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Old 20-01-10, 09:04 AM   #1
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Default Peer-To-Peer News - The Week In Review - January 23rd, '10

Since 2002

"[ScanSafe's] latest numbers show a 55 percent increase in illegal MP3 and software download attempts over the last three months on the corporate networks it tracks." – Matthew Hines

"We have sent letters to the RIAA and the MPAA repeatedly letting them know that our downloads are a direct representation of their failure to allow us to be good consumers as others in the US can be." – U.S. Military source

"Skype is now the largest provider of cross border communications in the world, by far." – Stephan Beckert

"This is a stunner. I remember saying we've hit a ceiling on media use, since there just aren’t enough hours in the day to increase the time children spend on media. But now it's up an hour." – Donald F. Roberts

"The court's invalidation of campaign finance reforms over the last few decades isn't about censorship or suppressed speakers or viewpoints. At its core, this line of cases is about dominance of the political and electoral system by wealthy people and corporations and about legitimizing a political and electoral system that is unrepresentative, money-driven, corrupt, outmoded, and dysfunctional." – David Kairys

January 23rd, 2010

Does the Fourth Amendment Cover 'the Cloud'?
James Urquhart

One of the biggest issues facing individuals and corporations choosing to adopt public cloud computing (or any Internet service, for that matter) is the relative lack of clarity with respect to legal rights over data stored online. I've reported on this early legal landscape a couple of times, looking at decisions to relax expectations of privacy for e-mail stored online and the decision to allow the FBI to confiscate servers belonging to dozens of companies from a co-location facility whose owners were suspected of fraud.

However, while I've argued before that the government has yet to apply the right metaphor to the modern world of networked applications and data, there has been little literature that has actually dissected the problem in detail. Even worse, I've seen almost no analysis of how the United States Constitution's Fourth Amendment, which guards against unreasonable searches and seizures, applies to Internet-housed data.

However, I just had the pleasure of reading an extremely well-written note in the June 2009 edition of the Minnesota Law Review titled "Defogging the Cloud: Applying Fourth Amendment Principles to Evolving Privacy Expectations in Cloud Computing." Written by David A. Couillard, a student at the University of Minnesota Law School expected to graduate this year, the paper is a concise but thorough outline of where we stand with respect to the application of Fourth Amendment law to Internet computing. It finishes by introducing a highly logical framework for evaluating the application of the Fourth Amendment to cases involving cloud-based data.

According to Coulliard, we aren't very far along at all today:

Under a rubric of "reasonable expectations of privacy," the Court has since defined the contours of the Fourth Amendment's application in varying circumstances. But technology and society's expectations are evolving faster than the law. Although statutory schemes exist, some argue that these laws are outdated. Meanwhile, the Supreme Court has not even addressed the Fourth Amendment's application to e-mail, let alone the expanding uses of cloud-computing platforms. Thus, Fourth Amendment law needs a framework that will adapt more quickly in order to keep pace with evolving technology.

I stated essentially the same thing in my Cloud Computing Bill of Rights back in 2008:

In order for enough trust to be built into the online cloud economy, however, governments should endeavor to build a legal framework that respects corporate and individual privacy, and overall data security. While national security is important, governments must be careful not to create an atmosphere in which the customers and vendors of the cloud distrust their ability to securely conduct business within the jurisdiction, either directly or indirectly.

Coulliard starts his analysis with how legal precedent for telephonic communications may or may not apply to the cloud. He notes that all such law is evaluated under a "reasonable expectation of privacy" test:

The reasonable-expectation-of-privacy test arose out of Katz v. United States, where Justice Harlan, concurring, outlined a two-part requirement: (1) that the person demonstrated a subjective expectation of privacy over the object and (2) that the expectation was reasonable. This test can be applied to both tangible and intangible objects. However, when the object of a search--tangible or not--is voluntarily turned over to a third party, the Supreme Court has held that a person loses their reasonable expectation of privacy in that object.

Much of the legal confusion in cases involving any form of data or transaction on the Internet since has revolved around considering whether storing your data in a third-party data center is in fact subject to the so-called "third-party doctrine." This includes cases like Smith v. Maryland, in which the courts argued that people generally gave up an expectation of privacy with regard to their phone records simply through the act of dialing their phone--as the phone company receives and processes the phone numbers, thereby becoming a party in the transaction.

Coulliard argues, however, that while Smith v. Maryland applies to the phone numbers dialed, it does not apply to the contents of the conversation, as noted in Katz v. United States. Thus, the courts should adopt a framework in which the third-party doctrine is applied much more narrowly to online content (including cloud-based data), according to Coulliard.

Coulliard goes on to discuss legal analogies of virtual containers, encryption and password protection to briefcases, locks, and keys. The argument is complex, but it turns out that in the physical world, the combination of security and opacity of a container used to store an object both affect the "reasonable expectation of privacy" test:

Hypothetically, if a briefcase is locked with a combination lock, the government could attempt to guess the combination until the briefcase unlocked; but because the briefcase is opaque, there is still a reasonable expectation of privacy in the unlocked container. In the context of virtual containers in the cloud...encryption is not simply a virtual lock and key; it is virtual opacity.

So, if the courts were to interpret digital assets in the same way Coulliard does, you could virtually (no pun intended) assure your Fourth Amendment protections, even in the cloud, if you simply encrypted your data. Cloud vendors, are you listening?

Coulliard wraps up with a suggested framework for applying the Fourth Amendment to "the cloud" that is very much in line with my own thinking. Treat digital assets on third-party sites not as transactions (like phone numbers dialed), but in the same way you would treat physical assets kept in an apartment or storage locker:

[T]he service provider has a copy of the keys to a user's cloud "storage unit," much like a landlord or storage locker owner has keys to a tenant's space, a bank has the keys to a safe deposit box, and a postal carrier has the keys to a mailbox. Yet that does not give law enforcement the authority to use those third parties as a means to enter a private space.

The same rationale should apply to the cloud. In some circumstances, such as search engine queries, the third party is clearly an interested party to the communication. But when content data, passwords, or URLs are maintained by a service provider in a relationship more akin to that of landlord-tenant, such as private Google accounts, any such data that the provider is not directly interested in should not be understood to be open to search via consent or a waiver of Fourth Amendment protection.

Amen, Mr. Coulliard. Personally, I hope the courts note this framework, and begin applying it to Fourth Amendment cases arising from Internet-based computing immediately. Furthermore, I call for Congress to explicitly codify a similar framework with laws that clearly and unequivocally state the rights of users with respect to their data in the cloud.

Then again, given the track record of our state and federal legislative bodies with respect to technology law, maybe not...

Blogs, YouTube Prompt Campaign Finance Ruling
Declan McCullagh

The U.S. Supreme Court's sweeping ruling on Thursday that invalidated large chunks of campaign finance law arose in part from an unlikely source: the emergence of Facebook, YouTube, and blogs, and the decline of traditional media outlets.

A 5-4 majority concluded that technological changes have chipped away at the justification for a law that allows individuals to create a blog with opinions about a political candidate--but threatens the ACLU, the National Rifle Association, a labor union, or a corporation with felony charges if they do the same.

The now-invalidated law "would seem to ban a blog post expressly advocating the election or defeat of a candidate if that blog were created with corporate funds," Justice Anthony Kennedy wrote in the majority opinion. "The First Amendment does not permit Congress to make these categorical distinctions based on the corporate identity of the speaker and the content of the political speech."

Eugene Volokh, a law professor at UCLA, called it the "first appearance" of the word "blog" in a Supreme Court opinion. And Google's video-sharing site is singled out in the conclusion, with Kennedy writing that "skits on YouTube.com" that cast politicians in an unflattering light could give rise to "felony" charges if a corporation dared to post them.

Kennedy added: "Rapid changes in technology--and the creative dynamic inherent in the concept of free expression--counsel against upholding a law that restricts political speech in certain media or by certain speakers. Today, 30-second television ads may be the most effective way to convey a political message. Soon, however, it may be that Internet sources, such as blogs and social-networking Web sites, will provide citizens with significant information about political candidates and issues."

Federal law generally prohibits for-profit and nonprofit corporations and unions from paying to advocate the election of or defeat of a political candidate. The 2002 McCain-Feingold law expanded that prohibition to include so-called electioneering communications, defined as any "broadcast, cable, or satellite communication" that even "refers to" a candidate for federal office and is made within 30 days of a primary or 60 days of a general election.

Thursday's ruling invalidates many of those requirements, meaning that nonprofit and for-profit corporations and labor unions will be able to spend money on political films, advertisements, YouTube videos, and so on. But the decision comes with two important caveats: first, none of that money will be permitted to go directly to political candidates. Second, an 8-1 majority of the court upheld a disclosure requirement applying to those groups spending money on the political ads or other materials.

The court pointed out that the now-invalidated laws are more sweeping than the term "campaign finance" might imply--and amount to simple censorship. It listed these acts of political speech that previously would have been criminalized: the Sierra Club running an ad (close to the time of an election) disapproving of a congressman who favors logging in national forests; the NRA publishing a book urging a vote against an incumbent U.S. senator who supports a handgun ban; and the American Civil Liberties Union creating a Web site telling the public to vote for a presidential candidate because of that candidate's defense of free speech.

The case in front of the Supreme Court arose when Citizens United, a conservative nonprofit group, sought a legal opinion recognizing their right to air a documentary film sharply critical of then-presidential candidate Hillary Clinton. Citizens United worried that the film and ads for the film, to be shown on a video-on-demand service before the 2008 Democratic primaries, would subject them to civil and criminal penalties.

Election law's double standard?

The New York Times endorses political candidates (in 2008, it endorsed Barack Obama). So does the New York Post (it chose John McCain).

Those endorsements on the eve of a presidential election were permitted under U.S. election laws--even though both newspapers are owned by corporations with market capitalizations in the billions of dollars. But the tiny nonprofit called Citizens United, funded mostly by individual donations, was barred from sharing its own political views.

Joel Gora, a professor at Brooklyn Law School and ACLU lawyer who argued a landmark 1976 Supreme Court case, wrote at The New York Times' Web site today that the justices "dismantled the First Amendment 'caste system' in election speech. Before today, the right to speak depended on who was doing the speaking: business corporations, no, unless they were media corporations; nonprofit corporations, maybe, depending on where they got their funding; labor unions, no."

This legal equivalent of a caste system was assembled by legislators and judges during an era when the only national television broadcasters were the major networks, when only Hollywood produced documentaries, and when only large publishers owned printing presses.

Deciding who was a media company must have been easier then, and in fact a 1986 Supreme Court case yielded the verdict that a pro-life advocacy group's newspaper did not qualify for the press exemption.

But then blogs, digital cameras, and social-networking sites arrived. When anyone with an iPhone can edit and upload a video to YouTube within seconds, who qualifies as media? Does a daily radio show hosted by the NRA? How about a Web site run by Microsoft that includes essays from political types including an Obama campaign advisor on energy and environmental issues who was also a surrogate for Obama at public events and a member of Obama's transition team?

That's what led Justice Kennedy, writing for the majority, to say: "With the advent of the Internet and the decline of print and broadcast media...the line between the media and others who wish to comment on political and social issues becomes far more blurred."

The dissenting justices, on the other hand, downplayed the effect of the McCain-Feingold and other laws on the Internet. Justice John Paul Stevens (who may be retiring this year) wrote that the law "does not apply to printed material" so it's unreasonable to worry about a ban on "books, pamphlets, and blogs."

Stevens also wrote: "We highly doubt that (the law) could be interpreted to apply to a Web site or book that happens to be transmitted at some stage over airwaves or cable lines, or that the (Federal Election Commission) would ever try to do so." (In 2006, amidst warnings that this was the beginning of a new regulatory structure, the FEC adopted a generally liberal view of Internet politicking.)

While Thursday's ruling left supporters of stricter regulation of political speech outraged, their next steps are not obvious. President Obama said his administration will "talk with bipartisan congressional leaders to develop a forceful response to this decision," although any revised legislation could be struck down by the Supreme Court again. In a conference call with reporters, the Public Citizen and U.S. PIRG advocacy groups said they had started a petition drive and would even seek to amend the U.S. Constitution--marking the first time that the First Amendment would be explicitly altered.

Money Isn't Speech and Corporations Aren't People

The misguided theories behind the Supreme Court's ruling on campaign finance reform.
David Kairys

Go back almost a century, to the time when the modern corporation was created, and you'll find laws that prohibit or limit the use of corporate money in elections. And yet this week, a 5-4 Supreme Court struck down the limits that Congress passed in 2002 in this tradition in the case Citizens United v. FEC.

The majority's ruling unleashes a new wave of campaign cash and adds to the already considerable power of corporations. The court's main rationale is that limits on using corporate treasuries for campaigns are a "classic example of censorship," as Justice Anthony Kennedy wrote for the majority. To get there, Kennedy depends on two legal theories that blossomed as constitutional principles in the mid-1970s: money is speech and corporations are people. Both theories are strange, if not simply wrongheaded—why, according to the Constitution or common sense, would money be speech or corporations be people? The court has also employed theories not uniformly but, rather, as constitutional cover for dominance of the electoral system by corporations and by the wealthy.

The first theory appeared in a 1976 decision, Buckley v. Valeo, which invalidated some campaign-finance reforms that came out of Watergate. The Court concluded that most limits on campaign expenditures, and some limits on donations, are unconstitutional because money is itself speech and the "quantity of expression"—the amounts of money—can't be limited.

But in subsequent cases, the conservative justices who had emphatically embraced the money-is-speech principle didn't apply it to money solicited by speakers of ordinary means. For example, the court limited the First Amendment rights of Hare Krishna leafleters soliciting donations in airports to support their own leafleting. The leafleting drew no money-is-speech analysis. To the contrary, the conservative justices, led by Chief Justice Rehnquist, found that by asking for money for leafleting—their form of speech—the Hare Krishnas were being "disruptive" and posing an "inconvenience" to others. In other words, in the court's view, some people's money is speech; others' money is annoying. And the conservative justices have raised no objection to other limits on the quantity of speech, such as limits on the number of picketers.

The money-is-speech theory turns out to be a rhetorical device used exclusively to provide First Amendment protection for all money that wealthy people and businesses want to give to, or to spend, on campaigns. It also doesn't make sense under long established free-speech law. Spending or donating money to support or facilitate speech is expressive and deserves some protection. But money simply doesn't make it into the category of things that are and embody speech, such as books, films, or blogs. Traditional speech-law analysis would separate the speech from the conduct (or "nonspeech") elements of campaign spending and donation and allow considerable leeway to regulate the latter. Even as to "pure" speech, "compelling" government interests are overriding. And spending and donating money seem, among the traditional speech-law categories, a "manner" of speaking that the court has said usually can be "reasonably regulated."

The other basic theory supporting the ruling in Citizens United—the court's claim that, for some purposes, corporations are constitutionally, if not actually, people—comes out of the long history of the development of corporations. But the extension of corporate personhood to campaign speech is a controversial innovation of the conservative justices over the last few decades.

Corporations needed some rights usually reserved for people to function as legal entities, so that they could, for instance, make enforceable contracts and sue or be sued. But despite the common cultural personification of corporations—we can easily say "GM was embarrassed today"—they obviously don't and shouldn't have all the rights of people. For example, they don't have the right to vote.

In Citizens United, Justice Kennedy discusses business corporations as if they were clubs or political associations with political viewpoints and elected leaders. But corporate managers don't function as representatives or employees of shareholders, who have no say, no shared political views, and no expectation that their investments will be used for political ends. In the wake of the court's ruling this week, will some corporations pick a party or politics while others channel unheard of amounts of money to both major parties? Will investors be influenced by a corporation's political portfolio?

The Citizen's United decision will make it harder to achieve reforms opposed by major corporations and change business as well as politics. Increasing the constitutional rights of corporations beyond their business purposes is really about increasing the rights and power of corporate managers. Government has enabled corporate managers to control huge accumulations of wealth without any personal risk—an arrangement that contributes to wild, bubble-producing economic swings and collapses. Citizens United invites that arrangement directly into politics and elections.

Both of these theories—that money is speech and that corporations are people—have an easier time than they should in courts and with the public, too, because they are posed as counters to censorship. Many of us, including me, haven't seen a free-speech argument we don't like, at least initially.

But some perspective: We limit speech—when it has nothing to do with wealthy people spending money—in many ways. (It wasn't protected at all until the mid-1930s.) You famously can't shout fire in a theater. You not-so-famously can't break the theater's rules, including rules about speaking, because you don't really have any First Amendment rights in a privately owned theater or at work. The First Amendment limits only government. And even where it is fully protected, free speech has not been absolute; it's subject to regulation when it undermines basic societal interests and functions, like voting and democracy. In the last few decades, the conservative justices dominating the court have also limited speech rights for demonstrators, students, and whistle blowers. They have restricted speech at shopping malls and transit terminals. Taken as a whole, the conservative court's First Amendment jurisprudence has enlarged the speech rights available to wealthy people and corporations and restricted the speech rights available to people of ordinary means and to dissenters.

In a largely unnoticed rewriting of speech law, the conservative justices have applied their theories and doctrines inconsistently and selectively, as they have money-is-speech. Some of the conservatives' recent innovations would seem to validate campaign finance laws. The "secondary effects" doctrine, for example, allows government to restrict speech if government can suggest a general, non-speech-related purpose, even if the real purpose is speech-related. The court ignored this doctrine in Citizens' United and other campaign finance cases—even though campaign finance reform is aimed not at speech itself, but at large amounts of money that skew, corrupt, and undermine elections.

The court's invalidation of campaign finance reforms over the last few decades isn't about censorship or suppressed speakers or viewpoints. At its core, this line of cases is about dominance of the political and electoral system by wealthy people and corporations and about legitimizing a political and electoral system that is unrepresentative, money-driven, corrupt, outmoded, and dysfunctional. Wealthy people and corporate managers shouldn't dominate politics or have more and better speech rights than the rest of us. That seems like an obvious truth. And yet the Supreme Court's recent decisions move us away from it.

Internet Filter Protesters Set to Fade Websites to Black on Australia Day
Jennifer Dudley-Nicholson

AUSTRALIA Day won't just be celebrated with the usual barbecues, pool parties and the Triple J Hottest 100 this year.

A throng of Australian websites will mark the event by fading to black as part of a week-long, national protest against the Federal Government's proposed internet filter.

More than 150 website owners have joined The Great Australian Internet Blackout so far, and organiser Jeff Waugh predicts many more will sign up during the week of national action.

The January 25-29 protest is based on a similar campaign in New Zealand last year to protest mandatory internet disconnections for those accused of copyright theft.

'Quite frustrated'

Mr Waugh says that action resulted in the laws being removed from the New Zealand parliament, and he hopes for a similarly meaningful result in Australia.

He says the Australia Day protest is designed to attract national attention after the Government quietly released a report about the filter on December 15.

"The internet filtering report had been completed and was ready to publish in October but it wasn't made public until just before Christmas," he says.

"I was quite frustrated by that because I knew the news wouldn't go very far, but then I realised that Australia Day was coming and we had a really great opportunity to raise awareness about it."

The campaign's website (internetblackout.com.au) features instructions and a script to turn websites black for the duration of the protest, but the dark covering won't prevent Australians from seeing participating websites: it can be removed with just one click.

Mr Waugh says the campaign is designed to educate web users about the proposed internet filter. Those without websites can turn their Facebook or Twitter profile photo black for the week or hand out educational leaflets on Australia Day.

"We just want to get the message out there about what all of this means, beyond the tech-savvy folk who already know about it, to the general public," he says.

"This filter will be ineffective and expensive but what has been proposed won't actually protect children online."

About the filter

The Federal Government's proposed internet filter would force internet service providers to block access to a website blacklist created by the Australian Communications and Media Authority (ACMA).

The mandatory filter would ban any website deemed to feature Refused Classification (RC) content and would result in ACMA investigating and classifying sites based on public complaints.

Communications Minister Senator Stephen Conroy claims the mandatory filter will reduce "the risk of Australians being inadvertently exposed to RC-rated material when they are online".

But several internet and technology firms have criticised the proposal, including Google Australia.

The company's policy head Iarla Flynn says Google is concerned that the "the scope of content to be filtered is too wide" and that "socially and politically controversial material" could be banned from Australian eyes as part of the scheme.

The Great Australian Internet Blackout is being held in collaboration with the Electronic Frontiers Association (EFA), which is behind Australia's No Clean Feed website.

EFA board member Colin Jacobs says he hopes the protest will educate internet users about the filter that he says could "give parents a false sense of security" and open the door for politically sensitive material, such as euthanasia websites, to be blocked.

Lobby group GetUp! has also run ongoing campaigns against the internet filter, including its Censordyne commercial, which drew media attention. The group's website encourages people to protest the filter by contacting Sen. Conroy directly.

Turkey Blocking 3,700 Websites: OSCE

Europe's main security and human rights watchdog said Monday Turkey was blocking some 3,700 Internet sites for "arbitrary and political reasons" and urged legal reforms to show its commitment to freedom of expression.

Milos Haraszti, media freedom monitor for the 56-nation Organization for Security and Cooperation in Europe (OSCE), said Turkey's Internet law was failing to preserve free expression in the country and should be reformed or abolished.

"In its current form, Law 5651, commonly known as the Internet Law of Turkey, not only limits freedom of expression, but severely restricts citizens' right to access information," Haraszti said in a statement.

He said Turkey, a European Union candidate, was barring access to 3,700 Internet sites, including YouTube, GeoCities and some Google pages, because Ankara's Internet law was too broad and subject to political interests.

"Even as some of the content that is deemed 'bad', such as child pornography, must be sanctioned, the law is unfit to achieve this. Instead, by blocking access to entire websites from Turkey, it paralyzes access to numerous modern file-sharing or social networks," Haraszti said.

"Some of the official reasons to block the Internet are arbitrary and political, and therefore incompatible with OSCE's freedom of expression commitments," he said.

Haraszti said Turkish law was still failing to safeguard freedom of expression, and numerous criminal code clauses were being used against journalists, who risked being sent to jail as a result.

"Therefore 'reform or abolish' the Internet Law is our main recommendation ... (to ensure Turks can be) a part of today's global information society."

Fears for press freedom in Turkey have risen as a result of state attempts to collect a $3.3 billion fine from major media group Dogan in a tax row, part of pressure on Dogan to obey a law limiting foreign ownership of Turkish firms.

In October, the European Commission's annual report on Turkey's progress toward EU membership urged Turkey to treat Dogan fairly and said Ankara needed to do more to protect freedom of expression and the press.

(Writing by Mark Heinrich; editing by Tim Pearce)

China Region Cut from Internet for 6 Months so Far
Cara Anna

They arrive at this gritty desert crossroads weary from a 13-hour train ride but determined. The promised land lies just across the railway station plaza: a large, white sign that says "Easy Connection Internet Cafe."

The visitors are Internet refugees from China's western Xinjiang region, whose 20 million people been without links to the outside world since the government blocked virtually all online access, text messages and international phone calls after ethnic riots in July. It's the largest and longest such blackout in the world, observers say.

Every weekend, dozens of people pile off the train in Liuyuan, a sandswept town on the ancient Silk Road that's the first train stop outside Xinjiang, 400 miles (650 kilometers) east of Urumqi, the regional capital.

"We must get online! We must!" said Zhao Yan, a petite, ponytailed businesswoman from Xinjiang's capital, Urumqi. She has rented the same private booth in the Internet cafe every weekend since August in an uphill battle to keep her small trading business going.

"If this goes on another couple of months, I'll have to give up," Zhao said. "I can't keep up with the outside world, and I'm losing money."

Xinjiang residents are without Internet links unless they flee to farflung places like Liuyuan. One customer had traveled 750 miles (1,200 kilometers) just to get online.

Authorities unplugged Xinjiang, a sprawling area three times the size of Texas, in an attempt to prevent a repeat of the ethnic rioting between the Han Chinese majority and the mainly Muslim Uighur minority that the government says left almost 200 dead. China's government blamed overseas activists for the riots, saying they stirred up resentment in the Uighur community through Web sites and e-mails.

For many, it feels like being thrown back in time 30 years.

Xinjiang now has no e-mail. No blogs. No instant messaging. The government this month promised Internet access would resume "gradually," but it also said the same thing in July and not much has changed. So far, only four restricted Web sites, half of them state-run media, have returned.

No country has shut down an information infrastructure so widely for so long, said the Open Net Initiative, a Harvard-linked partnership that monitors Internet restrictions around the world. Some former Soviet Union countries have done it during sensitive elections, but "the blackout only lasted for hours or days at most," said Rafal Rohozinski, the group's principal investigator.

The normal Internet in China is already among the world's most restricted.

"The fact that the Chinese authorities had to resort to shutting down and cutting off the entire infrastructure ... is indicative of the difficulty they are having in controlling cyberspace," Rohozinski said.

"You can look at news or movies. That's it. It's all one-way," said a 23-year-old from Urumqi, who sat a few screens away from Zhao and was clicking between an e-mail account and a Russian-language Web site. He'd been online for 11 hours. He didn't give his name because he's half Uighur and was worried about retribution from authorities.

Liuyuan has little more to offer the Xinjiang refugees besides its Internet connection and its steady supply of cross-country trains. "You don't want to stay here," said the desk clerk at the Liutie Hotel, the only guesthouse in town. Most people who get off the train are headed for the famous oasis of Dunhuang, two hours to the south.

On Sunday, most of the Xinjiang customers bolted back home after hearing word that mobile phone text-messaging services had finally resumed. The region's mobile phone users sent 42.84 million text messages the first day of service alone, the state-run Xinhua News Agency reported.

Users are still limited to no more than 20 texts per day, with no international service. International calls from Xinjiang remain also blocked. Residents can call overseas only from a China Telecom office, where they first have to show their ID. In some places, people wait in line for more than an hour.

"It's like it's back to the '70s, when we just had radios and a loudspeaker. We just heard whatever (the government) said and we had no choice," said Liu Jun, a Hong Kong resident who grew up in Xinjiang. Since her hometown can't receive overseas calls, she now must cross the border to the mainland just to telephone her parents.

One Xinjiang woman who wanted to chat with her American husband finally took an overnight bus to neighboring Kazakhstan to get online.

"It's like a social experiment — what would happen if we take away the Internet?" said the husband, Kevin Komoroka, who lives in Missouri. He said their work on her U.S. visa application has slowed to a crawl and now relies on air mail. "No one at any sort of level knows when it will end."

An international scientific conference was relocated outside the region. A board member of an international academic association travels regularly to Beijing, 1,800 miles from Urumqi, to check her e-mail. The Federal Express office in Urumqi tells customers to check orders by phone instead.

The Xinjiang government has said foreign investment and tourism were "seriously" affected last year, though it points to the July violence alone. Import-export business fell 38.8 percent in the first nine months of last year, dropping almost 18 percentage points more than the rest of China, it said in a report this month.

"We're like deaf people now," said Wei Chengzhi, who works in the online service office of Xinjiang Wind Energy Co. Ltd. "We're working on a joint project with a partner company in Shanghai. We can't communicate with them. Nor can we do any online research."

Xinjiang's commerce department says it now offers Internet access to companies that can get approval from the local foreign trade or foreign investment office, but only on weekdays.

One business owner couldn't wait. Just after the riots, Ma Hui and her husband took off on a three-day road trip east to Beijing to keep their dried fruit company going. Since then, her husband has lived in the capital to deal with online orders, while Ma lives in Urumqi and handles the product.

"We've been married three years and we've never lived apart before," she said. "We don't know when to expect the Internet to come back to normal."

One person who doesn't mind the blackout is the owner of Liuyuan's Easy Connection Internet Cafe, who wouldn't give his name but said he was quite happy with the increased business.

As night fell in Liuyuan, Zhao sighed and returned to her work online. She had three more hours before taking the overnight train home to Urumqi, but she expected to be back and online Saturday morning.

It's easy to recognize her fellow refugees by their computer bags, Zhao said.

"You should go to Jiuquan," the next major stop east along the railway, she said. "It's a bigger city, and even more people go there. They check into the hotels and use the broadband."

A faster connection — another 200 miles (320 kilometers) away.

U.S. has Met with China on Internet Freedom

The United States has had multiple meetings with Chinese authorities over Internet freedom and will have more in the coming days, a top State Department official said on Tuesday amid continuing tensions between Google and Beijing.

Assistant U.S. Secretary of State Kurt Campbell told reporters that Washington viewed free and open Internet use as a "universal right that should be available to all people."

"The ability to operate with confidence in cyberspace is critical in a modern society and economy," he said.

"The U.S. government has had multiple meetings with Chinese authorities on this matter and will have more in the coming days," Campbell added.

Google said last week that it and other companies were targets of sophisticated cyber-spying from China, and threatened to pull out of the country.

"We take this matter very seriously," Campbell said. "The whole issue does raise serious concerns."

He said China had denied the allegations made by Google. Campbell said Washington believed Chinese authorities were in the best position to explain the situation, "and we are asking them for an explanation."

(Reporting by Andrew Quinn and Arshad Mohammed; Editing by Eric Beech)

Aid Urged for Groups Fighting Internet Censors
Brad Stone

Five United States senators are publicly urging Secretary of State Hillary Rodham Clinton to move faster to support organizations that are helping people in countries like Iran and China circumvent restrictions on Internet use.

In a letter written by Senator Sam Brownback, Republican of Kansas, and made public on Wednesday, the senators ask Mrs. Clinton to quickly spend $45 million in funds that have been earmarked over the last two years to support Internet freedom, but have not yet been spent.

The senators also complain that restrictions on who can apply for the money, recently outlined by the State Department, appear to exclude the organizations that are creating the most popular tools for getting around censorship.

The letter was drafted before Google accused China last week of attacking its computers and said it was no longer willing to censor its search results there. But it picked up more supporters since then.

Efforts to give financial support to groups creating such software recall anticommunist programs during the Cold War, when the United States government backed broadcasters like Radio Free Europe, which provided news and information to countries where a free press was banned.

But in the online age the nature of censorship has changed, and regimes like those in China and Iran often deny their populations access to Web news outlets and sites like Google, Facebook and Twitter. Political activists and others are also subject to having their online activities scrutinized.

Programs like Psiphon, Freegate and Tor, available free online, allow people in those countries to bounce their Internet traffic off of servers in other parts of the world, bypassing local restrictions. But the organizations that have developed those programs say they are constrained by resources and consumed by a never-ending technological arms race with government censors.

Some critics are also asking whether the United States government is wary of backing Internet freedom organizations with ties to Falun Gong, a spiritual movement that is suppressed in China, for fear of antagonizing the Chinese government.

“Officials at the State Department have sacrificed the interests of the demonstrators on the streets of Tehran, the interests of Google, and the principle of Internet freedom in closed societies on the altar of not making China go ballistic,”

,” said Mike Horowitz, a fellow at the Hudson Institute, a conservative research organization. The institute is advising the Global Internet Freedom Consortium, a group affiliated with Falun Gong that makes popular tools like Freegate.

In December, the State Department asked for funding proposals from organizations with technologies that “maximize free expression and the free flow of information and increase access to the Internet.”

The senators, in their letter, say that the State Department’s guidelines require organizations to demonstrate a presence in countries with repressive regimes, which would appear to rule out groups like the consortium that operate mainly in the United States.

In an interview, Michael Posner, the State Department’s assistant secretary for democracy, human rights and labor, said every organization would be considered “on the strength of whether they have a tool that will help advance the effort.” He said the State Department aims to operate like Silicon Valley venture capitalists, funding as many disparate efforts as possible in order to gain advantage over repressive regimes.

“The ways in which the technology is evolving means that it is increasingly difficult and inevitably impossible for governments to clamp down on that, unless they want to become North Korea,” Mr. Posner said. “Our job is to hasten the day when these controls break down and people can communicate freely.”

But the people creating such tools are expressing frustration with their inability to meet increasing global demand for their services, and with their lack of success, so far, in attracting support from the United States government.

“I think we just don’t get it, it’s politics,” said David Tian, a NASA engineer and Falun Gong practitioner who works on the Global Internet Freedom Consortium in his free time. “We really don’t understand how these things work inside the U.S. government.”

US Blocking Costa Rican Sugar From US Markets Unless It Agrees To Draconian IP Laws Citizens Don't Want
Mike Masnick

We were just talking about whether or not countries are really able to push back on the US's attempts to export draconian anti-competition/anti-innovation copyright and patent policies elsewhere. Michael Geist points us to two cases where US trade representatives are going overboard in trying to get foreign countries to put in place stringent intellectual property rules. The first is in Costa Rica, which is included in the Central America Free Trade Agreement (CAFTA). Yet like with other free trade agreements that the US has agreed to elsewhere, this one includes draconian intellectual property law requirements. I still cannot understand why intellectual monopoly protectionism -- the exact opposite of "free trade" -- gets included in free trade agreements. At least in Costa Rica, a lot of people started protesting these rules, pointing out that it would be harmful for the economy, for education and for healthcare. So the Costa Rican government has not moved forward with such laws. How has the US responded? It's blocking access to the US market of Costa Rican sugar until Costa Rica approves new copyright laws. Nice of the US, right? Bankrupting Costa Rican farmers to force Costa Rica to put in place a copyright regime it does not want.

Then there's the Bahamas, where US trade representatives are demanding new intellectual property laws, claiming that the country is not in agreement with WTO treaties. Apparently, the USTR is particularly upset about the police force in the Bahamas not cracking down on the sale of unauthorized DVDs, CDs and counterfeit clothing. However, as the Bahamas Chamber of Commerce president notes, nearly all of those counterfeit products actually originated in the US -- and that the majority of people doing the buying are US tourists. In other words, the issue is really with the US, but it seems to want everyone else to deal with it.

Dominican Hams Attempt to Install Repeaters in Haiti

Eight members of the Radio Club Dominicano (RCD) -- the Dominican Republic's IARU Member-Society -- and Union Dominicana de Radio Aficionados (UDRA) arrived in Haiti on Friday, January 15, to install an emergency radio communications station and a mobile station. Shortly after they arrived, the hams returned to the Dominican Republic for safety reasons.

The team -- using the call sign HI8RCD/HH -- had to shut down their operations after their convoy was fired on. Germinal Garcia, EB9GF, who is integrated in the Spanish Red Cross contingent, was able to contact colleagues at the RCD. According to IARU Region 1 Emergency Communications Coordinator Greg Mossop, G0DUB, the RCD initially reported that their team crossed the Haitian border at 1550 UTC, time arriving at the Dominican Embassy in Haiti at 1929 UTC when they started installing and testing their equipment.

"Within a few hours though, reports via the RCD Facebook page -- confirmed by a long telephone conversation between Hugo Ramón, HI8VRS, and Ramon Santoyo, XE1KK -- reported that the HI8RCD team of eight amateurs were back in the [Dominican Republic] border town of Jimani," Mossop said. "Their convoy, which included other non related Dominicans, was assaulted and one person is reported dead. The radio amateurs are uninjured, but they decided to leave the capital for safety [reasons] and return to the border unescorted. They report the situation as 'extremely unsafe.'"

On Saturday afternoon at 2104 UTC, Rafael Martinez, HI8ROX, posted this to the RCD's Facebook page: "I regret to inform you that the communications equipment is returning to Jimani due to the lack of security that there is in Haiti. The convoy was attacked as the team was leaving the embassy, with several wounded people confirmed. I do not know how many. For the moment, our equipment is safe, but I'm not sure." Martinez is the RCD's Web master.

On January 19, Martinez told the ARRL that two non-ham members of the team suffered "bad injuries," but no one had been killed, as had been reported earlier: "The gentleman who was behind the RCD convoy was very severely wounded (not deceased), although the first news was that he had passed away. The gentleman only is very severely wounded along with another person."

The team was able to install two VHF repeaters in the Dominican Republic linking that country's capital -- Santo Domingo -- and Port-au-Prince, but only one is in operation: 146.880 (-600), CTCSS 100 Hz. Mossop said that these repeaters are being used by the Red Cross and Civil Defense "since there is no other way to communicate. The station at the embassy in Haiti could not be activated. To confirm, all members of the RCD team are safe and have returned to Jimani in the Dominican Republic."

On the morning of Monday, January 18, Martinez wrote that "the equipment that was returned to Santo Domingo is all being sent to Jimani and then sporadically to Port-au-Prince."

Dept of Justice Files Brief Opposing Motion to set Aside Verdict in Tenenbaum

In SONY BMG Music Entertainment v. Tenenbaum, the Department of Justice has filed a brief opposing defendant's motion to set aside the verdict on constitutional grounds.

Department of Justice opposition brief

[Ed. Note. Another low-class "ostrich" brief from the Department of Justice, which completely ignores (a) the wording and reasoning of the Supreme Court in Gore and Campbell, (b) the half dozen or so cases, and three law review articles, concluding that Gore and Campbell are applicable to statutory damages cases, (c) the absence of evidence of any "distribution" within the meaning of the Copyright Act, and (d) the actual holding, the actual facts, and the actual statute, in St. Louis v. Williams. I.e., the things we mentioned in the revised amicus curiae brief which we filed on behalf of the Free Software Foundation.

Completely unprofessional; indeed pathetic.

Fortunately, Judge Gertner is an eminent Constitutional Law scholar, and has demonstrated time and again that she is anything but lazy, and that even when the lawyers in the case do a lousy job, she and her staff will actually do the research and find the applicable law.

I haven't always agreed with her decisions, and the major body of her work in the consolidated RIAA cases has been very helpful to the RIAA, but she has demonstrated time and again that she is the best lawyer in this case. -R.B.]

Court Reduces ‘Shocking’ File Sharing Award
David Kravets

A federal judge on Friday reduced a $1.92 million file sharing verdict to $54,000 after concluding the award for infringing 24 songs was “shocking.”

A federal jury in June found Jammie Thomas-Rasset liable in what at the time was the nation’s only Recording Industry Association of America file sharing case against an individual to go to trial. The Minnesota federal jury dinged her $1.92 million for infringing 24 songs. She asked the judge to set aside or reduce that $80,000 per song in damages.

U.S. District Judge Michael Davis agreed on Friday, and said the RIAA may have a retrial if it does not accept his ruling.

“The need for deterrence cannot justify a $2 million verdict for stealing and illegally distributing 24 songs for the sole purpose of obtaining free music,” Davis wrote. “Moreover, although plaintiffs were not required to prove their actual damages, statutory damages must bear some relation to actual damages.”

The decision came days after the Obama administration supported $675,000 in damages a jury levied against a Boston file sharer in the nation’s second and only other file sharing case against an individual to go to trial. Among other things, the administration said the large July award would “deter the millions of users of new media from infringing copyrights in an environment where many violators believe they will go unnoticed.”

Davis added that $1.92 million in damages “for stealing 24 songs for personal use is simply shocking.”

