright protection altogether.

Rather than allowing musicians, artists, and other copyright owners to negotiate licensing terms for use of their works, a compulsory license forces copyright owners to allow use of their works under legislatively set prices and restrictions on use.

When warring groups sound the alarm over excessive control via copyright on the one hand and insufficient incentives to create on the other, compulsory licensing seems a reasonable compromise. Compulsory licensing seems to pay off big in the short term by reducing the need for individual buyers to locate, negotiate with, and pay individual sellers. Compulsory licensing supposedly addresses the "market failure" of high transaction costs.

But markets for digitized works do not suffer from market failures. Furthermore, the Internet has reduced the transaction costs that once served as a key rationale for compulsory licensing. Recent developments suggest that fears of excessive control of digital content are overblown. Without enhancing compulsory licensing, the digital landscape is diverse, as the case of music demonstrates. There is free music, temporarily free music, and low-cost music online. Offline, music companies are lowering the prices of CDs.

The influence costs associated with compulsory licensing schemes make them a more expensive mechanism for setting prices. Private negotiations are much cheaper and more flexible over the long term.

In the digital realm, we have not yet abandoned the basic building blocks of all creative endeavors—property rights, contracts, and voluntary markets—and we therefore retain the preconditions for future growth and diversification.
http://www.cato.org/pubs/pas/pa-508es.html


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Europeans Buy Millions Of Music Downloads
Reuters

Europeans purchased more than three million song downloads in 2003 from the continent's primary online music store, On Demand Distribution, or OD2, raising faint hopes that the lackluster music industry is on the road to recovery.

A few million downloads is not going to immediately turn around an industry bracing for its fourth straight year of declining CD sales. But the emerging download market offers a glimmer of hope for record label executives, who have struggled for years to thwart free file-sharing services like Kazaa.

"I have to believe electronic distribution of music will be an increasingly important part of the business for record labels, but unfortunately, I don't think this is an instant cure," Charles Grimsdale, chief executive of Britain's OD2, told Reuters Tuesday.

"The market is growing fast for sure, but new markets take time," said Grimsdale, who co-founded the company with rocker Peter Gabriel.

Still, the volume of downloads is growing 25 percent month on month, Grimsdale said, which would mean that download sales should grow more than threefold in 2004.

The more mature U.S. market is growing even faster. American music fans purchased 30 million download tracks in 2003, as online stores such as Apple Computer's iTunes proved a big hit with consumers.

The success of iTunes, combined with some encouraging reports that online piracy may be tailing off in the United States, has helped propel shares of the EMI Group, the largest stand-alone music company, more than 40 percent higher since the beginning of the year.

For OD2, which licenses its download service to 30 European retail and Internet partners, including HMV and Microsoft's MSN, the volume of downloads picked up in August, when it introduced through MSN a tariff scheme that enables users to buy downloads without a subscription.

"Our sales increased in some cases as much as 900 percent at that point," Grimsdale said.

Grimsdale acknowledged that competition will be much more fierce in 2004. Industry officials expect the big U.S. online stores such as iTunes and Roxio's Napster to make their European debut by summer.

OD2 is the most established player in Europe, having arranged licensing deals with all five major music labels, giving it a catalog of 260,000 songs.

Grimsdale said it is in the process of adding to its library several hundred thousand songs it has under license, giving it a catalog of a million songs. "We are furiously trying to fill the gap," he said.
http://news.com.com/2100-1027-5143384.html


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Exchange Rates Muddy Music Download Prices
Geoff Gasior

One of the reasons that online music services have become popular is the fact that consumers don't have to purchase an entire CD to get their hands on a one-hit wonder's three and a half minutes of fame. However, the price a music shopper will pay for the latest Outkast, Britney, or White Stripes single very much depends on where that shopper lives. In the US, the major players seem to have settled on a $0.99 price for single-track downloads, though Wal Mart is undercutting everyone and selling songs for only $0.88.

Outside the US, the 0.99 price point has been embraced by music services offered in Canada and the UK. However, due to the wonders of exchange rates, the actual cost of music downloads varies quite a bit from country to country. In Canada, Puretracks is selling songs for $0.99CDN, which works out to about $0.76US. In the UK, mycokemusic will apparently carry songs for £0.99, which works out to a whopping $1.80US.

As new players emerge, the price of downloads may stabilize, but until then there's probably a buck or two to be made muleing music downloads across international borders.
http://techreport.com/onearticle.x/6132


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2003 in Review: DRM Technology
Bill Rosenblatt

It's the end of 2003, and DRM technology is inching ever so slowly towards the mainstream. To use Geoffrey Moore's terminology, DRM has crossed the chasm -- made particularly deep and yawning by the overall post-9/11 technology slump -- and made it firmly into the bowling alley. DRM technology progressed through 2003 primarily by finding new niche markets and building solutions for those markets that expand on established DRM technology architectures with appropriate features. Efforts to launch DRM into the mainstream have started to appear, through a couple of vendor efforts and fledgling standards initiatives, but have yet to gain any significant momentum.

The head bowling pin -- the niche market that developed the strongest in 2003 -- was online music (see our year-end review of online content services), dominated by Microsoft. Other bowling pins that emerged were e-periodicals, led by the vendors NewsStand and Zinio, and downloadable movies, divided for the moment between Microsoft and RealNetworks, the latter being otherwise practically invisible in the DRM market this past year. The e-book market suffered from flat overall growth, but Adobe began to emerge as the prevailing platform in that niche, with MobiPocket appearing poised for momentum in the coming year as more reading-friendly mobile devices appear.

Corporate Enterprise Push

Apart from those media segments, the strongest push into a "niche" market was in the corporate enterprise market. As the concerns of corporate IT executives rapidly shifted from boundless ERP and CRM-fueled expansion plans to information security and accountability, entrepreneurs and existing vendors of DRM-related technologies saw their chance and started to move in.

Some established DRM vendors, such as SealedMedia and RightsMarket, attempted to retool their publishing-oriented offerings for the corporate market and found some success, while others that bypassed the media and publishing market from the start, like Authentica, found their lives extended.

Meanwhile, regulatory compliance concerns in markets such as healthcare and financial services began to take on more importance. The relevant laws (including HIPAA in healthcare and Graham-Leach-Bliley (GLB) in financial services), combined with a post-Enron heightened awareness in keeping corporate information noses clean, created a new type of DRM-friendly environment. Toward the end of 2003, a handful of vendors created remarkably similar elevator pitches for VCs: sell allegedly out-of-the-box information security policy solutions to the new breed of empowered, budget-laden corporate info security czars. Vendors like PSS Systems, Trusted Edge, and Liquid Machines emerged with so-called "document policy compliance" solutions, about which it wouldn't surprise us to learn that they are mostly custom development at this stage.

We expect that there will be at least a half-dozen more vendors attempting to enter this space before the inevitable contraction to 2 to 4 by the end of 2004. We have yet to be convinced, for example, that DRM technology applies to regulatory compliance scenarios like HIPAA and GLB at more than a superficial level, or that there is really any such thing as an out-of-the-box "HIPAA solution." We suspect that such solutions require lots of custom integration and process reengineering, although we invite any of this cavalcade of VC-funded startups to prove us wrong.

The development in the corporate DRM space that threatens to overshadow all of the above is Microsoft's release of Windows Rights Management Services (RMS) for Windows Server 2003. This product is the culmination of the "Unified DRM" strategy that Microsoft has pursued since at least 2001, and it's telling that the product release is targeted at the corporate market rather than integrating Microsoft's DRM offerings for the media/publishing market. As is typical for other types of Microsoft platform technologies, the launch of RMS included an already-populated partner program designed to give third parties opportunities to develop more complex and more niche-specific solutions -- such as for HIPAA and GLB? -- on top of RMS.

New Media Applications

A handful of new DRM application areas emerged in the media market. The most fruitful of these was in pre-release processes -- production and distribution of content. After the major media industry segments began to publicly admit that much of the piracy of major releases takes place before any consumers lay eyes or ears on the products, vendors began to offer solutions for automation of production and distribution workflows that included a DRM component. These solutions, from vendors like DMOD, WiredEntertainment, and Activated Content, pay for themselves immediately through efficiency gained by distributing content over the Internet instead of through physical media; DRM features are almost icing on the cake. Expect the film industry to follow suit next year, especially in light of the MPAA's debacle over the distribution of "screener" copies of movies prior to Oscar time.

A few new media applications for DRM that appeared in 2003 didn't move beyond the "promising" stage. One was watermarking. Watermarking re-emerged from a slump that was brought about by two failures: the failure of the watermarking-based SDMI as a standard for the music industry, and the failure of Digimarc, the heavyweight IP owner in the watermarking space, to develop markets beyond its cash-cow business of licensing the basic tools with which it saturated the graphic arts and imaging markets. A few intriguing glimpses of advanced watermarking applications appeared -- including Sony's Signet Screener technology for video and the Fraunhofer institute of Germany's Light Weight DRM -- but none of these have gotten past the research stage yet.

Meanwhile, fingerprinting, a technology related to watermarking, came into its own this past year. Fingerprinting technology derives identities of content items from the content itself, not from a special mark inserted into it, as watermarking does. Fingerprinting vendors have used the technology to build "name that tune" services for consumers, but the more interesting (and more DRM-related) application of fingerprinting is in broadcast monitoring, i.e., identifying broadcast content for purposes of tracking and rightsholder compensation. Licensing collectives such as ASCAP have begun experimentation with fingerprinting-based broadcast monitoring solutions from vendors such as MediaGuide. Expect this technology to explode into mainstream use, but not for another couple of years as the underlying data issues are slowly and painfully worked out.

Another interesting technology area that emerged in 2003 but did not exit the year with any practical impact was DRM for the home network. Consumer electronics giants like Sony and Matsushita asserted that the home network was the next frontier, and many large content owners seemed to go along with the idea that users could do what they wished with content within their home networks. IBM demoed xCP, lab technology for authentication of device identities on home networks, and Sony began to make some noises about the application of its proprietary Open MagicGate (OMG) DRM technology to home networks, but nothing much has happened.

However, don't look for this area to take off in 2004. Larger problems have to be solved first: consumers can't install the basic plumbing of home networks without arcane technical knowledge, and even if they could, few people understand what a "home media network" is or why they might want one.

A similar lack of progress occurred during the past year in the broadband/set-top box market. That segment of the industry is in a holding pattern waiting for infrastructure as well as for the FCC's broadcast flag regulation (see our year-end review of DRM-related legal actions) to play out in the market.

Do, however, look for DRM to take off in peer-to-peer networks in 2004. The current dichotomy between peer-to-peer networks and established media interests is more a matter of polemics than of technology. Media companies can and eventually will find ways to embrace P-to-P and turn it to their advantage, and DRM technology will need to be incorporated in whatever schemes emerge.

The first experimental glimmers of integrating DRM into P-to-P networks occurred this past year through firms like File-Cash Networks and DigitalContainers, and Grokster made an arrangement with the UK-based DRM vendor SoftWrap. The Content Reference Forum (CRF; see the year-end review of standards initiatives), which originated in the music industry, suggested ways of incorporating DRM into P-to-P networks through formalized, "e-contract" based Superdistribution arrangements. Expect more of this experimentation to occur next year, along with the first glimmers of involvement by media industry product executives, to legitimize the market.

Negative Developments

2003 was a terrible year for copy protection for physical media. DVD piracy abounded, thanks to the selection of the weak CSS copy protection scheme, whose primary advantage seems to be low unit cost for the DVD player makers who designed it. Attempts to foment copy protection schemes for audio CDs were mostly laughable. Schemes that patently (pun intended) did not work, such as SunnComm's for BMG Music, were fobbed off on the public in an apparent attempt either to placate record company executives eager to "just do something," place audio CDs under the protectionist shield of DMCA 1201, or both.

Vendors of proprietary DRM solutions continued to cease operations or sell off their assets, but at a slower pace than in 2001-2, thereby confirming the idea that DRM is moving beyond the chasm phase of its market development. We counted four such developments in 2003: InfraWorks declared bankruptcy, Liquid Audio sold its assets to Wal-Mart's physical media fulfiller, Elisar ceased operations, and at the beginning of the year, Alchemedia sold its assets to a corporate info security vendor.

Finally, the entire DRM industry is holding its collective breath waiting for results from Sony and Philips's $450 Million acquisition of InterTrust in late 2002. The entire year has gone by with hardly a peep. InterTrust continues as a going concern, and there are stirrings of news that Philips will soon be deploying technology that InterTrust is currently developing, but all we are hearing from Sony (and not much, at that) is about its proprietary Open MagicGate technology, which predates the InterTrust acquisition.

Sony and Philips could do something truly radical with InterTrust's massive DRM-related IP and implemented technology -- dare we suggest a broadly applicable DRM toolkit, a la IBM's EMMS, released under open-source licensing? -- or the assets could disappear deeply into the maws of those two gigantic corporations, as those of similar-sized acquisitions have done so many times in the past. The re-emergence of InterTrust could well be the DRM story of the year in 2004.
http://www.drmwatch.com/drmtech/article.php/3294391


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Report Finds Risks in Internet Voting by Americans Overseas
John Schwartz

A $22 million system to allow soldiers and other Americans overseas to vote via the Internet is inherently insecure and should be abandoned, according to a report by computer security experts asked to review the new program.

The system, the Secure Electronic Registration and Voting Experiment, or Serve, was developed with financing from the Defense Department and will first be used in the primaries this year.

