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Old 12-10-11, 07:20 AM   #1
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Default Peer-To-Peer News - The Week In Review - October 15th, '11

Since 2002


































"It’s a fact of life on the Web. Identity will leak to a third party." – Jonathan Robert Mayer


"Nobody deserves to have to die - not Jobs, not Mr. Bill, not even people guilty of bigger evils than theirs. But we all deserve the end of Jobs' malign influence on people's computing." – Richard Stallman



































October 15th, 2011




The Only Way To Stop File Sharing Is To Stop Private Communications
Mike Masnick

Christian Engstrom, one of the Pirate Party's elected officials in the EU Parliament, has a straightforward, but completely worthwhile read, about how copyright law today simply doesn't fit with what technology has enabled. He worries that the laws are making nearly everyone a criminal -- and worse, that the direction of change has to make it even worse, not better.

It is impossible to enforce the ban against non-commercial file sharing without infringing fundamental rights. As long as there are ways for citizens to communicate in private, they will be used to share copyrighted materials. The only way to even try to limit file sharing, is to remove the right to private communication. In the last decade, this is the direction that copyright enforcement legislation has moved in, under pressure from big business lobbyists who see their monopolies under threat. We need to reverse this trend, in order to safeguard the fundamental rights.

Furthermore, he notes that when you look at the actual details, it certainly does not show an industry in trouble. Perhaps parts of the industry -- the parts betting on distribution over plastic discs -- have had some trouble. But the rest looks pretty damn good:

In the economic statistics, we can see that household spending on culture and entertainment is slowly increasing year by year. If we spend less money on buying CD records, we spend more on something else, like for instance going to live concerts. This is great news for the artists. An artist will typically get 5-7% of the revenues from a CD record, but 50% of the revenues from a concert. The record companies lose out, but this is only because they are no longer adding any value.

It may well be that it will become more difficult to make money within some parts of the cultural sector, but if so, it will become easier in some other — including new ones, that we have not even imagined so far. But as long as the total household spending on culture continues to be on the same level or rising, nobody can claim that the artists as a group will have anything to lose from a reformed copyright.


Finally, he compares the way the entertainment industry today reacts to file sharing to the way book publishers reacted to public libraries:

When public libraries were introduced in Europe 150 years ago, the book publishers were very much opposed to this. The argument they used was the same one that is being used today in the file sharing debate: If people could get access to books for free, authors would not be able to make a living, and no new books would be written.

We now know that the arguments against public libraries were wrong. It quite obviously did not lead to a situation where no new books were written, and it did not make it impossible for authors to earn money from writing. On the contrary, free access to culture proved to be not only a boon to society at large, but also turned out to be beneficial to authors.


But rather than learning from history, the industry still seeks to deny it.
http://www.techdirt.com/articles/201...ications.shtml





“Going BitTorrent” Settles FrostWire’s FTC Charges
Ernesto

The popular file-sharing application FrostWire has settled its dispute with the Federal Trade Commission (FTC). The FTC accused FrostWire of disregarding the privacy of its users, by not making it clear enough that their files are publicly shared when downloads are finished. By turning FrostWire into a BitTorrent-only client the company was able to swiftly settle the charges and avoid a lengthy court battle.

To those who are not that tech-savvy, file-sharing applications that share all files by default can pose a threat.

This is one of the main reasons why the FTC filed a complaint against FrostWire at a federal court. The government agency, which aims to protect the rights of consumers, alleged that FrostWire was disregarding users’ privacy by sharing files by default.

Although some companies might view a looming lawsuit by the FTC as a massive problem, the FrostWire team approached the court case in a rather pragmatic way. The commission first contacted FrostWire in May, and by the end of the month the company had already delivered a version complying with the majority of the proposed changes.

“We are software people, and saw this as a bug fix that happened to be reported by the FTC,” FrostWire’s Angel Leon told TorrentFreak.

“Nobody as far as we know ever complained for having finished downloads shared by default, to us it was a given of P2P, but now we feel better that users are in full control of what’s being shared.”

FrostWire users could always prevent automatic sharing in just a click or two, but the FrostWire team understood the issues brought up by the FTC and quickly took action. By leaving Gnutella – which was little more than a spam farm after LimeWire shut down – FrostWire decided to become a BitTorrent-only client.

“We actually made our software compliant by making the allegations irrelevant once we dropped Gnutella. Now there’s no concept of ‘shared folders’ anymore and it’s pretty clear where all files are saved, and if the user is seeding or not,” Leon said.

FrostWire sees the FTC intervention as one of the most helpful bug reports in the company’s history.

“Thanks to this whole ordeal we made our application a lot better. In a matter of a couple of weeks, we had the last version of FrostWire 4.21.x fully compliant with the order, and then we just made the decision to go 100% with BitTorrent,” Leon says.