The new damages amount to three times the minimum of $750 damages the Copyright Act allows. The maximum is $150,000 per infringement, at a judge or jury’s discretion.

Thomas-Rasset, now 32, said she doesn’t have the money to pay even that reduced judgment, and that her house in Brainerd, Minnesota is homesteaded and protected from a judgment. The mother of four said she is a “very low- to middle-income” earner who works for a local Native American tribe.

“It’s not like I have a money tree in the backyard,” she said during a brief telephone interview.

The RIAA said it was reviewing the decision and was not prepared to comment.

Here’s Thomas-Rasset’s original $1.92 million playlist.

The decision, if it survives, may not have much weight in the file sharing world.

More than a year ago, the record labels announced they were winding down their nearly 6-year-old litigation campaign against individuals and instead were lobbying internet service providers to adopt a program to disconnect music file sharers.

One case in Boston still on the books concerns Joel Tenenbaum, the nation’s only other individual to go to trial against the RIAA. Most of the 30,000 cases the RIAA brought against individuals were settled out of court for a few thousand dollars.

Among other things, he is urging the federal judge in his case to reduce the $675,000 July jury verdict to $22,500, the minimum of $750 for 30 tracks.

U.S. District Judge Nancy Gertner, who is presiding over Tenenbaum’s case, is not obligated to follow Judge Davis’ decision

US Military BitTorrent Users Targeted By MPAA/RIAA

Being posted overseas in the military without the companionship of friends or family is hard enough, but being separated from entertainment makes things even harder. After letters written to the RIAA, MPAA and media outlets fell on deaf ears, an insider at a US base has revealed that a campaign is underway to download as much as possible.

Campaigns about copyright infringement, particularly those relating to online file-sharing mechanisms such as BitTorrent, are nothing new. They have, however, escalated in recent years and now regularly appear in the mainstream press, even penetrating our schools.

An insider at a US base in Japan has been in touch with TorrentFreak to tell us of a new initiative underway which is being operated by the Department of Defense. The campaign is running in overseas bases and is targeting members of the military currently using BitTorrent and other P2P software to obtain media.

While millions of regular US citizens also use file-sharing to acquire tv shows, movies and music, we’re told that military personnel overseas have a unique problem – their physical location excludes them from obtaining media from US-based services.

“For years many of us have spent time and money, hand over fist, looking for ways to work around IP blocks placed by companies operating from the states to access services such as NetFlix, Amazon, and others, to enjoy the same level of access as anyone living in the US does,” the insider told TorrentFreak.

“We have offered money to the companies in exchange for lifting the blocks and have offered up information as to how to allow military members into their content while strictly enforcing the contract,” he added.

However, the pleas to the various media companies appear to have fallen on deaf ears. Our contact believes that the content providers must have no interest in the business available from overseas military personnel, as they continue to block them from accessing content legitimately.

In a response to this inaction, we’re told that US military personnel have stepped up their campaign to download as much content as they can using BitTorrent.

“We have sent letters to the RIAA and the MPAA repeatedly letting them know that our downloads are a direct representation of their failure to allow us to be good consumers as others in the US can be,” our military insider explained.

Of course, the response from these groups has been predictable. On a daily basis, the MPAA and RIAA send copyright notices to military personnel via their base ISPs. In turn, the personnel are threatened with account suspension and in serious cases, disconnection.

“Sucks, but all of us have kept doing it [file-sharing] as we have made every reasonable attempt to gain access to the content legally as any person living on US sovereign ground can,” says our clearly frustrated contact.

While there is an apparent crackdown on online file-sharing, there is an interesting footnote to this story. TorrentFreak is informed that when personnel are deployed, they have access to sanctioned “Morale” hard drives which are allegedly filled with copyright materials acquired by “nefarious” means, and available for anyone to download and keep.

More Users Back on Illegal Programs
Matthew Hines

After several years of downward trending in the attempted use of illegal programs such as file sharing clients -- which have long been a breeding ground for all manner of attacks based on their underground status -- security researchers are noting a recent uptick in attempted of the applications.

Perhaps driven by the lagging worldwide economy, and certainly empowered by the continued proliferation of such programs, research shows that organizations are being put at greater risk based on people's use of illegal software, reports cloud-based filtering specialists ScanSafe, which was recently acquired by networking giant Cisco.

According to the company, its latest numbers show a 55 percent increase in illegal MP3 and software download attempts over the last three months on the corporate networks it tracks.

In addition to the added risk of malware attacks and other dangers introduced by the use of illegal software within organizations, there is also the issue of potential fines introduced by prosecution of file-sharing users. ScanSafe points to the recent conviction of U.S. student Joel Tenenbaum who was fined $675,000 for illegally downloading only 30 songs. In some cases the organizations who own networks being used for illegal file sharing could be held similarly responsible, the experts contend.

As illegal file-sharing and other greyware schemes have faded from the news spotlight over the last few years, workers have fallen back into dangerous usage patterns, the experts maintain.

"Employees mistakenly assume they can use the Internet at work in exactly the same way as they use it at home and this is potentially one of the reasons for this steady increase in illegal download attempts over recent months," Spencer Parker, director of product management at ScanSafe said in a research note. "Downloading illegal content is a 'double whammy' for employers as not only does it put them at risk legally but it also puts the company network at risk of being infected with malware."

A "large majority" of free illegal downloading websites are often "riddled with malware," he said.

To help discourage use of the systems, organization must not only put in place policies with established consequences and penalties for employees for using them, but also go to steps to block the unwanted content from reaching their systems altogether, ScanSafe recommends.

I guess it's time to go back to copying other people's CDs. Just kidding. Sort of.

Pirate Bay's VPN Goes Public: Ipredator
Cory Doctorow

As governments around the world consider proposals to hand surveillance powers to the entertainment industry and twitchy cops, the Pirate Bay is striking back. Its new €5/month IPRedator service is an encrypted VPN that you can use to hide your traffic (whatever it may contain) from prying eyes. The name comes from Sweden's adoption of IPRED (the "IP Rights Enforcement Directive," a punishing piece of anti-Internet legislation). I've been looking for a reliable VPN to use on public hotspots -- this might just be it.

Ipredator is currently using the same platform as several other VPN franchises including Relakks, which means it's not really anything we haven't seen before. The servers are maintained and provided by Pirate Bay affiliates though, which may be more trustworthy to the average BitTorrent user than a random VPN provider.

That aside, we were told by former Pirate Bay spokesman Peter Sunde that contrary to what the legal page states, no logs of any kind are kept by Ipredator. The text that is in there is a left over from the standard template they got from the provider of the VPN platform.

And, according to Sunde, there will soon be even more advantages and added security to Ipredator.
In fact, I just signed up. I'll let you know how it works out.

Acquittal in Oink Music Piracy Trial 'Deep Disappointment' to IFPI Group

Music industry vows to continue pursuing Middlesbrough man acquitted of piracy in case compared to Sweden's Pirate Bay

Music industry group IFPI has vowed to continue to pursue the man last week acquitted of conspiracy to defraud in a case compared to Sweden's high-profile Pirate Bay trial.

Alan Ellis, 26, was accused of making hundreds of thousands of pounds from the Oink website, which he operated from his flat in Middlesbrough.

Before it was shut down in a police raid in 2007, the website had more than 200,000 members who had downloaded more than 21m music files.

The verdict last week at Teesside Crown Court ended the music industry's hopes that it would be able to deter British music pirates with a homegrown equivalent of last year's case against Pirate Bay in Sweden.

IFPI head John Kennedy today said the outcome was a "terrible disappointment" that showed "the law is so out of touch with where life is these days".

"We will find other ways of going about it," he added.

The IFPI is considering a civil action, and may ask the Musicians Benevolent Fund, a charity, to write to Ellis requesting that he hand over money he allegedly made from Oink.

"I cannot sleep at night when that man has £200,000 sitting in his bank account," said Kennedy.

Last April, a Swedish court found the four men behind the Pirate Bay website guilty of breaking copyright law and handed down jail terms and a $4.5m (£3m) fine.

Neither Pirate Bay nor Oink hosted unlawfully copied material; both merely made it easy for active members to find other people on the web prepared to share files.

Unlike Pirate Bay, which was open to all, Oink was invite-only, with users earning the right to ask their friends to join.

According to reports from the seven-day trial, the court was told that users had to pay a donation to be able to ask friends to join. The court heard that these donations amounted to $18,000 (£11,000) a month for Ellis.

Some users of the site later disputed this. One, contacting the Guardian through Twitter, said that while it was possible to make donations to Oink, invitation rights were granted for contributing material to the site, not for donations.

A jury at Teesside Crown Court unanimously cleared Ellis, who maintained that he created the website to help him hone the computing skills he was learning as a student at Teesside University. He created it from a free template on the web and it was a hobby.

The prosecution said he told police officers: "All I do is really like Google, to really provide a connection between people. None of the music is on my website."

Indecency Fight Back In Appeals Court

The battle over the FCC's indecency policy continued on Wednesday as attorneys for Fox Television went into a Federal appeals court in New York to argue over so-called fleeting expletives. The case stems from the FCC clampdown on unscripted profanity after Cher and Nicole Richie each uttered curse words on a live telecast of the Billboard Music Awards in 2002 and 2003, respectively. Last spring, the Supreme Court sided with the FCC in the case and overturned a lower court ruling, but that was on procedural grounds. Now it has ordered the Second Circuit Court of Appeals in New York to reconsider the case on constitutional grounds.

In court, Fox attorneys argued that the government's practices stifle free speech and violate the First Amendment. The three judges reportedly kept a government lawyer on the defensive with dozens of questions that suggested that they might agree that the FCC's current policy violates the First Amendment, according to Variety. Attorney Jacob Lewis, representing the FCC, said that its policy was designed to protect children, and that the broadcast networks' voluntary ratings system was ineffective. The judges then reserved decision. If the appeals court rules in the networks' favor, the FCC will have to consider the significant possibility of losing should it take the case back to the high court, Variety reports.

Fox's case has the support of other broadcast networks, which have all experienced harsher government enforcement and heavier fines for indecent content. Next month, CBS will challenge the $550,000 in fines its affiliate stations received after the infamous Janet Jackson "nipplegate" incident at the Super Bowl in 2004. That case, however, involves a fleeting visual rather than a fleeting expletive, which is a distinction that the Third Circuit Court of Appeals in Philadelphia is expected to consider.

Brain Drain; Admin Failures Threaten FCC Role

GAO report critical of FCC decision-making process
Layer 8

The Federal Communications Commission has brain drain and administration problems that could decrease its effectiveness at a time when advanced service technologies such as wireless and broadband present significant regulatory challenges.

On the brain drain front, a report out today from watchdogs at the Government Accountability Office stated that from fiscal year 2003 to 2008, the number of engineers at FCC decreased by 10%, from 310 to 280. Similarly, from fiscal year 2003 to 2008, the overall number of economists decreased by 14%, from 63 to 54. While the number of engineers and economists has decreased from 2003 to 2008, the percentage of the workforce comprised of engineers and economists remained the same. In addition, the FCC estimates that 45 % of supervisory engineers will be eligible for retirement by 2011.

According to the GAO, the FCC has started hiring a larger number of engineers to replace retiring engineers and augment its engineering staff, most hires have been at the entry level. Of the 53 engineers hired in fiscal years 2007 and 2008, 43 were entry-level hires. During this same period, 30 engineers retired. Experts said recent graduates sometimes have little experience or understanding of how policies affect industry.

The need to grow experienced staff would help improve FCC's understanding of industry issues and could lead to better policies, according to the GAO report.

For economists, FCC faces an even higher share of staff eligible for retirement by 2011. FCC reports that, as of April 2009, 67 % of supervisory economists will be eligible to retire. The FCC may face challenges in addressing these impending retirements because 56% of nonsupervisory economists are also eligible to retire, and FCC has not hired any economists in fiscal years 2007 and 2008, the GAO stated.

According to the GAO: "The overall decline in the number of key occupational staff occurred during a period of increased need for technical, economic, and business expertise. New technologies, such as rapid growth in handheld and wireless devices, are challenging existing regulatory structures. FCC also cited a number of economic issues that impact the expertise and workforce required, such as marketplace consolidation and the need to craft economic incentives for incumbent spectrum users to relocate to other spectrum."

The GAO notes that the FCC has tried to bolster its workforce. It has added hiring and staff development programs designed to recruit new staff and develop the skills of its existing staff. While these programs are positive steps that can help attract, retain, and train new staff, it is not clear that these efforts are sufficient to address expertise gaps caused by retirements, the GAO noted.

The FCC added that it can shift staff from one bureau to another as needs arise and the regulatory environment changes. For example, as the need for tariff regulation decreased, FCC shifted staff from that area into other areas, the GAO stated.

While brain drain is a big concern, the GAO said there were other administrative items that need to be addressed. From the GAO report:

• The FCC's lack of written procedures for aiding the flow of information within the agency has in some cases led to ineffective interbureau coordination and allowed prior chairmen to limit internal communication among staff.
• It is unclear whether the roles of the Office of Engineering and Technology and the Office of Strategic Planning and Policy Analysis-two offices established to provide independent expertise on complex, crosscutting issues-are clearly defined or are overly subject to a chairman's preferences. Without written coordination procedures or clearly defined roles and responsibilities, FCC may be limited in its ability to address crosscutting issues.
• At the commission level, the lack of statutory requirements or internal policies on commissioners' rights and responsibilities during the decision-making process, including their right to bureau and office analysis, has let some chairmen control how and when commissioners receive information from the bureaus and offices. Other independent regulatory agencies have varied in how they address this issue. Ultimately, if commissioners do not have adequate access to information, then the benefits of the commission structure-robust group discourse and informed deliberation and decision making-may be hampered.
• While FCC relies heavily on public input to inform its decisions, it tends to do so without giving the public access to the actual text of a given proposal. If parties are able to submit vague summaries that may not fully reflect meetings between FCC officials and outside parties, then stakeholders will continue to question whether commission decisions are being influenced by information that was not subject to public comment or rebuttal and that, in some cases, is submitted just before a commission vote, the GAO stated.

For its part the FCC said it has begun taking steps to address the areas of concern identified by the GAO. For example, the FCC stated that it is in the midst of a review of FCC's existing processes. According to the GAO: "As part of this process, the FCC is reviewing procedures for interbureau communication, as well as prior and current practices for commissioner and staff communication. The FCC stated that it would identify and incorporate lessons learned and best practices into future internal procedures. The FCC did not specifically state whether future policies on commissioner access to bureau and office information during the decision-making process would be made publicly available or provided to FCC's congressional oversight committees," the GAO report stated.

FCC Looks at Ways to Assert Authority Over Web Access
Cecilia Kang

The Federal Communications Commission is considering aggressive moves to stake out its authority to oversee consumer access to the Internet, as a recent court hearing and industry opposition have cast doubt on its power over Web service providers.

The FCC, which regulates public access to telephone and television services, has been working to claim the same role for the Internet. The stakes are high, as the Obama administration pushes an agenda of open broadband access for all and big corporations work to protect their enormous investments in a new and powerful medium.

"This is a pivotal moment," said Ben Scott, director of policy at the public interest group Free Press. The government wants to treat broadband Internet as a national infrastructure, he said, like phone lines or the broadcast spectrum. But federal regulators are grappling with older policies that do not clearly protect consumers' access to the Web, their privacy or prices of service.

The issue may have reached a turning point last week when a federal appeals court questioned the limits of the FCC's authority in a 2008 case involving Comcast. The agency had ordered the Internet and cable giant to stop blocking subscribers' access to the online file-sharing service BitTorrent. But in an oral hearing last Friday, three judges grilled an FCC lawyer over whether the agency had acted outside the scope of its authority.

The appeals court is still hearing the case, but analysts predict that the FCC will lose and that the ruling could throw all of its efforts to oversee Internet access into question. A loss could undermine the legality of FCC Chairman Julius Genachowski's push for policies that would prohibit service providers from restricting customers' access to legal Web content -- the concept known as net neutrality -- and throw into doubt the agency's ability to oversee pricing and competition among Internet service providers.

The agency said it will continue to argue that it had the authority to rule against Comcast, but it is making plans to deal with a loss.

"If the court removes the legal basis for the current approach to broadband, the commission may be compelled to undertake a major reassessment of its policy framework . . . or Congress will have to act," said Colin Crowell, senior adviser to Genachowski. "Any policies the commission pursues for the broadband marketplace will be rooted in the pro-consumer, pro-competitive structure of the 1996 Telecommunications Act, regardless of how the court ultimately decides."

Specifically, that could mean the agency will reverse policies from the past decade that put cable and DSL Internet services in a special category over which the agency has only "ancillary jurisdiction." Those policies were intended to deregulate Internet services in order to promote competition and innovation in the young industry as it developed. Consumer groups argue that they instead reduced competition and drove prices higher.

Analysts said the FCC may look to put broadband services back into a category alongside phone services that is clearly under the authority of the government.

At issue, some FCC officials say, is the future of how Americans will communicate and receive information. One in five U.S. homes has swapped landline telephone service for wireless. Most of those phones have Web browsers that are fast enough to watch videos and navigate traffic in real time. Consumers are also adopting ultra-high-speed Internet services over fiber and cable for 3-D games and videoconferencing.

"While I am still hopeful that we'll win the case, I am absolutely certain that consumers expect protection against gatekeeper control," said Commissioner Michael Copps, a Democrat. "That's why we need to move forward with whatever tools we have at our disposal to ensure an open Internet."

A move to reclassify broadband services would almost certainly be opposed. The telephone category is steeped in decades-long rules that are meant to prohibit blocking of services, protect consumer prices and spur competition. Such rules would be a stark change for Internet service providers that invest billions of dollars each year in networks but also receive high rates of consumer complaints over prices and services.

"To the extent that we need more regulation, we think less is more," said Kyle McSlarrow, head of the National Cable and Telecommunications Association, a trade group. "The more granular and more regulatory we become with practical and legal issues, we can go too far."

The agency also could ask Congress to grant it explicit authority over Internet service providers. But that approach would also face significant barriers, analysts said.

"The odds are against it," said Paul Gallant, an analyst at Concept Capital, a research firm. "Net neutrality is the most controversial issue in the telecom media world, and even with a Democratic majority, it's not easy to pass."

File Sharing Arms Race Commences

The battle between online file-sharers, governments and content providers looks set to intensify with the looming launch of Section 92a.

Under the new laws, ISPs will soon be charged with monitoring and administering the act, resulting in repeat copyright infringers being disconnected and potentially fined.

For file sharers ideologically opposed to the laws, effective digital counter-measures are set to rapidly become the order of the day.

Leading the charge has been bitorrent tracker site, thePirateBay.org, who have finally moved their IPREDATOR virtual private network (VPN) offering, out of semi private beta, to make it available publicly.

Available on a subscription basis for 149 Swedish Kroners (approx NZ$29 per 3 months), iPredator provides an encrypted link between subscribers and the internet which allows the user to "tunnel' data through iPredator servers.

The subscriber's IP address (which can be used for purposes of prosecution) remains hidden, revealing only a second IP address which is provided by iPredator.

Not only does iPredator stand to hinder monitoring agencies charged with tracking copyright infringing downloads from finding the identity of the individual's IP address, but it'll also force monitoring agencies to develop their own counter measures in order to effectively enforce Section 92a.

Whilst other pay to use VPNs already exist and offer similar levels of encryption and IP address security, ThePirateBay are hoping that iPredator's lack of data logging or retention of user details will provide them with a unique selling point.

Because of this, iPredator subscribers stand to theoretically be beyond reach of prosecution should the entertainment industry or law enforcement agencies obtain ThePirateBay's business records through legal means.

iPredators move out of beta to a publicly available offering looks set to kick start a digital arms race between file sharers and regulators as nimble private enterprises and individuals develop new measures to defeat monitoring agencies who will also be seeking to do likewise.

The key question going forwards however will be one of can ISPs and monitoring agencies move fast enough to develop appropriate enforcement capabilities? Should this not prove to be the case, section 92a could be rendered obsolete before it passes into law.

Tor Users Urged To Update After Security Breach

If you use Tor, you're cautioned to update now due to a security breach. In a message on the Tor mailing list dated Jan 20, 2010, Tor developer Roger Dingledine outlines the issue and why you should upgrade to Tor or now: "In early January we discovered that two of the seven directory authorities were compromised (moria1 and gabelmoo), along with metrics.torproject.org, a new server we'd recently set up to serve metrics data and graphs. The three servers have since been reinstalled with service migrated to other servers." Tor users should visit the download page and update ASAP.

Swedes Swap Passwords for Chocolate Treats
Paul O'Mahony

Sweet-toothed Swedes are happy to trade their internet passwords for bars of chocolate, according to a poll carried out by an appalled computer magazine.

The computer buffs behind PC magazine were left reeling after they sent a female reporter out on the town to pose as a representative for an anti-virus company examining computer users' password habits.

Anybody agreeing to answer a few questions was promised a bar of chocolate in return. And despite repeated calls from security experts for internet surfers to keep a tight lid on passwords, the sugary reward proved a distressingly successful lure.

Of the 34 people who agreed to stop and chat, divided equally between men and women, 23 revealed a selection of their passwords to the reporter, in some cases for pay sites but also for social media sites such as Facebook.

In a considerably more scientific study, the magazine also asked 5,000 computer users to assess their password management skills.

A majority of respondents reported using more than five passwords, a fact that sometimes led to problems. Only 30 percent said they never forgot a password. Three out of four said they use the same password in several different places, while two thirds admitted neglecting to change their passwords at least once a year.

Virgin Media 'Trialling Broadband Piracy System'

Fibre optic broadband provider Virgin Media is trialling new technology that could help in the battle against illegal filesharing.

New technology that could help in the battle against illegal filesharing is being trialled by fibre optic cable broadband provider Virgin Media, according to reports.

The company, which specialises in bundles including broadband, digital TV and home phone offerings, is using deep packet inspection technology provided by Detica to battle against piracy.

According to the Times, it is believed that the technology can identify what type of files are being downloaded by web users, but companies cannot use the system to snoop on customers as it does not take into account the IP address.

Talking to the newspaper, a spokesman for Virgin Media said the software has not been designed specifically for the latter purpose.

He added: "It allows us to understand the exact nature of unlawful traffic on our network."

News of the trial has come after Virgin Media revealed it is partnering with Enterprise UK to launch a new initiative designed to help young entrepreneurs start their own businesses.

Verizon Terminating Copyright Infringers’ Internet Access
David Kravets

Verizon is terminating internet service to an unknown number of repeat copyright scofflaws, a year after suggesting it was not adopting a so-called graduated-response policy.

While it was not immediately clear whether other internet service providers were following suit, the move comes as the Recording Industry Association of America and the Motion Picture Association of America are lobbying ISPs and Congress to support terminating internet access for repeat, online copyright offenders.

All the while, the United States has been privately lobbying the European Union to “encourage” so-called three strikes policies, according to leaked documents surrounding a proposed international intellectual property accord.

Verizon was not immediately prepared to comment in detail on the developments, first reported by CNET, or to detail how many of its more than 8 million broadband subscribers it has terminated — although CNET said the number was “small.” The RIAA declined comment.

“We reserve the right to do that,” Verizon spokeswoman Bobbi Henson said in a telephone interview regarding the terminations.

The RIAA announced a year ago it was ending its litigation campaign against individual file sharers, about 30,000 lawsuits in all. Instead, the music industry’s lobbying and litigation arm said it would rely on a series of accords it had reached with “leading” internet service providers, in which ISPs have agreed “on principle” to shut off internet access to customers the RIAA catches file sharing repeatedly.

At that time, in a Jan. 5, 2009 interview, Verizon spokeswoman Ellen Yu said that, in reference to the RIAA announcement: “We are not working with them on this.”

Cara Duckworth, an RIAA spokeswoman, said the same day that “We have an agreement on principle with several leading ISPs but not all, and the agreement on principle is confidential.”

Other than Verizon, none of the leading ISPs have acknowledged practicing what the content industry is calling “graduated response.” Under Verizon’s plan, the ISP notifies customers that unlawful file sharing allegedly is taking place on their accounts — file sharing discovered by the RIAA or other intellectual property holders who actively police networks and IP addresses. Internet service could be terminated perhaps after several warnings.

Charles Dunstone Walks the Walk on Illegal Filesharing

TalkTalk boss sets up petition opposing proposals in new Bill to disconnect alleged illegal filesharers from the internet
Martin Waller

Charles Dunstone and his TalkTalk broadband provider have set up a petition on the No 10 website which urges the abolition of the section of the Digital Economy Bill that would see alleged illegal filesharers disconnected without a fair trial. This hamfisted legislation was introduced at the instigation of the music and film industries and requires firms such as TalkTalk to shut down anyone suspected of illegally downloading content.

Note that “suspected”. They don’t have to prove it in a court of law. “This will result in innocent people being disconnected from the internet,” the petition claims. “This guilty until proven innocent approach violates basic human rights.” Dunstone has pointed out that those who suffer from “wi-fi hijacking”, when crooks hack into their computers and download illegally, would also be penalised.

But Sod’s Law has intervened, Type in “digital” into the No 10 website and you are directed to an unrelated but almost identical petition. This has attracted all of 26 signatures. Dunstone’s has attracted more than 31,000 and you can get there via www.dontdisconnect.us.

In Hollywood, Grappling With Studios’ Lost Clout
Michael Cieply and Brooks Barnes

A proposed sale of Metro-Goldwyn-Mayer, the most powerful and lucrative studio during the golden age of film, drew only meager offers last week, and now Hollywood must confront a troubling question: Are movie studios becoming a financial footnote?

Loaded with debt and virtually at a standstill, MGM — now owned by a consortium that includes Sony, Comcast and the investment firms Providence Equity Partners and TPG — put its skeletal remains on the block in a complicated process that allowed potential bidders to review detailed financial information after showing their bona fides and indicating a price range based on a partial look at the books.

Time Warner, Lionsgate Entertainment and smaller private companies showed interest, but signaled offers of less than $2 billion — and perhaps as low as half that — for a company that was bought in 2004 for about $5 billion.

In a report published by Barclays Capital this month, Anthony J. DiClemente and George L. Hawkey estimated that even studios much healthier than MGM, bitten by falling DVD revenue and a 30 percent decline in operating income from 2007 to 2009, had experienced a sharp reduction in their relative importance to the media companies that own them.

“While we enjoy thinking about the film business, the reality is that film doesn’t matter nearly as much to the stocks of media conglomerates as it previously had,” Mr. DiClemente and Mr. Hawkey wrote.

Looking at Warner Brothers (a unit of Time Warner), Paramount (Viacom), Disney Studios (the Walt Disney Company) and 20th Century Fox (the News Corporation), the Barclays report reckoned that such studios, on average, accounted for only about 10 percent of the “enterprise value” of their parents.

In a separate report published last month by Global Media Intelligence, Roger Smith, an analyst and former film executive, wrote that Universal Studios, with just $170 million in operating income on revenue of $3.8 billion in 2009, was not a significant factor in Comcast’s proposed deal to acquire control of the studio’s parent, NBC Universal.

Susan Arons, a spokeswoman for MGM, declined to comment on the bidding for the studio. In a statement on Friday, the studio said it had finished receiving “indications of interest” from potential bidders and was reviewing them before proceeding.

MGM pays about $300 million a year in interest on a $3.7 billion loan and faces $1 billion in payments in June 2011. The rest of the loan is due the next year. MGM also has a $250 million line of credit that matures in April.

If MGM’s 140 creditors feel bids are too low, Stephen F. Cooper, a turnaround expert hired as chief executive in August, may need to look for another way to salvage the company.

There are backup options. For instance, Qualia Capital, a private equity fund run by the Hollywood veteran Amir Malin, has floated the idea of converting some of the debt to equity, infusing MGM with about $500 million in cash and keeping it going in a stripped-down form until the market improves.

Two people involved with the bidding, who spoke on the condition of anonymity because of restrictions on the discussion of the process, said they believed virtually all of the final bids would require a bankruptcy filing that would allow any new owner to proceed without the old obligations.

Hollywood has been rife with speculation about potential bidders. The News Corporation may wade into the auction, with reports that a bid might involve Peter Chernin, the company’s former president. But Mr. Chernin has “little to no interest” in MGM, according to a spokeswoman.

Meanwhile, some who monitor the film business have been struck by the way MGM’s collapse in value has defied a long-standing bit of conventional wisdom: that studios, like sports teams, may lose money, but their owners ultimately do not.

“I don’t believe, fundamentally, that the value of a movie studio is necessarily going to drop going forward,” said Stephen Prough, a founder of Salem Partners, an investment banking firm in Los Angeles.

Mr. Prough said, however, that tight capital had put a damper on corporate acquisitions, those of movie companies included. And film libraries — a major component in studio value — have decreased in worth over the last three years because of falling home video revenue, even though distributors have had stronger results at the box office.

Mr. Prough declined to comment specifically on the MGM transaction to avoid possible conflicts should his company become involved.

As recently as September, Disney paid $4 billion, a 29 percent premium over market price, to acquire Marvel Entertainment, proving that a film company built around superheroes and fantasy sequels could still command big bucks.

Yet the market capitalization of Lionsgate Entertainment, an independent studio, has tumbled to about $650 million, roughly half what it was three years ago, despite steady additions to its asset base from the filmmaker Tyler Perry, from the “Saw” horror franchise and from the television series “Mad Men.”

Pegging the market value of any particular studio is treacherously difficult because so much depends on the willingness and ability of buyers to pay a premium for access to a glamorous world in which face time with movie stars and tickets to the Oscars remain very much a part of the package.

In the case of MGM, the glamour factor is low. It has all but receded from film production and had only one release last year — a dismally performing remake of “Fame.” MGM controls the James Bond and Pink Panther franchises, and retains potentially lucrative film rights to “The Hobbit.” But without the leverage of new hits, the studio’s 4,000-film library has become less valuable.

In years past, when growing home video revenue helped lift the film business, studios could take considerable abuse and still hold their value. Thus, Kirk Kerkorian, when he owned MGM in its various incarnations, managed to sell the studio profitably at least four times. Before selling to the current owners for $2.85 billion and about $2 billion in assumed debt in 2004, Mr. Kerkorian had bought it from Credit Lyonnais, the French bank, in 1996 for $1.3 billion.

The Coca-Cola Company did similarly well with Columbia Pictures in the 1980s. After buying the studio for about $750 million in 1982, it restructured the operations, and in 1989, sold what by then was a 49 percent interest in Columbia Pictures Entertainment to the Sony Corporation for roughly $5 billion in cash and assumed debt.

Marvin H. Davis, the oil entrepreneur, paid about $480 million to buy 20th Century Fox in a pair of transactions in the early 1980s. He then sold to the News Corporation, controlled by Rupert Murdoch, in stages for about $575 million, having drawn some millions from the studio in cash flow in the interim. The News Corporation still owns Fox, which, Mr. Murdoch pointed out on a recent investors’ conference call, yields more than its purchase price in profit every year.

Following the ins and outs of Universal is more difficult, as the studio went through a series of complicated sales, in which its ownership moved from MCA Inc. to Matsushita to Seagram to Vivendi to General Electric, and now to its proposed owner, a co-venture between G.E. and Comcast.

The bundle of operations within which the studio was sold changed over the years, making it virtually impossible to isolate its exact value. But the buyers appear roughly to have matched what Matsushita paid for the studio when it bought MCA’s various assets, which then included a music company, for $6.6 billion in 1990.

Even Universal, a well-tended studio despite its recent troubles at the box office, may now be worth less, however — at least until some new technology once again raises the value of its library.

“If Comcast wanted to sell Universal as is, I don’t think getting close to $6 billion would be possible,” said Mr. Smith, the analyst.

1500 Blu-Rays

Made in IBM Labs: IBM Research Sets New Record in Magnetic Tape Data Density

Important milestone in storing, protecting and accessing exploding volumes of data as physical infrastructure grows increasingly digital
Press release

IBM researchers today announced they have demonstrated a world record in areal data density on linear magnetic tape – a significant update to one of the computer industry's most resilient, reliable and affordable data storage technologies.

This breakthrough proves that tape technology can increase capacity for years to come, which has important implications, as tape storage systems are more energy efficient and cost-effective than hard disk drive storage systems. As the physical world becomes increasingly networked with sensors, vast amounts of data are amassed in various formats from medical images to security camera feeds to supply chain sensors to financial records. All of this data needs to be archived, replicated for disaster recovery, and/or retained or regulatory compliance.

The scientists at IBM Research – Zurich, in cooperation with the FUJIFILM Corporation of Japan, recorded data onto an advanced prototype tape, at a density of 29.5 billion bits per square inch – about 39 times the areal data density of today's most popular industry-standard magnetic tape product*. To achieve this feat, IBM Research has developed several new critical technologies, and for the past three years worked closely with FUJIFILM to optimize its next-generation dual-coat magnetic tape based on barium ferrite (BaFe) particles.

"This exciting achievement shows that tape storage is alive and strong and will continue to provide users reliable data protection, while maintaining a cost advantage over other storage technologies, including hard disk drives and flash," said Cindy Grossman, vice president, IBM Tape and Archive Storage Systems.

These new technologies are estimated to enable cartridge capacities that could hold up to 35 trillion bytes (terabytes) of uncompressed data**. This is about 44 times*** the capacity of today's IBM LTO Generation 4 cartridge. A capacity of 35 terabytes of data is sufficient to store the text of 35 million books, which would require 248 miles (399 km) of bookshelves.

"This tape storage density demonstration represents a step towards developing technologies to achieve tape areal recording densities of 100 billion bits per square inch and beyond. Such technologies will be necessary to keep up with the rapid increase in digital information. IBM is in the unique position to help clients store, maintain and analyze the wealth of data accumulating, and thus help them achieve efficiencies and advantages in the way they do business," comments Evangelos Eleftheriou, IBM Fellow.
Critical business data is often contained in automated tape libraries, where one or more tape drives service dozens to thousands of tape cartridges. High-end tape libraries can store petabytes – millions of gigabytes – of information. On a per-gigabyte basis, tape systems currently cost about one-fifth to one-tenth of a hard disk drive (HDD) storage systems, depending on the size. Also, tape is by far one of the most energy-efficient storage technologies available today.

For the past several years, scientists from IBM Research - Zurich have dramatically improved the precision of controlling the position of the read-write heads, leading to a more than 25-fold increase in the number of tracks that can be squeezed onto the half-inch-wide tape. In addition, they have developed new advanced detection methods to improve the accuracy of reading the tiny magnetic bits, thereby achieving an increase in the linear recording density of more than 50 percent. Another key enabling technology for achieving the required track-follow performance in this demonstration was a new, low-friction read-write head developed by IBM Research – Almaden, which has also been collaborating with FUJIFILM to develop next-generation media.

IBM has a long history of innovation in magnetic-tape data storage. Its first commercial tape product, the 726 Magnetic Tape Unit, was announced nearly 60 years ago. It used reels of half-inch-wide tape that each had a capacity of about 2 megabytes. The areal density demonstration announced today represents a potential increase in capacity of 17,500,000 times compared with IBM's first tape drive product. This announcement reaffirms IBM's continued commitment and leadership in magnetic tape technology.

Technical details: IBM's world-record achievement leverages notable improvements in four areas of the magnetic tape system:

1. New high-density, dual-coated particulate magnetic tape: Developed by FUJIFILM Corporation in Japan in close collaboration with IBM Research scientists, this next-generation version of its NANOCUBIC(TM) tape uses a new ultra-fine, perpendicularly-oriented barium-ferrite magnetic medium that enables high-density data recording without using expensive metal sputtering or evaporation coating methods.

2. Advanced servo control technologies for ultra accurate head positioning: Three new servo control technologies have been developed by IBM Research - Zurich, leading to a more than 25-fold increase in the number of data tracks that can be squeezed onto the half-inch-wide tape: 1) a new servo pattern, enabling the generation of high-bandwidth nanometer-scale position information; 2) a new method for detecting and decoding the position information encoded in the servo pattern, and 3) advanced state-space-based control concepts that, combined with the other two technologies, culminated in the demonstration of an extremely precise track-follow performance of less than 24 nm standard deviation from the target track position. These technologies were instrumental in reducing the track width to less than 0.45 micrometers.

3. Innovative signal-processing algorithms for the data channel: An advanced data read channel based on a new data-dependent noise-predictive, maximum-likelihood (DD-NPML) detection scheme was developed at IBM Research - Zurich to enable the accurate detection of the data despite the reduction in the signal-to-noise ratio resulting from the use of an ultra-narrow 0.2-µm data reader head. With this technique, which also takes the noise characteristics of FUJIFILM's BaFe medium into account, a linear density increase of more than 50 percent relative to LTO Generation 4 was achieved.

4. Low-friction GMR (giant magnetoresistive) read/write head assemblies: Two new head technologies have been developed by the tape development and research teams at IBM Research - Almaden, namely, a new reduced-friction head assembly that allows the use of smoother magnetic tapes and an advanced GMR head module incorporating optimized servo readers. These head technologies were critical for achieving the required track-follow performance mentioned above.

*The demonstration was performed at product-level tape speeds (2 meters per second) and achieved error rates that are correctable using standard error-correction techniques to meet IBM's performance specification for its LTO Generation 4 products.

**Note that this calculation assumes a roughly 12% increase in tape length due to the reduced medium thickness.

***Note that this has been rounded up from 43.75 times

For more information about IBM Research, visit www.ibm.com/research

ASML Q4 Order Book Seen to Signal Tech Rebound
Harro ten Wolde

Dutch chip equipment maker ASML is expected to report an improvement in orders, indicating a technology sector recovery, but analysts said rising expectations could disappoint if any of the numbers slip.

The world's largest maker of semiconductor lithography machines, which map out electronic circuits on silicon wafers, was forecast to report a further rise in bookings from the third quarter, driven by consumer spending on end products.

There are expected to be 37 new system bookings valued at 813 million euros ($1.17 billion) in the fourth quarter, according to a Reuters poll, up from 35 systems worth 777 million euros in the third quarter.

"End demand for semiconductors is recovering after a very weak period. Capex is rapidly increasing after a virtual standstill in the first half of 2009. This will lead to positive news flow in the coming quarters," Petercam analyst Eric de Graaf said.

ASML's order book, which is in an important indicator for the chip industry, has been improving since the second quarter of 2009 after a virtual stand-still at the end of 2008 and early 2009.

Intel Hopes

The initial order growth was driven by ASML's premium clients, which began investing again to maintain their leading market positions.

These customers include the world's largest chip maker Intel Corp and Samsung, especially for ASML's immersion machines, which allow manufacturers to produce chips with ever-finer structures, and sell at about 30 million euros each.