The review, requested by the government, noted that experts had voiced increasingly strong warnings about the reliability of electronic voting systems. It said the new program, restricted to voters overseas using personal computers to vote using the Internet, raised the ante on the risks of such systems.

Serve, the panel members wrote, "has numerous other fundamental security problems that leave it vulnerable to a variety of well-known cyberattacks, any one of which could be catastrophic."

Any system for voting over the Internet with common personal computers, the report noted, would run the same risks.

The Trojan horses, viruses and other attacks that complicate modern life and allow crimes like online snooping and identity theft could allow hackers to disrupt or even alter the course of elections, the report concluded. A major American election would be an irresistible target for hackers, and the ability of computers to automate tasks means that many attacks could be carried out on a large scale, the report added.

Such attacks "could have a devastating effect on public confidence in elections," the authors wrote, adding, "The best course to take is not to field the Serve system at all."
http://www.nytimes.com/2004/01/22/te...pagewanted=all


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Napster Takes Executive Action In Europe
Graeme Wearden

Napster, the now-legal music service, has hired its first Europe-based executive as part of a drive to expand into the lucrative European market.

The appointment of Leanne Sharman, a former vice president of sales and marketing at MP3.com, was announced Friday.

Precise details of Sharman's role weren't available, but as Napster's first European executive she will be spearheading the company's expansion into Europe. The European market is being eyed by several big U.S. online music retailers.

"We can't say a great deal at this stage," said a Napster representative. "Leanne's appointment is in response to the tremendous demand for Napster's services that we have seen from Europe."

The representative explained that Napster wants to have a senior player located in Europe to create partnerships with European-based companies. Napster won't name any likely partners at this stage, but says that it's keen to look at a wide range of possible brand tie-ins.

Napster was relaunched as a legal online music service last autumn. Its high-profile battles with the traditional music industry ended with Napster filing for bankruptcy protection in June 2002, and some of its assets were then snapped up by CD-burning software company Roxio.

Despite competition from services such as Apple Computer's iTunes and RealNetworks' Rhapsody, the new Napster is understood to be doing well. It sells individual music tracks for 99 cents, and albums for $9.99, on top of a free service that lets people view music videos and download short audio clips, and a premium service for $9.99 per month.
http://news.com.com/2100-1027-5142250.html


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UPDATED: FBI raids hacker home in search of stolen Half-Life 2 code
"Hungry Programmers" pirate group likely involved
J. Eric Smith

Those wily grunts in the black helicopters are at it again. No, not Microsoft's Secret Service Legion, the somewhat-less-fear-inducing Federal Bureau of Investagation (FBI). According to a weblog posted by a San Francisco resident, the Effa Bee Eye raided his domicile looking for a treasure beyond comprehension: the stolen source code to Valve Software's upcoming blockbuster gaming sequel, Half-Life 2.

The raidee, one Chris Toshok, was rudely awakened by the men in black, who proceeded to search his apartment for anything relating to Valve Software and Half-Life 2. When the federal agents left, they took with them practically every piece of electronic gear owned by Toshok, including 9 computers, his Xbox, and a Tivo.

Toshok proclaims his innocence, but also admits to being associated with a group calling itself the "Hungry Programmers." The group is on the FBI's list as a piracy organization, and has apparently been linked to other hacking activities in the past.

You can read Toshok's blog on the event if you're so inclined.

UPDATE 4:30 P.M. ET: Forgot to include the following attribution in the original posting. Sorry, K.! --ChiefEditor

Thanks to K. Adams for the heads-up, and the link to The Inquirer's coverage.
http://www.geek.com/news/geeknews/20...120023508.htm#


USPTO Grants Calif. Lawyer Patent Over Entire WWW Naming Scheme

Do you know about United States Patent No. 6,671,714? You should. The patent, recently granted to one Frank Weyer of Beverly Hills, California, grants the patent holder full rights to:A method for assigning URL's and e-mail addresses to members of a group comprising the steps of: assigning each member of said group a URL of the form "name.subdomain.domain"; and assigning each member of said group an e-mail address of the form "name@subdomain.domain;"Sound familiar? Well, it should, because the patent describes what is essentially one of the most basic, most crucial underlying structures of the World Wide Web, namely the domain naming system.

The concept of domains and subdomains, as well as the e-mail addresses associated with them, has been around for a long time but apparently has escaped being patented prior to now. Meyer, a lawyer by trade, has capitalized on that oversight, and as of December 30, 2003, Meyer owns it. And now he's using it where it'll do the most good--in court.

On January 17, 2004, Meyer brought suit against Internet heavyweights Network Solutions, Inc. and Register.com, claiming the two services are infringing upon Meyer's newly-granted patent. In the suit Meyer claims damages of an unnamed amount and requests an immediate injunction against the two companies. Meyer states that he hopes to "work with" NSI and Register.com to license his patent. NSI and Register.com don't seem to be cooperating thus far, however.

You can read the text of the patent at the USPTO.
http://www.geek.com/news/geeknews/20...0120023507.htm


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Audio Formats Stumble In Quest to Replace CDs
Mike Musgrove

The appeal to consumers was supposed to be better and more lifelike sound quality. The appeal to music companies was supposed to be a new digital format that consumers couldn't Napster-ize or cheaply copy so it could be sent across the Internet to all their friends.

But instead, two newish audio media formats, DVD-Audio and SACD (short for "super audio compact disc"), seem to be stuck at the starting gate. Rather than replacing the enormously successful CD, these two formats are starting to look like two Next Big Things that may never find a place in tomorrow's all- digital, relentlessly networked living room.

The lack of enthusiasm adds yet another chapter to the hit-or-miss nature of digital innovation, and, experts said, a cautionary lesson in what happens when companies try to impose new restrictions on a product where once there were few or none at all.

Both of these shiny, palm-sized discs look just like standard audio compact discs but contain about six times as much digital information, delivering a sonic picture so detailed their backers brag you could practically hear Mick Jagger strut his stuff across the stage.

Both have been available since 2000 and cost about the same as a CD -- while the machines needed to play each disc cost only about $200, slightly more than traditional CD gear. Yet for both, sales have been negligible.

During the six-month period ending in June 2003, only 100,000 DVD-Audio discs were sold, compared with 245 million CDs, the Recording Industry Association of America reports. Even traditional vinyl records outsold DVD-Audio -- by a factor of six to one.

Rather than growing, sales of DVD-Audio discs are actually down from the same period a year ago. The RIAA does not track SACD sales.

Three years might not seem like a long time for a new format, but by this point in the CD's life cycle, sales had begun to triple and quadruple as consumers lined up to buy into the format.

The CD had a smoother road to introduction. The recording industry and the consumer electronics industry presented a united front when they sold the world on the benefits of the CD 20 years ago, but with the newer formats, there is no unanimity. Each is backed by different industry players (for instance, Warner Music Group likes DVD-Audio, while Sony Music Entertainment Inc. supports SACD). Even many audiophiles with golden ears can't tell the difference between the two.

It's "shades of Beta versus VHS," said Tom Edwards, analyst at NPD Group Inc., a market research firm. "It's a format war all over again, but the differences aren't as obvious this time around . . . and right now it's more a question of whether either of them will win."

"It's fair to say neither format has set the world alight to date," said analyst Jim Bottoms, president of Understanding & Solutions, an English firm that specializes in entertainment media research.

To keep users from easily copying songs featured on DVD-Audio discs and SACDs into MP3 files, both formats use encryption technology, which is supposed to keep the digital information in those song files locked away and unreadable except by authorized DVD-Audio or SACD players.

Since consumers have proved reluctant to buy a format they can't play in their car, SACD backers are offering "hybrid" discs which also feature unprotected (or copy-able) CD layers. A hybrid DVD-Audio is also in the works. Since the CD format was not designed with such security in mind, users can still copy song files off of discs that have this CD layer.

Still, there are no portable, Walkman-style devices to play either format, nor can either type of disc be played in any car except the 2004 Acura TL, which includes a Panasonic DVD-Audio unit.

Some low-cost "home-theater-in-a-box" systems from Sony or Philips include SACD compatibility. And music buyers may have to look through the liner notes to discover they've bought an SACD. Sometimes it is more difficult.

When Sony re-released the Rolling Stones catalog as hybrid SACDs, it left out the word "SACD" on the packaging material -- folks at the label feared the albums would be relegated to some "high definition" bin in the far corner of record stores. The reissues sold about 2 million copies.

David Kawakami, director of Sony's SACD efforts, said that hybrid discs have allowed the company to "get around the whole chicken-and-egg conundrum" that is common to new technological formats.

Though he admits that many owners of the hybrids don't have SACD players yet, he thinks they're still good marketing. "If you're a die-hard fan you're probably going to want to check out the SACD player at some time," he said.

David Dorn, vice president of strategic marketing at DVD-Audio backer Warner Music Group, pointed out recent DVD-Audio releases by R.E.M. and Outkast as a sign that big-name recording stars are beginning to take to the format.

"If we're able to get more artists to work in the format, I think it's really going to work," Dorn said. "It is always the artists who drive the adoption of a format."

While record companies have been choosing sides over which type of disc to support, consumer habits have been drifting away from discs entirely.

Apple's online music store iTunes, just one of a number of new online shops that sells copies of individual tracks for consumers to download to their computers, recently sold its 30 millionth song since it opened up this spring.

The research firm Ipsos-Insight estimates that roughly 10 million Americans paid to download music or MP3 files off the Internet in the first half of the year.

Sony's Kawakami has seen this behavior firsthand. "My 17-year-old daughter lives on her Mac, it's her portal to the world -- she does everything on it, including listening to music. For the time being, she's tied to her Mac and her iPod."

Kawakami hopes she'll be won over by SACD when she gets older.

"I have a feeling that, when she grows up, she's going to desire quality, and she's going to end up buying the albums of several bands she was introduced to on the Internet," he said.
http://www.washingtonpost.com/wp-dyn...2004Jan19.html

[JackSpratts]

Environmentalists Condemn Disposable DVDs
AP

Promoters of a new disposable-DVD technology tout the product's convenience, but environmentalists condemn the self-destructing movie discs as a step backward in developing reusable products.

Buena Vista Home Entertainment, a branch of The Walt Disney Co., introduced the "EZ-D" in September and now offers 35 movies in the format.

Consumers have 48 hours after opening the box to watch movies on the $7 (U.S.) discs before an oxidation process changes their colour, rendering them unusable.

The disks were tested in four markets around the country, including Austin, where they are available at stores such as 7-Eleven, Walgreens and HEB supermarkets.

Local environmentalists protested outside one 7-Eleven in October and urged shoppers to send postcards to Disney, condemning the disposable DVDs.

They claimed some success — Robin Schneider, executive director of the Texas Campaign for the Environment, said HEB instituted recycling facilities for the EZ-Ds in response to the outcry.

"The whole way the product is being marketed as 'no returns' is environmentally irresponsible," Mr. Schneider said. "I've worked on many different issues, and I think this has been the easiest one to mobilize the public because they see the advertisements on television and see how wasteful the products are."

Buena Vista officials said consumers will have a different reaction to the discs.

"We believe consumers will enjoy the convenience of a rental alternative that requires no extra trips to return product and no late fees," Bob Chapek, president of Buena Vista, said in a statement.

Representatives of Flexplay Technologies, the New York-based developers of the EZ-D technology, declined interviews.

Buena Vista promotes the recycling of EZ-Ds on its Web site, including instructions for mailing the EZ-Ds to collection points free of charge. The recycling program is being handled by GreenDisk, a Seattle-based company that disposes of electronic waste.

GreenDisk's address is included on the EZ-Ds, and people are encouraged to mail the discs using downloadable mailing labels that cover postage, said David Beschen, GreenDisk's chief executive officer.

GreenDisk grinds up the EZ-Ds and ships the polycarbonate plastic remains to a recycling company for use in plastic products such as auto parts or appliances, Mr. Beschen said. He praised Buena Vista's effort to recycle the discs.

"What we saw was a group of people who worked aggressively before they even put a product on the street to make sure they had a way to get it back off," Mr. Beschen said. "That's about all you can ask for in a free-market system."

Mr. Beschen said he didn't have numbers on how many discs have been recycled, but he said mail-in and bin collection started slowly and appeared to have picked up since Christmas.

At the city of Austin's recycling centre, home to one of two local designated EZ-D recycling bins, only about 10 discs have been turned in, said city spokeswoman Stephanie Lott.

Some retailers said Austin residents have been slow to latch onto the technology.

At a 7-Eleven this week, 11 EZ-D titles were on display next to magazine racks on the store's front counter. Shift manager Rafy Hernandez said that shoppers have asked about the EZ-Ds and expressed concerns about their waste.

"I haven't really sold any," he said. "I would like to sell some so I could get some feedback from people."

Jessica Felter, of Austin, stopped at the store for a cup of coffee but said she has little incentive to buy an EZ-D. She said she generally returns rented movies on time, making a $7 disposable movie unnecessary.

"For my husband and I, we would watch it once and that would be it," she said.
http://www.globetechnology.com/servl...ry/Technology/


~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Not A WASTE Of Time
Christopher Saunders

Much of what has been written about WASTE, the controversial peer-to-peer (P2P) application released without permission by an America Online programmer, has centered around its notorious origins. But largely overshadowed by the brouhaha is a significant work of collaborative technology that enables secure, basic communication -- and from which makers of more corporate-ready applications might learn.

The WASTE flap began in May, when programmer Justin Frankel published a working version of the application, and the software's source code, and attempted to release both under the GNU General Public License, in an effort to hand WASTE and its code to the open-source community.