“With BitTorrent we feel that our users’ privacy is better protected than when we had Gnutella, and now they’re certainly immune to spam search results.”

Aside from the desktop application, FrostWire also has an Android app that runs on a separate file-sharing network developed by the company. For this mobile application the company changed the default settings so users have to opt-in before they share something.

As a result, the number of shared files dropped dramatically, so FrostWire will soon turn the Android application into a BitTorrent client as well. The source of this new client will be released under a GPL license as soon as the first version comes out.

Overall both the FTC and FrostWire are happy with how things worked out. Consumers on the other hand benefit from the relative privacy of BitTorrent, where no shared folders exist.
https://torrentfreak.com/going-bitto...harges-111011/





German Book Association Decries E-Book Piracy
AP

Germany's book industry association is calling for tougher action against pirated copies of e-books, as publishers and agents gather for the Frankfurt Book Fair.

Gottfried Honnefelder, head of the group that represents publishers and booksellers, said at the fair's opening news conference that around 60 percent of e-book downloads in Germany are pirated through Internet sources such as filesharing sites.

The e-book market remains tiny in Germany, with about 0.5 percent of the market. E-readers have not caught on as they have in the U.S.

Some 7,400 exhibitors are expected for the fair Wednesday through Sunday. It's a forum for trading in publishing and translation rights.

Iceland is this year's featured guest, with some 35 writers presenting their works.
http://www.google.com/hostednews/ap/...d3b5cfcbb5e1a6





Jail Sentence for Pirate Bay Co-Founder Made Final
Ernesto

The Stockholm District Court sentence against Pirate Bay founder Gottfrid Svartholm was finalized today after he failed to appear at the Court of Appeal. Svartholm, also known as Anakata online, did not appear at the appeal trial last year because he was hospitalized in Cambodia and later went missing. The Court of Appeal has now decided to finalize the initial verdict of one year jail time and a fine of $1.1 million.

November last year, the Swedish Appeal Court found three people behind The Pirate Bay guilty of contributory copyright infringement offenses. The trio were handed prison sentences and ordered to pay millions of dollars in damages.

One of the defendants in the original trial, Pirate Bay co-founder Gottfrid Svartholm, was not included in the verdict because he was absent from the court hearings due to medical circumstances. The Court of Appeal decided to schedule a separate hearing for him to take place at a later date.

However, setting a new date was proving difficult since Svartholm’s location could not be determined, not even by his lawyer Ola Salmonsson. The lawyer asked for the case to continue without his client present, but entertainment industry representatives demanded that the earlier District Court “guilty” verdict should be made final.

The Court of Appeal eventually decided to schedule a hearing last month, which continued without the defendant being present.

Today the Court announced that due to Svartholm’s failure to appear, the District Court’s ruling of 2009 against him will be made permanent. This means that the Pirate Bay co-founder is sentenced to a year in jail and his share of 30 million kronor ($4.48m) in damages.

This verdict stands and can no longer be appealed.

Peter Sunde, one of the three remaining defendants, told TorrentFreak that he is appalled by how the court handled this case.

“I think it’s kind of strange putting a guy into jail because he’s too sick to appear in court,” Sunde says. “Also, nobody is in contact with him, for all we know he might be dead since no-one can reach him.”

“This is actually a really bizarre step from the Swedish court – he’s found guilty because he can’t defend himself. Way to go, democracy. It will be interesting to see how they will actually try to find him and put him into jail. If he’s not alive – will they put his gravestone into a jail cell for a year?”

Sunde and the two other remaining defendants have decided to take their case to the Supreme Court. There they hope for a final decision in their favor, which Sunde is convinced will happen.

“In the end, we’ll win. I’m certain of that. It’s just that we don’t have the same lobby power as these groups we’re fighting. But the law is on our side, however what we’ve learned is that having the legal right is not the same as winning in court.”

“It all depends on who’s paying the judges,” Sunde concludes.
https://torrentfreak.com/jail-senten...-final-111014/





Govt Proposes “Streamlined” Piracy Controls
Renai LeMay

The Federal Government has proposed to modify federal regulations to make it easier for anti-piracy organisations to request details of alleged Internet pirates from ISPs, in a modified process which would make it easier for organisations such as Movie Rights Group and AFACT to pursue individuals allegedly illegally downloading content online.

The details of the proposal are contained in a discussion paper released by Federal Attorney-General Robert McClelland this morning (PDF). The paper primarily discusses a change to legislation that would widen so-called Safe Harbour rules protecting organisations such as ISPs from the actions of their users.