Analysts expect orders from mass production customers such as the world's largest contract chip maker, Taiwan Semiconductor Manufacturing, will also recover on the back of a rise in chip sales for personal computers, wireless devices and consumer electronics.

Hopes for a rebound of the technology sector were also fueled last week by Intel, which beat analyst expectations and gave a bullish outlook for the sector.

Researchers at Gartner said last month worldwide wafer fabrication equipment spending is expected to increase 56.6 percent in 2010, compared with total global semiconductor spending growth, projected up 45 percent in 2010 to $37 billion.

"At this time, Gartner analysts do not see that a shortage of immersion tools will develop, but the availability of long lead items could limit wafer fab equipment growth in 2010 if the market heats up more," Gartner said.

Outperform Market

Kepler analyst Peter Olofson said he expected ASML, which competes with Japan's Nikon Corp and Canon Inc, to outperform the industry average.

"As the majority of investments continues to be directed toward technology shrinks, demand for lithography tools, which play a key role in feature shrinks, stands to benefit disproportionately," Olofson said.

The big question however will be whether any bullish comments from ASML will be reflected in its shares, which almost doubled in 2009, outperforming the DJ Stoxx European technology index which gained about 20 percent.

ASML shares were down 0.26 percent at 22.8 euros at 1343 GMT.

Of 31 analyst covering ASML 17 rate the shares "Strong Buy" or "Buy," while 10 have a "Hold" rating and 4 rate the shares "Sell" or "Strong Sell," according to Starmine data.

(Editing by Sharon Lindores)

($1=.6949 Euro)

D-Link Issues Fixes for Router Vulnerabilities

Taiwanese firm says flaw could allow hackers to access administrative settings
Jeremy Kirk

Router manufacturer D-Link Corp. today admitted that some of its routers have a vulnerability that could allow hackers access to a device's administrative settings. The Taipei, Taiwan-based form said that it has issued patches to fix the flaws.

According to a Jan. 9 blog post from SourceSec Security Research, some D-Link routers have an insecure implementation of the Home Network Administration Protocol (HNAP), which could allow an unauthorized person to change a router's settings.

SourceSec published a proof-of-concept software tool called HNAP0wn that would enable the hack -- a move that D-Link criticized.

"By publicizing their tool and giving specific instructions, the authors of the report have publicly outlined how the security can be breached, which could have had serious repercussions for our customers," D-Link said in a statement.

D-Link said it only appeared possible to hack the routers using the software tool and not just with stand-alone code.

D-Link and SourceSec differed over which models were vulnerable. SourceSec wrote that it suspected that all D-Link routers made since 2006 with HNAP support were affected, but they said they had not tested all of them.

D-Link said the models affected are the DIR-855 (version A2), DIR-655 (versions A1 to A4) and DIR-635 (version B). Three discontinued models -- DIR-615 (versions B1, B2 and B3), DIR-635 (version A) and DI-634M (version B1) -- are also affected.

The company said new firmware updates are being made available across its Web sites.

Windows Plagued by 17-Year-Old Privilege Escalation Bug

All 32-bit versions vulnerable
Dan Goodin

A security researcher at Google is recommending computer users make several configuration changes to protect themselves against a previously unknown vulnerability that allows untrusted users to take complete control of systems running most versions of Microsoft Windows.

The vulnerability resides in a feature known as the Virtual DOS Machine, which Microsoft introduced in 1993 with Windows NT, according to this writeup penned by Tavis Ormandy of Google. Using code written for the VDM, an unprivileged user can inject code of his choosing directly into the system's kernel, making it possible to make changes to highly sensitive parts of the operating system.

"You can in theory write to memory segments that are otherwise considered highly trusted and sensitive," said Tom Parker, a director in the security consulting services group at Securicon, a Washington, DC-based security practice. "So for example, malware could possibly use it to install a key logger."

The vulnerability exists in all 32-bit versions of Microsoft OSes released since 1993, and proof-of-concept code works on the XP, Server 2003, Vista, Server 2008, and 7 versions of Windows, Ormandy reported. Presumably, Windows 2000 is also susceptible. Immunity, a Miami-based company that makes auditing software for security professionals, has already added a module exploiting the vulnerability to its product called Canvas. The exploit has been tested on all versions of Windows except for 3.1.

Ormandy said the security hole can easily be closed by turning off the MSDOS and WOWEXEC subsystems. The changes generally don't interfere with most tasks since they disable rarely-used 16-bit applications. He said he informed Microsoft security employees of the vulnerability in June.

"Regrettably, no official patch is currently available," he wrote. "As an effective and easy to deploy workaround is available, I have concluded that it is in the best interest of users to go ahead with the publication of this document without an official patch."

Microsoft security officials - who are already working double-duty responding to a potent Internet Explorer bug used to attack Google - said they are looking in to Ormandy's advisory and are not aware of attacks that target the reported vulnerability.

Widespread Attacks Exploit Newly Patched IE Bug
Robert McMillan

The first widespread attack to leverage a recently patched flaw in Microsoft's Internet Explorer browser has surfaced.

Starting late Wednesday, researchers at antivirus vendor Symantec's Security Response group began spotting dozens of Web sites that contain the Internet Explorer attack, which works reliably on the IE 6 browser, running on Windows XP. The attack installs a Trojan horse program that is able to bypass some security products and then give hackers access to the system, said Joshua Talbot, a security intelligence manager with Symantec.

Once it has infected a PC, the Trojan sends a notification e-mail to the attackers, using a U.S.-based, free e-mail service that Symantec declined to name.

As of midday Thursday, Symantec had spotted hundreds of Web sites that hosted the attack code, typically on free Web-hosting services or domains that the attackers had registered themselves.

The IE flaw being leveraged in these attacks was also used to hack into Google's corporate network last December. It has been linked to similar incidents at 33 other companies, including Adobe Systems. Microsoft patched the vulnerability in an emergency security update Thursday morning.

The Google attack hit IE 6 on Windows XP, but over the past week hackers have found ways to exploit the flaw on more recent versions of the browser as well. These latest techniques do not appear to be used on the Web sites Symantec has uncovered. They use the IE 6 exploit code, Talbot said.

Still, with IE 6 still being widely used, the move to more widespread attacks is worrying. "It may be an indication that attackers have finally ramped up their attack toolkits and are now ready to launch widespread attacks," Talbot said.

He believes that the criminals are tricking victims into visiting their Web sites by sending spam e-mail or instant messages with links to sites.

On Thursday, Websense published some sample e-mails used in targeted attacks that exploit the IE bug. A typical subject line is "Helping You Serve Your Customers." The e-mail reads, "I just heard the news: Helping you serve your customers" and includes a link to the malicious Web site.

The e-mails contain spoofed e-mail addresses, designed to fool victims into thinking that they were sent by a colleague. The malicious Trojan used in the attack is not the same one that was used in the Google attack, however.

Websense has seen these e-mails sent to targeted companies in the U.S. and the U.K., said Patrik Runald, a security research manager with Websense. "These attacks are actually continuing; they happened today; they happened yesterday and they happened the day before."

However, Websense believes that the e-mails it has tracked are part of a small-scale targeted attack, similar to those used on Google and Adobe in attacks that are ongoing. Websense has counted only about 25 malicious Web sites to date, but the number is rising fast, Runald said.

Security experts believe this more targeted technique is used as part of a systematic cyber-espionage campaign, which some have linked to China.

The Lock That Says ‘Pick Me’
Steve Lohr

The recent computer attacks on the mighty Google left every corporate network in the world looking a little less safe.

Google’s confrontation with China — over government censorship in general and specific attacks on its systems — is an exceptional case, of course, extending to human rights and international politics as well as high-tech spying. But the intrusion into Google’s computers and related attacks from within China on some 30 other companies point to the rising sophistication of such assaults and the vulnerability of even the best defenses, security experts say.

“The Google case shines a bright light on what can be done in terms of spying and getting into corporate networks,” said Edward M. Stroz, a former high-tech crime agent with the F.B.I. who now heads a computer security investigation firm in New York.

Computer security is an ever-escalating competition between so-called black-hat attackers and white-hat defenders. One of the attackers’ main tools is malicious software, known as malware, which has steadily evolved in recent years. Malware was once mainly viruses and worms, digital pests that gummed up and sometimes damaged personal computers and networks.

Malware today, however, is likely to be more subtle and selective, nesting inside corporate networks. And it can be a tool for industrial espionage, transmitting digital copies of trade secrets, customer lists, future plans and contracts.

Corporations and government agencies spend billions of dollars a year on specialized security software to detect and combat malware. Still, the black hats seem to be gaining the upper hand.

In a survey of 443 companies and government agencies published last month, the Computer Security Institute found that 64 percent reported malware infections, up from 50 percent the previous year. The financial loss from security breaches was $234,000 on average for each organization.

“Malware is a huge problem, and becoming a bigger one,” said Robert Richardson, director of the institute, a research and training organization. “And now the game is much more about getting a foothold in the network, for spying.”

Security experts say employee awareness and training are a crucial defense. Often, malware infections are a result of high-tech twists on old-fashioned cons. One scam, for example, involves small U.S.B. flash drives, left in a company parking lot, adorned with the company logo. Curious employees pick them up, put them in their computers and open what looks like an innocuous document. In fact, once run, it is software that collects passwords and other confidential information on a user’s computer and sends it to the attackers. More advanced malware can allow an outsider to completely take over the PC and, from there, explore a company’s network.

With this approach, the hackers do not need to break through a company’s network defenses because a worker has unknowingly invited them inside.

Another approach, one used in the Google attacks, is a variation on so-called phishing schemes, in which an e-mail message purporting to be from the recipient’s bank or another institution tricks the person into giving up passwords. Scammers send such messages to thousands of people in hopes of ensnaring a few. But with so-called spear-phishing, the bogus e-mail is sent to a specific person and appears to come from a friend or colleague inside that person’s company, making it far more believable. Again, an attached file, once opened, unleashes the spy software.

Other techniques for going inside companies involve exploiting weaknesses in Web-site or network-routing software, using those openings as gateways for malware.

To combat leaks of confidential information, network security software looks for anomalies in network traffic — large files and rapid rates of data transmission, especially coming from corporate locations where confidential information is housed.

“Fighting computer crime is a balance of technology and behavioral science, understanding the human dimension of the threat,” said Mr. Stroz, the former F.B.I. agent and security investigator. “There is no law in the books that will ever throw a computer in prison.”

As cellphones become more powerful, they offer new terrain for malware to exploit in new ways. Recently, security experts have started seeing malware that surreptitiously switches on a cellphone’s microphone and camera. “It turns a smartphone into a surveillance device,” said Mark D. Rasch, a computer security consultant in Bethesda, Md., who formerly prosecuted computer crime for the Justice Department.

Hacked cellphones, Mr. Rasch said, can also provide vital corporate intelligence because they can disclose their location. The whereabouts of a cellphone belonging to an investment banker who is representing a company in merger talks, he said, could provide telling clues to rival bidders, for example.

Security experts say the ideal approach is to carefully identify a corporation’s most valuable intellectual property and data, and place it on a separate computer network not linked to the Internet, leaving a so-called air gap.

“Sometimes the cheapest and best security solution is to lock the door and don’t connect,” said James P. Litchko, a former government security official who is a manager at Cyber Security Professionals, a consulting firm.

Some companies go further, building “Faraday cages” to house their most critical computers and data. These cages typically have a metal grid structure built into the walls, so no electromagnetic or cellphone transmissions can come in or out. Defense contractors, aerospace companies and some automakers have built Faraday cages, named for the 19th-century English scientist Michael Faraday, who designed them to shield electrical devices from lightning and other shocks.

But in the Internet era, isolationism is often an impractical approach for many companies. Sharing information and knowledge with industry partners and customers is seen as the path to greater flexibility and efficiency. Work is routinely done by far-flung project teams. Mobile professionals want vital company data to be accessible wherever they are.

Most of that collaboration and communication is done over the Internet, increasing the risk of outside attacks. And the ubiquity of Internet access inside companies has its own risks. In a case of alleged industrial theft that became public recently, a software engineer at Goldman Sachs was accused last year of stealing proprietary software used in high-speed trading, just before he left for another firm. The engineer, who pleaded not guilty, had uploaded the software to a server computer in Germany, prosecutors say.

The complexity of software code from different suppliers, as it intermingles in corporate networks and across the Internet, also opens the door to security weaknesses that malware writers exploit. One quip among computer security experts is: “The sum of the parts is a hole.”

But, security experts say, the problem goes well beyond different kinds of software not playing well together. The software products themselves, they say, are riddled with vulnerabilities — thousands of such flaws are detected each year across the industry. Several weaknesses, it seems, including one in the Microsoft Internet Explorer browser, were exploited in the recent attacks on Google that were aimed at Chinese dissidents.

The long-term answer, some experts assert, lies in setting the software business on a path to becoming a mature industry, with standards, defined responsibilities and liability for security gaps, guided by forceful self-regulation or by the government.

Just as the government eventually stepped in to mandate seat belts in cars and safety standards for aircraft, says James A. Lewis, a computer security expert at the Center for Strategic and International Studies, the time has come for software.

Mr. Lewis, who advised the Obama administration about online security last spring, recalled that he served on a White House advisory group on secure public networks in 1996. At the time, he recommended a hands-off approach, assuming that market incentives for the participants would deliver Internet security.

Today, Mr. Lewis says he was mistaken. “It’s a classic market failure — the market hasn’t delivered security,” he said. “Our economy has become so dependent on this fabulous technology — the Internet — but it’s not safe. And that’s an issue we’ll have to wrestle with.”

'Shadow Elite': Information Is Power And Who's Controlling Our Information?
Gary Lyndaker

Janine Wedel's "Shadow Elite"--particularly her chapter on "U.S. Government, Inc."-- struck a familiar chord with me. She writes that our national and public interests risk being sold out because core government functions like running intelligence operations, controlling homeland security databases, and managing federal taxpayer monies doled out under the stimulus plans and bailouts are being outsourced to private contractors. Contracting is rampant: Today three-quarters of people working for the U.S. government are not government employees but private contractors. And it is no longer just printing and cleaning and food services that are being contracted out; it is the primary work of government.

Working for the last 17 years in information technology organizations for Missouri state government, I have seen a similarly alarming (and growing) trend on the state level. Over 25 years, as an information systems developer, manager, and administrator in both state and private organizations, I have increasingly come to the conclusion that we are putting our state's operations at risk and compromising the trust of the people of our state by outsourcing core government functions. And outsourcing does not come cheaply.

Let me explain from inside the world of IT. You might think that IT is one of those things like food services that can be easily spun off. Not so. When we talk about information systems and IT, we are not just speaking of geek technology. We are talking about the detailed mapping of an agency's operations into data and automated processes, which then embody and implement the functions of government. Information systems--encompassing software development, maintenance, and operations--hold the government's data, as well as the rules applied to that data and the business processes that make up government functions and services. These systems are also the source for most decision-making reports and analyses that guide decisions (other than those driven by politics or other power struggles). Almost always the analysts, designers, and programmers responsible for the software know the organization's business operations better than anyone else in the organization. When the IT function is outsourced, governments are put at risk. And so is the public's interest.

Here's why. In many of our agencies, at least one key software system was developed by an external organization with little substantial involvement from the state's IT staff. Once these systems are in place, there may be no one in the state's IT organization who knows the system well enough to maintain it. Thus I've witnessed, with alarm, such instances as these:

* Missouri's Medicaid agency has one of the largest budgets in the state. Beginning more than two decades ago, the agency outsourced the development and maintenance of the Medicaid payment system. The system is maintained through a contract that has to be rebid periodically, putting its operation at risk each time the contractor changes. Moreover, the maintenance cost for this system is disguised from public view (because its cost is recorded as a "Program Service," not as an "IT Service") and I believe it is much more costly to taxpayers than doing this work in-house would be. In FY 2009 this cost taxpayers over $55 million--far more than was spent by any other agency on information systems.

* Across the state, other key systems have been developed or configured by external companies and the dependence on those contractors periodically comes to the surface. After only about six years of operation of the state's accounting and human resources system, the contractor that was originally paid tens of millions of dollars announced that it was moving to a new technology and would no longer support our installed version. It has taken threats and negotiations to maintain support by the contractor for the last few years. There is still no long-term solution--and this is the state accounting system!

* After an unfavorable audit a few years ago, the Department of Health and Senior Services found itself in a crisis situation. The department's core public health system had been developed almost completely by contracted programmers and funding for most of those positions was cut off as a result of the audit. The agency had to scramble to create state IT positions so they could retain some of the development staff and their knowledge of the system. Had we lost those individuals, the Department would have struggled to manage the primary public health database in the state.

* The Missouri Department of Revenue, which has been more "political" than most departments, has a history of contracting for the development of information systems, including vital tax systems. Some of their development contractors are no longer in business, leaving the agency with programs they can maintain only with difficulty. At least one contractor knew it had the state in a compromised position and made an exorbitant bid for a system upgrade. Another tax system is running on a version of server software that is more than a decade old. Others of their systems still require desktop software that is out of date and cannot be supported much longer. Overall, it is hard to justify the condition of the systems in this department and, of course, the public has no idea of this situation.

* Most recently, the Office of Administration acquired a software system for tracking federal stimulus funds distributed through the state. For a few months this system appeared to be the most politically visible program in the state. The software package was configured and installed by a local contractor and subcontractor. They did an excellent job considering the deadlines they had to meet. As in most outsourcing situations, however, there was no time, and no dedicated staff, to assure that in-house IT staff understood exactly how to maintain the system. For any critical change or failure in that system, the state has to rely on the original contractor and sub-contractor to make corrections in a timely manner. But, the right people may not be available when they are needed. Their first obligation is to their business, not to the government.

Amazingly, Missouri was one of only three states given an “A” in management of information by Governing Magazine in their 2008 state rankings, so one can imagine the situation in most other states. Missouri’s current IT leaders have indicated some intent to rely more on in-house IT staff and are making other attempts to improve control of IT systems. In addition, Missouri has often been fortunate to work with reliable IT contractors who employ local people, including some who have been state employees for part of their career, so the expertise stays “local” and some loyalty to the state may be preserved. But, if outsourcing expands or if different contractors are chosen, our current good fortune may end.

Tight budgets and political forces are driving Missouri and other state governments toward operating in an emergency mode and we respond by privatizing more government work. As illustrated by the examples given here, an increasing number of the people performing IT work are not state employees and therefore do not possess the unique knowledge of government functions and data and do not have the same priorities and loyalties. In the long run, this can't help but undermine the integrity and reliability of our government.

Foreign Journalists in Beijing Hit by E-Mail Hackers
Edward Wong

At least two foreign journalists living in Beijing have had their Google e-mail accounts hacked, a journalists’ advocacy group in China said Monday. The hackers changed settings so that all Gmail messages would be forwarded to unfamiliar addresses.

The journalists apparently discovered that their accounts had been hacked after Google announced last week that hackers had attempted sophisticated attacks on its security infrastructure. The attacks were traced to mainland China. Google also said that two Gmail accounts had been compromised and, separately, that dozens of people pressing for human rights in China had had their e-mail accounts hacked. In retaliation, Google had said it would talk to the Chinese government about ceasing the practice of self-censorship of its Chinese-language search engine, Google.cn, and that the search company could close down or curtail its operations in China.

The two foreign journalists recently victimized by hackers were among a large number of Gmail users in China who checked their accounts after Google’s announcement and discovered that their accounts had been compromised. In many of those cases, it was unclear exactly when the hackers had broken into the accounts. The attacks are separate from those that were aimed weeks ago at the security infrastructure and of Google and more than 30 other companies and entities, most of them based in Silicon Valley, California.

One of the two journalists is a television reporter in the Beijing bureau of The Associated Press, which has one of the largest foreign news operations in China. E-mail messages in the reporter’s account were being forwarded to an e-mail address that the reporter did not recognize. The reporter said that other people the reporter knew in Beijing had suffered the same kind of attack, though none of the forwarding addresses were the same.

It is unclear whether the attacks are tied to the Chinese government, whose security forces sometimes closely monitor the activities of foreign journalists.

“We remind all members that journalists in China have been particular targets of hacker attacks in the last two years,” the journalists’ advocacy group, the Foreign Correspondents’ Club of China, said in its announcement of the recent attacks on the Gmail accounts.

Several well-known rights advocates in China said last week that their Gmail accounts had been hacked recently. The advocates include Ai Weiwei, the rebellious artist, and Teng Biao, a lawyer. In several instances, the accounts had been set by hackers to forward e-mail messages to unfamiliar addresses, as in the cases of the two journalists.

Meanwhile, a spokeswoman based in Asia for Google said Monday that the larger attacks on the Google infrastructure were part of an ongoing investigation and declined to comment further.

Congress Takes a Bold Stand Against Surveillance Abuses
Glenn Greenwald

Fixating on and condemning abuses of other countries is one of the greatest weapons the U.S. Government wields for distracting attention away from its own transgressions: like those gossip-obsessed individuals endlessly mucking around in and passing judgment on the personal lives of others as a means of ignoring their own failings:

The San Francisco Chronicle, yesterday:

Few expect Google Inc.'s stare-down with China to usher in a new era of openness across the Asian nation, but some believe -- or hope -- it could pressure the government to improve relations with foreign technology companies. . . . The Obama administration issued statements of support for Google, and members of Congress are pushing to revive a bill banning U.S. tech companies from working with governments that digitally spy on their citizens.

Thank God for that, because we all know there's nothing worse than "governments that digitally spy on their citizens," and there are few things that galvanize our righteous members of Congress more than vast domestic surveillance abuses over the Internet:

New York Times, April 15, 2009:

The National Security Agency intercepted private e-mail messages and phone calls of Americans in recent months on a scale that went beyond the broad legal limits established by Congress last year, government officials said in recent interviews.

New York Times, June 16, 2009:

The National Security Agency is facing renewed scrutiny over the extent of its domestic surveillance program, with critics in Congress saying its recent intercepts of the private telephone calls and e-mail messages of Americans are broader than previously acknowledged, current and former officials said. . . .

Supporting that conclusion is the account of a former N.S.A. analyst who, in a series of interviews, described being trained in 2005 for a program in which the agency routinely examined large volumes of Americans’ e-mail messages without court warrants. Two intelligence officials confirmed that the program was still in operation. . . .

Representative Rush Holt, Democrat of New Jersey and chairman of the House Select Intelligence Oversight Panel ... disputed assertions by Justice Department and national security officials that the overcollection was inadvertent. "Some actions are so flagrant that they can’t be accidental," Mr. Holt said. . . . Because each court order could single out hundreds or even thousands of phone numbers or e-mail addresses, the number of individual communications that were improperly collected could number in the millions, officials said.

But as the U.S. Congress is now making clear, it's one thing for a government to abuse domestic surveillance powers, but it's completely intolerable for private telecommunications companies to conspire in that behavior:

ABC News, November 7, 2007:

It would be difficult to say whose e-mail, text messages or Internet phone calls the government is monitoring at any given time, but according to a former AT&T employee, the government has warrantless access to a great deal of Internet traffic should they care to take a peek. . . . [Mark] Klein, who worked for more than 20 years as a technician at AT&T, said that the highly secretive electronics-focused National Security Agency began working with telecom companies to gain wholesale access to vast amounts of data traveling over the Internet.

Surely, the U.S. Congress that is now putting its foot down on private companies cooperating with such abusive spying elsewhere would react very angrily in the face of revelations that it was being done here. Actually, in the face of such revelations less than two years ago, they ended up on a very bipartisan basis legalizing the illegal spying program and immunizing the telecoms that enabled it all. From The New York Sun, July 9, 2008:

Bowing to President Bush's demands, the Senate approved and sent the White House a bill today to overhaul bitterly disputed rules on secret government eavesdropping and shield telecommunications companies from lawsuits complaining they helped America spy on Americans.

It should go without saying that all of the sponsors of the pending bill to ban American companies from collaborating with domestic Internet spying in foreign countries -- the inspirationally-named Global Online Freedom Act of 2009 -- voted in favor of the 2008 bill to legalize what had been the illegal warrantless interception of emails and to immunize telecoms which helped our own government break the law in how it spied on Americans.

That's our Government and political class in a nutshell: vocally condemning other countries for abuses which we ourselves engage in with impunity. Earlier this year, Business Week described how "Senators Charles Schumer (D-N.Y.) and Lindsey Graham (R-S.C.) are making fools of themselves with their war on Nokia Siemens for supplying the Iranian government with equipment that lets authorities monitor wireless phone calls and data transmissions." Why, as Business Week described it, must this crusade be the by-product either of "ignorance or hypocrisy"? Because U.S. law "requires that all wireless carriers provide the technological means for law enforcement authorities to tap wireless accounts" and the Congress has done nothing about mountains of evidence of abuses by the U.S. Government within the U.S.

It goes without saying that countries like China and Iran -- along with many of our closest allies -- are far more repressive of internal dissent than is the U.S. But the role of the American Congress is supposed to be to check surveillance abuses by the U.S. Government and to safeguard the privacy of American citizens inside the U.S. Instead, they do the opposite: flamboyantly condemn transgressions by other governments (at least the ones we don't like) while enabling, empowering and protecting our own government officials and private telecoms who illegally spy within our own country.

FBI Broke Law for Years in Phone Record Searches
John Solomon and Carrie Johnson

The FBI illegally collected more than 2,000 U.S. telephone call records between 2002 and 2006 by invoking terrorism emergencies that did not exist or simply persuading phone companies to provide records, according to internal bureau memos and interviews. FBI officials issued approvals after the fact to justify their actions.

E-mails obtained by The Washington Post detail how counterterrorism officials inside FBI headquarters did not follow their own procedures that were put in place to protect civil liberties. The stream of urgent requests for phone records also overwhelmed the FBI communications analysis unit with work that ultimately was not connected to imminent threats.

A Justice Department inspector general's report due out this month is expected to conclude that the FBI frequently violated the law with its emergency requests, bureau officials confirmed.

The records seen by The Post do not reveal the identities of the people whose phone call records were gathered, but FBI officials said they thought that nearly all of the requests involved terrorism investigations.

FBI general counsel Valerie Caproni said in an interview Monday that the FBI technically violated the Electronic Communications Privacy Act when agents invoked nonexistent emergencies to collect records.

"We should have stopped those requests from being made that way," she said. The after-the-fact approvals were a "good-hearted but not well-thought-out" solution to put phone carriers at ease, she said. In true emergencies, Caproni said, agents always had the legal right to get phone records, and lawyers have now concluded there was no need for the after-the-fact approval process. "What this turned out to be was a self-inflicted wound," she said.

Caproni said FBI Director Robert S. Mueller III did not know about the problems until late 2006 or early 2007, after the inspector general's probe began.

Documents show that senior FBI managers up to the assistant director level approved the procedures for emergency requests of phone records and that headquarters officials often made the requests, which persisted for two years after bureau lawyers raised concerns and an FBI official began pressing for changes.

"We have to make sure we are not taking advantage of this system, and that we are following the letter of the law without jeopardizing national security," FBI lawyer Patrice Kopistansky wrote in one of a series of early 2005 e-mails asking superiors to address the problem.

The FBI acknowledged in 2007 that one unit in the agency had improperly gathered some phone records, and a Justice Department audit at the time cited 22 inappropriate requests to phone companies for searches and hundreds of questionable requests. But the latest revelations show that the improper requests were much more numerous under the procedures approved by the top level of the FBI.

FBI officials told The Post that their own review has found that about half of the 4,400 toll records collected in emergency situations or with after-the-fact approvals were done in technical violation of the law. The searches involved only records of calls and not the content of the calls. In some cases, agents broadened their searches to gather numbers two and three degrees of separation from the original request, documents show.

Bureau officials said agents were working quickly under the stress of trying to thwart the next terrorist attack and were not violating the law deliberately.

FBI officials said they are confident that the safeguards enacted in 2007 have ended the problems. Caproni said the bureau will use the inspector general's findings to determine whether discipline is warranted.

The internal memos were obtained from a government employee outside the FBI, who gained access to them during the investigations of the searches. The employee spoke on the condition of anonymity because the release was unauthorized.

After the Sept. 11, 2001, attacks, the need to get information quickly and connect the dots was considered paramount throughout the federal government. The failure to obtain timely and actionable information has been a recurrent theme in the U.S. counterterrorism effort, up to and including the recent shootings at Fort Hood, Tex.

Before 9/11, FBI agents ordinarily gathered records of phone calls through the use of grand jury subpoenas or through an instrument know as a national security letter, issued for terrorism and espionage cases. Such letters, signed by senior headquarters officials, carry the weight of subpoenas with the firms that receive them.

The USA Patriot Act expanded the use of national security letters by letting lower-level officials outside Washington approve them and allowing them in wider circumstances. But the letters still required the FBI to link a request to an open terrorism case before records could be sought.

Shortly after the Patriot Act was passed in October 2001, FBI senior managers devised their own system for gathering records in terrorism emergencies.

A new device called an "exigent circumstances letter" was authorized. It allowed a supervisor to declare an emergency and get the records, then issue a national security letter after the fact.

The procedure was based on a system used in the FBI's New York office in the days immediately after the Sept. 11 suicide hijackings, officials said.

On Jan. 6, 2003, then-FBI Assistant Director for Counterterrorism Larry Mefford issued a bureau-wide communique authorizing the new tactic, saying the bureau's telephone analysis unit was permitted in "exigent circumstances . . . to obtain specialized toll records information for international and domestic numbers which are linked to subjects of pending terrorism investigations."

The e-mail called this new method of gathering phone records "imperative to the continuing efforts by the FBI to protect our nation against future attacks," even as it acknowledged the phone records of many people not connected to a terrorism investigation were likely to be scooped up.

The 2003 memo stated that the new method "has the potential of generating an enormous amount of data in short order, much of which may not actually be related to the terrorism activity under investigation."

Within a few years, hundreds of emergency requests were completed and a few thousand phone records gathered. But many lacked the follow-up: the required national security letters.

Two individuals began raising concerns.

Special Agent Bassem Youssef, the new supervisor of the communications analysis unit that gathered the records, began to receive complaints from phone companies that they had not received documentation to show the searches were legal.

Youssef, a longtime counterterrorism investigator, had earlier fallen out of favor with FBI management as he pursued a whistleblower claim that he had been wrongly retaliated against and denied promotion because of his ethnicity.

He raised questions in spring 2005 with his superiors and the FBI general counsel's office about the failure to get national security letters. E-mails show he pressed FBI managers, trying to "force their hand" to implement a solution.

Youssef's attorney, Stephen Kohn, said Monday that he could not discuss the specifics of the investigation except to confirm that his client cooperated with the inspector general. FBI officials said they could not discuss the conduct of individual employees.

Separately, Kopistansky in the FBI general counsel's office learned in mid-December 2004 that toll records were being requested without national security letters. She handled a request that originated from then-Executive Assistant Director Gary Bald, who had "passed information regarding numbers related to a terrorist organization with ties to the US" and obtained toll records, the memos show.

The communications analysis unit asked Kopistansky to "draw up an NSL" to cover the search, but she was unable to get superiors to tell her which open terrorism case it involved. The request "has to specify why the numbers are relevant to an authorized investigation," she said.

An employee in the communications analysis unit wrote back that most of the emergency requests he received "come from upper mgmt. I don't always receive documentation or know all the facts related to the number, which is a problem for me when I try to get the NSL."

Kopistansky persisted, demanding an open terrorism case file for the legal rationale. "I am sure you know it is true and Gary Bald knows it's true, but it needs to be reflected on a piece of paper," she wrote.

Two months later, Kopistansky was still unable to issue a national security letter to comply with the FBI rules.

She took note of the overall problem. The issuance of a national security letter after exigent searches "rarely happens," Kopistansky warned in a March 11, 2005, e-mail seeking the help of the FBI's top national security lawyer and the deputy counsel.

By March 2005, Kopistansky and Youssef were discussing a worsening "backlog" of other cases where no national security letters had been issued and growing concerned that exigent letters were being abused, e-mails show.

"I also understand that some of these are being done as emergencies when they aren't necessarily emergencies," Kopistansky wrote in an April 26, 2005, e-mail to Youssef.

Kopistansky and the other FBI lawyers discussed a strategy to handle the past emergency searches and to allow the practice to continue.

The e-mails show that they conceived the idea to open half a dozen "generic" or "broad" preliminary investigative (PI) case files to which all unauthorized emergency requests could be charged so a national security letter could be issued after the fact.

The generic files were to cover such broad topics as "threats against transportation facilities," "threats against individuals" and "threats against special events," the e-mails show.

Eventually, FBI officials shifted to a second strategy of crafting a "blanket" national security letter to authorize all past searches that had not been covered by open cases.

A November 2006 e-mail chain indicates that then-FBI Assistant Director for Counterterrorism Joseph Billy signed the blanket national security letter. But when FBI lawyers raised concerns about it, he wrote back that he did not remember signing.

"I have no recollection of signing anything blanket. NSLs are individual as far as I always knew," Billy wrote Caproni on Nov. 7, 2006.

Billy did not immediately respond to a message left at his office on Monday. Kopistansky and Bald, reached by phone Friday, said they could not comment without FBI approval. Mefford did not return calls.

In all, FBI managers signed 11 "blanket" national security letters addressing past searches, officials told The Post.

Although concerns about their legality first arose in December 2004, exigent searches continued for two more years. Youssef's unit began limiting the number of exigent letters it signed between summer 2005 and spring 2006, seeking more assurances the requests could be covered by a national security letter, the memos show.

Phone record searches covered by exigent letters ended in November 2006 as the Justice Department inspector general began investigating.

Among those whose phone records were searched improperly were journalists for The Washington Post and the New York Times, according to interviews with government officials.

The searches became public when Mueller, the FBI director, contacted top editors at the two newspapers in August 2008 and apologized for the breach of reporters' phone records. The reporters were Ellen Nakashima of The Post, who had been based in Jakarta, Indonesia, and Raymond Bonner and Jane Perlez of the Times, who had also been working in Jakarta.

EFF plans appeal

Court Rules That Mass Surveillance of Americans is Immune From Judicial Review

San Francisco - A federal judge has dismissed Jewel v. NSA, a case from the Electronic Frontier Foundation (EFF) on behalf of AT&T customers challenging the National Security Agency's mass surveillance of millions of ordinary Americans' phone calls and emails.

"We're deeply disappointed in the judge's ruling," said EFF Legal Director Cindy Cohn. "This ruling robs innocent telecom customers of their privacy rights without due process of law. Setting limits on Executive power is one of the most important elements of America's system of government, and judicial oversight is a critical part of that."

In the ruling, issued late Thursday, U.S. District Court Chief Judge Vaughn Walker held that the privacy harm to millions of Americans from the illegal spying dragnet was not a "particularized injury" but instead a "generalized grievance" because almost everyone in the United States has a phone and Internet service.

"The alarming upshot of the court's decision is that so long as the government spies on all Americans, the courts have no power to review or halt such mass surveillance even when it is flatly illegal and unconstitutional," said EFF Senior Staff Attorney Kevin Bankston. "With new revelations of illegal spying being reported practically every other week -- just this week, we learned that the FBI has been unlawfully obtaining Americans' phone records using Post-It notes rather than proper legal process -- the need for judicial oversight when it comes to government surveillance has never been clearer."

Jewel v. NSA is aimed at ending the NSA's dragnet surveillance of millions of ordinary Americans and holding accountable the government officials who illegally authorized it. Evidence in the case includes undisputed documents provided by former AT&T telecommunications technician Mark Klein showing AT&T has routed copies of Internet traffic to a secret room in San Francisco controlled by the NSA. That same evidence is central to Hepting v. AT&T, a class-action lawsuit that's currently under appeal in the U.S. Court of Appeals for the 9th Circuit.

For the judge's full order:

For more on warrantless wiretapping and NSA spying:

Users Spurn Traditional Calls for Skype

Users wanting to call home form abroad are increasingly turning to Skype's Internet telephony service to the detriment of international carriers, new data showed.

"Skype is now the largest provider of cross border communications in the world, by far," said Stephan Beckert, analyst at research firm TeleGeography on Tuesday.

Skype's technology allows consumers to make practically free long-distance calls over the Internet on fixed lines. It is mostly used on desktops but Skype has made the move into mobile too and it now comes pre-installed on some cellphones.

According to the firm's data, over the past 25 years, international call volume from telephones have grown at a compounded annual rate of 15 percent.

In the past two years this growth has however slowed to only 8 percent, rising from 376 billion minutes in 2008 to an estimated 406 billion minutes last year.

By comparison, Skype's on-net international traffic between two Skype users grew 51 percent in 2008, and is projected to grow 63 percent in 2009, to 54 billion minutes.

"The volume of traffic routed via Skype is tremendous," said Beckert.

In general, TeleGeography said, "demand for international voice has been remarkably robust, but it's clearly not recession-proof."

Traffic to Mexico, the world's largest calling destination, declined 4 percent in 2008 for example, and aggregate traffic to Central America declined 5 percent, data showed.

Established in 2003 and based in Luxembourg, privately owned Skype has more than 520 million registered customers who use the free Web service for voice, video or text communication.

But despite its size, its revenue is relatively modest -- at about $551 million in 2008 -- as the company has had a difficult time getting users to pay for its largely free services.

Skype aims to nearly double its annual revenue to $1 billion in two years.

(Reporting by Nicola Leske)

Droid-Buddies Verizon and Google Offer Net Neutrality Truce
Matthew Lasar

Amidst all the rancor that we've seen during the last few weeks over the Federal Communications Commission's proposed net neutrality rules comes a joint filing by Verizon and Google that asks a refreshing question. What do the antagonists have in common regarding this vexing problem?

"Because our businesses rely on each other, it is appropriate for us to jointly discuss a number of things," wrote Alan Davidson of Google and Thomas Tauke of Verizon on Thursday, such as "how we ensure that consumers get the information, products and services they want online; encourage investment in advanced networks; and ensure the openness of the web around the world." And so they've come up with a set of broad principles and the outline of a voluntary industry-wide system for handling network management disputes, with government intervention included only in the most dire cases—a set of "overarching values that create a framework to guide players throughout the Internet space."

It makes sense that Google and Verizon would try this out. As Ars readers know, they don't just "rely on each other," they're business partners now, not just in offering the Droid smartphone on Verizon's network, but in Google's online phone store, as well. "We believe that we need a policy that will ensure openness and preserve the essential character of the Internet as a global, interconnected network of networks and users that is thriving based on a common set of core values," their statement explains.

Does this mean that The War is over? Hot partisans on any side of the Internet non-discrimination debate need not worry about that. Both companies have also filed individual statements with the FCC that offer very different takes on the issue.

