Go Back   P2P-Zone > Peer to Peer
FAQ Members List Calendar Search Today's Posts Mark Forums Read

Peer to Peer The 3rd millenium technology!

Thread Tools Search this Thread Display Modes
Old 20-02-08, 09:57 AM   #1
JackSpratts's Avatar
Join Date: May 2001
Location: New England
Posts: 9,854
Default Peer-To-Peer News - The Week In Review - February 23rd, '08

Since 2002

"The movies we love belong in some profound way to us, and part of us lives inside them. Sweding is Mr. Gondry’s way of making that rather abstract sense of connection literal, of suggesting that even if we are not strictly speaking the owners and authors of the movies we like, well, then, perhaps we should be." – A. O. Scott

"We have the usual small army of stupid lawyers that think we will piss our pants because they send us a scary letter. We are used to this sort of situation." – Gottfrid Svartholm

"The mainstream media doesn't believe that new media can embarrass them, hurt them or generally hold them accountable in any way, and they've never been more wrong." – Chez Pazienza

"Control. Corporations and governments have an insatiable appetite for it. But I think we're all better off when they go hungry." – Robert X. Cringely

"The RIAA reminds me most of the Godfather. Support the independent labels, but the big ones–fuck’em." – Jello Biafra

"This is the end of the music industry as we know it." – James McQuivey

"I didn’t survive to sit home on the couch and cry." – Linda Fisher

February 23rd, 2008

Digital Sales Predicted To Pass CDs By 2012

A new study from Forrester Research Inc. predicts that half of all music sold in the U.S. will be digital sales by the year 2011, with digital music surpassing the CD in 2012. The Massachusetts-based research firm says that digital music sales will increased with a compound annual growth of 23 percent over the next five years, bringing in $4.8 billion by 2012. However, CD sales figures will continue to decline to $3.8 billion by 2012.

"This is the end of the music industry as we know it," stated James McQuivey, VP and principal analyst at Forrester Research. "Media executives eager to stay afloat in this receding tide must clear the path of discovery and purchase, but only hardware and software providers can ultimately make listening to music as easy as turning on the radio."

Forrester adds that although major music chains such as Tower and Sam Goody have shuttered stores, when retailers like Best Buy and Wal-Mart give music less floor space, it will truly signal the end for CDs. The company also predicts that "experiments in ad-supported downloads will be silenced by the powerful combination of DRM-free music and on-demand music streaming on sites like imeem.com.:

McQuivey says that ad-supported Web music services are not the future and that ad-supported music should be "on the radio where it belongs." He also concludes that artists should be even more open to getting in bed with advertisers. "Artists who used to pretend that their platinum album success was really about their "art" will no longer have that luxurious pretense because labels won't sign them unless they agree to a barrage of sponsorship opportunities," McQuivey concludes. "There will eventually come a day when Chips Ahoy will contend with the Keebler Elves over who can be the official cookie of the Taylor Swift world tour."

War on Music Piracy
Heath Gilmore and Kerrie Armstrong

AS THE internet threatens to kill the established music industry, the Rudd Government is considering a three-strikes policy against computer users who download songs illegally.

The Government will examine new legislative proposals being unveiled in Britain this week to target people who download films and music illegally. Internet service providers (ISPs) there might be legally required to take action against users who access pirated material.

The music industry estimates 1 billion songs were traded illegally by Australians last year.

Under the three-strikes policy, a warning would be first issued to offenders who illegally share files using peer-to-peer technology to access music, TV shows and movies free of charge. The second strike would lead to the offender's internet access being suspended; the third would cancel the offender's internet access.

The policy would mirror legislation being introduced in Britain, which would require ISPs to police the activities of users.

Communications Minister Stephen Conroy said the Government was aware of the views put by the music industry for a code of conduct for ISPs to address file-sharing by subscribers.

"We will also examine any UK legislation on this issue [including any three-strikes policy] with particular interest," he said.

Music Industry Piracy Investigations general manager Sabiene Heindl said her organisation had been lobbying for the policy for 12 months.

She said action had been taken to remove illegally downloaded tracks from blogs, Cyberlocker and BitTorrent sites but this had failed to stem the estimated 2.8 million Australians downloading music illegally last year.

"Because P2P file sharing involves these music files sitting on individual people's computers, there is very little that MIPI can do to remove those files or stop them being shared," she said. "That's why we have been pushing a proposal to internet service providers for a commonsense system of warning notices which, if unheeded, would ultimately result in a user having their account suspended or disconnected."

National Internet Industry Association chief executive Peter Corones said his members' reservations over the three-strikes and code of conduct proposals would be discussed with Mr Conroy this week.

He said present legislation provided severe penalties for dealing in pirate sound recordings that infringe on the rights of artists, composers, record companies and music publishers. Yet there was no action to date.

Penalties include injunctions, damages and costs, fines of up to $60,500 for individuals and up to $302,500 for corporations per infringement and up to five years' jail.

"Internet service providers are not the enforcers of copyright," Mr Corones said. They are "a mere conduit" for internet connectivity.

Any action by the Government is likely to displease young broadband users. Quantum Market Research YouthSCAN released the findings of a new study this month showing 63 per cent of young Australians felt there was no point in paying for music that was freely available.

It asked 600 Australians aged between 10 and 17 across NSW and Victoria in August and September about accessing music.

Consultant Nick Dawes said a no-pay attitude had developed among young people because they did not fear any retribution.

Their attitude is: "If we can get it for free, why not?"

Whitehall Gives ISPs Piracy Deadline
Jean Eaglesham

The government will on Friday tell internet service providers they will be hit with legal sanctions from April next year unless they take concrete steps to curb illegal downloads of music and films.

Britain would be one of the first countries in the world to impose such sanctions. Service providers say what the government wants them to do would be like asking the Royal Mail to monitor the contents of every envelope posted.

Andy Burnham, culture secretary, told the Financial Times on Thursday that the deadline was a “clear signal” of the government’s determination to tackle rampant piracy, which the music and film industries blame for the slump in CD and DVD sales.

“Let me make it absolutely clear: this is a change of tone from the government,” Mr Burnham said. “It’s definitely serious legislative intent.”

The move is a significant escalation in efforts to make internet providers take action against the estimated 6m UK broadband users who download files illegally every year.

A creative industries strategy paper published on Friday commits the government to consulting on anti-piracy legislation this spring “with a view to implementing it by April 2009”.

ISPs say it would be almost impossible to check and stop illegal downloaders. The industry has cited data-protection curbs that prevent them from inspecting the contents of data files.

The strategy paper will not set out a blueprint for how the legislation would work. “We’re saying we’ll consult on legislation, recognising there are practical questions and legitimate issues,” Mr Burnham said.

“We’re not saying ‘here’s one we made earlier, here’s a bill’.”

The concept of a “three strikes” regime of escalating sanctions, referred to in reports of a leaked early draft of the strategy, had “never been in the paper”, he said.

The Department for Business, which will lead the bill’s development, said on Thursday night that the proposal raised “difficult legal issues”, particularly in relation to European laws on online privacy and e-commerce.

But the government is adamant that the complexity of the issues involved will not prevent it from legislating if necessary. Ministers are frustrated by the slow progress of talks between ISPs and the music and film industries.

Mr Burnham said there was “no burning desire to legislate”. But he warned that ISPs could forestall statutory sanctions only if there were “considerable moves forward ... a change in the nature of the dialogue [with] good and innovative business solutions that can address the problem in a different way”.

The anti-piracy proposals are part of a series of measures set out by the government on Friday and designed to support the creative industries. These include the creation of 5,000 apprenticeships a year, involving the BBC and Tate Modern among other employers, and an annual Davos-style “world creative business conference” in the UK.

Booty Call: Music Has-Beens Line Up to Sue The Pirate Bay
Ken Fisher

The Pirate Bay is no stranger to intrigue. We reported last November that the captains of the Bay were being pursued by none other than Prince, and they even told us they were being spied on by strange people in foreign cars. Agents of the Purple One?

Prince wants his day in court, but as recently as November, Prince's gameplan was to go after The Pirate Bay's revenue source. The copyright crusader formerly known as an artist has inspired others to consider battling the Bay, as it looks like The Village People, ABBA, and other has-beens are considering using The Pirate Bay's recent indictment in Sweden as a chance to grab headlines and some cash. The news was first reported by Swedish news site E24.

Prince and The Village People are committed to pursuing a legal decision against The Pirate Bay for substantial sums of money. In a statement, John Giacobbi of Web Sheriff, who would work with these artists in securing local representation in Sweden, said, "We're looking at damages of millions of dollars, and we will file in both US and Swedish courts." Giacobbi is also reaching out to ABBA, Van Morrison, and others to join the quest for "damages."

The quest for damages may be misguided, however, as The Pirate Bay likely does not have millions to pay out. Peter Sunde of The Pirate Bay told Ars that prosecutors' claims that the site earns more than US$3 million year are false. Sunde suggested that the site operates at a loss owing to the substantial cost of bandwidth, hardware, and powering servers. If you ask us, ads for human pheremones (the only kind we ever see on the 'Bay these days) can't be bringing in that much money (can they??). It's hard to imagine a Swedish court serving up millions in damages when the Swedish prosecutor leading the government case against The Pirate Bay is only seeking approximately $180,000 in damages, according to the BBC.

TorrentFreak, which is strangely down right now, suggests that the attempt to recruit ABBA into litigation is really aimed at providing a Swedish "counter" to The Pirate Bay on their home turf. We agree with TorrentFreak's analysis: such a move won't work.

In fact, we'd go a bit further. All of these artists/bands risk a backlash, and for what? No one can deny them their right to get their day in court, but such public, high-profile lawsuits are always about more than the application of law. One has only to think of Metallica to realize that damaging one's business is easy to do if the anti-piracy rhetoric isn't carefully managed. Fans can react negatively, so artists have to weigh the risks of looking like they're out to punish fans. This is why industry groups like the RIAA usually lead the charge: they do the dirty work while (most) artists stay aloof.

Prince and The Village People won't stop piracy with their suit, and they might not even recoup any damages. In that respect, this is a "booty call" that carries with it a great deal of PR risk for only a small chance of meaningful reward. It's their battle to wage, but a victory would be pyrrhic at most. Remember, there's already litigation pending against The Pirate Bay.

In related news, we could find all of these artists' music on Tagoo, which just launched. If all of these lawsuits are supposed to be discouraging the opening of new torrent and search sites, it's obviously not working.

Music Publishers Sue MediaNet Over Copyright Flap

Members of the National Music Publishers' Association (NMPA) have filed a class action copyright infringement lawsuit against MediaNet, a company that powers digital music services for Microsoft, Yahoo, MTV and others. The suit claims that MediaNet failed to obtain proper licenses for the use of songwriters' and publishers' works, according to Digital Media Wire. The plaintiffs in the suit include Sony/ATV Songs, Peer International, Frank Music Corporation and MPL Publishing.

MediaNet Digital was formerly called MusicNet and was originally formed in 2001 by several major record labels in partnership with AOL and RealNetworks. The company was later sold to Baker Capital in 2005, and the publishers in the lawsuit claim that MediaNet's new owners have refused to enter into a similar licensing agreement that its previous owners did.

"This is a flagrant and egregious violation of the agreements music publishers were willing to make in order to allow new business models to flourish to the benefit of music fans," said NMPA President/CEO David Israelite. "These companies are now jeopardizing these services and acting not only in a manner harmful to songwriters and music publishers, but to consumers as well."

MediaNet fired back with its own statement, saying, "This complaint is completely without merit. In an age of rampant piracy, MediaNet is one of the few companies, along with Napster and RealNetworks, that pays copyright holders and artists for their work. The suit is contrary to the core beliefs and business model under which MediaNet (aka MusicNet) has operated since its inception."

The company added that, "MediaNet and others were licensed by the NMPA to distribute musical works until a final publishing rate was established, and this remains the case. NMPA's suit and PR push is a transparent political move during the Copyright Royalty Board hearings to establish an industry-wide standard. This is nonsense, and we look forward to the CRB reaching a final conclusion on rate standards."

RIAA Sends 13th Wave of Pre-Litigation Letters
Susan Butler

The RIAA has sent another wave of pre-litigation settlement letters to universities this week for its member labels. Another 401 letters went to administrators of 12 universities, who were asked to forward them to the individuals associated with certain specified IP addresses.

Recipients of the letters have the opportunity to avoid a potential copyright infringement lawsuit by settling out of court for a reduced fee.

Formal lawsuits have been filed against 2,465 letter recipients since the campaign first began last year, according to the RIAA. These individuals either chose to not settle the claim or were not given the option to settle early because the university failed to forward the letters. Of the 5,005 letters sent in prior rounds, the RIAA has reached settlements with more than 2,300 of those individuals.

The letters cite individuals for online music theft over the universities' computer networks via peer-to-peer services such as Ares, BitTorrent, Gnutella, Limewire and Morpheus.

The RIAA’s 13th wave of letters went to the following colleges: Boston University (35 pre-litigation settlement letters); Columbia University (50); Drexel University (33); Indiana University (40); North Carolina State University (35); Ohio State University (30); Purdue University (28); Tufts University (20); University of Maine System (32); University of New Hampshire (32); University of Southern California (50); and the University of Virginia (16).

The pre-lawsuit letters, sent to individuals at more than 150 schools, are one piece of a multi-faceted industry campaign to encourage fans to enjoy music legally. Despite years of warnings, educational campaigns and the availability of multiple legal options, online music theft, especially on campuses, remains a major problem for the music community.

"One year into our legal campaign, we’ve seen an emerging legal marketplace that would have struggled to gain traction were it not for our efforts to clamp down on online music theft,” says Cara Duckworth, RIAA director of communications.

According to the IFPI, there are now more than 6 million tracks available on 500 different licensed services.

The letters are in addition to the lawsuits that the RIAA-member labels continue to file on a rolling basis against those engaging in music theft via commercial Internet accounts.

RIAA Expert Witness is “Borderline Incompetent” Says P2P Expert

In a major file-sharing legal case in the United States, a renowned P2P expert has offered his critique of the expert witness report offered by the RIAA. Prof. Johan Pouwelse’s testimony will be a devastating blow to the music industry as he labels RIAA expert Doug Jacobson’s report as “borderline incompetent”.

In file-sharing cases, the prosecution always claims to have irrefutable, cast-iron, even forensic-quality evidence, with which to batter alleged pirates into defeat. Organizations such as the RIAA claim to carry out their investigations using sophisticated equipment and software which, unlike every other piece of equipment and software in the known universe (especially operated by humans) never, ever goes wrong.

In order to prove they ‘got the right guy’, in UMG v Lindor the RIAA offered an expert witness, Dr. Doug Jacobson, a director of the Iowa State University Information Assurance Center. Now, according to Recording Industry vs The People, Marie Lindor is fighting back and has served a report from her own expert, critiquing the RIAA’s witness. Internationally renowned P2P expert “Assistant Professor” Johan Pouwelse, agreed to take on the RIAA expert back in May 2007 having previously been a witness in a high profile case in the Netherlands.

His findings in this case aren’t pretty.

Pouwelse notes that there are certain procedures that need to be taken in order to be certain that a specific computer had been uploading copyright works. These steps were not taken.

He further states the the RIAA’s expert witness’s work lacked “in-depth analysis” and “proper scientific scrutiny” while reports were described as “factually erroneous”. Furthermore, in his report, Jacobson made statements which were contradicted by those in his deposition testimony.

Turning to MediaSentry - the company used to track alleged infringers - Pouwelse says that their systems and techniques have not been properly tested, are “overly simplistic” and “fail the test for accurate peer to peer file sharing measurement”. Additionally, many institutions have received false claims from them, seriously throwing their claimed accuracy into doubt.

Pouwelse states that the subpoena used to identify Ms. Lindor’s account was flawed and that due to the fact that there is no hard drive available to corroborate the ‘evidence’, this “further demonstrates the unfounded nature of Jacobson’s conclusions.”

And he doesn’t stop there in his criticism of Jacobson’s testimony.

He further states that no other alternative explanations were investigated and no tests were carried out to determine a margin of error. Jacobson’s methods are “self-developed”, “unpublished” and not accepted by the scientific community. Jacobson’s investigative process is stated as “unprofessional”.

In conclusion, Dr. Pouwelse’s expert opinion is that Jacobson has shown “borderline incompetence” and that the “allegations of copyright violations are not proven”.

It would be interesting for me to see what Pouwelse makes of the tracking system used by Logistep in Europe. Sadly, at this stage TorrentFreak has learned that lawyers Davenport Lyons are refusing to allow people to see the code and examine the system to check its accuracy. I wonder why?

Judge Dismisses Malicious Prosecution Lawsuit Against RIAA
Eric Bangeman

Exonerated RIAA defendant Tanya Andersen ran into a bit of a roadblock yesterday in an attempt to pursue her malicious prosecution lawsuit against the RIAA and MediaSentry. After a hearing, a federal judge dismissed Andersen's complaint, giving her 30 days to refile it with more specifics as to which laws the RIAA and MediaSentry are alleged to have violated.

Andersen filed her lawsuit this past August after the RIAA voluntarily dismissed its own file-sharing lawsuit. Andersen, a disabled single mother, was sued in February 2005, and the resulting case became one of the most closely-watched battles between the RIAA and suspected copyright infringers. After the case was dismissed, Andersen won an attorneys' fees award, which was reaffirmed last month.

Andersen's complaint recounts a litany of misdeeds allegedly perpetrated by the record labels in the course of their lawsuit. Those include trying to contact her young daughter at school and her apartment building without Andersen's knowledge or permission. The RIAA was also accused of libel, negligence, and fraud.

The RIAA hailed the judge's ruling. "The court's decision to dismiss all of the claims in their entirety merely serves to confirm our view that the claims were meritless when they were filed," an RIAA spokesperson told Ars.

In her ruling, Judge Anna J. Brown said that Andersen had "not adequately stated claims for relief," but gave her until March 14, 2008, to file an amended complaint. Lory Lybeck, Andersen's attorney, told Ars that he plans to refile and move ahead with the lawsuit. "The judge spent about 45 minutes to an hour discussing exactly what she was looking for in an amended complaint," Lybeck said.

In particular, Judge Brown is looking for more specificity around the slander claims, according to Lybeck, who also noted that the judge was "very knowledgeable" about the RIAA's legal campaign. He still believes that Andersen has a very strong case against both the record labels and MediaSentry. "The real case is that they blundered by misidentifying Andersen," he told Ars.

Copyright Tough Guys, Tories Face the Music for Using Song

Party in hot water after using tune in video without permission
Glen McGregor, with files from Andrew Potter, The Ottawa Citizen

As the Harper government prepares to introduce tougher new copyright rules, the Conservative party is being accused of using the theme song from the reality TV show The Apprentice without permission of the record company that owns it.

At a press conference on Sunday, the Conservatives presented an election-style attack video about the alleged costs of Stéphane Dion's spending promises, set to the musical refrain of "money, money, money, money, mo-ney."

The video was presented to support the Tories' claim that the Liberal leader would run up $62.5 billion in new debt if elected. It splices together video clips of Mr. Dion citing financial figures, accompanied by a segment of the 1974 hit song, For the Love of Money.

The press conference was led by Industry Minister Jim Prentice, who is also responsible for overseeing reforms intended to strengthen Canada's copyright laws. Copies of the video were broadcast by media organizations on national television, but have not been broadcast by the Tories.

Canadian rights to the song in the video are owned by Warner/Chappell Music Canada Ltd. A spokeswoman with Warner head office in New York confirmed that the company contacted the party to discuss its use of the song in the video.

"Warner/Chappell recently sent a letter to the Conservative Party of Canada confirming its unauthorized use of a song written by Warner/Chappell writers," wrote Amanda Collins in an e-mailed statement. "As a regular course of business, we contact parties that use our musical compositions without permission. We look forward to working with the party to resolve this matter quickly."

Conservative party spokes-man Ryan Sparrow declined to discuss the possibility the video violated Warner's intellectual property rights.

"I've checked with our lawyers and our position is that we don't comment on rumours of possible claims against the party."

He said the video produced by the party was not an advertisement.

"The Conservative party has not released any ads containing the music in question," he said.

The video comes as the Tories are preparing to introduce reforms to Canada's copyright laws. The legislation that the government has ready to be tabled is widely expected to be similar to the U.S. Digital Millennium Copyright Act, which is strongly opposed by many culture activists because it emphasizes the ability of copyright holders to control and be remunerated for precisely these sorts of uses of their intellectual property.

A spokesperson for Mr. Prentice said the industry minister was not involved in the production of the video and referred inquiries back to the party.

The substance of the video clip has drawn fire from Liberals, who say it uses quotes from Mr. Dion that are taken far out of context. For example, it presents a clip of Mr. Dion saying "megatonnes of money" as if he were discussing the cost of his own proposals. In fact, the full quote, made in a speech last year, refers to money that Canadian companies could make by being leaders in environmentally friendly technology.

"Yes, Canada will cut megatonnes of emissions, but we will also make megatonnes of money," he told the Economic Club of Toronto.

For the Love of Money was performed by The O'Jays, a Philadelphia-based soul group. It entered the Billboard Top 10 in 1974 and was later heard in two Hollywood films, including New Jack City, according to Warner. Its distinctive chorus -- "money, money, money, money, mo-ney" is today associated with the opening credits of The Apprentice, hosted by New York real estate developer Donald Trump.

Norwegian Police Deal Massive Blow to MPAA Lawyer

Pirate-chasing lawyer Espen Tøndel has been told by the police that they will not spend their valuable resources chasing file-sharers. Undeterred, Tøndel wrote to the Department of Justice demanding a meeting about the police’s decision. They responded all right - and denied him a meeting.

Today, Norway appears to be a much safer country for petty file sharers. The Hollywood lawyer Espen Tøndel has been told by Kripos (serious crime police) that they will not be spending time investigating small-time pirates.

Like many lawyers in the anti-piracy arena, Tøndel tries to blur civil and criminal law to obtain leverage. The police are clear - their priority is investigating real crimes, such as murder and robbery and sadly for him, file-sharing does not fall into those categories. Tøndel must now make his claims against alleged pirates in a civil court.

Following this major setback, Tøndel wrote to the Department of Justice and demanded a meeting with them. He complained that copyright holders need to go through the criminal system as without the help of the police, all they have is an IP address. They cannot sue an IP address, they need a real name and identity.

Unfortunately for Tøndel, the response wasn’t what he’d been hoping for -the Department of Justice completely refused him a meeting- leaving him to start suing IP addresses, which he’s not allowed to do. Ouch.

On Sunday, Trond Giske, Minister of Culture in Norway told VG.no: “We have no plans to do anything similar to the Brits. To identify the users is quite a substantial process, so we plan to focus on only those who upload movies and music illegally. We are cooperating closely with the industry, and are well aware of the money they are loosing because of the illegal downloading.”

Norwegian political commentators are suggesting that Norway’s biggest political party and government, Arbeiderpartiet, aren`t going to change their policy on this because they are afraid of losing votes amongst the 18 to 30 year olds.

So can Norwegian file-sharers feel safe from prosecution now? “No, they can’t. I’m just saying that we will use most of our resources on those who uploads illegally” said Giske in a tone suggesting it’s only serious uploaders who need to take care.

Back in November 2007, Tøndel reported 14 people to the police for sharing the movie, ‘Kill Buljo’, even though the director of the movie didn’t agree with this course of action. I expect there are at least 14 BitTorrent fans smiling today, shortly to be joined by thousands more.

Norway joins Canada in a growing group of common-sense countries which refuse to waste public resources on petty file-sharers. Other countries - such as Germany and the UK are particularly weak. Although they don’t directly involve the police, they allow lawyers to blatantly (ab)use the system by claiming they are prosecuting a criminal case, simply in order to obtain a file-sharer’s identity. They then drop the criminal case, only to pursue a financially lucrative civil one, a tactic favored by lawyers Davenport Lyons to un-mask alleged BitTorrent pirates in the UK.

It’s uncertain at this point if the imminent raids suggested by Tøndel back in October 2007, will become more or less imminent following this statement by the police. Even though the Department of Justice won’t speak to Tøndel, we did, but sadly he doesn’t seem to have a statement for us right now.

Special thanks to RayJoha who made this article possible

News Corp. Working On Music ‘Hulu’ For MySpace
Staci D. Kramer

paidContent has learned that News Corp (NYSE: NWS). is pursuing a music joint venture for MySpace—similar to Hulu, its video joint venture with NBC Universal (NYSE: GE), but with variations on the theme. The constant in both instances is content for equity. Under this scheme, MySpace would be the operator with the major music labels—Universal Music Group, Sony BMG, Warner Music Group (NYSE: WMG), EMI—as content providers and equity partners. MySpace would be a distributer but, like Hulu, the idea would be a mixed portal-distribution experience. Music would be DRM-free and ad supported. No label has signed yet but a source familiar with the situation said that could change in a matter of weeks. The theory is that once one signs on, the rest will follow. (EMI would seem a likely candidate but Sony (NYSE: SNE) BMG already has an interesting deal with MySpace.) That doesn’t always work but, as Amazon (NSDQ: AMZN) has shown, it can.

MySpace, which claims more than 7 million bands with on MySpace Music, has explored and experimented with numerous ways to capture the full value of music to the site, including a recent limited test of ad-supported music downloads. Music has been at the core since the beginning and remains a major driver. Last fall, MySpace and Sony BMG set up a revenue-sharing partnership for sponsorships and ads with the label’s artists’ video and audio content within MySpace.

There are a lot of unanswered questions, to be sure. Among them, international. The future of MySpace relies on global distribution so how this could work globally eventually would be important. That brings in the European Commission and others.

Yahoo: This push continues despite the discussions between News Corp. and Yahoo (NSDQ: YHOO), although the possible combo could give the labels pause. On the other hand, extrapolating the hypothetical, what would Yahoo bring? Yahoo was one of the first to sign on to Hulu and streaming DRM-free music would fit in with its efforts to revamp its strategy.

SXSW 2008 on BitTorrent: 3.5 GB of Free Music

The South by Southwest (SXSW) music festival is one of the biggest and most popular in the United States. For the fourth year in a row, SXSW has released a DRM-less collection of songs that - thanks to Greg Hewgill - can now be downloaded for free via BitTorrent.

SXSW has embraced BitTorrent as a distribution method for showcasing artists since 2005, as they release a large collection of MP3s every year, a few weeks before the festival.

This year, for some reason SXSW decided not to release a torrent showcasing the artists (yet). However, all the mp3s are available for download on the SXSW website. Luckily, Greg Hewgill took the time and effort to put all the MP3s in one big torrent, which makes it much easier to download and share. It’s no OiNK, but it is certainly a good way to discover new artists.

Greg writes: “Since 2005, I have supported the annual South by Southwest music festival by operating a “seed” for the BitTorrent files they have created. From 2005 through 2007, SXSW created the torrents themselves and hosted them on their own tracker. I learned that this year, for whatever reason they won’t be doing that for us.”

“So, I took matters into my own hands and have created a torrent of the 2008 showcasing artists.” Greg adds.

The torrent of the 22nd SXSW edition features MP3s from 764 upcoming, as well as established artists who are scheduled to perform at the festival. In total almost 3.5GB of DRM free music. All the torrents previously released by SXSW are also available for download.

For those who are interested, this year’s SXSW music festival takes place from March 12-16, in Austin Texas.

Pine Record Collector Selling 'History of Music'
Regis Behe

For sale: 3 million record albums and 300,000 CDs; rare and out-of-print titles, all varieties of American music from classical to hip-hop.

But it's much more than vinyl and jewel cases.

"It's the history of music," says Paul Mawhinney, the owner or Record Rama Sound Archives in Pine. "It's my life's work."

Mawhinney, 69, is reluctantly parting with a collection he started more than 40 years ago. Legally blind and fighting diabetes, he wants to spend more time with his five grandchildren.

The collection is worth millions of dollars -- Mawhinney's personal estimate is at least $50 million -- but he has received only one solid offer.

That bid of $28.5 million fell through. Other parties have shown interest, and Mawhinney says he continues to talk to a few interested parties. He has set of goal of selling the collection by March 1.

"I've had a lot of people that wanted it, but they don't have the right kind of capital," he says.

While Mawhinney's albums are a record collector's fantasy, they are beyond the financial reach of most vinyl enthusiasts. That's unfortunate, because there are a lot of desirable items, including:

• An unreleased, untitled Rolling Stones album of early singles. Originally recorded in mono, the songs were remastered in stereo for FM radio stations in the early 1970s. Mawhinney estimates the album is worth between $5,000 and $10,000.

• A rare original copy of Phil Spector's album "A Christmas Gift for You" that features Darlene Love, The Crystals and The Ronettes.

• 15 copies of the first edition of "Elvis' Christmas Album." Mawhinney says the original album, released in 1957, has a red gatefold cover and features Presley singing "Santa Claus Is Back in Town," "Blue Christmas" and 10 other seasonal songs. Estimated worth is $700.

Scott Neuman, president of Recordweb Communications LLC in Lakehurst, N.J., and owner of the online site www.forevervinyl.com, says Mawhinney is spot on with his evaluation of the collection. He agrees the Stones album -- especially if it is unopened -- could be valued at $10,000. "A Christmas Gift for You," in mint condition, could fetch between $700 and $800, and the Presley release might be worth as much as $1,000, Neuman says.

Without having inspected the collection, Neuman believes Mawhinney's estimate of its worth at $50 million "is pretty darn close," he says. "That sounds right."

Optimally, Mawhinney would like the collection to go to a major library or museum, or someplace that will keep it intact. He tried to contact local and national politicians about his dilemma, but he has not received any feedback.

"I can't seem to get any interest from the country in preserving this for history," he says. "I'm very concerned about that."

Put Another File in the Jukebox, Baby
Jason Turbow

IT’S only a mild case of audiophilia, according to the professionals, but it’s causing me significant discomfort.

Until recently I had considered my appreciation of good-sounding music more boon than bane, but the moment my wife and I decided to move, I acquired a harsh new perspective.

I possess a fairly nice stereo (not a problem) and some 2,500 CDs (a significant problem, according to my wife), but the biggest problem is the custom-built cabinet I commissioned to house my music. It sits on an astounding 20 percent of the usable space in our living room. I’m unwilling to subject our new house to that sort of treatment.

I have resisted converting my CDs to the MP3 digital format for two reasons. The thought of feeding discs into my computer, one by excruciating one (I believe this was the ninth labor of Hercules), not to mention organizing it once it is digitized, is painful just to contemplate. More important, I’m entirely unwilling to sacrifice sound quality in return for less clutter.

Recently, however, trends have been working in my favor. Data storage prices are in perpetual free fall — at 50 cents a gigabyte, even giant hard drives are within most budgets — and the FLAC (free lossless audio codec) audio format has gained widespread embrace by mainstream media hardware manufacturers. Like MP3, FLAC is a compression standard for music files, but unlike MP3, it is lossless, meaning it doesn’t degrade sound quality. With it, I could fit 3,000 CDs in a terabyte of storage.

These are details about which my wife does not care. What she is passionate about is floor space. I set about seeing how to help us both.

First stop was Logitech in Mountain View, Calif.

Logitech recently bought Slim Devices, which makes the Squeezebox, a handy little $299 unit about half the size of my desktop keyboard. It relays music from computer to stereo system and then, if the user so wishes, around the rest of the house.

It’s a viable solution, but it still puts me back at my computer, ripping my CDs while I grind my teeth down to the nerve. Even if I outsource the job, with ripping services like Ready to Play (www.readytoplay.com) and Riptopia (www.riptopia.com) that charge about $1.60 or so for each disc, that’s an extra $2,500.

Logitech makes three products — the Squeezebox, the $399 Squeezebox Duet and the $1,999 Transporter — which do more or less the same thing at varying levels of quality.

The first two items are extremely compact. The Duet receiver is just two-thirds the size of the Squeezebox. The Transporter offers a higher quality of sound from a typical size stereo component. All three connect wirelessly to the server — in most cases, a computer — and must be run through an amplifier or powered speakers.

A similar wireless audio-streaming device is the Zone Player 100 ($499) from Sonos, based in Santa Barbara, Calif. Unlike the Logitech devices, it has an integrated amplifier, so all one needs is an audio source and a pair of speakers. For those who prefer to power their music through an existing stereo system, the Zone Player 80 ($349) is an amp-free alternative. Each unit is commanded through a feature-laden remote control ($399), complete with scroll wheel and full-color screen.

While Sonos does a capable job of retrieving one’s own stored music, the company is banking on users obtaining music online, both from services like Rhapsody and Napster — which are essentially fee-based online jukeboxes — and Internet radio.

But I did not build a CD collection just to ignore it. More exploration was in order. Second stop was the high-end test drive.

There is little argument that McIntosh makes among the best — and most expensive — audio components. So when the company came out with the MS750 last year, my ears perked up. Knowing much of the $6,000 price tag was going toward a level of sound quality that may well be lost on my good-but-not-great stereo system, I proceeded with caution.

From an ease-of-use standpoint, the McIntosh was exactly what I was looking for. A simple interface allows for automatic CD ripping (into FLAC or a variety of other formats) in about four minutes.

“I have people write in all the time and say, ‘You know, I could do the same thing with a $400 computer and this program or that program,’ ” said Ron Cornelius, a McIntosh project manager. “And they’re absolutely right — they can. But try to use it every day. If you’re not a computer geek, forget it. It’s just not a friendly portal.”

The MS750 is named for its 750-gig hard drive, big by most measures but still only enough to handle about two-thirds of my music in FLAC format. And this is where my dreams of a McIntosh began to evaporate. I could buy another MS750, the pair connecting wirelessly as if they were a single machine.

Clearing a $6,000 piece of machinery with my wife will be tough enough; doubling that price tag would be akin to asking for a divorce. The fact that the MS750 needs a video screen to use its navigation fully — it can be run through a TV or a laptop, but I would more realistically have to buy a devoted L.C.D. screen — adds to the cost.

Third stop was Olive Media Products, San Francisco.

At first blush, Olive’s product line is not dissimilar from the McIntosh — internal hard drives, easy ripping of CDs and high-end circuitry. Like the others, Olive’s highest-capacity machine, the Opus N°5, comes with a 750-gig drive. Unlike the others, however, it has a U.S.B. 2.0 port with which to attach an external hard drive, letting users more than double its capacity for less than $200. Why doesn’t every system have this?

Additionally, the front-panel display is fully navigable, without need for an additional screen. The Opus connects to the Internet, allowing not only for online radio, but giving users remote control once its included software is installed on a touch-screen P.D.A.

The main downside is that Olive does not offer a device to deliver music into additional rooms, though industry whispers hint that could change within the year. Perhaps the biggest bonus is that Olive will rip my CDs for me. The first 300 are included in the price of the machine, and the rest can be done for as little as 50 cents each. I can send my CDs to Olive and the machine I order will be delivered with my music already on it.

If there’s anything closer to my pipe dream, I can’t imagine what it is. With the Opus N°5 priced at $3,999, even if I choose to outsource my ripping I can still be home free at just over $5,000.

Seems like a small price to pay for a happy marriage and a bigger living room.

TVT Records Set To File Chapter 11

Independent label TVT Records is set to file for Chapter 11 bankruptcy and according to reports, has let go of the majority of the label's staff. TVT has been more Hip-Hop oriented as of late and is currently the label home of Lil Jon & The Eastside Boyz, Ying Yang Twins and Pitbull, as well as indie rock choir The Polyphonic Spree.

TVT was founded by its President, Steve Gottlieb, in 1985 and has released everything from compilations of TV theme songs to Nine Inch Nails' landmark debut record, Pretty Hate Machine.

It is unknown how the bankruptcy filing will affect TVT Music Publishing or any upcoming TVT releases, including Lil Jon's long-in-the-works record Crunk Rock. According to AllHipHop.com, rapper Pitbull recently spoke out against the label, saying, "I'm out here working like a slave, doing things that other artists don't even know how to do. A label's there to further and promote your career, but it feels like they just keep holding me back."

Make Big Profits Illegally (and Maybe Keep Them, Too)
Floyd Norris

There is not much doubt that Oleksandr Dorozhko used inside information when he made a killing trading stock options last fall. Nor is there a dispute that he gained the information illegally. His lawyer, arguing before an appeals court this week, spoke of “a high-tech lock pick.”

But that does not mean that Mr. Dorozhko, a Ukrainian resident, will have to forfeit the $296,456 he earned in one day of trading, beginning just hours before the company in question announced disappointing earnings. The Securities and Exchange Commission blocked him from collecting the profits from his brokerage account, but a federal judge has ordered the S.E.C. to let him have the cash.

The hearing this week, before the United States Court of Appeals for the Second Circuit, in New York, was on the S.E.C.’s request for an emergency order to keep the money frozen. If the commission loses, the case against Mr. Dorozhko will effectively be over. Even if the S.E.C. later won the case, the chances of collecting a judgment in Ukraine would be slim at best.

This situation exists because of a strange anomaly in American securities laws. A person who legally obtains insider information — as a corporate official or an investment banker, for example — will almost certainly break the securities law if he or she trades on the basis of that information before it is made public.

But it is far less clear that someone who illegally gets their hands on such information will have violated the securities laws by trading on it. The securities law used to bring insider trading charges — Section 10(b) of the 1934 Securities Exchange Act — talks of “a deceptive device or contrivance,” and it is not clear that there is any deception involved in simple theft.

“Dorozhko’s alleged ‘stealing and trading’ or ‘hacking and trading’ does not amount to a violation” of securities laws, Judge Naomi Reice Buchwald of United States District Court ruled last month. Although he may have broken laws by stealing the information, the judge concluded, “Dorozhko did not breach any fiduciary or similar duty ‘in connection with’ the purchase or sale of a security.” She ordered the S.E.C. to let him have his profits.

She refused to dismiss the case, saying the S.E.C. could try to prove he got a tip from an insider, but there does not appear to be any evidence of that. Instead, the evidence indicates that on Oct. 17, 2007, someone hacked into a computer system that had information on an earnings announcement to be made by IMS Health a few hours later.

Minutes after the breach of computer security, Mr. Dorozhko invested $41,671 in put options that would expire worthless three days later unless IMS shares plunged before that. The next morning the share price did plunge, and Mr. Dorozhko made his money by selling the puts.

The S.E.C. argues there was deception involved in hacking into the computer system, which was designed to allow access only to authorized people.

That view drew scorn from Charles A. Ross, Mr. Dorozhko’s lawyer, at the appellate hearing Wednesday. “They want you to believe there is a deception of a computer,” he said. “All there is is a high-tech lock pick.”

That argument seemed to draw some sympathy from one of the three judges hearing the appeal. “You deceived a machine,” said Judge Sonia Sotomayor, invoking the image of Big Brother from George Orwell’s novel, “1984.” “We are treating a machine as a person.”

Judge Buchwald’s ruling was the first one to address the S.E.C.’s theory of deception by hacking from overseas. Two previous cases were filed, but one was settled and in the other the defendants chose to forfeit $1.6 million rather than fight the charges. If her opinion stands, it will be very hard for the commission to go after hackers in the future.

The judge appreciated the absurdity of the situation, and expressed disappointment that the Justice Department had not brought criminal charges for computer hacking. The government has offered no explanation for that, but it is possible the department saw no likelihood of ever being able to arrest Mr. Dorozhko, and did not think the case worth the trouble.