However, a second section deals with what the Department of the Attorney-General described as “streamlining” the process whereby content owners could seek ISP subscriber details in copyright infringement matters.

“Widespread unauthorised downloading and use of file-sharing applications has made it increasingly difficult for copyright owners to successfully commercialise their property in the digital environment,” the paper states. “The difficulty of identifying persons engaged in infringing activities has also made it very difficult for copyright owners to protect and enforce their rights.”

The paper acknowledged Federal Court rules currently contained a general discovery procedure which could enable a copyright holder to obtain the details of a potential infringer from an ISP. This is the process which a new company, Movie Rights Group, has proposed in its current action to seek the details of some 9,000 Australians it alleges have illegally downloaded the film Kill the Irishman.

Movie Rights Group is also planning to target other alleged infringers over other films.

However, the paper stated, the process had been criticised as “cumbersome and expensive in the case of multiple online infringers”.

“There may be advantages in considering whether it is desirable to adopt a more streamlined procedure for copyright owners to identify ISP subscribers who engage in online copyright infringement,” it added.

The paper noted that any “streamlined” process would require judicial oversight, as well as taking into account the legal obligations of ISPs under both the Privacy Act and the Telecommunications Act — with a Federal Court Judge or Magistrate being required to issue an order authorising an ISP to provide details of a particular subscriber to a copyright owner — once sufficient detail had been provided (an IP address, the copyrighted material, the dates the alleged downloading had occurred and so on).

Cases in the US have shown that, once those details have been obtained, the copyright owner will often issue a letter to the alleged infringers, requesting they settle the copyright owner’s legal claim on the matter, or face legal action. It is believed that this is the approach which Movie Rights Group will take in Australia.

Attorney-General Robert McClelland revealed the discussion paper in a speech this morning to the Copyright Symposium, an event held by the Australian Copyright Council, an organisation which counts among its members Australian publishers across multiple categories — books, newspapers, film, music and more.

The full text of McClelland’s speech is available online. In it, the Attorney-General stated that “one of the most significant challenges” for copyright industries was “illegal file sharing and downloading”. McClelland highlighted two recent reports published by the Australian Federation Against Copyright Theft, and the newly formed Australian Content Industry Group, to illustrate the issue.

“Both reports outline economic harm caused by piracy which includes, GDP loss, jobs foregone and tax losses,” McClelland stated.

The politician also referred to the recent closed door talks between the ISP industry and the content industry over the issue. “This preliminary discussion was very successful with industry bringing many innovative ideas to the table,” said McClelland. “The Government intends to continue this discussion with key copyright and internet service provider stakeholders to further build on the progress that has been made.”

“I note that an agreement was recently reached in the United States between creative industries and internet service providers, whereby internet service providers will send out notices to users who are found to be distributing infringing material online. I am optimistic that collaborative approaches to online copyright infringement can also be implemented in Australia.”

“As the Greek Philosopher Heraclitus said, “Nothing endures but change.” The ongoing success of Australia’s copyright industries depends upon our ability to adapt to change and strike the appropriate balance between providing incentives for creators and opportunities for the market.”
http://delimiter.com.au/2011/10/14/g...racy-controls/





U.S. Copyright Czar Cozied Up to Content Industry, E-Mails Show
David Kravets

Top-ranking Obama administration officials, including the U.S. copyright czar, played an active role in secret negotiations between Hollywood, the recording industry and ISPs to disrupt internet access for users suspected of violating copyright law, according to internal White House e-mails.

The e-mails, obtained via the Freedom of Information Act, (.pdf) show the administration’s cozy relationship with Hollywood and the music industry’s lobbying arms and its early support for the copyright-violation crackdown system publicly announced in July.

One top official even used her personal e-mail account at least once in the course of communicating during the negotiations with executives and lobbyists from companies ranging from AT&T to Universal Music.

Internet security and privacy researcher Christopher Soghoian obtained the e-mails via a government sunshine request for them filed in June, and provided them to Wired. The e-mails are embedded at the end of this story.

The records show the government clearly had a voice in the closed-door negotiations, though it was not a signatory to the historic accord, which isn’t an actual government policy.

The agreement includes participation by the U.S.’s largest consumer internet providers including AT&T, Cablevision, Comcast, Time Warner and Verizon. It requires internet service providers, for the first time, to punish residential internet-service customers who media companies suspect are violating copyright rules by downloading copyrighted movies or music from peer-to-peer networks.

Those so-called “mitigation measures” lobbied for by the record labels and Hollywood include reducing internet speeds and redirecting a subscriber’s service to an “educational” landing page for customers accused of copyright infringement. Internet providers may eliminate service altogether for people repeatedly accused of copyright infringement under what the deal calls “graduated response.”