But Frankel happens to be the head of Nullsoft, a subsidiary of Time Warner's America Online unit, and shortly after WASTE's posting to Nullsoft's Web site, the software was removed. (Whether the software today is legally in the public domain remains in doubt; the download page was replaced with a stern notice warning from Nullsoft that "Any license that you may believe you acquired with the Software is void, revoked and terminated.")

That wasn't the end of WASTE, however. Despite being available online only for a few hours, the application and its code had already made its way into the wild; in September, an updated version of the program appeared on open-source application repository SourceForge.net.

Now, the tiny program (about 300k in file size) continues receiving updates from the open-source community, and its latest iterations -- WASTE version 1.4 Alpha 1 for Windows debuted earlier this week -- reveal steadily evolutions in highly secure collaboration technology.

At present, WASTE provides one-to-one instant messaging, group chat, and file sharing -- uploading, downloading, and browsing a shared directory.

This isn't a system for large, distributed P2P networks like Gnutella (which, incidentally, Frankel also originated.) Instead, WASTE is more oriented toward smaller groups of mutually trusted users. (The original documentation indicates that WASTE has a maximum effectiveness of about 50 participants.)

Architecturally, WASTE creates a web of distinct nodes linked by peer-to-peer connections; it's not centralized, like the traditional instant messaging networks operated by America Online, Microsoft, and Yahoo!.

As a result, network traffic flows throughout the entire web of nodes -- even circumventing firewalls -- and the loss of one user won't bring down the entire network. The application also can support a form of authenticated auto-discovery of new users -- enabling recent additions to the network to appear in others' contact lists, automatically.

Trust comes into play because a user wishing to gain entry into the network must exchange public keys with a current participant. Depending on users' trust settings, a user that joins the network by linking to an already-collaborating peer is generally available for collaboration with all others, although participants can set their program to require manually authorization of new peers.

In other words, WASTE's lowest level of trust protections mean that someone in a WASTE workgroup must authorize the entry of an outsider. At its highest setting, individual users must decide whether to become visible to each new addition.

WASTE also provides for high-level information security. The system relies on 1,536-bit RSA public keys for session key exchange and authentication. Links between users are encrypted using Blowfish in Propagating Cipher Block Chaining mode. Consequently, text chat and file sharing is secure and encrypted.

The application also provides for clear-text logging of IM conversations.

Granted, WASTE requires more time to mature. For one thing, adding nodes manually is a bit user-unfriendly, to put it mildly. There's also the fact that its closed-network framework could pave the way for so-called "darknets" of illicit file-trading activity (albeit, on a far smaller scale than networks like Gnutella and KaZaA). And, as part of its intrinsic design, there's no provision for central oversight by an IT administrator.

Yet its strengths also highlight the benefits of a P2P-based architecture for IM and collaboration. In addition to strong encryption and authentication features, the system obviates the need for a centralized server while protecting against information interception.

Considering the possibility that the open-source community could layer additional applications onto WASTE's framework, we could be seeing much more out of the controversial little application in the near future.
http://www.instantmessagingplanet.co...le.php/3300391


~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Indie Music And Beyond

CBC Radio 3 has been hailed as a model for the future of broadcasting. But many Canadians have never even heard of the award-winning virtual network, ALEXANDRA GILL reports
Alexandra Gill

VANCOUVER — Is the CBC boring? A recent report says yes, resoundingly so.

''Loosen up,'' urges a summary account of the public broadcaster's six-month, 1,000-page study, which suggests the network's image could be ''enhanced by having a more youthful and lively style.''

The findings are hardly new. Back in 1957, Canadian media guru Marshall McLuhan made a case for Why The CBC Must Be Dull in Saturday Night magazine. A grainy black-and-white photocopy of that article hangs on the wall behind Rob McLaughlin's desk.

"It reminds me that the struggle is a long one," laughs McLaughlin, executive producer of Vancouver-based CBC Radio 3.

Long, perhaps, but not impossible. McLaughlin's experimental new-media unit is doing everything in its offbeat, high-tech power to reach new audiences while injecting some excitement into Canadian public broadcasting. And despite the odds, they're succeeding spectacularly.

In just four years, CBC Radio 3 has chalked up more than 30 awards, including several Webbys, the holy grail of new media, and a Prix Italia, the oldest and most prestigious radio competition in the world. When CBC Radio 3 won that prize for arts and culture in 2001, it was the first for CBC in nearly 40 years.

So what is CBC Radio 3? It's not exactly radio, although the unit does produce three late-night programs on the network's regular FM frequency, CBC Radio Two. And it's not exactly a website, although they do have five.

If you go to the flagship site at http://www.cbcradio3.com, preferably with a broadband connection, you'll find stories on a diversity of subjects, ranging from the Dene Winter Games finger-pulling contest to the Romanow commission, photo essays, poetry, videos, interviews with bands and a smorgasbord of weird and wonderful art commissions.

Take Sites Unseen, for example. "Seven Days, Six Disposable Cameras and Two Blind Photographers," reads the tag line. And you really must see the lopsided shot of the urinal with your own eyes to understand what photographer Ryan Knighton means when he says it's not easy to feel his way around public washrooms.

The elements, which flash, pop and slide through the virtual matrix with greater ease than daring young men on a flying trapeze, are all accompanied by audio and a steady stream of independent Canadian music, selected from a huge bank of songs submitted by musicians from across the country.

Every week, the site features a new 20-song playlist, downloaded from one of Radio 3's other sites, http://www.newmusiccanada.com.

For folk, country and world music, tune in to http://www.rootsmusiccanada.com. Or for recordings of live concerts across Canada, go to http://www.justconcerts.com. The White Stripes in Vancouver anyone?

CBC Radio 3 also produces the veteran indie-music program Brave New Waves (weeknights on CBC Radio Two from midnight to 4 a.m.), plus the new CBC Radio 3 program (Saturday, 7:30 p.m. to 4 a.m., and Sunday, midnight to 4 a.m.).

The virtual network has been hailed as the vanguard of independent Canadian music. Some say it's a model for the future of broadcasting. But most visitors simply can't believe it's a part of the CBC.

"HOLY CRAP!" one listener calling himself G.K. exclaimed in an audience feedback form.

"This site is incredible," wrote another, named Dave. "I had no idea the CBC was producing material like this. It's so nice to see CBC getting back to ree-ali-tee."
http://www.globetechnology.com/servl...ry/Technology/


~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Viruses Turn To Peer-To-Peer Nets
BBC

Virus writers are setting up peer-to-peer networks to help their malicious creations spread. The networks are being used to control thousands of innocent PCs that some virus programs have infected. The tactic is being used because peer-to-peer networks are hard to disrupt, making viruses using this technique hard to stop spreading. Security experts say peer-to-peer networks are likely to become more and more popular with virus writers.

Kevin Hogan, head of Symantec Security Response, said the good news about peer-to-peer virus networks was that they were rare. He said many peer-to-peer networks were often not very efficient at passing commands between member machines. Also many swap data via rarely used ports that most firewalls routinely block.
http://news.bbc.co.uk/2/hi/technology/3409187.stm


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Easing of Internet Regulations Challenges Surveillance Efforts
Stephen Labaton

The Federal Communications Commission's efforts to reduce regulations over some Internet services have come under intense criticism from officials at law enforcement agencies who say that their ability to monitor terrorists and other criminal suspects electronically is threatened.

In a series of unpublicized meetings and heated correspondence in recent weeks, officials from the Justice Department, the Federal Bureau of Investigation and the Drug Enforcement Administration have repeatedly complained about the commission's decision in 2002 to classify high-speed Internet cable services under a looser regulatory regime than the phone system.

The Justice Department recently tried to block the commission from appealing a decision by a federal appeals court two months ago that struck down major parts of its 2002 deregulatory order. Justice Department officials fear that the deregulatory order impedes its ability to enforce wiretapping orders.

The department ultimately decided to permit the F.C.C. to appeal, but took the highly unusual step of withdrawing from the lawsuit, officials involved in the case said.

As a result of the commission's actions, said John G. Malcolm, a deputy assistant attorney general who has played a lead role for the Justice Department, some telecommunications carriers have taken the position in court proceedings that they do not need to make their networks available to federal agents for court-approved wiretapping.

"I am aware of instances in which law enforcement authorities have not been able to execute intercept orders because of this uncertainty," Mr. Malcolm said in an interview last Friday. He declined to provide further details.

The clash between the commission and officials from the Justice Department and other law enforcement agencies pits two cherished policies of the Bush administration against each other. On one side stand those who support deregulation of major industries and the nurturing of emerging technologies; on the other are those who favor more aggressive law enforcement after the Sept. 11 terrorist attacks.

The outcome of the debate has far- reaching consequences.

Law enforcement officials say it will determine whether they can effectively monitor communications between suspects over new kinds of phone services that otherwise might allow them to escape detection. Also at stake is whether the government or industry will bear the considerable costs of developing the technology for such surveillance.

By contrast, some F.C.C. officials and telephone industry executives say that if the commission buckles to the other agencies and forces the industry to take on a host of expensive obligations the development of promising new communications services may be stalled or squelched for years to come.

"What's most scary for industry and perhaps some people at the F.C.C. is the notion that the architecture of the Internet will depend on the permission of the F.B.I.," said Stewart A. Baker, a former general counsel of the National Security Agency, which monitors foreign communications. Mr. Baker now represents a number of telecommunications companies as a partner at the law firm of Steptoe & Johnson.

Classifying Internet-based phone services as "telecommunications" would allow law enforcement officials to require companies to provide them with access to contemporaneous conversations on their networks under the 1994 wiretapping law.

But such a classification also imposes on the companies a host of onerous requirements under the 1996 act, including those intended to assure that telephones are universally available and that everyone has access to 911 emergency services. These obligations, purveyors of the new Internet telephone services say, are so expensive that they will deter their development.

Government and industry lawyers say that the commission could try to define the new services as "telecommunications" under the 1994 surveillance law and "information" under the 1996 act. But taking that potentially conflicting approach could undermine the F.C.C. in court in the inevitable legal challenges that would follow its rulings.

Mr. Powell, in a series of recent speeches and interviews, has suggested that the new technologies need to be classified as "information services" and thus be subjected to fewer regulations.

"Don't shove the round Internet into a square regulatory hole," Mr. Powell said at a luncheon appearance last week before the National Press Club. "We cannot contort the character of the Internet to suit our familiar notions of regulation. Do not dumb down the genius of the Net to match the limited visions of the regulator.

"To regulate the Internet in the image of a familiar phone service is to destroy its inherent character and potential," Mr. Powell said. Such new technologies empower people, "giving them more choice and control."

"And I think as consumers do more, governments do less, because we don't regulate our citizens."

In the same speech, Mr. Powell added, "We will need to ensure the legitimate concerns of public safety and law enforcement are addressed."
http://www.nytimes.com/2004/01/22/te...l?pagewanted=2


~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Microsoft Lightens Up On Teen's mikerowesoft Site
Reuters

Microsoft Corp. indicated on Tuesday it might have overreacted to the Web site of Canadian teenager Mike Rowe who had added the word "soft" to his name and registered the address mikerowesoft.com.

"We take our trademark seriously, but in this case maybe a little too seriously," Microsoft spokesman Jim Desler said.

"We appreciate that Mike Rowe is a young entrepreneur who came up with a creative domain name, so we're currently in the process of resolving this matter in a way that will be fair to him and satisfy our obligations under trademark law," Desler said.

In November, Microsoft's Canadian lawyers demanded that Rowe, 17, change the name of his Internet site, claiming copyright infringement. They said they would pay Rowe, who lives in Victoria, British Columbia, $10 for his trouble.

But the high school student decided to fight back and his story got media attention to the extent that he was forced to shut down his Web site on Monday morning after getting about 250,000 hits. He managed to get the site back up after moving to a service provider with greater capacity.

"I never expected this type of feedback. I have put up a defense fund so that I can hire a lawyer to guide me through the process of talking to Microsoft.... I could never think this could happen, even in my wildest dreams," Rowe wrote on his site.

Rowe is demanding $10,000 from Microsoft to change the site's name.
http://biz.yahoo.com/rc/040120/odd_c...crosoft_1.html


~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Funny File

“RIAA Phone Call”


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ISPs Ignore RIAA's New P2P Ploy
Roy Mark

After an appeals court ruled that Internet service providers (ISPs) do not have to hand over names of suspected music pirates to the Recording Industry Association of America (RIAA), ISPs are showing no interest in the RIAA's latest effort to enlist them in its fight against music piracy.

The RIAA now wants ISPs to notify its customers that are suspected of illegal downloading but not yet targeted for a lawsuit by the music industry.

"We would like to work with you to supplement our efforts by arranging for ISPs to notify their subscribers who are engaged in infringing activity that this conduct is illegal," the RIAA wrote to most of the nation's 50 largest ISPs in a Dec. 16 letter. "We are asking you to do this without providing us any identifying information about the subscriber."

Under the proposal, the RIAA would supply an identifying IP address of a suspected infringer to its ISP, which would then send a notice of infringement to the subscriber.

According to industry officials contacted by internetnews.com, not one ISP has agreed to cooperate with the music industry, which was dealt a major legal setback on Dec. 19 when an appeals court ruled the RIAA could not force ISPs to turn over the identities of alleged music pirates. The RIAA claimed it had subpoena power under the Digital Millennium Copyright Act (DMCA).

The decision reversed a January 2003 lower court decision upholding the DMCA subpoena power. Armed with that decision, the RIAA issued more than 3,000 subpoena requests to ISPs and filed nearly 400 copyright infringement actions in a highly publicized and controversial attack against individual downloaders. No subpoenas have been issued since the Dec. 19 decision.