The judge also noted that case law could have developed differently, harking back to Justice Harry Blackmun’s dissent to the Supreme Court’s 1980 decision that reversed the insider trading conviction of Vincent Chiarella, a financial printer who learned of takeover targets from his work and traded on the information. The court, Justice Blackmun wrote then, was moving in a direction “that catches relatively little of the misbehavior that all too often makes investment in securities a needlessly risky business for the uninitiated investor.”

Donald Langevoort, a law professor at Georgetown University and the author of a treatise on insider trading law, said in an interview that he thought the S.E.C. should prevail in the case. “Did he commit fraud? Yes,” Mr. Langevoort said. “Was it for the purpose of obtaining a trading advantage? Yes. Why should that not reach the level of the statute?”

The appeals court will decide soon if the asset freeze stands, but a ruling on whether Judge Buchwald correctly interpreted the law, if it comes at all, is many months away. She would first have to dismiss the case.

In the meantime, Congress could clear all this up with a simple amendment to clarify the law. “The European Union revised their insider trading laws to make it clear that any gaining of inside information by criminal activity would be a violation of insider trading laws,” Mr. Langevoort said.

As Chief Justice Warren Burger wrote in his dissent in the Chiarella case, “A person who has misappropriated nonpublic information has an absolute duty to disclose that information or to refrain from trading.” If it is illegal to trade on information acquired legally, why should it be legal to trade on information that was acquired illegally?

International Hacking Network Busted, Quebec Police Say

Computers in Manitoba, the United States, Poland and Brazil targeted in scam
CBC News

Quebec provincial police say they've dismantled a computer hacking network that targeted unprotected personal computers around the world.

Police raided several homes across Quebec on Wednesday and arrested 16 people in their investigation, which they say uncovered the largest hacking scam in Canadian history.

The hackers collaborated online to attack and take control of as many as one million computers around the world that were not equipped with anti-virus software or firewalls, said provincial police captain Frederick Gaudreau.

"That way, they were able to introduce some Trojans or worms in those computers, and that way they were able to take control of the computers from abroad," he said at a Montreal news conference on Wednesday.

The majority of computers attacked by the network were in Poland and Brazil, but some PCs in Manitoba and the United States were also hacked, he said.

Several government computers were also compromised, but investigators will not say in which country.

The computers were used to set up fake websites that solicited users to click on them and provide personal information, Gaudreau said.

Police won't reveal what the information was used for but investigators estimate that the network profited by as much as $45 million.

The 14 suspects arrested Wednesday are between the ages of 17 and 26, and face charges related to the unauthorized use of computers.

Hackers Exploiting Facebook, MySpace Plug-ins
Brian Krebs

If you use Internet Explorer (versions 6 or 7) to browse the Web, listen up: Criminals are starting to exploit security holes in several widely installed IE plug-ins to plant invasive software when users are coerced or tricked into visiting one of several Web sites.

In an alert posted Friday evening, security software vendor Symantec said it is seeing malicious Web sites popping up trying to exploit vulnerabilities in a set of ActiveX controls produced by Aurigma, a technology company whose image transfer browser plug-in is licensed and distributed by a number of major Web sites to help IE users upload pictures. Currently, Facebook.com and MySpace.com are among the biggest distributors of this ActiveX plug-in, but they are hardly the only ones.

Symantec warns that if visitors don't have the Aurigma plug-ins installed, the sites will probe for other vulnerable IE plug-ins, including two recently discovered from Yahoo! and one for QuickTime (this one attacks a vulnerability Apple patched just last month). The sites also throw in an exploit against a six-month-old IE flaw.

The malicious Web sites identified by Symantec actually redirect visitors to a fake MySpace.com login page in an attempt to steal MySpace credentials, all while trying the various plug-in exploits quietly in the background. The URL used by this site would probably fool all but the most vigilant (see the included screenshot).

The sites all download a series of executable programs, including some that Symantec said appear to be placeholders for whatever nasties the bad guys want to stuff in there later. The company said it is still in the process of analyzing the programs to see what they do, but it's doubtful they will turn out to be harmless.

If you haven't checked out the free, easy-to-use fixit tool released by incident handlers at the SANS Internet Storm Center, please do so now. The simple, graphical program sets a marker in the Windows registry so that if the vulnerable ActiveX components are installed, then the operating system will not let anyone or anything make use or activate those components.

To use the tool, double click on the .exe file that you download from SANS (you will need to run this while logged in as "administrator"). In the program window that pops up, place check marks in all of the boxes, then hit the "set" button. The notation next to each entry should now read "CLSID Exists." Click the "x" in the upper right corner of the box. You're done. If you ever want to undo any part of what you just did, run the tool again and uncheck the relevant boxes and hit "set."

Computer Programmer's Attorneys Use 'Geek Defense'

On trial for murder, man being portrayed as eccentric, difficult
Karl Vick

When Nina Reiser disappeared in September 2006, investigators suspecting foul play looked long and hard at her estranged husband, the computer genius Hans. Eccentric, awkward and notoriously difficult as a human being, Hans Reiser proved quite accommodating when it came to providing clues.

After taking no part in the massive public effort to search for the mother of his two children, he listed the reasons he was happy that Nina was gone in a phone call monitored by police. He discreetly purchased copies of "Masterpieces of Murder" and "Homicide" from a local bookstore. Police discovered his passport in his fanny pack along with $8,000 in cash and a cellphone that could not be tracked electronically because its battery was removed, just like the phone found inside Nina's minivan, which was found abandoned on a side street smelling of rotting groceries; she had been to the store before dropping the kids at Hans's house.

Police also found soaked floorboards in his car and an empty space where the passenger seat should have been.

In the courtroom where Hans Reiser is on trial for murder, all this might appear to indicate guilty knowledge. But his attorneys cast it as evidence of an innocence peculiar to Hans, a computer programmer so immersed in the folds of his own intellect that he had no idea how complicit he was making himself appear.

"Being too intelligent can be a sort of curse," defense counsel William Du Bois said. "All this weird conduct can be explained by him, but he's the only one who can do it. People who are commonly known as computer geeks are so into the field."

And so this week, after a prosecution case that took almost three months, Du Bois launched what Wired magazine dubbed "the Geek Defense." In court, Du Bois has taken pains to portray his client as an irritating nebbish. He has repeatedly asked Alameda County Circuit Court Judge Larry Goodman to order his client to stop distracting him by talking in his ear at the defense table. He called Reiser "an inconsiderate slob" in front of the jury.

"We're leaving the right message," Du Bois said outside court. "He's a very difficult person. It's very difficult to represent a genius."

The effort will be watched and appreciated down the breadth of Silicon Valley, perhaps the only place a computer genius might find a jury of peers.

There, Hans Reiser's actions appear fairly reasonable, at least to people who spend much more time with computer code than with other humans.

"It strikes me that a lot of coders have a somewhat detached view of the world, and it's reasonable to assume that Hans might not even have stopped to think about how things looked," said Rick Moen, a local area network consultant in Menlo Park.

"I remove my cellphone battery periodically, and I've taught many people to do the same," noted John Gilmore, a founder of the Electronic Frontier Foundation, which is challenging the Bush administration in court on wiretaps. "What can you do when the FCC mandates tracking capability to every cellphone? On the lame excuse that once in a while someone calls 911 and can't give the address."

On his LinuxMafia site, Moen maintains a timeline of the case culled from the posts filed from correspondents in the courthouse gallery 35 miles north, live-blogging the trial for the San Francisco Chronicle and Wired's Threat Level blog.

"I met Hans a couple of times socially, and he did not strike me as being all that peculiar for a technical person," Moen said. "A little bit intense, a bit highly focused. Quite bright."

Now 44, Reiser was accepted at the University of California at Berkeley at age 14. He wrote a role-playing game to compete with Dungeons & Dragons and dabbled in science fiction. His signal adult achievement was ReiserFS, a file system he named for himself, unusual in the programming world. The system organizes data on Linux, the "open source" operating system.

After opening a company in Russia, he met Nina Sharanova, a striking obstetrician-gynecologist using a dating service to meet foreigners. They married when she became pregnant, but after the second child was born in 2001, Nina began an affair with Hans's best friend, Sean Sturgeon. The cross-dressing bondage and discipline enthusiast had been "maid of honor" at their wedding.

The ensuing divorce was ugly. Hans accused Nina of Munchausen Syndrome by Proxy, saying she made their son ill for her own gratification. Nina complained of Hans's avowed enthusiasm for violent video games, which he encouraged the boy to play as a rite of passage. Relations were so brittle that a police officer seeing them exchange the children one day advised Nina to "get a gun."

She was last seen at Hans's house, where she was dropping off the children for Labor Day weekend 2006. She was 31 then.

"His undergraduate thesis is on how if you change the perspective, the reality is different," said Ramon Reiser, the defendant's mathematician father, folding a pair of pants in the courtroom hallway as he waited to testify.

The thesis might apply to the evidence, which the judge in the preliminary hearing termed thin. Ramon Reiser argued that it's likelier that Nina is back in her native Russia with funds embezzled from her husband's business than in an unmarked grave she was carried to in the soaked, seatless Honda CR-X. The children are with Nina's mother in St. Petersburg.

"When you look at it, would Hans Reiser turn a hose on a car to wash it? Absolutely, his mother told him to get that car cleaned up," the elder Reiser said.

"I and my brother -- maybe it's genetic -- have driven our cars without the front seat. It's really convenient."

If Hans Reiser testifies in his own defense, his attorney said the risk is that "this guy is so weird, it's a little tricky to wrap yourself around it if you're a juror." He described his client as borderline for Asperger's Syndrome, a condition that self-described geeks call unusually common in the computer industry, combining as it does an exceptional ability to focus with an inability to read social cues.

Gilmore added that the unforgiving nature of computers demands of coders "a perfectionism that makes it hard sometimes in social situations. When I see something that's a little bit wrong, and I ought to just shut up and roll with it, but I comment and it causes trouble with the people around me. Back-seat driving and that sort of thing."

Yet not all the strangeness in the case arises from computers. Du Bois takes every opportunity to mention Sturgeon, who in addition to his role as Hans's friend and Nina's lover, told investigators that he killed eight people years ago. It's unclear whether the claim is true: Sturgeon remains free. But the judge forbade attorneys from mentioning the claim in court.

In any event, Sturgeon reportedly has insisted that whatever his crimes, he had nothing to do with Nina's disappearance. Wired quoted him as saying that, in the Reiser case, he is red herring, or rather, he said, "a red Sturgeon."

Trend Micro 2008 Forecast for Cybercrime.
Press release

Increasing trend in underlying criminality for financial gain in the area of cybercrime set to continue throughout 2008.

According to research from Trend Micro’s TrendLabsSM, hackers are intensifying their attacks on legitimate Web sites. It debunks the adage to “not visit questionable sites” – just because a user visits a gambling or adult-content site doesn’t necessarily mean Web threats are lurking in the shadows; the site with the latest sports news or links in a search engine result, however, could potentially infect visitors with malware.

An underground malware industry has carved itself a thriving market by exploiting the trust and confidence of Web users. The Russian Business Network, for example, was notorious all year for hosting illegal businesses including child pornography, phishing and malware distribution sites. This underground industry excludes no one. In 2007, Apple had to contend with the ZLOB gang, proving that even alternative operating systems are not safe havens for the online user. The Italian Gromozon, a malware disguised in the form of a rogue anti-spyware security application, also made its mark in 2007.

This past year, the NUWAR (Storm) botnet expanded in scope when Trend Micro researchers found proof that the Storm botnet is renting its services to host fly-by-night online pharmacies, dabble in stock pump-and-dump scams, and even portions of its backend botnet infrastructure. During 2007, the most popular communication protocol among botnet owners was still Internet Relay Chat possibly because software to create IRC bots is widely available and easily implemented and at the same time movement to encrypted P2P is being used and tested in the field.

Security threats are no longer limited to PCs. Mobile devices, as they become more sophisticated and powerful, are at risk for the same types of threats as PCs (viruses, spam, Trojans, malware, etc.) Gadgets with wireless capabilities such as Wi-Fi and Bluetooth, as well as storage capability have become major sources of data leaks, as well as carriers of infections through security perimeters.

Other notable findings from the report:.

- The Windows Animated Cursor exploit (EXPL_ANICMOO) encompassed over 50 percent of all exploit codes to hit the Internet computing population. 74 percent of its infections this year came from Asia. The same holds true for TROJ_ANICMOO.AX, a related threat which embedded the exploit. 64 percent of computers infected with this were from China.

- The top malware finding was WORM_SPYBOT.IS and WORM_GAOBOT.DF. Both created botnets and worms that infected USB-connected devices.

- Nearly 50 percent of all threat infections come from North America, but Asian countries are also experiencing a growth -- 40 percent of infections stem from that region.

-Social networking communities and user-created content such as blog sites became infection vectors due to attacks on their underlying Web 2.0 technologies, particularly cross-site scripting and streaming technologies.

- Infection volumes nearly quadrupled between September and November 2007, indicating that malware authors took advantage of the holiday seasons as an opportunity to send spam or deploy spyware while users are shopping online.

- In 2007, the number one online commerce site attacked by phishers was still global auction site eBay and sister company PayPal. Financial institutions, especially those based in North America, also experienced a high volume of phising attacks.

Based on the emerging trends of this year, the following are Trend Micro’s forecasts for the threat landscape in 2008:

1. Legacy code used in operating systems and vulnerabilities in popular applications will continue to be attacked in the effort to inject in-process malicious code that criminals can exploit to run malware in efforts to breach computer and network security in the efforts to steal confidential and proprietary information.

2. High-profile Web sites that run the gamut of social networking, banking/financial, online gaming, search engine, travel, commercial ticketing, local government sectors, news, job, blogging, and e-commerce sites for auction and shopping will continue to be the most sought-after attack vectors by criminals to host links to phishing and identity theft code.

3. Unmanaged devices such as smart phones, mp3 players, digital frames, thumb drives, and gaming stations will continue to provide opportunities for criminals and malware to infiltrate a company’s security borders due to their capabilities for storage, computing, and Wi-Fi. Public access points such as those in coffee shops, bookstores, hotel lobbies, and airports will continue to be distribution points for malware or attack vectors used by malicious entities.

4. Communication services such as email, instant messaging, as well as file sharing will continue to be abused by content threats such as image spam, malicious URLs, and attachments via targeted and localised socially engineered themes due to their effectiveness in luring potential victims as criminals attempt to increase the size of botnets and steal confidential information.

5. Data protection and software security strategies will become standard in the commercial software lifecycle due to the increasing high-profile incidents. This will also put a focus on data encryption technologies during storage and transit particularly in the vetting of data access in the information and distribution chain.

Lawmakers Move to Grant Banks Immunity Against Patent Lawsuit
Jeffrey H. Birnbaum

Sen. Jeff Sessions (R-Ala.) has sponsored an unusual provision at the urging of the nation's banks granting them immunity against an active patent lawsuit, potentially saving them billions of dollars.

Adopted with little fanfare, the amendment would prevent a small Texas company called DataTreasury from collecting damages from banks for infringing on its patented method for digitally scanning, sending and archiving checks. The patents were upheld last summer by the U.S. Patent and Trademark Office after they were challenged.

The provision, passed without dissent by the Senate Judiciary Committee in July and inserted into legislation scheduled for a vote by the full Senate this month, is a rare attempt by Congress to intervene in ongoing litigation, congressional experts say.

Although the amendment would not invalidate DataTreasury's patents, it would spare the banks from paying for infringing them should courts decide that's warranted. If DataTreasury collected a royalty of just a couple pennies per check, the cost would run into billions of dollars.

The federal government would have to pay $1 billion to DataTreasury over 10 years as compensation for taking its property under the amendment, according to estimates by the Congressional Budget Office.

Banks process more than 40 billion checks each year. At one time, those checks had to be delivered physically to be drawn upon. But five years ago -- in the wake of the grounding of aircraft laden with billions of dollars in checks after the Sept. 11, 2001, attacks -- federal law was changed to allow electronic transfers as well.

Some major financial institutions, notably Merrill Lynch and J.P. Morgan Chase, have licensed DataTreasury's technology for the purpose. Lawsuits alleging infringement are pending against others, including Bank of America, Wells Fargo, Wachovia and Citigroup.

When the Judiciary Committee began to draft landmark legislation overhauling the country's patent laws last year, lobbyists for these banks jumped into action.

The Financial Services Roundtable, a lobby group that represents the nation's largest financial institutions, and the banks approached Sessions about sponsoring an amendment to protect them. They said they chose to work with Sessions because of his long-standing antipathy toward plaintiff's attorneys and his previous interest in the electronic check system.

Lobbyists for the Roundtable and the banks, including prominent free-lance lobbying firms Smith-Free Group, Bryan Cave Strategies and Quadripoint Strategies, conducted rush visits with Judiciary Committee members and their aides to advocate the measure. Sessions's staff produced a three-page description of the amendment and its background with the help of the Roundtable and distributed it to the committee.

Commercial banks are considered a potent force on Capitol Hill, in part because of their heavy contributions to lawmakers. They are the 10th-largest donor to federal candidates among the industry groups followed by the Center for Responsive Politics. They also spend millions of dollars a year on lobbying.

Political action committees of financial institutions were the largest single category of industry donors to Sessions, with $52,300 in the current election cycle, the center said. That represented nearly a quarter of PAC contributions he received as of midyear 2007.

Sessions said the banks' support for him was not a factor in his decision to sponsor the amendment. Stephen Boyd, a spokesman for Sessions, said the provision "is designed to protect banking institutions complying with post-9/11 security requirements from the abusive practices of patent trolling trial lawyers seeking personal enrichment, which ultimately will be paid for by checking account customers across America."

In addition, bank lobbyists say they are working with senators to alter the amendment so that it would not cost the government money.

The provision introduced by Sessions did not name DataTreasury but was carefully tailored to apply to that company and its "check collection" system.

The amendment was approved by the committee in minutes and without opposition. The measure received little news media attention outside the banking trade press.

Even Claudio Ballard, the founder of DataTreasury, which holds the patents, said he did not hear of the amendment until days afterward. He said he had been unaware that the Judiciary Committee was considering it and engaged lobbyists to help him only after it had passed. Ballard did not know whom to turn to for help, so he relied on his law firm, Nix, Patterson & Roach, which recommended two prominent Washington lobbyists: John D. Raffaelli and Ben Barnes.

"I've always put my full faith in the courts and the patent office; that's all I thought I needed to do," Ballard said. "But we were blindsided" by the Senate committee.

"We had no notice, no opportunity to respond, to give our side of the case, nothing," he said.

The banks allege that DataTreasury bought up patents for the system that underlies electronic transfers and is trying to shake down companies for licensing fees. But DataTreasury asserts that Ballard is the inventor of the system and built a company to sell it before being squashed by banks that stole his idea. Court battles have raged between the two sides for six years.

The banks are emphatic about the need for the protection. "This is a glaring example of the abuse of the system," said former congressman Steve Bartlett (R-Tex.), president of the Financial Services Roundtable. "It's an example of what's wrong with patent law."

He called the Sessions amendment a priority for the banking industry.

The Commerce Department has objected to the amendment, including in a letter last week to Sen. Patrick J. Leahy (D-Vt.), the Judiciary Committee chairman. "Limiting patent holders' rights and remedies in this instance could reduce innovation in this technology area," wrote Assistant Secretary Nathaniel F. Wienecke. "The Administration does not support exceptions to patent protection based on a particular technology."

DataTreasury's patents were upheld by the patent office after a challenge by First Data, a provider of merchant processing services. The patent office concluded Ballard's patents were not predated by other patents and documents, as First Data had alleged.
Ballard asserts that he developed the basic architecture for the system in the mid-1990s, and applied for patents in 1997 and '98. He said he realized at the time that paper would one day be obsolete for financial transactions but that paper and electronic images would have to coexist for a while. His system helped make that possible, he said.

Ballard has a long history of working with databases. He was an early reseller of Oracle database products in the 1980s and later developed a method of adapting Oracle's software to complex computer applications for government and large corporations.

He said he talked to some bank officials at an early stage of the check system's development and, despite having signed nondisclosure agreements with them, soon lost control over his invention.

"We've struggled mightily," Ballard said. "We almost went bankrupt at the end of 2001." He said he brought in investors to remain afloat and, as a result, now owns 2 percent of the firm he founded. The company, located in the technology corridor near Plano, Tex., once had 100 employees, he said. It now has two.

Patent Suits Target Operators, Broadcasters

Rembrandt’s choreographed litigation aims to paint green results
Todd Spangler

A suburban Philadelphia firm whose sole business is to buy up technology patents is trying to force large cable operators and major broadcasters to pay substantial license fees on the transmission of digital TV signals and Internet services.

If successful, the firm, Rembrandt IP Management, could pull in big money from the enforcement of patents related to the cable industry’s standard for connecting customers to the Internet and potentially throw a financial monkey wrench into the broadcast industry’s mandate to transmit all TV signals in digital form by a year from now.

In the worst-case scenario, Rembrandt’s litigation may undermine the ability of industry bodies to set technical standards whose uses are meant to be widely available for “fair and reasonable” patent-licensing fees.

In cases originally spread across federal courts in Delaware, New York and Texas, Comcast, Time Warner Cable, Charter Communications, Cox Communications and Cablevision Systems face claims that their cable-modem services infringe eight patents now held by Rembrandt, and that their video services violate a ninth one related to digital-TV transmission.

Separately, ABC, CBS, NBC Universal and Fox — as well as manufacturer Sharp Electronics — face suits alleging infringement of Rembrandt’s patent on digital TV transmission.

Rembrandt is hoping to win hundreds of millions of dollars from the suits, which have been previously reported by Forbes, EE Times and others.

According to an attorney close to the litigation, the firm has sought to collect half of 1% of all revenue generated from services that allegedly infringe on the data and video patents.

From the broadcasters, that could start at $90 million per year or more. Beginning Feb. 18, 2009, all over-the-air TV programming will be transmitted in digital form. And, in 2006, broadcasters took in $18 billion in advertising on the shows they sent to company-owned and affiliated stations, according to PricewaterhouseCoopers.

The impact could also be huge for cable operators, which provide broadband service to an estimated 36 million customers and retransmit digital TV signals from local TV stations.

For example, a half-percent cut of Comcast’s 2007 data revenue alone would have totaled $32 million, according to Multichannel News’ calculations.

Patent litigation is nothing new. Claims of infringement are regularly lobbed against big companies by “patent trolls,” a scornful term for companies that do not produce products or services, but acquire intellectual property and make money from other people’s inventions.

Rembrandt, however, has embarked on an especially sweeping assault. It is attacking two key technology standards used by the cable and broadcast industries, CableLabs’ DOCSIS and the Advanced Television Systems Committee’s digital-TV spec.

“If they’re successful, this could affect everything from the cost of cable service to the price of TVs,” said the attorney close to the litigation, who spoke only on condition of anonymity.

There’s cause for concern: Rembrandt won its first significant legal victory earlier this month. A federal jury in Marshall, Texas, on Feb. 6 awarded Rembrandt $41 million after finding Novartis’ Ciba Vision eye-care unit had infringed on a patent — bought by Rembrandt — covering a treatment for contact-lens surfaces. Ciba Vision spokeswoman Amanda Cancel noted there has been no court order and declined to comment “on pending litigation.”

Representatives for the cable companies, broadcasters and technology manufacturers involved in the cases, as well as CableLabs, declined to comment for this story.

When Multichannel News requested an interview, Rembrandt executive vice president Barry Ungar replied in an e-mail: “Sorry, but I’m really swamped.”

But Ungar told Forbes magazine, regarding the Ciba judgment: “We are really gratified about the verdict. The jury verdict validates our business model.”

The firm, bankrolled by hedge funds to the tune of $150 million, has bought up more than 200 patents.

Rembrandt was founded in 2004 by CEO Paul Schneck, a former NASA engineer described by his company as “an internationally accomplished scientist.” The firm’s site says it offers “ample funding to pursue exploitation and licensing of intellectual property for companies and inventors that require solid resources.”

Since Rembrandt filed its original suits, equipment manufacturers have turned the tables on the patent litigator with legal actions of their own, as the targeted operators and broadcast networks requested indemnification protection from their vendors.

On the cable front, Motorola, Cisco Systems, Arris, Thomson, Ambit Microsystems and Netgear filed a complaint last November for declaratory judgment against Rembrandt, asking a federal court to affirm that their cable-modem products don’t infringe on the patents in question. They also assert that the patents are invalid, anyway.

“Rembrandt did not invent the technology in the patents,” the vendors said in their suit. “Rembrandt also did not invent DOCSIS or contribute to the development of DOCSIS.”

The suit is pending in Delaware’s federal district court, where a federal court panel consolidated the other Rembrandt cable and broadcast cases.

Digital broadcast-equipment vendor Harris, meanwhile, is fighting Rembrandt in Delaware state court in relation to its broadcast customers’ use of its ATSC-based gear.

When Harris approached the firm about licensing the patent, according to court documents, Rembrandt refused to provide fair, reasonable and nondiscriminatory (FRAND) licensing terms.

To Harris, that represents a breach of contract, because AT&T — the previous owner of the ATSC-related patent — in 1995 agreed to license intellectual property on FRAND terms to anyone employing the digital TV spec.

Rembrandt in December 2004 acquired that patent, along with others allegedly pertaining to DOCSIS, for a reported $1 million from communications-equipment maker Paradyne. Paradyne, once owned by AT&T, is now part of Zhone Technologies.

A win by Rembrandt in these cases could force manufacturers to pony up hefty fees for any ATSC-based and DOCSIS gear. Or, the firm’s victories could force anyone using the patented technology in the actual transmission of a digital-TV signal (the broadcasters) or redistribution of the signal (cable operators) to pay fees as well.

But, if Rembrandt’s trolling gets court support, the result would inflict serious problems on companies in any industry which relies on technology standards, according to the lawyer involved in the proceedings.

“If Rembrandt is allowed to succeed with their position,” the lawyer said, “the commitments people make to standards bodies become worthless.”

To date, no court has ruled for or against Rembrandt in any of its numerous suits involving the cable-modem and digital TV patents.

AT&T, TW, Verizon Make Case Against Net Neutrality
Chloe Albanesius

Regulation intended to ensure net neutrality will actually kill Internet innovation and crush an industry that has operated effectively through market forces alone, according to major telecom companies like AT&T, Verizon and Time Warner Cable.

Net neutrality advocates have asked the Federal Communications Commission (FCC) to "medicate the Internet with a preemptive cocktail of experimental regulatory tonics," lawyers for AT&T wrote in an FCC filing.

"Internet regulation proponents have asked that the commission wade into a competitive marketplace driven by a fierce pace of technological innovation and pick winners and losers by regulatory fiat," added attorneys for Qwest Communications.

At the request of Free Press, the FCC is investigating whether "degrading peer-to-peer traffic" violates FCC rules for reasonable network management. The move comes after an Associated Press article and subsequent Electronic Frontier Foundation (EFF) test last year concluded that Comcast was blocking user access to peer-to-peer networks. Comcast admitted to delaying traffic during peak hours, but denied blocking P2P applications completely.

The FCC is also examining a petition from file-sharing company Vuze that asks for clarification on what constitutes "reasonable network management."

Telecoms like AT&T and Qwest submitted their comments on February 13, the last day the FCC was accepting public comments on the matter.

AT&T took aim at Google, which has sided with Free Press and Vuze on the issue. Google and Amazon last week issued their support for a net neutrality bill that would require the FCC to examine how Internet service providers manage their networks.

"It would be wholly arbitrary to regulate Comcast's purported 'traffic shaping' but not the content-shaping practices of Google within the search and online advertising markets it monopolizes," AT&T wrote.

Free Press complained that only Comcast knows the algorithm they use to shape traffic within Comcast's network. "But Free Press might just have easily been complaining about Google, which alone knows the secret algorithms it uses to order its search results," AT&T said.

None of the companies would address the accusations against Comcast directly, but they all supported the company's attempt at network management.

"Internet backbone service providers have no economic incentive to engage in the traffic management practices that Vuze fears [because] backbone service providers are fully compensated for the use of their network by their direct customers," according to the Global Crossing filing.

"Broadband providers must retain the flexibility to employ traffic management practices to protect their networks," Time Warner Cable's filing said.

The FCC should not expect telecom companies to publicly share its network management secrets, AT&T insisted. "There is no surer way to compromise the integrity of a given network than broadcasting the technical details of how that network is managed," the company said.

AT&T and Verizon have emerged recently as competitors to Comcast, as both phone providers have moved into the video space. Nonetheless, both companies came to Comcast's defense.

Network management is "appropriate and necessary," Verizon wrote in its filing.

Free Press and Vuze ignore the fact that network management is key to stopping threats like viruses and spam, Verizon wrote.

These issues are "best left to network engineers who must respond to real world concerns" and not regulatory agencies like the FCC, Verizon said.

The lone dissenter among providers was Vonage. Given that Vonage's service rides on cable and telecom carriers' services, Vonage is "critically interested in ensuring that its competitors do not use 'reasonable network management' as a pretext to degrade the performance of Vonage's service," the company wrote.

Vonage expressed concern that unchecked network management might impede its customers' ability to access 911 service. It called on the FCC to make sure access to emergency services was guaranteed.

Four years ago, the FCC mandated that VoIP providers like Vonage provide access to 911 after several unfortunate incidents with VoIP customers who were unaware that their Internet-based phone service did not connect to emergency services.

BitTorrent Busts Comcast BitTorrent Busting

As Comcast ignores reality
Cade Metz

Unhappy that Comcast is busting BitTorrents, BitTorrent has decided to bust this BitTorrent busting.

On Friday, as reported by TorrentFreak, a quartet of BitTorrent developers - including three staffers at BitTorrent Inc. - proposed a new extension to the popular P2P protocol that would circumvent Comcast's self-described "reasonable network management."
Last May, an independent researcher named Robb Topolski revealed that the big-name American ISP is preventing users from "seeding" BitTorrents and other P2P files. When one machine finishes downloading a file and promptly attempts to upload that file to another machine, Comcast sends out a duped "reset flag" that breaks this peer-to-peer connection.

The proposed BitTorrent extension would use encryption, or "obfuscation," to keep Comcast from pulling this trick. "The goal is to prevent internet service providers and other network administrators from blocking or disrupting BitTorrent traffic connections," the proposal reads.

Will Comcast come back with a new system that works around this workaround? We wouldn't be surprised. The company continues to insist that its BitTorrent busting is merely an effort to "manage" its network, arguing that such "management" is well within the rules laid down by the US Federal Communications Commission (FCC).

"We have a responsibility to provide all of our customers with a good Internet experience and we use the latest technologies to manage our network so that they can continue to enjoy these applications," the company once told us.

But don't let Comcast fool you. The BitTorrent community should do everything it can to bust Comcast's BitTorrent busting. And so should the FCC.

Smoke, Mirrors, and FCC filings

Just last week, in a new filing with the FCC, Comcast said that it only "manages" P2P uploads - and that it only "manages" uploads "when the customer is not simultaneously downloading."

This has led some to wonder why Comcast has received such harsh criticism for its behavior. "Who cares if Comcast prevents P2P uploads?" these voices say. "Users can still download whatever they want." But clearly, these voices don't understand BitTorrent.

For one thing, if Comcast prevents its users from uploading files, that prevents all sorts of other people from downloading. "In a peer to peer network, for every single byte being uploaded, there is someone immediately downloading that byte. If Comcast stops or delays an upload, then somebody else's download is also stopped or delayed," Topolski says. "If every ISP immediately decided to block P2P uploads, then all P2P downloads immediately stop."

But that's the small point here. If Comcast prevents its users from uploading, it also throttles the downloads of those very users. "BitTorrent communities often require a byte-for-a-byte exchange to ensure that its members give at least as much as they take," Topolski continues. "A download may take 10 minutes to complete, but it takes 60 minutes to 'pay back' those bytes because of the slower upload speeds provided by most ISPs.

"By cutting off connections once they have finished downloading, Comcast is preventing these community members from maintaining a fair '1:1 ratio' standing in these communities. Because these community members have not yet 'paid back' the bytes that they previously downloaded, they cannot start any new downloads."

Define download

What's more, Topolski insists, Comcast isn't telling the truth when it says that it only interferes with uploads when users aren't simultaneously downloading. "Comcast starts interfering as soon as any of your downloads switches to an upload mode," he explains. "It doesn't wait until all your downloads are done.

So, let's say you're downloading two files: File A and File B. Once File A has finished downloading, Comcast will immediately prevent it from being uploaded - even if File B is still downloading.

Yes, some will say that Comcast has a right to manage its network, to keep traffic flowing smoothly. But that doesn't mean it has no choice but to bag BitTorrents.

"The question is what does management mean?" Topolski says. "Does it mean not selling more accounts than you're able to supply with your available bandwidth? That's definitely a form of management."

You could also argue that Comcast is a business, that it has to make money. Fine. But at the very least, it should tell its customers what's what.

When Robb Topolski first told the world that Comcast was bagging BitTorrents, the company vehemently denied the allegation. A good eight months passed before it admitted to "delaying" P2P traffic - and even this was half a confession.

Here's hoping that new BitTorrent extension arrives tout de suite.

EU Invests $22 Million in Open-Source P2P Technology
Matt Asay

It's ironic how different Europe can be from the United States. While the U.S. continues its mindless rampage against the future of digital distribution with DRM, RIAA, MPAA, and other acronyms designed to stuff the 21st century back into the 20th century's ideas of how to package and sell property, Europe is actually investing in that future. To be exact, it's putting $22 million toward peer-to-peer technology, in a BitTorrent-minded project called P2P-Next.

Surely European broadcasters are against the move, right? After all, research suggests that 50 percent of those using BitTorrent are doing so to steal TV shows. As one TorrentFreak blogger noted, however, European broadcasters believe this situation presents an opportunity rather than a threat:

One of the biggest names taking part is the BBC, who will use the new BitTorrent client to stream TV programs. Other partners in the P2P-Next project are the European Broadcasting Union, Lancaster University, Markenfilm, Pioneer Digital Design Centre Limited and VTT Technical Research Centre of Finland. The main goal is to develop an open source, BitTorrent-compatible client that supports live streaming.

The current project will help broadcasters to find better ways to reach th[e TV-downloading] online audience, and offer high quality on-demand television.
Now if only we could work on U.S. industries threatened (and potentially enriched!) by digitization and downloading. The software industry might actually more fully embrace open source. The entertainment industry would find ways to monetize the heavy demand for its products, as evidenced by file "sharing."

The EU apparently recognizes that the way to monetize P2P is to get out in front of it and enable it on superior terms to those available by more illicit means. Imagine that.

AMPAS Launches YouTube Channel

The Academy of Motion Picture Arts and Sciences launched a YouTube channel Thursday that will provide highlights and exclusive video interviews with members from each of the Academy's branches.

The collaboration marks the first time that the Academy has partnered with an online video community. Participants featured in the clips include Quincy Jones, Alfred Molina, Sidney Poitier and John Travolta.

'A-Team,' 'Kojak' Get New Life on NBC Sites

NBC Universal said Tuesday it will stream full episodes of old TV shows, including The A-Team and Kojak, on its Web sites. Beginning this month, the shows will be available on NBC.com and on network-owned niche sites SciFi.com, ChillerTV and SleuthChannel.com. The NBC.com additions are A-Team, The Alfred Hitchcock Hour, Miami Vice, Buck Rogers, Emergency, Night Gallery, and the original Battlestar Galactica.

Buck Rogers and Battlestar Galactica also will be available on SciFi.com, along with Tek War and Night Gallery. Hitchcock, Swamp Thing, Tremors, Cro, and Night Gallery will be featured on ChillerTV.com. And SleuthChannel.com will present the Telly Savalas-starring Kojak, Miami Vice, A-Team, Night Gallery, and Simon & Simon. The content also will be available on Hulu, the online-video joint venture that NBC Universal launched with News Corp. last year. Through Hulu, the shows will be syndicated to Yahoo, News Corp.'s MySpace.com, MSN, Comcast, Time Warner's AOL, and other Web destinations.

Ad Spending on Web Music Radio Tripled, Report Says

Advertising on Internet music radio stations almost tripled last year as listening grew 26 percent, according to a report by AccuStream iMedia Research. Ad sales increased 194 percent to $80 million in 2007, AccuStream said in a statement Thursday. Shoutcast, a unit of Time Warner's AOL, had the biggest market share of listening hours, with 48 percent. Shoutcast provides music for free, taking revenue from advertising, as do Clear Channel Communications's online unit and Yahoo's music site, the second- and third-ranked online radio sites by hours of listening. Traditional radio companies are suffering from declines in ad spending as marketers transfer part of their budgets to the Internet. U.S. Web users spent 4.85 billion hours listening to music on radio sites last year, up from 3.85 billion in 2006, according to Salinas-based AccuStream.

One Year Later, Still No Timeline For Satellite Merger

Today (February 19) is the one-year anniversary of the official announcement of the proposed merger between XM and Sirius. However, there has still not been any government approval of the proposed merger. At the NBA Tech Summit recently, FCC Chairman Kevin Martin said there is still no timetable for the Commission's approval.

According to PaidContent.org, Martin told reporters, "Traditionally the commission doesn’t act on those after the Department of Justice --99 out of 100 times the Department of Justice goes first and the Department of Justice hasn’t acted yet on that merger. We have some more information we requested at the beginning of the year from the companies so that we’re trying to finalize our conclusions but we’re coordinating with Department of Justice. I don’t have a timeline."

Late last week, the NAB filed new comments with the FCC opposing the merger, on the grounds that both satcasters had violated several terrestrial repeater rules.

Last year, the two satcasters announced their $13 billion "merger of equals" with Mel Karmazin set to be named CEO and Gary Parsons as Chairman.

Winners, Losers in Digital TV Transition
Seth Sutel

TV's big switch from analog to digital broadcasts will be complete in just one year, on Feb. 17, 2009, and many consumers are puzzling over how the shift will affect them: Do they need a new converter box, a new TV, a better antenna?

But it's pretty clear which business interests stand to gain.

Cable and satellite TV companies could see a wave of new subscribers as people with older TVs pass on hooking up converter boxes to older televisions or buying new sets. Local stations are already using some of the extra capacity digital broadcasting frees up by launching auxiliary TV channels with weather and traffic reports, and they're looking for ways to bring programming to portable devices.

The Federal Communications Commission began the switch many years ago to free up a large chunk of U.S. airwaves, which the government is in the process of auctioning off, a process that will net billions of dollars for public coffers. Making all UHF broadcast spectrum above channel 52 available will allow for powerful new wireless services, and possibly for a new network for public safety officials to use during disasters.

Most U.S. TV stations already broadcast digital signals as well as analog. What's happening a year from Sunday is they'll switch off the analog signals. No one with cable or satellite service will be affected, nor will anyone who gets stations over the air with a newer TV with a digital tuner.

Those who will be affected are the 13 million or so households that get TV broadcasts exclusively over the air and have a TV more than a few years old — or even a newer TV that's relatively small. Also affected are TVs not connected to cable, even if a home has cable.

A Nielsen Co. study released Friday found that 16.8 percent of all U.S. households have at least one analog television set that would not work following the switch. And Hispanics are nearly twice as likely as whites to be without TV reception.

Affected households can get a digital converter box, buy a new television or sign up for cable or satellite service or one of the newer cable-like services being offered by phone companies.