The e-mails do not entail much detail of the discussions between the administration and industry — as any substantive text in the e-mails was blacked out before being released to Soghoian.

But the communications show that a wide range of officials — from Vice President Joe Biden’s deputy chief of staff Alan Hoffman, the Justice Department’s criminal chief Lanny Breuer to copyright czar Victoria Espinel — were in the loop well ahead of the accord’s unveiling.

“These kind of backroom voluntary deals are quite scary, particularly because they are not subject to judicial review. I wanted to find out what role the White House has played in the negotiation, but unfortunately, the OMB (Office of Management and Budget) withheld key documents that would shed further light on it,” Soghoian said when asked why he sought the documents. He is appealing to OMB to disclose more e-mails.

The e-mails, some of which had the subject line “counteroffer,” show off what seems to be a cordial and friendly two-way relationship between industry and the administration.

Alec French, NBC’s top lobbyist, sent copyright czar Espinel an e-mail from his Blackberry in January of last year, asking if she was “available for call this am?”

She promptly replied: “Btw, i only check my gmail intermittently now so much quicker to reach me on omb email,” referrring to her work e-mail address provided by the Office of Management and Budget. She said she was available for the call. Her personal e-mail address was redacted in the documents.

Espinel, whose position was created in 2008 as part of intellectual property reform legislation, declined in an e-mail to Wired to comment for this story. Instead, the President Barack Obama appointee referred Wired to the OMB press office. That office neither responded for comment nor replied to a follow-up e-mail.

Neil Turkewitz, the Recording Industry Association of America vice president, routinely sent messages advocating stringent piracy crackdown measures to dozens of government officials from a wide range of agencies, including the Commerce, Treasury, State, Justice and Homeland Security departments.

Digital rights groups were barely visible in the messages the government provided to Soghoian, an issue that was not lost on Espinel. In a December 2010 e-mail to Cary Sherman, the RIAA’s president, the copyright czar asks, “How are things going on putting together a rollout plan?”

She adds: “I was at Brookings this morning and CDT came up to ask me to please not have the graduated response announcement be a complete surprise but to have some outreach to stakeholders in advance,” the e-mail to Sherman said.

CDT is the Center for Democracy and Technology, a centrist digital rights group based in D.C.. David Sohn, CDT’s senior policy counsel, said in a telephone interview that the group participated in a “couple of meetings.”

“We weren’t there during the whole negotiating process,” Sohn said. “We did have an opportunity to provide some feedback.”

Months after the e-mail to Sherman, Espinel organized a meeting with CDT and Public Knowledge, another digital rights group. One of the required attendees was Aneesh Chopra, the government’s chief technology officer.

Art Brodsky, a spokesman for Public Knowledge, the only other consumer group believed to have had any input on the agreement, said in a telephone interview, “We were sort of consulted at the end.”

“But we were not an integral part of the process,” he added.

When the deal was announced, the public interest groups put out a joint statement, saying: “We believe it would be wrong for any ISP to cut off subscribers, even temporarily, based on allegations that have not been tested in court.”

All the while, the administration was sensitive that the existence of the accord remain out of public purview.

One e-mail showed that Biden’s office was concerned that CNET’s Greg Sandoval had broken the news of the deal weeks before it was publicly announced.

“So what is the plan? Monitor and respond if need be. We can be ready to move at a moment’s notice,” Hoffman, Biden’s deputy chief of staff, wrote to Espinel and Sherman in a June e-mail. The subject was “the leaked story.”

The RIAA’s Sherman promptly replied to Hoffman’s concerns: “That’s the plan exactly. Thanks for being prepared to move quickly if necessary.”

All in all, the e-mails — which contain redacted draft copies of the deal marked “Privileged and Confidential” — show that the government was on top of the negotiations, and actively sought input from industry.

In a December 2009 e-mail, Espinel thanked DeDe Lea, a Viacom vice president, for forwarding the talking points of Michael Lynton, the Sony Pictures chairman. (The talking points were redacted out.)

“Ok – thanks. And look forward to hearing back from you on that,” Espinel wrote Lea.

In August of last year, in an e-mail to Randal Milch, Verizon’s lead counsel, Espinel said she and Hoffman “were hoping we could meet sometime this week or next,” to discuss the plan.

Milch replied: “Next week would be doable, I hope.”

Espinel had organized a meeting last year between Hoffman, Sherman, herself, NBC general counsel Rick Cotton and Michael O’Leary, the Motion Picture Association of America’s top lobbyist, according to a September 2010 e-mail. Next to O’Leary’s name on the e-mail invite was “Today is his birthday” in parenthesis.