"The Commission should adopt a general nondiscrimination rule," advises Google. "This is a well-settled standard that Congress and the FCC have applied in numerous instances to mitigate threats of anticompetitive conduct due to communications providers’ abilities and incentives to discriminate." Au contraire counters Verizon: "Rather than trying to solve a non-existent problem or locking in place particular approaches to Internet services or network management, the Commission should focus on continuing the Internet's success."

Yet Google and Verizon clearly want to dig up some common ground with each other on this problem. Here's what they've unearthed so far.

No central authority

Google/Verizon say that the Internet should function as an "open platform." That means, to them, that "when a person accesses cyberspace, he or she should be able to connect with any other person that he or she wants to—and that other person should be able to receive his or her message," they write. The 'Net should operate as a place where no "central authority" can make rules that prescribe the possible, and where entrepreneurs and network providers are able to "innovate without permission."

Consumers, the statement continues, should enjoy control over all parts of their experience of the Internet. "No entity from either the government or the private sector should wrest control from consumers over how they choose to use the Internet, and the government should not implement policies that would limit consumers’ ability to choose for themselves," Verizon and Google explain. And providers should offer maximum transparency to consumers, giving them "clear and meaningful information" regarding the services they buy and receive.

Limit the FCC's powers

While Google and Verizon disagree about the degree of authority the FCC has to oversee network management, they seem to concur about the agency's limited powers in other areas. Although Congress has given the Commission oversight over radio and television broadcasters, these mandates should not be transferred over to the Internet, the companies warn. There is "no sound reason to impose communications laws or regulations on the robust marketplace of Internet content, applications, and services." Consumer protection rules and concerns about competitiveness should be handled by the Federal Trade Commission, they add.

And any regulation of "online intermediaries" should be governed by the Digital Millennium Copyright Act. "The Commission is not an arbiter of US intellectual property laws," Google/Verizon plainly declare. Copyright is a "delicate balance." The FCC should avoid experiments in the field, especially those that "would prohibit the development of future voluntary cooperative efforts to deter copyright infringement."

Let us police ourselves first

As already noted, Google and Verizon have very different takes on the question of the FCC's oversight over network management, but they do agree that "differential treatment of Internet traffic" by network operators could be "either beneficial or harmful to users." This is probably about as close as a big ISP will get to conceding the potential harmfulness of network discrimination.

"While we do not necessarily agree on which side of the line various practices may fall," Google/Verizon continue, "we do agree that such practices should be evaluated on a case-by-case basis." And while they disagree about whether non-discrimination rules should apply to wireless, they both note that the FCC's Internet Policy Statement emerged from the deregulation of wireline operators. And so: "Any principles applicable to wireless broadband networks should account for the pertinent technical and market circumstances, by acknowledging the flexibility needed for network operators to manage their wireless networks in a reasonable manner."

Still, in general, the Policy Statement offers "useful" language, the Google/Verizon statement concedes, especially the principle that consumers should have "the final say on their web experience." Disputes over problems in this area, however, should first be handled by "self-governing forums." The Internet community "is highly motivated and well positioned to police itself, especially if all players are committed to transparency and inclusiveness," Google and Verizon write.

And so the filers urge the creation of Technical Advisory Groups (TAGs) in three areas: the development of Best Practices for network management, the creation of forums for dispute resolution, and the issuing advisory opinions as needed. The dispute resolution TAG should provide antagonists with a chance to be heard and work the problem out. Unless they can reach a settlement on their own, "the TAG should issue an advisory opinion concerning the particular practices at issue at the conclusion of the dispute resolution process."

But Google and Verizon acknowledge that there needs to be a "backstop role" for the government to step in "if or when bad actors emerge anywhere in the Internet space, and we do agree that involvement should occur only where necessary on a case-by-case base basis." In those instances, intervention should be "surgical, swift and based on a finding of specific facts that establish such harm."

So there you have it—the closest thing, net neutrality-wise, to French and German troops sharing cigarettes, coffee, and schnapps on the Western Front on Christmas eve in 1914. We've got Google acknowledging the importance of a voluntary framework for dealing with Internet discrimination problems, and Verizon cautiously admitting the need for government oversight if all else fails. We've also got a clearly stated set of philosophical promises that we can hold both of these companies to, when, as sure as a byte equals eight bits, they break them.

Analyst: AT&T Needs to Spend US$5B to Catch Up
Stephen Lawson

AT&T would need to spend about US$5 billion on its wireless network to catch up with the coverage offered by Verizon Wireless, a financial research firm said Tuesday.

The public's perception of AT&T's network is poor and declining, apparently because of real shortcomings when compared with Verizon Wireless and Sprint Nextel, said Gerard Hallaren, director of research at TownHall Investment Research. The company hosted a conference call about AT&T for investors in conjunction with WJB Capital Group. TownHall announced it has reduced its rating of AT&T from "Favorable" to "Neutral."

The second-largest U.S. mobile operator has been buoyed by its exclusive deal to sell the popular Apple iPhone -- an edge that is expected to disappear soon -- but has been shortchanging its wireless infrastructure at the expense of its wired network, Hallaren said.

"It has a choice to spend or suffer," Hallaren said.

According to TownHall, AT&T's capital expenditures on its wireless network from 2006 through September 2009 totaled about $21.6 billion, compared with $25.4 billion for Verizon and $16 billion for Sprint (including Sprint's investments in WiMax operator Clearwire). Over that time, Verizon has spent far more per subscriber: $353, compared with $308 for AT&T, Hallaren said. Even Sprint has outspent AT&T per subscriber, laying out $310 for network capital expenditure.

That investment shortfall has been the major cause of AT&T's poor network performance, which has been reflected in tests by Consumer Reports and PC World, Hallaren said. Nine months ago, when TownHall first examined the issue, AT&T itself didn't understand how bad the situation was, he said. Top management now seems to understand the issue, though it's not certain AT&T will actually make the necessary investments, he said.

AT&T's 3G network is based on HSPA (High-Speed Packet Access) 7.2, a system designed to deliver as much as 7.2M bps (bits per second). Verizon uses EV-DO (Evolution-Data Optimized), which that carrier said offers as much as 1.4M bps in real-world performance. The speed of the network for individual subscribers depends on a variety of factors. The PC World test, conducted by Novarum last year, found mixed results for network speeds among AT&T, Verizon and Sprint but showed AT&T in last place for reliability in all 13 cities tested.

AT&T covers 97 percent of the U.S. population and has the nation's fastest 3G network, company spokesman Mark Siegel said.

Part of the problem is that AT&T invests more in its wired infrastructure than in its wireless network, even though the wireless business contributes a majority of the carrier's profit, Hallaren said. AT&T gets 57 percent of its operating income from wireless and only 35 percent from wired services, but wireless only gets 34 percent of the capital expenditures, with the wired network taking up 65 percent of that spending, according to TownHall. It's not clear that the investments in the U-Verse network, which in most cases takes fiber to a neighborhood and relies on copper lines to reach individual homes, will pay off, Hallaren said. Verizon's FiOS uses fiber all the way to homes and can deliver higher speeds, though at a higher deployment cost per home.

The $5 billion investment gap could expand to $7 billion because of the need for new backhaul capacity to link AT&T's wireless network into the wired Internet, Hallaren said. Backhaul is a problem for all mobile operators that will get worse as they increase wireless speeds, he said. Another looming problem for AT&T is that its E911 emergency calling system, which works on its older GSM (Global System for Mobile communications) network, hasn't been adapted to use 3G and is unlikely to make the migration soon, he said. That means AT&T will have to maintain that old network for the foreseeable future, including possibly more capital investment for more power-efficient GSM equipment, according to Hallaren.

Even as AT&T makes these investments, the carrier is likely to lose some subscribers after the end of its exclusive deal for the iPhone, which Hallaren expects to come in May or June. That deal has helped the carrier both to attract subscribers and to generate healthy profit margins, he said.

"This is going to be a juggling act for them," Hallaren said.

AT&T has already done some things right, he added. Moving the 3G service to its longer range 850MHz radio band in the San Francisco area seems to have helped coverage there, and the company will probably take that strategy nationwide while testing coverage in specific areas and "surgically" increasing capacity, Hallaren said. As one of the world's largest GSM carriers, AT&T is also well positioned to roll out LTE (Long-Term Evolution), which is designed to deliver higher speeds more efficiently, and should do it soon, he said. AT&T has said it will begin to introduce LTE next year.

Verizon Users Irked By New Bing Logo

In the past few weeks, a Microsoft Bing logo has popped up on the home screen of Verizon BlackBerry smartphones. And many users aren't too happy about it.

The logo – a shortcut to a new, free Bing app, as Verizon explains – is probably the most visible byproduct of a $500 million agreement Microsoft and Verizon reached in January. It made Bing – well, Live Search back then – the primary search provider on the carrier's smartphones, and it took nearly a year for the deal to hit the eyes of Verizon users.

But customer blow-back prompted Verizon to post instructions on how to bypass the default Bing search function and use another engine. And in the majority of cases, that seems to be Google.

"Verizon Wireless is passionate about ensuring consumer choice in the wireless sector," Jim Gerace, Verizon's vice president for corporate communications, wrote on the carrier's Policy Blog. "Customers still have all the choices they did before. Verizon offers many ramps onto the Internet, including all search engines.

"If you love Google and don't want to use Bing, there are great options."

Until now, Verizon smartphone customers could determine which default search engine to use. Users can hide the Bing logo, but many are irked it's even there at all.

Apple May Replace Google with Bing on iPhone: Report

Apple is in talks with Microsoft to make Bing the default search engine on the iPhone instead of Google, BusinessWeek magazine reported on Wednesday.

BusinessWeek, citing two people familiar with the matter, said the talks have been under way for weeks and reflect the growing rivalry between Apple and Google, which is currently the default search engine on the iPhone.

Google chief executive Eric Schmidt resigned last year from Apple's board of directors and the Internet search and advertising giant recently came out with a smartphone of its own, the Nexus One, seen as a rival to Apple's iPhone.

Apple also recently bought mobile advertising company Quattro Wireless, two months after Google purchased Quattro Wireless rival AdMob.

BusinessWeek said the discussions between Apple and Microsoft on replacing Google with Bing, which Microsoft launched in June, could still unravel and may not be concluded quickly.

The magazine noted that being the default Web search engine on the iPhone carries financial benefits for Google, which collects money from advertising placed alongside search results and shares it with Apple.

BusinessWeek, which was bought recently by Bloomberg financial news agency, said that making Bing the default search engine on the iPhone could require users to adjust the phone settings if they want to search the Web using Google.

The magazine also said that Apple is looking at providing a search option itself and that a deal with Microsoft may be "about buying itself time."

Google is the overwhelming Web search leader with a 65.7 percent share of the US search market in December compared with just 10.7 percent for Bing, according to tracking firm comScore, and also dominates in mobile search.

From October

A Troll Squats On WWWBING.com — Literally
MG Siegler

Last week, we wrote about the best website ever, wwwtwitter.com. Okay, really it’s just a commonly mistyped domain that is currently redirecting to TechCrunch (and the owner actually updated it to direct to my article specifically — thanks, whoever you are!). In that post, I mentioned that while many big name brands own the wwwBRANDNAME.com domain and forward it to their real one, Microsoft did not own it for their current darling site, Bing.

At the time, the domain simply pointed to a page with a bunch of links. But since our story, the author decided to do something a bit more fun with it. As you can see now, wwwbing.com is a lovely page featuring a squatting troll. As a bonus, the troll is picking its nose and snot appears to be dripping out.

The site is titled, “Welcome to Walter Will Wawrinka Bing Fansite,” and it’s supposedly about an upcoming children’s book, due in 2010, that the author hopes “can be as successful as Harry Potter.”

So that might sound at least somewhat legitimate, right? But the funniest part is that Patrick McAuliffe, the owner of the domain also writes, “Feel free to do a search for Walter Will Wawrinka Bing in the following search engines,” and then goes on to list every single search engine besides Bing. Yes, even Lycos, AltaVista, and Excite. Naturally, Google is first.

What else is funny is that a query for “Walter Will Wawrinka Bing” provides absolutely no results at all on any of the search engines (though it may after this post!). This despite McAuliffe writing, “I know I have many fans around the world.”

In case you haven’t gotten the joke yet, let me spell it out: Walter Will Wawrika Bing.

I asked McAuliffe if Microsoft had reached out to him about acquiring the domain. Instead, it was McAuliffe who reached out to Microsoft with a proposal to sell the domain, and here is the response he got back:

Hello Patrick

I was asked by Bill’s team to personally respond to your proposal.

I am a business development manager that works with teams across
Microsoft to manage a review process of unsolicited proposals. We
provide resources, feedback and next steps.

I have forwarded your information to our domain registrations group
for their consideration. This group works directly with the various
business groups on domain names and reviews proposals to determine
alignment with our business.

I do want to help set your expectations on follow-up. Given the
volume of inquiries they receive, they generally only respond where
there is interest on behalf of the business group. Once submitted to
the team, I will no longer have any visibility regarding the
submission or its status. As a general guideline, if you have not
received a response within a two week timeframe, it is unlikely there
is any interest in your domain property.

Thank you for your interest in Microsoft.

Gotta love that Microsoft bureaucracy. But maybe they don’t mind that a site a ton of people are probably mistyping, redirects to a picture of a squatting troll picking its nose that suggest you search on Google. Who knows.

Apparently, they did mind – Jack.

Microsoft to Purge User Data on Bing After 6 Months
Kevin J. O'Brien

Bowing to pressure in Europe, Microsoft on Tuesday said it will redesign the worldwide operation of its online search engine, Bing, to eliminate all data collected on users after six months.

John Vassallo, a Microsoft vice president and associate general counsel, said the company would introduce the changes over the next 18 months, aiming to satisfy a European advisory group that has been critical of how search engines collect and retain data on individuals for advertising purposes.

In 2008, a panel comprised of national privacy regulators from each European Union country asked Microsoft, Google and Yahoo! to eliminate such data, including a computer's unique identification number, location and the text typed into search fields, after six months.

Like other search engines, Microsoft had been keeping user data for more than 18 months. Last year, Microsoft changed its policy to make the individual’s I.P. address anonymous after six months.

So far, only Microsoft has agreed to comply fully with the panel’s request. Google and Yahoo have said they need to hold on to some data longer than six months to refine the functioning of the search engines.

The panel, known as the Article 29 Working Group, held a hearing with representatives of the search engine companies last February, and has given each until the end of January to respond.

“We support what the Article 29 Working Group is doing. That is why we are making this change,” Mr. Vassallo said at news conference in Brussels. “We call on our competitors to do the same.”

Europe is the world’s largest market for Internet searches, accounting for 32 percent of online queries, according to Comscore, a market research firm. Asia-Pacific had 31 percent, and North America, 22 percent of searches according a Comscore report in July. Google has a 67 percent share of the global search market, according to Comscore, but a more than 80 percent share in Europe, where Microsoft has only 2 percent.

Google and Yahoo were not initially available for comment.

While the Article 29 group is only an advisory body at the E.U. level, its members are the ranking privacy regulators from the 27 countries, who hold the power to levy fines nationally or even imprison violators.

So far, however, no country has moved to impose sanctions on the companies over the issue.

But following the ratification last year of the E.U.’s Lisbon Treaty, which redistributed some of the decision-making power within the European Union, the European Commission will gain the ability to initiate E.U.-wide privacy regulations.

Mr. Vassallo said Microsoft's decision to conform to European requests was meant to avert possible new regulation.

“It is possible that the European Union will take a position to regulate this one way or the other,” Vassallo said. “That would need a high level of responsibility from industry. I hope by taking this example we are showing the way. If that happens, we will see less risk of a new regulation.”

Google Sharing

GoogleSharing is a special kind of anonymizing proxy service, designed for a very specific threat. It ultimately aims to provide a level of anonymity that will prevent google from tracking your searches, movements, and what websites you visit. GoogleSharing is not a full proxy service designed to anonymize all your traffic, but rather something designed exclusively for your communication with Google. Our system is totally transparent, with no special "alternative" websites to visit. Your normal work flow should be exactly the same.

The Basic Problem

Google thrives where privacy does not. If you're like most internet users, Google knows more about you than you might be comfortable with. Whether you were logged in to a Google account or not, they know everything you've ever searched for, what search results you clicked on, what news you read, and every place you've ever gotten directions to. Most of the time, thanks to things like Google Analytics, they even know which websites you visited that you didn't reach through Google. If you use Gmail, they know the content of every email you've ever sent or received, whether you've deleted it or not.

They know who your friends are, where you live, where you work, and where you spend your free time. They know about your health, your love life, and your political leanings. These days they are even branching out into collecting your realtime GPS location and your DNS lookups. In short, not only do they know a lot about what you're doing, they also have significant insight into what you're thinking.

Where GoogleSharing Comes In

GoogleSharing is a system that mixes the requests of many different users together, such that Google is not capable of telling what is coming from whom. GoogleSharing aims to do a few very specific things:

1. Provide a system that will prevent Google from collecting information about you from services which don't require a login.
2. Make this system completely transparent to the user. No special websites, no change to your work flow.
3. Leave your non-Google traffic completely untouched, unredirected, and unaffected.

The GoogleSharing system consists of a custom proxy and a Firefox Addon. The proxy works by generating a pool of GoogleSharing "identities," each of which contains a cookie issued by Google and an arbitrary User-Agent for one of several popular browsers. The Firefox Addon watches for requests to Google services from your browser, and when enabled will transparently redirect all of them (except for things like Gmail) to a GoogleSharing proxy. There your request is stripped of all identifying information and replaced with the information from a GoogleSharing identity.

This "GoogleShared" request is then forwarded on to Google, and the response is proxied back to you. Your next request will get a different identity, and the one you were using before will be assigned to someone else. By "sharing" these identities, all of our traffic gets mixed together and is very difficult to analyze.

The GoogleSharing proxy even constantly injects false but plausible search requests through all the identities.

The result is that you can transparently use Google search, images, maps, products, news, etc... without Google being able to track you by IP address, Cookie, or any other identifying HTTP headers. And only your Google traffic is redirected. Everything else from your browser goes directly to its destination.

GoogleSharing Transport

Where Google has failed to provide universal HTTPS support, we have. All requests to a GoogleSharing proxy are sent via HTTPS. These eventually have to be proxied out as HTTP from GoogleSharing to Google, but your traffic is encrypted on the first path.

Running A GoogleSharing Proxy

We've made the proxy code available so that anyone can run a GoogleSharing proxy instance in addition to the one that we're running.

France Offers Loans To Boost Web Speed
Max Colchester

The French government will provide €2 billion ($2.88 billion) to improve the country's high-speed Internet networks, as part of a national loan program to boost the economy through investment in infrastructure.

Prime Minister Francois Fillon said Monday the government would make a series of low-interest loans to telecommunications groups, to encourage them to develop fiber-optic networks outside major cities.

Telecommunications operators are already deploying fiber optic networks in heavily built up areas, such as Paris. But they have been slow to extend these to the provinces, though regular high-speed broadband is available in most of the country.

"We are at the dawn of the era of high-speed Internet and fiber-optic networks," Mr. Fillon said in a speech. "However, 500,000 French people don't have access to high speed Internet at all. This is not acceptable."

The French government wants high-speed Internet connections in smaller cities and rural areas in order to boost productivity. French telecommunications operators have been slow to build the new fiber optic networks in these areas, as there are fewer potential customers in the provinces.

"We are still working on getting fiber to homes in Paris," said Maxime Lombardini, the chief executive of French telecom operator Iliad SA. "Medium-density areas are not where we will make our first investment."

Under the proposed system, telecommunications groups France Telecom SA, Vivendi SA's SFR and Iliad will be encouraged to invest together to build out local fiber networks. This will ensure that no single operator has a monopoly over a network in a particular area, said Mr. Fillon. Subsidies would be offered on a project-by-project basis, he said. Currently the three French operators are carrying out experiments in three towns around Paris to test how they would share access to fiber networks.

In France 11% of French households have access to a fiber connection but relatively few of them have signed up for the service, according to Taylor Reynolds, an economist at the Organization for Economic Cooperation and Development. Nevertheless the government is betting its €2 billion of funds will encourage operators to pump between €6 billion and €7 billion into France's fiber networks, according to Nathalie Kosciusko-Morizet, the minister responsible for the development of the digital economy.

For the most remote areas of France, Mr. Fillon said that a satellite would be developed over the next four years to allow high-speed Internet access without the need to lay down a network. He also called for a low-cost Internet connection for poor households at around 20 euros a month, compared with the current normal rates of around 30 euros.

The announcement is part of a wider national loan program totaling €35 billion, which includes €4.5 billion earmarked for information and communications projects.

Apple vs Google – Benevolent Dictatorship Vs Free Democracy?
D Salmons

The smartphone market has expanded many times over in recent history, and from all indications it is in no danger of slowing any time soon. And while there are many players in the market, it might be interesting to note that the “politics” of smartphone control and development are not unlike that of real world politics.

That is, we have two distinct lines of thought when it comes to your friendly smartphone. The most popular smartphone, the Apple iPhone, is locked down (at least in the States) on both the carrier it will run on and the apps that will run on it.

iPhonevsNexus1 Apple vs Google Benevolent Dictatorship Vs Free Democracy?

Apple – a ruler of the masses and the apps

In this way Apple is like a benevolent dictator, and they gently but firmly mandate the what, where, and how of all things iPhone. Sure, they rule with a velvet glove, but anyone who has gone through the work of jailbreaking an iPhone from scratch (and not just running a kit) can attest to the iron intentions of this ruler. As in real life, communities of rebels have appeared to fight this uncompromising ruler.

Apple seems to have a vision of a Utopian society where everyone has a perfect device that pontificates as much as it innovates. In this vision, the smartphone ruler’s purpose is to decide for the masses what is good and kind to be on their devices, and they aim to keep the evil riffraff away from the innocent users.

Apple manages to rule all things iPhone through the AppStore and its approval process. Apple makes the decision of what apps are fit to be found in this perfect vision. If Apple does not give the thumbs up to a particular app, then it is discarded back into the wastelands. Those apps that are blessed by the powers that be go on to celebrate the largest single mobile sales arena ever created.

Google – Let Free Democracy Ring

In contrast to Apple’s benevolent dictatorship we have Google, who is providing the Android operating system to a free market. The market dictates the configuration, and the huddled masses are free to choose what implementation of Android they want to support with their buying dollars.

In stark contrast to Apple’s App Rule, the end user is free to choose what applications they want to install and run on the device. The trust is put in our hands to choose the device’s purpose and manner of use.

The People’s Choice: Benevolent Dictatorship

So, by looking at these different philosophies, you would think that the Google approach would be the best for both users and developers. However, that may not be the case. In fact, the capitalistic market itself appears to be choosing the iPhone and its dictator. The numbers for the first week of sales are interesting. From the Apple Insider website:

The 20,000 week one sales (of the Nexus One) are well behind the 1.6 million iPhone 3GS handsets sold in June.

1.6 million vs 20 thousand. That is a large gap, and it is quite doubtful that Google will be able to make up the difference in the remaining month. Granted, the iPhone 3GS debuted in eight countries, but even factoring that in the numbers are still far apart.

In fact, the Google Nexus One sold much less than competing Android phones. The Motorola Droid sold 250 thousand in its first week, and even the myTouch 3G sold 60 thousand in its initial week. Put all of the Android sales together and still the market has a clear choice: it’s Apple.

Okay, so the free market apparently favors the benevolent dictatorship. But is that the best for the people? Well, from a developer’s standpoint, that just might be the case.

Benevolent Dictatorship Is better for the people

Consider this – a developer writing an app for the iPhone currently has one screen to write their program for. While this might not seem like a big deal to some, anyone that has tried to support the many devices of Windows Mobile over the years will be loving this.

Another consideration for the app developer is the ease with which to distribute their program. There is one AppStore, and with a single submission you literally hit millions of potential customers.

This single submission system works great for the developer, and the numbers prove it. With over three billion downloads and more than 120,000 apps, the AppStore is by far the most successful mobile application service in history.

Democratic approach Is bad for the developer

With Google, the developer is left practically chasing a given device and not a platform. This is due to not only potential hardware differences in the devices themselves but also in the different versions of the Android OS. Even in its infancy the Nexus One runs a version of Android that is different from the Droid.

The market suddenly dwindles from the collective Android phones to the specific unit. Interestingly enough, the free market approach has just hampered the entrepreneur spirit of the independent developer.

Okay, so it is not exactly the best for the developers, but what about the users? Surely this open approach makes it great for all of the different apps available.

Well, there is the rub. Without a clear path to profit, a lot of developers will not produce apps for a given platform. Sure there will be specific applications for certain functions that many will find useful. And you will even have some big names that will produce for the Android just to have the limited competitors. But the massive numbers of apps for the iPhone (120,000+) will probably dwarf anything on the Android (16,000) for some time to come.

Google’s free market is destroying the Android branding

Ah, but you say that the Google brand will carry Android to a strong position. I have heard this argument before, but let me remind you of a fact earlier in this article – the Google Nexus One has sold less than competing Android phones in its initial week of sales.

This could indicate that the branding is being watered down thanks to the different places you can find an Android phone. The Nexus One is being marketed as “an” Android phone, not “the” Android phone. The typical buyer is confused, and they are left comparing technical notes without a kindly dictator assuring them that this particular unit is the latest and greatest you can find.

Google’s Free democracy is a wolf in sheep’s clothing

Now, so far I have been quite specific about Apple being the benevolent dictator and Google being the free market champion. But a quick look to the side of your browser page may paint a different picture. If you browse anywhere near the sites I tend to frequent, you may find a lot of Nexus One ads popping up in the Google Ads than before. And given the weak sales I certainly can’t blame the push in advertising.

However, what is happening to all of the existing ads that are being shuffled off to make room for the Nexus One ads? They are losing exposure time at not only Google’s expense. From a Webmaster’s World Forum:

Yeah, these terrible ads took over the top spots in many of my ad units. My earnings tanked the minute they appeared.

Google’s advertising arm is long, and they are dictating that ads for their own product will be shown for now. Even CNet draws attention to the fact that Google advertises its product right on the sacredly plain Google home page.

Wow, so even the champion of the people is a dictator when it suits the business model. That is, in order to produce and deliver a given product for a profit to the market, you must be a dictator for at least some part of the process. It just so happens that some carry it much farther than others in their pursuit of their capitalistic goal – profit.

The Verdict – benevolent dictatorship beats free democracy in all things mobile

Whether it is a point of political choice or personal beliefs, it would stand to argue that a free market, with the consumers having the choice, would be the best choice. But as we can plainly see, this is not the case. From Apple severely trouncing the existing free market approach, Windows Mobile, to shoving back the new kid on the block, Android, the people have spoken.

The people want someone to make the mobile waters safe. The people want someone to take them by the hand and lead them to the best choices. And this someone IS Apple.

New York Times Ready to Charge Online Readers
Gabriel Sherman

New York Times Chairman Arthur Sulzberger Jr. appears close to announcing that the paper will begin charging for access to its website, according to people familiar with internal deliberations. After a year of sometimes fraught debate inside the paper, the choice for some time has been between a Wall Street Journal-type pay wall and the metered system adopted by the Financial Times, in which readers can sample a certain number of free articles before being asked to subscribe. The Times seems to have settled on the metered system.

One personal friend of Sulzberger said a final decision could come within days, and a senior newsroom source agreed, adding that the plan could be announced in a matter of weeks. (Apple's tablet computer is rumored to launch on January 27, and sources speculate that Sulzberger will strike a content partnership for the new device, which could dovetail with the paid strategy.) It will likely be months before the Times actually begins to charge for content, perhaps sometime this spring. Executive Editor Bill Keller declined to comment. Times spokesperson Diane McNulty said: "We'll announce a decision when we believe that we have crafted the best possible business approach. No details till then."

The Times has considered three types of pay strategies. One option was a more traditional pay wall along the lines of The Wall Street Journal, in which some parts of the site are free and some subscription-only. For example, editors and business-side executives discussed a premium version of Andrew Ross Sorkin's DealBook section. Another option was the metered system. The third choice, an NPR-style membership model, was abandoned last fall, two sources explained. The thinking was that it would be too expensive and cumbersome to maintain because subscribers would have to receive privileges (think WNYC tote bags and travel mugs, access to Times events and seminars).

The Times has also decided against partnering with Journalism Online, the start-up run by Steve Brill and former Journal publisher L. Gordon Crovitz. It has rejected entreaties by News Corp. chief digital officer Jon Miller, who is leading Rupert Murdoch’s efforts to get rival publishers onboard to demand more favorable terms from Google and other web aggregators. This fall, Miller met with Times digital chief Martin Nisenholtz, but nothing came of the talks.

The decision to go paid is monumental for the Times, and culminates a yearlong debate that grew contentious, people close to the talks say. In favor of a paid model were Keller and managing editor Jill Abramson. Nisenholtz and former deputy managing editor Jon Landman, who was until recently in charge of nytimes.com, advocated for a free site.

The argument for remaining free was based on the belief that nytimes.com is growing into an English-language global newspaper of record, with a vast audience — 20 million unique readers — that, Nisenholtz and others believed, would prove lucrative as web advertising matured. (The nytimes.com homepage, for example, has sold out on numerous occasions in the past year.) As other papers failed to survive the massive migration to the web, the Times would be the last man standing and emerge with even more readers. Going paid would capture more circulation revenue, but risk losing significant traffic and with it ad dollars. At an investor conference this fall, Nisenholtz alluded to this tension: "At the end of the day, if we don't get this right, a lot of money falls out of the system."

But with the painful declines in advertising brought on by last year's financial crisis, the argument pushed by Keller and others — that online advertising might never grow big enough to sustain the paper's high-cost, ambitious journalism — gained more weight. The view was that the Times needed to make the leap to some form of paid content and it needed to do it now. The trick would be to build a source of real revenue through online subscriptions while still being able to sell significant online advertising. The appeal of the metered model is that it charges high-volume readers while allowing casual browsers to sample articles for free, thus preserving some of the Times' online reach.

Landman disputes the notion of competing factions. "The idea of two camps is just wrong. There's many shades to this,” he told me. Inside the newsroom, the protracted talks have frustrated staffers who want clarity on where the paper is headed. “It’s a real problem,” one staffer explained. “It’s embarrassing and reflects badly on the Times that they can’t make a decision. They’re fighting among themselves.”

What makes the decision so agonizing for Sulzberger is that it involves not just business considerations, but ultimately a self-assessment of just what Times journalism is worth to the world. This fall, Keller told the Observer that at some point, the decision is a “gut call about what we think the audience will accept.” Hanging over the deliberations is the fact that the Times’ last experience with pay walls, TimesSelect, was deeply unsatisfying and exposed a rift between Sulzberger and his roster of A-list columnists, particularly Tom Friedman and Maureen Dowd, who grew frustrated at their dramatic fall-off in online readership. Not long before the Times ultimately pulled the plug on TimesSelect, Friedman wrote Sulzberger a long memo explaining that, while he was initially supportive of TimesSelect, he’d been alarmed that he had lost most of his readers in India and China and the Middle East.

“As we got into it, it was clear to me I was getting cut off from a lot of my readers in India and China where 50 dollars per year would be equal to a quarter of college tuition,” Friedman recently told me by phone. “What was coming to me anecdotally from my travels was the five worst words that as a columnist you ever want to hear: ‘I used to read you before you went behind the wall.’”

Friedman is now “pro some kind of pay model,” he says. “My own feeling is, we have to do anything we can to raise money,” he told me. “At some point we gotta charge for our product.”

I asked Friedman whether any of the technologists he meets during his globe-trotting had presented any groundbreaking ideas for how to save the Times and journalism. While he’s optimistic about the coming crop of tablets and e-readers, the answer is no. “We’re in a megatransition. It hasn’t ever felt like anyone has the answer,” he said. “My macro feeling is that I’m glad I had this job at this time. It was great working at the paper when it was on dead trees and could pay for itself.”

Report: 44% Of Google News Visitors Scan Headlines, Don’t Click Through
Robin Wauters

Research firm Outsell has published its third annual News Users’ report, which is based on a survey about the online and offline news preferences of 2,787 US news consumers.

The Outsell report unsurprisingly predicts ongoing, steep drops in US newspapers’ print circulation as consumers continue to head online for news consumption and sharing, forecasting 3.5 percent annual declines in both daily and Sunday circulation by 2012.

Interestingly enough, the research also talks of what is referred to as the “dramatic effect” aggregators like Google and Yahoo have had on print and online readership.

Says analyst Ken Doctor: “Though Google is driving some traffic to newspapers, it’s also taking a significant share away. A full 44 percent of visitors to Google News scan headlines without accessing newspapers’ individual sites.”

Outsell says that for “news right now”, which I’m presuming are the most current news items, 57 percent of users now go to digital sources, up from 33 percent a few years ago. They’re also likelier to turn to an aggregator (31 percent) than a newspaper site (8 percent) or other site (18 percent). This is in line with what Erick Schonfeld recently wrote about media bundles dying at the expense of smart aggregators.

That the Internet is eating away newspapers’ readership bit by bit rings true to me, but frankly I have a hard time believing that close to half of all Google News visitors never click through to a newspaper site.

In my own experience, I find the summary that gets posted on Google News or other aggregators too short when a news item truly interests me, and I always end up clicking through.

How many of you treat Google News like a destination for online news consumption rather than a starting point?

Other findings from the report:

- Only 10 percent of news users are willing to pay for a print newspaper subscription to gain online access
- 75 percent say they’d turn to a different source for local online news if their newspapers required a paid subscription
- Local newspapers retain strength with local topics, such as family events and entertainment

Attributor Study Finds Pervasive Online Book Piracy
Jim Milliot

Publishers could be losing out on as much as $3 billion to online book piracy, a new report released today by Attributor estimates. Attributor, whose FairShare Guardian service monitors the Web for illegally posted content, tracked 913 books in 14 subjects in the final quarter of 2009 and estimated that more than 9 million copies of books were illegally downloaded from the 25 sites it tracked. Although Attributor needs to make some projections to arrive at total numbers, the hard figures the survey uncovered are disturbing to any publisher worried about the possible impact of piracy of e-books.

From the four sites that make digital download data available--4shared.com, scribd.com, wattpad.com, and docstoc.com--Attributor found 3 million illegal downloads in the final quarter of 2009 of the 913 books followed. The company estimates those four sites represent about one-third of all book piracy. (Attributor calculated the share of piracy based on 53,000 book takedown notices sent out to various Web sites in the second half of 2009).

Attributor’s Rich Pearson said he was surprised about how bad the piracy problem has become since the company became more involved with book publishing over a year ago. Of the 14 book categories tracked, piracy was most prevalent in the business and investing segment which had an average of 13,000 free downloads per title, the report found. The professional and technical segment was a close second followed by science, and computer and Internet. The average number of free fiction downloads was just over 2,000, the study found. Pearson said he wasn’t surprised to find a “high correlation” between books that are illegally downloaded and subject areas that students are the most interested in. Still, the survey found lots of illegal fiction downloads with Attributor finding 7,951 illegal downloads of Angels and Demons and 1,604 downloads of The Girl with the Dragon Tattoo. In nonfiction, Architect’s Drawings was downloaded 9,715 times.
Pearson said sites are very good at responding to takedown requests, saying that about 98% of requests are acted on. With piracy growing and the digital book market becoming more important, publishers need to have a strategy in place on how to respond, Pearson said

Offline Book "Lending" Costs U.S. Publishers Nearly $1 Trillion

Hot on the heels of the story in Publisher's Weekly that "publishers could be losing out on as much $3 billion to online book piracy" comes a sudden realization of a much larger threat to the viability of the book industry. Apparently, over 2 billion books were "loaned" last year by a cabal of organizations found in nearly every American city and town. Using the same advanced projective mathematics used in the study cited by Publishers Weekly, Go To Hellman has computed that publishers could be losing sales opportunities totaling over $100 Billion per year, losses which extend back to at least the year 2000. These lost sales dwarf the online piracy reported yesterday, and indeed, even the global book publishing business itself.

From what we've been able to piece together, the book "lending" takes place in "libraries". On entering one of these dens, patrons may view a dazzling array of books, periodicals, even CDs and DVDs, all available to anyone willing to disclose valuable personal information in exchange for a "card". But there is an ominous silence pervading these ersatz sanctuaries, enforced by the stern demeanor of staff and the glares of other patrons. Although there's no admission charge and it doesn't cost anything to borrow a book, there's always the threat of an onerous overdue bill for the hapless borrower who forgets to continue the cycle of not paying for copyrighted material.

To get to the bottom of this story, Go To Hellman has dispatched its Senior Piracy Analyst (me) to Boston, where a mass meeting of alleged book traffickers is to take place. Over 10,000 are expected at the "ALA Midwinter" event. Even at the Amtrak station in New York City this morning, at the very the heart of the US publishing industry, book trafficking culture was evident, with many travelers brazenly displaying the totebags used to transport printed contraband.

As soon as I got off the train, I was surrounded by even more of this crowd. Calling themselves "Librarians", they talk about promoting literacy, education, culture and economic development, which are, of course, code words for the use and dispersal of intellectual property. They readily admit to their activities, and rationalize them because they're perfectly legal in the US, at least for now.

Typical was Susanne from DC, who told me that she's been involved in lending operations for over 15 years. This confirms our estimate that "lending" has been going on for over ten years, beyond even Google's memory. Our trillion dollar estimate may thus be on the conservative side. Of course, it's impossible to tell how many of these lent books would have been purchased legally if "libraries" were not an option, but we're not even considering the huge potential losses to publishers when "used" books are resold for pennies on the black markets.

The communications backbone for this vast enterprise appears to be Twitter. Already, there is constant chatter on the #alamw10 hashtag. Most messages are clearly coded references to illicit transactions. For example a trafficker with the alias "@libacat" tweets "Have to be on the bus to the airport at 6:41 tomorrow morning to make it to the airport to get on my plane to #alamw10". At first glance, it seems like a mundane tweet about travel plans, but the breathtaking ordinariness and triple redundancy is more likely a secret code. How else to understand @scolford's (correction: retweet of @SonjaandLibrary replying to @BPLBoston) tweet; "curling my toes in joy at the thought of visiting your library"?

I've attended this meeting before. When I register for the book lending confab, I'll be presented with an encrypted document labeled the "program", which once decoded, will tell me where I can meet other book traffickers, discuss arcane trafficker lore, and drink trafficker beer. It's thick with secret code words like YALSA, LITA and NMRT, and no apparent rhyme or reason in its layout, evidently to frustrate outside investigators. I'll be lucky if I can find a bathroom.

Two places I'll be sure to find this weekend will be the OCLC Blog Salon on Sunday evening and the Chinatown Storefront Library on Saturday afternoon. Say hello if you see me.