A government program said Friday that it will begin sending out coupons Tuesday worth $40 each to any U.S. household that requests them to subsidize buying a box. Each household is entitled to two coupons for the boxes, which are just coming into stores now, start at $40 or $50, making this option easy and practically free. The government says it has funds for 33 million coupons. To get one, go to http://www.dtv2009.gov. or call 1-888-DTV-2009 (1-888-388-2009).

All TVs being made and shipped as of March 1 are required to have digital tuners, which are sometimes called ATSC tuners, after the technical standard used to make them (the analog standard was known as NTSC). Retailers can still sell analog-only TVs from existing inventory as long as they are clearly labeled as such.

If your current TV has the initials "DTV" appear somewhere on its front, or its screen is rectangular, you're probably OK. If you still have the owner's manual, check there whether the tuner is digital.

The new signal could mean the picture on some televisions will improve, but it doesn't guarantee high-definition visuals. That depends on whether a particular TV is set up to receive high-definition programming and whether a program is broadcast that way.
The switch could give an economic boost to retailers and manufacturers, who would benefit from selling the boxes and new TVs. And cable providers could get a boost over the next year or two from consumers who sign up for new service rather than deal with the other options.

According to a report Sanford C. Bernstein & Co. released Friday, an estimated 1.4 million households will likely switch to pay TV service as a result of the digital TV transition — enough to significantly lift the growth rates for the cable industry in 2009, compared to recent years.

Chris Murray, senior counsel for Consumers Union, says his organization is watching that pay TV operators don't take advantage of confusion over the digital transition to push people into buying cable to view digital TV broadcasts. It isn't necessary.

So far he hasn't seen any abusive behavior, but he said: "We want the folks in the marketplace to know that we're watching."

Brian Dietz, a spokesman for the National Cable & Telecommunications Association, a cable TV industry group, notes that cable's educational ads about the transition don't say consumers have to switch to cable.

For retailers, Bernstein analysts say the economic boost is likely to be incremental. The market for the converter boxes is likely to be about $1.4 billion, and for new TVs about $1.7 billion, for a total of $3.1 billion — still a relatively tiny part of the $150 billion U.S. consumer electronics market.

The cost to broadcasters of new digital equipment is relatively small. Tim Thorsteinson, president of the broadcast division of Harris Corp., a major manufacturer of broadcasting equipment, says it costs about $500,000 to upgrade a typical TV station.

The transition comes at a tough point for local TV stations, however, because they are seeing live viewership erode amid a proliferation of ways to watch video — over the Internet, on iPods and DVDs.

Mark Aitken, director of advanced technology at Sinclair Broadcast Group Inc., a major broadcaster based near Baltimore, says digital technology gives TV owners several important ways to hold onto viewers, mainly high-definition broadcasts, which can be a lot more pleasant to watch than YouTube videos.

Aitken calls using HDTV broadcasts the "low-hanging fruit" for TV stations to take advantage of. He points to another big possibility: sending live TV broadcasts to portable devices like cell phones. Adapting the handsets would be simple technically; the far bigger issue is getting broadcasters, programmers, mobile device makers to agree on a standard.

Just next week, a preliminary field trial for three competing technologies for portable TV viewing is getting under way in San Francisco, Aitken said. The industry could have a candidate for the a new mobile TV standard in place by the third or fourth quarter of this year.

Web Movies Show Why DVDs Sell
David Pogue

Ten days ago, Netflix announced that it would abandon HD DVD, Toshiba's entry in the high-definition DVD format war. Six days ago, Wal-Mart dropped HD DVD, too. Then two days ago, Toshiba surrendered, marking the end of the most pointless format war since Betamax-VHS.

Man, if they have Friday beer bashes over at Toshiba, this week's will be a real downer.

Why did so many companies dump HD DVD so fast? Intriguingly, one often-cited reason is the approaching era of Internet movie downloads. The logic goes like this: as long as there's a format war, consumers won't buy DVD players of either type. By settling on a single format - it doesn't really matter which one - the movie and electronics industries can at least start milking the remaining years of the DVD's life.

In fact, though, the Internet movie download era is more distant than pundits think, for four colossal reasons.

First, downloadable movies require high-speed Internet connections - and only about half of American households have them. That number won't change much for years.

Second, downloaded movies don't include the director's commentaries, deleted scenes, alternate endings, alternate language soundtracks or other DVD goodies. It's just not as rich an experience.

Third, movie downloads don't deliver the audio and video quality of DVD discs - even standard-def ones. Internet movies are compressed to download faster, which affects picture quality, and offer older, more compressed audio soundtracks than modern DVDs. (Check out the astounding quality-comparison photos at http://tinyurl.com/3e488m for details.)

Finally, today's movie-download services bear the greasy policy fingerprints of the movie studio executives - and when it comes to the new age of digital movies, these people are not, ahem, known for their vision.

For example, no matter which movie-download service you choose, you'll find yourself facing the same confusing, ridiculous time limits for viewing. You have to start watching the movie you've rented within 30 days, and once you start, you have to finish it within 24 hours.

Where's the logic? They've got your money, so why should they care if you start watching on the 30th day or the 31st?

Then there is the 24-hour limit. Suppose you typically do not start a movie until 7:30 p.m., after dinner and the homework have been put away. If you do not have time to finish the movie in one sitting, you cannot resume at 7:30 tomorrow night; at that point, the download will have self-destructed.

What would the studios lose by offering a 27-hour rental period? Or three days, or even a week? Nothing. In fact, they'd attract millions more customers. (At the very least, instead of just deleting itself, the movie should say: "Would you like another 24-hour period for an additional $1?")

Then there's the fact that to protect their cash cows, most studios don't release their movies on the Internet until a month after they've been available on DVD.

Despite these limitations, plenty of companies are staking out property on the digital-download frontier. Some deliver movies to your computer screen, which will never appeal to anybody but nerds; virtually nobody gathers the family 'round the old Dell on movie night.

Several boxes, however, deliver movies straight to your TV, usually for $3 to $5 each. Here are their report cards.

Apple TV ($230). Thanks to a free software upgrade, Apple's sleek little box has taken on a whole new life. It now connects directly to the iTunes store - no computer needed. Movies are stored on the Apple TV's internal hard drive.

Standard-def movies begin to play only a few seconds after you've selected them; you watch the beginning while the rest is downloading. High-def movies take several minutes to begin playing.

In a couple of years, Apple TV may be the box to beat. The movie store is fun to navigate, picture quality is high and wireless networking is built-in, unlike its rivals. You can buy episodes from any of 650 TV series on demand (usually $2 an episode, no ads), which its competitors can't touch. Finally, of course, the Apple TV does a lot of other stuff; it can display all the music, pictures and movies from your Mac or PC and play podcasts and videos from the Web.

But the Apple TV movie store's shelves look a little bare. Fewer than 1,000 movies are available, and only 100 are in high definition; compare with the 90,000 titles offered by Netflix on DVD, 900 in high-def. (Apple points out that its store's music catalog started out tiny, too - 200,000 songs, compared with 6 million today.) There are some silly bugs in the debut software, too.

Instant gratification: A-. Selection: D. Overall movie joy: B.

TiVo/Amazon Unbox ($100 and up, plus monthly fee). Here's another box whose original purpose was something other than movie downloads. But among its blossoming portfolio of video features, TiVo lets you rent or buy movies downloaded from Amazon.com's Unbox service.

At least you no longer have to order these movies at Amazon.com (although you can, using your Mac or PC, if you prefer to type movie titles with a real keyboard instead of fussing with on-screen alphabets). You can do the whole transaction right from the couch.

Show time is not instantaneous, either; on high-def TiVos, you can't start watching until 10 minutes after you order, and on older models, you have to wait for the whole movie to download (1 to 5 hours). Selection is still slim: 3,200 movies are available to rent; 4,700 available to buy. None are in high definition.

Instant gratification: B-. Selection: C. Overall movie joy: B-.

Xbox 360 ($350 and up). Yet again, here's a box whose movie service isn't the primary attraction (here, it's games). In this case, though, the movie thing isn't just secondary - it's way, way down the list.

You have to watch movies within 14 days, not 30. The remote control isn't designed for video playback. You pay using a confusing system of Microsoft "points," which you must buy in $5 increments. And although there are plenty of TV shows available, only 300 movies are in the catalog at any given time, about half in high definition.

Instant gratification: A-. Selection: D. Overall movie joy: D.

Vudu ($300). This compact black box comes loaded with the beginnings of 5,000 movies. When you rent or buy one, therefore, playback begins instantly. About 20 new movies arrive on the box each week, pushing older ones off the 250-gigabyte hard drive.

Vudu is the only dedicated movie box . The interface is pure and clean, picture quality is tops and the remote has only four buttons (plus a terrific scroll wheel).

On the downside, many of those 5,000 movies are pure direct-to-video dreck (anyone for "San Franpsycho" tonight?). Confusingly, movies on the list come and go according to Vudu's deals with the studios. And you need a pretty fast connection; basic DSL subscribers need not apply.

Instant gratification: A. Selection: B+. Overall movie joy: B+.

When competing with the humble DVD, Internet movie boxes do poorly on price, selection and viewing flexibility (that is, how much time you have to watch). Their sole DVD-smashing feature is the convenience; you get the movie right now.

Meanwhile, other sources of instant movie gratification are emerging. Comcast, the nation's largest cable TV company, offers 1,000 on-demand movies each month, many of them free; by year's end, it intends to increase that number to 6,000 (half in high-def) - and you don't have to buy a special box.

The point is that the whole Internet-movies thing is still in its fumbling, bumbling infancy; someday, we'll look at these limited-selection, limited-time services and laugh.

In the meantime, congratulations to Blu-ray, the winning next-generation DVD format. Clearly, spinning silver discs will remain the dominant movie-delivery method for years to come.

Sony to Sell Chip Facility to Toshiba for $835 Mln

Sony Corp said on Wednesday it will sell its microchip production facilities in western Japan to Toshiba Corp for 90 billion yen ($835 million), in their latest move to focus on their core businesses.

The equipment will be used by their semiconductor joint venture that will make high-performance Cell chips and RSX graphic chips, both used in Sony's PlayStation 3 game console, as well as other microchips that go into Toshiba products.

The venture will be established on April 1.

Sony, which is focusing on image sensor chips for digital cameras and pulling away from heavy investments for cutting-edge chip production equipment, said in October it would sell production facilities for making key microchips used in the PS3 to Toshiba, but the price has been unavailable.

The announcement on the selling price comes on the heels of Toshiba's decision on Tuesday to abandon its HD DVD high-definition DVD format, ending a prolonged battle with the Sony-led Blu-ray camp.

Toshiba twinned the HD DVD exit with an announcement that it and partner SanDisk Corp would spend $16 billion on two new flash memory plants.

Shares in Sony were up 2.8 percent at 5,150 yen in afternoon trade while Toshiba fell 2.8 percent to 801 yen. The Tokyo stock market's electrical machinery index was down 2.1 percent.

(Reporting by Kiyoshi Takenaka, Editing by Michael Watson)

Stringer Makes His Mark
Matt Hartley

Sony's CEO led his company to victory in the high-definition sweepstakes by convincing the major studios to come aboard
Barrie Mckenna and Matt Hartley

Howard Stringer made history in 2005 for being the first non-Japanese executive to take the helm at Sony Corp. But he may be better remembered as the one who won the high-definition war, erasing the stain on the electronics firm's image ever since it lost the videotape war two decades earlier.

Although celebrated yesterday, the victory was sealed last month when Sony swayed Warner Bros. to back Sony's Blu-ray technology and quit producing movies using Toshiba Corp.'s rival HD DVD format.

What remains a mystery is just how big a push Warner needed to pick sides. Analysts say Sony only prevailed following a heated bidding war against Toshiba, with the reward reaching as much as $400-million (U.S.). Neither side has confirmed the size of any bids or payments.

It was supposed to be the technology equivalent of First World War trench warfare: A prolonged battle to the death between Toshiba and Sony for global domination in high-definition DVDs.

In the end, the denouement was more like Germany's swift 1940 end run of the Maginot line.

Less than two years after its first HD DVD player hit the market, Toshiba president Atsutoshi Nishida raised the white flag, declaring yesterday that it would stop making and selling the devices altogether within a month.

Toshiba's unconditional surrender leaves the spoils to Sony, maker of the rival Blu-ray disc player - a technologically superior format that had the backing of virtually all the major movie studies and retailers.

"We simply had no chance to win," Mr. Nishida acknowledged bluntly.

The final straw, he said, was Warner's decision last month to exclusively release movies in Blu-ray. The decision by Warner, with about 20 per cent of the movie market, put a critical mass of the industry in the Blu-ray camp.

With billions of dollars in global sales at stake, experts had predicted the Toshiba-Sony battle would go on for years - not unlike the 1980s battle of videotape formats between VHS (Matsushita) and Betamax (Sony). That war lasted a decade, leaving Sony battered and humiliated.

So how did this epic battle come to such an abrupt end?

The answer lies in part with the bruising Sony experienced with Betamax, which, like Blu-ray, was also the better product on paper.

For more that 20 years, Sony has been "haunted by Betamax" and was fiercely determined not to let history repeat itself, explained Xavier Drèze, a marketing professor at the University of Pennsylvania's Wharton business school.

"Sony was much smarter," Prof. Drèze said. "They understood this time they couldn't do it alone. They understood that they needed strategic partnerships with industry players."

The war was over when Sony managed to line up a critical mass of partners - in Hollywood, Silicon Valley and on Main Street.

The tipping point was Warner Bros. But Sony Pictures, Walt Disney Co. and News Corp.'s Twentieth Century Fox Film Corp. had already done the same - signing exclusive sealed deals with presumably rich royalty arrangements.

"This was heavy hitters in a back room talking about what the royalty structure was going to be and how much money they were willing to put on the table to be exclusive with one camp or the other. That was the determining factor here," concluded Van Baker, an analyst with market research firm Gartner Inc.

Until last month, Warner had been backing both technologies.

Last Friday, Wal-Mart Stores Inc. announced it would sell only Blu-ray DVDs. Officials said "customer feedback" prompted its decision.

Netflix Inc., Best Buy Co. Inc., Blockbuster Inc. and Target Corp. had earlier done the same.

"Everyone was tired of the format war, the retailers were tired of it, the consumer electronics vendors were tired of it and they just wanted this thing to get settled," Mr. Baker said.

"Consumers and the industry learned the hard way with Beta and VHS that a prolonged format war was disastrous. There was a lot of motivation to get one or the other to win and the only thing that protracted it was the amount of money flying around."

The groundwork for Sony's stunning victory, however, came months, even years ago. Prof. Drèze said Blu-ray had several things going for it that helped it to build loyalty with consumers and the industry.

Six years ago yesterday - and years before the first Blu-ray disc or player was sold - Sony had lined up most of the other computer and electronics makers, including LG Electronics, Panasonic, Samsung, Apple and Dell.

Sony also owned a major movie studio. So it could push its own technology.

Third, the company sold Blu-ray to rival movie studios with the promise of superior digital copyright protection.

Sony also used its PlayStation video game console, which also works as a Blu-ray player, as a sort of "Trojan horse," Prof. Drèze said.

Sony has already sold 10.5 million of its PS3 consoles, compared with roughly one million HD DVD players. PlayStation buyers, he said, unwittingly embraced Blu-ray and undermined HD DVD.

Ultimately, the technology is superior. Blu-ray can hold up to three times more data (200 gigabytes versus 60) and offers higher resolution.

In the end, it could be a pyrrhic victory for Sony. The age of hard copy discs is already giving way to digital downloads, stored and played from PCs, iPods and other portable devices.

"I don't think the heyday of DVD is going to return," said Mr. Baker, the analyst. "For most consumers, digital downloads are going to be very appealing."

How Sony lost Betamax


QUANTITY Despite better picture quality, Sony's original Betamax tapes could record only one hour of video, while rival VHS tapes could store double that.


Sony initially failed to license its Betamax technology to a sufficient number of manufacturers, thinking it could go it alone. This led to a situation where VHS players competed against one another for share, driving down prices and making the format more attractive to consumers.

3BUYING V. RENTING When both systems arrived in the United States in the mid-1970s, VHS machines were less expensive to rent. When consumers began to purchase rather than rent their video players, they tended to go with VHS machines.

4PORN CONUNDRUM Sony refused to license the Betamax technology to adult film companies, who turned to VHS tapes and ended up creating a multibillion-dollar industry.

How Sony won Blu-ray


Sony's Blu-ray discs can store upward of 50 gigabytes of data on a single disc, while HD DVDs hold about 30 gigs.


By including a Blu-ray drive in its next-generation video game console, Sony was able to drive sales of both the PS3 and its new DVD format.

3SOLID PARTNERSHIPS Not wanting to duplicate the Betamax mistake, Sony took the initiative to license its Blu-ray technology with as many partners as possible. When Blu-ray was first announced in 2002, Sony had already signed up eight partner companies committed to producing players.


By signing exclusive deals with more studios and content providers than Toshiba, Sony was able to squeeze its competitor to the sidelines. Warner's defection to Blu-ray was the fatal blow.


Dead technologies

Media formats we have used, loved and discarded for the next best thing

The cassette tape

A Walkman and roller skates, anyone? Tapes were the original portable format and made music pirates of us all. (Can I tape your Fleetwood Mac Rumors?) But they were hated by record companies. The sound quality tended to go tinny after a few dozen plays, and many tapes wound up melting in a car on a sunny day.

Eight tracks

Developed by plane maker Bill Lear, eight-track tapes were large and couldn't be rewound. And because of their high tape speed, didn't sound great. Nevertheless, they were popular in the 1970s, thanks to the auto industry, which installed thousands of eight-track players. When sales slipped, companies eager to pare formats quickly dropped the eight track.


Cumbersome to play and easily damaged, albums faded out in the late 1980s. But album covers managed to become a genuine art form and another way to grab music buyers' attention. Lately, albums have a enjoyed a comeback, thanks to collectors, club DJs and scratching (ask your kids).

Compact discs

CDs are dead? They will be soon. Who needs all those plastic cases and discs when you can fill your hard drive and iPod with thousands of songs? Using a credit card, of course. Downloading music for free is wrong, isn't it?


Deadline in Viacom, Google Copyright Suit Extended

A deadline for Google Inc to turn over documents in Viacom Inc's $1 billion copyright lawsuit against the Web search leader has been extended by two months by a federal judge.

Google's attorneys had asked that a March 7 deadline for both sides to turn over documents be postponed by three months because it was wading through 4.5 million documents.

"It's a daunting task," Andrew Schapiro, an attorney for law firm Mayer Brown which represents Google, told the New York Southern District Court.

Judge Louis Stanton agreed on Friday to a new deadline of May 9.

Last March, Viacom sued Google for copyright infringement on its popular YouTube online video sharing service, demanding over $1 billion in damages.

(Reporting by Kenneth Li, Editing by Toni Reinhold)

A Look at the State of Wireless Security

An anonymous reader brings us a whitepaper from Codenomicon which discusses the state and future of wireless security. They examine Bluetooth and Wi-Fi, and also take a preliminary look at WiMAX. The results are almost universally dismal; vulnerabilities were found in 90% of the tested devices[PDF]. The paper also looks at methods for vendors to preemptively block some types of threats.

Despite boasts of hardened security measures, security researchers and black-hat hackers keep humiliating vendors. Security assessment of software by source code auditing is expensive and laborious. There are only a few methods for security analysis without access to the source code, and they are usually limited in scope. This may be one reason why many major software vendors have been stuck randomly fixing vulnerabilities that have been found and providing countless patches to their clients to keep the systems protected.

$10 Chip Puts Australia on the Fast Track
Nick Miller

A new silicon chip developed in Melbourne is predicted to revolutionise the way household gadgets like televisions, phones and DVD players talk to each other.

The tiny five-millimetre-a-side chip can transmit data through a wireless connection at a breakthrough five gigabits per second over distances of up to 10 metres. An entire high-definition movie from a video shop kiosk could be transmitted to a mobile phone in a few seconds, and the phone could then upload the movie to a home computer or screen at the same speed.

The "GiFi" was unveiled today at the Melbourne University-based laboratories of NICTA, the national information and communications technology research centre.

"I believe in the longer term every consumer device will have this technology," said project leader, Professor Stan Skafidas, who with his team spent almost a decade developing the chip.

Hotly contested area

Short-range wireless technology is a hotly contested area, with research teams around the world racing to be the first to launch such a product.

Professor Skafidas said his team is the first to demonstrate a working transceiver-on-a-chip that uses CMOS (complementary metal-oxide-semiconductor) technology - the cheap, ubiquitous technique that prints silicon chips.

This means his team is head and shoulders in front of the competition in terms of price and power demand. His chip uses only a tiny one-millimetre-wide antenna and less than two watts of power, and would cost less than $10 to manufacture.

It uses the 60GHz "millimetre wave" spectrum to transmit the data, which gives it an advantage over WiFi (wireless internet). WiFi's part of the spectrum is increasingly crowded, sharing the waves with devices such as cordless phones, which leads to interference and slower speeds.

But the millimetre wave spectrum (30 to 300 GHz) is almost unoccupied, and the new chip is potentially hundreds of times faster than the average home WiFi unit. However, WiFi still benefits from being able to provide wireless coverage over a greater distance.

Victoria's minister for information and communication technology, Theo Theophanous, said it showed Victoria was at the cutting edge of IT innovation.

He praised the 27-member team which worked on the development of the chip. The high-powered team included 10 PhDs students from the University of Melbourne and collaborated with companies such as computer giant IBM during the research.

"This new technology will dramatically change the way data and content-rich information is managed in the office and the home, as well as enabling new applications," Mr Theophanous said. "The possibilities are endless."

'Several breakthroughs in one'

For Professor Skafidas, the chip is several breakthroughs in one. It includes a world-first power amplifier that is only a few microns wide, with a micron being one 300th the width of a human hair.

It also has world's first signal mixing and filter technology, and a switch that isolates the transmitter and receiver so they do not interfere with each other.

There is about another year's worth of work on the chip before it is ready to be marketed to the public, he said, and the team still needs to develop technology that injects data into the transceiver.

Professor Skafidas said he sees several ways the technology could be put to use.

It could be used to transfer data-rich content such as video around the home between different storage and display devices, and it could help turn a mobile device into a "shopping cart" for data.

A mobile device could also become a fully-fledged computer through the GiFi, simply by placing it near similarly-equipped peripherals such as a screen, extra storage, optical drives, a keyboard and mouse

Smugglers Return iPhones to China
David Barboza

Factories here churn out iPhones that are exported to the United States and Europe. Then thousands of them are smuggled right back into China.

The strange journey of Apple’s popular iPhone, to nearly every corner of the world, shows what happens when the world’s hottest consumer product defies a company’s attempt to slowly introduce it in new markets.

The iPhone has been swept up in a frenzy of global smuggling and word-of-mouth marketing that leads friends to ask friends, “While you’re in the U.S., would you mind picking up an iPhone for me?”

These unofficial distribution networks help explain a mystery that analysts who follow Apple have been pondering: why is there a large gap between the number of iPhones that Apple says it sold last year, about 3.7 million, and the 2.3 million that are actually registered on the networks of its wireless partners in the United States and Europe?

The answer now seems clear. For months, tourists, small entrepreneurs and smugglers of electronic goods have been buying iPhones in the United States and then shipping them overseas.

There the phones’ digital locks are broken so they can work on local cellular networks, and they are outfitted with localized software, essentially undermining Apple’s effort to introduce the phone with exclusive partnership deals, similar to its primary partnership agreement with AT&T in the United States.

“There’s no question many of them are ending up abroad,” said Charles R. Wolf, an analyst who follows Apple for Needham & Company.

For Apple, the booming overseas market for iPhones is both a sign of its marketing prowess and a blow to a business model that could be coming undone, costing the company as much as $1 billion over the next three years, according to some analysts.

But those economic realities do not play into the mind of Daniel Pan, a 22-year-old Web site designer in Shanghai who says a friend recently bought an iPhone for him in the United States.

He and other people here often pay $450 to $600 to get a phone that sells for $400 in the United States. But they are happy.

“This is even better than I thought it would be,” he said, toying with his iPhone at an upscale coffee shop. “This is definitely one of the great inventions of this century.”

Mr. Pan is among the new breed of young professionals in China who can afford to buy the latest gadgets and the coolest Western brands. IPhones are widely available at electronic stores in big cities, and many stores offer unlocking services for imported phones.

Chinese sellers of iPhones say they typically get the phones from suppliers who buy them in the United States, then have them shipped or brought to China by airline passengers.

Often, they say, the phones are given to members of Chinese tourist groups or Chinese airline flight attendants, who are typically paid a commission of about $30 for every phone they deliver.

Although unlocking the phone violates Apple’s purchase agreement, it does not appear to violate any laws here, though many stores may be avoiding import duties.

Considering China’s penchant for smuggling and counterfeiting high-quality goods, the huge number of iPhones being sold here is not surprising, particularly given the popularity of the Apple brand in China.

Indeed, within months of the release of the iPhone in the United States last June, iPhone knockoffs, or iClones as some have called them, were selling here for as little as $125. But most people opt for the real thing.

“A lot of people here want to get an iPhone,” says Conlyn Chan, 31, a lawyer who was born in Taiwan and now lives in Shanghai. “I know a guy who went back to the States and bought 20 iPhones. He even gave one to his driver.”

Negotiations between Apple and China Mobile, the world’s biggest mobile-phone service operator with more than 350 million subscribers, broke down last month, stalling the official release of the iPhone in China. Long before that, however, there was a thriving gray market.

“I love all of Apple’s products,” said a 27-year-old Beijing engineer named Chen Chen who found his iPhone through a bulletin board Web site. “I bought mine for $625 last October, and the seller helped me unlock it. Reading and sending Chinese messages is no problem.”

An iPhone purchased in Shanghai or Beijing typically costs about $555. To unlock the phone and add Chinese language software costs an additional $25.

For Apple, the sale of iPhones to people who ship them to China is a source of revenue. But the company is still losing out, because its exclusive deals with phone service providers bring in revenue after the phone is sold. If the phones were activated in the United States, Apple would receive as much as $120 a year per user from AT&T, analysts say.

But there are forces working against that. Programmers around the world collaborate on and share programs that unlock the iPhone, racing to put out new versions when Apple updates its defenses.

While Apple has not strongly condemned unlocking, it has warned consumers that this violates the purchase agreement and can cause problems with software updates.

Some analysts say abandoning the locked phone system and allowing buyers to sign up with any carrier they choose, in any country, could spur sales.

“The model is threatened,” Mr. Wolf, the analyst, said. But “if they sold the phone unlocked with no exclusive carrier, demand could be much higher.”

An Apple spokeswoman declined to comment on the proliferation of iPhones in China. When asked about the number of unlocked iPhones during a conference call with analysts last month, Timothy D. Cook, Apple’s chief operating officer, said it was “significant in the quarter, but we’re unsure how to reliably estimate the number.”

The copycat models are another possible threat to Apple. Not long after the iPhone was released, research and development teams in China were taking it apart, trying to copy or steal the design and software for use in knockoffs.

Some people who have used the clones say they are sophisticated and have many functions that mimic the iPhone.

In Shanghai, television advertisements market the Ai Feng, a phone with a name that sounds like iPhone but in Chinese translates roughly as the Crazy Love. That phone sells for about $125.

Some of the sellers of the copycats admit the phones are a scam.

“It’s a fake iPhone, but it looks nearly the same,” said a man who answered the phone last week at the Shenzhen Sunshine Trade Company, in southern China’s biggest electronics manufacturing area. “We manufacture it by ourselves. We have our own R. &D. group and manufacturing plant. Most of our products are for export.”

Most people here seem to want the glory that comes with showing off a real iPhone to friends.

“My friends envy me a lot,” says Mr. Pan, the Web designer. “They say, “Wow, you can get an iPhone.’ ”

John Markoff contributed reporting from San Francisco.

After Stumbling, Facebook Finds a Working Eraser
Maria Aspan

Facebook.com, stung last week by the wrath of members who want to sever their relationships, tripped again when it tried to let them do so.

But the company said over the weekend that it had fixed the problems, making it possible — and not too difficult — to delete an account from the site entirely.

The problems, which Facebook described as technical, had to do with a form it introduced last week for users who want to obliterate their accounts. Until then, deleting an account was a fairly cumbersome procedure.

But as a few departing users found out, Facebook — a social networking site that lets people create profiles of themselves and identify other people as “friends” — still had a few bugs left. Some people who used the form discovered that only certain parts of their accounts had disappeared.

Katie Geminder, Facebook’s director for user experience and design, said internal adjustments to the tool used to delete accounts had created a technical snag that affected “a small percent” of Facebook users. “None of their information was exposed, but the empty account continued to exist even though all of its data had been removed,” she said by e-mail. The bug was fixed within 24 hours, she said.

One such partially deleted user was Matt Dauphin, a 22-year-old office manager for an interior design firm in Tempe, Ariz., who tried to delete his account after reading about the new form last week. He received confirmation by e-mail of the deletion from Facebook’s technical support team.

But even after he received that confirmation, a working link to his empty Facebook profile was the first result in a Google search for his name. While his name, photo and profile information had been deleted from the Facebook page, his friends who still used the service could see his lists of friends and the external applications he had added to his profile.

“It’s a little disturbing that you can see people that I used to talk to — that’s not right,” Mr. Dauphin said Friday. He said he was annoyed at Facebook’s refusal to create a one-step “delete account” button instead of the form.

By Saturday, Facebook had removed the remaining traces of his account from the site.

Still, such experiences have done little to quiet the jitters of many users, who see Facebook’s adjusted policy as an inadequate response to their demand for an easy opt-out button and to their larger concerns over the network’s efforts to profit from the private information they volunteer to the site.

In November, Facebook introduced an advertising program called Beacon that tracked its users’ activities on other Web sites and sent reports to their friends. Users complained that it was intrusive, leading Facebook to scale back the program.

Magnus Wallin, the founder of a Facebook group called “How to permanently delete your Facebook account,” posted a warning on Friday.

“Users who have requested to be deleted via the recently introduced form are only partly deleted, even though the deletion is confirmed by Facebook staff,” Mr. Wallin wrote.

On Saturday, after the partially deleted profiles disappeared, Mr. Wallin said in an e-mail message, “Now there seems to be a way to completely remove yourself from Facebook, without having to delete items individually.” But he does not plan to retire from his group.

“It’s pretty obvious that Facebook are scared of losing loads of members if they made the delete option easily available,” Mr. Wallin said.

Mr. Wallin also posted the message that Facebook sends to people to confirm their deletion, which says in part, “We have deleted your profile information and removed your e-mail address from our login database.” But, as Mr. Wallin added, “if you are paying close attention, you can see that they’re actually not saying that they delete your profile, only that its information and your login is removed.”

In response to these concerns, Chris Kelly, Facebook’s chief privacy officer, confirmed that deletion “removes all personal information from the account.”

Many Facebook members use an application called “the wall,” which lets them swap graffiti-like messages with friends in their network; Mr. Kelly said the wall posts of deleted members also disappear, though traces remain.

“After deletion, there may still be a record in Facebook’s archives that a user made a particular wall post in a group on a particular date, but Facebook’s servers no longer contain the information needed to connect that user ID (e.g., name, e-mail address, networks, etc.) to the person associated with that account,” he said in an e-mail statement on Friday.

Some people said they found it much easier to leave Facebook last week. John Keefe, a 52-year-old freelance financial writer in Manhattan, said that he contacted Facebook on Tuesday asking to be deleted “and got back a satisfactory answer in a few hours.”
Nipon Das, a Manhattan business consultant who had gone so far as to threaten legal action in order to quit Facebook, also got some satisfaction: After resubmitting his request to be deleted from Facebook on Wednesday and reconfirming it on Thursday, Mr. Das received a confirmation e-mail from Facebook on Friday.

“This started around October,” he recalled in an e-mail message, adding that now, in mid-February, “we may have closure.”

Mr. Das may be in distinguished company. On Feb. 8, a British newspaper, The Sun, reported that Bill Gates, the chairman of Microsoft, had deleted his Facebook account not out of privacy concerns, but because he got “more than 8,000 friend requests a day and spotted weird fan sites about him.”

A post on a Wall Street Journal blog later reported that Mr. Gates had stopped using the profile instead of fully deleting it; a Microsoft spokeswoman declined to comment.

The Power of Whimsy
Phyllis Korkki

SANDRA BOYNTON’S studio, in a converted barn next to her Connecticut home, bears the milestones of her singular career: a long rack of greeting cards featuring quirkily drawn animals; a room full of small, sturdy children’s books, with names like “Snuggle Puppy!” and “Barnyard Dance!”; and, upstairs, where she does much of her work, old-time radios and jukeboxes representing her more recent foray into music CDs for children.

Ms. Boynton’s CDs have garnered three gold records and one Grammy nomination. These accomplishments, on top of the hundreds of millions of cards and tens of millions of books she has sold, are all the happy — and profitable — results of an unconventional approach to business.

As an entrepreneur, Ms. Boynton maintains a firm grasp on market realities and her finances, but she says she has succeeded by refusing to make money her main objective. Instead, she says, she has focused on the creative process, her artistic autonomy, her relationships and how she uses her time.

“I don’t do things differently to be different; I do what works for me,” she says. “To me, the commodity that we consistently overvalue is money, and what we undervalue is our precious and irreplaceable time. Though, of course, to the extent that money can save you time or make it easier to accomplish things, it’s a wonderful thing.”

While Ms. Boynton may make all of this sound relatively straightforward, she has overcome hurdles in three industries that have routinely tripped up or roundly laid low legions of would-be entrepreneurs.

MS. BOYNTON, 54, describes what she calls an “absurdly happy childhood” in Philadelphia. The third of four daughters, she attended Germantown Friends, a K-12 Quaker school famed for its arts education and interdisciplinary teaching. Her father, Robert Boynton, was an English teacher at the school. “The best English teacher I ever had,” she says.

She was fascinated by business at an early age and remembers selling pretty yellow flowers door to door for a dime when she was 8. Later, she discovered that they were weeds, but she still had takers. “I always liked selling things,” she says. “It gives you a sense of self-sufficiency.”

When Ms. Boynton was 14, a local newspaper printed drawings from an exhibit of her school artwork. She used the $40 she earned from her first published work to invest in two shares of AT&T — though she mistakenly thought she was buying shares of I.B.M. She still has the stock but has no clue how much it is worth.

Stocks held a special glamour for her: Her grandfather worked at a silver company, rising from the mailroom to the vice president’s perch. “Family legend has it that the company offered penny-a-share stock to employees, and he bought as much as he could afford,” she says. “And he became a wealthy man. That stock eventually put most of his 17 grandchildren through college.”

In addition to her investing activity, she developed a strong interest in art, music, literature and writing — all of which were central to the Friends curriculum. The school was so stimulating, academically and artistically, she says, that her first year at Yale was a disappointment.

At Yale, she majored in English, became involved in drama courses and productions and met her future husband, Jamie McEwan, in an acting class. She also worked on her drawing. Ever the entrepreneur, she started illustrating gift enclosure cards that were precursors of her animal-populated greeting cards.

In 1974, Ms. Boynton met Phil Friedmann, a partner in Recycled Paper Greetings, a greeting card company based in Chicago, at a stationery trade show. After Mr. Friedmann and his business partner, Mike Keiser, saw Ms. Boynton’s work, they asked her to start making cards for their company.

They wanted to pay her a flat rate. Though she was only 21 and unknown, Ms. Boynton, who had learned a lesson or two from her father’s other careers as a writer and publisher, demanded royalties.

“We quickly relented,” Mr. Keiser recalls of the royalty negotiations. It was a shrewd move on his part, too. He says that over about a decade — from the mid-1970s to the mid-1980s — revenue at Recycled Paper went from $1 million to $100 million, largely because of the popularity of Boynton cards. Ms. Boynton has made 4,000 different cards for Recycled Paper, including the still popular “Hippo Birdies 2 Ewes” birthday card.

By Mr. Keiser’s rough estimate, Ms. Boynton has sold around a half-billion cards, which, he says, makes her one of the best-selling card creators of all time.

Her cards have become such a part of the mainstream that it is easy to forget how radical they were when they were introduced. Dominated by powerhouses like Hallmark and American Greetings, the card industry in the 1970s relied on flowery, color-saturated art and equally flowery prose, written in flourishes and curlicues.

Ms. Boynton’s cards, on the other hand, were populated with cats, cows, hippos, ducks, sheep, dragons and various other beasts, humanized through the placement of a dot for a pupil, or a single, expressive arc for an eyelid or mouth. She was also among the first greeting card artists to use white backgrounds.

Her cards were thoughtful, wry and whimsical. While the sentiments may have been unconventional, they resonated with the public.

“Things are getting worse,” said one card that featured a bewildered hippo. On the inside it said “please send chocolate.”

Whimsy, it turns out, had been undervalued. And the big card companies eventually took some of their artistic cues from her.

“It’s a lot easier to start in this business today than it was when Sandra Boynton got started,” Patti Stracher, manager of the National Stationery Show, the country’s biggest annual greeting card showcase. “She fueled a trend in what were then called alternative greeting cards. Alternative cards helped people communicate about topics that were really hard to address or that you could poke fun at.”

AFTER the cards came the books. Continuing with the chocolate theme, in 1982 Ms. Boynton published a general market book titled “Chocolate: the Consuming Passion” that became a best seller. Its publisher, the Workman Publishing Company, went on to print some of her children’s board books — small books with thick, boardlike pages, with 5 to 10 rhythmic words per page.

The books feature some of the same furry and feathery characters that her cards do, presenting a world that her editor of 27 years, Suzanne Rafer, calls “safe, unexpected and pleasurable” for children.

The most popular board book by Workman, “Barnyard Dance!” (“Bow to the horse. Bow to the cow. Bow to the horse if you know how.”) was published in 1993 and has 2.3 million copies in print.

Wendy Rhein of Atlanta has been reading Ms. Boynton’s books to her son, Nathan, 2 1/2, since he was born. “The drawings are entertaining,” she said, “and there’s a lyricism and rhyming that goes on that’s very singsong, and they’re fun for me to read to him.”

Succeeding in the children’s book market is hard and becoming more so, said Michael K. Norris, senior analyst at Simba Information, a market research firm. Technology is luring children away from books, and only a small percentage of children’s books wind up on families’ shelves.

“The market favors authors who have built up their brands over time,” Mr. Norris says. He says she also has an edge because “she knows exactly who her audience is and knows how to reach them.”

FROM books, Ms. Boynton decided to extend her rhythmic sensibility into song. She says she was helped along by “dumb luck.”

When she was working on the album “Philadelphia Chickens” in 2001, for instance, she told Mike Ford, her songwriting partner, that Meryl Streep (a fellow Yale alumna and a friend) was the only person who could do justice to the song “Nobody Understands Me.”

The very next day, Ms. Streep happened to stop by her studio. She recorded the song and then suggested that the actor Kevin Kline might want to record one, too. He sang “Busybusybusy.” Another friend of Ms. Boynton’s, Laura Linney, sang for the album, and Ms. Linney helped arrange for Eric Stoltz to put in an appearance.