Terms of the brokered deal include: On an internet subscriber’s first reported copyright offense, internet subscribers will receive an e-mail “alert” from their ISP saying the account “may have been” misused for online content theft. On the second reported offense, the alert might contain an “educational message” about the legalities of online file sharing.

On the third and fourth reported infractions, the subscriber will likely receive a pop-up notice “asking the subscriber to acknowledge receipt of the alert.”

After four alerts, according to the program, “mitigation measures” may commence. They include “temporary reductions of internet speeds, redirection to a landing page until the subscriber contacts the ISP to discuss the matter or reviews and responds to some educational information about copyright, or other measures (as specified in published policies) that the ISP may deem necessary to help resolve the matter.”

The content industry monitors peer-to-peer networks for infringement and informs ISPs of the IP addresses of alleged copyright scofflaws. ISPs then check which subscriber account the IP address was assigned to at the time of the alleged infringement and sends a notice of the allegation to the account holder.

An internet subscriber could get such notices without having engaged in illegal downloading if others have used their connection or if the monitoring company makes a mistake.

The RIAA, which includes Universal Music Group Recordings, Warner Music Group, Sony Music Entertainment and EMI Music North America, kicked off the negotiations with ISPs in December 2008, when it abruptly stopped a litigation campaign which included some 30,000 lawsuits targeting individual file sharers. The RIAA and the MPAA wanted ISPs to monitor Americans’ internet usage for copyright infringement, but the agreement does not include any provisions for that.

One Turkewitz e-mail was addressed to about 50 government employees. It appeared to pirate a blog post from Canadian lawyer Barry Sookman, who had analyzed an Irish court decision on internet piracy. The entire 3,200 word article is included in the e-mail.

Turkewitz, the RIAA vice president, told Wired he “had Barry’s permission to forward his piece.”

Sookman did not respond to a request for comment.
http://www.wired.com/threatlevel/201...zar-cozies-up/





US Senator Demands Congressional Oversight of ACTA
Rich Fiscus

US Senator demands congressional oversight of ACTA Senator Ron Wyden has sent a letter to President Obama protesting the signing of the Anti-Counterfeiting Trade Agreement (ACTA) as an executive agreement.

The secretly negotiated intellectual property agreement was signed by representatives of 8 countries, including the United States, on October 1. A few parties to the negotations, including the European Union, have yet to add their signatures.

In his letter, Wyden accuses the president of overstepping his authority by entering into an agreement which covers international trade and intellectual property. He explains that authority for both are explicitly assigned to Congress by the US Constitution.

His criticism also extends to the office of the US Trade Representative (USTR), who negotiated ACTA on behalf of the US, for misleading statements about its legality.

He wrote:

The USTR long asserts authority to enter ACTA as a "sole executive agreement" with no congressional authorization or approval. In its latest explanation on this topic, the ISTR stated:

ACTA is consistent with U.S. law and does not require the enactment of implementing legislation. The United States may therefore enter into and carry out the requirements of the Agreement under existing legal authority, just as it has done with other trade agreements.

This statement by the USTR confuses the issue by conflating two separate stages of the process required for binding the U.S. to international agreements: entry and implementation. It may be possible for the U.S. to implement ACTA or any other trade agreement, once validly entered, without legislation if the agreement requires no change in U.S. law. But, regardless of whether the agreement requires changes in U.S. law, a point that is contested with respect to ACTA, the executive branch lacks constitutional authority to enter a binding international agreement covering issues delegated by the Constitution to Congress' authority, absent congressional approval.


Besides the statement cited by Wyden, the USTR has also refused to disclose details of ACTA negotiations to the public, citing national security concerns. Exactly what national security issues are at stake have been explained.

If the president declines to submit ACTA for Senate ratification, Wyden is requesting he make an official statement clarifying that no portion of the agreement is legally binding on the United States.

He points out that the traditions of international law do not necessarily recognize the internal ratification processes of individual countries:

According to many international law scholars, customary international law recognizes the ability of the chief executive of a country to bind its nation to an international agreement regardless of domestic legal requirements.

I request that as a condition of the U.S. putting forward any official instrument that accepts the terms of ACTA that you formally declare that ACTA does not create any international obligations for the U.S. - that ACTA is not binding. If you are unwilling or unable to make such a clarification, it is imperative that your administration provide the Congress, and the public, with a legal rationale for why ACTA should not be considered by the Congress, and work with us to ensure that we reach a common understanding of the proper way for the U.S. to proceed with ACTA.


Of course, President Obama is unlikely to take either option. ACTA has been handled as a treaty by every country involved besides the U.S. and is obviously intended to mandate changes to the law.