A more serious post on Attributor is forthcoming.

With Kindle, the Best Sellers Don’t Need to Sell
Motoko Rich

Here’s a riddle: How do you make your book a best seller on the Kindle?

Answer: Give copies away.

That’s right. More than half of the “best-selling” e-books on the Kindle, Amazon.com’s e-reader, are available at no charge.

Although some of the titles are digital versions of books in the public domain — like Jane Austen’s “Pride and Prejudice” — many are by authors still trying to make a living from their work.

Earlier this week, for example, the No. 1 and 2 spots on Kindle’s best-seller list were taken by “Cape Refuge” and “Southern Storm,” both novels by Terri Blackstock, a writer of Christian thrillers. The Kindle price: $0. Until the end of the month, Ms. Blackstock’s publisher, Zondervan, a division of HarperCollins Publishers, is offering readers the opportunity to download the books free to the Kindle or to the Kindle apps on their iPhone or in Windows.

Publishers including Harlequin, Random House and Scholastic are offering free versions of digital books to Amazon, Barnes & Noble and other e-retailers, as well as on author Web sites, as a way of allowing readers to try out the work of unfamiliar writers. The hope is that customers who like what they read will go on to obtain another title for money.

“Giving people a sample is a great way to hook people and encourage them to buy more,” said Suzanne Murphy, group publisher of Scholastic Trade Publishing, which offered free downloads of “Suite Scarlett,” a young-adult novel by Maureen Johnson, for three weeks in the hopes of building buzz for the next book in the series, “Scarlett Fever,” out in hardcover on Feb. 1. The book went as high as No. 3 on Amazon’s Kindle best-seller list.

The digital giveaways come as publishers are panicking about price pressure on e-books in general. Amazon and other online retailers have set $9.99 as the putative e-book price for new releases and best sellers, and publishers worry that such pricing ultimately creates expectations among consumers that new books are no longer worth, say, $25 (the average list price of a new hardcover), or even $13 (a standard list price for trade paperbacks).

Some publishers have tried to take control of pricing by delaying the publication of certain e-books for several months after the books are made available in hardcover.

Executives at some houses said that given such actions, offering free content amounts to industry hypocrisy.

“At a time when we are resisting the $9.99 price of e-books,” said David Young, chief executive of Hachette Book Group, the publisher of James Patterson and Stephenie Meyer, “it is illogical to give books away for free.”

Similarly, a spokesman for Penguin Group USA said: “Penguin has not and does not give away books for free. We feel that the value of the book is too important to do that.”

But some publishers regard free digital books as purely promotional, in the same vein as the free galleys they distribute to booksellers and reviewers to create attention and word-of-mouth buzz for an author.

“Most people purchase stuff because somebody has recommended the title,” said Steve Sammons, executive vice president for consumer engagement at Zondervan.

Neither Amazon nor other e-book retailers make any money on these giveaways either. But it is a way of luring customers to their e-reading devices.

Free e-books are also a way of distinguishing a less-well-known author from the marketing juggernauts of the most popular books.

“You have to show people things because there’s a lot of competition,” said Ms. Johnson, the author of “Suite Scarlett” and seven other books. “If they go into a store, they are going to see 4,000 books with Robert Pattinson’s face on it,” she added, referring to movie-tie-in versions of Ms. Meyer’s “Twilight” series. “Then my book will be buried under them.”

And if a free e-book rises to the top of the Kindle best-seller list — or Barnes & Noble’s ranked list of free e-books — it automatically gives an author more visibility.

“When you push to No. 1 of any best-seller list, that in itself seems to beget publicity,” said Brandilyn Collins, who writes suspense novels with Christian themes and whose novels “Exposure” and “Dark Pursuit” were No. 1 and 2 on the Kindle best-seller list earlier this month and remain in the Top 10 (and are still available free).

Most of the giveaways are of older titles by an author, with the idea that reading them will convert new fans who will go on to buy more recently released books. Even if only a small percentage of those who download a free book end up buying another one, “that’s all found money,” said Steve Oates, vice president for marketing at Bethany House Publishers, a unit of Baker Publishing Group, whose authors Beverly Lewis and Tracie Peterson had free titles on the Kindle best-seller list this week.

Samhain Publishing, a publisher of romance and erotica, has offered a free e-book title every two weeks for more than a year. Christina Brashear, its publisher, said that the giveaways have led to a noticeable bump in sales.

In October, the most recent month for which she has statistics, Ms. Brashear said Samhain offered free digital versions of “Giving Chase,” a romance novel by Lauren Dane, leading to 26,897 downloads.

But paid purchases of some of Ms. Dane’s other novels jumped exponentially. Her earlier novel “Chased,” which sold 97 copies in September, sold 2,666 digital units in October, and another of her previous books, “Taking Chase,” which sold 119 copies in September, sold 3,279 in the month in which a free download was available.

With e-books still representing about 5 percent of the total book market, data on the effect of digital giveaways is still inconclusive. Brian O’Leary, a principal at Magellan Media Consulting Partners, which advises publishers, said that while it appeared that free downloads led to an uptick in actual book buying, there was a risk that free reading could eventually “supplant paid reading.”

Indeed, said Brian Murray, chief executive of HarperCollins, “free is not a business model.”

Authors are torn between wanting to experiment with new formats and wanting to protect their income. Charlie Huston, the author of the Henry Thompson crime trilogy and a series of books about Joe Pitt, a vampire detective, said that “the part of me that grew up in a union household” still feels as if he were occasionally undermining himself by sanctioning digital giveaways by his publisher, Random House.

But, he said, “I guess my attitude right now is that I can be afraid of what’s coming or I can try and aggressively embrace it in some form.”

And in some cases, the free e-books work. Pamela Deron, a 29-year-old administrative assistant in Florida, said she downloaded a free edition of “Already Dead,” the first in the Joe Pitt series, onto her Kindle this month.

“There are so many authors out there that fall into obscurity,” Ms. Deron wrote in an e-mail message. “Simply no one knows of them, and some readers are hesitant buying an author they never heard of. Free books allow you to experience the writer as a whole, not just a small tidbit.”

She added: “Fifty dollars later, I have the entire Joe Pitt series.”

Apple in Talks with HarperCollins to Take on Amazon
Jeffrey A. Trachtenberg

HARPERCOLLINS Publishers is negotiating with Apple to make electronic books available for the introduction of a new tablet device from Apple, according to people familiar with the situation, posing a challenge to Amazon.com.

HarperCollins is expected to set the prices of the e-books, which would have added features, with Apple taking a percentage of sales. Details haven't been ironed out.

It couldn't be learned whether Apple will sell the HarperCollins titles via a new e-book store or through its existing iTunes Store, which sells music, television shows and movies.

Other publishers also have met with Apple, people familiar with the matter said. Apple declined to comment. Apple yesterday invited reporters to a San Francisco event on January 27 at which it is expected to unveil its tablet. As is typical with Apple, the emailed invitation was short on detail.

"Come see our latest creation," the message said, below splotches of bright-coloured paint surrounding a white Apple logo.

But people briefed by the company have said Apple plans to introduce a multimedia tablet that it plans to ship in March.

Brian Murray, the chief executive of HarperCollins, said in December that e-books enhanced with video, author interviews and social-networking applications could command higher retail prices for publishers than current e-books.

Many of the country's largest publishing houses are worried about the sale of new bestsellers for only $US9.99 ($10.75) in the e-book format. New releases of enhanced e-books could sell for $US14.99 to $US19.99, a person familiar with the situation said.

HarperCollins is a unit of News Corporation, which also owns The Wall Street Journal and The Australian.

The HarperCollins negotiations with Apple represent a direct challenge to Amazon, which dominates the fast-growing e-book market but which could face significant competition from an Apple tablet.

HarperCollins is one of several major publishing houses that are holding back e-book versions of some new hardcover best sellers. The HarperCollins account of the 2008 presidential election, Game Change, by John Heilemann and Mark Halperin, was released in hardcover January 11 but the e-book edition doesn't go on sale until February 23.

Enhanced e-books likely would be available for sale simultaneously with the hardcovers.

Amazon created the e-book market by making the $US9.99 price for best sellers an integral part of its introduction of the Kindle e-book reader in November 2007. But the Kindle lacks colour and video capabilities, two elements that are likely to be crucial to the future of enhanced e-books.

Amazon could be shut out of enhanced e-books until the Kindle offers those features. The standard Kindle costs $US259, however, while analysts expect Apple's tablet to cost about $US1000. A spokesman for Amazon declined comment.

Although publishers continue to receive approximately half the price of hardcover books, many in the publishing community expect that Amazon and other e-book retailers will eventually seek to pay publishers less. Publishers also worry that pricing new e-book best sellers at $US9.99 persuades some consumers that all new books are only worth $US10 or so.

—Yukari Iwatani Kane contributed to this article.

Amazon Ups Royalty on Low-Cost Books Sold on Kindle

Online retailer Amazon.com Inc introduced a plan on Wednesday to offer authors and publishers a bigger cut of the discount books sold on its popular Kindle electronic reader.

Under the new program, which goes into effect on June 30, authors and publishers will get 70 percent of a book's list price, net of delivery costs. The plan is limited to books whose list price is between $2.99 and $9.99.

The higher royalty program is also restricted to books whose list price is at least 20 percent below the lowest listed price for the physical book, Amazon said.

The Kindle e-reader, introduced in 2007, has been a top selling item for Amazon. But it faces pressure from Barnes & Noble Inc and Sony Corp's rival e-readers.

Authors typically get between 7 percent and 15 percent of the list price for their physical books, or 25 percent of the net proceeds publishers get for their digital books, Russ Grandinetti, vice president of Kindle Content, said in a statement.

The statement did not specify what the current royalty rates are for books targeted by Amazon's new program.

(Reporting by Phil Wahba in New York and Nivedita Bhattacharjee in Bangalore; Editing by Derek Caney)

James Patterson Inc.
Jonathan Mahler

Like most authors, James Patterson started out with one book, released in 1976, that he struggled to get published. It sold about 10,000 copies, a modest, if respectable, showing for a first novel. Last year, an estimated 14 million copies of his books in 38 different languages found their way onto beach blankets, airplanes and nightstands around the world. Patterson may lack the name recognition of a Stephen King, a John Grisham or a Dan Brown, but he outsells them all. Really, it’s not even close. (According to Nielsen BookScan, Grisham’s, King’s and Brown’s combined U.S. sales in recent years still don’t match Patterson’s.) This is partly because Patterson is so prolific: with the help of his stable of co-authors, he published nine original hardcover books in 2009 and will publish at least nine more in 2010.

There are many different ways to catalog Patterson’s staggering success. Here are just a few: Since 2006, one out of every 17 novels bought in the United States was written by James Patterson. He is listed in the latest edition of “Guinness World Records,” published last fall, as the author with the most New York Times best sellers, 45, but that number is already out of date: he now has 51 — 35 of which went to No. 1.

Patterson and his publisher, Little, Brown & Co., a division of the Hachette Book Group, have an unconventional relationship. In addition to his two editors, Patterson has three full-time Hachette employees (plus assistants) devoted exclusively to him: a so-called brand manager who shepherds Patterson’s adult books through the production process, a marketing director for his young-adult titles and a sales manager for all his books. Despite this support staff and his prodigious output, Patterson is intimately involved in the publication of his books. A former ad executive — Patterson ran J. Walter Thompson’s North American branch before becoming a full-time writer in 1996 — he handles all of his own advertising and closely monitors just about every other step of the publication process, from the design of his jackets to the timing of his books’ release to their placement in stores. “Jim is at the very least co-publisher of his own books,” Michael Pietsch, Patterson’s editor and the publisher of Little, Brown, told me.

A couple of months ago, I sat in on one of Patterson’s regular meetings with Little, Brown to discuss the marketing and publicity for his coming titles. The meeting was held not, as you might expect, at the publisher’s offices in Midtown Manhattan but in the living room of Patterson’s Palm Beach home, a canary yellow Spanish-style house on a small island in Lake Worth. Patterson’s wife, Sue, a tall, athletic-looking blonde whom he met at J. Walter Thompson, served coffee and gooey chocolate-chip cookies to the guests: Pietsch; Megan Tingley, the publisher of Little, Brown’s young-readers books; and David Young, the C.E.O. of Hachette.

Pietsch and Tingley showed mock-ups of covers and presented ideas they had been working on. From the plush, caramel-colored couch facing them, Patterson, who is a trim 62 with a habitual slouch and laconic manner well suited to his dry sense of humor, acted as creative director, a familiar role from his years in advertising. At one point, the conversation turned to the next installment in Patterson’s Michael Bennett series, which revolves around a Manhattan homicide detective and widower with 10 multiracial adopted children (“Cheaper by the Dozen” meets “Die Hard,” as Patterson describes it). Pietsch mentioned a possible promotional line, “New York Has a New Hero.” Patterson instantly amended it: “Finally, New York Has a Hero.”

A number of former Little, Brown employees who attended these sorts of meetings with Patterson in the 1990s and early 2000s described him to me as low-key but intimidating, more cutthroat adman than retiring writer — a kind of real-life Don Draper. Unsatisfied with publishing’s informal approach to marketing meetings, Patterson had expected corporate-style presentations, complete with comprehensive market-share data and sales trends. “A lot of authors are just grateful to be published,” Holly Parmelee, Patterson’s publicist from 1992 to 2002, told me several weeks earlier. “Not Jim. His attitude was that we were in business together, and he wanted us both to succeed, but it was not going to be fun and games.”

But that was when Patterson was still making a name for himself and fighting for his publisher’s full attention. Now that he is the world’s bestselling author and Little, Brown’s most prized possession, Patterson seemed agreeable, easygoing. Even when he shot down an idea, like Pietsch’s suggestion that Patterson promote the new Michael Bennett book with a day of events in all five boroughs, he did so gently: “I just don’t want for it to be like one of those things when an athlete goes through and shakes four hands.” Halfway through the meeting, Patterson suggested that they take a short break to listen to some songs from a musical he’s developing based on his romance novel “Sundays at Tiffany’s.”

When the meeting was over, Patterson and his wife drove everyone to lunch in their matching Mercedes sedans. On our way to the restaurant, they took us past their future home, an oceanfront mansion in Palm Beach that they bought last year for $17.4 million and are now in the midst of renovating. “There’s my little cottage,” Patterson said as the 20,000-square-foot house came into view.

ACCORDING TO FORBES magazine, Patterson earned Hachette about $500 million over the last two years. Hachette disputes the accuracy of these numbers but wouldn’t provide me with different ones. Regardless, it seems safe to assume that Patterson, who puts out more best sellers in any given year than many publishing houses, is responsible for a meaningful portion of the company’s annual revenues. “I like to say that Jim is the rock on which we build this company,” David Young told me in his office one recent morning.

Like movie studios, publishing houses have long built their businesses on top of blockbusters. But never in the history of publishing has the blockbuster been so big. Thirty years ago, the industry defined a “hit” novel as a book that sold a couple of hundred thousand copies in hardcover. Today a book isn’t considered a blockbuster unless it sells at least one million copies.

The story of the blockbuster’s explosion is, paradoxically, bound up with that of publishing’s recent troubles. They each began with the wave of consolidation that swept through the industry in the 1980s. Unsatisfied with publishing’s small margins, the new conglomerates that now owned the various publishing houses pressed for bigger best sellers and larger profits. Mass-market fiction had historically been a paperback business, but publishers now put more energy and resources into selling these same books as hardcovers, with their vastly more favorable profit margins. At the same time, large stores like Barnes & Noble and Borders were elbowing out independent booksellers. Their growing dominance of the market gave them the leverage to demand wholesale discounts and charge hefty sums for favorable store placement, forcing publishers to sell still more books. Big-box stores like Costco accelerated the trend by stocking large quantities of books by a small group of authors and offering steep discounts on them. Under pressure from both their parent companies and booksellers, publishers became less and less willing to gamble on undiscovered talent and more inclined to hoard their resources for their most bankable authors. The effect was self-fulfilling. The few books that publishers invested heavily in sold; most of the rest didn’t. And the blockbuster became even bigger.

Patterson has been a beneficiary of the industry’s shifting economics, but he was also a catalyst for change at Little, Brown and in the world of publishing in general. When Patterson published his breakout book, “Along Came a Spider,” in 1993, Little, Brown was still a largely literary house, whose more commercial authors included the historian William Manchester, biographer of Winston Churchill. Patterson’s success in the subsequent years encouraged Little, Brown to fully embrace mass-market fiction. But more than that, Patterson almost single-handedly created a template for the modern blockbuster author.

There were, of course, blockbuster authors before Patterson, among them Mario Puzo, James Michener and Danielle Steel. But never had authors been marketed essentially as consumer goods, paving the way for a small group of writers, from Charlaine Harris to Malcolm Gladwell, to dominate best-seller lists — often with several titles at a time — in the same way that brands like Skippy and Grey Poupon dominate supermarket shelves. “Until the last 15 years or so, the thought that you could mass-merchandise authors had always been resisted,” says Larry Kirshbaum, former C.E.O. of the Time Warner Book Group, which owned Little, Brown until 2006. “Jim was at the forefront of changing that.”

The lesson was not easily learned. Publishing is an inherently conservative business. Patterson repeatedly challenged industry convention, sometimes over the objections of his own publisher. When Little, Brown was preparing to release “Along Came a Spider,” Patterson tried to persuade his publisher that the best way to get the book onto best-seller lists was to advertise aggressively on television. Little, Brown initially balked. Bookstores typically base their stocking decisions on the sales of an author’s previous books, and Patterson’s had not done particularly well. This was going to be the first of several novels about an African-American homicide detective in Washington, D.C., named Alex Cross; the prevailing wisdom was that the audience for a series built around a recurring character needed to be nurtured gradually. What’s more, large-scale TV advertising was rare in publishing, not only because of the prohibitive cost but also for cultural reasons. The thinking was that selling a book as if it were a lawn-care product could very well backfire by turning off potential readers.

Patterson wrote, produced and paid for a commercial himself. It opened with a spider dropping down the screen and closed with a voice-over: “You can stop waiting for the next ‘Silence of the Lambs.’ ” Once Little, Brown saw the ad, it agreed to share the cost of rolling it out over the course of several weeks in three particularly strong thriller markets — New York, Chicago and Washington. “Along Came a Spider” made its debut at No. 9 on the New York Times hardcover best-seller list, ensuring it favorable placement near the entrance of bookstores, probably the single biggest driver of book sales. It rose to No. 2 in paperback and remains Patterson’s most successful book, with more than five million copies in print.

It’s not hard to understand the popularity of “Along Came a Spider.” It’s a police procedural with an uncomplicated yet ever-twisting plot, some sex, betrayal and plenty of violence. The book’s hero, Cross, is smart and tough, yet sensitive and vulnerable. He has a Ph.D. in forensic psychology from Johns Hopkins, lost his wife in a drive-by shooting — leaving him to raise his two children alone — plays Gershwin on a beat-up baby-grand piano and volunteers at the soup kitchen of his local parish. Still, hundreds of suspenseful, fast-paced novels are published each year; few become successful, let alone blockbusters. It’s entirely possible, even quite likely, that without those ads, “Along Came a Spider ” never would have made the best-seller list, and that James Patterson would now be just another thriller writer.

Patterson quickly turned Alex Cross into a booming franchise, encouraging Little, Brown to unify the series with a single jacket style — shiny, with big type and bold, colorful lettering — and titles drawn from nursery rhymes (“Kiss the Girls,” “Pop Goes the Weasel,” “The Big Bad Wolf”), with their foreboding sense of innocence interrupted. “Jim was sensitive to the fact that books carry a kind of elitist persona, and he wanted his books to be enticing to people who might not have done so well in school and were inclined to look at books as a headache,” Kirshbaum says. “He wanted his jackets to say, ‘Buy me, read me, have fun — this isn’t “Moby Dick.” ’ ”

Patterson built his fan following methodically. Instead of simply going to the biggest book-buying markets, he focused his early tours and advertising efforts on cities where his books were selling best: like a politician aspiring to higher office, he was shoring up his base. From there, he began reaching out to a wider audience, often through unconventional means. When sales figures showed that he and John Grisham were running nearly neck and neck on the East Coast but that Grisham had a big lead out West, Patterson set his second thriller series, “The Women’s Murder Club,” about a group of women who solve murder mysteries, in San Francisco.

No sooner had Patterson established himself in the thriller market than he started moving into new genres. Kirshbaum didn’t initially like the idea; he was worried that Patterson would confuse his thriller fans. Patterson’s first nonthriller, “Miracle on the 17th Green,” published in 1996, did very well. That same year, Patterson wanted to try publishing more than one book despite Little, Brown’s view that he would cannibalize his own audience. In addition to “Miracle on the 17th Green,” Patterson published “Hide and Seek” and “Jack and Jill,” each of which was a best seller. From there, Patterson gradually added more titles each year. Not only did more books mean more sales, they also meant greater visibility, ensuring that Patterson’s name would almost always be at the front of bookstores, with the rest of the new releases. Patterson encountered similar resistance when he introduced the idea of using co-authors, which Little, Brown warned would dilute his brand. Once again, the books were best sellers. “Eventually, I stopped fighting him and went along for the ride,” Kirshbaum says.

Patterson’s vision of a limitless empire forced Little, Brown to reorder its priorities. Publishers have finite resources, and the demands of publishing Patterson were extraordinary even for a blockbuster author. Some Little, Brown editors worried that other books were suffering as a result. “To have one writer really start needing, and even demanding, the lion’s share of energy and attention was difficult,” Sarah Crichton, Little, Brown’s publisher from 1996 to 2001, told me. “There were times when some of us resented that. When Jim felt that resentment, he roared back. And he was too powerful to ignore.”

Crichton says she was continually surprised by the success of Patterson’s books. To her, they lacked the nuance and originality of other blockbuster genre writers like Stephen King or Dean Koontz. “Jim felt his ambitions weren’t being taken seriously enough,” Crichton says. “And in retrospect, he was probably right.”

WHEN I VISITED Patterson one day in Florida this fall, his wife met me at the door in tennis whites. Patterson soon followed in a white polo shirt, pleated blue trousers and boat shoes. He stopped in the kitchen to pour himself a glass of orange Fanta and led me upstairs to his home office, an airy, uncluttered wood-paneled room overlooking a lap pool — Sue, who is 10 years his junior, was an all-American swimmer at the University of Wisconsin in the late 1970s — and the Intracoastal Waterway.

Patterson’s bookshelves are evenly divided between thrillers — books by Michael Connelly and Jeffrey Deaver — and more highbrow, literary fare like Philip Roth, John Cheever and Denis Johnson. When I asked him what he was reading now, Patterson mentioned “Wolf Hall,” by Hilary Mantel, the winner of the 2009 Man Booker Prize, and “The Power Broker,” Robert Caro’s doorstop biography of Robert Moses. “My favorite books are very dense ones,” Patterson told me. “I love ‘One Hundred Years of Solitude,’ and I’m a big James Joyce fan — well, at least until ‘Finnegans Wake.’ He kind of lost me there.”

There is no computer in Patterson’s office; he writes in longhand on a legal pad and gives the pages to his assistant to type up. Hanging above the round wooden table where he works is a photograph of President Clinton taken during the Monica Lewinsky scandal walking down the steps of Marine One with a copy of Patterson’s “When the Wind Blows” tucked under his arm. (Patterson’s popularity in Washington is apparently bipartisan: the wall of one of his downstairs bathrooms is plastered with fan mail from both George Bushes.) Neatly arranged on an adjacent L-shaped desk were 23 stacks of paper of varying heights, Patterson’s works in progress.

Patterson grew up in Newburgh, N.Y., the son of a tough man who overcame a difficult childhood. Raised in the local poorhouse by a single mother, Patterson’s father earned a scholarship to Hamilton College and dreamed of becoming a writer or a diplomat but wound up selling insurance. “He didn’t have a father, and I don’t think he knew how to do it,” Patterson told me. (When his father retired, he wrote a novel and showed it to Patterson, already an established author. Patterson gave him the same advice he gives all first-time novelists: Write another one.)

Patterson discovered books late for a man who now makes a fortune writing them. Right after his senior year in high school, his family moved to a suburb of Boston, and Patterson got a job working nights and weekends as an aide at McLean Hospital in Belmont. With nothing else to do on his overnight shifts, he guzzled coffee and read.

At first, Patterson’s literary taste ran toward the highbrow — Jerzy Kosinski, Jean Genet, Evan S. Connell. “I was a snob,” he says. After graduating from Manhattan College in 1969, Patterson was given a free ride to Vanderbilt University’s graduate program in English literature but dropped out after just one year. “I had found two things that I loved, reading and writing,” he told me. “If I became a college professor, I knew I was going to wind up killing them both off.”

Instead, Patterson moved to New York and got a job as a junior copywriter at J. Walter Thompson. He also started reading commercial books like “The Exorcist” and “The Day of the Jackal.” “I always felt I could write a reasonable literary novel, but not a great one,” he says. “Then I thought, I can do this. I understand it, and I like it.” Patterson set up a typewriter on the kitchen table of his small apartment on 100th Street and Manhattan Avenue and wrote after work every night and on weekends. The result was his first novel, “The Thomas Berryman Number.”

More than a dozen publishers rejected Patterson’s manuscript before his agent, whom Patterson found in a newspaper article, finally sold it to Little, Brown for $8,500. “I remember going up to Boston — Little, Brown was still in Boston then — and walking into this library with a huge fireplace,” Patterson recalls of his first visit to his publisher. “On the bookshelves were all of these other Little, Brown books, ‘Catcher in the Rye,’ ‘The French Lieutenant’s Woman,’ ‘The Executioner’s Song.’ I’m thinking, They’re going to publish me? This is so cool.”

“The Thomas Berryman Number” is the story of a newspaperman in Nashville who is assigned to cover the assassination of a local politician and ends up on the trail of his murderer, a professional killer from the Texas panhandle named Thomas Berryman. The action bounces around a lot, ricocheting between Berryman’s various murders, the newspaperman’s reporting and his subsequent effort to turn his articles on the case into a book. “Berryman” bears none of the hallmarks of Patterson’s later thrillers. It’s more brooding and stylized, more classically noir. The bad guy — Berryman — is not a sadist or a psychopathic serial killer; he’s a hired gun. There is no real good guy, other than the reporter and narrator. At its best, the prose can call to mind Raymond Chandler. Here’s Berryman in the book’s opening pages, about to hitch a ride out of Texas with a man he would soon kill: “Thomas Berryman shaded his sunglasses so he could see the approaching car better. A finely made coil of brown dust followed it like a streamer. Buzzards crossed its path, heading east toward Wichita Falls.”

The book won a prestigious Edgar Award for a first novel from the Mystery Writers of America. No doubt, some of those who praised it at the time would now say Patterson has failed to live up to its literary promise. That’s not how Patterson sees it. “It’s more convoluted, more bleak — more of the sort of thing that some people will find praiseworthy,” he says of “The Thomas Berryman Number.” “The sentences are superior to a lot of the stuff I write now, but the story isn’t as good. I’m less interested in sentences now and more interested in stories.”

After “The Thomas Berryman Number,” Patterson wrote several more books for a number of different publishers that were neither successful nor critically acclaimed. In 1980, he tried his hand at the “demonic child” genre — memorably popularized by the film “Rosemary’s Baby”— with the horror novel “Virgin” (which was later retitled and published as “Cradle and All”). In 1987, the year the movie “Wall Street” was released, he published a Wall Street thriller called “Black Market.”

Patterson is unsentimental about his early, somewhat clumsy attempts at popular fiction. “That’s an absolutely horrifying book,” he says of his 1977 novel, “Season of the Machete,” the story of a sadistic husband-and-wife team who carry out a series of gory machete murders on a Caribbean island. “I actually tell people not to read it.”

Several weeks later, I witnessed this firsthand at one of Patterson’s signings. When a woman handed him a copy of the book to autograph, he groaned. “Not my best work,” Patterson said. “It’s scaring me half to death,” the woman answered. “Don’t read it,” Patterson replied.

WHAT IS PERHAPS most remarkable about the Patterson empire is the sheer volume of books it produces. The nine hardcovers a year are really only the beginning. Nearly all of those books are published a second and third time, first as traditional paperbacks, then as pocket-size, mass-market paperbacks. “Scarcely a week goes by when we aren’t publishing something by James Patterson,” Young told me, only half-joking.

This summer, Patterson will begin his fourth thriller series, “Private,” which centers on a detective agency with branches all over the world. In addition, he does frequent thriller one-offs, including an annual summer beach read, usually set at or near a resort.

The thriller genre is generally not for the squeamish, but Patterson’s tend to be especially graphic, and the violence often involves sociopathic sexual perversion and attractive young women. For instance, the villain in his second Alex Cross novel, “Kiss the Girls,” is a psychopath who kidnaps, rapes and tortures college girls in an underground bunker; at one point, he even feeds a live snake into the anus of one of his victims.

As long as there has been mass-market fiction, it has had its detractors. In the late Victorian era, the English poet and cultural critic Matthew Arnold denounced “the tawdry novels which flare in the bookshelves of our railway stations, and which seem designed . . . for people with a low standard of life.” Yet even within the maligned genre, Patterson has some especially nasty critics. The Washington Post’s thriller reviewer, Patrick Anderson, called “Kiss the Girls” “sick, sexist, sadistic and subliterate.” Stephen King has described Patterson as “a terrible writer.”

Patterson has written in just about every genre — science fiction, fantasy, romance, “women’s weepies,” graphic novels, Christmas-themed books. He dabbles in nonfiction as well. In 2008, he published “Against Medical Advice,” a book written from the perspective of the son of a friend who suffers from Tourette’s syndrome, and last year, he took on the supposed murder of the child pharaoh King Tut.

Patterson’s fastest-growing franchise is his young-adult books. He published his first Y.A. title, “Maximum Ride: The Angel Experiment,” in 2005, not long after the languishing genre was jump-started by blockbusters like “Harry Potter” and “Sisterhood of the Traveling Pants.” Last month, he introduced his third Y.A. series, “Witch and Wizard,” a dystopian fantasy about a teenage brother and sister who wake up to discover that they are living in a totalitarian regime and that they have supernatural powers that have made them enemies of the state. Despite some negative prepublication reviews, the book was critic-proof, making its debut at No. 1 on the Times best-seller list for children’s chapter books.

Each of Patterson’s series has its own fan base, but there are also plenty of people who read everything he writes. His books all share stylistic similarities. They are light on atmospherics and heavy on action, conveyed by simple, colloquial sentences. “I don’t believe in showing off,” Patterson says of his writing. “Showing off can get in the way of a good story.”

Patterson’s chapters are very short, which creates a lot of half-blank pages; his books are, in a very literal sense, page-turners. He avoids description, back story and scene setting whenever possible, preferring to hurl readers into the action and establish his characters with a minimum of telegraphic details. The first chapter of “The Swimsuit,” a recent thriller with a villain who abducts women for pornographic snuff films, opens with the kidnapping of a supermodel on a beach in Hawaii:

“Kim McDaniels was barefooted and wearing a blue-and-white-striped Juicy Couture minidress when she was awoken by a thump against her hip, a bruising thump. She opened her eyes in the blackness, as questions broke the surface of her mind.

“Where was she? What the hell was going on?”

TO MAINTAIN HIS frenetic pace of production, Patterson now uses co-authors for nearly all of his books. He is part executive producer, part head writer, setting out the vision for each book or series and then ensuring that his writers stay the course. This kind of collaboration is second nature to Patterson from his advertising days, and it’s certainly common in other creative industries, including television. But writing a novel is not the same thing as coming up with jokes for David Letterman or plotting an episode of “24.” Books, at least in their traditional conception, are the product of one person’s imagination and sensibility, rendered in a singular, unreproducible style and voice. Some novelists have tried using co-authors, usually with limited success. Certainly none have taken collaboration to the level Patterson has, with his five regular co-authors, each one specializing in a different Patterson series or genre. “Duke Ellington said, ‘I need an orchestra, otherwise I wouldn’t know how my music sounds,’ ” Pietsch told me when I asked him about Patterson’s use of collaborators. “Jim created a process and a team that can help him hear how his music sounds.”

The way it usually works, Patterson will write a detailed outline — sometimes as long as 50 pages, triple-spaced — and one of his co-authors will draft the chapters for him to read, revise and, when necessary, rewrite. When he’s first starting to work with a new collaborator, a book will typically require numerous drafts. Over time, the process invariably becomes more efficient. Patterson pays his co-authors out of his own pocket. On the adult side, his collaborators work directly and exclusively with Patterson. On the Y.A. side, they sometimes work with Patterson’s young-adult editor, who decides when pages are ready to be passed along to Patterson.

Some Patterson fans have complained in online forums that his co-written books feel too “cookie cutter” and lack the “roller coaster” feel of his previous work, but his sales certainly haven’t suffered. In at least one instance, Patterson took on a co-author in an effort to boost sales: last year, after noticing he wasn’t selling in Scandinavia, he invited Sweden’s best-selling crime writer, Liza Marklund, to collaborate with him on an international thriller. Their novel, “The Postcard Killers,” is just being published in Sweden and will be out in the U.S. this summer.

For the most part, though, Patterson draws his co-authors from the vast sea of struggling writers. A few weeks after visiting Patterson, I had lunch with one of his collaborators, Michael Ledwidge, in Manhattan. An amiable 39-year-old redhead in a black leather jacket and jeans, Ledwidge told me he grew up in a large, working-class Irish family in the Bronx. He wanted to be a cop, but when he applied in 1993, the Police Academy was oversubscribed. So he worked as a doorman and started writing a heist novel on the side. When Ledwidge learned that he and James Patterson shared an alma mater, Manhattan College, he delivered his half-finished manuscript to Patterson one morning at J. Walter Thompson. That night, his phone rang.

“It must be James Patterson,” Ledwidge joked to his wife.

It was. Patterson helped Ledwidge get his first book published and his writing career started. A few books later, Ledwidge had garnered some critical acclaim but not much commercial success. In 2003, Patterson suggested that they collaborate on “Step on a Crack,” his first Michael Bennett novel. Ledwidge leapt at the opportunity. The book went straight to No. 1 on the Times best-seller list. One book quickly led to another. In 2005, Ledwidge quit his day job as a cable-splicer at Verizon, left the Bronx for Connecticut and became a full-time co-author for James Patterson.

Ledwidge told me that he and Patterson have an easy working relationship, that Patterson playfully teases him when he writes a scene that Patterson doesn’t like and praises him when he’s pleased with something. I asked Ledwidge if he missed writing his own books. “Honestly? ” he asked. “Not at all. This is much more fun.”

ONE NIGHT IN Florida, Patterson and I met his wife and their 11-year-old son, Jack, for dinner at the Palm Beach Grill. When the maître d’ noticed Patterson entering the restaurant, she told him his table was ready. A well-dressed, white-haired woman quickly spun around.

“Are you James Patterson?” she asked excitedly.

“Yes,” Patterson answered.

“I just read your last one. What was it called?”

Patterson hesitated, unsure which book she was talking about.

“It was brutal!” she woman continued.

“ ‘The Swimsuit’?” Patterson ventured.

“Yeah,” the woman said. “Boy, was it brutal! I liked it, but it was brutal!”

After dinner, Sue and Jack went home, and Patterson and I had another glass of wine and continued talking. Patterson told me that Jack, who had been working on his laptop for most of the meal, only recently started to like reading. It required a deliberate effort on Patterson’s part. Beginning a few summers ago, Patterson told Jack he didn’t have to do any chores; he just had to read for an hour or so every day. The first summer Jack resisted. The second summer he didn’t complain. Last summer, he no longer needed any prodding. Patterson ticked off some of the books Jack had recently read and enjoyed — “To Kill a Mockingbird,” “A Wrinkle in Time” and “Huckleberry Finn” — with obvious pride.

Patterson told me that Jack’s initial reluctance to read helped inspire him to move into the Y.A. genre. He wanted to write books for preteens and teenagers that would be fun and easy to read. The young-adult realm was, in one sense, a big leap for an author known for violent thrillers. At the same time, it was a natural fit for Patterson, whose unadorned prose and fast-paced plots are well suited to reluctant readers. Promoting literacy among children has since become a pet cause for him; he has his own Web site, ReadKiddoRead.com, aimed at helping parents choose books for their children. “There are millions of kids who have never read a book that they liked, and that is a national disgrace,” Patterson said. “What I’m trying to do is at least wake up several thousand of them.”

Later, our conversation turned to Patterson’s critics. “Thousands of people don’t like what I do,” Patterson told me, shrugging off his detractors. “Fortunately, millions do.” For all of his commercial success, though, Patterson seemed bothered by the fact that he has not been given his due — that unlike King or even Grisham, who have managed to transcend their genres, he continues to be dismissed as an airport author or, worse, a marketing genius who has cynically maneuvered his way to best-sellerdom by writing remedial novels that pander to the public’s basest instincts. “Caricature assassination,” Patterson called it.

Patterson said too much has been made of his marketing savvy. (A few years ago, a professor at Harvard Business School went so far as to do a case study on him.) To Patterson, the explanation for his success is less complicated. Whether he’s writing about a serial killer, a love affair between a doctor and poet in Martha’s Vineyard or a middle-aged ad executive who miraculously becomes an exceptional putter and joins the senior golf tour, his books are accessible and engaging. “A brand is just a connection between something and a bunch of people,” Patterson told me. “Crest toothpaste: I always used it, it tastes O.K., so I don’t have any particular reason to switch. Here the connection is that James Patterson writes books that bubble along with heroes I can get interested in. That’s it.”

Patterson considers himself as an entertainer, not a man of letters. Still, he bristles when he hears one of his books described as a guilty pleasure: “Why should anyone feel guilty about reading a book?” Patterson said that what he does — coming up with stories that will resonate with a lot of people and rendering them in a readable style — is no different from what King, Grisham and other popular authors do. “I have a saying,” Patterson told me. “If you want to write for yourself, get a diary. If you want to write for a few friends, get a blog. But if you want to write for a lot of people, think about them a little bit. What do they like? What are their needs? A lot of people in this country go through their days numb. They need to be entertained. They need to feel something.”

Shortly before we left the restaurant, Patterson brought up “The Swimsuit” again. “I like ‘The Swimsuit,’ ” he said. “It’s nasty, but I like it. But I think I went a little farther than I needed to. I’m going to tone it down for the paperback.”

Patterson noticed a look of surprise on my face; it’s not every day that an author decides to rewrite one of his books. “Look,” he said, “if you’re writing ‘Crime and Punishment’ or ‘Remembrance of Things Past,’ then you can sit back and go: ‘This is it, this is the book. This is high art. I’m the man, you’re not. The end.’ But I’m not the man, and this is not high art.”