Buoyed by her Hollywood supporters, Ms. Boynton approached some of the biggest names in the music industry — including Alison Krauss, Blues Traveler and the Spin Doctors — to contribute to her next album, “Dog Train.” From there, she was able to persuade some of her music idols — including Neil Sedaka, B. B. King, Steve Lawrence and Davy Jones — to sing on her most recent effort, called “Blue Moo: 17 Jukebox Hits From Way Back Never.”

It was lucky, Ms. Boynton says, that many managers of the big musical acts were men in their 30s who had young children who loved her books. And there was another stroke of luck: she decided to use her longtime publisher, Workman, to package her CDs inside of books instead of selling them in music stores. In retrospect, that alternative form of distribution was a stroke of genius, because it came just as the music business seemed to be imploding.

Ms. Boynton’s studio is not far from the farmhouse that she and her husband, Mr. McEwan — also a children’s book author — bought 28 years ago. In addition to creating greeting cards and children’s books, the couple also raised four children there, now ages 18 to 28.

The studio and her five-bedroom home, built in 1728, sit on 100 acres of rolling northwestern Connecticut countryside — evidence of a life that is comfortable, but not lavish.

When she is working on her music, Ms. Boynton drives five miles across winding rural roads to Mr. Ford, her songwriting partner, who also works out of a studio next to his house. The two sit side by side in leather chairs in front of an electronic keyboard and a computer loaded with music software, working to find the right sounds for her lyrics.

One three-minute song, from writing to final recording, can take a month to complete. She and Mr. Ford put in 14-hour days when they are in the thick of a project. “You have to enjoy the process of making it happen,” she says.

BECAUSE she has made so much money from her cards and books, Ms. Boynton says, she doesn’t need to rely on her CD business for income. Although the CDs make money for her publisher, she says they don’t make money for her. Essentially, she views them as “loss leaders” — products that are valuable not because they are profitable but because they help her maintain contact with her audience.

That philosophy helped persuade the blues singer B. B. King to record “One Shoe Blues” on her most recent CD. The song is a soulful lament that captures a toddler’s anguish about not being able to find a missing shoe when Mama is ready to go.

“At the level of detail I think is necessary to make them what they are, they simply can’t pay for themselves,” Ms. Boynton says of the CDs. “In purely business terms, it’s an irrational enterprise. And it’s also the best work I do.”

Ms. Boynton doesn’t have an agent. She has just one employee: her assistant, Kathleen Sherrill. There is no Inc. or LLC after her name. She prefers to be an unincorporated business with an orbit of “licensees,” for lack of a better word, around her.

Whenever she has made products like stuffed animals, mugs, jewelry, sheets or towels, she has maintained control over the finished product so it doesn’t stray from her vision — or saturate the market.

“Theoretically, I could choose to trade artistic autonomy and pride in my work for increased income — say, by broadly licensing my characters to be used for television,” she says. But that would be foolish, she says.

“I love what I do, I love the people I work with, I care very much about the value of the work I create, and I don’t need more money than I have. This is not revolutionary philosophy. It’s just common sense.”

'Dilbert' Retells Story Of Iowan Fired Over Comic
Clark Kauffman

Is it a case of art imitating life, or life imitating art?

"Dilbert," the newspaper comic that routinely ridicules self-important office managers, is taking aim this week at an Iowa company that fired an employee for posting a "Dilbert" strip in the office.

In a bit of self-referential cartooning, "Dilbert" creator Scott Adams has penned a series of strips that indirectly describe the plight of Dave Steward, a former security supervisor for Catfish Bend Casino in Burlington. Steward, 50, a resident of Fort Madison, was fired by the casino last fall after seven years of employment. He had posted on an office bulletin board a "Dilbert" strip in which the protagonist compares his bosses to a bunch of "drunken lemurs."

Casino managers were not amused. By reviewing surveillance tapes, they determined that Steward was responsible for posting the cartoon. They fired him and accused him of not being a "team player."

The dismissal became national news after The Des Moines Register reported the outcome of a hearing at which the casino challenged Steward's claim for unemployment benefits. The casino's human resources director, Steve Morley, testified that "upper management" was offended by the cartoon. "Basically, he was accusing the decision-makers of being drunken lemurs," Morley testified.

The judge in the case sided with Steward and said his actions represented an error in judgment, not intentional misbehavior.

In a new series of "Dilbert" comics that begins today, Steward's bosses — represented by the strip's infamous Pointy-Haired Boss — are lampooned for their actions. Steward is depicted by Wally, the strip's bespectacled, coffee-swilling office drone. Steve Morley is portrayed by Catbert, the evil human resources director.

You can read today's "Dilbert" strip here.

In one of the strips, Adams gives his take on Steward's dismissal.

Catbert: "Wally, I have to fire you for posting a comic comparing managers to drunken lemurs. You won't be eligible for unemployment benefits unless you can prove you were stupid as opposed to malicious. Can you prove you're stupid?"

Wally: "Is there another explanation for working here?"

Another strip features a reporter from the "Dogbert Gazette" pursuing the story and searching for quotes to support his thesis that the man responsible for the firing is a "humorless stain on the soul of humanity."

Adams acknowledged in an interview that Steward's firing was the impetus for this week's series of comics.

"I know good comic fodder when I see it," he said, "and any chance to mock the humorless is worth the effort."

Asked whether he was amused, honored or embarrassed to be immortalized in "Dilbert," Steward said it was a combination of all those things. He said he is a big fan of Adams' work.

"I have five of his books," Steward said. "My wife and I both comment on how they relate to (the casino). She worked there from 1994 to 1998, so she knew what I was going through. The day I was fired, she went to work and the same comic was on several of the bulletin boards where she works. Nobody got fired."

Morley declined to comment on the new "Dilbert" comics.

Steward, who is still looking for work, said the news stories about his dismissal last year prompted a lot of people to get in touch with him.

"I received a lot of 'attaboys' from everyone," he said. "Ex-employees, current employees and patrons were not happy about me getting fired for something so trivial."

As for this week's comics, Steward said he probably will add them to his scrapbook.

But will he ever post a "Dilbert" at his workplace again?

"If I thought I would get the same results as I did that time, no," he said. "I hope to work somewhere that has a sense of humor — when I find something."

For Publisher in Los Angeles, Cuts and Worse
Richard Pérez-Peña

The Hollywood Walk of Fame consists of more than 2,000 terrazzo-and-brass stars embedded in the sidewalk, bearing names from eminent to obscure (Strongheart the dog, anyone?). The walk attracts tourists, but most locals step over — make that drive past — without noticing.

When The Los Angeles Times received a star last year, it was met at the paper with shrugs, eye rolls and grumbling about money ill-spent (the local chamber of commerce charges $25,000 for the honor). But it meant something to the new publisher, David D. Hiller, who enthusiastically attended the installation and told editors that the newspaper should cover it. They protested that the idea amounted to using a news-free stunt for unseemly self-congratulation, and Mr. Hiller deferred to their judgment.

“You know what? I did get a kick out of it, and I thought it was great for the paper, and I thought it was fun,” Mr. Hiller said about the Walk of Fame ceremony. “And if that makes me star-struck, then I’m guilty as charged.”

Mr. Hiller never had much chance of getting the benefit of the doubt at The Times, one of a handful of newspapers with a claim to national standing: its daily circulation of almost 800,000 is the fourth-largest circulation of any American newspaper and the largest in the West, and it dominates the second-biggest market in the country, after New York.

But The Times has also been battered by years of flagging revenue, management turnover and newsroom cutbacks.

The paper’s owner, the Tribune Company of Chicago, sent Mr. Hiller to California in late 2006 to impose some discipline, fiscal and otherwise. He took the place of a popular publisher and promptly fired a popular top editor, both of them forced out for refusing to carry out the latest round of staff cuts ordered by Tribune.

Last week, after a very bumpy 16 months, he hired a new editor, Russ Stanton. He also has a new boss, Samuel Zell, a real estate billionaire who took the Tribune Company private in December, saying that he was giving more autonomy to Mr. Hiller and other chiefs of Tribune properties.

But with the company scraping to meet heavy debt payments, Mr. Hiller faces the daunting task of showing his new bosses that he can turn around a paper hit by an industrywide contraction, a California real estate slump and internal dissension.

Within The Times, however, many employees dismiss Mr. Hiller, 53, as a star-struck outsider, a meddler in the newsroom who does not understand journalism or Los Angeles.

The Walk of Fame episode became emblematic of the view at The Times of Mr. Hiller and Tribune generally, and it was cited repeatedly in interviews with current and former business executives, editors and reporters, nearly all of whom spoke on the condition of anonymity because they said they feared retribution for speaking out.

He does not entirely disagree with the criticism of the old Tribune Company or even of him, though he says much of it is overstated.

“What we have to do is get beyond the history,” Mr. Hiller said in an interview on Friday. “And I’m really confident that we’re doing that. This is no longer about Chicago versus L.A. This is about how does The L.A. Times change.”

His first major act of the new Tribune era came last month, when he ousted yet another top editor, James E. O’Shea, who had gradually won the trust of his staff and, like his predecessors, refused to make more newsroom cuts. The newsroom has about 870 employees, down from a high of about 1,200, and Mr. Hiller says he expects to lower that number by 40 to 50 this year.

“If I had my way and if business were great, I wouldn’t cut anybody in the newsroom, or in most other departments,” he said, adding that he believes in the public service mission of newspapers. “We are stretched to the max trying to cover the complexity of our region the way we’d like to.”

The turmoil continued Monday, when John Montorio, one of two managing editors — the second-highest newsroom position — announced that he would leave the paper this month.

Mr. Montorio, who oversees the feature sections, said that Mr. Stanton “has just decided to take the features department in a new direction, that he wanted a new leader. And that is the right of every new leader, to choose his own team.”

Tribune does not report each property’s performance, but through November, the company said that 2007 newspaper ad revenue had fallen 8.5 percent (compared with about 7 percent in the entire industry) and that Los Angeles had among the sharpest declines in retail and classified ads. Mr. Hiller said he expected another drop in 2008.

A person who had been shown the numbers said The Times had earnings of $240 million in 2006 and $192 million in 2007 (before interest, taxes, amortization and depreciation), and projected about $150 million this year before the announced cuts — figures that Mr. Hiller said were roughly accurate.

Former executives say that the paper had an operating profit margin above 20 percent until two or three years ago and that it is in the midteens now. Some executives within Tribune said the company wants The Times to match last year’s cash flow, a tall order in this economic climate.

Mr. O’Shea has argued that focused newsroom investments, like a successful fashion section that was started last year, can generate more ad revenue. Mr. Hiller agrees that some of those ideas work, but he has also said that The Times cannot spend its way to profits and that Mr. O’Shea and his predecessor, Dean Baquet, had trouble accepting financial reality.

Mr. Hiller’s relationships with his top editors have been worsened by less-than-straight shooting, according to several people at the paper — fed, they said, by his aversion to direct confrontation. Mr. Hiller said that Mr. O’Shea left by mutual agreement; Mr. O’Shea, who declined to be interviewed for this article, has said that he was fired, and after Mr. Hiller had already talked to others about dismissing him.

When he arrived in October 2006, Mr. Hiller said that he wanted to work with Mr. Baquet and that he did not have in mind specific numbers of jobs to cut. Some high-ranking officials at The Times say that he told them privately then that he did have specific targets, and a month into the job, he fired Mr. Baquet.

“It was a constant treadmill of cuts, and nobody ever said: ‘Let’s catch our breath. Let’s figure out some sort of long-term plan,’ ” said Mr. Baquet, who is now an assistant managing editor and the Washington bureau chief of The New York Times. “When you tried to have a conversation about where you’re going strategically, the answer was always, ‘Let’s just get past this next round of cuts.’ ”

Several other top editors and some business-side executives — some still at the paper, some not — voiced the same complaint.

“I think that’s been true in the past,” Mr. Hiller said. “We have spent the last six months putting together a long-range plan of just that sort,” though the plan is not complete. “I totally agree,” he said. “If you can’t paint that picture, you can’t take people there.”

But his statements and actions, like firing Mr. O’Shea, strongly suggest that the friction between him and his fractious paper will continue. Even Mr. Stanton, the new editor Mr. Hiller appointed, said in an address to the newsroom on Thursday that he was “hopping mad” about the seemingly endless cuts, and that they had to stop.

Top Times executives have discussed letting marketing executives control the monthly Sunday magazine, rather than leaving it to editors, though Mr. Hiller says no decisions about that have been made. The idea touches on the traditional tension in journalism, between profiting as a business and making independent judgments about what information to deliver, without concern for advertisers’ interests.

Mr. Hiller has sent notes to reporters suggesting or assessing articles, to the frustration of editors who see it as inappropriate.

Last Friday, Mr. Hiller put Jack D. Klunder, a well-regarded executive who joined The Times long before Tribune took over, in charge of the paper’s business operations. And he announced that the widely criticized chief of ad sales, a Tribune veteran sent from Chicago, would leave.

Colleagues doubt that Mr. Hiller could have made such moves under the old Tribune regime that promoted its own and mistrusted Times veterans.

The paradox of Mr. Hiller’s position is that, by all accounts, he is outgoing and wants to be well-liked. Within the company, he has been called “the class president” and “the cheerleader.”

A Harvard-educated lawyer, Mr. Hiller joined the Tribune Company 20 years ago. He oversaw its Internet operations from 2000 to 2004, then served as publisher of The Chicago Tribune for two years.

For years, as newspaper Web sites became deeper, richer and more complex, Tribune’s sites fell behind, limiting their ability to draw readers and advertisers. Just last week, the Times Web site added the ability to put hyperlinks in its articles, something other major papers have had for as long as a decade.

But The Times’s site has improved significantly since he arrived, adding video and dozens of blogs. It had 5.7 million unique United States visitors in January, according to Nielsen/NetRatings, fifth among newspaper sites, behind The New York Times (20.5 million), USA Today (12.3 million), The Washington Post (9.9 million) and The Wall Street Journal (7 million).

Mr. Hiller revels in the publisher’s traditional role (much diminished at most papers) as a prominent civic figure, meeting with elected officials and serving on the boards of nonprofit organizations.

His duty and the paper’s is to be “a very visible citizen in the community,” he said. “I’m a booster of things that are good in Los Angeles.”

Mr. Hiller clearly has a fondness for show business and enjoys life in his adopted home. Last year, he used the newsroom’s allotment of tickets to attend the Oscars. When The Times had a 125th birthday party, he took the microphone and sang “Hello, Dolly” and “Baby, It’s Cold Outside” to several hundred employees.

He said, “I’m hoping the Dodgers or the Angels are going to invite me to sing the national anthem this year.”

A Plan to Offer 50 Sites on Politics in 50 States
Brian Stelter

In the middle of a media-saturated political season, Jared Kushner, publisher of The New York Observer, has been quietly nurturing an ambitious political journalism venture.

The plan is to pull together 50 Web sites, one for each state, into a political hub called Politicker.com. Each site will serve as an intensely local source for political articles, speculation and scandal, Mr. Kushner said.

Ten sites are online already, and the 11th, covering Kentucky, is scheduled to go up this week. Mr. Kushner hopes his multimillion-dollar investment — he would not be more specific — will attract an influential readership and, in turn, advertisers who want to reach those readers.

“Instead of taking out ads in five papers across the state, if you want to reach the most influential and politically active people, all you have to do is buy an ad package on the site,” he said.

The Observer Media Group, which owns both the namesake newspaper and the Politicker brand, has kept relatively quiet about the development of the state sites. They will most likely become more prominent when a national site aggregating the local content starts within the next few weeks.

“We view this as one of the most ambitious projects right now in journalism,” said Robert Sommer, the president of the Observer Media Group. “We’re basically creating 50 news bureaus with full-time reporters in each state.”

Mr. Sommer said that the company saw itself filling the political news niche that budget-strapped local newspapers are increasingly deserting. But the Politicker network faces some formidable challenges — primarily, figuring out who, exactly, will advertise on the sites.

Even in this early stage, some of the Politicker sites are performing better than others. The Oregon site broke the news of a congresswoman’s retirement two weeks ago, and the Maine site obtained an interview with Barack Obama ahead of the state’s caucuses. But other sites are drawing criticism because they are updated infrequently. An online magazine in Vermont said that the local Politicker had received “a whopping zero” comments from readers.

The company also has to prove that it can replicate the success of PoliticsNJ.com, a widely read and well-regarded guide to New Jersey politics that Mr. Kushner purchased in a private transaction last March. Mr. Kushner would not share traffic figures, but said that the New Jersey site had performed “much better than I expected” and had already become profitable.

The company has used the redesigned PoliticsNJ.com as a model for the expansion. The first states added to the portfolio — New Hampshire, Maine, Nevada, Oregon — were relatively small states with competitive Senate or presidential races. The company hopes to have sites in 20 states by Election Day before expanding to all 50 states by the end of 2009.

The company already employs 30 people, including James Pindell, a former political blogger for The Boston Globe who became managing editor of the site last month. The strategy is straightforward: Mr. Pindell will hire young journalists, send them to state capitals with little more than a laptop and a BlackBerry, and let them build each state site.

What the young reporters lack in experience, they make up for in passion about politics, Mr. Sommer said.

“They can quote what happened in a Congressional race in Arizona in 1952 even though their parents weren’t born yet, the same way I can tell you every pitch from Tom Seaver’s near-perfect game in 1969,” he said.

Mr. Sommer said that in the future, the company plans to require subscriptions for some parts of the Politicker sites, but until then will rely entirely on advertising revenue.

Most states will be covered by one or two reporters, one editor working on contract from inside the state, and an undetermined number of bloggers. The editors — who will remain anonymous, and will include lawyers, lobbyists and former officeholders — are the “secret sauce,” Mr. Sommer said.

Although their anonymity lends an aura of mystery, many of the editors will have partisan ties and political leanings. Mr. Kushner, whose father was a major Democratic fund-raiser, emphasized that the Web sites were not affiliated with any political party or ideological agenda.

Jay Rosen, a blogger and professor of journalism at New York University, said that sites like the Politicker are partly a consequence of declining investments in newsgathering by local newspapers and television stations. He said the venture’s success would depend on whether it stressed original reporting.

“If they can invest in people on a full-time basis digging up information and connecting with constituencies, then it can work,” he said. “If it’s just warmed-over news from elsewhere and snappy opinion, that’s not going to make much of a difference.”

Identity Cards 'Useless in Fight Against Terrorism'

Mass fingerprinting, biometric passports, identity cards and international identity databases will not protect Britain and other European countries from terrorists or criminals.

This startling admission comes in a leaked European Commission report prepared for Home Secretary Jacqui Smith and other EU Home Affairs Ministers.

The report undermines Gordon Brown's claims about the need for controversial new passports and identity cards to protect the country from terror attacks.

It raises new questions about the true purpose of Government databases, which will store intimate details of everyone in Britain, including their picture, fingerprints and confidential personal information.

The EU report, obtained by The Mail on Sunday, says most people behind terror attacks in the UK and Europe were living in the EU legally and so would not be affected by increased security measures.

It says: "None of the policy options contribute markedly to reducing terrorism or serious crime.

July 7th tube bombing: The EU report says most people behind terror attacks in the UK and Europe were living in the UK legally and so would not be affected by increased security measures

"In view of the latest terrorist acts in the area of the EU... the perpetrators have mainly been EU citizens or foreigners residing and living here with official permits."

But it does say that the new technology could save money by using automated checks at borders.

Nursery Installs Fingerprint Scanner at Door

Fingerprinting students in school is controversial, and many parents object to it; less controversial is installing fingerprint scanners at nurseries' doors, to make sure that only parents and authorized personnel are allowed in

A growing, if controversial, trend: A nursery has installed fingerprint scanning at its entrance to increase the safety of its young pupils. The biometric security system at Mes Enfants nursery in Mumbles, Swansea, allows only authorized parents and staff to access the building. When registered people swipe their finger, their details also flash up on a computer so staff know who is there. Nursery owner Rebecca Treharne said the aim was to give parents and staff added confidence.

The nursery has been running for five-and-a-half years and has 100 children on its books, aged from four months to four-and-a-half years old. It believes it could be the first nursery in Wales to adopt such a system for staff and parents. Treharne said: "I like the nursery to be quite forward thinking and modern in approach. I think this is the way forward. Parents are automatically conscious of security, happiness and wellbeing. In nursery this has to be a priority. Security has to be on top of the list."

Feedback from parents had been positive, said Treharne, and the new system -- which also has video and audio -- was better than the buzzer and intercom they previously had. It also eased the workload on staff, she added, as they did not have to leave children to open the front door so can spend more time supervising their pupils. The system was installed by Newcastle-based UK Biometrics which also uses iris recognition and facial patterns in its security products. The scanner registers a fingerprint in seconds and then stores an encrypted version for future comparison, protecting the identity of authorised users. UK Biometrics director Ryan Hole said: "By fitting a biometric access system they now have the one key that cannot be lost, stolen, forged or hacked - the human fingerprint".

China Asks Web Sites to Eradicate Porn and Violence

China has called on domestic Web sites to sign a voluntary pact governing online video and audio content, saying they should exercise self-censorship to ensure a "healthy and orderly" cyberspace.

The move is part of government efforts to exert greater control over China's rapidly growing Internet sector, and to prevent content deemed harmful or subversive from getting into the public domain.

Eight "central" Web sites on Friday signed the pact requiring them to eradicate pornography and violence, which had "seriously polluted the online environment and affected the growth of young people", the national broadcast watchdog said.

"The signatories should actively disseminate healthy, beneficial audio-visual programmes meeting socialist moral norms," reads the text of the pact drafted by the State Administration of Radio, Film and Television.

"Decadent, backward thoughts and culture must be boycotted by all," according to a copy of the pact posted on the administration's Web site (www.sarft.gov.cn). Content related to gambling and "horror" were also targeted.

Signatories so far included the sites of official news agency Xinhua, Communist Party mouthpiece the People's Daily and other state media organisations.

China has seen robust growth of its Internet population -- 210 million by the end of 2007 -- in the past decade, fostering a dynamic, diverse and sometimes vulgar cyberspace which often defies the more puritanical official culture.

The Ministry of Information Industry unveiled new rules on online video and audio content banning violent, pornographic and fake material late last year.

The rules stipulate that Web sites offering broadcast or streaming services should be run by state-invested bodies. Sites that have a clean record would be able to reapply for independent operating licences.

The pact asked Web sites to use an online database (net.tv.cn) set up by the watchdog where there was a pool of recommended "excellent" audio-visual programmes and a list of illegal content that must be avoided.

Web sites were also obliged to delete improper content uploaded by ordinary Internet users and to protect intellectual property, according to the pact.

(Reporting by Guo Shipeng and Ben Blanchard; Editing by David Fogarty)

Penis Artist Enters Himself for Prize

'Pricasso', the Aussie artist who uses his penis as a brush, has entered a racy self-portrait for Australia's top art prize.

Tim Patch, who calls himself Pricasso, usually exposes his talents at sex product fairs around the world, but has decided to go upmarket by entering a painting for Australia's Archibald Prize - the nation's top award for portraiture.

In a unique painting style, Patch does not use paint brushes but rather his penis to apply paint to the canvas.

'I had to use my bum to paint in the background, because you have to have the occasional break,' Patch told the Sydney Morning Herald newspaper on Wednesday.

Patch entered a painting of a plastic surgeon in last year's Archibald Prize, but failed to impress the judges. This year's entry depicts a nude Patch, wearing only a hat, holding a blank canvas to hide his 'brush'.

The Art Gallery of New South Wales in Sydney expects up to 700 portraits to be entered for the 2008 Archibald Prize, with the finalists to be announced in March.

A Journey Shaped by a Guitar
Peter Gerstenzang

EVEN though Nazareth, Pa., isn’t quite the holy city its namesake is, pilgrims with a musical bent still go there every weekday in search of a potentially spiritual experience. They head to a quaint brick building, lured by the promise of taking a tour at the C. F. Martin & Company guitar factory.

More than 200 guitars are made at Martin each day, many more than when the company first opened in New York City in 1833 (it moved to Nazareth in 1839). But for any guitar player or music lover, getting to see the basic stages in the creation of a Martin moves them powerfully, putting some in touch with emotions they might have thought too inaccessible to be reached.

Martins are arguably the most coveted acoustic guitar on earth — satisfied customers include Bob Dylan, Neil Young and Freedy Johnston — and wherever pickers and grinners gather to resurrect time-honored chestnuts, from “Helpless” to “Sugarfoot Rag,” there’s a good chance that there will be a Martin chiming in. A trip to the factory could almost be considered a journey to the Lourdes of twang.

Given Martin’s humble origins, today’s factory is surprisingly large and modern, built in 1964. The barn-red Martin building replicates the facade of the first Nazareth factory, but from the outside it looks to be playing host-victim to an industrial plant large enough to churn out cars and trucks.

Inside, the Plek fret-dressing machine hums, lathes turn and sanders buzz as instruments are made in large numbers (81,000 last year). Plus, there’s a spanking clean lobby, a gift shop, a guitar museum and a sparkling white bathroom that pipes in, fittingly enough, a bluegrass radio station.

The tour itself also makes use of modern headsets, so you can hear the guide’s narrative above the impressive whine of guitars being birthed. But once the pilgrims make their way and start seeing guitars in various stages of completion, that holy look creeps back into their eyes. Sometimes, mixed with tears.

That was the case last October with Beverly Goskowski, from nearby Hellertown, whose horn-rims showed a studious side, but whose leather jacket whispered, “rebel.” Ms. Goskowski really did think of her trip to Nazareth and Martin as something, well, related to the soul.

“I came here seven years ago with my granddad,” she said. “He passed over the summer, and I guess I’m trying to recapture the fun we had when we first came. Or to say goodbye to him. I don’t know which, really.”

Ms. Goskowski said all this in a strangely amplified voice mangled by the headset. She wept a bit, removed her glasses, wiped her eyes and chuckled at the tender moment being distorted by a modern contraption.

“Granddad, whose name was George H. Giltenboth, didn’t play an instrument or anything, but he loved music,” she said. “When we went on the tour, he kept grabbing the tour guide’s arm, asking her to repeat certain facts, always calling her ‘honey,’ or ‘dear.’ He loved being here.”

THE tour guide on this day, a careworn but cheerful woman named Steph Tashner, who started here “11 years ago in the stringing department,” took the group of eight, mostly guitar geeks, on a sort of fast-forwarded version of the making of a Martin. The tour started with discussions and descriptions of types of wood — the tops are usually made with spruce, the sides and backs with mahogany and rosewood — and ended with a look at a few finished instruments.

In between, the faithful watched Martin employees soak wood so it could be bent into the sides of guitars; use clothespins to glue the interior linings; smooth frets; and stain bodies.

The employees number 560, ranging in appearance from old hippies with graying ponytails to women who would have fit right into a factory scene from “Norma Rae.” The once little company, which produced 368 guitars in 1898, now covers 200,000 square feet.

Covering the walls are pictures of some of its best-known customers, including Dylan, Young, Stephen Stills and Robbie Robertson. The 60s just might have been less groovy without Martin guitars.

Prices for the factory-made guitars range from $299 to many thousands of dollars. The most popular Martin model, the D-28, retails for $2,849. And Martin still makes custom guitars that can cost more than $100,000.

It’s also possible to take a guitar there for repairs. That was why Jeffrey Lyons, a Toronto musician, was there.

“The action on the fretboard of my D-28 is higher than I’d like,” Mr. Lyons said. “The guitar is buzzing too much when I play gigs. So, I thought, I’d bring the ax down here to have them fine-tune it, leave it and then take the tour.

“Aside from that problem, though, the guitar is great. It has a really bright and consistent tone, and it’s particularly good for ballads.”

Underscoring Mr. Lyons’s decision to bring in his imperfect guitar is a display on a wall near one of the factory’s many workstations. There are bits and pieces of broken Martins glued there, surrounded by the words “Don’t Let This Happen To You!”

Ms. Tashner nodded at the display and at Mr. Lyons. “We don’t recommend that you fix your guitar yourself,” she said with a wry smile.

Near the end of the tour it was also possible to see how technology had changed even the wooden-guitar industry. Behind a glass window, a long mechanical arm could be seen polishing the body of a nearly finished guitar.

“Yes, sometimes we have a robot do the work here,” Ms. Tashner said. “Not only does it do a great job, but it is smart, ergonomically speaking. Better that a robot arm hold up and polish a guitar all day than a human one.”

She didn’t say, though, whether it could play a Lester Flatt G-run.

HEADPHONES were collected and the pickers in the group assembled in the room where several sample Martins were available to play. Ms. Goskowski lingered there, still thinking about her grandfather.

Her cousin Scott Honeychurch, a Southerner wearing a black cowboy hat and boots, picked up a guitar. Almost on cue, as Ms. Goskowski started her story again, Mr. Honeychurch began playing random country licks that evolved into “Wabash Cannonball,” a perfect bit of scoring for Ms. Goskowski’s tale.

“The first time I came here with my granddad, seven years ago, was right after my grandmother, his wife, died,” she said. “Granddad wasn’t much for socializing or leaving the house, and I thought this would be a good place to start the process. Especially since he loved music so much.

“I think he started feeling better about things just after he came on the tour. After that, he started accepting invitations to people’s houses for dinner and, little by little, enjoying life again. I credit this place, in some small way, with keeping him alive.”

“So,” she added, “I think I’m going to do this every once in a while. Make my pilgrimage to the Martin factory and take the tour. It’s the best way I can think of to celebrate Granddad’s life.”

A Wild Welcome to a German Teen-Pop Band
Kelefa Sanneh

If you had found yourself on Irving Place on Monday afternoon you might have noticed a few hundred amped-up fans — mainly young, almost exclusively female — standing in line. And you might have wondered what was going on.

And if you had shown up at the Fillmore New York at Irving Plaza a few hours later for the concert that drew such an eager crowd ... well, you might still have wondered what was going on.

The occasion was the first New York performance by Tokio Hotel, a German act that scrambles musical categories in a way that feels ideally suited to the current era. Why shouldn’t fans go nuts for a goth-punk boy band influenced by the darkly theatrical love songs of HIM (from Finland) and AFI (from California) and led by a sexy androgyne with spectacular hair? Why shouldn’t the members of Tokio Hotel be given a chance to bring their not-quite-idiomatic refrains — “We are here tonight/Leave the world aside” — to the United States?

Now they have that chance. In April they plan to release their first American album, “Scream” (Cherrytree/Interscope). And their Monday performance was one of a few concerts — including one in Los Angeles last Friday — designed to introduce the band in this country. (Tokio Hotel regularly tops the charts in Germany and has had hits throughout Europe.) On Monday night no introduction was needed; most of those fans had already discovered the band online.

To watch Tokio Hotel live is to gaze at that gender-bending singer, who answers to the disappointingly unglamorous name of Bill Kaulitz. He is 18, and he looks like an anime version of Christian Siriano, the precocious star of this season’s “Project Runway.”

In his soft, pleading voice you can hear some of the complications of life as a teen idol: to his fans he’s not only a sex symbol but also a potential confidant and maybe a role model; he is an intermediate figure, standing between the girls in the crowd and the men in the band. But compared with Mr. Kaulitz, those band members (including his identical but very differently styled twin, Tom Kaulitz) couldn’t help but seem underwhelming. As they trudged, sometimes clumsily, through a short set, they seemed a lot less sophisticated than the skinny guy in front, who looks as if he has been honing his stage act since birth. If this concert was oddly delightful from start to finish, thank Bill Kaulitz, who should, with any luck, be thrilling and perplexing young Americans for the rest of the year.

During the best songs — like “Monsoon,” one of the band’s biggest hits — the contrast between singer and band was charming. “Monsoon” is effective because it’s surprisingly restrained: the music stays quiet, and the band doesn’t really kick in until after the second chorus. And when the noise finally came, there was a pleasing sense of devolution, as a teen-pop juggernaut with eyes on an American prize regressed into an exuberant garage band, making a gleeful racket.
JackSpratts is offline   Reply With Quote
Old 20-02-08, 09:58 AM   #2
JackSpratts's Avatar
Join Date: May 2001
Location: New England
Posts: 9,854

5 Years After a Nightclub Fire, Survivors Struggle
Abby Goodnough

Savagely burned in the fire that incinerated the Station nightclub here five years ago next Wednesday, Linda Fisher has endured a dozen surgeries to salvage her arms, her hands, her face.

Ms. Fisher inhaled so much smoke that anguishing night that even now, she gets winded carrying a basket of laundry. Her thick scars keep her from sweating normally, and she has trouble distinguishing hot from cold.

Ms. Fisher feels lucky.

“There are survivors who have no ears, eyes, nose, hair,” she said.

But, like so many others who escaped the inferno, she also simmers with darker emotions.

The survivors are still waiting for their lawsuit against the Station owners and dozens of other defendants, the largest civil tort case in Rhode Island history, to play out in federal court. Many remain furious that one of the club’s owners was sentenced to community service and the other is expected to leave prison next year.

They also feel forgotten. At first, all kinds of help poured in for the roughly 200 injured survivors and families of 100 others who died in the disaster, one of the worst nightclub fires in the nation’s history. But that help has all but disappeared, even though many of the injured face more surgeries, cannot resume full-time work, and struggle to afford heating oil and other basics.

“People that were making $30,000, $40,000 a year had to take jobs making eight bucks an hour because they are so physically challenged,” said Todd King, a survivor who lives and works in North Carolina now and runs the Station Family Fund, a grass-roots nonprofit group that still raises money for the worst-off victims. “They can barely use their hands, and they’re exhausted all the time because their bodies have been put through war.”

Mr. King’s fund has run dry three times in recent years and now has $82,000 — enough to help the neediest survivors for about six months, he said. He is hoping that the fifth anniversary of the fire, on Feb. 20, will elicit more support, but he and other survivors have their doubts.

“Most people don’t understand that a burn injury is a life injury,” said Ms. Fisher, 38, who gets a Social Security disability payment of about $1,000 a month. “If they think about us at all, it’s probably, ‘They must be all better, so why aren’t they back to work?’ ”

Many believe the circumstances of their misfortune — that they were blue-collar folks gathered in a scruffy club to hear Great White, a has-been “hair metal” band from the ’80s — also help explain the lack of interest. The fire ignited when the band’s tour manager lit pyrotechnics on a small stage surrounded by highly flammable foam used as soundproofing.

“We were waitresses, house painters, contractors, strippers,” said Victoria Eagan, who escaped the fire with minor injuries but whose two best friends were badly burned. “If it had been people at the opera that night, there would have been a big difference.”

So far, tickets are selling poorly for a concert to benefit the Station Family Fund, planned for Feb. 25 in Providence. Dee Snider, the lead singer for the band Twisted Sister and the concert’s host, said country and Christian rock performers would join metal bands onstage to broaden the cause’s appeal.

“I’ve tried to get this away from being about hair bands, about heavy metal, and to make this a people issue,” Mr. Snider said. “Since nobody else is going to do it, it’s got to be musicians, all kinds of musicians, taking care of their own and reminding people this could have happened to anyone.”

Donovan Williams, a survivor who was burned over 70 percent of his body and was left legally blind, said he was counting on settlements from the lawsuit to really help people move on. Mr. Williams, who works in telephone sales, needs a ride to his job and cannot do quotidian things like opening jars and tying shoes.

“I’m all for moving on,” said Mr. Williams, 37, who spent 10 weeks in a coma and says he now sees as if looking through sunglasses with Vaseline on them. “The only thing I want is one of those huge TVs.”

A handful of defendants have settled, offering a tentative total of about $71.5 million. But with 300 plaintiffs and hefty lawyer fees, even a huge payout may not guarantee permanent comfort.

Ms. Eagan guessed that at most, an eventual settlement would help survivors and spouses of the dead — there are 23, and 65 children who lost one or both parents — to pay off their mortgages and provide for their families, even if they cannot resume work.
“I don’t think anyone is going to be made a millionaire and drive a Mercedes,” she said.

Two funds administered by the United Way and the Rhode Island Foundation raised almost $3.8 million for victims of the fire and their families, but gave out most early on. The state’s Crime Victim Compensation Program awarded grants averaging $8,800 to 222 claimants after the fire, but the government provided little else. A state request for federal disaster relief was denied on grounds that the fire did not meet the definition of a natural disaster.

Mr. King, Ms. Eagan and several other survivors started the Station Family Fund a few months after the fire, when they learned that one woman who escaped that night was losing her home. They sold thousands of shirts, held car washes, collected change outside grocery stores and organized benefit concerts, raising about $1 million over the last five years.

The group came under attack for accepting about $100,000 from Great White early on, with some survivors and relatives of the dead calling it blood money. The surviving band members — one died that night — are named in the lawsuit, but some, including Ms. Fisher, do not hold them responsible.

A longtime fan, she went to Pennsylvania to see the band perform again eight months after the fire and ended up joining the lead singer, Jack Russell, on stage. She wore a spaghetti-strap top so he could see her scars. Other disfigured survivors avoid going out in public, Ms. Fisher said, but she decided early on not to avoid the inevitable stares.

“I didn’t survive to sit home on the couch and cry,” she said.

On the anniversary of the fire, Ms. Fisher and other survivors will gather at a restaurant across from the former Station site, where a circle of ragged crosses form a makeshift memorial to the dead. Meanwhile, Ms. Fisher and Ms. Eagan are brainstorming about how to draw more support.

“We’ve been kicking around the idea of a black-tie ball, maybe at the Biltmore,” Ms. Fisher said, referring to the fanciest hotel in Providence. “A lot of the blue collar, average people who’ve already dipped into their pockets time and time again — you can only give so much.”

Autism Breakthrough: Girl's Writings Explain Her Behavior and Feelings

Doctors Amazed by Carly Fleishman's Ability to Describe the Disorder From the Inside
John McKenzie

Carly Fleischman has severe autism and is unable to speak a word. But thanks to years of expensive and intensive therapy, this 13-year-old has made a remarkable breakthrough.

Two years ago, working with pictures and symbols on a computer keyboard, she started typing and spelling out words. The computer became her voice.

"All of a sudden these words started to pour out of her, and it was an exciting moment because we didn't realize she had all these words," said speech pathologist Barbara Nash. "It was one of those moments in my career that I'll never forget."

Then Carly began opening up, describing what it was like to have autism and why she makes odd noises or why she hits herself.

"It feels like my legs are on first and a million ants are crawling up my arms," Carly said through the computer.

Carly writes about her frustrations with her siblings, how she understands their jokes and asks when can she go on a date.

"We were stunned," Carly's father Arthur Fleischmann said. "We realized inside was an articulate, intelligent, emotive person that we had never met. This was unbelievable because it opened up a whole new way of looking at her." This is what Carly wants people to know about autism.

"It is hard to be autistic because no one understands me. People look at me and assume I am dumb because I can't talk or I act differently than them. I think people get scared with things that look or seem different than them." "Laypeople would have assumed she was mentally retarded or cognitively impaired. Even professionals labelled her as moderately to severely cognitively impaired. In the old days you would say mentally retarded, which means low IQ and low promise and low potential," Arthur Fleischman said.

Therapists say the key lesson from Carly's story is for families to never give up and to be ever creative in helping children with autism find their voice.

"If we had done what so many people told us to do years ago, we wouldn't have the child we have today. We would have written her off. We would have assumed the worst. We would have never seen how she could write these things how articulate she is, how intelligent she is," the grateful father added.

"I asked Carly to come to my work to talk to speech pathologists and other therapists about autism," said Nash. "What would you like to tell them? She wrote, 'I would tell them never to give up on the children that they work with.' That kind of summed it up."