The Dec. 16 letter, signed by RIAA CEO and Chairman Mitch Bainwol and president Cary Sherman, shows that the group wants to go a step further in order to stop illegal downloads of copyrighted material.

"Specifically, when we determine the IP address of an infringer, we would like to send you the IP address along with a Notice of Infringement that you would forward directly to the subscriber matching that address," the RIAA wrote. "You would not identify the subscriber to us. However, we believe if you forward the Notice to them it will dramatically increase awareness and effectively discourage continued infringement."

A music industry official, who asked not to be identified, said the proposed ISP infringement notice is intended to send an early warning to downloaders. Since a large of percentage of music downloading is done by teenagers, the RIAA hoped the notifications, which were to be sent to the account holders, might tip off parents as to their children's possible copyright infringements.

"Our hope is that the voluntary Notice program we are proposing will allow us to work cooperatively to educate the public and to reduce online copyright infringement," the letter states. "Not only will your participation help ensure that a vibrant and legitimate market for online music can succeed, but forwarding a Notice to your subscribers may also save them from becoming defendants in future copyright infringement lawsuits."

The RIAA declined to elaborate on the letter. "We feel the language of the letter speaks for itself," RIAA spokeswoman Amanda Collins said.

ISPs are cautious in their public responses, although all agreed they are under no legal obligation to comply with the RIAA request. The RIAA aknowledged that there is no law requiring the ISPs to send the notification letters.

"We are more than happy to talk with them (RIAA), but it has to as a part of a broader issue," said Verizon (Quote, Chart) vice president and general counsel Sarah Deutsch.

She noted that the RIAA has not said whether it will appeal the Dec. 19 decision to the Supreme Court and that the music trade group is still litigating the authority of the DMCA subpoena in other jurisdictions.

Earthlink (Quote, Chart) spokesperson David Blumenthal said his company would "evaluate the request, talk with the RIAA and decide what we think is best."

Nicholas Graham, a spokesman for AOL, said the company does not discuss "day-to-day letters from the RIAA."

MSN, the online network operated by Microsoft, did not respond to calls from internetnews.com.
http://www.internetnews.com/xSP/article.php/3300211


~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

RIAA Slams Uploaders With Hundreds of New Suits
Ted Bridis

The recording industry on Wednesday sued 532 computer users it said were illegally distributing songs over the Internet, the first lawsuits since a federal appeals court blocked the use of special copyright subpoenas to identify those being targeted.

The action represents the largest number of lawsuits filed at one time since the trade group for the largest music labels, the Recording Industry Association of America, launched its legal campaign last summer to cripple Internet music piracy.

Music lawyers filed the newest cases against "John Doe" defendants - identified only by their numeric Internet protocol addresses - and expected to work through the courts to learn their names and where they live. All the defendants were customers of one of four Internet providers.

The 532 new defendants represent a tiny fraction of the estimated tens of millions of U.S. computer users who regularly download music illegally across the Internet, but the recording association described each one as a "major offender," distributing an average of more than 800 songs online. Each defendant faces potential civil penalties or settlements that could cost them thousands of dollars.

The resumed legal campaign was intended to discourage music fans emboldened by last month's federal appeals court decision, which dramatically increased the cost and effort to track computer users swapping songs online and sue them.

"Our campaign against illegal file sharers is not missing a beat," said Cary Sherman, president of the recording association. "The message to illegal file sharers should be as clear as ever."

All 532 lawsuits were filed in Washington and New York - home to Verizon Internet Services Inc., Time Warner Inc. and a few other prominent Internet providers - although the recording association said it expects to discover through traditional subpoenas that these defendants live across the United States.

"These are soccer moms, immigrant families, just ordinary citizens trying to reap the benefits of what appears to them to be nifty technology," said Jay Flemma, a New York lawyer who represented eight people sued in previous rounds by the music industry. "They're scared and they're frustrated and they really don't understand the nuances of copyright law."

The RIAA said that after its lawyers discover the identity of each defendant, they will contact each person to negotiate a financial settlement before amending the lawsuit to formally name the defendant and, if necessary, transfer the case to the proper courthouse. Settlements in previous cases have averaged $3,000 each.

Verizon had successfully challenged the industry's use of copyright subpoenas, one of its most effective tools to track illegal downloaders. The U.S. Court of Appeals for the District of Columbia ruled last month that the recording industry can't use the subpoenas to force Internet providers to identify music downloaders without filing a lawsuit.

The court said the copyright subpoena process available under the 1998 Digital Millennium Copyright Act "betrays no awareness whatsoever that Internet users might be able directly to exchange files containing copyrighted works."

The appeals decision and Wednesday's new lawsuits threw into legal limbo hundreds of computer users previously identified as illegal downloaders.

The RIAA said that, for now, it will not file new lawsuits or demand new financial settlements against computer users whose names were previously turned over under the disputed copyright subpoenas. But it did not rule out filing "John Doe" lawsuits against those same computer users - even though it already knows their identities.

"We will not be making any use of the names previously disclosed to us," Sherman said.
http://view.atdmt.com/FUL/iview/ntni....300/01?click=


~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Recording Industry Is Accusing 532 People of Music Piracy
John Schwartz

The music industry returned to the courthouse today with lawsuits against 532 people it is accusing of large-scale copyright infringement.

``Our campaign against illegal file sharers is not missing a beat,'' said Cary Sherman, president of the Recording Industry Association of America. ``The message to illegal file sharers should be as clear as ever.''

The lawsuits, with the largest group of defendants to date, is the third round filed against suspected file sharers since the industry began its campaign of lawsuits last summer. But these are the first lawsuits since a federal court of appeals declared that the industry's tactic of using special copyright subpoenas to unmask anonymous music traders was illegal.

The new lawsuits are ``John Doe'' lawsuits, an increasingly common type of litigation in the Internet age, which allow plaintiffs to sue people whose identities are not known. These suits identify the suspected file traders only by the numerical identifier, known as an Internet Protocol number, assigned to them by their Internet service provider.

In the previous lawsuits, the industry used a streamlined process under copyright law to determine the identities of copyright infringers by filing a simple form with a court clerk, instead of a using a more conventional subpoena that must be reviewed by a judge. But in December, the United States Court of Appeals for the District of Columbia declared that the provision of copyright law did not apply to file sharing over peer-to-peer computer networks.

Industry officials said when that decision was handed down that they would change their tactics to conform to the law, but that they would not change their overall strategy of suing to enforce copyright.

Jonathan Zittrain, co-director of the Berkman Center for Internet and Society at Harvard Law School, said the new round of lawsuits showed ``the record industry making good on its promise not to let up.''

Although the hundreds of defendants might live anywhere in the United States, the industry actually only filed four lawsuits today, three in New York courts and one in Washington, because those courts are close to major Internet service providers.

The industry are asking the courts to issue subpoenas to the Internet service providers to disclose their subscribers' names based on the Internet Protocol numbers. Once the subscriber's name is known, the original complaint will be amended to include the subscriber's name, or in some circumstances the cases will be re-filed or moved to other courts.

The industry lawyers said they would offer a defendants a chance to settle the lawsuit before amending the suit under the defendant's name.

Sarah Deutsch, vice president and associate general counsel for Verizon Communications, said her company would comply with the subpoenas. Verizon brought the suit against the Recording Industry Association of America to protect the identities of its Internet customers, and it insisted at the time that the industry should file John Doe suits instead of using the copyright subpoena shortcut.

The new wave of suits, however, might raise other issues, Ms. Deutsch said. ``Although in theory the John Doe lawsuit is more protective of consumers' interests, in this case a lot depends on whether the R.I.A.A. will push the envelope of what's permitted'' under the process, she said. ``If that doesn't seem kosher to a judge, they may well have a problem.''

The process of consolidating so many suits into actions for single courts and the grand scale of the suits have caused some legal experts to wonder if the courts are ready to deal with the challenge.

``The court system will have to decide how big an administrative burden it is willing to suffer to allow the industry to get these names and go after people,'' Mr. Zittrain of the Berkman Center at Harvard said.

Cindy Cohn, legal director of the Electronic Frontier Foundation, which has fought the industry's attempts to unmask suspected file traders through streamlined subpoenas, said, ``This is a better process, in the wrong direction.''

While the use of John Doe suits protects individual privacy and due process to a greater extent than the copyright subpoena system, she said, the recording industry is nonetheless pursuing a doomed strategy in trying to punish potential customers. Her group favors establishing a system of set fees in exchange for broad access to music like those used in the broadcast realm.

``They should be offering consumers the right to share files in exchange for fair payment like they offer radio stations,'' Ms. Cohn said.

Although the lawsuits have generated a harsh response and bad publicity, recording industry officials said that by other measures the industry's tough approach was proving successful. By some measures, file trading on peer-to-peer networks has dropped, at least in the United States, while awareness that trading music violates the law ``has shot through the roof,'' said Mitch Bainwol, chief executive of the Recording Industry Association.

At the same time, fledgling legitimate services like Apple Computer's iTunes Music Store and Rhapsody from RealNetworks have grown, and music sales overall rose in the months after the industry filed its suits. According to Nielsen Soundscan, sales of compact discs last year declined 2 percent from the year before, a smaller drop than had been anticipated before the first round of lawsuits were filed in September.

``The debate isn't digital versus plastic,'' Mr. Bainwol said. ``It isn't old versus new. Here's what it is: Legitimate versus illegitimate.''

Mr. Sherman of the recording association said that regardless of whether file trading activity could be quashed, the industry would measure its progress ``by the success of legitimate services - and by that measure, we are delighted.''
http://www.nytimes.com/2004/01/21/bu...rtner =GOOGLE


~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

“RIAA goes after 532 unnamed file sharers.”

Dynamic IP’s? Cycle’em if you got’em baby. – Jack.


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The World's Most Dangerous Geek

Justin Frankel, the man who popularized file-sharing, has even bigger plans
David Kushner

The most dangerous man in music is ready to rock. It's Saturday night in San Francisco as Justin Frankel, gangly and bed-headed, ambles through the warehouse garage he aptly calls his "playground." He has come here, as he often does, to screw around on his drums or his Moog or electric guitar. But first he needs his fog machine.

"It's around here somewhere," he says, checking under his makeshift concert stage, a riser set against a wall postered with naked women. Then he looks under his Porsche, his VW van, his Swiss military truck, his Go Big scooter, his gutted Audi. He pokes his head behind a hacked Xbox, pulsing the word SeXbox onto a forty-eight-inch flat screen. No luck. "I don't know if I have any CO2 cartridges for it anyway," he says, bumming. Not to worry, there's always his light-show laser. A twenty-five-year-old with $100 million deserves his toys.

If you've downloaded a song in the past few years, it's in large part because of Justin Frankel. Seven years ago, when he was just eighteen, he invented Winamp, the first software program that made it easy to play digital music on your computer. A few years later, he created Gnutella: the vast, and vastly controversial, online network that lets you swap songs. The fact that Frankel secretly did the latter while working at America Online, the company behind his multimillion-dollar buyout, made him both the Internet's greatest punk -- and hero. Now he's about to punk the industry again.

That's because, after years of being muzzled by AOL for igniting the pirate nation, Frankel is breaking his silence. "This is an environment where I don't get to do what I want to do," he says. What he wants to do is even more radical than Gnutella. And to do this, he needs to break free. "Eighty percent of the people at AOL are clueless," he says. When I ask him if they have anything to fear by him leaving, he replies, half-jokingly, "If anything, they have more to fear when I'm working for them."

Frankel kills the lights and gets behind the drums. Despite my rusty chops, he encourages me to strap on an electric guitar. "Things I've done are often interpreted as anti-record-industry," he says, "but it's really about empowering people."

Back in 1996, when a seventeen-year-old Frankel downloaded his first song -- "Pepper," by the Butthole Surfers -- no one really cared about such things. Napster didn't exist. The Recording Industry Association of America hadn't sued a twelve-year-old girl in the projects for downloading, among other things, the theme song to the TV show Full House, and America Online hadn't started hemorrhaging 2 million subscribers a year.

The son of a lawyer and a postal worker, Frankel grew up in a mobile home in the hippie nexus of Sedona, Arizona, where he spent his afternoons taking apart old radios or constructing elaborate model airplanes. "Once Justin gets an idea for something," his father, Charles, says, "he finds a way to create it."

Unchallenged by classes, Frankel took control of his own education, largely directing his own home schooling. Around then, he also started messing with his brother's Atari 8-bit computer. By the time he started high school, he was a self-taught whiz. He ran the school's computer network and racked up a better than 4.0 GPA. In addition to writing an e-mail program for the school, Frankel coded software he called Happy Bug, which would log the keystrokes of teachers at their machines. "It would show you everything they typed," he recalls. But he didn't create the program to steal tests or eavesdrop, he says. "It was more like, 'Cool, look what I can do.'"

After graduating from high school in 1996, he enrolled at the University of Utah, but he clashed with his more traditional computer-science professors and dropped out after two semesters. A few months later, he uploaded Winamp (the name is short for Windows Amplifier). With its equalizer, playlist features and trippy visuals, Winamp trumped every MP3 player out there. In a year and a half, 15 million people downloaded the program. A sizable portion even sent in the voluntary ten-dollar shareware fee that Frankel had requested, reluctantly, on his parents' advice. With tens of thousands of dollars coming in every month, his dad all but abandoned his law practice to help field calls from companies that wanted to cash in on the outfit Justin nihilistically called Nullsoft, a play on Microsoft.