If the United States were to back out, either through failing to ratify ACTA as a treaty or an executive statement nullifying its authority, the entire agreement would likely fall apart. The real question is what sort of formal legal challenge will be mounted, and by whom.
http://www.afterdawn.com/news/articl...rsight_of_acta





'Piracy Treaty' Targets File Sharing and Cloud Storage

The multi-lateral Anti-Counterfeiting Trade Agreement (ACTA), or 'Piracy Treaty' - signed by most of the Allied Powers recently - is now public knowledge and open for debate, says an analysis on the Stellenbosch University's Intellectual Property blog, IPStell.

It notes that according to its preamble, the treaty aims to combat the 'proliferation of counterfeit and pirated goods, as well as of services that distribute infringing material, undermines legitimate trade and sustainable development of the world economy, causes significant financial losses for right holders and for legitimate businesses, and ... provides a source of revenue for organised crime'.

It notes that as it is 'drafted in a very clear, transparent and often direct manner, ACTA contains several provisions for the speedy, procedure-free enforcement of IP rights'. These include the rights to seize and detain any shipment of goods under the suspicion that it may contain infringing goods; allow customs officials to examine the content of personal computers under the suspicion that it may contain counterfeit or pirated goods; allow the competent national authority (customs) to destroy any infringing goods; and allow for the imposition of 'administrative penalties' following any infringement.

According to the analysis, the treaty requires every signatory 'to implement sufficient technological measures to prevent the unauthorised disclosure or dissemination of protected work by means of a digital network'. It points out that the treaty 'envisions the highest level of control over peer-to-peer file sharing services and cloud storage.'
http://www.legalbrief.co.za/article....11014082321550





A Game We All Win: Dumping DRM Can Increase Sales While Reducing Piracy
Matthew Lasar

The standard line that Digital Rights Management (DRM) functions as a bulwark against online music piracy is being challenged by a trio of economists from Rice and Duke Universities. Their game theory research sides with a growing sentiment that DRM technologies which restrict music file copying and moving sometimes encourage illegal file sharing instead.

"In many cases, DRM restrictions prevent legal users from doing something as normal as making backup copies of their music," contends one of the researchers, Dinahy Vernik, assistant professor of marketing at Rice's Jones Graduate School of Business. "Because of these inconveniences, some consumers choose to pirate."

The paper in question is titled "Music Downloads and the Flip Side of Digital Rights Management Protection."

Under certain conditions, "we find that eliminating DRM restrictions can lead to an increase in sales of legal downloads, a decrease in sales of traditional CDs, and a decrease in piracy," conclude marketing scholars Vernik and Devavrat Purohit and Preyas Desai of Duke. "This is in stark contrast to the view that removing DRM will unconditionally increase the level of piracy."

Pure joy

To make this case, Vernik, Purohit, and Desai set up an economic game model based on the "Nash equilibrium" created by Nobel laureate economist John Forbes Nash. That system assumes the existence of an array of marketing strategies characterized by one property: no player benefits by altering her strategy while the other players stand pat on theirs.

From this point of departure, the economists establish a hypothetical environment in which there exists an album of music. It can be obtained in two formats: "traditional" (CDs) and "downloadable" (MP3 or AAC files). The scholars are interested in the latter format, and create a market timeline through which the music moves, either equipped with DRM or not.

First, they establish a base utility equation for the item, "which reflects the pure joy of listening to that particular album." But, they note, "consumers' net utility is affected by their preferences for format (traditional or downloadable), their cost of stealing, and the restrictions imposed by DRM."

And therein lies the rub. Faced with the choice of buying or pirating, music lovers will assess the costs differently. "A highly ethical consumer or a novice computer user will have a very high cost of pirating," the economists observe, "whereas a consumer who does not see piracy as stealing or an expert computer user will have a much lower 'pirating cost."

Thus, two "segments" are established for the game. In segment "H" (high) consumers face a "high moral pirating cost." In segment "L" (low) they perceive a "lower moral pirating cost." The game rules assume that "H" is high enough to discourage those consumers under its sway from obtaining pirated tunes. On the other hand, "some consumers in segment L may engage in piracy."

Let the game begin

The game then moves through three stages. In stage one, the record label chooses its formats. In stage two, retailers set their retail prices. In the final stage, "consumers maximize utility by choosing the optimal product available in the market."

That optimal product may come in the form of a download without DRM—that is, a file sold by Retailer D that they can copy or move at their convenience across various platforms. Or it may come with a DRM impediment, sold by Retailer T. "H segment" consumers will choose between these retailers. "L segment" buyers will choose between them and "stealing a digital copy from the Internet."

Having established these rules, the scholars plug in various economic formulas to review the fate of a series of propositions regarding the impact of DRM. These are arguments about the conditions under which DRM discourages or does not discourage illegal downloading.