Whatever ambivalence once existed toward Patterson inside Little, Brown has long since been replaced by unequivocal enthusiasm and gratitude. Pietsch, who succeeded Crichton as publisher, says Patterson belongs in the same class as Chandler and Dashiell Hammett. “Every novel of Jim’s is master class in terms of plotting, pace and striking the right balance between action and emotional content,” Pietsch told me. “I have never read a writer who I think is better at keeping your eye moving forward and your heart moving forward.”

Thanks in part to Patterson, Little, Brown’s identity has changed considerably since he first visited the publisher’s former offices in a town house on Beacon Hill in Boston. In addition to Patterson, it is now home to such thriving commercial novelists as Michael Connelly and Stephenie Meyer, author of the wildly popular “Twilight” vampire series, as well as consistent best sellers like Malcolm Gladwell and David Sedaris. In 2008, a year in which many of its competitors were laying off employees and shutting down imprints, Little, Brown gave out Christmas bonuses.

In September, Little, Brown hosted an anniversary dinner in Patterson’s honor — “20 Years of Publishing James Patterson” — in a private room at Daniel, one of the most expensive restaurants in Manhattan. (Patterson left Little, Brown after “The Thomas Berryman Number” but returned in 1989, a few years before “Along Came a Spider,” with a book called “The Midnight Club.”) It wasn’t the sort of party you see often in the world of publishing, particularly now, with much of the industry in free fall. In addition to a meal of crabmeat salad, beef tenderloin and warm madeleines, the 45 guests were given party favors: bottles of red wine with labels that read “Vintage Patterson.”

Days earlier, Hachette Book Group and Patterson’s representative, the Washington lawyer Robert Barnett, hammered out the terms of a new 17-book deal. (Forbes reported that the contract is worth at least $150 million, though Little, Brown and Patterson dispute the number.) “Don’t you need to be home writing?” I joked with Patterson. He told me matter-of-factly that he’d already started 11 of the 17 books, and even finished more than a few of them.

Some toasts accompanied the dinner. Pietsch talked about the conflicting mythology surrounding who actually discovered Patterson. (“Not only did I know the editor who discovered James Patterson, I once ate a hamburger cooked on his grill.”) Patterson’s young-adult editor, Andrea Spooner, recounted her campaign to persuade her father, an English professor, that Patterson was a worthy writer. (“ ‘It’s worth noting, Daddy, that Dickens was one of the most popular and successful storytellers of his time, too!’ ”) When Young told the crowd that Patterson “contributes significantly” to five of Hachette’s six publishing groups, Patterson interjected: “What am I missing?”

“FaithWords,” Young replied, referring to the company’s religious imprint.

“I can do that,” Patterson said.

Patterson was the last to speak. The only man in the room without a tie, he wore a black T-shirt beneath his dark suit. “I’m sorry my good friend Stephen King couldn’t be here,” he began. “It must be bingo night in Bangor.”

Patterson then proceeded to tell one of his favorite stories about his mother’s father, who drove a frozen-foods truck in Upstate New York. During the summer, Patterson said, he would occasionally get up at 4 in the morning to ride along with him. As they drove over a mountain toward his first delivery, Patterson’s grandfather, an irrepressibly joyful man, would be singing at the top of his lungs. “One day he said to me: ‘Jim, I don’t care what you do when you grow up. I don’t care if you drive a truck like I do, or if you become the president. Just remember that when you go over the mountain to work in the morning, you’ve got to be singing,’ ” Patterson went on. “Well, I am.”

It’s no surprise that Patterson loves what he does. What’s not to love? He plays golf most mornings on Donald Trump’s Palm Beach course and spends the rest of the day working on guaranteed best sellers for which he is paid millions.

But the image of Patterson as a carefree man lucky enough to make money doing what he loves is a bit misleading. Patterson is nothing if not relentlessly ambitious. At J. Walter Thompson, he rose from the lowly station of junior copywriter to become the youngest creative director in the firm’s history — along the way dreaming up such ad slogans as “I’m a Toys ‘R’ Us kid” — and then the C.E.O. of the company’s North American operations. And as Patterson is the first to admit, he didn’t even like working in advertising. It goes without saying that writing was never just a hobby for him.

Patterson’s current preoccupation is Hollywood. Despite some attempts, including two Alex Cross films (both starring Morgan Freeman), which Patterson doesn’t think much of, some made-for-TV movies, a failed ABC series and a lot of books that were optioned but never developed, there still hasn’t been a blockbuster film or hit TV show based on one of his novels.

A few years ago, Patterson hired a former colleague from J. Walter Thompson, Steve Bowen, to oversee the development of his various movie and television projects. In 2007, they signed a deal with Avi Arad, the producer of the “Spider-Man” and “X-Men” films, to make a movie based on Patterson’s “Maximum Ride” young-adult series. In addition to trying to make sure that Patterson is more involved in the development process, Patterson and Bowen plan to produce some projects themselves. They have already raised the financing for a new Alex Cross movie that Patterson is helping to write.

When I met Bowen, a good-looking ex-Marine with a trimmed, graying beard, for coffee in Manhattan several weeks after the dinner at Daniel, he told me that part of his challenge is to change Hollywood’s perception of Patterson. He cited Clint Eastwood, whose name was once synonymous with “Dirty Harry” and spaghetti westerns, as a model for the sort of image transformation they are aiming to pull off. “Jim’s been wrongly stereotyped out there as the master of slash and gash,” Bowen said. “What people don’t fully understand is that there’s a unique talent and storytelling ability that has allowed him to do what he’s done in the book world. He just knows what’s going to grab people. The man has a golden gut.”

IN THE MID-1960S, Jacqueline Susann, the author of “Valley of the Dolls” (30 million copies sold), famously demonstrated — via hundreds of bookstore signings — that even blockbuster books are built one reader at a time. When Patterson was still making his name, he, too, barnstormed the country, signing books late into the night and exhausting publicists. These days, though, Patterson doesn’t do many bookstore events. He certainly doesn’t need the publicity, and he would rather be home with Sue and Jack. But on a Monday night in mid-November, he turned up at a car-dealership-size Barnes & Noble in a strip mall on Route 17 in Paramus, N.J., to promote his latest Alex Cross novel, “I, Alex Cross.”

This is Patterson’s 16th Cross book. Since “Along Came a Spider,” Cross has been through a lot. He has had several jobs and a number of ill-fated relationships; he has chased down numerous serial killers, a Russian mobster and a cult of goths; and has even written his own novel based on his late uncle’s investigation of a series of lynchings in Mississippi in the early 1900s.

Patterson came straight from the Newark airport, arriving early to sign the store’s “I, Alex Cross” stock in a back room. “We haven’t seen you in years,” said Dennis Wurst, a Barnes & Noble manager of author promotions who stopped by to say hello.

“How’s business?” Patterson asked.

“It helps when you write an Alex Cross book,” Wurst answered.

A month before, Barnes & Noble was caught in the crossfire of a preholiday pricing war between Wal-Mart and Amazon, with Wal-Mart dropping its prices on several hardcover blockbusters, including “I, Alex Cross,” to $8.99, more than 50 percent off the retail price. The battle set off a panic inside an already-anxious publishing industry: such deep discounting may help move merchandise, but along with trends like the proliferation of e-readers that instantly deliver many blockbusters for $9.99 or less, it further devalues books. The days of $25 hardcovers are surely numbered. Without those revenues, publishers will be even more reluctant to devote shrinking resources to new, unproven authors, which will, in turn, limit the range of books being published.

Whatever the future of publishing may hold, Patterson’s place in it seems secure. By the time he was introduced at the Paramus store, in excess of 300 people — more women than men, but fairly evenly divided, with a handful of children as well — had crowded into the bookstore’s large event space to see him. Stragglers were looking vainly for a spot on the wall to lean up against. Patterson, dressed casually in a sweater and slacks, delivered some brief remarks, took a handful of questions and then got down to the main event — signing books. To avoid a crush of people at the signing table, the staff divided the audience into several groups by letter. They were told that Patterson would autograph any of his books purchased in the Paramus store and one additional title from their own Patterson collection, but that he would not personalize any copies.

The system quickly broke down. Patterson was soon adding names and short inscriptions to books. He bantered easily with his fans as he wrote. Many asked about Jack; more than one wanted to know if he had brought any pictures.

“I skipped work to be here,” one woman said as her husband snapped a picture of her with Patterson.

“That’s always a good thing,” Patterson said.

“Well, I’m a police officer, so I guess that’s bad,” the woman replied.

“I won’t tell,” Patterson said.

There is something unique about the relationship between readers and their favorite authors, a sense of emotional intimacy that doesn’t exist, say, between sports fans and athletes. Patterson’s fans can read him virtually all year. They aren’t just addicted to his books; they see him as a constant companion, a part of their lives. One woman asked Patterson to sign a book for her grandmother, who passed away a few days earlier. “We used to read your books together, and I want to put it in her casket with her,” she said. Another told Patterson that he got her reading again after a recent stroke. A truck driver said that he had never read any of Patterson’s books but that he had listened to every single one of them on the road: “I don’t know what I’d do without them.”

Still another woman gestured at her elderly mother, whom she was pushing in a wheelchair: “She just had heart surgery. You make her happy, and that makes me happy.”

“And that makes me happy,” Patterson said.

After an hour of signing books without interruption, Patterson seemed to be doing fine. “We’re really cooking along here,” he told his publicist. A half-hour later, though, Patterson was starting to tire. “This is getting out of hand,” he said.

After almost two hours, a voice finally came over the loudspeaker: “Will all remaining groups please report to the James Patterson signing area.” Patterson signed his last books, posed for a few photographs with some of the store’s employees and got ready to go. “That was a fairly respectable crowd,” he said as we walked to the escalator.

On our way out, Patterson picked up on a theme he raised with me weeks earlier, during our conversation about his detractors. “This goes to the notion we were talking about in Florida, about my critics — people who call themselves open-minded but then make judgments about what I write,” he said. “Well, these people like it. They’re happy. So what’s the big deal?”

His Spenser Novels Saved Detective Fiction
Tom Nolan

In American popular culture, the private detective is a unique heroic figure: champion of last resort for the vulnerable client, a knight-errant for hire, bringing rough or poetic justice to cases unserved by more official powers that be.

In the past quarter century, it could be said, no writer of private-eye fiction was more popular or prolific than Robert B. Parker, who died Monday at the age of 77. His nearly 40 books involving the no-first-name Boston P.I. Spenser—starting in 1973 with "The Godwulf Manuscript" and ending, it would seem, with "The Professional," published three months ago—made the Massachusetts-born Mr. Parker a best-selling author and a household-name in all homes where mystery fiction was consumed.

Building on aspects developed by illustrious predecessors (aspects he studied as the author of a doctoral dissertation on the private eye in American fiction)—the bantering dialogue of Raymond Chandler, the concern for young people expressed by Ross Macdonald, the swift action of Dashiell Hammett, even the violence of Mickey Spillane—Mr. Parker created a hero and a series of books that revivified the P.I. genre, making it fresh and viable through the end of the 20th century and into the next.

Spenser brought his own quirks and special experience to the traditional private-detective role: He was a good cook and, for the most part, a one-woman man. His closest associate was an African-American "enforcer" with whom he felt much in common. And the self-educated Spenser, like his well-educated creator, was surprisingly well-read—often quoting from the likes of Frost, Auden, Shelley, Shakespeare, and such popular songwriters as Kris Kristofferson and Matt Dennis.

But Spenser's more fundamental nature was informed by that classic mixture of confidence, ability and courage—grace under pressure—that has characterized all American adventurer-investigators from James Fenimore Cooper's day through our own.

The Boston detective also had a rueful, self-deprecating streak to balance his brash self-confidence. Of his presence at a cocktail party of smartly dressed and glamorous young types, the ex-amateur boxer and ex-football player said of his sport-coated self: "I felt like a rhinoceros at a petting-zoo."

Spenser's equally athletic creator sometimes also expressed a similarly endearing side, once telling a roomful of librarians, booksellers and readers: "Please buy my book. I'm too old to get a real job."

But Mr. Parker—whose oeuvre also included series with a small-town sheriff, Jesse Stone, and a woman P.I. named Sunny Randall, as well as a handful of westerns and other novels—of course had a very real job, working five days a week turning out five pages a day. "It's like running a small business," he told fellow writer Stuart Kaminsky, adding: "'Writer's block? That's just another word for 'lazy.'"

"I like to make things," the fictional Spenser told a fictional interviewer in 2007. "I know how to do it." He had good carpentry skills, he said, and could build a house—as could (and had) Mr. Parker. No surprise then that the Spenser books were well-constructed, functional, and comfortable to spend time in.

Spenser himself seemed comfortable in his own skin, and in his own life. Asked "Is there anything you wanted to accomplish that you haven't?" by a Harvard professor in that fictional interview written by Mr. Parker, the private eye answered: "No. I am everything I wanted to be. I've done everything I ever wanted to do. . . . I would be pleased to live this life and do what I do . . . forever. But I have no need to improve on it."

Mr. Parker gave a reader all that was needed. He could set a scene in a few spare sentences and make you see it, as in these lines—from a piece in the recently published anthology, "The Lineup"—that describe a Boston afternoon: "It was one of those days in late June. The temperature was about 78. There were maybe three white clouds in the sky. The quiet breeze that drifted in from the river smelled fresher than I knew it to be." Sense of place, overtones, undertones—the bare essentials, and just a bit more.

He wrote dialogue that at once informed, amused and gave a sense of character; and he conjured characters a reader wanted to spend more time with—especially Spenser, a fixed point in a footloose world, take him or leave him. A pragmatist whose ethics were situational. A tough and decent type who did what needed to be done in the service of a moral cause, affirming the worth of the individual regardless of race, sexual orientation, social status, age or occupation. He made timeless points that need to be remade every generation, in a society ever able to find ways to betray the public and private trust.

The books were addictive, entertaining, amusing—and, in their low-key way, moving. Critics prefer the earliest ones as being more substantive. Readers gobbled up the later ones for their sensibility, tone of voice, and point of view: that wised-up, can-do attitude, with no phonies allowed.

"I'd been in the infantry in Korea and met some pretty bad people," Mr. Parker told Mr. Kaminsky, "but many, maybe most of the people I met in university life were the worst people I'd ever met."

The Spenser chronicles were created to be read in the moment. Time alone knows whether they'll survive their creator. But one sign of how important a writer was to us is how death, in an instant, can turn a name-brand author from taken for granted to one of a kind. Right away, we miss Robert B. Parker.

For the Heirs to Holmes, a Tangled Web
Dave Itzkoff

For a 123-year-old detective, Sherlock Holmes is a surprisingly reliable earner.

Though readers were not always informed of his compensation for, say, uncovering the truth of the Red-Headed League or bringing the Hound of the Baskervilles to heel, Holmes remains a valuable literary property.

His adventures in books, plays, television shows and movies continue to pay dividends for the heirs of his creator, Arthur Conan Doyle. Holmes’s latest appearance on film, directed by Guy Ritchie, has sold more than $311 million in tickets worldwide, and on Sunday won a Golden Globe award for its star, Robert Downey Jr.

At his age, Holmes would logically seem to have entered the public domain. But not only is the character still under copyright in the United States, for nearly 80 years he has also been caught in a web of ownership issues so tangled that Professor Moriarty wouldn’t have wished them upon him.

“It is,” said Jon Lellenberg, the American literary agent for the Arthur Conan Doyle estate, “enough to make lawyers’ eyes roll up in their heads. Even British lawyers.”

After the death of Conan Doyle in 1930, the guardianship of his literary properties was handed down through the three children he had with his second wife, Jean. Their son Denis helped usher Holmes into screen appearances both enduring (the Basil Rathbone films) and ephemeral (a 1954 television series starring Ronald Howard) before his death in 1955. The estate then passed to a younger son, Adrian, who died in 1970, and then to a daughter, also named Jean.

Denis’s widow, Nina, fought for control of the properties and won, purchasing the characters and establishing Baskervilles Investments Ltd., which fell into financial disarray. The Royal Bank of Scotland took receivership of the company and in 1976 sold the Conan Doyle rights; they came under the management of an American producer, Sheldon Reynolds, who made the 1954 “Sherlock Holmes” television series.

Mr. Reynolds did not have much time to exploit the acquisition. In 1980 Sherlock Holmes and Conan Doyle’s other works entered the public domain in Britain. In America the passage of the Copyright Act of 1976 gave an author or his heirs a chance to recapture lost rights; Conan Doyle’s daughter, Jean, did so in 1981.

Jean Conan Doyle, a retired air commandant in the Women’s Royal Air Force, was said to be fiercely loyal to her father’s literary vision, but she seemed to have a whimsical side too. She permitted the licensing of his characters for offbeat films like “Young Sherlock Holmes” (which imagines Holmes and Watson as teenagers) and “Without A Clue” (in which a bumbling Holmes is a patsy employed by a genius Watson).

At her death in 1997, Jean Conan Doyle bequeathed her father’s copyrights to the Royal National Institute of Blind People. The institute sold the rights back to the Doyle heirs, who transferred them into a family-owned company.

In recent years the estate has licensed the characters for mystery collections with Christmas themes (“Holmes for the Holidays”) and supernatural overtones (“Ghosts in Baker Street”). Mr. Lellenberg said a volume of vampire-theme Holmes stories was also being considered.

“Vampires are all the rage these days,” he said. “There’s no end.”

As Holmes has endured, so have challenges over his ownership. In court cases that started in the late 1990s, Andrea Plunket, the ex-wife of Mr. Reynolds, the producer, filed suits against the Conan Doyle estate and other companies, saying they violated her rights to the characters. Her family had financed the purchase of the Conan Doyle properties from the Royal Bank of Scotland, and after she divorced her husband (and became the companion of the socialite Claus von Bülow), she said those rights were hers.
Federal courts have repeatedly ruled against Ms. Plunket, and her attempt to trademark the Sherlock Holmes name was denied. But in a telephone interview, she said she was the administrator of the Sir Arthur Conan Doyle Literary Estate, and that when Jean Conan Doyle’s advisers served Ms. Plunket’s family with a notice of copyright termination, they sent it to a non-existent address.

Ms. Plunket, who now operates a bed-and-breakfast in Livingston Manor, N.Y., said that Mr. Lellenberg and his colleagues were the aggressors. “He has one huge advantage,” she said, “which is the name Conan Doyle, which he brandishes, of course.”

Ms. Plunket said that she had a limited involvement in the making of Mr. Ritchie’s “Sherlock Holmes” film, and that she spoke frequently with its producers and visited its set. “Nobody asked me for my advice,” she said “They didn’t say, ‘Oh, well, Mrs. Plunket, tell us who you want to play Sherlock Holmes.’ I had no legal right.”

Pointing to the legal judgments against Ms. Plunket, Mr. Lellenberg vigorously disputed her arguments. “We’re really tired of her,” he said.

Mr. Lellenberg said Ms. Plunket may still own derivative properties created by Mr. Reynolds, like a Sherlock Holmes series for Polish television. Also, he said, “The studios are vulnerable to harassment, to nuisances, and some people they pay off just to get them out of their way. I don’t know if they did that in this case.”

(A spokeswoman for Warner Brothers, which released Mr. Ritchie’s film, said it had entered into agreements with Mr. Lellenberg’s clients and Ms. Plunket for the movie, but declined to specify the details.)

Mr. Lellenberg said that Sherlock Holmes remains under copyright protection in the United States through 2023, and that any new properties involving the detective “definitely should” be licensed by the Conan Doyle estate. Asked about a recent Red Bull television commercial that features a cartoon Holmes and Watson, Mr. Lellenberg said he had not seen it. “Very interesting,” he said. “News to me.”

The estate remains mum about its plans for the time Sherlock Holmes falls into the American public domain, or whether it might try to extend the copyrights. But Mr. Lellenberg said the group pays careful attention to the management of other venerable pop-cultural properties: the Walt Disney Company, which is preparing to celebrate the 82nd birthday of Mickey Mouse, has “always been at the leading edge” of intellectual property law, he said. And he noted that the estate of Edgar Rice Burroughs, the adventure writer who created Tarzan and John Carter of Mars (each 98), has “generally been the quickest off the mark to ensure and enhance protection for its works and characters.”

There are now nine surviving Conan Doyle heirs, and none is a direct descendant of the author. But Mr. Lellenberg said they all understood the obligation that Holmes represented for their family, particularly for Jean Conan Doyle, who was 17 when her father died.

“She had been old enough to know him well,” Mr. Lellenberg said, “and remembered him writing the last set of stories and reading them to her and her brothers and mother. She also knew the problems of managing an extremely popular literary character. She said that Sherlock Holmes was the Conan Doyle family curse.”

CBS Benches Jack Benny
Michael Starr

So, who's the cheapskate now?

CBS has shelved about 25 recently unearthed episodes of "The Jack Benny Show" -- because it doesn't want the hassle of paying for licensing, etc.

Benny's stock-in-trade was to portray himself as the ultimate skinflint on his TV show, which aired on CBS from 1950-64.

The original episodes, which were assumed to have been lost to time, were discovered in 2008.

The International Jack Benny Fan Club, with the blessing of the Benny estate, approached CBS and offered to pay for the digital transfer and preservation of the rare episodes.

But, according to fan club president Laura Leff, CBS refused to let the episodes out of their vault -- with a CBS exec citing unspecified "issues" thought to be potential musical copyrights, etc. and the costs associated with these elements.

"That's basically the sense I got from [CBS]," Leff told The Post. "That there are so many issues with these shows . . . they don't want to be bothered."

Leff says she believes the roughly 25 "Benny Show" tapes are in the public domain, since they're over 28 years old and weren't copyrighted. "We just want [CBS] to realize they shouldn't be locking away our cultural heritage," Leff said.

As Benny himself might have said, in his famous catchphrase: "Well!"

United States Box Office

Issued Tue Jan 19, 2010
Title/Distributor Wknd. Gross Total Gross # Theaters Last Wk. Days Released
TWENTIETH CENTURY FOX $50306217 $430846514 3422 1 24
WARNER BROS. $16585327 $165153093 3626 2 17
TWENTIETH CENTURY FOX $16566489 $178451165 3641 3 19
LIONSGATE $15146692 $15146692 2523 0 3
UNIVERSAL $11007875 $76370540 2955 4 17
UNIVERSAL $9202815 $9202815 2511 0 3
WARNER BROS. $7531467 $218978376 2880 5 52
PARAMOUNT $7159294 $54801035 2218 6 38
THE WEINSTEIN COMPANY $6888334 $6888334 1873 0 3
WALT DISNEY STUDIOS $4651156 $92546727 2620 7 47
WARNER BROS. $1722246 $33506889 1340 9 31
SUMMIT ENTERTAINMENT $1703809 $290743279 1167 11 52
THE WEINSTEIN COMPANY $1614900 $16837027 1060 10 24
SONY CLASSICS $1550236 $1949366 552 32 17

YouTube to Introduce Limited Film Rental Service
Miguel Helft

YouTube made its long-awaited entry on Wednesday into the business of online movie rentals. But do not expect to be able to stream to your PC the latest Hollywood blockbuster or even a flick from a studio’s dusty catalog of classics.

YouTube, which is owned by Google, is introducing its rental service with just five movies, all from independent filmmakers.

By comparison, Netflix gives its customers the choice of thousands of films, and most cable operators offer their customers large catalogs of on-demand films. More movies will come to the YouTube service later, but the company did not say when or what films it may offer.

Still, YouTube’s decision to dip its toes in online rentals represents a significant, if expected, shift for the online video site. YouTube has thrived by offering an eclectic collection of free video clips and earns most of its revenue from advertising. YouTube already offers some older, full-length movies on its site free.

Last summer, YouTube held discussions with major studios, including Lionsgate Entertainment, Sony and Warner Brothers in an attempt to obtain newer offerings for a planned rental service. In the fall, YouTube conducted a test of the rental service with some content from studios, but the test was available only to Google employees, according to two people with knowledge of the test who spoke on condition of anonymity because they were not authorized to discuss the matter publicly.

YouTube declined to confirm the talks with studios or the test.

A studio executive, who also could not speak publicly, said that Hollywood was always concerned about cannibalizing existing distribution deals. But the executive said that his company would be willing to make some movies available for rental on YouTube on terms similar to those available to services like Apple’s iTunes, Netflix or cable operators.

Some analysts have questioned whether Hollywood movies would appeal to most of the audience at YouTube, which is better known for its broad selection of short clips.

YouTube is unveiling the rental service in conjunction with the start of the Sundance Film Festival. All five films offered for rent on YouTube are part of the festival this year or were shown at the event last year.

“YouTube had a very close relationship with the independent film community since we launched,” said Sara Pollack, entertainment market manager for YouTube. Ms. Pollack said that the number of people watching videos online has grown quickly in recent years and that YouTube wanted “to offer a way for filmmakers to connect with these audiences.”

Ms. Pollack said that only a tiny fraction of the films submitted at Sundance were able to find some form of commercial distribution, and that YouTube would provide a new outlet for independent filmmakers.

The rentals — “The Cove,” “Bass Ackwards,” “One Too Many Mornings,” “Homewrecker” and “Children of Invention” — will cost $3.99 and will be available only from Friday to the end of the film festival on Jan. 31. Renters will pay for the movies using Google’s Checkout online payment service.

Ms. Pollack described the service as “in beta,” programmer’s lingo for products that are still being tested. YouTube said it planned to add other content to the rental service soon, including educational, health and fitness-related videos. It also said it would begin a program called “Filmmakers Wanted” that would allow other independent producers to make their films available to YouTube. Filmmakers will be able to determine the rental price of the movies and would keep the majority of the revenue collected, YouTube said.

YouTube Expands Support for HTML5
Lin Edwards

YouTube is the major video-viewing site on the Internet, and it is constantly working to maintain its edge over competitors such as Hulu, and to present the video-watching experience its users demand. YouTube recently demonstrated an HTML5-based video player, and users have asked it to do more with HTML5. In response, YouTube has now announced that a new experimental video player supporting HTML5 is going live.

According to YouTube, HTML5 is a new web standard rapidly gaining in popularity. It has many new features to provide a rich user experience, such as support for vector-based graphics and animation, geolocation, and drag-and-drop, but the feature of most interest to YouTube viewers is its support for audio and video playback without the need to download an Adobe flash player plug-in for the browser. With no need for a flash player, playback of video and audio are significantly faster.

At present, few browsers currently support HTML5, but YouTube lists Internet Explorer with Chrome Frame installed, Google’s Chrome and Apple’s Safari (version 4+) as being compatible, but other major browsers such as Mozilla Firefox and Opera are not yet compatible. There are other limitations, such as a lack of support in HTML5 for videos with user-created captions, annotations or adverts, and full screen viewing is not yet available, but YouTube says it will soon be expanding the capabilities of the HTML5-compatible player.

If your browser is compatible, you can use the new video player at TestTube, but you will first need to opt-in to the HTML5 program. (If you are already signed on for other experiments at TestTube, you may not get the HTML5 video player.) Another option is to visit Feather Watch, which YouTube promises will give you a faster and even simpler video-viewing experience.

HTML5 is an open standard, and YouTube says it is “very excited” to be getting behind the new web standard and helping to push it forward.

HandBrake Abandons DivX for Ripping DVDs, Should You?

HandBrake - the Swiss army knife of DVD ripping - has ditched support for DivX files. Is it time for you to do the same?

Ask any Mac user what's the best tool for ripping DVDs to your format of choice and they'll almost certainly say the open source wunderkind HandBrake. Actually with the latest 0.9.4 update it's probably the best free tool for converting just about any video file to an Apple-friendly format, alongside the overhauled version of Quicktime in Snow Leopard.

Windows users have a few ripping options at their disposal, although I've always been a fan of DVD Decrypter combined with Auto Gordian Knot if I need DivX files. I tend to rip DVDs as VOB files using AnyDVD HD, which is fine for my media centre but other devices don't always play nicely with VOB files - for example you usually can't access the disc menus.

Now that I've gone to the Mac side of The Force, I find that HandBrake is the best way to rip DVDs onto my Mac, Apple TV or iPhone. HandBrake was ported to Windows a few years ago and is also available for Linux, making it a handy ripping tool for everybody.

HandBrake version 0.9.4
HandBrake's developers made an interesting choice for version 0.9.4 - they ditched support for AVI files using DivX and XviD (an open source equivalent to DivX). Your only option now is to convert DVDs and other media to MKV or MP4 files - with the option to save as Apple-friendly M4V files. If you want to create MPEG-4 XviD files, you'll need to stick with HandBrake 0.9.3.

DivX was the first digital video format to really win mainstream acceptance, doing for movies what MP3 did for music (both good and bad). Eventually even Sony - the king of proprietary formats - caved into pressure and added DivX support to its DVD players and the PlayStation 3.

Why ditch XviD now?
So why is HandBrake ditching AVI and XviD support when it's a format that's won such widespread acceptance? In the words of the developers;

"AVI is a rough beast. It is obsolete. It does not support modern container features like chapters, muxed-in subtitles, variable framerate video, or out of order frame display. Furthermore, HandBrake's AVI muxer is vanilla AVI 1.0 that doesn't even support large files. The code has not been actively maintained since 2005. Keeping it in the library while implementing new features means a very convoluted data pipeline, full of conditionals that make the code more difficult to read and maintain, and make output harder to predict. As such, it is now gone. It is not coming back, and good riddance."

"HandBrake, these days, is almost entirely about H.264 video, aka MPEG-4 Part 10. This makes it rather...superfluous to include two different encoders for an older codec, MPEG-4 Part 2. When choosing between FFmpeg's and XviD's, it came down to a matter of necessity. We need to include libavcodec (FFmpeg) for a bunch of other parts of its API, like decoding. Meanwhile, XviD's build system causes grief (it's the most common support query we get about compiling, after x264's requirement of yasm). Since we mainly use MPEG-4 Part 2 for testing/debugging, and recommend only H.264 for high quality encodes, XviD's undisputed quality edge over FFmpeg's encoder is inconsequential, while FFmpeg's speed edge over XviD is important to us."

Time to ditch DivX?
So there you go, DivX/XviD is gone from HandBrake and it's not coming back. There are other DivX tools around, but is it time to follow HandBrake's lead and ditch DivX? If your devices can handle other formats, the answer is probably yes.

Both the MKV and MP4 formats let you use the H.264 compression codec (known as MPEG-4 Part 10), whereas DivX/XviD files use the older MPEG-4 Part 2 compression codec. As such MKV and MP4 should let you create better looking files that are smaller than their DviX/XviD equivalents. You''ll certainly notice less pixelation in the shadows, for example.

Hardware support
Both MKV and MP4 are becoming increasing popular with device makers, to the point where they are handled by most streaming players and even Network Blu-ray players such as LG's wifi-enabled BD390. If you're a Mac user then M4A is probably the best choice, because it will play on most devices and can be easily imported into iTunes.

HandBrake's M4A iPhone presets (480x272 resolution while maintaining the frame rate) still look very sharp even on an old television, streamed from something like a WD TV Live media player via composite video. If you're looking for entertainment while on the road, especially for kids, you can rip a DVD as a 500-600 MB file that will look great on an iPhone/iPod touch, on your notebook in iTunes or on a hotel television from a WD TV Live.

As an experiment I even watched a few of the movies on my 46 inch Bravia via HDMI and they were surprisingly watchable, obviously helped by the Bravia's excellent upscaling. The picture quality was certainly enough to keep the kids happy for an hour or two.

So I think the time has come to follow HandBrake's advice and part ways with DivX.

Xbox Takes On Cable, Streaming TV Shows and Movies
Brian Stelter

Executives at Microsoft are fond of saying that its subscription gaming service, Xbox Live, should be thought of as a cable channel.

They want Xbox to be seen not merely as a gaming machine for teenagers, but as a media portal for parents and grandparents, too. The company is even producing shows for users: it is in the middle of the second season of “1 vs. 100,” an interactive version of a game show that was on NBC.

The content ambitions do not end there. Microsoft has held in-depth talks with the Walt Disney Company about a programming deal with ESPN, according to people close to the talks, who requested anonymity because the talks were intended to be private.

For a per-subscriber fee, ESPN could provide live streams of sporting events, similar to the ones available through ESPN 360, a service that is available from some high-speed Internet providers. Microsoft could also create some interactive games in association with ESPN, the people said. One of the people said the deal was not imminent. The companies declined to comment.

Already, video game consoles are putting a new emphasis on the video, rather than the game.

The roughly 20 million monthly members of Xbox Live can surf Facebook, browse an online mall of movies and TV episodes and, if they pay, watch Netflix.

“It’s 20 million connected living rooms,” said Marc Whitten, the general manager of Xbox Live.

Similarly, users of the Sony PlayStation can tune into BBC shows and see Weather Channel updates, as well as stream Netflix. Last week, Netflix extended its streaming service to the Nintendo Wii.

Among the many companies that want to transport the on-demand qualities of the Internet into the living room — the over-the-top model, in industry parlance — the console makers have a significant head start. Nearly 60 percent of American homes now have at least one console, according to the consulting firm Deloitte, up from 44 percent three years ago.

“For both of the big guys, it’s about extending the value of the hardware platform,” said Mike McGuire, a vice president for the research firm Gartner, referring to Microsoft and Sony. “The devices are hooked to TVs and have broadband connections, and there are more and more opportunities to license movies and TV shows and deliver them in over-the-top models.”

Microsoft said this month that it had sold 39 million Xbox 360 consoles around the world. About half sign into Xbox Live each month. At that size, “it starts to feel like a cable network,” said Mark Kroese, who oversees Xbox advertising sales for Microsoft. The company does not specify how many members pay for access to premium services like Netflix; basic functions of Xbox Live are free.

The company says it regularly counts more than a million concurrent users — and topped out at 2.2 million at one point during Christmas week last month. That compares favorably to some of the top channels on cable, like TBS and the Cartoon Network, which reach about one million viewers at any given time, according to the Nielsen Company.

The comparisons are crude at best because many of Xbox Live’s users are playing games rather than watching video. No third-party measurement exists, because ratings companies like Nielsen do not yet track the service fully.

But there is no doubt that consoles are expanding their domain, something that is evident in Mr. Whitten’s vision of the service: “The entertainment you want, the people you care about, wherever you are.”

The addition of Netflix in late 2008 was an important step into the entertainment arena for Xbox, and perhaps a precursor to Microsoft’s current talks with Hollywood producers.

Without releasing specific numbers, Mr. Whitten said the streaming movies and TV service were “very, very popular,” including in his own household.

Mr. Whitten said Microsoft wanted to be a bigger player in television and film viewing. He declined to comment on the conversations with Disney but said more than once that “there’s going to be a ton of experimentation around business models and rights.”

“Our goal is, really, how can we get as much content there as possible,” he said.

Disney is not alone in showing an interest in the console market. Many companies sell TV episodes and film rentals through Microsoft’s online store, and Web video ventures are clamoring to have a place on the service.

Console makers have a long way to go to be considered replacements for cable subscriptions, but, at the very least, they could put a dent in the time spent viewing traditional TV.

The interactive game show “1 vs. 100” drew well over 100,000 concurrent users at times during its first season last year, according to Microsoft’s internal data. During the second season, which began in November, two-hour TV-style trivia competitions are scheduled on Tuesday and Friday nights. A voice-over announcer, shown onscreen as an avatar, provides live color commentary.

Like the defunct NBC show, the game has a contestant, “The One,” and a “Mob” of 100 other players. Members of the audience can watch passively or play along, improving their odds of being picked to play for prizes. Unlike on the live-action TV show, every player on Xbox is represented by a cartoonish avatar.

Dave McCarthy, a general manager at Microsoft Game Studios, said the scheduled TV-style shows provided a guarantee that “you’re a part of something bigger.”

Beyond the game show realm, Microsoft also exclusively shows “The Guild,” a sitcom that it bills as “Seinfeld” meets video game culture. It stars its creator, the actress Felicia Day, and is sponsored by Sprint.

For advertisers like Sprint, online communities like Xbox Live are another arena to pursue consumers. Within “1 vs. 100” there are 15- and 30-second commercial breaks like on TV. Those spots account for about 15 percent of the service’s advertising revenue; most of the rest comes from ads on Xbox Live navigation pages, like display ads on Web sites.

In November, Nielsen started to track “1 vs. 100” play and ad views. The pilot program “is the tip of the iceberg,” said Gerardo Guzman, a director for Nielsen Games; eventually, he hopes to generate TV-style ratings.

Mr. Kroese said Xbox advertisers were “very interested in being able to compare the media buy on Xbox to other media buys they do.”

Microsoft says nearly half of Xbox Live members use its entertainment content; the rest mostly play multiplayer games. But it expects that more of its users will try the entertainment side and the line between them will blur further.

“I don’t think there’s a real difference between a game and ‘Lost.’ Or a game and ‘American Idol.’ They’re all ways we spend our leisure time,” Mr. Whitten said.

Over time, he predicted, “these narrow swim lanes — games, music, movies, etc. — will dissolve.”

'Avatar' Pulled from 2-D Screens by Chinese Government

The most successful movie of all time in China is being pulled from the majority of theaters there much sooner than expected.

The communist nation’s state-run movie distributor China Film Group is unexpectedly yanking the James Cameron-directed blockbuster "Avatar" from 1,628 2-D screens this week in favor of a biography of the ancient philosopher Confucius starring Chow-Yun Fat.

Paul Hanneman, co-president of international distribution for the movie’s distributor 20th Century Fox, confirmed the news, which he and other executives at the studio learned Monday evening.

According to a report in the Hong Kong newspaper Apple Daily, the move was made at the urging of propaganda officials who are concerned that "Avatar" is taking too much market share from Chinese films and drawing unwanted attention to the sensitive issue of forced evictions.

Millions of Chinese have been uprooted to make way for high rises and government infrastructure projects. “Nail House” is a popular term given to homes of dwellers who refuse to leave though they are surrounded by demolished homes. In "Avatar," human colonists try to demolish the village of an alien race in order to obtain a precious resource buried below it.

However, David Wolf of Wolf Group Asia, a media consultancy based in Beijing, said the decision to pull "Avatar" had more to do with the upcoming Chinese New Year holiday.

"There's certain windows in the year that are held for domestic films," Wolf said. "We're coming up on Chinese New Year, so this can be expected."

The week-long national holiday, also known as the spring festival, begins the weekend of Feb. 13. China has only 4,000 screens, which places run times at a premium.

Wolf said that most foreign films get a 10-day run before being pulled. Executives at Fox had expected "Avatar" to play much longer, however, due to its massive popularity. It is already the most successful movie of all time in China, having grossed a record $76 million, according to the studio.

Losing the 2-D screens will be a blow to "Avatar," but not a fatal one, a studio executive said. The movie will remain on nearly 900 3-D screens, which have so far generated $49 million, or 64% of its total ticket sales, according to Fox.