Carly had another message for people who don't understand autism.

"Autism is hard because you want to act one way, but you can't always do that. It's sad that sometimes people don't know that sometimes I can't stop myself and they get mad at me. If I could tell people one thing about autism it would be that I don't want to be this way. But I am, so don't be mad. Be understanding."

Enclosed, But not Encrypted
Christiane Rütten

Cracking a crypto hard drive case

A new generation of inexpensive disk drive enclosures using hardware encryption and RFID keys do not fulfil the promises of their publicity. The adverts claim 128-bit AES hardware encryption, but they don't tell us how it is used.

The specifications of the 2.5in. Easy Nova Data Box PRO-25UE RFID[1] hard drive case by German vendor Drecom sound promising: hardware data encryption with 128-bit AES, access control via an RFID chip compact enough to carry around on your key ring and optional 160GB or 250GB hard disk capacity. Swiping the RFID chip along the case causes the integrated Innmax IM7206 crypto controller to reveal the drive as a USB 2.0 mass storage compatible device to the attached computer. This works under Linux and Mac OS X as well as Windows. There's no need for special drivers.

Look a little closer, and things don't look so good. Heise online's sister publication c't magazine has discovered that the encryption offered by this product was weak, and erroneously advertised as including "128-bit AES hardware data encryption". c't has since spoken with the manufacturers involved and can confirm that the encryption weakness discovered probably affects numerous similar products.

The first step in our analysis was visual inspection of the encrypted data on the medium. We began by taking out the included Samsung hard drive and connecting it to a normal USB SATA adapter. We immediately noticed that all sectors not overwritten by the partition table and FAT32 formatting were still full of the zero bytes the hard drive contained when shipped. While this does not represent a major cryptographic flaw, it does at least give attackers a rough idea of the volume of encrypted data on the hard drive.

Ideally, encrypted data should look like a random sequence. A phase-space plot helps us quickly determine the pseudo-randomness of data and hence the relative encryption quality of a given data volume. For a three-dimensional phase-space plot, the sequence a, b, c, d, e, f, etc. can be used as space coordinates (a-b, b-c, c-d), (b-c, c-d, d-e), (c-d, d-e, e-f), etc. Patterns in the plot created reveal recurring relations between subsequent sequences. In this phase plot, 50,000 16-bit random numbers would produce an unstructured cloud of dots.

Since some 30 per cent of the first 100kB of the encrypted hard drive are zeros, we can expect a third of these dots to be found on the plot's origin. The remaining two thirds at least should be distributed randomly across the plot if properly encrypted. Unfortunately, the distribution is anything but even:

A large part of the 35,000 non-zeros, which we would expect to find randomly distributed, are clumped together in four groups on the plot. If we take a closer look at the individual sectors in a hex editor, we find the same sequences repeated
00008e00 77 c8 54 35 ee 90 a9 6a dc 21 53 d5 7d 43 a6 aa |w.T5...j.!S.}C..|
00008e10 3f 86 4c 55 7e 0c 99 aa 39 18 32 55 72 30 64 aa |?.LU~...9.2Ur0d.|
00008fe0 fd 76 00 20 fa ed 00 40 f4 db 01 80 2d b7 03 00 |.v. ...@....-...|
00008ff0 5a 6e 07 00 b4 dc 0e 00 68 b9 1d 00 d0 72 3b 00 |Zn......h....r;.|

popping up in the following 512-byte block (200 hexadecimal):
00009000 77 c8 54 35 ee 90 a9 6a dc 21 53 d5 7d 43 a6 aa |w.T5...j.!S.}C..|
00009010 3f 86 4c 55 7e 0c 99 aa 39 18 32 55 72 30 64 aa |?.LU~...9.2Ur0d.|
000091e0 fd 76 00 20 fa ed 00 40 f4 db 01 80 2d b7 03 00 |.v. ...@....-...|
000091f0 5a 6e 07 00 b4 dc 0e 00 68 b9 1d 00 d0 72 3b 00 |Zn......h....r;.|

And again:
00009200 77 c8 54 35 ee 90 a9 6a dc 21 53 d5 7d 43 a6 aa |w.T5...j.!S.}C..|
00009210 3f 86 4c 55 7e 0c 99 aa 39 18 32 55 72 30 64 aa |?.LU~...9.2Ur0d.|
000093c0 4d 00 20 59 9a 00 40 b2 f1 01 80 64 e2 03 00 c9 |M. Y..@....d....|
000093d0 01 07 00 92 c7 0e 00 24 8e 1d 00 48 1c 3b 00 90 |.......$...H.;..|

And again:
00009400 77 c8 54 35 ee 90 a9 6a dc 21 53 d5 7d 43 a6 aa |w.T5...j.!S.}C..|
00009410 3f 86 4c 55 7e 0c 99 aa 39 18 32 55 72 30 64 aa |?.LU~...9.2Ur0d.|
000095e0 fd 76 00 20 fa ed 00 40 f4 db 01 80 2d b7 03 00 |.v. ...@....-...|
000095f0 5a 6e 07 00 b4 dc 0e 00 68 b9 1d 00 d0 72 3b 00 |Zn......h....r;.|

These regular repetitions continued, and the almost identical columns of numbers suggest that the 512-byte sectors of your drive are not in fact encrypted with AES, but merely with a constant 512-byte cipher block applied as an XOR (exclusive OR).

In contrast to the missing preformat of the entire disk, an XOR with an unchanging cipher block does represent a major cryptographic flaw – in fact, the open kind of flaw that, used in this way, is susceptible to what are known as "known plain-text attacks". XOR encryption works like this:

Ciphertext1 = plaintext1 XOR cipher block(key 1)
Ciphertext2 = plaintext2 XOR cipher block(key 2)
Ciphertext3 = plaintext3 XOR cipher block(key 3)

The same operations are used for decryption, only with the role of plaintext and ciphertext reversed:

Plaintextn = ciphertextn XOR cipher block(key n)

When the cipher block is the same for every sector, as above, the result is:

cipher block(key) = ciphertextn XOR plaintextn

for any block n. In other words, you only need to find a 512-byte sector with known plaintext to calculate the universal cipher block. Such attacks are therefore called "known plaintext attacks." To make matters worse, sector 67 consists almost completely of zeros if the first partition is formatted with FAT32:
00008400 00 00 00 00 00 00 00 00 00 00 00 00 00 00 00 00 |................|
00008410 00 00 00 00 00 00 00 00 00 00 00 00 00 00 00 00 |................|
00008420 00 00 00 00 00 00 00 00 00 00 00 00 00 00 00 00 |................|
000085d0 00 00 00 00 00 00 00 00 00 00 00 00 00 00 00 00 |................|
000085e0 00 00 00 00 00 00 00 00 00 00 00 00 00 00 00 00 |................|
000085f0 00 00 00 00 00 00 00 00 00 00 00 00 00 00 55 aa |..............U.|

As a result, you can get almost the entire encryption cipher just by reading sector 67 from the encrypted drive – after all:

cipher block(key) = ciphertextn XOR 0 = cipher block n

So if you take the output of: dd if=/dev/sdc bs=512 count=1 skip=67 | hexdump -vC, you have almost the entire 512-byte block you are looking for:
00008400 77 c8 54 35 ee 90 a9 6a dc 21 53 d5 7d 43 a6 aa |w.T5...j.!S.}C..|
00008410 3f 86 4c 55 7e 0c 99 aa 39 18 32 55 72 30 64 aa |?.LU~...9.2Ur0d.|
00008420 21 60 c8 54 42 c0 90 a9 41 80 21 53 82 00 43 a6 |!`.TB...A.!S..C.|
000085d0 01 07 00 92 c7 0e 00 24 8e 1d 00 48 1c 3b 00 90 |.......$...H.;..|
000085e0 fd 76 00 20 fa ed 00 40 f4 db 01 80 2d b7 03 00 |.v. ...@....-...|
000085f0 5a 6e 07 00 b4 dc 0e 00 68 b9 1d 00 d0 72 6e aa |Zn......h....rn.|

But we still don't have the last two bytes 6e aa right, which have to be XORed with 55 aa to produce the final result 3b 00. Now we know the entire 512-byte encryption cipher, which we can use to decrypt all other hard drive sectors.

Who would have expected that decryption would be so easy? Indeed, the bar is so low that even novice attackers will have no trouble getting over it. When decryption is possible at the lowest block level, any possible security provided by the RFID chip becomes completely worthless, so we didn't conduct any further tests.

heise Security has since received a statement from Innmax, the manufacturer of the IM7206[2] controller chip used, confirming our findings. The IN7206 merely uses AES encryption when saving the RFID chip's ID in the controller's flash memory. The company explained that actual data encryption is based on a proprietary algorithm. The company claims the IM7206 only offers basic protection and is designed for "general purpose" users. In contrast, the more expensive IM8202 controller chip is being designed for users with greater security requirements; they claim it will offer true 128-bit AES encryption for data – but the chip is still in the development phase.

Hard drive enclosure manufacturer Drecom also confirmed our findings and is busy working on a solution. Easy Nova product manager Holger Henke says that the improper label "128-bit AES Hardware Data Encryption" for Data Box PRO-25SUE was the result of Innmax's misleading formulation of its controller specifications. Henke says that a new Easy Nova case could be released by the end of the year with the improved IM8202 controller. For the time being, the company says it will continue to market the current module as providing "simple encryption."

The Easy Nova product isn't the only hard drive enclosure on the market that uses the IM7206. You should assume that other products based on the controller also suffer from the same flawed encryption. The following crypto hard drive enclosures also use the IM7206 and are therefore likely to be vulnerable to the same attacks:

STYSEN E08 RFID Security Mobile Disk [3]
DoTop RFID SATA to USB storage[4]
Agestar RFID Security External Enclosure SRB2A[5]
Silverstone Treasure TS01B[6]
Sharkoon Swift-Case Securita[7]

These manufacturers have been alerted, but we have yet to receive replies from them.

URL of this article:

Links in this article:
[1] http://www.easy-nova.de/index.php?si...8&productID=28
[2] http://www.innmax.com/en/im7206.html
[3] http://www.stysen.com/eng/product/pr...id=1&sub_id=35
[4] http://www.dotop.com/dotop/en/produc...il.php?p_id=59
[5] http://www.agestar.com/english/products/srb2a.asp
[6] http://silverstonetek.com/products/p...s.php?pno=ts01
[7] http://www.sharkoon.com/html/produkt...ita/index.html

A Method for Critical Data Theft

John Markoff

A group led by a Princeton University computer security researcher has developed a simple method to steal encrypted information stored on computer hard disks.

The technique, which could undermine security software protecting critical data on computers, is as easy as chilling a computer memory chip with a blast of frigid air from a can of dust remover. Encryption software is widely used by companies and government agencies, notably in portable computers that are especially susceptible to theft.

The development, which was described on the group’s Web site Thursday, could also have implications for the protection of encrypted personal data from prosecutors.

The move, which cannot be carried out remotely, exploits a little-known vulnerability of the dynamic random access, or DRAM, chip. Those chips temporarily hold data, including the keys to modern data-scrambling algorithms. When the computer’s electrical power is shut off, the data, including the keys, is supposed to disappear.

In a technical paper that was published Thursday on the Web site of Princeton’s Center for Information Technology Policy, the group demonstrated that standard memory chips actually retain their data for seconds or even minutes after power is cut off.

When the chips were chilled using an inexpensive can of air, the data was frozen in place, permitting the researchers to easily read the keys — long strings of ones and zeros — out of the chip’s memory.

“Cool the chips in liquid nitrogen (-196 °C) and they hold their state for hours at least, without any power,” Edward W. Felten, a Princeton computer scientist, wrote in a Web posting. “Just put the chips back into a machine and you can read out their contents.”

The researchers used special pattern-recognition software of their own to identify security keys among the millions or even billions of pieces of data on the memory chip.

“We think this is pretty serious to the extent people are relying on file protection,” Mr. Felten said.

The team, which included five graduate students led by Mr. Felten and three independent technical experts, said they did not know if such an attack capability would compromise government computer information because details of how classified computer data is protected are not publicly available.

Officials at the Department of Homeland Security, which paid for a portion of the research, did not return repeated calls for comment.

The researchers also said they had not explored disk encryption protection systems as now built into some commercial disk drives.

But they said they had proved that so-called Trusted Computing hardware, an industry standard approach that has been heralded as significantly increasing the security of modern personal computers, does not appear to stop the potential attacks.

A number of computer security experts said the research results were an indication that assertions of robust computer security should be regarded with caution.

“This is just another example of how things aren’t quite what they seem when people tell you things are secure,” said Peter Neumann, a security researcher at SRI International in Menlo Park, Calif.

The Princeton researchers wrote that they were able to compromise encrypted information stored using special utilities in the Windows, Macintosh and Linux operating systems.

Apple has had a FileVault disk encryption feature as an option in its OS X operating system since 2003. Microsoft added file encryption last year with BitLocker features in its Windows Vista operating system. The programs both use the federal government’s certified Advanced Encryption System algorithm to scramble data as it is read from and written to a computer hard disk. But both programs leave the keys in computer memory in an unencrypted form.

“The software world tends not to think about these issues,” said Matt Blaze, an associate professor of computer and information science at the University of Pennsylvania. “We tend to make assumptions about the hardware. When we find out that those assumptions are wrong, we’re in trouble.”

Both of the software publishers said they ship their operating systems with the file encryption turned off. It is then up to the customer to turn on the feature.

Executives of Microsoft said BitLocker has a range of protection options that they referred to as “good, better and best.”

Austin Wilson, director of Windows product management security at Microsoft, said the company recommended that BitLocker be used in some cases with additional hardware security. That might include either a special U.S.B. hardware key, or a secure identification card that generates an additional key string.

The Princeton researchers acknowledged that in these advanced modes, BitLocker encrypted data could not be accessed using the vulnerability they discovered.

An Apple spokeswoman said that the security of the FileVault system could also be enhanced by using a secure card to add to the strength of the key.

The researchers said they began exploring the utilities for vulnerabilities last fall after seeing a reference to the persistence of data in memory in a technical paper written by computer scientists at Stanford in 2005.

The Princeton group included Seth D. Schoen of the Electronic Frontier Foundation, William Paul of Wind River Systems and Jacob Appelbaum, an independent computer security researcher.

The issue of protecting information with disk encryption technology became prominent recently in a criminal case involving a Canadian citizen who late in 2006 was stopped by United States customs agents who said they had found child pornography on his computer.

When the agents tried to examine the machine later, they discovered that the data was protected by encryption. The suspect has refused to divulge his password. A federal agent testified in court that the only way to determine the password otherwise would be with a password guessing program, which could take years.

A federal magistrate ruled recently that forcing the suspect to disclose the password would be unconstitutional.

Face Value
Barbara Fister

My corner of the Internet has been abuzz over a muckraking article that recently appeared in The Guardian on the subject of Facebook. Tom Hodgkinson, the highly principled slacker behind The Idler and author of How to Be Free, makes some familiar complaints: online friends are a pale imitation of face-to-face relationships, Facebook encourages high-schoolish obsession with popularity, it prompts its members to reveal too much about themselves, and it uses that information for commercial gain. But the article goes further. Facebook is not just an American-owned company with global ambitions. According to Hodgkinson, it’s highly influenced by a “neocon activist” board member and funded by a venture capital firm that has ties to the CIA. Their ultimate aim: “an arid global virtual republic, where your own self and your relationships with your friends are converted into commodities on sale to giant global brands.”

Ironically, The Guardian helpfully provides a “share” link so you can send the article to all of your Facebook friends.

One of the most interesting responses to this article bubbled up on A-Librarians, a forum for anarchist and radical librarians. (Yes, I am, in case you’re wondering. And “anarchist librarian” is not an oxymoron. Look it up.) While other lists were debating whether the article’s claims were credible, or whether Facebook is valuable regardless, the members of this list were getting down to philosophical basics. Why does the concept of property so thoroughly infuse our understanding of rights? Are our conceptions of privacy dependent on owning one’s individual “self”? If we own our identity, is our public persona a form of intellectual property, as a trademark is?

I don’t know the answers to those questions, which relate not only to Facebook, but the debates over Google’s project to digitize great university library collections, and the fights over access to journal articles written by professors whose institutions can’t afford to gain access to them. But as a librarian who is in favor of sharing ideas freely, these debates made me rethink the fundamental relationship between the individual’s desire to share their thoughts and experiences with others and the commercial entities that provide the distribution channel for that act of sharing. It seems to me the crux of the problem is that the profit motive influences both sides of the equation – differently.

Corporations like Google and Facebook are worth a lot of money, which is a bit odd. They don’t create their content, and what’s there, they give away for free. They mediate the space where we go to express ourselves, and where find out what others think. Sure, we have to put up with a bit of advertising, but that’s just a minor irritant for something that’s free.

But there is a cost.

These corporations provide us with a space to play, engage with others, and make connections. We get to build our own identities in a public way. In return, we give them (perhaps without realizing it) a panopticon view of our lives, a chance to gather data on what we think, do, read, say, enjoy, and with whom we associate — our “communities of interest” in the parlance of the FBI, or “friends” in Facebook’s lexicon. It’s exceedingly valuable information because it can be sold to companies who want to follow trends and focus their advertising dollars on just those individuals most likely to respond. The more people involved, the more valuable the data.

The terms of this contract are never quite clear. The Facebook Terms of Use explain we’re allowing these companies to keep track of what we enter into these systems (our searches, the words we use in our Gmail messages, our profiles and connections at Facebook), but we can’t be sure exactly how that information gets used, because that’s a trade secret. They could tell us, but then they’d have to kill us.

Facebook embarrassed itself last fall by overestimating our enthusiasm for this exhibitionist social contract. They launched Beacon, a service that would send information about one’s online purchases to a Facebook member’s friends unless an obscure “opt out” box was checked quickly before it disappeared from sight. Their assumption was that everyone would enjoy sharing their shopping lists as much as their playlists — your friend Mike just bought Hanes underwear and thinks you might want to buy some, too! — but that idea hit an invisible barrier of resistance. Whoa, that’s going too far! We got cold feet when the commercial consequences of our sharing was made visible. The outcry, ironically mobilized through Facebook itself, forced them to back off.

But on the whole, the public is content to go along. Just give me a place to express myself to the world, and you can do ... whatever it is you do.

People trust these playful-seeming corporations to not do evil far more than they trust their government. In 2007, an ACLU poll found a majority of the public opposed warrantless wiretapping. Earlier, tens of thousands of people signed petitions opposing the government’s ability to track what they were checking out of libraries or buying at bookstores.

Libraries have always taken privacy seriously – not because it’s valuable in itself, but because it’s a necessary condition for the freedom to read whatever you want without risk of penalty. When the PATRIOT Act was passed, librarians checked to make sure their databases erased the connection between a book and its borrower as soon as the book was returned. That erasure, however, makes it harder to offer the kind of personalization, such as recommendations based on previous book choices, that the public increasingly expects from online systems. After all, it’s what they get from Amazon.

Suspicion of the government does not extend to corporations running the Web 2.0 playground. Those guys just seem so ... nice. And after all, if they give us the tools to tell people we read a good novel or like a particular band, why not let the company make a little money from it?

The complexities of private/public digital tradeoffs have been debated in many different contexts. Siva Vaidhyanathan has questioned why libraries, a public good, should partner with Google, a private corporation, to digitize their contents; aren’t we concerned that Google will control the most complete library in the world? Others defend the practice because – well, without Google’s deep pockets, it simply wouldn’t happen on so vast a scale. Besides, the books go right back on the library’s shelf once digitized. What’s the harm in sharing?

Let’s set aside the contentious copyright issue for the moment and concentrate on why Google is providing “free” resources. Unlike libraries, Google gets content for free, gives it away for free, and makes its money by being an enormous distribution channel for everything from physics research to 19th century scanned books to the latest YouTube video. By watching the traffic through those channels, they are able to provide highly-specific information on who’s interested in what. The more we use Google, the more information they accrue about what we’re using, and the more valuable that mountain of information becomes.

And, let’s face it: we have selfish motives, too. Social networking blurs self-expression and self-promotion. The idea of property and its exchange has so infiltrated our culture as a defining concept that many people do, in fact, think of their public persona as their brand. It’s important to “be out there.” Their lives grow more valuable as more people recognize and acknowledge their ideas, their tastes, and their interests.

This isn’t just a youthful obsession. Facebook has recently opened its service to everyone, regardless of school or college affiliation. A novelist I know was just advised by her agent to set up a Facebook profile to increase her online presence and engage in “relationship marketing” with potential customers. In other words, she’s expected to act as her own sock puppet so she can sell more books. Make friends and influence people.

Here’s the interesting paradox: The only way to increase the intellectual property value of your identity is to give it away. That’s the only way it can be shared, linked to and recognized by others. Trading a little personal information for a public platform, whether for personal expression or self-promotion (or both), seems a fair exchange.

Does this sound eerily familiar? It should.

As scholars, our ideas gain value as we make them public, and we have been historically myopic about the consequences of trading the rights to our ideas for access to distribution channels. This unexamined practice put us all over a barrel when publishers required the academy to ransom those ideas back through prohibitively expensive journal subscriptions for libraries. The personal advancement attached to making our ideas public only added to the problem; more publications translated into higher prestige. There was just too much stuff for libraries to buy back, and not enough budget. The Open Access movement is on track to significantly change the “terms of service” when it comes to scholarly communication. Though the battle’s far from over, we’ve made real progress.

But we’ve barely begun to examine the unintended consequences of the Faustian bargain we strike when we share content through privately-owned digital domains of the public sphere.

Tom Hodgkinson says we have a choice: we can help Facebook’s right-wing investors make a lot of money, or we can simply opt out of “this takeover bid for the world.”

But hold on – it’s our world. And we didn’t approach the problems of scholarly communication by ceasing to publish. We started by educating the community about the consequences and renegotiating the terms of our relationship with publishers.

Scholarly work isn’t the only form of communication worth fighting for. The privately owned digital public sphere is a fertile if febrile commons where millions of people play out their identities and share ideas. The bargains we used to routinely accede to in order to get our research published were easy to ignore because we personally benefitted from them. In fact, we didn’t read the fine print, and we didn’t anticipate the consequences. Something very similar is going on in social networking.

Scholars and librarians champion the value of free and open exchange of ideas for the public good. It’s time to take those values beyond the academy. If we made an effort to help the public understand the tradeoffs we make to be part of the digital social sphere, maybe we’d all think more critically about how our public identities are formed and exploited – for what they are worth.

HBO Agrees To Air ‘Taxi To The Dark Side’ After Discovery Drops It For Being Too ‘Controversial’

Taxi to the Dark Side, a documentary about an innocent Afghan taxi driver tortured to death by U.S. officials at Bagram Air Base, has received wide critical acclaim since its debut in April at the Tribeca Film Festival. The New York Times’s A.O. Scott said, “If recent American history is ever going to be discussed with the necessary clarity and ethical rigor, this film will be essential.”

Earlier this month, ThinkProgress reported that the Discovery Channel broke its contract to broadcast Taxi prior to the 2008 elections. With plans to take the company public, executives were afraid the “film’s controversial content might damage Discovery’s public offering.”

In a press release on Thursday, HBO announced that it has bought the rights to Taxi and will show the film in September 2008. TP reader Tim received a similar response from “Viewer Relations” at Discovery Communications, who said that they may also show the film on cable in 2009:

In its first, pay tv window, HBO will debut the film in September, 2008. We are proud that Taxi to the Dark Side will make its basic cable debut in 2009 on Investigation Discovery, the network dedicated to providing in-depth programs that challenge viewers’ perceptions on important issues shaping our culture and defining our world.
ThinkProgress spoke with an HBO spokeswoman who explained why the network picked up Taxi: “It’s a great film and HBO always goes after high quality docs.”

A source told ThinkProgress that Discovery agreed to the deal with HBO after intense public criticism — including from the netroots. Discovery executives were also reportedly anxious that if Gibney received the Oscar for best documentary feature, he would make a speech denouncing the network.

How convenient for Discovery that it is now willing to show the film on its own channel in 2009…after President Bush is out of office.

Infrared LEDs Make You Invisible to CCTV Cameras

Cory Doctorow

This German exibition is showcasing bright infrared LED devices that overwhelm the CCDs in security cameras, allowing you to move through modern society in relative privacy. I used this as a gimmick in my story I, Robot -- now I want to own one!

The URA / FILOART developed device promises to the citizens of a more reliable protection against security measures of the state (and other Überwachenden).

In addition to monitoring purposes organised systems interaction between man and machine is still IR.ASC an additional interaction between machines dar. This absurd accumulation of technology is symptomatic, because although the entire expense of the protection measures for the alleged safety of citizens is made, the person slips on the importance scale of the current security plan ever deeper down.


Blinding Flashlight Developed as New Law Enforcement Tool

California company, working with DHS funds, develops a blinding flash light which may well replace taser guns, pepper spray, and rubber bullets as law enforcement's non-lethal weapon of choice

Tasers are controversial. Pepper spray may backfire. Rubber bullets are not always effective -- and at times too effective, killing the people they hit. A new weapon under development by DHS may well become the less-than-lethal weapon of choice for law enforcement officers. Baltimore WJZ's Derek Valcourt reports that the device is called LED Incapacitator, and that it is a high-tech flashlight that flashblinds. "This is much different than just shining a bright flashlight in somebody's face," said Bob Lieberman, president of Torrance, California-based Intelligent Optical Systems (IOS), which works on the LED Incapacitator. "It's designed to give the user an advantage over a potential adversary without causing any long-term damage." DHS awarded IOS an $800,000 contract to develop the flashlight technology in hopes that all law enforcement officers would be able to use the weapon to subdue, but not kill, suspects who refuse to follow orders. When shined into someone's eyes, the strobing light disorients and even temporarily blinds them. The effect lasts long enough to give law enforcement officials an upper hand, allowing them to tackle and even handcuff suspects before they can harm anyone.

The device flashes LED lights at several specific frequencies. Before your brain has time to adjust to one frequency, the incapacitator flashes another. Add multiple colors, which the eyes read differently, and the human brain just can not keep up. In fact, if you look at the strobing lights long enough it can make you sick. "The natural human response, they are going to wince or squint or turn their face away," said Commander Sid Hale with the L.A. County Sheriff's Office, who helped the develop the incapacitator. "This is about the safest thing you can find and still be considered some type of force. This is about one step above screaming and yelling at the guy."

DHS officials hope they can outfit Secret Service agents, border patrol, Coast Guard, and air marshals with the devices. "In effect what you are trying to do is get the person to close their eyes and make it hard for them to keep being aggressive and coming at you," DHS's David Throckmorton told Valcourt. "For them it would be to stop a terrorist or whoever from advancing." Throckmorton points out most law enforcement officers already carry flashlights. "You don't want the agents to have to carry multiple devices out there. So you would use this as a replacement. It's dual purpose. It's a flashlight and then when you go into a higher power mode, it will incapacitate people," he said.

Lieberman says the device is safe and will not cause long-term damage to the eyes. "We've been very careful to design this so that the maximum permissible limit for human eye safety is never exceeded," he said. Human trials on the device are expected to begin soon at Pennsylvania State University's Institute of Non-Lethal Defense Technologies. If all goes well, IOS expects the flashlights will be available to the law enforcement community by the fall. The company even hopes a smaller size model will be sold on store shelves for personal security. With its strobe light effect, DHS officials say this less than lethal weapon may even be used one day for crowd control. Larger model lights could be used to stop riots, like the ones in College Park after the University of Maryland basketball games in 2002 and 2006. They could even be mounted on prison walls to stop inmate riots.

Finland Censors Anti-Censorship Site

Calls it child porn
Dan Goodin

Finnish police are blocking more than 1,000 legal websites, including one belonging to a well-known internet activist, under a secretive system designed to prevent access to foreign sites that contain child pornography, according to a group that advocates for individual rights online.

Among the estimated 1,700 destinations on the secret block list is lapsiporno.info, which has vocally criticized the Finnish censorship program, according to Matti Nikki, the site's creator and a long-time activist.

Of the 700 or sites that have been tested, only two are known to contain inappropriate images of children, said Tapani Tarvainen chairman of the Electronic Frontier Finland (EFFI). The remainder tend to be sites with adult-oriented themes, such as those offering legal porn, and forums for gay sex. In some cases, the sites - which include an online doll store, a Thai Windows advice forum and a computer repair service - have no visible link to porn or sex at all.

The program has its roots in a law passed in late 2006 that was narrowly drafted to filter only foreign websites that contained child porn. To critics, the inclusion of sites like Nikki's, which is located in Finland and contains no pornographic images of any kind, demonstrates the slippery slope that gets started once censorship is allowed.

What's more, the censorship system threatens sites that offer all kinds of content, including political forums blogs and message boards. That's because it requires Finnish internet service providers (ISPs) to block entire web servers, so a single user posting a single inappropriate link has the ability to get an entire service shut out. As a result, plenty of legitimate sites based in the US, Europe and elsewhere, are blocked solely because they share space with a bad actor.

"It's a bit harsh for the Finnish police to tag them as child porn, and it certainly will hurt the reputation of these businesses," Nikki wrote in an email to The Register. "To my knowledge, the censored sites haven't been notified by the police about the situation either."

Nikki fights back

Nikki has compiled a list of sites he's found to be blocked. It contains about 1,000 entries, but he says Finnish police have claimed there are about 1,700 addresses in all. Finnish officials refuse to reveal the criteria for an individual site to get added to the list. Even for those sites that learn they are being censored, there is no clear way for owners to get their site to get removed.

In 2005, Nikki attracted international attention when he analyzed the secret digital rights management rootkit that Sony BMG was installing on users' computers. More recently, he's been an outspoken critic of the Finnish government's censorship plan. Last Tuesday, the EFFI says, the Finnish National Bureau of Investigation (NBI) added his site to their list, but has refused to say why.

Three days later, Finnish police said they wanted to question him in connection with an investigation to determine whether he aided in the distribution of material violating sexual chastity.

"Without knowing any details, a good guess is that the police suspect that having a clickable link to a web site allegedly containing child pornographic images is equivalent to aiding the distribution of such images," the EFFI surmised in this blog post on the censoring of Nikki's site.

Officials from the NBI weren't available at the time of writing. Helsingin Sanomat reported here that agency official Lars Henriksson defended the program. He said the list includes sites with content that meets the definition of child pornography, including those with links that lead to such pages.

"This is not censorship", Henriksson told the publication.

The irony of the draconian sweep is how easy it is for the censorship to be circumvented. A simple change to the DNS setting of an operating system or router, in which a Finnish ISP's official internet protocol address is substituted with OpenDNS or another alternate provider, is all that's required to get around the block.

Not that this gives Nikki or people at the EFFI any comfort. They worry that officials are already expanding the reach of the law beyond what was contemplated when it was enacted. How long, they ask, until its used to block sites alleged to promote copyright infringement, gambling or racist views?

Supreme Court Rejects ACLU Challenge to Wiretaps
Nick Juliano

The Supreme Court rejected a challenge to the Bush administration's domestic spying program. However, the justices' decision Tuesday included no comment explaining why they turned down the appeal from the American Civil Liberties Union.

“Although we are deeply disappointed with the Supreme Court’s refusal to review this case, it is worth noting that today’s action says nothing about the case’s merits and does not suggest in any way an endorsement of the lower court’s decision. The court’s unwillingness to act makes it even more important that Congress insist on legislative safeguards that will protect civil liberties without jeopardizing national security," ACLU Legal Director Steven R. Shapiro said in a news release.

The setback comes as Congress spars with President Bush over whether to grant legal immunity to telecommunications companies. The ACLU and other groups say some 40 similar lawsuits pending against the private companies, rather than the government itself, are among the only means of oversight of Bush's warratnless wiretapping program.

“Congress enacted the Foreign Intelligence Surveillance Act intending to protect the rights of U.S. citizens and residents, and the president systematically broke that law over a period of more than five years," said Jameel Jaffer, Director of the ACLU’s National Security Project. "It’s very disturbing that the president’s actions will not be reviewed by the Supreme Court. It shouldn’t be left to executive branch officials alone to determine what limits apply to their own surveillance activities and whether those limits are being honored. Allowing the executive branch to police itself flies in the face of the constitutional system of checks and balances.”

The court said plaintiffs represented by the ACLU could not sue the government because they could not prove their communications had been warrantlessly monitored by the National Security Agency. Shapiro also called it a "Catch-22" scenario because records of who the government spied on were classified.

The ACLU wanted the court to allow a lawsuit by the group and individuals over the warrantless wiretapping program. An appeals court dismissed the suit because the plaintiffs cannot prove their communications have been monitored.

The government has refused to turn over information about the closely guarded program that could reveal who has been under surveillance.

Wiretapping Made Easy
Andy Greenberg

Silently tapping into a private cell phone conversation is no longer a high-tech trick reserved for spies and the FBI. Thanks to the work of two young cyber-security researchers, cellular snooping may be soon be affordable enough for your next-door neighbor.

In a presentation Wednesday at the Black Hat security conference in Washington, D.C., David Hulton and Steve Muller demonstrated a new technique for cracking the encryption used to prevent eavesdropping on GSM cellular signals, the type of radio frequency coding used by major cellular service providers including AT&T, Cingular and T-Mobile. Combined with a radio receiver, the pair say their technique allows an eavesdropper to record a conversation on these networks from miles away and decode it in about half an hour with just $1,000 in computer storage and processing equipment.

Hulton, director of applications for the high-performance computing company Pico, and Muller, a researcher for mobile security firm CellCrypt, plan to make their decryption method free and public. In March, however, they say they'll start selling a faster version that can crack GSM encryption in just 30 seconds, charging between $200,000 and $500,000 for the premium version.

Who will be the customers for their innovative espionage technique? Hulton and Muller say they aren't sure yet. But they plan to offer the method to companies that will integrate it with radio technology, not sell it directly to the law enforcement and criminal customers who will undoubtedly be interested in putting it to use. "We're not creating the technology that does the interception," Muller says. "All this does is crunch data."

Hulton and Muller will likely make a tidy profit from the fruits of their research work, which they've personally patented. The companies they work for may profit less directly; Pico makes the high-performance processors necessary to do heavy-duty encryption work. CellCrypt makes software for encrypting mobile phone conversations, patching the security flaw that Hulton and Muller's research has uncovered.

As for the moral question of chipping away at the privacy of cell phone users around the world, Muller gives an answer common to security researchers: He and Hulton didn't invent the hackable technology; they just brought attention to its vulnerabilities.

In fact, Muller argues, GSM encryption was cracked--theoretically--in academic papers as early as 1998. "Active" radio interceptors, which impersonate cell towers and can eavesdrop on GSM phone conversations, have also been sold by companies like Comstrac and PGIS for years. (Active techniques, however, only allow eavesdropping from within about 600 feet and are easily detectable, Muller notes.) Undetectable, "passive" systems like the one that Muller and Hulton have created aren't new either, though previous technologies required about a million dollars worth of hardware and used a "brute force" tactic that tried 33 million times as many passwords to decrypt a cell signal.

All of that means, Hulton and Muller argue, that their cheaper technique is simply drawing needed attention to a problem that mobile carriers have long ignored--one that well-financed eavesdroppers may have been exploiting for years. "If governments or other people with millions of dollars can listen to your conversations right now, why shouldn't your next-door neighbor?" Muller says.

The new technique may serve as a wake-up call for mobile carriers, which have long been in denial about the vulnerabilities of GSM security, says Bruce Schneier, encryption guru and chief technology officer of BT Counterpane.

"This is a nice piece of work, but it isn't a surprise," he says. " We've been saying that this algorithm is weak for years. The mobile industry kept arguing that the attack was just theoretical. Well, now it's practical."

The GSMA trade association, which represents 700 GSM carriers around the world, didn't respond to a request for comment.

Although their exploit doesn't target the competing CDMA cellular technology used by carriers like Verizon and Sprint Nextel, Muller argues it's not necessarily less secure. GSM was only decrypted first because it's more popular worldwide: Few cell phone subscribers outside North America use CDMA carriers.

So how do Hulton and Muller ensure that their own phone conversations aren't intercepted? Muller responds to that question, posed by an audience member at Black Hat's gathering of hackers and security professionals, with a smile.

"We don't use phones," he says.

U.S. Says Missed Intelligence After Spy Act Expired
Randall Mikkelsen

U.S. spy agencies have missed intelligence in the days since terrorism surveillance legislation expired, the Bush administration said on Friday, but Democrats accused it of fear mongering and blamed it for any gaps.

U.S. Attorney General Michael Mukasey and Director of National Intelligence Michael McConnell fired the latest shot in the administration's battle with Congress to obtain new legislation to wiretap terrorism suspects.

The officials told Congress telecommunications firms have been reluctant to cooperate with new wiretaps since six-month temporary legislation expired last weekend.

"We have lost intelligence information this past week as a direct result of the uncertainty created by Congress' failure to act," the two officials told House of Representatives Intelligence Committee Chairman Silvestre Reyes in a letter.

They urged Reyes, a Texas Democrat, to reconsider his opposition to legislation passed last week by the Senate.

But House Speaker Nancy Pelosi said Republican lawmakers and the administration had failed to participate on Friday in congressional staff negotiations over the bill, and noted President George W. Bush opposed extending the temporary act.

"The president and congressional Republicans have only themselves to blame," for any missed intelligence, said Pelosi, a California Democrat.

The measure passed by the Senate would provide retroactive lawsuit immunity to firms which cooperated with warrantless wiretaps that Bush authorized after the September 11 attacks.

Civil-liberties advocates oppose the immunity provision, and disagreement over the issue led to the collapse of efforts to pass a permanent overhaul of a 1978 surveillance bill that the administration says is obsolete.

Congress passed the temporary law last August in response to urgent administration warnings of gaps in U.S. intelligence capabilities.

The 1978 bill remains in effect, as do one-year wiretap authorizations made under the temporary law. But administration officials say the old bill is dangerously obsolete and their ability to collect new intelligence is hampered.

Mukasey and McConnell gave no details of the missed intelligence. They told Reyes, however, that some communications firms have balked at cooperating out of uncertainty over their legal exposure.

"In particular, they have delayed or refused compliance with our requests to initiate new surveillance of foreign intelligence targets," they said.

Democratic leaders of congressional intelligence and judiciary committees issued a statement that they were committed to passing new legislation and they urged Bush to support an extension of the temporary law.

Senate Majority Leader Harry Reid, a Nevada Democrat, said Bush was "crying wolf."

"No amount of fear mongering will change the fact that our intelligence collection capabilities have not been weakened since last week," Reid said.

(Editing by Sandra Maler)

Reporter Visits Terror Watch List Center, Prevented from Seeing Map of Targets in America
Ryan Singel

National Public Radio correspondent Dina Temple-Raston got the first ever media tour of the Terrorist Screening Center, where 50 analysts follow-up on hits on the nation's sprawling terrorist watch lists, but right as she entered, the TSC shut down the "Big Board" a la Dr. Strangelove.

To get into the small, top-secret room where about 50 analysts from the FBI, Immigration and other agencies work, my escort has to punch a code into a small keypad and pull open a heavy steel door. He announces my presence by shouting a single word: "Uncleared."