Bottom line, they argue that eliminating DRM under various conditions reduces illegal downloading:

This conclusion stems from the idea that by introducing DRM-free music, the music label increases the downstream competition between the traditional format and legal downloads. Because DRM-free music is a stronger competitor for traditional CDs, it forces the prices of CDs to move down, which in turn lowers the legal download price. This competition between the traditional and download formats lowers prices such that some consumers move from stealing music to buying legal downloads. Thus, removing DRM can lower the level of piracy. Furthermore, we find that this result can occur even when consumers do not see any difference in the utility they derive from DRM-free and DRM-restricted products.

Thus, removing DRM represents a good deal for consumers in all segments of the market: "In particular, traditional consumers of CDs benefit from a lower price; consumers of legal downloads get higher utility with a DRM-free version even though the price of the legal version may increase; and, interestingly, consumers who obtain pirated versions benefit because it is easier to steal music when there is no DRM."

Rushed and buggy

Obviously, the content industry is not interested in helping consumers obtain pirated content under any circumstances. But as the authors note, the idea of DRM-free music has definitely taken on a life of its own, embraced by EMI, Universal, and Warner for some time. Ditto for Apple when it comes to music on iTunes.

The concept has also been reluctantly accepted by the game industry under certain conditions, such as EA's easing up of its install limit for Spore.

Not nearly often enough for many consumers. Thanks to DRM, "just sitting down and playing a game is getting harder and harder to do," we lamented six months ago. "Game publishers of all stripes are getting greedy, and putting out games that are rushed, buggy, deliberately incomplete, and addled by bone-headed DRM schemes that serve mainly to frustrate legit players."

The Rice/Duke paper notes that Spore's original DRM restrictions were so tough that TorrentFreak crowed that they "encouraged thousands to get their copy illegally."

"Attributing abnormally high piracy levels to DRM is consistent with the analysis in our paper," the marketing experts conclude.
http://arstechnica.com/tech-policy/n...ing-piracy.ars





Steve Jobs
Richard Stallman

Steve Jobs, the pioneer of the computer as a jail made cool, designed to sever fools from their freedom, has died.

As Chicago Mayor Harold Washington said of the corrupt former Mayor Daley, "I'm not glad he's dead, but I'm glad he's gone." Nobody deserves to have to die - not Jobs, not Mr. Bill, not even people guilty of bigger evils than theirs. But we all deserve the end of Jobs' malign influence on people's computing.

Unfortunately, that influence continues despite his absence. We can only hope his successors, as they attempt to carry on his legacy, will be less effective.
http://stallman.org/archives/2011-ju...8Steve_Jobs%29










“Secrets of the Little Blue Box”

The 1971 article about phone hacking that inspired Steve Jobs.

By Ron Rosenbaum

In 1971, Slate columnist Ron Rosenbaum wrote an article for Esquire about a loose confederation of proto-hackers who built devices—little blue boxes—that could crack phone networks. According the New York Times obituary of Apple founder Steve Jobs, after reading Rosenbaum’s article, Jobs and his partner in founding Apple, Steve Wozniak, “collaborated on building and selling blue boxes, devices that were widely used for making free—and illegal—phone calls. They raised a total of $6,000 from the effort.” The original 1971 article, “Secrets of the Little Blue Box,” is reprinted below, with permission from the author. It’s also available in Rosenbaum’s collection The Secret Parts of Fortune. Also in Slate: Rosenbaum reflects on the article that inspired Steve Jobs.

In Which We Explore the Web of the Original Hackers

There is an underground telephone network in this country. Al Gilbertson (I’ve changed his name) discovered it the day after his arrest for manufacturing illegal “blue boxes.” A crime he is not exactly repentant about. I am sitting in the living room of the creator of the blue box. Gilbertson is holding one of his shiny black-and-silver blue boxes comfortably in the palm of his hand, pointing out the thirteen little red push buttons sticking up from the console. He is dancing his fingers over the buttons, tapping out discordant beeping electronic jingles. He is trying to explain to me how his little blue box does nothing less than place the entire telephone system of the world, satellites, cables and all, at the service of the blue-box operator, free of charge.

“Essentially it gives you the power of a super operator. You seize a tandem with this top button," he presses the top button with his index finger and the blue box emits a high-pitched cheep, "and like that" — cheep goes the blue box again — "you control the phone company's long-distance switching systems from your cute little Princess phone or any old pay phone. And you've got anonymity. An operator has to operate from a definite location: The phone company knows where she is and what she's doing. But with your beeper box, once you hop onto a trunk, say from a Holiday Inn 800 number, they don't know where you are, or where you're coming from, they don't know how you slipped into their lines and popped up in that 800 number. They don't even know anything illegal is going on. And you can obscure your origins through as many levels as you like. You can call next door by way of White Plains, then over to Liverpool by cable, and then back here by satellite. You can call yourself from one pay phone all the way around the world to a pay phone next to you. And you get your dime back too."