But Justin, despite buying himself a used turbo Audi, was in no rush to sell out. Early on, he had included the tag line "Winamp whips the llama's ass" (riffed from a line in a song by the late schizophrenic Chicago street singer Wesley Willis) on every player. When a pharmaceutical company offered big money to adapt Winamp for use in sales presentations -- on the condition that he remove the tag line -- Frankel balked, and the deal fell apart.

Soon, Frankel coded another program, Shoutcast, do-it-yourself broadcasting software that let people "stream" their own audio over the Net. By 1999, Winamp and Shoutcast put digital music -- and its young creator -- on the map. And America Online wanted in, to the tune of $100 million. Frankel responded with two words: "Holy crap!"

In addition to acquiring Nullsoft in the summer of 1999, the company paid $300 million for Spinner, the leading online-radio service at the time. These were the boom years, and the message was loud and clear: The future of music was on the "information superhighway," and Justin Frankel, hired to further develop Winamp as the standard MP3 player, was going to drive it. And AOL was going to own it. In a statement, AOL's chief operating officer, Bob Pittman, the guy who had previously created MTV, trumpeted, "Combining these leading Internet music brands with the audience reach of our brands will lift music online to the next level of popularity." He had no idea.

"All right, Radiohead!" says frankel, shuffling to a row of CDs inside Amoeba Music, a sprawlingly hip record store in Haight-Ashbury. He's wearing jeans, a white T-shirt and a black leather jacket. He has the patchy Chia-like beard of a dude who doesn't give a shit about patchy Chia-like beards.

"When Hail to the Thief leaked on the Internet," Frankel says, "I was like, 'Right on!' But I still bought the CD. I think it's wrong to download music and never give anything to the artist. But if you download something and you're like, 'This sucks,' and you never listen to it again, I don't think there's anything wrong with that." A true child of Sedona, Frankel maintains a heartfelt sense of morality and karma. It's this passion to do right by music fans that inspired him to create the very thing that so many people consider to be wrong: Gnutella.

Gnutella's birth came at the end of what Frankel now calls his "very short honeymoon" with America Online. At first, it seemed like the ultimate setup: good money, a nice office and the freedom to work on the next version of Winamp. But it didn't take long for things to sour. Almost immediately after the deal was struck, persnickety hackers online cried "sellout." Frankel's girlfriend broke up with him because, he says, "she got freaked out by the money." And the big, open office Nullsoft and Spinner shared in San Francisco got Dilbertized by AOL. "Three months after we arrived," Frankel says, "they built all these cubicles, and it sucked."

It was inside his cubicle one day that Frankel first saw Napster. File-trading wasn't new. But Shawn Fanning, Napster's nineteen-year-old creator, had coded a clever piece of software that made this geekish pastime user-friendly. "When I first saw Napster, I thought, 'Wow, that's pretty cool,' " Frankel says, " 'but how will they keep from getting sued?'"

Napster had a fatal flaw. Fanning was using a bank of his company's own computers to facilitate all those Metallica songs flying back and forth online, and Fanning was setting himself up to profit from copyright infringement. "Napster was a company built on people doing things that are illegal," Frankel says. "That's wrong." Rob Lord, who had joined Nullsoft's team, even tipped off the RIAA to Napster.

Frankel decided to "take the wind out of Napster's sails." His solution: an online network that could let people trade all kinds of files -- songs, videos, whatever -- in a decentralized environment. By connecting people's computers directly with one another, they could trade data without having to go through some company's rack of servers. Best of all, Frankel thought, such technology would be good karma, too. "I would not be getting any money from it," he says. "I'd be giving power to people, and what can be wrong with that?"

Frankel got to work on what became Gnutella, named after the chocolate-hazelnut spread and, more tellingly, the "GNU" free-software project. He coded fast and on the sly. "I didn't want AOL to find out," he says, "because they'd prevent it from happening."

On March 14th, 2000, Frankel and Tom Pepper, a Nullsoft cohort, uploaded an early version of Gnutella, with a note: "Justin and Tom work for Nullsoft, makers of Winamp and Shoutcast. See? AOL can bring you good things!" The next day, Frankel was with his parents touring Alcatraz, appropriately enough, when his cell phone rang. It was Pepper. "Dude," Pepper said, "you better get back to the office."

By the time Frankel returned, he says, "the shit had hit the fan." The timing of Gnutella couldn't have been worse from the company's point of view. AOL was in the midst of trying to merge with Time Warner, which was involved in suing Napster for facilitating copyright infringement.

AOL ordered him to take the program down immediately, and the company put out a statement calling Gnutella an "unauthorized freelance project." But Gnutella, unlike Napster, couldn't be stopped. More than 10,000 people had downloaded the beta software that first day, and intrepid hackers had gone to work to reverse-engineer it and throw it into the hands of the open-source community, laying the foundation for BearShare, Morpheus, LimeWire and other file-trading wares.

With Gnutella, Napster became almost irrelevant. There was no company to sue, no computers to shut down. AOL had paid Frankel $100 million for a slice of the future, but Frankel decided he'd rather give the future away.

After that, Frankel says, AOL kept him on "a very short leash," steering him away from interviewers and encouraging him to focus on Winamp, the program they paid him 100 million friggin' dollars to work on in the first place. Not surprisingly, he acted out. In August 2000, he uploaded an MP3 search engine. AOL took it down. The next month, he uploaded to a secret section of the Nullsoft site a program called AIMazing, which would replace the banner ads in AOL's Instant Messenger with an image of a musical heartbeat. Frankel called it nothing more than "a cute innovation." The Wall Street Journal called Frankel "AOL's loose cannon."

AOL cracked down, again -- this time requiring Frankel to seek approval before blogging online. "We fought off the AOL bullshit as much as possible," he says. When the company tried to insist that an AOL icon instantly appear on a user's desktop during a Winamp installation, Frankel hit the roof. "I'd be like, 'Look, our users don't want to use AOL!' " he says. " 'They think AOL sucks!'"

But Winamp was having problems of its own, losing ground to Windows Media and RealPlayer, both of which incorporated video streaming. Nullsoft attempted to re-establish the brand with Winamp 3.0. But the new version was bloated, if not somewhat embarrassing -- particularly for Frankel, who prided himself on lean, simple wares. On Frankel's urging, Nullsoft trimmed back the next version of the player, calling it Winamp 2.9.

Around that time, Frankel began tinkering with a new kind of software. Taking the name from an underground postal system in the Thomas Pynchon novel The Crying of Lot 49, Frankel created Waste: a "private workspace," as he calls it, that allows small groups of friends to trade files without being as conspicuous as those on the larger peer-to-peer networks.

Sometimes called a "darknet," it's a kind of mini-Gnutella, a small, password-protected file-trading network. Because you can't get in unless you're invited, even the most intrepid hackers -- or recording-industry lawyers -- would have trouble figuring out when or where a Waste system is running.

This time around, Frankel took the high road. He tried pitching Waste to AOL, but after the company dragged its feet for months, he got fed up. On May 28th, 2003, four years to the date that he was acquired, Frankel rebelled again -- uploading Waste as a way to force AOL to deal with it, and him, once and for all. "AOL as a company should not just sit on their asses and try to keep from losing as many subscribers as it can," he says. "I mean, I'm a stockholder of the company. I want them innovating. I want them doing things that are good for the world and being socially conscious."

AOL responded by taking the program down. (AOL had no comment about Waste for this story.) Days later, Frankel took it to the people one last time. "For me, coding is a form of self-expression," he wrote online late one night. "The company controls the most effective means of self-expression I have. This is unacceptable to me as an individual, therefore I must leav [sic]. . . . "

Shut your mouth! Shut your mouth! Raise your hand if you need to take a piss!"

Night is falling on Frankel's warehouse, and we're midway through an impromptu jam onstage. Frankel's half brother Brennan, another Nullsoft staffer, is belting out these lyrics for a song about obedience and oppression. When I joke that it sounds like it's inspired by real life, no one argues. "America Online as a company is all right," Frankel says diplomatically, "but big companies have limitations about what they can or can't do."

A few weeks after I visit, AOL proved his point once again. On December 9th, the company shut down the San Francisco office that once housed Nullsoft and Spinner, and laid off 450 employees, including Frankel's half brother. The next week, Frankel uploaded what could be his swan song as an AOL employee: Winamp, version 5.0. In the near future, he says, he's going to have a sit-down with his boss and enthusiastically return to a riskier way of life. This could include some new programs such as a free and open solution for mobile text messaging -- a kind of Gnutella spin on BlackBerry -- or some other stuff that he won't reveal. "Those are the really good ideas," he says.

In many ways, Frankel's future encapsulates the debate over the future of the Internet itself. Does it become just a distribution system for corporate product or more of a way to subvert that corporate control? For Frankel, subversion is in the eye of the beholder. "The question is," he says, "do you think people are ultimately good or bad? Do they want to do the right thing, or do they want to do what's good for them and fuck everyone else? I hope it's not the latter."

With our song done, Frankel and Brennan tweak the mix into shape. "I'll put this online," Frankel tells me, cracking a grin, "with your permission, of course."
http://www.rollingstone.com/features...n.asp?pid=2763


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Music Fans Find Online Jukebox Half-Empty
Frank Ahrens

The world's largest music company had been hectoring rock singer Tom Petty since last summer. You've got a big and popular catalogue of albums, Universal Music Group said. We've got to put them up for sale on the Internet -- they're being traded free every day on the Web and we're all losing money.

He should have been an easy sell. The Internet-savvy Petty let fans download one of his songs back in 1999. After some haggling, he and Universal agreed to make almost all of his songs available for purchase online.

But Petty's fan's did not get everything they wanted. Online buyers will not get their hands on Petty's outtake songs, studio tunes that rarely made it onto albums and are craved most by many hardcore fans. Petty controls the rights to those songs, unlike the bulk of his songs, which are owned by Universal, and he held them back for fear of diminishing the value of a 1995 CD boxed set that included them.

The Petty case underlines the complexity of buying and selling music online. A hornet's nest of performance and publishing copyright laws, marketing decisions, artists' egos and negotiating power plays can stop people from legally buying songs on the Internet, just as millions are trying to do so for the first time.

One of the hotter holiday gifts was the iPod, Apple Computer Inc.'s MP3 player, a device about the size of a cigarette pack that can hold as many as 10,000 digital songs. The iPod and other MP3 players are used to play music downloaded from Internet services such as Apple's iTunes, launched last April.

By the end of 2003, iTunes had sold more than 30 million songs at 99 cents each. Similar services, such as the revamped Napster, BuyMusic.com, Musicmatch, Rhapsody and even one on the Web site of Wal-Mart sprang up, some with lower prices, most with strong sales numbers.

But fans who venture onto any of the pay music sites will not find the most popular band ever, the Beatles. They will not find other top-selling acts, such as the Dave Mathews Band, Garth Brooks, the Grateful Dead, AC/DC and the Cars.

They will find that top-selling acts Madonna and Red Hot Chili Peppers sell their songs by the album, but not as singles.

They will find some musicians on one service, but not on others. They will find puzzling choices: Led Zeppelin fans can buy a 47-minute spoken-word biography of the band online, but no Zeppelin songs because the band has not licensed them for sale on the Internet.

Petty's fans, however, are mostly happy now. Fans will be able to buy and download beloved hits such as "Don't Do Me Like That" and "You Got Lucky." The songs went up for sale on Napster last Monday.

"Basically, it was Universal that was driving me crazy for the last six months" to put Petty's catalogue on the Internet, said Tony Dimitriades, Petty's manager for the past 28 years. "From our point of view, we wanted to make sure the business model had no unfair implications for the fans or for Tom."

But Napster had no say in the decision by Petty and his management to hold back the outtake songs.

"I got a call from Universal Music Group saying, 'You can't make these songs available,' " said Aileen Atkins, Napster's chief counsel and negotiator.

Some artists, such as cerebral Brit-rockers Radiohead, believe their albums should be listened to in their entirety and will not sell them online as singles.

Securing rights to the band's songs reflect the many cracks that exist in a system that encompasses sprawling music companies, far-flung publishers, temperamental artists and mega-retailers to be on the same page. Until last Monday, several songs from Radiohead's "Kid A" CD were for sale for 88 cents each on Wal-Mart's online music site. A day after Radiohead's label, EMI, was informed of that by a reporter, the singles were gone, replaced with a note reading, "song not sold individually." EMI said it noticed the Wal-Mart transgression the previous week.

Madonna may be the ultimate singles singer and is also among the most powerful. She can dictate that her albums be sold online as whole works or not at all.

"There is the philosophy that it cannibalizes album sales," said Caresse Henry, Madonna's manager for the past 14 years. Madonna probably will begin selling singles online in the coming months, Henry said, but maybe not through one of the existing services.

Another factor holding up Madonna's singles: royalty rates. Musicians should be paid a higher royalty for songs sold online than those sold in CD or album form, Henry said, because in the online world the record companies do not bear the costs associated with manufacturing CDs. When iTunes sells a song for 99 cents, 70 cents is paid to the artist's record company. The artist typically gets 10 to 15 cents; the songwriter, about 8 cents.

Though Henry said she is not happy that her client loses money to free online song sharing, "thank goodness Madonna has had a successful career and made money."

Wal-Mart and BuyMusic have agreed to Madonna's terms -- her recent "American Life" album is sold online -- but iTunes and Napster have not. Apple Computer Inc. founder Steve Jobs is so adamant about selling singles, as is Napster, that he would rather keep Madonna off iTunes until she agrees to sell her songs individually.