With that signal, the flat screens in the cubicles around the room go dark. A giant, interactive map on a pull-down screen at the front of the office space switches to a nondescript picture of the center's logo. Flat screens show high-definition images of flowers and landscapes. Normally, the screen at the front of the office displays a large map of the United States sprinkled with dots, each dot representing the whereabouts of a terrorist or suspected terrorist in the continental United States. If I weren't in the room, it would look like the spy center in the movie Patriot Games.

"We pretty much are the one-stop-shop mechanism for any kind of terrorist encounter," Watch Commander Mike Ross says.

He says the terrorist-locator dots on the map in the room change color depending on how long it has been since a local law enforcement officer called in a positive encounter, or "hit." If you have ever wondered when you get pulled over in a traffic stop whether your name is being fed into a terrorist database, rest assured — it is. When the police officer puts your name and driver's license into his computer, he is linking to the TSC.

Last year, the center had more than 20,000 positive matches against the list, but little is known about the center's effectiveness.

The terrorist watch list now contains more than 500,000 entries, according to a recent ABC News report on a document that has since been pulled from the web.

Getting off the terrorist watch list is not a simple procedure, given the government won't confirm if a person is on a list or not, and the TSC doesn't take responsibility for names placed on the list by a law enforcement or intelligence agency.

But a traveler who suspects the watch list is wrongly snagging them at airports or the border can try to use DHS' online redress site, known as DHS TRIP.

The center is asking for a $1.3 million budget increase in 2008 to fund additional employees, including some who will vet names submitted to the agencies. The TSC also wants to station an agent at Chicago's O'Hare airport to help clear up mismatches. New York's JFK, Washington Dulles, Miami and Los Angeles already have such agents.

Currently the TSC employs 108 employees, including 17 FBI agents, with a budget of $103 million.

It's sad that Temple-Raston didn't come out with a snapshot of the big board, but you can read and listen to Inside the Terrorist Screening Center.

I wonder if the Terrorism Screening Center director had to warn her not to spy in the spying room?

From August http://blog.wired.com/27bstroke6/200...l#previouspost

Whistle-Blower Site Taken Offline

A controversial website that allows whistle-blowers to anonymously post government and corporate documents has been taken offline in the US.

Wikileaks.org, as it is known, was cut off from the internet following a California court ruling, the site says.

The case was brought by a Swiss bank after "several hundred" documents were posted about its offshore activities.

Other versions of the pages, hosted in countries such as Belgium and India, can still be accessed.

However, the main site was taken offline after the court ordered that Dynadot, which controls the site's domain name, should remove all traces of wikileaks from its servers.

The court also ordered that Dynadot should "prevent the domain name from resolving to the wikileaks.org website or any other website or server other than a blank park page, until further order of this Court."

Other orders included that the domain name be locked "to prevent transfer of the domain name to a different domain registrar" to prevent changes being made to the site.

Wikileaks claimed that the order was "unconstitutional" and said that the site had been "forcibly censored".

Web names

The case was brought by lawyers working for the Swiss banking group Julius Baer. It concerned several documents posted on the site which allegedly reveal that the bank was involved with money laundering and tax evasion.

The site was founded in 2006

The documents were allegedly posted by Rudolf Elmer, former vice president of the bank's Cayman Island's operation.

A spokesperson for Julius Baer said he could not comment on the case because of "pending legal proceedings".

The BBC understands that Julius Baer asked for the documents to be removed because they could have an impact on a separate legal case ongoing in Switzerland.

The court hearing took place last week and Dynadot blocked access from Friday evening.

Wikileaks says it was not represented at the hearing because it was "given only hours notice" via e-mail.

A document signed by Judge Jeffery White, who presided over the case, ordered Dynadot to follow six court orders.

As well as removing all records of the site form its servers, the hosting and domain name firm was ordered to produce "all prior or previous administrative and account records and data for the wikileaks.org domain name and account".

The order also demanded that details of the site's registrant, contacts, payment records and "IP addresses and associated data used by any person...who accessed the account for the domain name" to be handed over.

Wikileaks allows users to post documents anonymously.

Information bank

The site was founded in 2006 by dissidents, journalists, mathematicians and technologists from the US, Taiwan, Europe, Australia and South Africa.

It so far claims to have published more than 1.2 million documents.

It provoked controversy when it first appeared on the net with many commentators questioning the motives of the people behind the site.

It recently made available a confidential briefing document relating to the collapse of the UK's Northern Rock bank.

Lawyers working on behalf of the bank attempted to have the documents removed from the site. They can still be accessed.

Dynadot was contacted for this article but have so far not responded to requests for comment.

Judge Shuts Down Web Site Specializing in Leaks
Adam Liptak and Brad Stone

In a move that legal experts said could present a major test of First Amendment rights in the Internet era, a federal judge in San Francisco on Friday ordered the disabling of a Web site devoted to disclosing confidential information.

The site, Wikileaks.org, invites people to post leaked materials with the goal of discouraging “unethical behavior” by corporations and governments. It has posted documents said to show the rules of engagement for American troops in Iraq, a military manual for the operation of the detention center at Guantánamo Bay, Cuba, and other evidence of what it has called corporate waste and wrongdoing.

The case in San Francisco was brought by a Cayman Islands bank, Julius Baer Bank and Trust. In court papers, the bank said that “a disgruntled ex-employee who has engaged in a harassment and terror campaign” provided stolen documents to Wikileaks in violation of a confidentiality agreement and banking laws. According to Wikileaks, “the documents allegedly reveal secret Julius Baer trust structures used for asset hiding, money laundering and tax evasion.”

On Friday, Judge Jeffrey S. White of Federal District Court in San Francisco granted a permanent injunction ordering Dynadot, the site’s domain name registrar, to disable the Wikileaks.org domain name. The order had the effect of locking the front door to the site — a largely ineffectual action that kept back doors to the site, and several copies of it, available to sophisticated Web users who knew where to look.

Domain registrars like Dynadot, Register.com and GoDaddy .com provide domain names — the Web addresses users type into browsers — to Web site operators for a monthly fee. Judge White ordered Dynadot to disable the Wikileaks.org address and “lock” it to prevent the organization from transferring the name to another registrar.

The feebleness of the action suggests that the bank, and the judge, did not understand how the domain system works, or how quickly Web communities will move to counter actions they see as hostile to free speech online.

The site itself could still be accessed at its Internet Protocol address ( — the unique number that specifies a Web site’s location on the Internet. Wikileaks also maintained “mirror sites,” or copies usually produced to ensure against failures and this kind of legal action. Some sites were registered in Belgium (http://wikileaks.be/), Germany (http://wikileaks.de) and the Christmas Islands (http://wikileaks.cx) through domain registrars other than Dynadot, and so were not affected by the injunction.

Fans of the site and its mission rushed to publicize those alternate addresses this week. They have also distributed copies of the bank information on their own sites and via peer-to-peer file sharing networks.

In a separate order, also issued on Friday, Judge White ordered Wikileaks to stop distributing the bank documents. The second order, which the judge called an amended temporary restraining order, did not refer to the permanent injunction but may have been an effort to narrow it.

Lawyers for the bank and Dynadot did not respond to requests for comment. Judge White has scheduled a hearing in the case for Feb. 29.

In a statement on its site, Wikileaks compared Judge White’s orders to ones eventually overturned by the United States Supreme Court in the Pentagon Papers case in 1971. In that case, the federal government sought to enjoin publication by The New York Times and The Washington Post of a secret history of the Vietnam War.

“The Wikileaks injunction is the equivalent of forcing The Times’s printers to print blank pages and its power company to turn off press power,” the site said, referring to the order that sought to disable the entire site.

The site said it was founded by dissidents in China and journalists, mathematicians and computer specialists in the United States, Taiwan, Europe, Australia and South Africa. Its goal, it said, is to develop “an uncensorable Wikipedia for untraceable mass document leaking and analysis.”

Judge White’s order disabling the entire site “is clearly not constitutional,” said David Ardia, the director of the Citizen Media Law Project at Harvard Law School. “There is no justification under the First Amendment for shutting down an entire Web site.”

The narrower order, forbidding the dissemination of the disputed documents, is a more classic prior restraint on publication. Such orders are disfavored under the First Amendment and almost never survive appellate scrutiny.

Wikileaks Site Has a Friend in Sweden
David F. Gallagher

Why did lawyers for a bank in the Cayman Islands ask a judge in essence to turn off the domain name of the Wikileaks site? Perhaps because they could not get the site shut down by more traditional means.

Companies that believe they have some reason to have something taken off the Web routinely have their lawyers fire off letters to the Web hosting company of the site in question. In this case, Julius Baer Bank was interested in removing some of its internal documents that had ended up on Wikileaks, a site that exists to publish documents that someone would rather not see published. But Wikileaks had clearly planned ahead for this sort of thing. The records for the site’s I.P. address indicate that it is hosted by PRQ, based in Stockholm. PRQ’s home page offers clues that it’s not just another hosting company. It paraphrases a quote from Mike Godwin of the Electronic Frontier Foundation: “I worry about my children all the time. I worry that 10 years from now, they will come to me and say, ‘Daddy, where were you when they took freedom of speech away from the Internet?’”

As it turns out, PRQ is owned by two founders of the Pirate Bay, the BitTorrent tracker site that is Hollywood’s least favorite online destination. The Pirate Bay guys have made a sport out of taunting all forms of authority, including the Swedish police, and PRQ has gone out of its way to host sites that other companies wouldn’t touch. It is perhaps the world’s least lawyer-friendly hosting company and thus a perfect home for Wikileaks, which says it is “developing an uncensorable system for untraceable mass document leaking and public analysis.”

The bank’s lawyers may have asked PRQ to remove the documents and been laughed at, or they may have learned a little bit about the company and decided not to waste their time. (The lawyers are not responding to requests for comment, and PRQ has not replied to an e-mail query.)

The weak link for Wikileaks turned out to be Dynadot, the registrar for its domain name, based in San Mateo, Calif. In an innovative move, the bank got a judge to have Dynadot change the records for wikileaks.org so it would no longer direct Web surfers to the server in Sweden. This is a little like getting someone taken out of the phone book. But this being the Internet, people found other ways to get the number out there.

Wikileaks Judge Gets Pirate Bay Treatment
Dan Goodin

Analysis Every now and again, an event comes along and takes our breath away by reminding us just how far out of step the legal system can be with today's changing world. The latest example is last week's attempt by a federal judge in California to shutter Wikileaks, a website devoted to disclosing confidential information that exposes unethical behavior.

Almost a week after US District Judge Jeffrey White unequivocally ordered the disabling of the guerrilla outfit, it remains up, and its foot soldiers are as defiant as ever. More to the point, it continues to host internal documents purporting to prove that a bank located in the Cayman Islands engaged in money laundering and tax evasion - the same documents that landed it in hot water in the first place.

It remains doubtful that Wikileaks will ever be shut down. That's because the site is hosted by PRQ (http://prq.se/), a Sweden-based outfit that provides highly secure, no-questions-asked hosting services to its customers. It has almost no information about its clientele and maintains few if any of its own logs.

Oh yeah, PRQ is also run by Gottfrid Svartholm and Fredrik Neij, two of the founders of The Pirate Bay, the BitTorrent tracker site that, as a frequent target of the Hollywood elite, has amassed considerable expertise in withstanding legal attacks from powerful corporate interests.

Not that attorneys from the Julius Baer Bank and Trust, the bank accused of the misdeeds, haven't demanded PRQ disconnect the site.

"We have the usual small army of stupid lawyers that think we will piss our pants because they send us a scary letter," Svartholm said in a telephone interview. "We do employ our own legal staff. We are used to this sort of situation."

Also making a take-down difficult, Wikileaks maintains its own servers at undisclosed locations, keeps no logs and uses military-grade encryption to protect sources and other confidential information, according to an unidentified individual who answered a press inquiry sent to Wikileaks.

"Wikileaks certainly trusts no hosting provider," the person wrote.

There's a name for arrangements such as these. It's called "bulletproof hosting," and it's historically been used to insulate online criminal gangs against take-down efforts by law enforcers or private parties. As Wikileaks has demonstrated, the measure can also be used by those engaging in civil disobedience. Wikileaks uses a different term: "an uncensorable system for untraceable mass document leaking."

Farewell Smokestacks

All of this seems to have been lost on Judge White. Last Friday, he issued a sweeping court order that directed Wikileaks and a dizzying array of ISPs, DNS hosts and website server providers to suspend all Wikileaks websites. White went so far as to extend his directive to "all those in active concert or participation with the Wikileaks defendants ... and all others who receive notice of this order."

Given the number of internet users who have joined Wikileaks' cause since learning of the case, the order could easily extend to tens of thousands of people or groups, many of them well beyond the jurisdictional reach of White's San Francisco-based court.
Perhaps that's why the only practical effect his ruling had was to force a registrar by the name of Dynadot to suspend the Wikileaks.org domain name. The site remains reachable by accessing its IP address ( or alternate domain names such as Wikileaks.be (http://wikileaks.be/wiki/Wikileaks) and wikileaks.in (http://wikileaks.in/wiki/Wikileaks). That's akin to removing a person's name from the phone book but not disconnecting his phone.

White's lack of internet savvy was in further evidence when he directed that a copy of his order be emailed to Wikileaks within 24 hours of the issuance of his order. The only problem there was that the suspending of Wikileaks.org prevented the organization's email system from working.

It would appear White is still caught up in the age that preceded the internet, when trade secrets were generally written down on paper and a fair amount of effort was required to disseminate them. Back in this smokestack era, broad orders covering anyone involved even indirectly in the appropriation of trade secrets made sense because the orders frequently had the result of plugging the leak.

Not so in this case, where the internet is a central player. White's order has done little to stop the leak, and it can be argued that it has only made the leak bigger. A few days ago, nary a soul had heard of Julius Baer or Wikileaks. Julius Baer's alleged money laundering has since gone mainstream thanks to the order, which has generated an endless series of headlines and provoked the ire of censorship opponents who have begun spreading the internal documents on mirror sites and peer-to-peer networks.

There are also perceived shortcomings in White's order. Specifically, the directive disabling the entire site is perceived by some First Amendment lawyers as a clear violation of free speech. And his prohibition on the publishing of "any other new or additional yet unpublished documents and data" that might belong to Julius Baer, likely amounts to prior restraint, another constitutional no-no.

As Eric Goldman, a professor of Law at Santa Clara University and author of the Technology and Marketing Law Blog (http://blog.ericgoldman.org/), observes: "There's simply no good remedy once confidential information hits the internet, and that's very frustrating to judges who are used to solving problems." Judge White, welcome to the internet age.

Whistle While You Work

From government to big business, if you have a dirty secret, Wikileaks is your nightmare. David Leigh and Jonathan Franklin on the site a US court has tried to muzzle
David Leigh and Jonathan Franklin

A secretive Swiss bank landed an apparently novel censorship blow against the internet this week. Anyone who tried to call up wikileaks.org, a global website devoted to publicising leaked documents, found themselves frustrated. The site simply wasn't there any more.

The Julius Baer bank in Zurich succeeded in hamstringing the shadowy individuals behind the website by the simple trick of moving not against them, but against a US company that hosted their domain name.

Dynadot, the California resellers who collect a few dollars by this internet trade, submitted to a legal injunction ordering the name to be deleted. Yet however wise this scheme may have appeared at the time to the Swiss bank's Los Angeles lawyers, Lavely & Singer, it has now backfired in a big way.

The injunction blew up a gale of debate about internet freedom, and sprayed the bank's secret documents all over the net. It has also thrust into prominence an obscure group of dreamers and programmers who want to provide what they call an "untraceable and uncensorable" leaking machine, to be used by dissidents worldwide.

Those behind Wikileaks include Tibetan, Chinese and Thai political campaigners, an Australian hacking author, and Ben Laurie, a mathematician living in west London who is on the advisory board.

Wikileaks is not the first site of its kind. John Young, a New York architect, has been posting leaked intelligence documents on his Cryptome site for some years. But since its launch in late 2006, Wikileaks has had an impressive record.

When Northern Rock collapsed last autumn, print media in London were gagged by a judge's order from re-publishing its leaked sales prospectus. It was Wikileaks that kept the prospectus before the public, along with the text of some threatening "not for publication" letters from the British lawyers, Schillings.

In the US, Wikileaks also made headlines last November with the publication of secret documents, including the 238-page manual Standard Operating Procedures for Camp Delta, a document that even the US military grudgingly admitted was genuine. The Guantánamo document, including descriptions of everything from transferring prisoners to evading protocols of the Geneva convention, was a comprehensive guide to day-to-day operations at the controversial prison.

Wikileaks landed an even bigger coup last August with a previously secret 110-page draft report by the international investigators Kroll, which revealed allegations of massive corruption in Kenya. The family of former Kenyan leader Daniel Arap Moi were reported to have siphoned off more than £1bn.

The reason Wikileaks has now enraged the Zurich bank is that pages have been posted detailing the bankers' most intimate trade secret: the way they hide the funds of their ultra-rich international clients in offshore trusts. This sort of material is very hot stuff. In Germany, the federal intelligence service recently paid an informer almost £4m for a disc containing similar details from a Liechtenstein bank. That led to raids on hundreds of suspected tax evaders, the disgrace of prominent businessmen, and a diplomatic collision with the tiny tax haven.

The person Baer describes as a disgruntled former employee at their own Cayman Islands office has similarly made off with a large quantity of internal records. A handful of these have made their way on to the Wikileaks site, which advertises that individuals can leak with the confidence they won't be discovered, thanks to the site's cryptographic protection.

The files tell some interesting stories. One of Margaret Thatcher's life peers allegedly salted away more than $100m (£50m) in a secret trust, for example. The late Lawrence Kadoorie, a Hong Kong millionaire, was ennobled in 1981 by the former British prime minister. He had built up the family's fortunes through China Light and Power, which provides Hong Kong with its electricity, and through a chain of hotels. According to the files, the Baer bank ran an anonymous company, registered in the British Virgin Islands and called Seneford Investments. A nominee director was based in a second tax haven, the Cayman Islands. But the real owner of Seneford Investments, it is claimed, was Kadoorie's family trust. In 1998, the documents listed six bank accounts for the company, in Switzerland and elsewhere. They held a total of $113m. There is no suggestion that this was illegal.

Kadoorie's son, Sir Michael, who still has major interests in the Hong Kong companies, did not respond yesterday to invitations from the Guardian to comment.

The other bank records posted by Wikileaks describe equally elaborate structures husbanding millions of pounds for Spanish financiers, Greek ship-owners, Chinese expatriates and wealthy New Yorkers. Although the leaker hints that tax frauds and bribery may lie behind some of these other accounts, he does not give enough detail to provide proof.

Wikileaks itself admits that some of the documents might be fabricated, and the whole affair might have only been seen as a curiosity, had the Baer bank not called in their lawyers. The federal judge Jeffrey White in San Francisco not only ordered removal of the domain name, but banned further circulation of the documents. As a result, they reappeared on Wikileaks "mirror" sites, hosted in the UK, Belgium and the Christmas Islands. It even transpired that the deleted main Wikileaks site could be accessed, slightly less conveniently, by using its IP number ( instead of the domain name.

Bloggers, online columnists and websites decried the bank's move as they launched a counterattack and lobbied in favour of Wikileaks' right to anonymously publish secrets. Less than a week after the court decision, a Google search for the court case turned up 69,000 hits. Four hours later, the tally was 78,000.

A further hearing on February 29 may well overturn the original decision.

The Zurich bank says: "It was the sole objective of Julius Baer to have legally protected documents removed from Wikileaks. We brought legal action against the website only after our initial efforts proved unsuccessful. In the course of taking such action, the bank has been made the subject of serious defamatory allegations. Such allegations are based on forged and stolen documents and are unequivocally denied. We have always sought to act in the best interests of our clients and shall continue to do so."

Who are Wikileaks? Although the project makes a feature of the anonymity of its volunteers, the minds behind it are not hard to find. One prominent driving force is Julian Assange, a much-travelled Australian programmer and author who has a flamboyant mane of silver hair. Before riding his motorcycle across Vietnam, he co-wrote a book about computer hackers.

"He's a pretty standard modern geek with a thing about dissidents," says the British encryption expert Ben Laurie, who advised the group on encryption. "He's quite techie and he can write code."

One of Assange's early schemes was to develop what he called "deniable cryptography". The idea was to help dissidents resist giving away secrets under torture. Texts would be encrypted in layers, so that even if a victim were forced to reveal a password, the torturer would not realise there was a second layer of information, hidden by a second password.

Assange then turned up in London and proposed the Wikileaks scheme for "an open-source, democratic intelligence agency". Laurie said: "I thought it was all hot air at first." But he became enthusiastic. He advised on an encryption system, first developed by the US Navy, which uses a chain of three separate servers, and ensures leakers can post documents anonymously.

Laurie is an international consultant on internet security. Earlier he set up a business that bought two military bunkers, at the abandoned US base at Greenham Common, and at an old RAF radar station in Kent. His company rents them out to firms and banks who want to protect their servers from attack. The Kent bunker is deep underground: "The radar operators were supposed to survive 30 days after a nuclear strike."

Some of his subversiveness may have rubbed off from his father, Peter Laurie, who wrote a cult book in the 1970s called Beneath the City Streets, which traced networks of secret government bunkers and tunnels.

Fresh off a flight from Washington, he answers the door to his rambling house in Acton in bare feet, and willingly explains why he approves of Wikileaks, while pointing out he is not personally responsible for any of their legally controversial deeds: "I have a long-term interest in privacy on the internet. It provides enormous opportunities for surveillance and this is not a good thing. Also, this is an interesting technical problem: how do you reveal things about powerful people without getting your arse kicked? Whistleblowing is a practice which should be encouraged.

"I'm really quite surprised at Wikileaks' success. They've done a lot of interesting stuff. It seems people are prepared to take the risk."

Another member of the advisory board is an American former draft resister, CJ Hinke. Speaking from his home in Thailand, he said: "Wikileaks is a decentralised phenomenon, and that means there are volunteers in dozens of countries. These volunteers form a very loose network so that, in fact, government can't home in on anybody and take drastic action against them."

In Thailand, Wikileaks has focused on efforts to block access to websites critical of the government. "The minute Wikileaks was announced, we sent them a huge trove of secret documents," said Hinke, founder of Freedom Against Censorship Thailand.

The documents included detailed lists of blocked sites, including all references to The King Never Smiles, a book published by Yale University Press. "Ordinary people come across things that governments or companies or individuals would prefer to keep secret. I think it is possible for almost everybody to expose these kind of events."

The wikileakers share the same belief in the "wisdom of crowds" that lies behind Wikipedia, the online encyclopaedia. Their theory is that their leaked documents will be self-verifying, thanks to the scrutiny of thousands of pairs of eyes. Some may wonder whether it's quite as easy as that.

Laurie cautions that Wikileaks' vaunted encryption is not completely unbreakable. Codebreakers such as the US National Security Agency could probably crack it, he says. "If my life was on the line, I would not be submitting [documents] to Wikileaks."

Look Before You Leak
Robert X. Cringely

I bet you thought people banked in the Cayman Islands because they serve fruity cocktails with tiny parasols in them while you're waiting for your checks to clear. Well, you're only partly right. The other reason people keep accounts in the Caymans is to avoid paying taxes and/or to launder their ill-gotten gains.

For many of us this is not news -- or at least it wouldn't be, if not for the brain-dead actions of one such bank and the magistrate they duped into being their monkey.

Swiss Bank Julius Baer used its legal muscle to convince a U.S. judge to close down the WikiLeaks.org domain, because the site contains documents that allegedly show Baer is exchanging its clients' dirty old dineros for fresh clean ones with just a hint of mint.

Some background: WikiLeaks.org exists so anonymous whistle blowers around the globe can document human rights offenses, corporate malfeasance, nuclear accidents, and the like. The world gets to see what nasty things those in power have been up to, while the leakers get to live their lives without being waterboarded (or worse).

Because WikiLeaks operates anonymously across several jurisdictions, Julius Baer couldn't figure out how to sue the site directly for copyright infringement. So last Friday the bank found a friendly judge, who ordered the site's California hosting company (Dynadot) to turn off the WikiLeaks.org domain. According to Wired News, WikiLeaks was only notified of the hearing by e-mail a few hours before it was scheduled to happen, and didn't have time to muster its squad of pro bono attorneys.

Personally, I don't think Baer was overly concerned the world would know its Cayman branch (allegedly) exists to launder money and avoid taxes. I think the bank didn't want its rich, extremely powerful, allegedly money laundering/tax evading clientele to be exposed. Bad for business, you know.

But the bank's solution is so mind-bogglingly stupid, you have to wonder if these guys need help getting their pants on each morning.

First, this is exactly the kind of story bloggers and Net-centric journos crave. Big nasty corporation stomps all over plucky public-serving underdog. Who can resist that plot line?

Second, the equation Bank Julius Baer = Money Laundering is now firmly cemented in the minds of everyone who has encountered this story, regardless of whether it's true.

Trois: The documents in question, which might have been quickly forgotten alongside the 1.2 million others on the site, are now hotter than the Paris Hilton sex video. Dozens of mirror sites have sprung up, and Cryptome.org and PirateBay have squirreled away copies of the docs for any interested parties.

Oh, and by the way, the judge's order failed to shut down the site. The IP numbers ( still work, as do its Belgian and Christmas Island domains. Or they would, only last time I checked the sites were overwhelmed with traffic from people with a sudden keen interest in Cayman Islands banking.

It's a fascinating study in how the courts and high-powered corporations still manage to shoot themselves in the feet when they try to manipulate the Net. (Remember: The Internet is not a dump truck, it's a series of tubes.) But it's also an illustration of why things like NSA wiretaps and efforts to throttle network traffic must be opposed.

Tap the Net backbone, and you make it much harder to post documents to places like WikiLeaks anonymously. (If you think those taps will only be used to identify terrorists, you're living in a fantasy world.) Suddenly the planet becomes a lot more dangerous for whistle blowers.

But this story also touches on both telecom immunity and Net neutrality. Say you're an AT&T employee who wants to post evidence revealing how the company deployed illegal wire taps. What's to keep your friendly telecom provider from killing those bits before they ever reach their destination? This is the kind of thing that will happen when ISPs are asked to become traffic cops, as the recording and movie industries have proposed.

As crypto-wonk Bruce Schneier has eloquently stated, this ain't about security, it's about control. Corporations and governments have an insatiable appetite for it. But I think we're all better off when they go hungry.

Judge May Hold Reporter in Contempt
Hope Yen

A federal judge said Tuesday he will hold a former USA Today reporter in contempt if she continues refusing to identify sources for stories about a former Army scientist under scrutiny in the 2001 anthrax attacks.

U.S. District Judge Reggie B. Walton said reporter Toni Locy defied his order last August that she cooperate with Steven J. Hatfill in his lawsuit against the government. Walton indicated he would impose a fine until she divulged her sources, but that he would take a few more days to decide whether to postpone the penalty as she pursues an appeal.

The judge is also considering whether to find former CBS reporter James Stewart in contempt.

''I will order she provide the sources of information,'' Walton said during a hearing, as Locy, dressed in black, looked grim and slowly shook her head in disagreement.

''I don't like to have to hold anyone in contempt,'' the judge added, but when it comes to cases where a person says his reputation was destroyed because of stories published about him, ''the media has to be responsible.''

Both Locy, who is also a former Associated Press reporter, and her attorney, Robert C. Bernius, declined to comment after the hearing.

Walton did not immediately indicate the amount of the fine. Hatfill's attorneys have asked Walton to initially fine Locy $1,000 per day and to prohibit media corporations from paying the fines for her to force compliance. The proposed daily fine would have increased to $2,000 after a week and continue to increase $1,000 every week.

In Stewart's case, Walton said he would take a few weeks to consider the reporter's claim that divulging his sources was no longer necessary since several law enforcement officials had already acknowledged talking to reporters in the case about information similar to what Stewart reported.

Hatfill, who worked at the Army's infectious diseases laboratory from 1997 to 1999, was publicly identified as a ''person of interest'' in the 2001 anthrax attacks. He is suing the Justice Department, accusing the agency of violating the federal Privacy Act by giving reporters information about the FBI's investigation of him.

Walton previously ordered five journalists to reveal all of their sources. Stewart and Locy refused, saying Hatfill was partly to blame for news stories identifying him as a suspect after his attorney provided details about the investigation.

During Tuesday's hearing, Bernius also argued that Locy could not remember who gave her information specifically about Hatfill and that she should not be forced to disclose the names of roughly 10 FBI and Justice Department officials who spoke to her generally about the anthrax investigation.

That immediately drew a skeptical response from Walton.

''I'm not suggesting that Ms. Locy would not be truthful, but it would be convenient for reporters in this type of situation to say 'I don't remember' and then be off the hook,'' Walton said. ''That would be one way to avoid the serious consequences of the law.''

Walton's move is the latest in a handful of cases nationwide, most notably in Washington, in which reporters have been held in contempt for failing to reveal confidential sources.

In 2004, U.S. District Judge Thomas Penfield Jackson fined five reporters $500 a day each for refusing to identify their sources for stories about Wen Ho Lee, a former nuclear weapons scientist once suspected of spying. After Jackson postponed the fines pending appeals, news organizations including The AP eventually agreed to pay Lee $750,000 as part of a $1.6 million settlement of his privacy lawsuit against the government after the U.S. Supreme Court declined to hear appeals in the case.

More recently, last year nearly a dozen of Washington's best-known journalists took the stand during the CIA leak criminal trial, most of them unwillingly under court order by Walton, to recount confidential interviews. In that case, New York Times reporter Judith Miller was sent to jail for 85 days after refusing to disclose her sources.

Jack Thompson Served With Order to Show Cause by State Supreme Court
Chris Peredun

Thompson given until March 5th to prove that he has not "abused the legal system"

Whenever a tragedy occurs, it is virtually a given that Florida attorney Jack Thompson is making a beeline for the nearest media outlet to voice his predictable opinion that video games were the cause of the violent outburst, and has made several attempts to use the legal system to further his cause; however, the Florida Supreme Court appears to be striking back.

GamePolitics, who has had no shortage of communication with Thompson in the past, is reporting that Thompson himself has forwarded the Florida Supreme Court's "Order to Show Cause" that was sent to Thompson's office earlier this week, and has posted the following excerpt from the email exchange:

It appears to the Court that you have abused the legal system by submitting numerous frivolous and inappropriate filings in this Court.

Therefore, it is ordered that you shall show cause on or before March 5, 2008, why this Court should not find that you have abused the legal system process and impose upon you a sanction for abusing the legal system, including, but not limited to directing the Clerk of this Court to reject for filing any future pleadings, petitions, motions, letters, documents, or other filings submitted to this Court by you unless signed by a member of The Florida Bar other than yourself.
The phrase "numerous frivolous and inappropriate filings" stands out to any member of the gaming community familiar with Mr. Thompson's less-than-stellar record in attempting to sway the gaming industry. Mr. Thompson's vitriolic response was both equally amusing and confusing, as he the eggs on the very court that serves him the notice:

This is the single greatest gift that any court has ever given me in my 31 years of practicing law. I shall now, through a new federal lawsuit, deconstruct The Florida Bar ... This court has threatened Thompson. He does not threaten back. He hereby informs this court that he will see it in federal court.
The Florida court is looking forward to this appearance.

Pirate Bay Mysteriously Reappears on Yahoo
Chloe Lake

YAHOO search has resumed linking to file-sharing website The Pirate Bay without explaining why the site disappeared from its search results earlier this week.

The Pirate Bay, based in Sweden, is the world's largest source of BitTorrent files and has repeatedly faced international legal action for linking to pirated material.

Yahoo began removing direct links to The Pirate Bay from its search results earlier this week. A search for the words "pirate bay" returned a list of other websites that mentioned the The Pirate Bay, such as Wikipedia, but no link to the website itself.

The Pirate Bay contains a database of torrent files, which contain information needed to share larger files such as movies and music with other people. The website has argued that since the torrent files themselves do not contain copyrighted material, it is not illegal to store them.

File-sharing blog TorrentFreak first reported that the website had disappeared from Yahoo's search results on February 18.

On Wednesday, The Pirate Bay reappeared in search results on Yahoo7 Australia after a request for information was sent to the company by NEWS.com.au.

The Pirate Bay has since reappeared on the websites of Yahoo US and Yahoo UK as well – but no reason for the turnaround has been given.

A spokesperson for Yahoo7 Australia said they were "unable to comment" on the removal of direct links to the website.

The Pirate Bay co-founder "Brokep" said Yahoo's filtering of search results was "dangerous".

"Yahoo should let the governments decide, not themselves," he told TorrentFreak.

"It’s dangerous when companies take the law into their own hands.”

The Pirate Bay has been a major target for anti-piracy bodies the Recording Industry Association of America (RIAA), the Motion Picture Association of America (MPAA) and the International Federation of the Phonographic Industry (IFPI).

It is currently facing legal action in Sweden and pressure in Denmark, where a court ordered local internet service provider Tele2 to block all access to the website.

Filtering of search results by companies such as Yahoo and Google is a controversial issue which many claim has serious implications for free speech.

Earlier this month a Chinese university professor who lost his job after founding a democratic political party said he planned to take legal action against Yahoo and Google in the US for censoring his website from search results in China.

Opera CTO: How to Fix Microsoft's Browser Issues

Embrace the standards, nicely, or get out of browsers
Håkon Wium Lie

If there was a functioning market for web browsers and operating systems, the past few weeks would have seen two announcements from Microsoft. After a firestorm of criticism from the web design community about Internet Explorer 8's misguided mode switching proposal, Redmond would have publicly backed down. Second, Microsoft would have bowed to 90,000 users demanding that Windows XP continue to be sold.

There were no such announcements. Why? Because Microsoft, with its dominating position in the web browser and operating system markets, acts like a monopoly.

A monopoly doesn't have to consider its customers' wants or needs. In a functioning market, vendors must consider such things in order to compete successfully. But the market isn't functioning.

Microsoft's failure to respond to its customers' outcry shows that it is time to call on established antitrust laws that allow governments to impose sanctions on a vendor that has a dominant position in a market. The purpose of these sanctions is to ensure competition and innovation and thereby create a market in which consumers are heard.

Recently, the European Commission opened several investigations into Microsoft's dominant position. As a regulatory body, they could decide to impose sanctions and while Microsoft might ignore their frustrated customers, they would have a harder time ignoring the European Commission.

So, what should the European Commission demand from Microsoft?

In the area of web browsers, Opera Software has proposed a specific kind of remedy - that Microsoft only be allowed to distribute standards-compliant browsers. Microsoft's IE is bug-ridden and the company, despite its vast resources, has shown little interest in fixing problems that cost web designers time and sleep. IE dominates the web due to its being bundled with Windows. This forces web designers to prioritize coding for IE. Coding for standards-compliant browsers becomes a secondary consideration.

Microsoft is keenly aware of this and therefore has little interest in improving their support for standards. They will never become standards compliant unless forced by someone in a position to demand a change, something that users and customers are not. Requiring standard compliance would greatly lessen Microsoft's monopolistic stranglehold in the web browser market, would delight web developers everywhere and would, ironically, make IE a better product.

So, if the web community could impose requirements on Microsoft's browser, what would they be? Here is my list:

1. Support Acid2 and Acid3, by default. Acid2 is a well-known test and the follow-up Acid3 is being finalized. The tests must be passed by default. That is, users or authors should not have to select "standards mode", which is guaranteed to minimize the impact of standards.

2. Support the underlying specifications. The Acid tests are written to help browser vendors who act in good faith, and they do not guarantee compliance with the underlying specifications. Microsoft must commit to implementing the underlying specifications of the Acid2 and Acid3 tests.

3. Provide documentation. Lack of documentation on how IE implements standards has been a problem for web developers. For each specification Microsoft implements, it must provide a detailed list of limitations, bugs and extensions. The list must be publicly available.

4. Drop mode switching. Documents that trigger standards mode in IE6 or IE7 (or almost standards mode, as per the documentation in Wikipedia and on Microsoft's site) shall continue to trigger standards mode in the future. No new magic switches can be introduced.

5. Commit to interoperability. It is important to ensure that Microsoft remains committed to supporting web standards, even beyond Acid2 and Acid3. If two or more major web browsers, in official shipping versions, add standards-related functionality that's generally considered useful to the progress of the web, and described in a publicly available specification, Microsoft must add the same functionality.

Microsoft will surely claim that it's impossible for them to develop a browser that complies with the proposed requirements. However, other browsers have played by these rules for years. If Microsoft can't live up to the standards of the web, I suggest they leave the browser business.

What would be on your list?

Microsoft to Share More Technical Secrets
Steve Lohr

Seeking to satisfy European antitrust officials, Microsoft said on Thursday that it would open up and share many more of its technical secrets with the rest of the software industry and competitors.

Microsoft executives, in a conference call, characterized the announcement as a “strategic shift” in the company’s business practices and its handling of technical information. They also portrayed the moves as only partly a nod to the continuing challenge Microsoft faces from Europe’s antitrust regulators.

The broader goal, they said, is to bring Microsoft’s flagship personal computer products — the Windows operating system and Office productivity programs — further into the Internet era of computing. Increasingly, people want a seamless flow of documents, data and programming code among desktop PCs and the Internet, especially as they make the shift from using software on a PC to using services on the Web.

“These steps are being taken on our own,” said Steven A. Ballmer, Microsoft’s chief executive. The move, he said, was a recognition of Microsoft’s “unique legal situation,” but it was also the company’s effort to adapt to “the opportunities and risks of a more connected, more services-oriented world.”

Microsoft’s first step will be to put on its Web site 30,000 pages of technical documentation detailing how its Windows desktop and Microsoft server programs communicate and share information. Until now, that information was treated as a trade secret and was available only under a special license.

Ray Ozzie, Microsoft’s chief software architect, said that by sharing more information, Microsoft would make it easier for others to write Internet programs that tap into personal information on a PC.

That, Mr. Ozzie added, should bring new sets of Web services that, for example, might match a person’s calendar information with a doctor’s schedule. Then smart software could make an appointment. At home, he noted, someone’s digital collection of music, movies and family photos would be more easily shuffled to different devices and screens.

“The Internet opens up a world of potential innovation,” Mr. Ozzie said. “And I think we’ve just scratched the surface.”

Microsoft announced other plans to open up its technology, like allowing developers to add more non-Microsoft document formats to its Office word processing and spreadsheet programs. Microsoft also made commitments to increase its support for industry standards and work with open-source software developers.

European regulators and others have long accused Microsoft of using its dominance in PC operating systems and software to lock out competitors. Last October, after a nine-year confrontation and a ruling against the company by Europe’s second-highest court, Microsoft agreed to share information with rivals on terms it had long resisted. Then, after fresh complaints from Microsoft’s competitors, the European antitrust regulators last month announced that they were opening new investigations of the company.

The new inquiry focuses partly on whether Microsoft has withheld essential information from competitors that want to make products that work smoothly with its Office programs. The Office products were not part of the previous European action against Microsoft.

After the Microsoft announcement on Thursday, the European Commission issued a skeptical statement. The commission said it “would welcome any move towards genuine interoperability,” or allowing software programs from different companies to work smoothly together. But the commission noted that “today’s announcement follows at least four similar statements by Microsoft in the past on the importance of interoperability.”

Asked about the commission’s statement, Bradford L. Smith, Microsoft’s general counsel, said that the company’s moves were “qualitatively and quantitatively different from anything we’ve done in the past.”