It’s not uncommon for China Film Group to protect domestic pictures. In 2006, "The Da Vinci Code" was unexpectedly pulled from theaters there after racking up $13 million in sales.

Foreign movies were also removed from theaters in the run-up to last year’s 60th anniversary of the People’s Republic of China. The sweep was believed to help promote the nationalistic epic, “The Founding of A Republic.”

Only 20 foreign movies per year are allowed to be shown in China's theaters. "Avatar," which opened worldwide in mid-December, was held in Chinese theaters until January because the 2009 quota had already been filled.

Pirated copies of “Avatar” are already available in Beijing’s bootleg DVD stores.

Calls to the China Film Group were not returned.

--Ben Fritz, reporting from Los Angeles. David Pierson, reporting from Beijing.

Evidence Found for Chinese Attack on Google
John Markoff

An American computer security researcher has found what he says he believes is strong evidence of the digital fingerprints of Chinese authors in the software programs used in attacks against Google.

The search engine giant announced last Tuesday that it had suffered a series of Internet break-ins it believed were of Chinese origin. The company’s executives did not, however, detail the evidence leading them to the conclusion that the Chinese government was behind the attacks, beyond stating that e-mail accounts of several Chinese human rights activists had been compromised.

In the week since the announcement, several private computer security companies have made claims supporting Google’s suspicions, but the evidence has remained circumstantial.

Now, by analyzing the software used in the break-ins against Google and dozens of other companies, Joe Stewart, a malware specialist with the SecureWorks, a computer security company based in Atlanta, said he determined the main program used in the attack contained a module based on an unusual algorithm from a Chinese-authored technical paper that has been published exclusively on Chinese-language Web sites.

The malware at the heart of Google attack is described by researchers as a “Trojan horse” that is intended to open a back door to a computer on the Internet. Called Hydraq by the computer security research community, and intended to subvert computers that run different versions of the Windows operating system, the program was first noticed earlier this year.

Mr. Stewart describes himself as a “reverse engineer,” one of a relatively small group of software engineers who disassemble malware codes in an effort to better understand the nature of the attacks that have been introduced by the computer underground, and now possibly by governments as well.

“If you look at the code in a debugger you see patterns that jump out at you,” he said. In this case he discovered software code that represented an unusual algorithm, or formula, intended for error-checking transmitted data.

He acknowledged that he could not completely rule out the possibility that the clue had been placed in the program intentionally by programmers from another government intent on framing the Chinese, but said that this was unlikely.

“Occam’s Razor suggests that the simplest explanation is probably the best one,” he said.

Tech Group to Launch Digital Music File Successor
Kate Holton and Matt Cowan

A leading technology company is set to launch a new digital music file format which will embed additional content for fans including lyrics, news updates and images in what could be a successor to the ubiquitous MP3 file.

The music industry has been hammered by piracy in the last decade and is looking to develop new offerings to entice consumers to buy their music from legitimate sites, instead of taking it from illegal outlets.

The new proposal, which is called MusicDNA and has the backing of the original MP3 digital music file inventor, would allow fans to download an MP3 file on to their computer, which would carry with it additional content.

Music labels, bands or retailers could then also send updates to the music file every time they have something new to announce such as the dates of future tours, new interviews or updates to social network pages.

The user would receive as little or as much of the information as they want, every time they are online. However anyone who downloads the music file illegally would receive only a static file which would not receive any updates.

BACH Technology, the group behind the MusicDNA file, says it is looking to partner with retailers, music labels, rights holders and technology companies and is happy to provide its technology for others who could use it under their own brand.

BACH is based in Norway, Germany and China and has Germany's Fraunhofer Institute for Digital Media Technology as a partner.

"We are getting very good feedback and the fact we are looking to include everyone in this, and not competing against them, helps," Chief Executive Stefan Kohlmeyer told Reuters.

The music files can play on any MP3 player including Apple's iPod. The music player, or online music library, can also be adapted to suit the user and could, for example, be integrated into existing social networks.

Kohlmeyer said the service would hark back to the time when music fans enjoyed looking at the lyrics and artwork on an album almost as much as they enjoyed listening to the music itself.

"What we are bringing back to the end user is the entire emotional experience of music," he said. "We think it got lost in the transition to the digital era.

"We think a beautiful piece of audio has been reduced to a number code. We want to enrich it again."

BACH, which counts the inventor of the MP3 and a former chief executive of Sony Music Entertainment among its investors, is also hoping that software developers will create new applications and content for the MusicDNA player.

A beta version of the file will be available in the Spring and a full commercial rollout is expected by the summer. It also hopes to roll out a mobile version of the music player.

BACH has already signed up a host of partners across the industry and is in talks with the major record labels.

Rob Wells, the senior vice president of digital at Universal Music Group International, told Reuters he thought the new offering was exciting and said Universal could quite possibly work with the company, but said they still needed further commercial conversations.

"I think the music industry has got a great opportunity to open up completely new revenue streams," Kohlmeyer said. "They haven't contemplated in the past all the aspects of rich media."

(Reporting by Kate Holton; Editing by Rupert Winchester )

Digital Music Gains, but Can't Offset Low CD Sales
Eric Pfanner

Sales of digital music rose 12 percent worldwide last year, but that growth was insufficient to compensate for plunging revenue from compact discs, the music industry’s international trade organization said Thursday.

The group, the International Federation of the Phonographic Industry, used the publication of the figures as an opportunity to renew its calls for a tougher crackdown on digital piracy, which it blames for a 30 percent decline in global music sales from 2004 to 2009.

“We’re all fed up talking about piracy, it’s boring talking about piracy, but it is the problem and we can’t avoid it,” said John Kennedy, chief executive of the trade group.

Critics say music companies have been too slow to embrace new online business models that are attractive enough to lure music fans away from pirate sites.

Over the past year, however, digital streaming services like Spotify, which offer free listening, supported by advertising or subscriptions, have gained a growing following. Revenue from streaming is accelerating, as growth in sales of digital downloads from services like Apple’s iTunes slows.

Over all, sales via the Internet, mobile phones and other digital methods totaled $4.2 billion in 2009 and accounted for 27 percent of music industry revenue, up from 21 percent a year earlier, the trade group said.

But with sales of CDs declining by double-digit percentages, Mr. Kennedy said the record companies’ overall global revenue for 2009 would fall 8 percent or 9 percent from 2008.

Mr. Kennedy said the decline in sales, which has persisted for nearly a decade since a 2001 peak in revenue, was hurting the development of local artists in a number of markets hit hard by piracy. In France, for example, signings of new artists by record labels fell by more than 60 percent from 2002 to 2008.

“Sadly, today we are not at the turning point in the music industry,” Mr. Kennedy said. “I still hope that in a few years’ time, that point will come.”

Music Biz: Piracy Our "Climate Change," Governments Must Act!
Nate Anderson

The global music industry trade group IFPI has released its Digital Music Report 2010, a 30-page document that makes a single argument: copyright infringement is a form of "climate change" for creative industries, and "we look to governments for action."

According to this view of the world, the music business has now tried its hand at being "innovative" and "customer focused." It disaggregated albums, it allowed music to go up on everything from Amazon to iTunes to Spotify to Last.fm. It sued users, it launched education campaigns. Nothing worked. It's now time for governments to step up.

We've got numbers

The report trots out a host of statistics to make its point. The music business is 30 percent smaller than it was in 2004, and is off by even more than that in countries like Spain. At the same time, though, digital single sales grew by 10 percent in 2009 and digital album sales grew by 20 percent.

One obvious explanation for this trend might be that people aren't buying (more expensive) CDs but are buying (much cheaper) digital singles. This factor alone must surely account for a pretty sizeable percentage of the 30 percent decline in music industry revenues, but it's mentioned in only a single sentence. When digital downloads account for 40 percent of the total US music market, you might expect that the economic implications of this shift would be more prominent. But you'd be wrong.

That's because the decline is due to piracy (and "piracy" is the preferred term in the report, sometimes varied by a reference to "digital piracy"). IFPI admits that only 15 percent of European Internet users even engage in piracy at all, and it further admits that many of these users purchase music, but it still claims that piracy is the "fundamental problem."

Certainly, it is a real problem—in Spain, one-third of Internet users infringe copyrights and revenues have fallen to one-third of their 2004 levels. The report's more interesting moments are the testimonials from working artists. (The quotes from music execs about "extracting" money from "consumers" are... less compelling.)

For instance, Teemu Brunila of Finnish band The Crash rails against critics who argue that concert revenues should just make up for recorded music sales. "90 per cent of our yearly income as a band came from copyright channels, not live, despite the band touring 20 countries," he said. "Make no mistake, in a world with no copyright protection, freedom of information will become freedom from information because no one will do a damn thing creatively...

"One year the band played Valmiera, the biggest music festival in Latvia. We drove in from the airport and heard our songs on the radio. We headlined the festival and the 10,000-strong crowd roared out our songs. When we came off stage I asked our label representative how many records we had sold in Latvia. The answer was like a slap in the face. 200."

The report is also interesting for its willingness to at last admit the existence of more complicated arguments. For instance, the report now accepts the "obvious fact" that "some file-sharers are often also buyers of music." It recognizes the need for "good legitimate music offerings." It mentions the question of live revenues (which are booming). It talks a lot about the need for "proportionality" in responding to the threat.

In the end, the solution is the expected one: graduated response policies across the globe, backed by governments, with real sanctions and the threat of disconnection.

Is this really the solution? We'll find out more this year as experiments like France's HADOPI three-strikes regime come online, but there's reason to think such a harsh response isn't the only way to achieve a better result. (Imagine all you do on the Internet, then imagine having that access cut off because your rebellious teenage daughter kept downloading boy band tracks. Proportional? Hardly.)

IFPI struggles to make sense of Sweden, which saw big growth in digital in 2009 and also saw growth in physical CD sales—which is unheard of. But Sweden has no graduated response law. What it does have is an implementation of the EU's IPRED directive, which went into effect this year but only affected Internet traffic levels for a few months.

The answer is probably a combination of factors involving the huge success of Sweden-based Spotify, the Pirate Bay trial in early 2009, and the IPRED law. IFPI insists that the effect won't last unless a three-strikes law is passed, but it's of course impossible to know.

In any event, the "three strikes" mantra means relatively little in the grand scheme when the world's largest music market, the US, isn't even entertaining the idea. The government hasn't considered it, and ISPs refuse to implement it voluntarily. The music biz has tried to use the current FCC net neutrality rulemaking to get the FCC involved in "encouraging" ISPs to act against their users, but that seems unlikely to happen.

Yet the US market also has an astonishingly high rate of digital music sales, which now account for 40 percent of RIAA member revenues.

Of course, "three strikes" would be even better if it could be cut back by a couple of strikes. As the report notes with apparent approval (and a hint of longing for such a controlled, closed ecosystem), "Microsoft spoke out against piracy, ready to ban players from Xbox live if they had modified their consoles to play pirated discs—no three strikes procedure needed!"

As for what's selling, these are the major labels, so the top 10 singles are pretty execrable stuff unless you like Lady Gaga, Britney Spears, or songs with titles like "Kiss Me Thru the Phone" and "Boom Boom Pow."

Pirates Are The Music Industry’s Most Valuable Customers

Once again the music industry has come out with disappointing results for physical music sales, which they blame entirely on file-sharing. What they failed to mention though, is that their findings show that music pirates are buying more digital music than the average music consumer. Since digital music is the future, pirates are the industry’s most valuable customers.

Have you ever heard one of the major movie studios complaining about the decrease in sales of VHS tapes? We haven’t. The music industry on the other hand continues to blame the decrease in physical sales on digital piracy, ignoring the fact that there’s a generation growing up that has never owned a physical CD.

Yesterday the music industry lobby group IFPI presented its 2009 figures, again putting the blame for decreased physical sales on file-sharers. Unfortunately, most mainstream media outlets simply reposted the IFPI press release and their flawed analysis. In general, no effort is made to actually balance out or check the message being sent out to millions of readers.

In their annual Digital Music Report, IFPI states that file-sharers are half as likely to buy physical CDs than the average music buyer. Although the report is about digital music, they carefully avoid saying anything about file-sharers and digital sales. That would actually show a completely different picture as we will explain below.

The music group made this statement based on an IFPI-commissioned study that was executed by Jupiter research. Although IFPI refused to share the entire research report with TorrentFreak, we can conclude the following from the two pages that were published online.

Compared to music buyers, music sharers (pirates) are…

• 31% more likely to buy single tracks online.
• 33% more likely to buy music albums online.
• 100% more likely to pay for music subscription services.
• 60% more likely to pay for music on mobile phone.

These figures (as reported by the music industry) clearly show that file-sharers buy more digital music than the average music buyer. In fact, the group that makes up the music buyers category actually includes the buying file-sharers, so the difference between music sharers and non-sharing music buyers would be even more pronounced.

How can this be true and why was there no mention of this in the Digital Music Report? They must be spending less on digital music then, right? But again, this is not the case at all. On average, file-sharers actually spend more than non-sharing music buyers. At least that’s what Mark Mulligan, Vice President and Research Director at Forrester Research who conducted the study for IFPI told us.

Mulligan has his hands tied and couldn’t say much about the findings without IFPI’s approval, but we managed to get confirmation that paying file-sharers are the music industry’s best customers. “A significant share of music buyers are file sharers also. These music buyers tend to be higher spending music buyers,” Mulligan told TorrentFreak.

So why do file-sharers download music without paying? According to the annual IFPI report, one of the main reasons people share music is because it’s free. This leads the music industry group to conclude that they are cheapskates and not willing to pay for music at all. But, as the above clearly shows, they are misinterpreting this finding, and we’d like to explain why.

In the digital age, people’s demand for music has changed significantly, but their budgets are still limited. The average file-sharer is currently spending $100 a year on music according to IFPI’s own research, not really a group that can be classified as freeloaders. However, their demand for music simply exceeds their budget and that’s where they start downloading music on file-sharing sites, because it’s free.

Just to be clear on our motivation to balance the ‘facts’ as reported by IFPI. We are not advocating that all music should be free and neither do most of the music lovers who share files online. However, the music industry continues to ignore that file-sharing is much more of a signal from the market that it is the increased demand for music that fuels piracy.

The solution to the problem is relatively easy. Start offering more unlimited and unrestricted music services and piracy will go into a free-fall. File-sharers are already paying for digital music, and they pay more than the average music consumer. File-sharing is simply a market signal showing that there is a need to compensate for the lack of high quality and affordable subscription services.

If anything, the music industry should have more respect for file-sharers, as they are their most valuable consumers. They are ahead of the curve and actually leading the way for the future of digital music, buying more digital music than anyone else. It’s the music industry that has to change, not the other way around.

Fifty Employees Cut At Universal Music Group

As rumored, Universal Music Group has laid off approximately 50 employees throughout the company. Anonymous sources confirmed the cutbacks to the Los Angeles Times today.The 50 employees let go make up less than one percent of UMG's workforce. The cuts were made across UMG's multiple labels, as well as the UMG Distribution division.

A spokesperson for the label told the Times that UMG is "continuing to transform our organization to better serve our artists and business partners. Given the current economic climate, we have to be as agile and efficient as possible. Unfortunately, these ongoing efforts have resulted in some redundancy. However, UMG will now be even better positioned to compete in the growing global, digital marketplace."

The Times notes that even though Universal was the market leader once again in 2009, it is not immune to the fiscal worries of the music industry. Last week, Nielsen reported that UMG held just over 30 percent of the total music sales market last year.

As reported yesterday, Lost Highway VP/Promotion Ray DiPietro has exited as part of the cuts at UMG. DiPietro will launch his own radio promotion, artist management and artist development company, called Bitter Little Dutchboy LLC. You can contact DiPietro and BLD at (917) 572-7666 or raybld99@gmail.com.

EMI Licenses Songs to New Ad-Supported Site
Greg Sandoval

EMI Music has licensed music to ad-supported music service FreeAllMusic.com, becoming the second major label to partner with the start-up.

FreeAllMusic.com, which made the announcement Tuesday, is the latest company to support the offering of free songs to the public with ad sales. Most of the companies that have attempted this have failed, including SpiralFrog, Imeem, and Ruckus.

It must be noted that Pandora, an ad-supported music company, has recently logged a profitable quarter.

That said, FreeAllMusic is no Pandora. The company's business model more closely resembles SpiralFrog's, which also gave away downloads. SpiralFrog's songs, however, were wrapped in digital rights management.

According to a press release, FreeAllMusic says it will give users DRM-free MP3s that are paid for by advertisers. The only catch is that users must agree to watch "one brief video commercial" per download.

On the face of it, it doesn't sound like a bad consumer experience. Once a user watches an ad for a song, they don't need to watch another ever again.

For a while now, most ad-supported music services can't make enough from ads to cover the cost of music. Why would any advertiser give away music--which is certainly not being given away by the big recording companies--and pay large advertising rates for a one-time ad?

We've seen how tough it is to make high enough ad rates when services can advertise to users multiple times. I'm kind of shocked anyone would try this kind of model so soon after SpiralFrog's demise.

6 iPhone Internet Radio Apps For Every Type Of Listener
Nancy Messieh

iPhoneRadioWhen it comes to combining the iPhone and Internet radio, it can be a daunting task, considering how many apps there are to choose from. We’ve put together a list for you, that might make the choice a bit easier, depending on what kind of listener you are.

iPhone and Internet Radio – Want Variety?

If you’re looking for a big variety of radio stations to choose from, then CBS Radio will meet your needs. Almost identical to the Yahoo! Music App, the CBS Radio app features the widest variety of genres and radio stations, from both AOL Radio, Yahoo! Music as well as local stations from almost 30 cities across the US.

The CBS Radio app allows you to add stations to favourites as you are listening to them, by clicking on the star icon. When a song is playing, the title, singer, and album artwork are displayed. You can skip up to 6 songs per hour while listening to any given radio station.

Other features include sharing the radio station you are listening to by sending your friends form emails with a link to the radio station, or buying the currently playing song on iTunes.

Your listening is interrupted every now and then by several audio adverts in a row.

Want To Discover New Music?

If you want to discover new music based on your taste, or listen to user-generated playlists, you should download FineTune.

The app requires registration on FineTune’s website, but that certainly has its advantages. You can create your own playlists on the FineTune website, clunky as it may be, and then easily access them from your iPhone.

You can also use FineTune to discover new music by listening to Artist Radio stations. Choose one specific singer or band, and FineTune will play similar music for you. You can add artists to your favourites on the FineTune website but that feature is lacking on the iPhone app. The variety of pre-set radio stations on FineTune is limited to the standard genres, but they are listed under some pretty cheesy names.

If you’re not sure what to listen to, FineTune has a list of Featured Artists, from mainstream to obscure, from the 50s to present day, along with a list of the popular artists on FineTune.

The Now Playing window displays the names of the song and singer, the album title and album artwork. While listening to any given radio station you can skip up to 5 songs per hour.

Want A Specific Station?

Do you have a specific radio station that you want to listen to? Then use FStream.

As long as you have the URL used to access the online radio station using an external desktop app like Winamp or iTunes, FStream can play that station for you on your iPhone. Adding radio stations can be done directly through the app, but is easier done using their web management tool.

No registration is required, as the app makes use of your iPhone’s IP address. Web management can be accessed by clicking on the ‘More’ tab, where FStream will give you the the link to go to for managing your favourite stations, and the choice to use password protection.

iphone and internet radio

When adding a station to your favourites, there is a space to fill in the format and bitrate, but it is not necessary to fill that information in. The now playing tab displays the song title and singer.

A unique feature that sets FStream apart from the rest is the ability to record the audio in either WAV or AIFF format. You can play recordings on your iPhone or download them through your FStream web management page.

Want Podcasts?

Want to listen to podcasts on the fly? Use Stitcher Radio.

Stitcher allows you to tune into the latest podcasts from around the web, from news and business to science and technology, as well as live public radio stations from around the US. You can add podcast episodes to your favourites or bookmark podcast episodes while they are playing.

The latter seems to be a little bit redundant taking into consideration the favourites feature. Using the favourites feature is more beneficial, as you can receive email alerts once a new episode has been added.

Each category consists of a playlist of the latest episodes from various popular podcasts. Once a podcast episode has finished, Stitcher will automatically start playing the next episode on the list, which means, for example, you can listen to the latest news podcasts from NPR, CNN, Fox, and Slate, to name a few, all in one playlist.

You can also pause podcasts or skip to the next episode in the playlist, as well as rewind and fast forward within a podcast, but you have to use the seeker, so it’s not entirely accurate. If you close Stitcher while listening to a podcast, opening it up again will take you back to the exact spot where you left off in the episode.

You can also sync your mobile listening with your desktop experience, listening to podcasts both on the go, or at your computer on their website. Stitcher also features social integration, where you can share the name and link to the podcast episode you are listening to on Twitter, Facebook or by email, and users don’t need to be registered members to tune in.

A good way to familiarise yourself with the many features that Stitcher has to offer is to listen to their very own Tips podcast, which can be found under the Featured Podcasts.

Stitcher requires registration, and has unobtrusive ads at the bottom of the screen.

Want To Multi-Task?

Want to multitask on your phone while listening to the radio? Download iRadioSuite

iRadioSuite has many features you wouldn’t expect to find in a free app. The list of genres consists of 80s music, Alternative, Rock, Country, Christmas tunes, Soft Rock and office friendly music, and Top 40 songs.

While a song is playing, iRadioSuite allows you to pause the music, and rewind up to 10 minutes on any station. While a song is playing, you can add the station to your favourites, visit the station’s website in an integrated browser, and buy the song on iTunes, tag it, or send the track info by email. Emailing track information opens up the mail app, with the singer and song title filled into the body of the email.

The Now Playing window displays the song title, singer, and the station’s logo.

What makes iRadioSuite an exceptional app is its ability to play radio stations in the background. While listening to a station, click on the button marked ‘background play,’ and when prompted it will open a window in Safari. The music will fade out, and back in again, and once you’ve hit the home button, you can multitask on your iphone, while the music plays, to your hearts content.

If you want to stop the music, simply open up the app again.

For all of its features, iRadioSuite is surprisingly and blissfully ad-free.

Want To Create A Playlist?

Want to listen to a specific song on the go? Download Boombox.

Boombox’s interface is designed like, well a boombox, and is built on the framework of social music website, Blip.fm. Using the free version of Boombox allows you to search for and listen to songs on your iPhone, as well as, create playlists, unlike FineTune which only allows you to create playlists at your computer. You can create local playlists to listen to on your iPhone, but if you want direct integration with your Blip.fm account, you will have to purchase the paid app.

Searching for a song gives you the option to buy it on iTunes, add it to your playlist, or listen to it immediately. You can only create one playlist at a time. The playlist can be edited by clicking on the list icon in the top right hand corner of the screen.

Do you have a favourite iPhone radio app? If so, let us know about it in the comments.

10 Best Alternatives to the iTunes Store
Adam Berenstain

The iTunes Store changed how we buy music, but it's not the only option. We look at how nine other MP3 stores stack up to discover if anything can actually replace it.

Buying music has always involved tough decisions. Rolling Stones or Beatles? CD or LP? The mall or the indie record store with the cute cashier? These questions have plagued music fans for decades, but the iTunes Store changed everything. Thanks to its convenience, huge catalog, and iPod-friendliness, iTunes now sells more music in the United States than any other retailer, either online or brick-and-mortar. But choices remain. iTunes competitors have sprung up all over the Internet, clamoring for your dollars.

Some compete directly with the iTunes megastore model, while others cater to customers with specific tastes. Each sells high-quality MP3 files that play on Macs and iPods, but they supply them in different bit rates (a measure of data that helps determine sound quality) and from catalogs of varying sizes. We’ve compared nine top iTunes competitors to see which most deserve your time and money. After all, freedom of choice is music to a Mac user’s ears.

Rhapsody MP3

Baffled buyer beware: It's hard to find what you're looking for.

Prices, check. Selection, check. Searching...not so much.

From search results that can’t be sorted to a design that dribbles albums and track names across endless pages dotted with tiny cover art, the Rhapsody MP3 store (mp3.rhapsody.com) seems designed to frustrate. But the selection is good--if you can find what you’re looking for--and prices aren’t bad. Rhapsody offers over 6 million songs in 256kbps (kilobits per second) DRM-free MP3 format for $0.99 or $1.29 each. Most albums start at $9.99 and may be as much as $2 cheaper than the same offerings in iTunes.

Unlike iTunes, downloaded music is bundled in ZIP files thanks to lack of a Mac-native download manager, and you’ll have to do fair amount of digging around if you want to buy a gift card. Rhapsody’s full-length previews are great for trying those songs before you buy, but you get only 25 previews each month without paying up to $12.99 monthly for Rhapsody Unlimited, a plan that lets you stream the store’s entire catalog. Considering Rhapsody’s limitations, we have a plan of our own: We’ll pass.

Walmart MP3 Music Downloads

Predictably low prices on a predictably mainstream selection.

Walmart's store is small and thoughtfully laid out, but you'll spend too much time in the checkout line.

Walmart is all about cheap stuff, so the low prices at its MP3 Music Downloads store (mp3.walmart.com) come as no surprise. DRM-free MP3s (most encoded at 256kpbs, some at 192kbps) cost $0.64, $0.94, or $1.24 each, and most albums start at $8.99. You can even browse all tracks at a specific price, a nice touch that iTunes should consider. Just don’t plan to hunt Walmart’s 2 million–strong catalog for obscure tunes or unusual genres--it has the latest hits, standard classics, and little else. (Fans of the well-represented country and gospel genres will fare better, though.)

Shopping is a pleasure, thanks to a clear, uncluttered layout filled with eye-catching album art. The sub-site Soundcheck offers exclusive EPs and streaming video of performances by popular artists. And just like iTunes, you can email friends gift certificates, or you can upgrade songs to the full album they came from for a few extra bucks. But without a Mac OS X version of Walmart’s MP3 Music Downloads Manager, buying tracks is a chore we can’t recommend. Mac users are forced to download all songs they buy individually, even if they’re part of a complete album. Guess we’ll pick up that 60-song Sinatra boxed set someplace else.


British invasion offers low-priced MP3 and AAC files.

Decent selection plus good prices add up to 7.

The 7digital music store (us.7digital.com) has hopped the pond from England, bringing a right proper catalog of more than 6 million tracks. Most are DRM-free MP3 files encoded at 320, 256, and 192kbps, and some are similarly encoded AAC files. The store features an eclectic mix of old and new material, focusing on recent hits and the best of underground hip-hop and alternative music. However, we found the occasional odd hole in our favorite artists’ catalogs, and too many compilation albums and songs are credited to “Various Artists,” making searches frustrating.

We like 7digital’s Locker feature, which lets you easily re-download previous purchases, but we’d love to have a Mac version of the store’s Download Manager app, instead of having to muck about downloading ZIP files of our tunes. These hiccups aside, browsing and gifting songs and albums in 7digital is easy. Better still, its prices are easy on the wallet. Songs set you back $0.77 to $0.99 to $1.29 apiece--most are only $0.77. And albums cost between $4.77 and $9.99, with many costing just $7.77. If you’re a bargain hunter (and really, who isn’t?), 7digital is a bloody good show.


High class and high fidelity--with one monthly catch.

eMusic's layout is more magazine than music store, and it works.

Is this a store or a sanctuary? While other sites seem content to merely sell you songs, eMusic’s emphasis on discovering new music offers an ongoing experience. Aimed at a sophisticated audience with eclectic tastes, eMusic (www.emusic.com) incorporates both links to artists’ Wikipedia pages and embedded YouTube videos into an elegant design that makes it simple to browse its 6 million tracks and thousands of audiobooks. And classical fans will appreciate front-and-center options to search by composer or conductor.

What’s the catch? eMusic requires you sign up for monthly subscription plans that cost $11.99, $15.89, or $20.79, allowing 24, 35, and 50 song downloads, respectively, per month. Separate audiobook-specific plans get you one book credit a month for $9.99 or two for $19.99 (most books cost one credit). Gift subscriptions are also available, and eMusic’s files--DRM-free variable bit rate MP3s, most with an average bit rate of 256kbps--remain yours even after you cancel your monthly plan. eMusic’s offerings may not be for everyone, but being part of a small community that cares about quality and good taste doesn’t sound bad to us. After all, we use Macs.

Amazon MP3

The 9 million-song gorilla gives iTunes a run for its money.

Cluttered? Sure... cluttered with bargains, that is!

With more than 9 million tracks, Amazon MP3 (www.amazon.com/mp3-music-download) probably has what you’re looking for when the urge to shop strikes. If only finding music was more streamlined. The site’s busy design looks and feels more like a clunky database than a music store, though the sorting options that appear in search results help keep things moving. Songs--variable bit rate, DRM-free MP3 files with average bit rates of 256kbps--start at $0.89 and rise to $0.99 and $1.29, much like iTunes. Unlike iTunes, most albums hover between $5.99 and $9.99, and frequent specials drive prices even lower. Many albums on iTunes (if not most) can be found cheaper on Amazon MP3. Downloading them is made easy by the Amazon MP3 Downloader, a Mac-native application that can export tracks to iTunes when the shopping is done. Gifting is available through Amazon’s easily emailed cards, and all told, price and selection make Amazon MP3 hugely worthwhile.


The former king of pirated tracks now offers legal songs... but forgot the price tags.

Napster's lack of prices squelches our urge to shop.

After shedding its image as a file-sharing troublemaker, Napster (www.napster.com) next abandoned its diehard adherence to subscription-only music sales to offer Napster Light, which offers à la carte DRM-free MP3 downloads encoded at 256kbps (some at 128kbps). Like Rhapsody, Napster steers you toward plans that start at $7 a month and allow unlimited streaming of its music videos, Internet radio stations, and more than 8 million songs. These plans are optional if all you want to do is buy MP3s, but because their extra features aren’t fully unlocked until you pony up for a plan, Napster feels like half a store if you’re not paying monthly. Selling MP3s seems like an afterthought, and nothing says that more than Napster’s lack of prices.

No, really--Napster doesn’t display album or song prices. Incredibly, you have to mouse over a tiny icon to learn how much an album costs (most are $9.95), and song prices are simply unavailable until you buy one (they’re $.99 or $1.29). We’re all for keeping things simple, but Napster’s solution stinks. Do we need to mention that the lack of an OS X–native download manager forces Mac users to download one track at a time, or that its text-heavy store design feels chilly and soulless? Didn’t think so.

Amie Street

Indie tracks on a sliding price scale, but browsing is like rummaging in an unorganized thrift store.

You might find the next big thing on Amie Street... just not today's big thing.

Like eMusic, Amie Street (amiestreet.com) is on a mission to expand your horizons. Most of its million-plus tracks come from small labels and independent musicians. Some major label artists are represented, but far fewer than we wanted to find. Worse, searches can’t be sorted by price or artist, making browsing a hassle. Songs are available as DRM-free variable bit rate MP3s with an average encoding of 256kbps, though the quality of files uploaded from independent artists may vary.

Happily, so do Amie’s prices. Songs first appear on the store for free or cheap, then increase in price as more people buy them, reaching a maximum $0.98 apiece. With some exceptions, albums cost the total of all their songs but are capped at $8.98. Amie lets you recommend music to earn “Street Cred,” money that can be spent in the store. All this means low or no cost for trying a lot of new music, though shoppers are limited to 80 free downloads every 8 hours. We can live with that, and a Mac-native downloading app and music-gifting sweeten the deal. We just wish you could gift more than one item at a time.


It's a dream streamer.

Lala boasts two music catalogs, and one of them is yours.

Lala (www.lala.com) flips the script on Rhapsody and Napster’s pay-to-stream subscription plans by letting you upload the tunes in your Mac’s Music folder--including iTunes playlists and old FairPlay-protected tracks--to stream from Lala’s site for free. Sound quality is excellent overall, but expect occasional distortion, mismatched playlist contents, and some misnamed tracks. The Web-based music player works just like iTunes.

This minor licensing miracle is achieved by Lala’s lawyers and a Mac-native Music Mover application that also syncs music bought at Lala back to your computer. Oh yeah, Lala sells DRM-free VBR MP3 files with average bit rates of 256kbps too. They’ll cost you $.89, $.99, and $1.29, but most songs go for only $.89. Albums cost $9.99, but look for deals--many can be had for less than Amazon’s price. Unfortunately, Lala’s selection could be better, even with 7 million–plus tracks. Some music is available only as $0.10 streaming Web Songs that can be accessed from Lala’s site. But even these, like regular MP3 downloads, can be given easily as gifts.

One caveat: As we went to press, Apple acquired Lala. No word yet on if Lala.com will stay open, or if Lala’s streaming or social features will be added to iTunes proper. Stay tuned.


A DJ's delight, its electronica tracks go on for miles, and it even has lossless WAV files.

One screen, many options, and 160 beats per minute.

As its naughty name suggests, Masterbeat (www.masterbeat.com) isn’t your grandma’s music store. Not unless she’s down with the dance, hip-hop, and electronica that abounds in its million-plus catalog, alongside instrumental and a cappella samples for your (or your grandma’s) party-starting needs. Tracks are DRM-free MP3 files encoded at 320kbps (some at 256kbps), and many are also available as uncompressed WAV files. Prices range from $0.99 to $1.99 per song, and WAV files cost a dollar extra. Full albums start at $9.99, but Masterbeat’s many EPs cost $5.96.

Navigating the site may take more time than you’d like--it’s an all-Flash control panel awash in tiny blue text and buttons that look like someone set the starship Enterprise’s computer to “complicated.” But once you make sense of Masterbeat’s madness, having nearly all its features in one window is convenient, if still hard to read. A robust search feature lets you sort by the usual suspects as well as record label, release-date range, and more. But between the restrictions on gifting options (sent via snail mail or emailed to other Masterbeat members only) and the unapologetic lack of music without block-rockin’ beats, this store’s appeal is limited.

The Winner

Despite impressive offerings from 7digital, eMusic, and Lala, at the end of the day we have to go with Amazon MP3 as our iTunes competitor of choice. Amazon MP3’s selection, Mac-friendliness, frequent specials, and low prices make a greatest-hits compilation that catapults the store ahead of its rivals. If Amazon put some of the design savvy that went toward the last Kindle revision into the look and feel of its music store, Apple might have some serious competition on its hands. Until then, Amazon will have to settle for being second in our hearts... but sometimes first in our wallets.

Score Free Music (Legally)

Stealing music is bad, mmkay, but if you're offered a free MP3 or two, it's okay to politely accept. Here's a handful of places you can find free tunes:

>> The iTunes Store has a Free On iTunes page with a small selection of rotating music and videos. Look for it at the bottom of the main iTunes Store page.

iTunes rotates a smallish selection of free music and videos.

>> Amazon’s free weekly downloads page is awesome. Go to Amazon.com/MP3 and look in the Browse MP3s sidebar for Free Songs & Special Deals. Or just navigate here and use the genre-selectors in the sidebar to narrow the search results.

>> Your favorite bands’ podcasts are free, and you already know you like them! Mouse over Podcasts in the black iTunes Store toolbar, click the down arrow, and select Music. Or use the store browser to get there.

>> Last.fm, in addition to its excellent free streaming, offers free MP3 downloads at www.last.fm/music/+free-music-downloads.

>> Insound.com has a page of free MP3s at www.insound.com/mp3/mp3s.php. The site specializes in indie rock and also sells MP3s, CDs, vinyl, and band merchandise.

>> A-M Classical (www.amclassical.com) offers free classical music tracks.

>> MP3 blogs post tons of songs every day. Check out aggregator Hype Machine (hypem.com), see a list of top blogs at hypem.com/toplist, and click around to find a few blogs that interest you. Then download Peel ($14.95, www.getpeel.com), a shareware app that monitors the blogs’ RSS feeds, grabs the new music, and even adds it to iTunes for you.

>> The Live Music Archive has lots of free live concert recordings. Head to www.archive.org/details/etree, and look for a link in the Browsing And Finding Shows section for “Browse artists with MP3s” to limit your search to MP3 files. We recommend the Del McCoury Band, the New Mastersounds, and Tenacious D.

WMG Lost Millions In Lala.com Deal

According to a proxy statement filed today, Warner Music Group (WMG) got about $9 million for Lala.com when it sold the online music service to Apple Inc. at the end of last year. WMG already wrote down $11 million of the $20 million it invested in Lala after disappointing results last year. On top of that, the music company also had warrants worth $4 million that were exercisable based on whether Lala.com was able to help sell 25 million CDs in five years after the original 2007 agreement, which did not occur.

The SEC filing says that in December 2009, "The Company sold its equity interest in Lala and entered into an agreement to terminate a memorandum of terms relating to the formation of an international joint venture for total cash consideration of approximately $9.0 million as part of a sale of Lala to Apple Inc. The warrants had an exercise price that was in excess of the total merger consideration paid in respect of the shares for which it could be exercised and, therefore, expired at the time of the closing of the sale of Lala to Apple Inc."

WMG also reported in the filing that it earned about $2.8 million in fees from mobile music company Thumbplay in fiscal 2009. In 2008, the company struck a deal with Thumbplay to provide music for its ringtones and full track downloads.

Why Bono is Wrong About Filesharing

P2P is fun: just let us pay for it
Paul Sanders

At a conference a few years ago IFPI Chairman John Kennedy said he had 'no problem' with China's approach to managing its citizens' use of the internet. It stuck in my mind for some reason. This Christmas, Bono pulled the somewhat cheap semantic and logical trick of suggesting that because China can suppress online dissent, and because ISPs can and do take some action to block child pornography, they therefore should also block copyright infringement. And that they should do so in order to help 'young fledgling songwriters' make a living.

I expect both would have a problem with the success rate in China; it is as leaky as a sieve, inside and out. Are the efforts of the IWF to block access to child pornography any more successful? Well, we do not know what we do not know. But that aside, surely all Bono's remarks, and Kennedy's, tell us is that people with strong incentives to do one thing generally don't do the opposite.

For Bono is probably the person least likely to say "we need to find a way to have many more artists and performers make a decent living, while allowing people on below average wages, and their children, to enjoy as much music as they like within their weekly budget". Or he might say it, in a sudden rush of blood to the head, but is surely least likely to do anything to make it happen.

The market, despite all the hot air about Long Tails, has spent the last decade relatively over-rewarding the hits. If ISPs have been leeching cash out of the record business, as Bono contends in another piece of sophistry ("rich service providers, whose swollen profits perfectly mirror the lost receipts of the music business"), then the studies are showing that it is the middle that is being slimmed, leaving a longer thinner tail and almost as fat a head as ever.