"It's not that we don't respect the concept of the album as art, but particularly in light of fact that all the tracks are available individually on every illegal free service, it doesn't seem to make sense that they're not available in other than on album format on the legitimate services where the artist actually makes money," said Napster's Atkins. "To compete with the illegal sites, we need to at least offer consumers what they can get there, so maybe the artists have to look at that and make different decisions."
http://www.washingtonpost.com/wp-dyn...2004Jan18.html


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In case you missed it…

Free Album Downloads!
Press Release

From October - We at Go-Kart Records want to make it perfectly clear that the RIAA does not represent the views of all record labels. So, we are putting our music where our mouth is to prove a point. We believe that if you like the music you hear you will support it by going to shows, telling your friends, and buying the bands CDs. With this in mind, we are allowing people to download some of our current releases AT NO CHARGE. In other words, we are essentially GIVING these albums away!

We feel that only by embracing technology can we gain from it, and that a battle like the one that the RIAA is fighting can simply not be won.

We do not believe that online downloads are all that is hurting the music industry. It is a combination of problems, CD burning being the most injurious. Of course, major labels will never take action against the manufacturers of burnable CDs, since in some cases they would then have to sue themselves (why would Sony sue Sony?) Instead they are going after the music fans, whom they hope to intimidate and extort.

We also feel that the lack of original and meaningful music is part of the major labels' problem. Simply put, if there is better music, people will spend money to own it instead of downloading or burning it. The success of Itunes proves that people are willing to buy music online if it is delivered in an intelligent way that is respectful of the consumer.

The major labels control almost all the means of exposure available today. How can you sell records without exposure? Radio is controlled through payola (or its modern form, consultants), the print media is controlled through quid-pro-quo agreements of ads for coverage and vice versa, retail is controlled by co-op dollars (which also includes in-store play for videos), and they even buy their artists' way onto opening slots on tours. So, with a few exceptions, the new music that most people are exposed to is controlled by the five major labels. But they CAN'T control what people download. All they can try to do is control people's access to MP3s, or scare them out of downloading music altogether!

These songs are all RIAA safe! If you like what you hear, please make a donation (see the PayPal button), check out the bands' shows, and spread the word. If you don't, what have you lost?

To read a more in depth article about why we feel the RIAA is wrong please click here http:// www.gokartrecords.com/freedownload/riaa.php and please send this email and/or the open letter to the RIAA to as many people as you can. Only by educating each other can we hope to take advantage of the technical innovations and not run scared from them.

To read an interview discussing this with Greg from Go-kart go here http://www.openp2p.com/pub/ a/p2p/2003/09/25/gokart.html

Also, make sure to check out our upcoming release, the first commercially sold MP3 Sampler called GO-KART MP300 RACEWAY featuring 150 bands and 300 songs. Visit www.gokartrecords.com/mp300 for a demonstration.
http://www.gokartrecords.com/__BOARD...y;threadid=637


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Software Piracy Is in Resurgence, With New Safeguards Eroded by File Sharing
Douglas Heingartner

LONDON - Inside a nondescript office building here, investigators for the Business Software Alliance are working to track down software pirates around the world. To help maintain secrecy, they often rely on several computers running on different operating systems, with special programs allowing them to switch Internet service providers every 60 seconds.

"I can be perceived to be in China in one minute and in the U.S. the next minute, so they wouldn't be able to track it back to me,'' said one investigator, who allowed a reporter to follow his activity on the condition he not be identified.

Long before downloading music and movies became a hobby of teenagers and others, the software industry was struggling to keep digital pirates at bay. Even in the pre- Internet 1980's, introducing software was fraught with peril.

"If it didn't have copy protection, you lost that market, and you would never get it back," said Deanna Slocum, an antipiracy manager at Macromedia, which makes multimedia business software.

Since then, the industry has developed techniques to safeguard programs and thwart pirates, and global software piracy rates have declined somewhat. Yet the advent of peer-to-peer, or P2P, file-sharing programs like Kazaa is quickly eroding those gains. As many file-swapping advocates note, P2P is agnostic - it embraces all digital files, be they Beastie Boys songs, knitting patterns or high-end computer programs.

The amount of software piracy attributable to Internet file sharing is difficult to determine, in part because not every downloaded file represents a successful installation. But William Plante, director for worldwide security at Symantec, estimated that roughly half of the illegal copies of his company's software, which focuses mostly on protecting computers against viruses, stem from electronic downloads.

The Business Software Alliance estimated global losses from all software piracy at just over $13 billion in 2002. The global software market that year was valued at $152 billion, according to Ovum, a research and consulting firm.

"Internet piracy is the fastest-growing form of piracy," said Jeffrey Hardee, a vice president of the alliance. "It's really quite phenomenal.''

Why now? One reason is the ascendance of high-speed Internet access, which makes downloading giant files feasible for millions more people. Convenience is another: the easy use and availability of free peer-to-peer software largely makes it unnecessary to learn older and more complex file-exchange systems like FTP or Usenet.

"Increasingly we're finding that people are skipping straight to P2P," the investigator for the alliance said.

The organization, which has three antipiracy monitoring centers - one here, one in Washington and one in Singapore - is loath to have the exact locations of these operations disclosed, because its investigators are sometimes subject to threats from those who object to their antipiracy efforts.

Sitting at a computer in the center, the software investigator quickly spotted a P2P site offering multiple versions of popular (and expensive) programs like Macromedia's Dreamweaver, Adobe's GoLive and even a full version of Microsoft's Office XP. Many contain text files that explain how to install the software, which has been "cracked'' by hackers to defeat its copy protection, making the process almost foolproof.

Beyond relying on an automated Web crawler that scours the Internet for unauthorized files, alliance investigators also try to snare pirates by gradually building relationships with them, using assumed identities. After pinpointing a transgressor's Internet address, they send a note to the company that provides Internet access to the pirate, requesting that the files or sites be removed. The responsiveness varies, but service providers on good terms with the software alliance often comply "within a few hours," the investigator said.

But as some pirates find better ways to mask their identities, it is becoming harder to track them. "They're truly ghosts on the Internet now,'' Mr. Plante of Symantec said. "They're virtually untraceable."

Another problem is users' motivation. Fly-by-night Web stores that sell pirated software on CD's and DVD's are a nagging reality, but many pirates are in it for the kicks.

"It's about getting recognition," said Drew McManus, who directs Adobe's antipiracy operation. "It's about being the first or the best at cracking."

Some are so fast that pirated versions of new programs often hit the P2P networks before they are officially released, a problem that also plagues Hollywood.

Adding to the worries is the relatively recent appearance on P2P sites of high-end business software like AutoCAD, an industrial design program that can sell for more than $3,000. "You basically need to be trained in that in order to use it," the alliance investigator said. "It's a professional program."

How are the software companies fighting back? "I don't think anything is off the table," said Robert M. Kruger, a vice president of the software alliance. "You're competing against free, and that's hard to do."

One approach is mandatory online activation, which Microsoft, Adobe, Symantec, Macromedia and others, have introduced for some products. Software pirates have already cracked many of these new registration methods, a familiar development in the antipiracy battles.

"Yes, you can crack it," Mr. Plante said, but he added, "It's extremely inconvenient to try and use the cracked version."

Smaller software firms that cannot afford pricey copy protection technology sometimes adopt an ambivalent attitude toward peer-to-peer theft. Edwin de Koning, a Dutch programmer, created with a colleague, Bart van der Ploeg, a video mixing program called Resolume that sells for about $200. The program, which has attracted a few hundred buyers a year, recently began proliferating on the P2P networks.

That "hits us in the wallet directly," Mr. De Koning said. "But in the end, there's also a positive side. There's more and more video software coming out, so in the beginning we want to get a big share of that. If there weren't P2P software, I think we would be less popular."

Building a customer base in part through illegal copying is anathema to many in the industry. "I strongly take exception with someone that would promote the idea of seeding the market with illegal copies so that they could somehow get future revenue," Mr. Plante said. "That's just a flawed business model."

A more nuanced solution revolves around meeting the P2P networks halfway. In 2002, for example, Microsoft used the Kazaa network to help start its media player, which is free software for anyone who has the Windows XP operating system. "By promoting Media Player 9 through P2P networks, Microsoft is embracing the promise of P2P technology, while respecting the importance of preserving intellectual property," Tim Cranton, a Microsoft lawyer, said in an e-mail response.

Mr. McManus of Adobe says he is also intrigued by the potential of P2P. "We've actually been looking at Kazaa specifically," he said. "Adobe's always interested in innovation, and if there's ever a more efficient way for our customers to get our software, I think we have to look at it."

But Josh Bernoff, an analyst at Forrester Research, warns: "One reason not to do that is that it helps legitimize the existence of these services. It's the same argument that allows you to buy a crowbar, despite the fact that it can be used in a burglary."

The P2P proprietors say they would welcome more cooperation with the software industry. Michael Weiss, the chief executive of StreamCast Networks, which makes Morpheus, a popular P2P program, has been challenging copyright law since he opened one of the world's first video stores in 1978.

The software industry, he said, "has to embrace the technology, just like the movie studios ended up embracing VCR's." He said he would "love to engage in discussions with the companies that want to," but added that in some respects their participation was immaterial.

"This is not going to go away," he said. "Technology always wins out. You would think the software companies would know that more than Hollywood."

Software files, however, may by nature be impervious to some of the problems that beset the entertainment industry's movie and music files. "Software is not just the code that comes with it," said Ms. Slocum of Macromedia. "Software is also the technical support, the customer service, the upgrades" - extras that are largely unavailable to users of illegal versions.

Eric Garland, chief executive of BigChampagne, which monitors file swapping for the entertainment industries, said that music and video accounted for 88 percent of the files on P2P networks (the other 12 percent consists of software and "everything else.") He says he sees this moment as a chance for the software industry to flourish where the entertainment industry has floundered.

"It's the carrot, not the stick,'' Mr. Garland said. "The only way to really marginalize online piracy is to make online retail so transparent, so convenient and so appealing that when you're faced with two icons - one that's an unknown, perhaps virus-infested crack on Kazaa, and the other that's double-click to download the legitimate version" - users will naturally turn to the official version.

In the meantime, the software alliance's sleuths have plenty to keep them busy. The organization recently discovered a P2P site, whose name the investigator declined to make public, that offers verified downloads of innumerable programs and can even locate files invisible to other P2P programs. You will not find it through Google.

"It's incredible how much you can get," he said. "It's too easy."
http://www.nytimes.com/2004/01/19/te...rtne r=GOOGLE


For some possibilities on this puzzling P2P site mentioned above check out the thread “Mystery P2P”. - Jack.


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Beyond File Sharing: An Interview with Sharman Networks CTO Phil Morle
Kirk L. Kroeker

"I have the benefit of many years thinking about P2P and its potential, and [the RIAA has] not got past the stage of fear," Phil Morle, CTO of Sharman Networks, told TechNewsWorld. "I am naturally disappointed that we are all wasting time and money on futile legal battles. P2P will endure."

The legal and social debate over the legitimacy of peer-to-peer (P2P) applications has made headlines since the days of Napster and Hotline -- and continues to be a major issue today. While there are certainly other hotspots in the tech industry, the P2P debate serves as a focal point for some of the most important issues of the day, such as security, personal privacy and copyright law.

On one side of this debate are applications like LimeWire, Morpheus, Bearshare and Kazaa , whose makers say their products have many uses and that they promote the legitimate ones and are not responsible for any illegitimate activities. On the other side are entertainment companies that see those products as taking revenue from music labels and artists. The two sides have waged an ongoing war in the courtroom, which continues unabated and in which consumers now find themselves as participants.

One can argue about the legality of such applications, but there is no debating their popularity. Sharman Networks' Kazaa P2P application has been downloaded more than 315 million times, making it -- according to Download.com -- the most-downloaded software in the world. Clearly, demand for these applications is still strong, despite the Recording Industry Association of America's push to squelch P2P file-sharing activities.

TechNewsWorld turned to Phil Morle, CTO of Sharman Networks, for an exclusive interview to talk about the future of file sharing and the latest developments in the world of P2P.


TechNewsWorld: Please tell us a little about Sharman Networks and what your role is there.

Phil Morle: Peer-to-peer software is an evolutionary development and not a revolutionary one. It is a very natural direction for technology to take. Every day, more people move more files, and these files get larger. Simultaneously, the same people own increasingly powerful computers that are underutilized.

Network resources are like any other resource that is needed by society, but if the Net were our water supply, our reservoirs would be depleted more quickly than we could build them while the entire population would have enormous, unused tanks of water in their backyards that stagnated. Sharman was formed to connect these water tanks to ensure that no one goes thirsty and the cost of water remains low.

Our main priority has been on solutions for media distribution. This area has seen explosive growth in file sizes and the demand for files. As media companies put their digital catalogues online, they are going to need the resource capacity to meet the demand. By using peer-to-peer for both streamed media and direct downloads, online distributors can save about 90 percent of the cost of traditional methods -- and in many cases can offer more robust, faster delivery through the intelligence of the peer-to-peer network.

We have been proving the model for the past two years, demonstrating that bands can make it big, movies can be released and game publishers can do excellent business over P2P. My role as CTO is to collaborate with our international technology group and the other areas of our business to develop Kazaa technology to meet Sharman's vision for P2P.

TNW: What would you say the biggest technical challenges are right now in the world of file sharing?

Morle: The benefits of distributed peer-to-peer networks create unique challenges that are not present in centralized environments. Users of the Kazaa application itself -- and not Sharman Networks -- manage the files on the P2P network, and our challenge is to give them the tools to manage it effectively. The network can only be created, organized and made safe by the users.