“People will test us not just by our words but by our actions,” Mr. Smith added.

The industry is taking a wait-and-see stance on Microsoft’s plan. Linux, an open-source competitor to Windows, stands to benefit from Microsoft’s more open posture. Regulators and competition are “forcing Microsoft to change the way it does business,” said James Zemlin, executive director of the Linux Foundation, a nonprofit consortium.

The change comes as Microsoft is trying to buy Yahoo, a huge deal that, if it proceeds, will be closely scrutinized by antitrust officials worldwide. The European regulators typically take a harder line than their American counterparts in challenging takeovers.

“To get the deal approved, Microsoft has to convince the European regulators that it has changed its spots on interoperability, no longer acting like a proprietary monopoly,” said Ken Wasch, president of the Software and Information Industry Association, a trade group that includes Microsoft competitors like I.B.M., Oracle, Sun Microsystems and Red Hat.

Microsoft is also trying to win approval from an international standards body for its new document format, Office Open XML. Microsoft contends its format is “open,” meaning files in the format can be created and read by anyone.

A different format standard for Internet-based computing, the OpenDocument Format, is supported by I.B.M., Google, Oracle and other Microsoft rivals. They assert that the proposed Microsoft standard is complex and layered with the company’s own features, making it effectively a corporate standard instead of a truly open one.

Last September, Microsoft failed to win enough support for its standard from the International Organization for Standardization. But the standards body will review that decision in proceedings that begin next week.

EU Regulators Skeptical on Microsoft's Plan to Share Technology

European Union regulators are expressing skepticism over Microsoft's latest offer to share more information about its products and technology.

The EU said in a statement Thursday it has seen four other similar statements in the past from the world's largest software maker.

Earlier Thursday, Microsoft announced it will be publishing technical information about its products to ensure interoperability with rivals' offerings. It won't make software developers obtain a license or pay royalties or other fees.

The EU also said it would welcome any move toward "genuine interoperability." And regulators added they'll continue to check if Microsoft is complying with antitrust rules.

Maybe Microsoft Should Stalk Different Prey
Randall Stross

OVER the years, Microsoft has pummeled countless rivals, including the superheavyweight I.B.M. But it has never faced a smaller foe as formidable as Google. The tale of the tape gives Microsoft a $100 billion advantage in market capitalization, but it counts for little: Google appears to be its superior in strength, speed, smarts.

Having exhausted its best ideas on how to deal with Google, Microsoft is now working its way down the list to dubious ones — like pursuing a hostile bid for Yahoo. Michael A. Cusumano, who has written several books about the software industry and about Microsoft, is not impressed with Microsoft’s rationale for its Yahoo offer. He said the bid seemed to be a pursuit of “an old-style Internet asset, in decline, and at a premium.”

Determined to match Google in search and online advertising, Microsoft has managed to overlook a plain-vanilla strategy, the oldest one in the book: build on its own strengths. What it does best is to sell software to corporations, for all sorts of applications, visible and not so visible, at a handsome profit.

If Microsoft thinks this is the right time to try a major acquisition on a scale it has never tried before, it should not pursue Yahoo. Rather, it should acquire another major player in business software, merging Microsoft’s strength with that of another. This is more likely to produce a happier outcome than yoking two ailing businesses, Yahoo’s and its own online offerings, and hoping for a miracle.

For an illustration of how Microsoft could select targets more judiciously, Mr. Cusumano, who is a professor at the Sloan School of Management at the Massachusetts Institute of Technology, pointed to the Oracle Corporation’s strategic acquisitions and its prudent use of capital to “roll up firms with similar products and customers to its own.” With impressive regularity — 13 strategic acquisitions in 2005, another 13 in 2006 and 11 in 2007 — Oracle has picked up key products and customers while avoiding an “oops” slip, venturing too far away from its core business, or paying too much. At no point along the way has it acted in a fit of desperation.

Last month, Oracle pulled in another major prize, BEA Systems, a leading software company, for about $8.5 billion. You’ve probably never heard of BEA: it’s doubly obscure, producing the behind-the-scenes infrastructure that large companies use to build behind-the-scenes software systems for their entire business, or “enterprise software.” Both Oracle and BEA are based in Silicon Valley, but their side of the street is not lit by klieg lights and does not get the same attention as the Googles and Yahoos.

And, to be honest, it’s not much fun hanging out on the enterprise side of the software business. BEA says its software helps organizations “ensure that business processes are optimally defined, managed, executed and monitored.” Unless you’re playing Business Jargon Bingo, it’s hard to sit still and remain attentive. You have to admire Oracle’s ability to remain focused on the business that serves business and to not be distracted by the buzz of the Web crowd gathered across the street.

Microsoft does business software well. Approximately half its revenue comes from business customers for its e-mail infrastructure, database systems, developer tools, Office productivity applications and other mainstays. It has also assembled, through acquisitions, a fledgling line of enterprise software that it calls Microsoft Dynamics. Microsoft would like Dynamics to be viewed as competing head to head with the No. 2 name in enterprise software, Oracle, or the No. 1, SAP of Germany. For the moment, however, Microsoft Dynamics’ parity with those big names is nothing more than wishful aspiration.

Professor Cusumano has a suggestion: Rather than acquire Yahoo, Microsoft should pursue SAP.

It’s not an outlandish idea. The two companies held merger talks in late 2003, and perhaps since then, too. Microsoft is in an enviable position: it is a nearly universal presence in corporate data centers, and large enterprise customers are arguably the best customers a software company can have. Clients pay very dear prices for the complex, semicustomized software that runs their business. And once they’ve got their systems running — a process that can take years to complete — they aren’t inclined to change vendors lightly.

A few dozen well-paying Fortune 500 customers may actually be more valuable than tens of millions of Web e-mail “customers” who pay nothing for the service and whose attention is not highly valued by online advertisers.

Today, SAP’s market capitalization is about $59 billion, and a sizable premium to get a deal done would send its price well north of that. Microsoft cannot put both SAP and Yahoo in its shopping cart, deals that together might run well over $120 billion. Microsoft must pick one or the other.

Suppose that Lawrence J. Ellison, the chief executive of Oracle, were the head of Microsoft and was doing the shopping. Which deal would he choose? Past experience suggests that it would not be Yahoo. That acquisition would bring little but duplication headaches — and no large enterprise customers.

It’s amusing to note that the most Larry-like choice, Microsoft’s acquiring of SAP and leaving it alone as an autonomous division to avoid a cross-cultural integration fiasco, is the course that would be most discomfiting to Oracle. Frank Scavo, president of Computer Economics, an information technology research firm, in Irvine, Calif., said that “a Microsoft-SAP combination would be Oracle’s worst nightmare.”

Google would not be happy with a conjoined Microsoft and SAP, either. It has made a pro forma expression of its own opposition to a Microsoft-Yahoo merger, but we can speculate that it may be cheering that deal on. Working in Google’s favor are the hostile nature of Microsoft’s bid, the colossal potential for integration problems, and organizational paralysis in, and exodus of talent from, Yahoo.

But were Microsoft to turn and head in SAP’s direction, Google would have reason for concern. Whatever strengthens Microsoft is bound to influence, later if not sooner, its continuing competition with Google. For its own part, Google is keen to expand its foothold inside large companies. Last year, it acquired Postini, whose software filters corporate e-mail. Google has not done so well with corporate customers on its own, however. Google Apps has conspicuously failed to win adoption quickly.

If Microsoft is to rededicate its attention to its most valuable assets, business customers, a prerequisite is dropping its ill-advised bid for Yahoo. And to find the best acquisition strategy, ask, “What would Larry do?”

If Microsoft tries to fight Google with wobbly legs, scared witless, it will lose.

EU, U.S. Vow Crackdown on Computer Counterfeits

EU and U.S. senior officials said on Friday they would crack down on counterfeiting of computer components after they seized over 360,000 fake items in just two weeks in a joint operation at the end of last year.

Integrated circuits and computer components of over 40 trademarks including Intel, Cisco and Philips, worth more than $1.3 billion, were seized during the operation, the officials said.

"Traffickers and counterfeiters have become much more sophisticated ... They are no longer confining themselves to trafficking in some of the traditional goods we used to see them in, such as footwear or handbags," U.S. Customs and Border Protection Assistant Commissioner Dan Baldwin said.

"There are increasing numbers with high-tech goods, goods that impact our critical infrastructure," Baldwin told reporters after talks with European Union counterparts in Brussels.

Integrated circuits are used in a wide range of products including computers, aircraft, cars and telecommunications.

U.S. and EU officials said both sides of the Atlantic would work with importers to see how the fakes entered their markets, launch criminal investigations and take up the matter with China, where most of the fakes came from.

"We've identified a pretty significant problem, a fairly high risk for critical infrastructure," Baldwin said. "There will be criminal investigations."

Officials could not say at this stage if the importers knew they were trading counterfeit products and whether the problem came from a few factories or was more widespread.

But he warned the problem could affect all producers and said the industry needed to cooperate better to help them identify fakes.

John Pulford, a European Commission official responsible for customs risk management, said some fakes also came from Taiwan and Hong Kong and that most arrived by air, through couriers.

The first EU-U.S. customs operation took place in several German airports including Frankfurt and Leipzig, in France's Roissy-Charles-de-Gaulle airport and in Britain's Heathrow, as well as a number of hubs in the U.S., the officials said.

Pulford said it was only one of the many intellectual property rights problems the EU had with China.

According to the Organization for Economic Co-operation and Development, the trade in pirated consumer goods has reached $200 billion a year, equivalent to 2 percent of world trade, with many fake items coming from China.

(Reporting by Ingrid Melander, editing by Will Waterman)

Say What You Will (Requiem for a TV News Career)
Chez Pazienza

Maybe this was always the way it had to be.

When I was 19, I broke into the offices of WVUM -- the radio station at the University of Miami -- live, during an installment of my weekly radio show. I raided a file cabinet and my crew and I proceeded to read the minutes of that week's executive board meeting on the air, paying special attention to a recurring topic of conversation among my apparently exasperated supervisors -- a series of incidents which, collectively, were referred to as "The Chez Situation."

The board as a whole was less-than-pleased with, for example, my insistence on jokingly pointing out to my audience the fact that WVUM's faculty adviser seemed to be waging and winning a valiant war against sobriety, and as such deserved congratulations all-around. There was also my insinuation that one of the station's sponsors, a club which had just opened on South Beach, would likely be closed in two weeks then renamed and reopened two weeks later. (In fact, it took about a month to close.)

I regularly ignored the program director's God-awful musical "suggestions," choosing instead to play whatever I felt like hearing.

I ridiculed the University's decision to replace the garbage cans on campus with new, attractive, and extraordinarily expensive stone receptacles immediately after making an announcement that tuition for the coming year would be skyrocketing.

I poked fun at the frat boys.

I advocated mischievous insurrection.

I occasionally threw out a few low-level swear words on-air.

I was kind of a punk kid, and I admit it.

Yet, despite the all of this, I remained on the air simply because even though my superiors may have been irritated by the fallout from my juvenile antics, they usually found the antics themselves eminently entertaining. I was good at what I did; I had a voice and I wasn't the least bit afraid to use it, consequences be damned -- or not considered at all. Being exactly who I was, for whatever reason, seemed to be more important to me than any other consideration.

When I got into television, I did my best to bury my inner-revolutionary. For 16 years I've been a successful producer and manager of TV news, cranking out creative, occasionally daring content on good days and solid, no-frills material on the days in between. I've won several awards and for the most part can say that I'm proud of what I've done in the business, particularly since I never intended to get into it in the first place; by the time college was over, I was playing steadily in a band and fully believed sleeping on floors and subsisting on beer and Taco Bell to be an entirely noble endeavor. I wound up working at WSVN in Miami only after the band imploded, taking my dreams of rock n' roll glory with it. Since those earliest days, I've come to understand that the libertine, pirate ship mentality I found so seductive during my time in a rock band is pretty much a staple of most newsrooms, particularly at the local level. What's more, it's accompanied by a slightly better paycheck (although often only slightly).

Over the past several years though, something has changed. Drastically. And I'm not sure whether it's me, or television news, or both.

With the exception of the period immediately following 9/11, which saw the best characteristics of television journalism shocked back into focus and the passion of even the most jaded and cynical of its practitioners return like a shot of adrenaline to the heart, the profession I once loved and felt honored to be a part of has lost its way.

I say this with the knowledge of implied complicity: I continued to draw a salary from stations at the local level and national networks long after I had noticed an unsettling trend in which real news was being regularly abandoned in favor of, well, crap. I may not have drank the Kool-aid, but I did take the money. I may have been uncomfortable with a lot of what I was putting on the air, but I was comfortable in the life that it provided me. I just figured, screw it, most people don't like their jobs; shut up and do what you're told, or at least try to. Besides, I told myself, what the hell else do you know how to do?

That attitude began to change in April of 2006 -- when I found out that I had a tumor the size of a pinball inside my head.

I was working for CNN at the time, a job I had been proud to accept three years earlier as CNN was in my mind the gold-standard of television journalism. I readily admit that it was Time-Warner's medical plan that provided me the best care possible for the removal of the tumor and during my subsequent recovery, but following my operation, what had been clawing at my insides for years finally began to come to the surface. TV news wasn't the least bit fulfilling anymore, and I either needed to get out of it once and for all or find an outlet for my nascent iconoclastic tendencies.

So I started a blog.

I did it mostly to pass the time, hone my writing skills, resurrect my voice a little, and keep my mind sharp following the surgery. As is the case with many online journals, not a soul other than myself and a few close friends and family were even aware of what I was doing, much less read my stuff regularly. I thought nothing of returning to work at the end of my medical leave while continuing to write online. Really, who the hell knew who I was? Who cared what I had to say?

As it would turn out, over time, more than a few people.

My admittedly worthless opinions on pop culture, politics, the media and my personal past were quickly linked by sites like Fark, Gawker and Pajiba and I found my readership growing exponentially. During this time, I still didn't consider telling my superiors at CNN what I was doing on the side, simply because, having never been provided with an employee handbook, I hadn't seen a pertinent rule and never signed any agreement stipulating that I wouldn't write on my own time. I hadn't divulged my place of work and wasn't writing about what went on at the office. The views expressed on my blog, Deus Ex Malcontent, were mine and mine alone. I represented no one but myself, and I didn't make a dime doing it.

For 20 months after starting DXM, I continued to work as a producer on American Morning, one of many charged with putting together the show. During that time, I received consistently favorable reviews (while in Atlanta I was told that I was well on my way to becoming an executive producer) and, more importantly, neither my credibility nor objectivity was ever called into question. Like anyone who considers him or herself a respectable news professional, whatever my personal opinions were, they were checked at the door when I walked into work. Having grown up in a household in which the highest ideals of journalism were never more than a conversation away -- my father was an old-school investigative reporter -- I knew full well that you couldn't avoid having opinions and viewpoints, but you never let them get in the way of your journalistic responsibility

As far as CNN knew, I was a valued employee, albeit one with almost no say in the day-to-day editorial decisions on American Morning. This held true even as I began contributing columns to the Huffington Post, giving my writing more exposure than ever before.

Then, last Monday afternoon, I got a call from my boss, Ed Litvak.

Ed, seeming to channel Bill Lumburgh from Office Space, informed me of that which I was already very well aware: that my name was "attached to some, uh, 'opinionated' blog posts" circulating around the internet. I casually admitted as much and was then informed of something I didn't know: that I could be fired outright for this offense. 24 hours later, I was. During my final conversation with Ed Litvak and a representative from HR, they hammered home a single line in the CNN employee handbook which states that any writing done for a "non-CNN outlet" must be run through the network's standards and practices department. They asked if I had seen this decree. As a matter of fact I had, but only about a month previously, when I stumbled across a copy of that handbook on someone's desk and thumbed through it. The Week in Review is edited and published by Jack Spratts. I let them know exactly what I had thought when I read the rule, namely that it was staggeringly vague and couldn't possibly apply to something as innocuous as a blog. (I didn't realize until later that CNN had canned a 29-year-old intern for having the temerity to write about her work experiences -- her positive work experiences -- in a password-protected online journal a year earlier.) I told both my boss and HR representative that a network which prides itself on being so internet savvy -- or promotes itself as such, ad nauseam -- should probably specify blogging and online networking restrictions in its handbook. I said that they can't possibly expect CNN employees, en masse, to not engage in something as popular and timely as blogging if they don't make themselves perfectly clear.

My HR rep's response: "Well, as far as we know, you're the only CNN employee who's blogging under his own name."

It took self-control I didn't know I had to keep from laughing, considering that I could name five people off the top of my head who blogged without hiding their identities.

Uh-huh, as far as you know.

When I asked, just out of curiosity, who came across my blog and/or the columns in the Huffington Post, the woman from HR answered, "We have people within the company whose job is specifically to research this kind of thing in regard to employees."

Jesus, we have a Gestapo?

A few minutes later, I was off the phone and out of a job. No severance. No warning (which would've been a much smarter proposition for CNN as it would've put the ball effectively in my court and forced me to decide between my job or the blog). No nothing. Just, go away.

Right before I hung up, I asked for the "official grounds" for my dismissal, figuring the information might be important later. At first they repeated the line about not writing anything outside of CNN without permission, but HR then made a surprising comment: "It's also, you know, the nature of what you've been writing."

And right there I knew that CNN's concern wasn't so much that I had been writing as what I'd been writing. Whether a respected and loyal CNN producer of four years, like myself, could've gotten off with a warning had I chosen to write about, say, my favorite pasta sauce recipes, who knows. I'm dead sure though that my superiors never concerned themselves with my ability or inability to remain objective at work, given my strong opinions; they worried only about an appearance of bias (specifically, a liberal bias), and apparently they worried about it more than any potential fallout from firing a popular blogger with an audience that was already large and was sure to grow much larger when news of his firing put him in the national spotlight.

It's probably right about now that I should make something perfectly clear: I'm not naive -- I always understood that CNN, like any big company, might be apt to fire whoever it damn well pleases so long as the law remains intact at the end of the day.

Should they have fired me though?

Probably not, and only arrogant myopia would make them think otherwise.

As soon as the official word came down, I picked up the phone and called a friend of mine named Jacki Schechner. CNN junkies will recognize her as a former internet reporter for the network, one who pulled double-duty on American Morning and The Situation Room -- that is until the day she was taken out into the figurative woods without any warning and given the Old Yeller treatment. CNN's willingness to fire someone like Jacki tells you everything you need to know about how backward the network's thinking is when it comes to new media. It pays more lip-service to bloggers and their internet realm than any other mainstream media outlet, but in the end that's really all it is -- lip-service. Jacki was not only popular in internet circles, she had forged personal relationships with most of the big names in the blogosphere and knew her stuff inside and out. Inevitably though, CNN -- particularly American Morning -- chose to wear down and ultimately piss away this asset in favor of an on-air acquisition that fell right in line with the tried-and-true "TV" sententia: Veronica De La Cruz. The network never considered for a minute that new media might behave differently than television -- that the regular rules might not apply.

And that's the problem.

As far as CNN (and to be fair, the mainstream TV press in general) believes, it still sits comfortably at the top of the food chain, unthreatened by any possibility of a major paradigm shift being brought to bear by a horde of little people with laptops and opinions. Although the big networks recognize the need to appeal to bloggers, they don't fear them -- and that means that they don't respect them. Corporate-think dictates that the mainstream television press as a monstrous multi-headed hydra is the ultimate news authority and therefore is in possession of the one and only hotline to the ghosts of Murrow and Sevareid. Sure those bloggers are entertaining, but in the end they're really just insects who either feed off the carcasses of news items vetted through various networks or, when they do break stories, want nothing more than to see themselves granted an audience by the kingmakers on television.

This, of course, is horseshit.

During my last couple of years as a television news producer, I watched the networks try to recover from a six year failure to bring truth to power (the political party in power being irrelevant incidentally; the job of the press is to maintain an adversarial relationship with the government at all times) and what's worse, to pretend that they had a backbone all along. I watched my bosses literally stand in the middle of the newsroom and ask, "What can we do to not lead with Iraq?" -- the reason being that Iraq, although an important story, wasn't always a surefire ratings draw. I was asked to complete self-evaluations which pressed me to describe the ways in which I'd "increased shareholder value." (For the record, if you're a rank-and-file member of a newsroom, you should never under any circumstances even hear the word "shareholders," let alone be reminded that you're beholden to them.) I watched the media in general do anything within reason to scare the hell out of the American public -- to convince people that they were about to be infected by the bird flu, poisoned by the food supply, or eaten by sharks. I marveled at our elevation of the death of Anna Nicole Smith to near-mythic status and our willingness to let the airwaves be taken hostage by every permutation of opportunistic degenerate from a crying judge to a Hollywood hanger-on with an emo haircut. I watched qualified, passionate people worked nearly to death while mindless talking heads were coddled. I listened to Lou Dobbs play the loud-mouthed fascist demagogue, Nancy Grace fake ratings-baiting indignation, and Glenn Beck essentially do nightly stand-up -- and that's not even taking into account the 24/7 Vaudeville act over at Fox News. I watched The Daily Show laugh not at our mistakes but at our intentional absurdity.

I mentioned calling Jacki Schechner -- so what did she tell me?

"Think about how frustrated and disillusioned most of the American Morning staff is."

Not simply frustrated and disillusioned, but outright miserable.

And then she reminded me that in the past year-and-a-half, nearly 20 mid to high-level people have left American Morning; many of them quit with no other job to go to -- they just wanted out of the business. That speaks goddamned volumes, not simply about the show but about the state of the entire profession.

CNN fired me, and did it without even a thought to the power that I might wield as an average person with a brain, a computer, and an audience. The mainstream media doesn't believe that new media can embarrass them, hurt them or generally hold them accountable in any way, and they've never been more wrong.

I'm suddenly in a position to do all three, and I know now that this is what I've been working toward the last few years of my career.

Awhile back I was watching a great documentary on the birth of the punk scene, it closed with former Black Flag frontman and current TV host Henry Rollins saying these words: "All it takes is one person to stand up and say 'fuck this.'"

I truly hope so, because I'm finally doing just that.

And I should've done it a long time ago.


BBC Ends English Shortwave Service in Europe
Doreen Carvajal

The BBC World Service, which started its scratchy shortwave transmissions to listeners cut off by “desert, snow and sea” 75 years ago, ended its last English-language shortwave services in Europe on Monday.

The British public broadcaster has been reducing its shortwave transmissions over the last seven years, eliminating services to North America and Australia in 2001 and South America in 2005. Last March, the BBC started reducing European transmissions, finally cutting off a transmitter on Monday that reached parts of Southern Europe.

“There comes a point where the shortwave audience in a given region becomes so small that spending money on it can no longer be justified,” the broadcaster said in a statement.

The quiet ending for the service was a contrast with its celebrated arrival. Seventy-five years ago, King George V helped promote the new technology from his small study in the British royal family’s Norfolk retreat, Sandringham. In a speech written by the poet Rudyard Kipling, the king extolled radio as a way to reach out to men and women isolated by snow and sea.

“Through one of the marvels of modern science, I am enabled this Christmas Day to speak to all my people throughout the empire,” the king said.

The abdication speech of Edward VIII was broadcast on shortwave, as was news of the Hindenburg airship’s explosion and Hungarian Free Radio’s last anguished call for aid as Russian tanks rumbled into Budapest.

But modern modes of communication have been squeezing out shortwave services in Western countries, where programming is available on FM radio, on the Internet and on iPods with wireless connections.

“Europe is very developed and so is America,” said Michael Gardner, a spokesman for BBC World Service. “Shortwave is not the best way of reaching those audiences there. They all have FM, AM stations close by. Some of them have satellites, or they can pull it down on their TV screens and there are alternatives online. There are lots of ways of interacting with the BBC.”

Simon Spanswick, chief executive of the Association for International Broadcasting in London, said that the move by the BBC “probably sounds the death knell for traditional analog shortwave broadcasting in the developed world.”

Shortwave transmissions remain an important media outlet in Africa and Asia, he noted. Since 2006, the BBC World Service shortwave audience has grown by 7 million people, or 7 percent, to 107 million, about 58 percent of the BBC’s total radio audience.

All of the world’s largest international broadcasters, based in the United States, France, Germany, England and the Netherlands, are cutting back on shortwave or reviewing the deployment of their resources.

Andy Sennitt, a media specialist with the Dutch public broadcaster, Radio Netherlands Worldwide, said that he got his start 30 years ago working on BBC shortwave broadcasts and had mixed feelings about the end of the transmissions.

“For die-hard shortwave listeners, this is negative,” he said. “What they don’t understand is the huge cost of powering transmitters. The cost of diesel fuel has doubled.”

iPlayer Usage Effect - A Bandwidth Explosion
Dave Tomlinson

There’s been a lot of talk in the media about the BBC’s iPlayer in the past few weeks with stories on The Register such as this and this, The Guardian here and here, ThinkBroadband, Screendigest, ZDNet, and hundreds more on other places too, some of which are linked here.

There’s also been lots of talk about the availability of iPlayer, there’s news about plans for the Mac version and a US version too is apparently on the way.

We, though, can give a different perspective, a bit of insight on things and maybe explode a few myths. Here’s just a few headlines:

• 5% growth in total average usage since 1st December
• 66% growth in volume of streaming traffic since 1st December
• 2% growth in the number of customers using their connection for streaming since 1st December
• 72% growth in the number of customers using over 250MB of streaming in a month since December
• 100% growth in the number of customers using over 1GB of streaming in a month since December
• Cost of carrying streaming traffic increased from £17,233 to £51,700 per month

So how did we get to these headlines? Well, through our traffic management systems we get a lot of visibility of how our customers are using their connections. We classify iPlayer as streaming so when customers look at the View My Broadband Usage tool they can see the split of traffic types and see how much streaming they’ve used. From our reports we can see that in detail across all our customers and spot patterns and trends as well as providing invaluable data about how the network performs and how customers use the Internet.

A few stats first, 23,441 of our customers used over 250MB of streaming (download only) in January, with a mean of 947MB between them. That’s up from 13,569 customers that did more than 250MB in December (with a mean of 856MB) and going back a year 12,225 did over 250MB with a mean of 781MB in January 2007.

6,083 customers streamed more than 1GB of data in January 2008 (2.2GB mean) against 3,045 in December (2.1GB mean) and 2,253 in January 2007 (2.1GB mean).

We’ll cover off some more stats below but the summary is that more people are streaming and streaming more.

Previous posts we’ve made have focussed on changing usage habits and new applications such as the aforementioned iPlayer.

This post is kind of about putting those together and looking at the effect that new applications are having on usage and where this is leading us.

We’ve been doing a lot of analysis of customer usage of late, trying to understand in ever more detail about how our customers are using their connections and also when they are using their connections.

One thing we’ve noticed is that the mean usage is on the way up and in particular the type of usage is streaming and it’s being used more in an evening.

I’ll illustrate this firstly with a little data. Each month we produce a breakdown of usage and supply it to the PlusNet usergroup (November and December’s data is here).

Just using one of the figures, the mean usage per customer over the past few months is as follows:

June 2007 6.40GB
July 2007 6.54GB
August 2007 6.46GB
September 2007 6.35GB
October 2007 6.61GB
November 2007 6.55GB
December 2007 6.42GB
January 2008 6.74GB

It’s not unexpected to see a small decrease in June, September, November as those months only have 30 days and also in December because of Christmas but the January increase is certainly a noticeable increase whichever month you compare it to. Note that the BBC launched the iPlayer on Christmas day and have been heavily promoting on TV ever since.

When you break that usage down though into different protocols, it’s streaming that’s seeing the big increase.

The following graph shows mean streaming usage (download only) across the past 3 months (1st November to 31st January) in MB per hour per customer for 5 hours of the day (each line represents a particular hour).

As you can see in early November on average customers that were using streaming used around 2 - 2.5MB per hour but by the end of January that had increased to 3 - 4MB per hour.

There’s also a graph of the number of customers that used streaming in each particular hour.

We can also compare this to web browsing/instant messenger traffic with again both the MB per hour per customer and number of customers using that type of traffic per hour.

The web traffic over the same time period is roughly static in terms of MB per hour per customer and the number of customers using that type of traffic increasing a little in line with customer growth (apart from a dip at Christmas).

(Note, this data is taken from the Ellacoya traffic management systems and will include any customer that used any amount of streaming in each hour whether that was 1 byte or 1GB or any other amount).

For another bit of comparison here are the usage graphs for P2P and Usenet and gaming. The P2P and Usenet graphs “spike” because when the network is quieter such as Friday and Saturday nights or over Christmas when there’s more bandwidth available for these types of application. Also again the graphs include anyone that did at least 1 byte of P2P or Usenet during each hour and Usenet will include text as well as binary usage.

We also have a split of the streaming usage into each of the different products.

This graph is showing streaming over the last 2 months for one particular hour (6 - 7pm).

As you’d probably expect, BBYW 3 and 4 have the highest usage but there’s a general increase across each account type.While this graph shows the same time period but the number of customers on each product type using streaming.

What’s quite telling is that not only is there an increase over the last 2 months of customers using streaming but that there’s an increase on Broadband Plus and Premier as well as BBYW which are both accounts we no longer sell and as such the total number of customers on these products is declining.

Here’s another breakdown of the usage. Just looking at residential accounts, in November 174,779 customers had usage in streaming, using a total of 33,189GB which works out as a mean of 190MB per customer for the month.

In December 177,093 customers had usage in streaming, using a total of 31,859GB or a mean of 180MB per customer for the month. This was likely reduced from November because of Christmas.

However, in January 181,108 customers had usage in streaming, with a total of 52,970GB or a mean of 292MB per customer for the month.

That’s a total increase of 66% in January against December, 60% against November. Per customer the increase is 62% up in January against December and 54% up against November. (A combination of natural customer growth and more existing customers using streaming that hadn’t previously would account for the higher increase in the total above the per customer figure).

Ian’s spoken earlier about future developments in set top boxes and particularly of relevance here are the boxes (and TVs themselves) that can combine streaming over the Internet along with Freeview, etc. At the moment the majority of this growth in traffic will be down to iPlayer (with some 4OD, Sky Anytime and Joost thrown in) and likely most people will be watching it on their PCs. We can only imagine what the growth will be like when that majority shifts from the PC to the TV.

The growth though of this type of traffic does add a couple of factors to our product design, we design each of our products around a certain amount of usage and make assumptions about how that usage is used. For example, Broadband Your Way Option 2 has a usage allowance of 8GB which is counted over the hours of 8am to midnight. It may be though that a large percentage of the customers on BBYW Option 2 use more of their 8GB than before (or go over the 8GB and buy additional usage) and use that extra usage in the evening.

This ties perfectly in with the myth of unlimited broadband. On BBYW, as customers use more, the revenue we receive will increase. The amount of additional usage (along with customer numbers and mix of product) is one of the factors we use in determining the amount of capacity we require so we factor in the extra revenue gained from customers using more due to something like iPlayer and provision the capacity necessary.

We aren’t saying that the growth of streaming isn’t a scary proposition, and where there’s one thing there’s bound to be another thing on the horizon (set top boxes, Project Kangaroo from BBC, ITV and Channel 4, iTunes movie rentals and HD movies to name just a few of things that are on the way) but it’s got to be even more scary for some.

Study: More US Broadband has $134 Billion Economic Impact

An increase of 7 percent broadband adoption would mean $134 billion for the US economy, a study says.
Grant Gross

A modest increase in U.S. broadband adoption would have an annual economic impact of US$134 billion, according to a study released Thursday.

A 7 percent increase in broadband adoption would create 2.4 million jobs across the U.S., would save $662 million in health-care costs and $6.4 billion in vehicle mileage, among other savings, according to the study, released by Connected Nation, a nonprofit group focused on improving broadband adoption across the U.S.

A broadband stimulus package would pump nearly as much money into the U.S. economy as an economic stimulus package recently passed by the U.S. Congress, said Brian Mefford, Connected Nation's CEO. A proposal being considered as part of a farm bill before Congress would allow immediate depreciation for investment in broadband infrastructure and "provide a jolt to the nation's economy in the near term," Mefford said.

Some lawmakers and conservative think tanks have opposed calls to create a wide-ranging national broadband policy, Mefford said. However, the Connected Nation model, patterned after a program in Kentucky, focuses more on broadband adoption and local needs than huge, government-funded programs, he said. "It's a consensus-type approach," Mefford said.

The ConnectKentucky model that spawned Connected Nation is "bringing in jobs," said Mark McElroy, Connected Nation's chief operating officer and senior vice president for communications. Through ConnectKentucky, the state has adopted broadband 7 percent faster than it would have without the program, according to the organization.

The Connected Nation study estimates the U.S. would gain $92 billion in new wages from the 2.4 million jobs created through broadband growth. Using broadband for health-care services has saved an average of more than $200 per person per year in Kentucky, and residents there drove more than 100 fewer hours per month because of transactions done online, according to the study.

In addition to the health-care and mileage savings, U.S. residents would save 3.8 billion hours a year by conducting transactions online, at a cost-savings of $35.2 billion, according to the study.

Kentucky was one of the lowest states in the nation for broadband adoption when ConnectKentucky began in 2002, Mefford said. In January 2004, only 60 percent of Kentucky residents had access to broadband; at the end of 2007, 95 percent did, according to the study.

Several Kentucky businesses have benefited from the increased access, according to Connected Nation. Geek Squad, the Best Buy subsidiary, moved its headquarters to Bullitt County, Kentucky, in late 2006 because of the broadband availability, according to Connected Nation.

The U.S. government should focus on public-private partnerships to extend broadband to the remaining areas that do not have it, many of them being low-population rural areas, Mefford said. "These remaining areas are extremely difficult to reach."

Three bills now in Congress, the Connect the Nation Act, the Broadband Data Improvement Act and the Broadband Census of America Act, would replicate parts of the ConnectKentucky model on a national scale.

Not everyone is a fan of ConnectKentucky, however. Public Knowledge, a digital rights group, has raised concerns that ConnectKentucky is "nothing more than a sales force and front group" for telecom provider AT&T, said the group's communications director, Art Brodsky, in a January blog post. Officials that set up ConnectKentucky "ignored municipal utilities, competitive telephone companies and Internet service providers," Brodsky wrote.

Connected Nation has denied that it's a front for AT&T, saying the company has provided less that 1 percent of the organization's revenues.

Connected Nation's focus is on increasing broadband adoption, not on who provides the broadband, Mefford said Thursday. "This is not a 'Field of Dreams' kind proposition," he said. "You don't just string wires or create wireless footprints and think that economies are going to magically turn themselves around. The impact does not occur until we have people using the technology."

U.S. Telecom Growth Seen Slower than Global Industry

The U.S. telecommunications industry will grow at a slower rate than the global industry in the coming years as the wireless and wired markets mature, the Telecommunications Industry Association said on Friday.

According to a study commissioned by the TIA, the U.S. telecom industry will grow at an average annual rate of 7.2 percent in the period 2008-2011, reaching $1.3 trillion in 2011, compared with an average rate of 10 percent, reaching $3.6 trillion, for the rest of the world.

Growth in the U.S. industry will accelerate to 9.3 percent in 2008 from 8.3 percent in 2007, partly due to spending on network upgrades and a government spectrum auction. Growth is expected to moderate in the following years, the report said.

"License fees associated with the 700 MHz auction will boost revenue in 2008, and the absence of that revenue will lead to a sharp drop in 2009," it said.

The biggest U.S. telephone companies are Verizon Communications Inc and AT&T Inc.

While the authors of the study said industry growth could slow in an economic downturn, particularly if enterprise customers cut spending, they did not assume a severe economic impact on the telecom sector in their forecasts.

"In contrast with 2000 and 2001, telecom is not at the heart of the downturn," said Arthur Gruen of Wilkofsky Gruen Associates, which conducted the study.

Gruen, in a conference call with reporters, also said that while telecom is not immune, he is "not expecting a meltdown or anywhere near that."

He noted that even though the U.S. economic outlook has worsened since the research for the study was carried out in the fall and summer of 2007, enterprises have not shown any signs of slowing down spending on installing new phone systems.

The study expects the strongest 2008-2011 growth in the Asia-Pacific region, with a 13 percent annual advance, followed by 11.1 percent for the Middle East and Africa and 10.5 percent for Latin America.

European growth will be just ahead of the United States at 7.5 percent annually, while Canada is expected to be the slowest region with 5.4 percent annually.

According to the study, about 35 percent of U.S. wireless service revenue will come from data services such as mobile Web surfing in 2011, up from 16 percent in 2007.

With Web traffic for services such as Internet video soaring, the study found that in wired networks "current capacity will soon be unable to support bandwidth demand."

This is in contrast with the commonly held view in 2003 that "there would be excess network capacity for the foreseeable future."

(Reporting by Sinead Carew; editing by John Wallace)

Super-Speed Internet Satellite Blasts Off in Japan

Japan launched a rocket Saturday carrying a satellite that will test new technology that promises to deliver "super high-speed Internet" service to homes and businesses around the world.

The rocket carrying the WINDS satellite -- a joint project of the Japan Aerospace Exploration Agency (JAXA) and Mitsubishi Heavy Industries -- lifted off its pad at 5:55 p.m. (0855 GMT).

If the technology proves successful, subscribers with small dishes will connect to the Internet at speeds many times faster than what is now available over residential cable or DSL services.

The Associated Press said the satellite would offer speeds of up to 1.2 gigabytes per second.

The service initially would focus on the Asia-Pacific region close to Japan, a JAXA news release said.

"Among other uses, this will make possible great advances in telemedicine, which will bring high-quality medical treatment to remote areas, and in distance education, connecting students and teachers separated by great distances," JAXA said.

The rocket was launched from Japan's Yoshinobu Launch Complex at the Tanegashima Space Center.

Silicon Valley Losing Middle-Wage Jobs
John Markoff

Silicon Valley is in danger of creating its own digital divide.

The California region is losing its middle-class work force at a significant rate, according to an annual report that tracks the economic, social and environmental health of the region that is the nation’s technology heartland.

The 2008 Index of Silicon Valley — which this year was sponsored by Joint Venture: Silicon Valley Network, a public-private partnership, and the Silicon Valley Community Foundation, a nonprofit — found that from 2002 to 2006, middle-wage jobs fell to 46 percent of the work force, from 52 percent.

At the same time, while the percentage of higher-end jobs rose slightly — to 27 percent from 26 — lower-wage jobs expanded to 27 percent, from 22 percent of the work force. In all, more than 50,000 middle-income jobs have disappeared over the four years measured by the study.

The vanishing jobs — defined as those paying $30,000 to $80,000 — represent workers who had been in the lower part of the white-collar pyramid, including secretaries, clerks and customer support representatives. The picture was blurred, however, by growth in some blue-collar, middle-income professions like electricians and plumbers, and several white-collar areas like computer support technicians.

The consequence of the shift may undercut some of the basic mechanisms of the Valley economy, according to the authors of the report, by making upward mobility more difficult.

“If you lose the middle, it’s harder to support the top,” said Doug Henton, an economist at Collaborative Economics, a research and consulting firm in Mountain View, Calif., that helps prepare the annual report.

The short-range outlook for the region appears to be more positive, with the overall pace of job gains outpacing the nation’s.

For example, for the first time since 2001, when the dot-com sector was imploding, median household income rose. Silicon Valley added 28,000 jobs, for an increase of 1.7 percent in 2007. Over all, the region is far more wealthy than the rest of the country, with per capita income 57 percent higher than the national average.