For the 'young fledgeling songwriter' - stick your hands up children, if you think that is you - success comes now as it always has, with either a breakthrough hit which nobody can ignore, or through the patronage of stars such as Bono, who can deliver a living wage to songwriters by performing their songs.
The politics of exclusion

Maybe it was a little political joke that the music industry gongs in the 2010 New Year's honours list went to the chairman of Universal Music and two members of Status Quo - because the big companies have every reason to keep things just as they are. That means trying to make sure that consumers spend as much money as possible on as few tracks as possible. So while in the best value deals the wholesale rate per track is hovering around 20p, you are not allowed to buy more at the same price - in fact with Sky Songs the price goes up if you want more than 20 tracks per month.

So perversely, if the pain of filesharing is felt disproportionately outside of the hits market, then the biggest companies have no reason to swap what they have now for a market that would give the smaller labels more chances to get paid.

Freedom, abundance, and a tenner a month

And with fewer companies in control of the cashflow, artists and songwriters have less bargaining power. While we enjoy watching popstars being created on TV shows, the contracts the contestants have to sign in order to participate are among the harshest in the business. Now Bono is asking us to accept that the cost of maintaining this control should be shared by us all: in the form of higher prices for an internet that we can do less with, and on which we can expect to be monitored by his business partners.

A Damascene conversion for Bono is presumably too much to ask for, but what of the efforts that are being made around the world to get the cash and music flowing without Bonoian snooping and filtering becoming part of the internet? ISPs in many countries in Europe and around the world stand ready to offer unlimited music services for a monthly fee, and consumers are saying clearly that they value music and are willing to pay. The Isle of Man has spent the last year in discussion with the music industry about using the island as an opportunity to learn what happens when you do take the restrictions off, in return for money.

In fact for the last three years we have been on the cusp of something rather wonderful - an age of freedom and abundance in music in which opportunity for new artists and songwriters is actually part of the system, rather than something only attainable with extreme perseverance and a huge amount of luck.

What is holding all this up is the music industry, throwing spanners, making unreasonable demands, being disorganised and confusing, and preferring to lobby for snooping and disconnection rights rather than getting on with the business of making and selling music.

So, Bono, how about it? Filling up a USB stick and swapping files in the playground should be one of the joys of youth, not something liable to get you cut off and in trouble with your parents. And does it really matter if a tenner a month is split with a few indie artists and fledgling songwriters? The big money will still be yours, as you rightly point out.

The kids are not eating your lunch any time soon. Because in so many ways you are doing much to deliver freedom and choice to a world which has treated you well, and especially to its children. Progress is surely giving more to more people, rather than restricting freedom to preserve the wealth of the few.

Open Letter From OK Go, Regarding Non-Embeddable YouTube Videos

To the people of the world, from OK Go:

This week we released a new album, and it’s our best yet. We also released a new video – the second for this record – for a song called This Too Shall Pass, and you can watch it here. We hope you'll like it and comment on it and pass the link along to your friends and do that wonderful thing that that you do when you’re fond of something, share it. We want you to stick it on your web page, post it on your wall, and embed it everywhere you can think of.

Unfortunately, as of now you can’t embed diddlycrap. And depending on where you are in the world, you might not even be able to watch it.

We’ve been flooded with complaints recently because our YouTube videos can't be embedded on websites, and in certain countries can't be seen at all. And we want you to know: we hear you, and we’re sorry. We wish there was something we could do. Believe us, we want you to pass our videos around more than you do, but, crazy as it may seem, it’s now far harder for bands to make videos accessible online than it was four years ago.

See, here’s the deal. The recordings and the videos we make are owned by a record label, EMI. The label fronts the money for us to make recordings – for this album they paid for us to spend a few months with one of the world’s best producers in a converted barn in Amish country wringing our souls and playing tympani and twiddling knobs – and they put up most of the cash that it takes to distribute and promote our albums, including the costs of pressing CDs, advertising, and making videos. We make our videos ourselves, and we keep them dirt cheap, but still, it all adds up, and it adds up to a great deal more than we have in our bank account, which is why we have a record label in the first place.

Fifteen years ago, when the terms of contracts like ours were dreamt up, a major label could record two cats fighting in a bag and three months later they'd have a hit. No more. People of the world, there has been a revolution. You no longer give a shit what major labels want you to listen to (good job, world!), and you no longer spend money actually buying the music you listen to (perhaps not so good job, world). So the money that used to flow through the music business has slowed to a trickle, and every label, large or small, is scrambling to catch every last drop. You can't blame them; they need new shoes, just like everybody else. And musicians need them to survive so we can use them as banks. Even bands like us who do most of our own promotion still need them to write checks every once in a while.

But where are they gonna find money if no one buys music? One target is radio stations (there's lots of articles out there. here's one: http://arstechnica.com/tech-policy/n...use-senate.ars ). And another is our friend The Internutz. As you’ve no doubt noticed, sites like YouTube, MySpace, and Blahzayblahblah.cn run ads on copyrighted content. Back when Young MC's second album (the one that didn't have Bust A Move on it) could go Gold without a second thought, labels would’ve considered these sites primarily promotional partners like they did with MTV, but times have changed. The labels are hurting and they need every penny they can find, so they’ve demanded a piece of the action. They got all huffy a couple years ago and threatened all sorts of legal terror and eventually all four majors struck deals with YouTube which pay them tiny, tiny sums of money every time one of their videos gets played. Seems like a fair enough solution, right? YouTube gets to keep the content, and the labels get some income.

The catch: the software that pays out those tiny sums doesn’t pay if a video is embedded. This means our label doesn’t get their hard-won share of the pie if our video is played on your blog, so (surprise, surprise) they won’t let us be on your blog. And, voilá: four years after we posted our first homemade videos to YouTube and they spread across the globe faster than swine flu, making our bassist’s glasses recognizable to 70-year-olds in Wichita and 5-year-olds in Seoul and eventually turning a tidy little profit for EMI, we’re – unbelievably – stuck in the position of arguing with our own label about the merits of having our videos be easily shared. It’s like the world has gone backwards.

Let’s take a wider view for a second. What we’re really talking about here is the shift in the way we think about music. We’re stuck between two worlds: the world of ten years ago, where music was privately owned in discreet little chunks (CDs), and a new one that seems to be emerging, where music is universally publicly accessible. The thing is, only one of these worlds has a (somewhat) stable system in place for funding music and all of its associated nuts-and-bolts logistics, and, even if it were possible, none of us would willingly return to that world. Aside from the smug assholes who ran labels, who’d want a system where a handful of corporate overlords shove crap down our throats? All the same, if music is going to be more than a hobby, someone, literally, has to pay the piper. So we’ve got this ridiculous situation where the machinery of the old system is frantically trying to contort and reshape and rewire itself to run without actually selling music. It’s like a car trying to figure out how to run without gas, or a fish trying to learn to breath air.

So what’s there to do? On the macro level, well, who the hell knows? There are a lot of interesting ideas out there, but this is not the place to get into them. As for our specific roadblock with the video embedding, the obvious solution is for YouTube to work out its software so it allow labels to monetize their videos, wherever on the Internet or the globe they're being accessed. That'll surely happen before too long because there's plenty of money to be made, but it’s more complicated than it looks at first glance. Advertisers aren’t too keen on paying for ads when they don’t know where the ads will appear (“Dear users of FoxxxyPregnantMILFS.com, try Gerber’s new low-lactose formula!”), so there are a lot of hurdles to get over.

In the meantime, the only thing OK Go can do is to upload our videos to sites that allow for embedding, like MySpace and Vimeo. We do that already, but it stings a little. Not only does it cannibalize our own numbers (it tends to do our business more good to get 40 million hits on one site than 1 million hits on 40 sites), but, as you can imagine, we feel a lot of allegiance to the fine people at YouTube. They’ve been good to us, and what they want is what we want: lots of people to see our videos. When push comes to shove, however, we like our fans more, which is why you can take the code at the bottom of this email and embed the "This Too Shall Pass" video all over the Internet.

With or without this embedding problem, we'll never get 50 zillion views on a YouTube video again. That moment – the dawn of internet video – is gone. The internet isn’t as anarchic as it was then. Now there are Madison Avenue firms that specialize in “viral marketing” and the success of our videos is now taught in business school. But here's a secret: zillions of hits was never the point. We're a rock band, and it’s a great gig. Not just because we get to snort drugs off the Queen of England (we do), but because the only thing we are expected to do is make cool stuff. We chase our craziest ideas for a living, and if sharing those ideas takes 40 websites instead of one, it doesn’t make too big a difference to us.

So, for now, here's the bottom line: EMI won't let us let you embed our YouTube videos. It's a decision that bums us out. We've argued with them a lot about it, but we also understand why they're doing it. They’re aware that their rules make it harder for people to watch and share our videos, but, while our duty is to our music and our fans, theirs is to their shareholders, and they believe they’re doing the right thing.

Here’s the embed code for the Vimeo posting:
<object width="400" height="300"><param name="allowfullscreen" value="true" /><param name="allowscriptaccess" value="always" /><param name="movie" value="http://vimeo.com/moogaloop.swf?clip_id=8718627&amp;server=vimeo.com&amp;show_ title=1&amp;show_byline=1&amp;show_portrait=0&amp;color=&amp ;fullscreen=1" /><embed src="http://vimeo.com/moogaloop.swf?clip_id=8718627&amp;server=vimeo.com&amp;show_ title=1&amp;show_byline=1&amp;show_portrait=0&amp;color=&amp ;fullscreen=1" type="application/x-shockwave-flash" allowfullscreen="true" allowscriptaccess="always" width="400" height="300"></embed></object><p><a href="http://vimeo.com/8718627">OK Go - This Too Shall Pass</a> from <a href="http://vimeo.com/user2495615">OK Go</a> on <a href="http://vimeo.com">Vimeo</a>.</p>

Go forth and put it everywhere, please. And buy our album. It’s great.

Yours Truly,

Damian (on behalf of OK Go)


Once Thought Of As The Future Of Music, The Birotron Attempts To Make A Return
William Weir

Paul McCartney wanted one, the story goes; so did Led Zeppelin. Promoted in the 1970s as the "orchestra at your fingertips," it was an unlikely combination of a piano keyboard and a series of 8-track tape players cobbled together in a Wallingford garage by an unemployed musician with no mechanical experience.

The Birotron was going to revolutionize music, and local papers hailed the Wallingford resident as the next Les Paul or Robert Moog. "Birotron Starts Tremor in Rock World: Ragged Inventor Awaits Riches," read one headline. More than 30 years later, only six Birotrons are known to exist. Its appearance on record has been limited to a handful of albums, including two by the progressive rock band Yes.

But the Birotron has never been completely forgotten. The instrument often described as "ill-fated" has received renewed interest in recent years. Writer Paul Collins detailed the history of the Birotron a few years ago in the literary magazine "The Believer." David Biro and his creation appear in the 2009 documentary "Mellodrama" (the DVD will be released this week). And there's talk of reviving the Birotron for real.

Part of this might have to do with the "what if?" factor; had the Birotron succeeded, how would it have changed pop music? Biro says he's surprised by the continuing interest.

"When I first got the idea for it, I only planned on making one for myself," Biro says. "Making money had nothing to do with it. I wanted it to help further my musical career, but instead it ended up sidetracking my career to the point of no return."

Cult status, of course, doesn't pay bills. Today, Biro lives in a mobile home in Bayou George, Fla. He's been unemployed for the past few months after the car upholstering business he worked for folded.

"It didn't fail because it was a bad idea," says David Kean, an electronic music historian and owner of Mellotronics in Calgary. "It didn't fail because it was poorly designed. It failed because [Biro] counted on the fortunes of a rock star, and that's always a dicey proposition."

That rock star was Yes keyboardist Rick Wakeman, whose flashy style made the synthesizer seem as cool as the electric guitar in the early 1970s. The lives of the two 20-something men — one an out-of-work factory worker, the other a British musician known for elaborate stage costumes, would soon intersect to create an odd chapter in music history.

Biro first saw Wakeman perform in 1973 in Wallingford and was immediately star-struck. With binoculars, he analyzed Wakeman's keyboard setup and committed it to memory. Wakeman had a Mellotron, so Biro also wanted one.

Considered one of the earliest music samplers, the Mellotron's tones come from prerecorded tapes of other instruments. Press a key and, voila! Cello sounds, organ sounds, choir sounds. But the limitations of pre-digital technology made the tones sound like, well, recordings. Biro balked at spending $3,500 for it.

"I think I literally said, 'I could do better than this in my father's garage,'" says Biro, now 60. So with a $400 unemployment check, he bought 19 used 8-track players and got to work in his father's garage. He spent more than 100 hours chopping up and reassembling the keyboard of an upright piano. He opened up 8-track cartridges and replaced the tapes with recordings he made from the Mellotron. Biro had no formal mechanical training, and the process was an arduous one.

"I remember when I got the first two notes, I plugged in the keyboard and played them, and went 'woah!,'" he says. "And in a few days, I could play a whole chord."

Because each key sounded the tape loop of an 8-track cartridge, Birotron notes lasted indefinitely. The Mellotron's notes lasted only 8 seconds before the tapes had to rewind.

He played it for the members of his Meriden-based hard rock band, Blackwood. One suggested showing it to Wakeman. Biro laughed. Rick Wakeman! It could never happen. But his band's manager was able to set up a meeting after a show at the New Haven Coliseum in October 1974. Biro threw his invention into the trunk of his Pinto and drove to the Coliseum.

"The escalators were all going down, so I had to run up the friggin' escalators, seven stories, as fast I could while carrying this thing," he says.

Backstage, Wakeman gave it a go. He smiled.

"He said, 'How would you like to make some money with this?'" Biro recalls. "It was surreal, I was on cloud one hundred and ninety-nine. I couldn't believe it was happening. He was my idol."

Wakeman also remembers the meeting.

"The Birotron I loved when I first saw it, because it solved a lot of the problems that the Mellotron had, and I could see a future in it," he said in an e-mail.

Within two months, Biro was in London, part of Birotronics Ltd., Wakeman's newly minted company. Word got out about the new instrument.

"Everybody who was anybody wanted one," Biro says. The Beach Boys and Paul McCartney expressed interest, he says. One of his favorite memories is discussing the Birotron over the phone with John Paul Jones of Led Zeppelin.

But after many delays in the instrument's launch, Biro felt increasingly shut out of the process. "It kind of got out of my control."

The Birotron's Downfall

Biro remembers razzing Wakeman about his many marriages. Wakeman was going through an especially costly divorce at the time, a serious drain on funds. But Wakeman's love life alone didn't kill the Birotron. The prototype bore a flaw not in Biro's original design: The 8-track players were placed horizontally, instead of vertically. "Eight-track tapes don't like standing like that," he says. "For whatever reason, the tapes jam up."

But it was digital technology that finally killed the Birotron. The new music samplers boasted sounds much closer to the original sources, and Wakeman figured their product was obsolete. Production of the Birotron, which would have retailed for about $3,000, stopped altogether. About a dozen were made — numbers vary depending on whom you ask. Wakeman had one, but it was stolen.

In 2005, the Times of London reported that one Birotron owner sold his for $35,000. Biro, who owns one, doubts he could get that kind of money for his in this economy.

Craig Wuest of Atlanta is another Birotron owner. He got his from a former member of the German electronic band Tangerine Dream. Wuest's old band, Earthstar, is one of the few to commit the instrument's sounds to a commercial recording.

"I was taken by [the Birotron] because it doesn't sound like anything else, it just doesn't," he says, adding that he doesn't play it for fear of wearing out the instrument's parts.

Wakeman and Biro last saw each other in 1994 and speak fondly of each other. Wakeman also remembers the Birotron fondly, even though "it almost bankrupted me." The musician says he invested "a small fortune" in the instrument, but won't specify how much.

Biro tried working out a deal in the U.S. with some Stratford entrepreneurs. That deal was killed by the recession, but Biro earned $5,000 from it, the only money he has made off the Birotron.

But the unique Birotron chorus sound lives on, thanks to the instrument that inspired it. Streetly Electronics, a company based in the United Kingdom, offers it as part of its catalogs of tapes for the Mellotron. The Canadian band Arcade Fire uses it on the soundtrack it recorded for the recent film "The Box." Does Biro get royalties?

"No, no, of course not!" he says, laughing. "Why do you think I'm broke?"

Chris Dale, a Birotron enthusiast in Toronto who befriended Biro some years ago, thinks that the Birotron could be revived in some form — perhaps as digital sounds that could be downloaded for a fee. "It would be great if Dave could make some money off this," he says. "I'd like to see the whole problem redeem itself."

He says there's enough curiosity about the Birotron to make it work.

"It would have been interesting to see how all these musicians would have used this instrument," he says. "It's this unexplored thing that never had a chance to emerge."

Hear a sample of the Birotron sound featured on the Yes album Tormato, "On the Silent Wings of Freedom," at courant.com/birotron.

Liberal Talk-Radio Station Air America Files for Bankruptcy, Will go Off the Air
Paul Farhi

Air America, the liberal talk-radio network that helped boost the careers of Al Franken and Rachel Maddow, said Thursday that it was declaring bankruptcy and going off the air.

The company, founded in 2004 and based in New York, strove to provide left-leaning commentary and call-in programs as an alternative to such popular conservative radio talkers as Rush Limbaugh, Sean Hannity and Michael Savage.

It was troubled almost from the start. The company had difficulty lining up affiliates and attracting a sizable audience. It filed for Chapter 11 bankruptcy-court protection just 30 months after its inception and was resold to an investor group in early 2007 for $4.25 million.

Charlie Kireker, one of Air America's principal owners and its chairman, said in a memo to employees Thursday that the company was done in by "a perfect storm" of plunging ad revenues, intense competition, high debt and poor prospects for new financing. A search for new investors, he said, has been fruitless. The company declined further comment.

Air America's chief executive is Bennett Zier, who previously founded and headed Redskins owner Daniel Snyder's broadcasting company, Red Zebra, and was the top executive of Clear Channel Broadcasting's cluster of eight major stations in the Washington area. The company's programming director, Bill Hess, is also a longtime Washington radio executive.

Since last summer, Air America has been heard in the Washington area on WZAA (1050 AM). Its audience has been so small that Arbitron, which compiles radio ratings, was unable to detect any listeners for WZAA during several weeks in December.

Franken was one of Air America's earliest program hosts; he left the network in 2007 to launch his successful bid for the U.S. Senate in Minnesota. Maddow, another host, made the transition to television and hosts a nightly show on MSNBC. Ron Reagan Jr., Arianna Huffington and Montel Williams have also had Air America programs.

Ana Marie Cox, who has hosted a one-hour program on Air America on Saturday and Sundays for the past year, said on Thursday that news of the network's demise took her by surprise. She said that the programming, as well as Air America's Web site, had begun to improve of late but that people hadn't caught up to it.

"I'd gotten used to people saying: 'Oh, Air America. Is that still around?'" Cox said. "One of my standard jokey responses was, 'Well, my paycheck still clears.' I guess that will stop."

The network, she said, had tried to incorporate more humor and move away from being an "angry" liberal version of conservative talk radio, which can be argumentative and aggressive. "I think the progressive or liberal audience likes a different type of discussion," she said.

Kireker said in his memo that Air America will carry reruns of earlier programs until it goes off the air at 9 p.m. Monday.

Where’s Johnny? Good Manners Take Hiatus
Alessandra Stanley

It was almost touching to see Conan O’Brien look so tickled about his sudden rise in ratings. The departing host of “The Tonight Show” looked less surprised than gratified, as if he had at last won the mass audience he believes he deserves.

People are riveted by the NBC debacle for reasons that have nothing to do with talent and everything to do with expectations. The Leno-O’Brien fracas is both shocking — an explosion of incivility that burns through late-night bonhomie — and also reassuring. It turns out that the cliché that comics are angry, bitter people deep down is true. NBC on Thursday confirmed it had reached a deal with Mr. O’Brien to walk away. And Mr. O’Brien, who is getting an estimated $32.5 million, is still using his last moments on the “Tonight” stage attacking the network. And that includes spending extravagantly on frills for the show, like the rights to use the Rolling Stones song “Satisfaction.”

Even the imperturbably jovial Jay Leno, who is getting what he wanted, namely “The Tonight Show” back, dropped his Everyman mask this week to aim a cross-network shot at David Letterman, who has mocked him and NBC unmercifully. “You know the best way to get Letterman to ignore you?” Mr. Leno said in his monologue on Wednesday. “Marry him.”

This normally doesn’t happen. Television in the reality-show era is a world of rudeness and disinhibition except on network late-night programs, where old-fashioned show business etiquette, the Johnny Carson model, still rules. In an era of the Internet and too much choice on cable, the traditional talk shows have lost their sovereignty — even mock-news programs like “The Daily Show with Jon Stewart” and “The Colbert Report” have siphoned away viewers. Classic late-night shows now distinguish themselves most by not being too distinctive.

However clownish, the late-night host is cool and self-contained, sending up the water-cooler follies of the day at a benevolent remove. Suddenly, Mr. Leno, Mr. O’Brien, Mr. Letterman and their ilk are the water-cooler folly, and they are neither removed nor benevolent. At times they have seemed as outraged and sanctimonious as the politicians, news anchors and movie stars they normally lampoon.

Mr. Leno and his peers will undoubtedly try to go back to normal once Mr. O’Brien is gone and his “Team CoCo” followers calm down, but the veneer of late-night niceness may be gone for good.

Mr. Letterman is an exception, of course. His comic style is laced with his peeves and personal grievances; when he lost “The Tonight Show” job to Mr. Leno in 1992 and moved to CBS the next year, he made a running joke of that setback and network executives, but after a while he mostly left Mr. Leno alone.

That ended almost as soon as NBC began its bizarre programming switcheroo, as the feeble ratings of Mr. Leno’s new 10 p.m. comedy show alarmed the network’s local affiliates. Mr. Letterman came down with a late-night version of posttraumatic stress disorder, reliving through Mr. O’Brien his own sense of ill treatment. His mockery of Mr. Leno has been savage — including high-pitched imitations of his rival’s voice — but he hasn’t let his allegiance to Mr. O’Brien totally cloud his own discontents. Noting Mr. O’Brien’s huge payout, Mr. Letterman said sourly, “You know, when I left NBC, all I got was a restraining order.”

Mr. Letterman’s barbs are some of the sharpest of the three, but they are not as unsettling because he has a long history of living his life onstage, notably when he told viewers he was being blackmailed over an affair with a staff member, and it turned out he wasn’t kidding.

Mr. Leno and Mr. O’Brien, on the other hand, keep their personal lives out of their comedy, trading instead on friendly facades — there is nothing dark or mysterious about them, or there wasn’t until now. Mr. Leno, who was magnanimous at first, has grown defensive and even somewhat surly, which clashes with his Teflon comic persona but is somewhat understandable: a jeering jury of his peers, including Jimmy Kimmel of ABC, portray him as a piggish diva who stole “The Tonight Show” after giving it to Mr. O’Brien.

And Mr. O’Brien, who began on a self-deprecating note, has turned more self-righteous in his monologues, blaming the network and Mr. Leno for taking back the show only seven months after he started. And his sense of betrayal is perhaps fanned by the followers who have held protests outside NBC headquarters at Rockefeller Center, as if the network is Myanmar and Mr. O’Brien the Daw Aung San Suu Kyi of late-night comedy.

All the comedians have been funny about their plight, but at the moment it’s their lack of humor that is the spectacle. Viewers are transfixed like schoolchildren watching their teachers break into a food fight — delighted, but also disoriented.

Mr. O’Brien, whose settlement requires him to stay off television for seven months after Friday, will live to joke another day, and Mr. Leno has plenty of time to restore his nice-guy image. Mr. Letterman and the others will move on to other topics.

Contention is hardly rare anymore on television; it’s harmony that’s hard to find. The mystique of late night — the illusion of effortless wit and widespread good will — is the one thing that sets these shows apart and keeps viewers in the habit of tuning in. And that may never be fully restored.

'Watching TV May Shorten Life for Couch Potatoes'

EVERY hour spent sitting idle in front of the television raises the risk of premature death from heart disease by 18%, an Australian study found. Researchers tracked the TV-viewing habits of 8,800 adults and followed them for six years. They found those who spent four hours daily in front of the tube had an 80% greater risk of dying from cardiovascular disease than those who watched the box for less than two hours. The association was independent of risks such as smoking, obesity and unhealthy diet.

Prolonged inactivity, which can raise blood-sugar and cholesterol levels, is to blame for the health effects, not the appliance itself, said David Dunstan, a study author and researcher at Baker IDI Heart & Diabetes Institute in Melbourne. The finding, published today in the medical journal Circulation, supports studies from the Rochester, Minnesota-based Mayo Clinic showing that watching too much television is one of the biggest contributors to a sedentary lifestyle and weight gain.

“Too much sitting is bad for health,” said Dunstan, a professor of health sciences. “Avoid sitting for prolonged periods and keep in mind to move more, more often.”

Australians and Britons watch television for an average of three hours a day. In the US, where two-thirds of all adults are overweight or obese, viewing time is as much as eight hours, Dunstan said.

Rickets Makes Comeback Among Computer Generation

The growth of the computer generation and changing lifestyles among children are leading to a Vitamin D deficiency and a rise in cases of rickets, medical experts have warned.

Rickets, where children develop painful and deformed bow-legs and do not grow properly, is a condition linked with Victorian era poverty.

They said youngsters were spending more time indoors on their computers rather than previous generations who spent time playing outside with their friends.

The two medical experts have called for Vitamin D to be added to milk and other food products.

They said modern diets often lack Vitamin D and this could be a big reason - along with changing lifestyles - for the increasing health problems, in particular rickets in children.

The main source of Vitamin D is sunlight, through skin exposure. But it is also present in a small number of foods, such as oily fish or cod liver oil.

Writing a clinical review in the latest issue of the British Medical Journal, Professor Simon Pearce and Dr Tim Cheetham, of Newcastle University, call for a change in public health policy.

Prof Pearce, a professor of endocrinology, said: ''Kids tend to stay indoors more these days and play on their computers instead of enjoying the fresh air.

''This means their Vitamin D levels are worse than in previous years.

''A change in public health policy is required. Health professionals have been slow to deal with this problem, even though we have known about it for a while.

''Some measures have been taken but the number of patients still presenting with symptoms of Vitamin D deficiency shows we have a long way to go.''

Rickets, where children develop painful and deformed bow-legs and do not grow properly, is a condition linked with poverty, starvation, Victorian times or those in the developing world - not with 21st century Britain.

But it is a very real concern, with several studies showing that numbers are increasing. More than 20 new cases are discovered every year in Newcastle alone.

Dr Cheetham, a senior lecturer in paediatric endocrinology, said: ''I am dismayed by the increasing numbers of children we are treating with this entirely preventable condition.

''Fifty years ago, many children would have been given regular doses of cod liver oil, but this practice has all but died out.''

Half of all adults in the UK have Vitamin D deficiency in the winter and spring, and one in six having severe deficiency.

This is worse in the north of England and could be part of the reason for the health gap between the north and south, the experts said.

And the condition has been linked to cardiovascular disease, type 2 diabetes, several cancers, and autoimmune conditions as well as osteomalacia, which is the painful manifestation of soft bones in adults.

There are several high risk groups who are most in danger from suffering from deficiency including people with skin pigmentation, those who use sunscreen or concealing clothing, being elderly or institutionalised, people who are obese, and those suffering from renal and liver disease.

Prof Pearce added: ''We believe that a more robust approach to statutory food supplementation with Vitamin D, for example in milk, is needed in the UK, as this measure has already been introduced successfully in many other countries in similar parts of the world.''

If Your Kids Are Awake, They’re Probably Online
Tamar Lewin

The average young American now spends practically every waking minute — except for the time in school — using a smart phone, computer, television or other electronic device, according to a new study from the Kaiser Family Foundation.

Those ages 8 to 18 spend more than seven and a half hours a day with such devices, compared with less than six and a half hours five years ago, when the study was last conducted. And that does not count the hour and a half that youths spend texting, or the half-hour they talk on their cellphones.

And because so many of them are multitasking — say, surfing the Internet while listening to music — they pack on average nearly 11 hours of media content into that seven and a half hours.

“I feel like my days would be boring without it,” said Francisco Sepulveda, a 14-year-old Bronx eighth grader who uses his smart phone to surf the Web, watch videos, listen to music — and send or receive about 500 texts a day.

The study’s findings shocked its authors, who had concluded in 2005 that use could not possibly grow further, and confirmed the fears of many parents whose children are constantly tethered to media devices. It found, moreover, that heavy media use is associated with several negatives, including behavior problems and lower grades.

The third in a series, the study found that young people’s media consumption grew far more in the last five years than from 1999 to 2004, as sophisticated mobile technology like iPods and smart phones brought media access into teenagers’ pockets and beds.

Dr. Michael Rich, a pediatrician at Children’s Hospital Boston who directs the Center on Media and Child Health, said that with media use so ubiquitous, it was time to stop arguing over whether it was good or bad and accept it as part of children’s environment, “like the air they breathe, the water they drink and the food they eat.”

Contrary to popular wisdom, the heaviest media users reported spending a similar amount of time exercising as the light media users. Nonetheless, other studies have established a link between screen time and obesity.

While most of the young people in the study got good grades, 47 percent of the heaviest media users — those who consumed at least 16 hours a day — had mostly C’s or lower, compared with 23 percent of those who typically consumed media three hours a day or less. The heaviest media users were also more likely than the lightest users to report that they were bored or sad, or that they got into trouble, did not get along well with their parents and were not happy at school.

The study could not say whether the media use causes problems, or, rather, whether troubled youths turn to heavy media use.

“This is a stunner,” said Donald F. Roberts, a Stanford communications professor emeritus who is one of the authors of the study. “In the second report, I remember writing a paragraph saying we’ve hit a ceiling on media use, since there just aren’t enough hours in the day to increase the time children spend on media. But now it’s up an hour.”

The report is based on a survey of more than 2,000 students in grades 3 to 12 that was conducted from October 2008 to May 2009.

On average, young people spend about two hours a day consuming media on a mobile device, the study found. They spend almost another hour on “old” content like television or music delivered through newer pathways like the Web site Hulu or iTunes. Youths now spend more time listening to or watching media on their cellphones, or playing games, than talking on them.

“I use it as my alarm clock, because it has an annoying ringtone that doesn’t stop until you turn it off,” Francisco Sepulveda said of his phone. “At night, I can text or watch something on YouTube until I fall asleep. It lets me talk on the phone and watch a video at the same time, or listen to music while I send text messages.”

Francisco’s mother, Janet Sepulveda, bought his phone, a Sidekick LX, a year ago when the computer was not working, to ensure that he had Internet access for school. But schoolwork has not been the issue.

“I’d say he uses it about 2 percent for homework and 98 percent for other stuff,” she said. “At the beginning, I would take the phone at 10 p.m. and tell him he couldn’t use it anymore. Now he knows that if he’s not complying with what I want, I can suspend his service for a week or two. That’s happened.”

The Kaiser study found that more than 7 in 10 youths have a TV in their bedroom, and about a third have a computer with Internet access in their bedroom.

“Parents never knew as much as they thought they did about what their kids are doing,” Mr. Roberts said, “but now we’ve created a world where they’re removed from us that much more.”

The study found that young people used less media in homes with rules like no television during meals or in the bedroom, or with limits on media time.

Victoria Rideout, a Kaiser vice president who is lead author of the study, said that although it has become harder for parents to control what their children do, they can still have an effect.

“I don’t think parents should feel totally disempowered,” she said. “They can still make rules, and it still makes a difference.”

In Kensington, Md., Kim Calinan let her baby son, Trey, watch Baby Einstein videos, and soon moved him on to “Dora the Explorer.”

“By the time he was 4, he had all these math and science DVDs, and he was clicking through by himself, and he learned to read and do math early,” she said. “So if we’d had the conversation then, I would have said they were great educational tools.”

But now that Trey is 9 and wild about video games, Ms. Calinan feels differently.

Last year, she sensed that video games were displacing other interests and narrowing his social interactions. After realizing that Trey did not want to sign up for any after-school activities that might cut into his game time, Ms. Calinan limited his screen time to an hour and half a day on weekends only.

So last Wednesday, Trey came home and read a book — but said he was looking forward to the weekend, when he could play his favorite video game.

Many experts believe that media use is changing youthful attitudes.

“It’s changed young people’s assumptions about how to get an answer to a question,” Mr. Roberts said. “People can put out a problem, whether it’s ‘Where’s a good bar?’ or ‘What if I’m pregnant?’ and information pours in from all kinds of sources.”

The heaviest media users, the study found, are black and Hispanic youths and “tweens,” or those ages 11 to 14.

Even during the survey, media use was changing.

“One of the hot topics today is Twitter, but when we first went into the field and began interviewing, Twitter didn’t exist,” Ms. Rideout said.

The Life and Death of Alan Carton, 23, the RIAA-Defying Creator of @diditleak
Christopher Weingarten

For two years, the Twitter account @diditleak was the secret weapon of online listeners and music critics alike. In real time, the account, which ultimately garnered over 11,500 followers, announced whenever a digital copy of a particularly desirable record first hit the Internet. For that it became a beloved resource of torrent-hungry music fans and writers angling for first listens. Using email tips and message-board-scouring alchemy, @diditleak seemed to know leaks better than anybody on Earth.

The feed's creator was Alan Carton, a then-21-year-old Vancouver film student who worked on the site in total anonymity. On January 5, @diditleak went dark. Its creator's name is only being revealed now because on January 16th, after a long hospital stay, Alan Carton died. He was 23. In his final days, Carton worked on @diditleak from his hospital bed, posting tips about the new Yeasayer record at a time when doctors were saying he could lapse into a coma at any minute. His story--as told by his mother Jennifer to Voice--is unlikely, to say the least.

When Alan was 18, he put off college to work as an electrician in his hometown of Edmonton, Alberta. At work, he'd drop his hammer into the loop of his overalls, where it would brush against a lump on his leg. He and his mother, Jennifer Carton, assumed that the bump was a cyst. But after six months of work, Carton got a biopsy result that indicated that the lump on his leg was sarcoma soft tissue cancer.

"Whatever" was Alan's first reaction. Canadian hero Terry Fox had jogged across the country after losing his leg to sarcoma. Carton, too, could overcome this. But a full MRI showed that Alan had six cancer spots on one lung and nine on the other. The ensuing eight-hour chemotherapy treatments left him drained and unemployed. In his boredom, Carton taught himself how to play guitar and keyboard with computer programs. He entered a MuchMusic music trivia contest and won a new dirtbike that he never got to ride.

After twelve months of radiation, the spots in his lung and the tumor in his leg were still present. Doctors removed 45% of the muscle in his leg, leaving him with a limp and a scar, though his friends didn't mind--Carton's crutches got them good seats at Oilers games. After further visits, the doctor pulled Alan and his mother aside. Carton's lung spots had grown but if the doctors operated, Alan would have nothing to breathe with, leaving a 20-year-old kid strapped to an oxygen mask forever. The doctor told Alan that they were thinking of surgery the following week, but had decided against it. Alan said, "Well I'm glad you're not because we're all going to Calgary for an outdoor concert." Everyone thought it would be best that Alan go out and enjoy the rest of his life.

While her son was in Calgary, Jennifer took a week off work and cried. "I thought, I can't live like this," she says. "I can't just sit here and wait for this boy to die." So instead, she and her son concocted a plan for Alan to live his dream of going to Vancouver Film School, where he wanted to study sound design. They put their home up for sale a month later, the pair made the 10-hour drive from Edmonton to Vancouver with their Shih Tzu, Snowee, talking the entire way. At college, Carton didn't tell anyone he had cancer--neither the admissions board nor his friends. Every ten weeks he would take a weekend flights back to Edmonton for doctor's appointments, returning to school early on Monday morning.

In 2007, halfway through his first semester, Carton started Did It Leak--which began life as a blog--with the goal of total anonymity. For a year, he didn't even tell his mother about the site. When he finally confessed, Jennifer asked how he knew that albums were leaking. He replied, "I just know. I can't tell you how I find out, I just know." He showed her a map of where his followers were coming from--Ireland, London, Japan, Australia, Spain. People were sending tips about leaked albums to his anonymous email account. Magazines like the Italian edition of Marie Claire and Canadian newspapers were hankering for interviews. According to Jennifer, his site was valuable enough to working critics that a writer from The Chicago Sun-Times contacted him for his leak-scouring secrets. Carton turned down interviews to help keep the mystery alive.

During his eleventh month of school, Carton began having trouble breathing: a tumor was growing over his windpipe. He finished up school rapidly, returned to Edmonton, and worked part time at a radio station. By the spring of 2008, his tumor had grown and was pushing up against his ribs. Carton was down to 90 pounds and required a hospital visit for dehydration. In the hospital, he got a headache, which the doctor told him was a brain tumor in his right lobe. That meant a seizure or coma could happen at any time. The tumor would have to be radiated immediately.

At the hospital, Carton saw the leak tips arriving on his phone and was clamoring for his laptop. "Oh my God! I gotta get on here, my followers will be wondering what I've got!" he said, according to his mother. He was admitted to the hospital on a Friday and was updating @diditleak by Sunday. "In the hospital, he always had his laptop with him and his cellphone," Jennifer remembers. "Alan would write while he was in bed. People write and say his 'company' was so cool. He said, 'Little do they know I'm just lying in the hospital here with cancer, just bored with nothing to do.'"

He told his mother that if a doctor informed her he was going to die, he'd prefer to remain oblivious--he wanted to go on living. After he got out of the hospital, he went on trips with his friends and mom to New York, California, and Ireland. He got a new tumor on his hip and after October never walked again. By December he was 85 pounds and barely hanging on, but Carton and @diditleak persevered. He fell out of his wheelchair and bloodied his head. He started getting confused, dizzy, antsy and agitated. He started saying things and he didn't know what they meant.

On January 5, Carton added his final post--a notification about the leak of the new Vampire Weekend, currently the number one album in the country. For weeks, he hadn't wanted to go to the hospital unless it was absolutely necessary, but now he looked up at his mother at 2 a.m. and said, "I think it's time." His lung had filled with fluid and his body was going into panic mode. The hospital filled him with morphine and drained his lung. On Saturday, January 16, Adam Carton passed away at the age of 23

Now @diditleak is quiet, stuck on January 5. "I'm sure he said to me Lily Allen sent an email to say that she checks his site," says Jennifer, who allows that it could've been any pop star, really. "He said, 'I wish these people would ask me when their albums were about to leak--I could tell them.'"

Until next week,

- js.

Current Week In Review

Recent WiRs -

January 16th, January 9th, January 2nd, December 26th

Jack Spratts' Week In Review is published every Friday. Submit letters, articles, press releases, comments, questions etc. 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.

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