For example, Kazaa is the only file-sharing application with integrated antivirus technology. Using P2P technology, we push the latest virus definitions to users at an incredible rate. Users effectively give the definitions to each other. Automatically, they protect each other from viruses and clean the experience for other users at the same time.

We are making good progress on the security challenges. We are also looking at collaborative filtering techniques to empower users to manage the files that are available so that they are collectively responsible for removing bad files and categorizing and labeling good files effectively.

An example here is the metadata in digital photographs. There are billions of photos out there waiting to be shared by their creators, but they are lacking detailed metadata. We are looking at ways to facilitate fun and easy management of metadata by all users. The more complete the metadata, the better the search experience.

TNW: What about the most exciting technologies right now?

Morle: I am most excited about magnet links at the moment. Read more about these at magnetlink.org. Magnet links are an open standard that we have adopted to allow bloggers and other Web site creators to add P2P links to their Web sites or as links in an e- mail.

For example, if a blogger creates a short film but has a very limited bandwidth allowance, he or she can add a magnet link enabling consumers of the blog to download it from other peers using a P2P application like Kazaa instead of downloading directly from blogger.com. This breaks out file sharing beyond the application into the Internet at large.

When we released magnet links, we also released Kapsules. We are only just beginning to imagine the possibilities of these. They are basically ways of collecting distributed files together. When a user downloads a Kapsule, they have all the information they need to download all the files referenced in that Kapsule automatically across multiple sources. A client could try to search Kazaa for each file and -- if it fails -- try another P2P network, and if that fails then fall back to a Web server . With Kapsules, a world dominated by individual files gains the concept of collections of files, presented in context. We are considering making the Kapsule file format an open standard.

From this we can extend the application of Kapsules into a way of digitally packaging a collection with a multimedia presentation layer and value-add functionality, distributed playlists, distributed slide-shows and so forth. On a larger scale, we are also seeing the emergence of the next generation of P2P network layers and really exciting products that will use those layers.

I think 2004 will be the year that P2P becomes more than file sharing. Skype is a superb example of a P2P technology of this kind being applied to create tremendous value to users and businesses. Skype is a completely distributed VoIP solution built completely on P2P technology from lessons learned building Kazaa.

TNW: Would you say that Morpheus is your biggest competitor right now? Are there other clients, like LimeWire, that you admire or are partnering with for future developments?

Morle: Morpheus ceased to be our main competitor, or indeed a trusted solution for users, a long time ago. eDonkey/Overnet is a strong competitor. They have cool technology and millions of users. I am consistently impressed with their releases that show a passion for P2P and what it can accomplish.

I am also surprised that Shareaza stays under the radar. Mike, who develops it, is a very ambitious young man, and I have to wonder when he sleeps. Shareaza is a well-made application that is a pleasure to use. His singular vision shines in Shareaza. He is also in Australia, demonstrating that the country is a center of P2P innovation today.

These talented groups have their sights firmly set on the file-sharing phenomenon as it is today -- but we are past that. We are focused on the future of file-sharing and the extension of P2P into next-generation consumer Internet tools. I am confident that we will continue to out-innovate these great companies in 2004.

TNW: While the latest Kazaa client declares that it is free of spyware, the client has been criticized for including spyware in the past. And now that the current client includes software that would be better described as adware, has Sharman Networks been listening to users about the spyware issue? And do you anticipate a time when the client will be adware-free?

Morle: We listen to users in a big way on this issue. Spyware is like the bogeyman of the Internet. The phrase gets thrown out there to strike fear into the hearts of users, but it is just a phantom -- a character in scary stories. It exists, but it is rare and certainly not distributed with KMD. Nothing goes into KMD without going through a very detailed acceptance testing procedure that ensures that the integrity of a user's privacy remains intact. No way will we allow anything that spies on users into our installer.

Ads are necessary for us to run our business -- as necessary as they are in modern television, radio and print. Viewing the ads is the payment for the free software users enjoy. We do install some advertising software, or adware, with Kazaa, but we are careful to keep this to a minimum. We install GAIN (which displays contextual advertising) and PerfectNav (which suggests Web sites to look at if a Web site cannot be found) only. eDonkey, as an example of another mainstream P2P application, installs Webhancer, TopText, New.Net and nCase.

Altnet is sometimes incorrectly cited as adware. This software is the P2P software that powers our premium content delivery. Altnet TopSearch displays premium content to users in search results in the form of gold icons, and Altnet PeerPoints gives users redeemable points (like frequent flyer points) for sharing premium files. Over time we are migrating from adware to other revenue streams as those revenue streams mature. We have so few adware products because revenue generated through content distribution is growing very well.

TNW: What is your general feeling about the RIAA?

Morle: Mostly disappointment. I have the benefit of many years thinking about P2P and its potential, and they have not got past the stage of fear. I am naturally disappointed that we are all wasting time and money on futile legal battles when everyone could be growing their businesses and benefiting users today. P2P will endure. We at Sharman have great confidence in this, and in the future we will look back and wonder what all the fuss was about, as we do today with videocassettes.

TNW: How about personal privacy on P2P networks? Is Sharman Networks planning any privacy-protection measures like those found in some Kazaa Lite modules?

Morle: Where I differ from some other file-sharing CTOs is that I don't believe users have anything to hide. Creating default "darknets" through technology defines the purpose of the network as illegal and encourages a certain kind of activity. This is not what we are here for because P2P is an enabling technology for all and not somewhere to hide. The modules found in Kazaa Lite that claim to bring privacy to the user can cause problems with other Internet applications, decrease the performance of the software and are ultimately possible to work around.

Kazaa users are only identifiable by IP number in exactly the same way that Outlook users and Mozilla users are. The rights of an organization to subpoena ISPs for the identity of the user connected to that IP has just been rightfully overturned. This, of course, is a great victory for a user's right to privacy. The only privacy issue in Kazaa was the capacity to view the entire contents of a user's shared folder. This functionality is now disabled by default to prevent abuse and has been disabled for some time. We want to put the users in charge of their own privacy.

TNW: What do you see as the biggest threat to P2P technology?

Morle: I don't think there is any great threat to P2P technology. There is so much value in the technology and so many groups and individuals making great P2P software, I am not sure what force could stop it. The greatest threat would be that the application of P2P technology does not meet its potential because it is resisted by some.

TNW: What do you think the best use of P2P technology is?

Morle: Today I would say it is highly optimized for the delivery of media files at a price that's right for end users. We will see more and more games, movies and music collections distributed across the P2P nets. Recently, we have become very good at distributing movies. In the next 10 years, we will see P2P becoming more pervasive, used for many different P2P applications, even built into phones and TVs.

The great thing about P2P is its simplicity. This is what makes it so democratic. Anybody can just drag a file into a special folder and make it available to the world. Written a book? Just drag and drop. Launching your band? Just copy to your shared folder.

TNW: The age of grid computing is upon us. P2P applications like Kazaa have demonstrated the power of distributed computing. What do you see as the role of Kazaa in the future of distributed computing?

Morle: The file-sharing era has given us the opportunity to get the resource-sharing relationship right with millions of users. It is actually quite difficult for users to understand that their resources could be used when they participate in a grid.

This is something that I don't think many of the more theoretical grid-computing projects have put enough effort into considering. It needs to be developed with respect for users with the tools in place for them to be in complete control. They must also feel that they are getting back from the grid at least as much as they are putting in -- meaning costs are reduced or extra value can be had.

P2P is more than file sharing, and we are looking at many applications for it. We have the practical experience of making software that millions of users connect to at the same time. I expect we will continue to take a leadership position as the market blossoms.
http://www.ecommercetimes.com/perl/story/32641.html


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Big and getting bigger.

BitTorrent Statistics
Thomas Mennecke

BitTorrent has exploded onto the P2P community with a fanfare that is rarely matched. Considering the efficiency and resourcefulness of this community, its popularity is not surprising.

Although BitTorrent was best known for its availability of videos (i.e. TV shows) during its first days, just about any kind of file is available off this network. Its great resource of mp3 files has attracted a wide audience and allowed this community to grow to impressive heights.

In order to deliver you the latest numbers on BitTorrent, an administrator of Suprnova.org contacted us with the following information. We were allowed to deliver this information on the condition of anonymity. Suprnova.org is the largest BitTorrent tracking site, and is one of the key reasons for the network's success.

"So I though that I should use the data that I have at my disposal as an
Admin of suprnova.org to see if I could generate some interesting
information. …I souped up some data that you might find interesting:

A Bittorrent popularity analysis, derived from Suprnova.org statistics.

How does Suprnova.org gather BT statistics?

Suprnova.org itself is a sort of reversed spider when it seeks out statistics. Instead of searching for trackers itself, users feed it torrent files. It dissects the torrent file and stores the tracker that the torrent uses. It then asks that tracker for a 'scrape' list of all torrents it tracks, if the tracker supports this feature (all advanced trackers do) and if the feature is enabled (less and less these days), Suprnova.org receives a list of torrent hashes and accompanying stats (minimum is number of seeds and number of non-seed peers) and it stores this list. Then if a torrent is fed to Suprnova.org with a known tracker, it can look the torrent up by its hash and gets stats without having to immediately request a new list.

A side effect of this 'caching of hashes' by Surpnova.org is that it has
general info about all torrents on the trackers it can poll, and not only the ones that the users feed it.

Can these stats be used for a global BT peer estimate?

Since the birth of suprnova.org (roughly 6 months ago), it has been collecting trackers, and has been gathering statistics. It has about 2100 trackers listed in its database, of which roughly 560 are actively functioning and can be polled by Suprnova.org.


All large tracker URL aliases (different tracker URLs leading to the same tracker) are filtered out. While this list of trackers is far from complete (private trackers / trackers with disabled 'scrape'), it gives a clear indication of the usage of the largest open trackers out there.

Suprnova.org also has some other information, derived from the torrent files that were uploaded to it, of which the most interesting is the torrent's data file size (an indication of what kind of data is transmitted and thus the networks 'total storage' at any time).

What are these stats then?

(Active torrents - torrents with more then 1 seed - added because there are a lot of 'dangling' torrents with no seeds and 1-3 peers, which are not very interesting).

Statistics from the Suprnova.org global tracker cache @ 18-1-2004 3:38:

Total amount of trackers: 2,181
Total amount of active trackers: 561
Total amount of torrents: 67,354
Total amount of active torrents (seeds>0): 25,212
Total amount of seeds: 213,484
Total amount of non-seed peers: 792,983
Total amount of peers: 1,006,467

Suprnova.org torrent database data:

Total amount of torrents received to date: 97,275 (100k draws near)
Total amount of live torrents: 34,290
Total amount of live active torrents: 14,091
Total amount of seeds: 169,861
Total amount of non-seed peers: 631,246
Total amount of peers: 801,107
Average filesize active torrents: 643Mb
Average filesize all torrents: 426Mb

Combined rough stats:

* An estimation of the amount of data on the global tracker network can
be calculated by taking the average file size of Suprnova.org's active torrents times the amount of seeds, plus the file size times the amount of non-seed peers times 0.5: 392.4 Tb

* Roughly 60% of the torrents out there have no seeds, but these
torrents usually have only a few peers attached. (less then 10% of the total amount of peers)

* The global seed / non-seed ratio is roughly 21%/79%

* It can also be concluded that Suprnova.org knows about roughly 60% of all public torrents out there, which contain 80% of all the peers connected to the open trackers.

Which would put BitTorrent at least as nipping at the heels of the currently popular p2p programs, and that with only a very modest estimate which covers only the public trackers. Of course you have no way to verify any of this data, but I am fairly certain that there aren't any other groups who have that kind of detailed information about the BitTorrent network."

Its important to realize that this information was only collected from Suprnova.org, and does not include statistics available from other tracking sites. This conservative estimation of over 1 million peers places BitTorrent among the heavy hitters of file- sharing, such as Overnet, eDonkey and FastTrack.
http://www.slyck.com/news.php?story=370


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Seeing Payday, Not Piracy, Musicians Put Concerts on the Web
Seth Schiesel

SHORTLY after Phish, the improvisational rock band, finished its New Year's Eve concert at American Airlines Arena in Miami, perhaps a couple of hundred people remained at play in the private suites that lined the hall. Brad G. Serling, as big a Phish fan as they come, joined them briefly but soon had to depart for the bowels of the arena.

"Everyone's making plans to go party, and here I am making plans to go to the production office," said Mr. Serling, 31. His tone was a bit rueful, but he was certainly not complaining.

That is because there was no place Mr. Serling, a Johnny Appleseed of online concert recordings, would rather go. By 2:30 a.m., he later recounted, he had the entire concert on his iPod, courtesy of the band's sound engineer. At 4:30 a.m., he was back at his hotel in South Beach, transferring the more than two gigabytes of audio files to one of the three laptop computers he had brought along.

Later in the day, from a hotel with a faster Internet link, he uploaded the concert files to the Internet. And so, by the morning of Jan. 2, Phish fans worldwide could pay $11.95 to download the New Year's Eve concert from Live Phish Downloads (www.livephish.com), a site run jointly by the band and Mr. Serling's company, Nugs.net.

Mr. Serling had also joined forces with three less-prominent bands - the Radiators, the String Cheese Incident and Yonder Mountain String Band - to post recordings of their own New Year's concerts at another site, LiveDownloads (www.livedownloads.com).

As other technology companies scramble to match the success of Apple's online music store, iTunes, which sells songs for 99 cents each, a different online-music economy is emerging around the sale of recordings of live performances - often with no restrictions on how they can be played or shared.