Despite fears of losses in the wake of the Sept. 11 attacks, the region continues to see a healthy in-flow of talent from outside the United States. More than 17,000 foreign citizens moved to the region last year, reversing a decline since the number peaked in 2001 at above 30,000.

Forty-eight percent of the households of the region speak a language other than English in the home.

Reflecting the changing boundaries of what is defined as Silicon Valley, this year the authors of the report added all of San Mateo County’s work force. It was the first change to the definition of the region by the study, which was first published in 1995. By moving the northern border of the Valley past the San Francisco airport, the area now reflects more of the biotechnology orientation of companies like Genentech. The region does not include San Francisco.

Venture capital investment continued to climb at a healthy clip during 2007, rising by 11 percent. Sixty-two percent of the so-called clean tech venture investment for California was invested in Silicon Valley during the year.

The Valley continues to stand apart because it is a center of technical innovation, said Russell Hancock, president of Joint Venture. But he also said it was unlikely that the region would be unaffected by a recession or the subprime mortgage crisis.

Still, the researchers behind the study said the Valley was distinguished by the flexibility of its economy and its ability to adapt to changing conditions.

“What we’re talking about is a Valley that continues to reinvent itself, and it’s not in any one sector,” Mr. Henton said.

One notable category in which the region lags behind its international competitors is home broadband networks. Only 51 percent of the region has access to broadband Internet — defined as more than 200 kilobits per second. In contrast, 65 percent of the households in Japan and 94 percent in South Korea are wired to at least that speed.

Honest To Blog: Juno is the Most Successful Indie Film in Six Years; DVD Details
Peter Sciretta

Fox Searchlight’s Juno has now grossed over $143.1 million worldwide ($125M domestic), making the film the most successful independent movie since 2002’s My Big Fat Greek Wedding (which grossed $241.4M domestically). Playing on 1,865 screens, the film continues to make over $6 million weekly. Variety also reports that “Juno also has the distinction of being the only film this year to remain on the top-10 box office chart every weekend since its debut.”

Now one could argue that Juno isn’t a independent movie because it was produced by a mini major movie studio. One could also argue that the film was made for next to nothing ($7.5 million) and was distributed in a platform release which depended on word of mouth. Either way, that argument is for another day, everyone who is anyone considers it an indie.

Fox Searchlight has announced that the little film that did will hit DVD store shelves on April 15th 2008. Fox Searchlight will release the film in 1-disc and 2-disc special edition versions, and on Blu-ray disc. The single disc release will include the film in 1.85:1 anamorphic widescreen, English Dolby Digital 5.1, an audio commentary by director Jason Reitman And writer Diablo Cody, 11 deleted scenes, a gag reel, a Cast & Crew Jam (whatever that means), and screen tests. The 2-disc special edition will include all of the previously mentioned features, plus 4 featurettes (Way Beyond “Our” Maturity Level: Juno – Leah – Bleeker, Diablo Cody Is Totally Boss, Jason Reitman For Shizz, and Honest To Blog! Creating Juno). The Blu-Ray release will include a English 5.1 DTS HD Lossless Master Audio, everything in the two disc special edition, a Fox Movie Channel Presents: Juno World Premiere and Fox Movie Channel Presents: Casting Session featurettes.

Meanwhile, And The Winner Is’ Scott Feinberg is predicting a Juno win for Best Picture and Diablo Cody for Best Screenplay.

In a Corrupt World Where the Violent Bear It Away
Dave Kehr

HE has 60 titles to his credit, ranging from one-reel shorts to international epics, with an Academy Award-wining documentary along the way (the 1947 feature “Design for Death”). But Richard Fleischer remains among the least known and least honored of major American filmmakers, in part because of the sheer volume of his output. Even the most conscientious critic has a hard time picking through the many impersonal projects — films like “Doctor Dolittle” with Rex Harrison (1967), or the 1980 remake of “The Jazz Singer” with Neil Diamond — to uncover the core of his achievement.

Fleischer, who died in 2006, still has not been given a major New York retrospective, but three of his best films will be turning up in the next couple of weeks. The annual Film Comment Selects series at Lincoln Center will include his “10 Rillington Place” (1971) and scandalous “Mandingo” (1975) this week, while “Violent Saturday,” his 1955 color and CinemaScope film noir, will begin a weeklong run at Film Forum on Feb. 29.

Systematically chosen or not, these three films represent a fairly wide range of Fleischer’s meticulous work. Filmed in England and set in the dim, drab postwar London that David Cronenberg recreated for “Spider,” “10 Rillington Place” (Thursday and Feb. 24 at the Walter Reade Theater) belongs to a series of films that Fleischer devoted to serial killers, a term that had barely entered the language when he made his first, “Follow Me Quietly,” for RKO in 1949. His “Compulsion,” based on the Leopold and Loeb “thrill kill” murder of a Chicago schoolboy, appeared in 1959, and “The Boston Strangler” followed in 1968, with Tony Curtis as a plumber accused of the rape and murder of a series of women.

Unlike the current strain of serial killer films, from “The Silence of the Lambs” to “Saw IV,” Fleischer’s don’t invite the spectator to identify surreptitiously with the power and impunity of the murderer, but neither are they simple expressions of moral outrage. They focus, with sober detachment, on the details of crime and the working of the criminal mind, expressing no more shock than would a documentary on the functioning of the Ford assembly line.

Fleischer’s killers are ordinary men (or boys, in the case of “Compulsion”), physically undistinguished and almost faceless (literally so in the case of the haunting “Follow Me Quietly,” in which a detective constructs a blank-faced dummy to take the place of the murderer, a phantom stalker known as “the Judge”). They blend easily into Fleischer’s carefully observed backgrounds, none more smoothly and deceptively than John Reginald Christie (Richard Attenborough) of “10 Rillington Place,” the London landlord (and real-life figure) who raped and murdered several women and allowed the husband of one victim (played by a young John Hurt) to be hanged in his place.

Violent death may seem a strange preoccupation for the son of Max Fleischer, the pioneering animator who produced “Betty Boop” and the best of the “Popeye” cartoons (directed by Dave Fleischer, Max’s brother and Richard’s uncle). But animation has always had its morbid, nightmarish component, and seldom more than with the Fleischers. (There are few films more disturbing than the Fleischers’ “Snow-White” of 1933, with its chorus of “St. James Infirmary Blues.”)

Whereas his father and uncle worked in fantasy, Richard Fleischer became one of the earliest un-self-conscious realists of American film. With extensive location work (perhaps mandated by minuscule budgets), Fleischer’s RKO B-movies — “Bodyguard” (1948), “The Clay Pigeon” (1949), “Trapped” (1949, made on loan to Eagle-Lion), “Armored Car Robbery” (1950) and “The Narrow Margin” (1952) — function as documentaries on a lost Los Angeles, given tension and style by Fleischer’s constant reframing of the action and elaborate camera movements.

At first “Violent Saturday,” the first of Fleischer’s many films for 20th Century-Fox, seems like a simple extension of the RKO noirs into widescreen color. Its setting is a Midwestern mining town laid out in an open, horizontal space that contrasts with the urban canyons of the RKO films. But here Fleischer is less interested in the aberrations of a single personality than in the unhealthy interactions of an entire society.

The town is a coiled spring of sexual and social tensions: a bank president (Tommy Noonan) who moonlights as a peeping Tom; a millionaire’s son (Richard Egan) whose wife is openly carrying on an affair; a mine engineer (Victor Mature) whose son is ashamed of him for failing to serve in World War II. When the criminals appear (Stephen McNally, J. Carrol Naish and Lee Marvin) with the intent of knocking over the local bank, they seem like projections of the town’s inner anxieties. The violence they trigger is harsh and cleansing, a deliverance as much as a judgment.

For the French critic Jacques Lourcelles, one of Fleischer’s most articulate admirers, the recurring theme of his work is society slipping into decadence. That theme is as apparent in “Violent Saturday” as in Fleischer’s matinee classic “The Vikings” (1958), the Gilded Age melodrama “The Girl in the Red Velvet Swing” (1955) or even in his 1973 science fiction film “Soylent Green,” with its grim vision of an end-times America. But Fleischer’s most provocative film on this theme is the still potent “Mandingo” from 1975 (Feb. 23, Walter Reade Theater), an anti-“Gone with the Wind” that treats the pre-Civil War South as a swamp of degradation for white masters and black slaves alike.

Rattling around a tumble-down Tara of peeling plaster and near-empty rooms, James Mason (Captain Nemo in Fleischer’s children’s classic “20,000 Leagues Under the Sea”) presides over a human breeding farm. He is as occupied with finding a suitable stud for his prize female slave as with finding a bride who will give his lame son (Perry King) the male heir he requires.

The treatment of humans as so much chattel, to be bought, sold and cruelly abused regardless of their social position, makes “Mandingo” a thinly veiled Holocaust film that spares none of its protagonists. When “Mandingo” was released, many critics erupted with rage over its aggressively tasteless portrayal of the slave-owning South, which seems in retrospect both a desired and appropriate response. More than a portrait of social decadence, “Mandingo” is Fleischer’s last great crime film, in which the role of the faceless killer is played by an entire social system.

The Dreamer as Tapehead
A. O. Scott

In its sweet, lackadaisical way, Michel Gondry’s “Be Kind Rewind” illuminates the pleasures and paradoxes of movie love. Its two main characters, a pair of Passaic, N.J., loafers named Mike and Jerry, are devotees of the Hollywood mainstream, paying tribute to well-worn classics like “Ghostbusters,” “Driving Miss Daisy,” “Rush Hour 2” and “The Lion King.” The way they express this affection lands Mike and Jerry in a spot of copyright trouble, but they (and Mr. Gondry) provide a welcome reminder that even the slickest blockbuster is also a piece of handicraft, an artifact of somebody’s nutty, unbounded ingenuity and the potential object of somebody else’s innocent, childlike fascination.

Mike (Mos Def) works in a shabby video store whose owner, Mr. Fletcher (Danny Glover), has not yet made the leap to DVD. His business threatened by the dubious improvements of a city-backed redevelopment scheme, Mr. Fletcher sneaks away on a mysterious trip, leaving the blundering, well-intentioned Mike in charge of his stock of battered VHS cassettes. Jerry (Jack Black), an avant-garde auto mechanic and tireless tinkerer, suffers an accident that magnetizes his body, causing him to accidentally erase all the tapes.

So when a loyal customer named Miss Falewicz (Mia Farrow) shows up for her daily rental, Mike and Jerry must improvise. They do what anyone would: hurriedly reshoot famous movies using a camcorder, various local characters and some common household objects.

Of course, not everyone would or could figure out how to turn pizza pies and cardboard boxes into special effects. Mr. Gondry is a highly skilled and practiced professional, a visual magician responsible for such enchantments as “Eternal Sunshine of the Spotless Mind” (in collaboration with Charlie Kaufman), “Dave Chappelle’s Block Party” (with Dave Chappelle) and “The Science of Sleep” (all by himself). But as tricky and refined as his techniques may be, the spirit in which he deploys them is delightedly amateurish and winningly democratic. In the world of his films drab city neighborhoods are zones of oddity and wonder, their possibilities waiting to be unlocked by accident or whim. Daily life is a series of art projects waiting to happen.

“Be Kind Rewind” is pervaded by an easy, occasionally antic good humor. Like “The Science of Sleep,” it meanders occasionally toward melancholy or misunderstanding, but for the most part avoids conflict or intense feeling. In their speech patterns and styles of behavior, Mos Def and Mr. Black seem like a couple of overgrown 12-year-olds, and Alma (Melonie Diaz), the young woman who joins their cinematic enterprise, seems less like a potential love interest than a girl given permission to enter the secret clubhouse.

In any case, Mr. Gondry’s shaggy-dog neighborhood chronicle is really a loose frame for Mike and Jerry’s creations, and for the exquisite black-and-white Fats Waller biopic that turns out to be their masterpiece. Miss Falewicz, who has never seen “Ghostbusters,” is glad to be fooled by the clumsy, highly foreshortened version that Mike and Jerry send her home with. But their way of remaking movies — called “Sweding” for no very compelling reason — catches on even with customers who know better, and before long lines are forming around the block.

And why not? At the “Be Kind Rewind” Web site (bekindmovie.com), Mr. Black’s voice defines Sweding as “putting YOU into the thing you like,” and there is a quiet strain of populist defiance buried in Mr. Gondry’s wonder cabinet. Commercial pop culture is, too often, understood as a top-down enterprise, its expensive, disposable products passively consumed by the public.

And yet at the same time that stuff is capable of inspiring a deep and durable sense of ownership. The movies we love belong in some profound way to us, and part of us lives inside them. Sweding is Mr. Gondry’s way of making that rather abstract sense of connection literal, of suggesting that even if we are not strictly speaking the owners and authors of the movies we like, well, then, perhaps we should be.

It goes without saying that this is a naïve, utopian point of view. The travestied films in “Be Kind Rewind” are the intellectual property of large corporations (as is Mr. Gondry’s movie), and you can be sure that teams of lawyers were consulted and paid before the Sweding went very far. But “Be Kind” hardly pretends otherwise. Instead it treats movies as found objects, as material to be messed around with, explored and reimagined. It connects the do-it-yourself aesthetic of YouTube and other digital diversions with the older, predigital impulse to put on a show in the backyard or play your favorite band’s hits with your buddies in the garage.

And the deep charm of Mr. Gondry’s film is that it allows the audience to experience it with the same kind of casual fondness. It is propelled by neither the psychology of its characters nor the machinery of its plot, but rather by a leisurely desire to pass the time, to see what happens next, to find out what would happen if you tried to re-enact “Ghostbusters” in your neighbor’s kitchen. It’s inviting, undemanding and altogether wonderful. You’ll want to see it again, or at least Swede it yourself.

“Be Kind Rewind” is rated PG-13 (Parents strongly cautioned). It has some swearing and Sweded sex and violence.


Opens on Friday nationwide.

Written and directed by Michel Gondry; director of photography, Ellen Kuras; edited by Jeff Buchanan; music by Jean-Michel Bernard; production designer, Dan Leigh; produced by Mr. Gondry, Julie Fong and Georges Bermann; released by New Line Cinema. Running time: 1 hour 41 minutes.

WITH: Jack Black (Jerry), Mos Def (Mike), Danny Glover (Mr. Fletcher), Mia Farrow (Miss Falewicz), Melonie Diaz (Alma), Chandler Parker (Craig), Irv Gooch (Wilson), Arjay Smith (Manny), Marcus Carl Franklin (Kid 1), Blake Hightower (Kid 2) and Amir Ali Said (Kid 3).

Film Group Sues China Web Site Accused of Aiding Online Movie Piracy

A Hollywood group said Friday it is suing a popular Chinese Web site over film piracy, expanding a legal battle over use of the Internet by China's thriving industry in product copying.

The Motion Picture Association accused Xunlei Networking Technology Co. of allowing users of its file-sharing service to download hundreds of movies from other Web sites despite repeated warnings. The group said it is seeking 7 million yuan, or about $1 million.

Industry groups say explosive growth in Internet use in China is fueling unlicensed copying. Pirate Web sites offer free music, movies, software or games to attract users and make money from advertising or online commerce.

Popular Chinese Web sites also have been sued over accusations that they link to sites that carry pirated music.

MPA accused Xunlei of allowing users of its peer-to-peer, or P2P, service to download copies of movies including "Spider-Man 3," "War of the Worlds" and "Miami Vice." It accused Xunlei of continuing to allow violations after the group's lawyers sent 78 warnings.

"These actions demonstrate that copyright holders can and will vigorously defend their property by any legal means," Frank Rittman, the MPA's Asia-Pacific vice president, said in a statement.

"P2P piracy is a huge problem in China, which if left unattended will threaten the continued development of legitimate online services supported by copyright owners," Rittman said.

A woman who answered the phone at Xunlei's headquarters in the southern city of Shenzhen and refused to give her name said no one was available to comment.

The MPA also has filed a series of lawsuits against Chinese vendors of illegally copied DVDs. The group says it has been awarded 2 million yuan ($280,000) since 2006.

Entertainment and games are among the most valuable attractions for Web sites in China, which has 210 million people online, the second-largest population of Internet users after the United States.

In November, the MPA sued a Chinese Web site, Jeboo.com, that it accused of providing pirated copies of 13 recent Hollywood films to a Shanghai Internet cafe.

A music industry group, the International Federation of Phonographic Industries, won a suit in December against Yahoo Inc.'s China arm, which it sued over links to outside sites with pirated music. The group has filed a similar suit against Chinese search engine Baidu.com Inc.

China is a leading source of unlicensed copies of goods ranging from movies and music to sporting goods and medications.

Beijing has imposed tougher penalties and launched repeated crackdowns, but companies say violations, driven by a booming Chinese economy, are expanding faster than enforcement.

The Motion Picture Association is the international arm of the Los Angeles-based Motion Picture Association of America. Its members are Walt Disney Co.'s Buena Vista Pictures Distribution, Paramount Pictures Corp., Sony Pictures Entertainment Inc., Twentieth Century Fox Film Corp., Universal City Studios LLLP and Warner Bros. Entertainment Inc.

Another Look At The 'Does File Sharing Equal Stealing?' Question
Mike Masnick

Jon Healy, whose writing for the LA Times I admire quite a bit, has written up a very balanced discussion concerning whether or not file sharing equals theft. He links to some of my writings on the subject, as well as pointing to the views of two Nobel Prize winning economists, F.A. Hayek and Milton Friedman, who both point out that copyright is not property, and treating it as such causes problems. He then presents the entertainment industry's view, which (of course) is that copyright is no different than traditional property. Then he brings in legal scholar Mark Lemley (of whose work I'm also a fan) who tries to bridge the gap by noting that copyright isn't property, but that infringing it "is wrong, and should be punished." However, Lemley also points out that most people recognize copyright isn't traditional property, and the entertainment industry's insistence that they're the same works against the industry, as most people recognize immediately that this argument is false, taking away credibility.

Healy comes out on the balanced side himself, suggesting that infringement is close enough to theft. He does so by comparing it to "theft of service" for cable companies, and noting that "you're still acquiring something of value without paying for it, and you're doing it without the seller's permission." This is a commonly used argument, and seems reasonable at a first pass, but I'd like to address why it's incorrect. Just because you acquire something of value for free (and without the original seller's permission) it doesn't automatically make it "theft." Let's run through some examples:

• I go to the pizza shop and they offer me a free soda with two slices. The soda has value, but I just got it for free, and did so without Coca-Cola granting permission. I don't think anyone would claim this is stealing or even wrong or immoral.
• My friend lets me borrow a book, which I read. The book has value. I got it for free, without the permission of the book author or publisher.
• I get on a train and pick up the newspaper that a passenger left behind. The newspaper has value. I got it for free, without the newspaper company granting permission. I don't think anyone would claim that's stealing.
• I go to the beach. The people sitting next to me are playing music on their stereo, that I can hear. The music has value, but I just got it for free, without the permission of the record label.
• I go see "Shakespeare in the Park." I get to see something of great value for free, without permission of William Shakespeare.
• Verizon sees that Sprint is going to announce an "all you can eat plan" and decides to introduce its own similar plan. Verizon got that idea for a bundle from Sprint for "free" and certainly without Sprint's permission. Yet, we call that competition, not stealing.

You can come up with your own examples. Now I'm sure people will start picking apart each of these examples. They'll say things like in the pizza/soda example, the pizza shop has implicit permission to resell the soda at any price they deem reasonable, since they paid for it in the first place. But, if that's the case, then we have another problem for those who claim that copyright is real property -- because the same thing isn't true with copyrighted material. Those who insist that copyright is the same as real property break their own rule by also insisting that they retain perpetual rights to the good, even after it's been sold. If copyright were like real property, after the creator sold it, the buyer could do whatever they want with it, including giving it out for free. Yet, it clearly is not like that. Coca-Cola sold soda to the pizza shop and the pizza shop can do whatever they want with it, including giving it out for free. So, if the entertainment industry wants to keep insisting that copyright is just like real property, and therefore infringement is theft, then they should also agree to let anyone who has bought their works do whatever they want with them, including give them away for free.

In fact, each "but, this is different because" explanation for the examples above can easily be turned around to prove the point that copyright is different than real property -- because it applies the same rules differently and deals with fundamentally different types of goods or services. What it really comes down to, yet again, is that this is a business model problem. For years, an industry that relied on artificial scarcity is discovering that it's hard to keep that artificial barrier in place. It can't pretend something is scarce when it's really infinite -- and trying to limit it will only backfire in the long run. What you need to do, instead, is figure out new business models that embrace the infinite nature of the goods, and focus on selling additional scarce goods, preferably additional scarce goods that are made even more valuable by freeing up the infinite good.

File ‘Sharing’ or ‘Stealing’?

The semantic debate over whether copyright infringement is theft.
Jon Healey

A few days ago I came across an Op-Ed submission that called for file sharing to be decriminalized. The editors here decided not to run it, but it intrigued me for a couple of reasons. First, the author, Karl Sigfrid, is a member of the Swedish Parliament from the Moderate party — a pro-business party that's akin to this country's Libertarians (except in Sweden they're more than just a fringe group). Second, although he covered much of the same ground earlier this year in a Swedish paper, Sigfrid's new piece added another provocative contention: that unauthorized downloading isn't actually theft. Here's an excerpt:

In "The Fatal Conceit: The Errors of Socialism", the economist and Nobel Prize winner F.A. Hayek explains the difference between conventional property rights and copyright. While the supply of material resources is limited by nature, the supply of an immaterial good [is] unlimited, unless the government limits the supply by law…. A later Nobel Prize winner, Milton Friedman, describes copyright as a monopoly that decreases supply to a level below the optimal level. Copyright and the regulations that follow from it should, according to Friedman, be described primarily as a limitation of free speech.
In essence, Sigfrid is saying that something in unlimited supply can't be stolen. His position is a variation on a theme advanced by Mike Masnick of Techdirt.com, among others: that the entertainment industry's aggressive copyright-enforcement efforts spring from an outdated, analog-era notion of scarcity. Under this view, copyright holders are helped, not harmed, by file sharing and other online distribution pipelines; they just haven't adapted their business models to take advantage of the new opportunities. Supporters of this view include musicians, authors and filmmakers who say that that file sharing helped bring the exposure they needed to sell their works.

These aren't just academic arguments. They're ammunition in a battle that's raging online to shape the way the public thinks about copyrights. The first salvo was fired by the original Napster, which defined itself as a file-sharing network. That won the semantic high ground by defining unauthorized downloading as "sharing," not "copying" or "duplicating." The implication was that users of these networks were merely being generous with something they possessed, not usurping the rights of copyright holders.
Record labels, music publishers and movie studios contend that copyrights are indeed property, entitled to the same protection as a home or a car. To counter the notion of "sharing," they've advanced an equal powerful metaphor: downloading as theft. "When you go online and download songs without permission, you are stealing," the Recording Industry Assn. of America says on its website. "Piracy is theft, and pirates are thieves, plain and simple. Downloading a movie off of the Internet is the same as taking a DVD off a store shelf without paying for it," adds the Motion Picture Assn. of America. The imagery has been echoed by the news media, lawmakers and college administrators. It's even found its way into the online term-paper site FratFiles.com, which offers a model essay, "Illegal downloading 'is' stealing" (yes, there are shortcuts even for ethics assignments).

Nice image, but it's not a perfect fit. As Sigfrid noted, there's a fundamental difference between intellectual property (copyrights, patents, trademarks) and real property (houses, cars, plasma TVs): The latter is tangible and limited in supply, the former is not. "Copyright infringement is not 'theft' in the same way that taking a CD from a store is theft," said Mark Lemley, a copyright expert at Stanford University Law School. "If I take your physical property, I have it and you no longer do. If I copy your song, I have it, but so do you."

Legal scholars aren't the only ones making that point. You'll see it again and again in discussions online about the propriety, morality and economic impact of file sharing. To Lemley, that suggests the entertainment industry's choice of metaphors has backfired. "Let me be clear: copyright infringement is wrong, and should be punished," he wrote in a recent e-mail. "But simplistic statements that infringement is 'just like' stealing a CD, or using a room in my house, are wrong. They are also counterproductive, because people instinctively know they are wrong, and so they are likely to ignore histrionics of this sort."

So what's the right metaphor? Unauthorized downloading may not be larceny, but it still seems to fit under the broad notion of theft. Even though the copies cost nothing to produce, the data in them has value. Downloaders acquire that value without paying for it. Some say they're not causing any real losses because they buy new copies of the downloaded files they like. But that rationalization wasn't persuasive to Supreme Court Justice Stephen Breyer, who flatly declared in his concurring opinion in MGM vs. Grokster, "Deliberate unlawful copying is no less an unlawful taking of property than garden-variety theft."

The downloading-isn't-stealing faction makes much of the fact that infringements don't deprive copyright owners of their works. But that deprivation is not an essential element in every kind of theft. If you splice into your neighbor's cable wire and get 150 channels for free, you're not diminishing the available supply of cable TV or depriving anyone else in the neighborhood of it. But you're still acquiring something of value without paying for it, and you're doing it without the seller's permission. That's calledtheft of service.

Don't expect Hollywood to start likening illegal downloading to stealing cable, though, no matter how well the shoe fits. Cable pirates are heroes in some quarters, not pariahs, and the cable operators' image problems rival those of the RIAA and the MPAA.
More important, copyright owners want the public to view unauthorized downloading as shoplifting because they want intellectual property to be as respected by society just as much as real property is. But there's more at issue here than just the propriety of file sharing. The imagery associated with infringement also affects debates over other aspects of copyrights, such as how long they should last and who should be responsible for stopping piracy. Likening them to real property tilts the debate by making copyrights seem immutable, when in fact they have a specific social goal: "to promote the progress of science and useful arts," as the Constitution states in Article I. Achieving that goal means balancing the interests of content creators against the public's, which is a much more complicated task than erecting a legal barrier to five-fingered discounts.

RIAA Reminds Me of The Mafia, says Musician

Former Dead Kennedys vocalist Jello Biafra has torn into the RIAA, likening them to the mafia, threatening to leave a horse’s head in the beds of old women and children alike, whilst destroying the education of student file-sharers. Don’t even get him started on the media: “Goebbels would be proud” he said.

Born Eric Reed Boucher in 1958, Jello Biafra is no stranger to controversy. He first became well known as songwriter and lead vocalist with the band Dead Kennedys. The band split in 1986 but 1998 saw the start of a six year battle over the royalties to the band’s music. No doubt this was a miserable experience, so maybe Biafra’s outburst this week was to be expected.

In a translated interview with Norway’s Aftenposten entitled “Goebbels Would Be Proud”, Biafra tells us a little bit about how he feels about the RIAA, big record labels and even the media. He isn’t pulling any punches either.

“I have two different opinions on file-sharing” says Biafra, drawing a metaphorical line in the sand - with good (small labels) on one side, and bad (big labels) on the other.

“You may take from the big labels,” he orders, “because the only thing they do is steal from both the artists and the audience.” Not many would disagree with you there, Jello.

The ‘good’ side are the small guys, explains Biafra to potential file-sharers: “Don’t take from the smaller, independent labels. Then fantastic bands would have to surrender way too early, because they can’t afford it,” he says, whilst completely forgetting that popularity fills concerts and downloads are a good way to achieve that these days. According to MAMA Group who manage the Kaiser Chiefs and Franz Ferdinand, future profit is there to be unlocked - and it lies in the live concert. Popularity through free downloads could be the key to these, time will tell.

“Support the independent labels, but the big ones –fuck’em. Anyways, I haven’t found anything in many years which come from a large label worth buying” says Biafra, as he tosses aside his attacks on singular big labels and gets his teeth into the collective might of the RIAA:

“The RIAA reminds me most of the Godfather,” Biafra says, tipping his head to the side and changing his voice to Marlon Brando mode:

“We will sue you. If you want out of this without going to court, we can make an arrangement: Give us $5000. If not, you will find a horses head in your bed.”

Suddenly he is back to being Jello Biafra again, and talks about why RIAA action against file-sharers is wrong: “They are doing this to 12 year old girls, they are doing it to 80 year old women, and they do it to students. There are plenty of examples that show people having to quit school because they had to give all their money to the recording industry instead,” he says gravely.

Biafra then explains that he doesn’t do any downloading himself as he doesn’t have a computer before launching himself at the media: “It’s so dumb, that even the American edition of CNN is just a bunch of right-twisted parrots babbling about the primary elections, letting the war in Iraq pass in silence. Then it is up to the artists to fill the void.”

Then, in a final show of support for the small guy, Biafra concludes: “When smaller performers express their political views they are gagged. But when Mel Gibson or Arnold Schwarzenegger does it, then it’s okay. Because they fit better into the media profile.”

“Goebbels would be proud.”

For those who haven’t seen it yet, here’s a RIAA training video, that may give some insight into the organization.

Many thanks to Håvard

Requiem for an Apple

Cease and Desist

Well, I'm guessing Apple did not like the requiem project that was posted in Technical as the site host received a C&D letter demanding that all downloads be removed from the site. Until further notice, no links are to be posted anywhere on the site to programs that can strip DRM from any of Apple's music or videos. Any user who does so will get the link removed and a warning from us. Any further infraction will get you banned permanently. The site will remain open for now and we won't have a problem as long as we abide by the C&D.

However, on a more personal level this just pisses me off. In no way has this site ever promoted piracy. Those of you who've attempted to discuss such topics know that we take a very heavy handed approach. This was partly to protect us but also because we feel that artists should be compensated for their work. We truly believe that people should be able to free the music they've legally purchased from the shackles of DRM. So, we've attempted through the years to keep a balance of fair use.

Apparently with requiem the balance has been broken in Apple's eyes. This is really a shame...for them. Because I can no longer remove the DRM from songs I purchase legally from iTunes, I am boycotting the iTunes store and purchasing all my future music from vendors who no longer shackle their music with the chains of DRM. I suggest you do the same. We've complied with the C&D and removed all DRM breaking software from the site. But they can't force us to purchase DRM'd music from their store. I've been a long time fan of Apple and iTunes. But this latest move just plain pisses me off. So, I can no longer support them.

Buying The DVD: Unhelpful And Unethical
J.J. King

These last few years P2Pers have got used to TV entertainment ‘our way’: unfucked, de-loused, delivered efficiently in economical, good-looking codecs. Because we rarely turn it on, it’s been easy to forget just how cynical, unsatisfying and downright venal television, as a distribution medium, has become.

Whether it’s the stupor-inducing gambling channels dedicated to parting fools from their money, the late-night pseudo-porn selling premium-rate phone sex, or the corrupt ‘competition’ call-ins plaguing the UK’s prime-time (even that Holy of Holies, the BBC), there’s the unavoidable sense that TV is on the rocks. Anyone who’d have you believe filesharers are the only scourge afflicting an industry that would otherwise be healthy is smoking crack, in the business, or both.

This is why Tape It Off The Internet seemed like such a good idea until you actually started trying to use it. There are just not enough good shows being made to justify something as complicated and involved as TIOTI. Enter all your favorites and share them with strangers ‘just like you’ and discover… what? That there are only seven good shows in the world at any one time, you were already watching six of them, and they’re all in the Pirate Bay’s Top 100 anyway. When you strip away the hours of dross and advertising, the truth is that the world’s mighty entertainment infrastructure is only capable of producing half a dozen hours of passable content a week. Maybe it’s because they spend the rest of their time on lawsuits.

One of these rare hours is The Wire. If by some small chance you’re not mainlining it already, think yourself lucky. You have four back seasons to enjoy, of what is quite possibly the last great show television will produce before it’s entirely superseded by — well, by whatever is coming around the way.

I’m not sure anyone has ever attempted to make a show of this scope: The Wire’s by-all-accounts-not-very-nice creator David Simon (Homicide, The Corner) has said his theme over the series’ five years has been ‘the decline of the American empire’ — which means decay of its cities through poverty, of traditional jobs, of the education system, of the police force and of the media. For those getting restless at the back, the show’s also got the slickest, nastiest drug slingers you’ll see on screen and is so realistic that the Baltimore Police have apparently complained it reveals too much about how crimes are — or are not — solved; apparently real thugs love it as well.

Find it and download it — though probably David Simon doesn’t want you to and neither does HBO, which has been actively poisoning Torrents of its other shows. Tell everyone you know about it. Maybe those of them still rocking TVs will raise the show’s increasingly dismal viewing figures.

Or maybe that’s no longer the point. While I sympathise with the plight of the David Simons, David Milchs (Deadwood, John from Cincinnati) and Joss Whedons (Firefly) of this world, and would like to help them in future endeavors, I specifically do not sympathise with the plights of the craven, dim-witted, played-out producers that surround them on all sides. And by ‘playing fair’ and buying the DVD or the cable package, besides the fact that most of our money is not going to the creators and their families, aren’t we really saying we accept the meshwork of shit in order to get the two or three gems that occasionally sift through it? Aren’t we signalling the industry that there’s something we still find acceptable about their way of doing business?

Now I suppose this could seem a bit extreme to some. But again and again in blogs and comments about shows like The Wire you hear ‘I’d pay for this if…’ — if it wasn’t DRM’ed all to hell like HBO’s own online offering, if it was freely shareable, good to be watched whenever, wherever, on whatever, without constant interruption by adverts. The kicker is that we’re not only unable legally to liberate and re-distribute shows from the broken, corrupt mechanisms of television and DVD distribution: we also have no way of supporting creators like David Simon and crew outside of it.

This means that right now, people still stupid or unfortunate enough to sit in front of TVs watching months-old shows or paying massive cash-or-attention premiums for the new ones are heavily subsidising us P2Pers. This is genuinely immoral, because we’re really exploiting people less fortunate than ourselves. Instead, we should be helping them out of the wasteland, and thinking of new ways to get the creators we like creating outside the prison of mass distribution. It cannot be that we are able to figure out how to make GNU-Linux - a world-class operating system — together, but not to make a dozen decent shows a year.

The irony is that TV series really feel like they’re coming into their own, just as the media that spawned them is dying. From the ‘high art’ of Deadwood and John From Cincinnati to the epic modern-day myth of Lost to the (dare I call it) Beckettian dark comedy of Trailer Park Boys, the drawn out tales of our series (often consumed a ’season’ at a time: I know at least three people waiting for The Wire to finish before downloading it) are an undeniable core of our emerging P2P culture.

We are the most passionate viewers ever, talking and writing profusely about the media we love, analysing, promoting, hosting free screenings… And they need us as much as we need them — all of these shows, without exception, enjoy their primary life on the networks, through our blogs, comments, reviews, remixes and fan fiction. Lost in particular has learned that incorporating online feedback can make a great (if utterly Shaggy Dog) story.

Can we find a way to get the shows we want made without buying the goddamn DVD? I remember this guy talking really sensibly a couple years ago about how Joss Whedon could get to make another season of Firefly, and we got this project back up his musings. Why didn’t Whedon try it? Because someone else owned his ideas? Perhaps it could have worked otherwise, and maybe it could work for the future. If you’ve got ideas, throw them in the comments box below. And if you have time in between catching up on The Wire, read this by the venerable guru of Wired magazine, Kevin Kelly — I’m going to try to get him into the next installment of STEAL THIS FILM. See you around. I’ll be back in two weeks to pick up the pieces.

'DVD Jon' Frees Your Media with DoubleTwist
Erica Ogg

The man notorious for cracking the DVD code, and Apple's FairPlay DRM, is looking to make a legitimate business out of his expertise.

Beginning Tuesday, the first product from his company, DoubleTwist Ventures, will enter open beta. Called DoubleTwist, it's a free desktop client that essentially allows any kind of music, photo, or video file to be shared between a long list of portable media players, and through Web-based social networks.

Instead of iTunes songs or videos taken with a Nokia N95 remaining locked on the phone, DoubleTwist software allows for dragging, dropping, and syncing of different media formats no matter the device.

The idea, according to DoubleTwist founder and CEO Monique Farantzos, is that media files should be more like e-mail. It shouldn't matter what service you create the file in, or on what type of hardware, it all should work together seamlessly, she says.

Farantzos recruited DVD Jon, or Jon Lech Johansen, and the two have been working with about 10 others for the past eight months on the DoubleTwist software. Johansen says DoubleTwist allows him to bring the success he's found to a wider audience.

"It's one opportunity to write something for your Web site for use by a couple thousand geeks," he said in an interview. But with DoubleTwist, the idea is to hide all the complexity of making easy transfers of files from the user so that even non-techie types will understand. "The goal is to make something your parents can use," he said.

It works like this: When a device is plugged into a PC (Windows XP and Vista only right now, Mac OS X coming soon), DoubleTwist launches and recognizes all the media files on the device. Any file can be selected, dragged, and dropped into DoubleTwist to be synched up to a separate device, or shared with other users you've "friended" who also use DoubleTwist.

By adding Facebook compatibility (with OpenSocial platforms next on their list), DoubleTwist users can share media through the social network. A Facebook application called TwistMe will allow users to drag and drop media content into a box on a fellow user's Facebook profile. The friend will then see the shared files show up in his DoubleTwist desktop client.

Social-network compatibility is key to enable real sharing of media between users, Farantzos said. "It closes the loop between the Web, devices, and the desktop."

DoubleTwist also recognizes and imports all iTunes playlists and will read instantly which ones are protected by digital rights management technology. The software automatically plays the song files in the background (sans volume) and re-records them as MP3 files so they can be transferred to any device. Note: DoubleTwist only does this for songs you own or are authorized to play in iTunes.

Farantzos says they're not picking on any one particular brand of DRM, especially since the entire industry, led by Amazon, is leaning toward a DRM-free policy.

"Digital media is dominated by two players, Windows Media and iTunes, and they each have their own agenda...we see ourselves as the Switzerland of digital media. We are format and device agnostic."

Until next week,

- js.

Current Week In Review

Recent WiRs -

February 16th, February 9th, February 2nd, January 26th

Jack Spratts' Week In Review is published every Friday. Submit letters, articles, press releases, comments or questions in plain text English to jackspratts (at) lycos (dot) com. Submission deadlines are Thursdays @ 1400 UTC. Please include contact info. The right to publish all remarks is reserved.

"The First Amendment rests on the assumption that the widest possible dissemination of information from diverse and antagonistic sources is essential to the welfare of the public."
- Hugo Black
JackSpratts is offline   Reply With Quote

Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

vB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Forum Jump

Similar Threads
Thread Thread Starter Forum Replies Last Post
Peer-To-Peer News - The Week In Review - September 22nd, '07 JackSpratts Peer to Peer 3 22-09-07 06:41 PM
Peer-To-Peer News - The Week In Review - May 19th, '07 JackSpratts Peer to Peer 1 16-05-07 09:58 AM
Peer-To-Peer News - The Week In Review - December 9th, '06 JackSpratts Peer to Peer 5 09-12-06 03:01 PM
Peer-To-Peer News - The Week In Review - September 16th, '06 JackSpratts Peer to Peer 2 14-09-06 09:25 PM
Peer-To-Peer News - The Week In Review - July 22nd, '06 JackSpratts Peer to Peer 1 20-07-06 03:03 PM

All times are GMT -6. The time now is 08:29 PM.

Powered by vBulletin® Version 3.6.4
Copyright ©2000 - 2021, Jelsoft Enterprises Ltd.
© www.p2p-zone.com - Napsterites - 2000 - 2021