Since it was established in late 2002, Live Phish Downloads, which now offers audio files for about 50 Phish concerts, has generated more than $2.25 million in sales. Its success has helped prompt a new look at the potential for bands to become their own distributors online.

And on Tuesday, Coran Capshaw, manager of the Dave Matthews Band, said the group had agreed to set up a downloading site with Nugs.net. While other bands following a similar model have focused on selling concert recordings, the Dave Matthews Band intends to begin in March by selling downloads of its album catalog, to be followed shortly by sales of concert recordings. (RCA, the band's record company, is to receive part of the proceeds from the sale of albums online.)

Even Phish's record company, Elektra, which receives a small cut of the Live Phish Downloads proceeds, has embraced the band's online marketing of its music.

"We always thought it would be nice for there to be a happy medium where the band gets more involved with the fans, and this seems to us to be a perfect way to do it," Brian C. Cohen, Elektra's senior vice president for marketing, said in a telephone interview. "It gives the fans access to officially sanctioned recordings. It conditions the fans to not expect to get these things for nothing, and I personally think it's a model, both for the record business and for bands, whether signed or not, to make money from valuable content and at the same time seed the relationship in a very positive way with the fans."

One way that selling downloads appeals to fans is by offering music files that are not crippled by limitations on where and how many times the file can be copied. Such so-called Digital Rights Management systems are used by many traditional online music stores. But most of the budding concert download sites, including Live Phish Downloads, sell unrestricted files.

"The No. 1 issue that most of the music industry has wrong is D.R.M.,'' Mr. Serling said in an interview last week at his home in Los Angeles. "Why make it harder for people to buy your product? The answer is fear, and you have to get over the fear. What would you do if you walked into Tower Records to buy the new Dave Matthews Band CD and the guy behind the counter said: 'Here's your CD. It's $18, but you can only listen to it in your den on one stereo. You can't take it to the car. You can't put it on your iPod.' You would laugh at him and walk out, right? It's the same thing here.''

"I don't live in a fantasy world," he added. "I know we're getting ripped off left and right by people copying our files. But people who are intent on ripping you off are going to rip you off no matter what you do. All we can do it make it easier for the vast majority of people who want to do the right thing."

However compelling that argument, Mr. Capshaw said the Dave Matthews Band had not decided whether its online offerings, particularly its albums, would be copy- protected or unrestricted. (For its part, Phish recently gave would-be pirates a new incentive to do the right thing, announcing that it was donating its profits from Live Phish Downloads to a nonprofit group supporting music education for children.)

Other bands, too, are being drawn to the model. In November, the hard-rock band Primus began PrimusLive (www.primus.com) with a company called BackOfficeMusic. Last month, the guitarist Steve Kimock started a live-concert download store in partnership with a new New Jersey company called DigitalSoundboard (www.digitalsoundboard.net).

A year ago Pearl Jam began offering downloads of live shows to fans who also bought a CD of that concert. Now, the band also offers concert recordings through iTunes, though only song by song.

But even as other bands and other companies get into the concert-downloading game, Mr. Serling is the sector's youthful godfather.

Growing up near Philadelphia, Mr. Serling became a serious fan of the classic rock of the 1960's and 1970's. By 1990, when he entered Cornell, he was regularly taping Grateful Dead concerts in the area that the band set aside for noncommercial tapers - and meeting like-minded fans through the Internet-based interest groups known as Usenet.

At that time, trading Grateful Dead tapes was an arduous experience, often conducted by mail, and there was one big problem: sound quality. "People have all of these subjective ratings for their tapes and someone's like, 'Oh this is an A+,' but then you get it and it sounds horrible," Mr. Serling said. "So I thought it would be great to put up clips from the tapes so you know what you're getting."

Given the bandwidth limitations of the early 1990's, that was a challenge, but by 1994 Mr. Serling had posted some audio clips from his collection to a computer server set up for Grateful Dead fans. And so the seeds of Nugs.net were planted.

After college, Mr. Serling went to work in a new kind of business - Web design and consulting - where his company did not mind his using the corporate bandwidth. In 1995, he started offering RealAudio streams of shows. In 1997, he bought the Nugs .net domain - short for nuggets - and in 1999 began offering MP3 tracks that could be downloaded and replayed.

Meanwhile, Mr. Serling continued to collect and post concert recordings of bands that allowed taping. By June 2000, fans were downloading 500,000 MP3 files a month from Nugs .net, from bands including the Grateful Dead, Phish and the String Cheese Incident. The demand was met with the bandwidth of Mr. Serling's new employer, CinemaNow, for which he became chief technology officer.

When Nugs.net hit that mark, Mr. Serling said, "that was when I saw that there was enough interest to make a business out of it" - in other words, to begin selling recordings, if permission could be obtained.

Around the same time, the same idea appeared to occur to music executives, including John Paluska, Phish's manager. "We became aware of Nugs.net in particular as a very well-run and successful fan site that had both a lot of shows, high-quality shows and, even more than that, high reliability and customer satisfaction, even though it was just a fan site," Mr. Paluska recalled in a telephone interview. "So we started looking around and asking, 'Who's running this site?' "

The result was a collaboration between Phish and Mr. Serling called Live Phish Downloads, established in December 2002, which now posts live recordings of every Phish concert for sale within 48 hours. Profits are divided between the band and Nugs .net on undisclosed terms.

Last summer, when it was clear that Nugs.net had made the leap from fan site to business and that Mr. Serling had made the leap from Johnny Appleseed to commercial farmer, he quit his job at CinemaNow.

Now, from a spacious house in the Hollywood Hills, with a microwave antenna pointed at a receiver somewhere in the flatlands below, Mr. Serling is just trying to stay ahead of his new competitors. In addition to a deal with the Dave Matthews Band, Nugs.net has reached a broader agreement with Musictoday, a company run by Mr. Capshaw that provides Internet services to more than 250 other bands, including Metallica and the Rolling Stones.

Musictoday already offers services like Web stores, ticketing and fan club support to its artist clients. Now, Musictoday will also offer those bands a downloading service powered by Mr. Serling's operation. For Nugs.net, the Musictoday deal is meant to expose the company to hundreds of bands without having to hire dozens of salespeople.

"Hopefully this deal can help us get to the next level," Mr. Serling said.

Until now, most bands that have embraced selling concert recordings are best known for their improvisational live performances, not studio albums. Mr. Serling acknowledges that his distribution model might not appeal to every musical act - at least until there is more evidence of potential profits.

For now, though, after years of running Nugs.net as a labor of love, Mr. Serling feels as if he is living a fantasy. In addition to the pay sites, Nugs.net still offers dozens of concerts free, in both streaming and downloadable formats.

"This is what I would be doing even if there were no LivePhish.com," Mr. Serling said. "I would be out there as a taper with my recording deck and making files and putting them up on Nugs.net. It's nice to be able to do the same thing and also pay the rent."
http://www.nytimes.com/2004/01/22/te...ts/22band.html


~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Online with Eric Garland, Chief Executive, Big Champagne.

Internet Piracy: Recording Industry Lawsuits

The recording industry's latest attempt to stop illegal digital music swapping targets 532 defendants, the largest amount of people it has sued so far. Eric Garland, chief executive of Big Champagne, tracks Internet "file sharing" in the United States and overseas.

Garland and washingtonpost.com reporter David McGuire were online Thursday, Jan. 22 at 1 p.m. ET to discuss Internet piracy.

________________________________________________

David McGuire: Hi Eric, thanks for joining us today. Your company, Big Champagne, tracks the usage of peer-to-peer networks pretty closely. What does your research tell you about what effect, if any, the recording industry lawsuits have had on downloading?

Eric Garland: We use an empirical measure -- that is, the number of nodes (people/ computers) logged on to file sharing networks simultaneously (at any given time), and the number of files available. By that measure, the rate of _growth_ in file sharing may have been affected, but there has been no net decline in recent months. On the contrary, the popularity of file sharing is at an all-time high.

_______________________

Arlington, Va.: How should people know what numbers or surveys to believe? The RIAA says downloading is down; NDP and you say it is up. What gives?

Eric Garland: Remember the story of the blind men feeling the elephant? The man holding the tail said, "an elephant is like a rope!" while the man holding the ear said, "no, an elephant is like a fan!" Of course, they were both right and wrong altogether. I think that surveys are in some ways no different. There is truth in every observation, but without a lot of contextual information (or read in a screaming wire story headline -- FILE SHARING UP! NO, IT'S DOWN!), each study becomes meaningless.

Now, having said that, I have seen little evidence that all of these studies are really in conflict:

Survey studies (like the Pew report) tell us that people are no longer _admitting_ that they download when asked by a telephone survey company. This is important, and a win for the RIAA, as it indicates that people now _know_ that the RIAA wants them to cut it out, they have been "educated" and they no longer brag about all that free music. However, this doesn't mean that they don't download, only that they do it more quietly. We call this a gap in the "say/do," and it is typical when it comes to socially stigmatized behaviors like alcohol consumption or illegal drug use. Now music downloading has joined the ranks!

Of course the other broad category of P2P study is empirical: what do we _see_ people doing? Here, companies like BigChampagne and NPD agree, based on similar methods, that file sharing is on the rise. We differ in our conclusions about _why_, however. NPD suggests that file sharing dipped in the summer following the announcements of pending RIAA litigation. We, however, have seen similar declines in use in previous summers (when there was no threat of lawsuits) and believe that perhaps people are just getting a little sunshine in July and August, rather than swapping tunes.

_______________________

Washington, D.C. : Seems like the popularity of Tivo and other digital recording devices would have led to the sharing of not just music and movies but also television shows online. Are we seeing that sort of thing happening on the P2P networks, or through swarming technologies like BitTorrent? If not, why not? Thank you.

Eric Garland: Absolutely. Feature film and television are the fastest _growing_ media on file sharing networks. While the number of MP3 files still dwarfs movies and TV, bit for bit there may now be more film swapped online than anything else.

_______________________

Arlington, VA: With the use of high speed internet and routers making sometimes 3 computers able to surf the net at the same time, how does the RIAA get an IP address? Don't they change each time a connection is made and how can a distinction be made between different machines on one hub?

Eric Garland: I should be clear: our company does not work with the RIAA in their enforcement efforts, so I have no particular insight into their methods. Your question, however, points to one great difficulty that the industry faces.

In short, I think that a few hundred (soon to be a few thousand) lawsuits are intended to educate and dissuade (like speeding tickets), but it is not their intention to hunt down every last infringer.

_______________________

strange question but...: Is there any possibility that there are "secret" or underground p2p networks out there that are doing a brisk business in trading but are unknown to the authorities or the music industry? Sort of like a p2p speakeasy? I guess if there were it wouldn't be a secret, but maybe?

Eric Garland: Certainly. Remember that any two (or more) networked computers can be used to swap files, and therefore there are at least thousands, and likely many more, "mini-P2Ps" that are underground and there to stay. Keep in mind that a great deal of file swapping takes places locally, meaning the users of the network are not even _on_ public internet, and will therefore remain truly anonymous.

Again, I think the RIAA clearly intends to try to reverse the growth of massive widespread online infringement -- this is a war on the scope, not on every last file swapper.

_______________________

strange question: the sequel: So with the speakeasy concept in mind, would you ever even dream of venturing a ballpark figure about how many file sharers there REALLY are out there?

Eric Garland: Some very good survey work has been done in this area by Ipsos- Insight (formerly Ipsos-Reid) as well as Forrester (we contributed to their last study), among others. In this country, most agree that the _total_ number of file sharers numbers about 60 million.

In our observation, the USA consistently accounts for between 55 and 60% of users worldwide. So sure, I'd venture a ballpark figure: I think there are likely 100 million people sharing files.

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Dulles, Va.: Can illegal file-trading conducted on small P2P networks be tracked?

Eric Garland: Without explicit permission from each user (think of a TV viewing family with a Nielsen box), only public Internet activity can be tracked.

So if you want to swap files locally (sit in the office and swap with your wife in the kitchin), you're probably pretty safe LOL!

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Washington, DC: Other than illegal P2P networks that consume massive amounts of storage and clog up bandwidth around the globe, what else is pushing the demand for internet hardware?

Eric Garland: More than P2P networks, hardware demand is driven by digital media. People like the idea of music, movies and photos that they can acquire online, manage on the desktop, export to portable devices and take on the go.

I believe P2P is really a facilitator, or a symptom of this desire, and a pretty efficient model at that.

_______________________


Washington, D.C.: How can the P2P model be adopted by legitimate copyright holders for the distribution of their works?

Eric Garland: This is my favorite question, because I think it leads us directly to solutions to "the P2P problem," which is really just "the internet problem."

We now live in a world where people can and will exchange information, globally and instantaneously. There's no turning back the clock on that.

Now, remember that to a computer, music is just information -- bits and bytes. Unless we unplug the internet (as one music industry executive suggested, facetiously), here's the deal, in layman's terms: stuff is gonna get passed around.

P2P is just distributed computing -- in many ways the internet is just a vast P2P network. Computers are linked (networked) and users communicate. Because of this underlying (scary) fact, the tools of massive infringement also include Microsoft's Outlook (email) and AOL's Instant Messenger (IM). Clearly the technology is here to stay.

So the mandate is clear: _charge_ for the distribution of copyrighted material online without naively believing you can control (or stop) that distribution.

Just think for a moment about the model for commercial radio. The music goes where it will, and artists and other rightsholders get paid.

Thanks for all the good questions.

http://www.washingtonpost.com/wp-dyn...2004Jan21.html















Until next week,

- js.













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