"And they can't trace the calls? They can't charge you?"

"Not if you do it the right way. But you'll find that the free-call thing isn't really as exciting at first as the feeling of power you get from having one of these babies in your hand. I've watched people when they first get hold of one of these things and start using it, and discover they can make connections, set up crisscross and zigzag switching patterns back and forth across the world. They hardly talk to the people they finally reach. They say hello and start thinking of what kind of call to make next. They go a little crazy." He looks down at the neat little package in his palm. His fingers are still dancing, tapping out beeper patterns.

"I think it's something to do with how small my models are. There are lots of blue boxes around, but mine are the smallest and most sophisticated electronically. I wish I could show you the prototype we made for our big syndicate order."

He sighs. "We had this order for a thousand beeper boxes from a syndicate front man in Las Vegas. They use them to place bets coast to coast, keep lines open for hours, all of which can get expensive if you have to pay. The deal was a thousand blue boxes for $300 apiece. Before then we retailed them for $1,500 apiece, but $300,000 in one lump was hard to turn down. We had a manufacturing deal worked out in the Philippines. Everything ready to go. Anyway, the model I had ready for limited mass production was small enough to fit inside a flip-top Marlboro box. It had flush touch panels for a keyboard, rather than these unsightly buttons sticking out. Looked just like a tiny portable radio. In fact, I had designed it with a tiny transistor receiver to get one AM channel so in case the law became suspicious the owner could switch on the radio part, start snapping his fingers, and no one could tell anything illegal was going on. I thought of everything for this model — I had it lined with a band of thermite which could be ignited by radio signal from a tiny button transmitter on your belt, so it could be burned to ashes instantly in case of a bust. It was beautiful. A beautiful little machine. You should have seen the faces on these syndicate guys when they came back after trying it out. They'd hold it in their palm like they never wanted to let it go, and they'd say, 'I can't believe it. I can't believe it.' You probably won't believe it until you try it."

You Can Call Long Distance for Less Than You Think

"You see, a few years ago the phone company made one big mistake," Gilbertson explains two days later in his apartment. "They were careless enough to let some technical journal publish the actual frequencies used to create all their multi-frequency tones. Just a theoretical article some Bell Telephone Laboratories engineer was doing about switching theory, and he listed the tones in passing. At ----- [a well-known technical school] I had been fooling around with phones for several years before I came across a copy of the journal in the engineering library. I ran back to the lab and it took maybe twelve hours from the time I saw that article to put together the first working blue box. It was bigger and clumsier than this little baby, but it worked."

It's all there on public record in that technical journal written mainly by Bell Lab people for other telephone engineers. Or at least it was public. "Just try and get a copy of that issue at some engineering-school library now. Bell has had them all red-tagged and withdrawn from circulation," Gilbertson tells me.

"But it's too late. It's all public now. And once they became public the technology needed to create your own beeper device is within the range of any twelve-year-old kid, any twelve-year-old blind kid, as a matter of fact. And he can do it in less than the twelve hours it took us. Blind kids do it all the time. They can't build anything as precise and compact as my beeper box, but theirs can do anything mine can do."

"How?"

"Okay. About twenty years ago AT&T made a multibillion-dollar decision to operate its entire long-distance switching system on twelve electronically generated combinations of six master tones. Those are the tones you sometimes hear in the background after you've dialed a long-distance number. They decided to use some very simple tones — the tone for each number is just two fixed single-frequency tones played simultaneously to create a certain beat frequency. Like 1300 cycles per second and 900 cycles per second played together give you the tone for digit 5. Now, what some of these phone phreaks have done is get themselves access to an electric organ. Any cheap family home-entertainment organ. Since the frequencies are public knowledge now — one blind phone phreak has even had them recorded in one of those talking books for the blind — they just have to find the musical notes on the organ which correspond to the phone tones. Then they tape them. For instance, to get Ma Bell's tone for the number 1, you press down organ keys F5 and A5 [900 and 700 cycles per second] at the same time. To produce the tone for 2 it's F5 and C6 [1100 and 700 cps]. The phone phreaks circulate the whole list of notes so there's no trial and error anymore."

He shows me a list of the rest of the phone numbers and the two electric organ keys that produce them.

"Actually, you have to record these notes at 3¾ inches-per-second tape speed and double it to 7½ inches-per-second when you play them back, to get the proper tones," he adds.

"So once you have all the tones recorded, how do you plug them into the phone system?"

"Well, they take their organ and their cassette recorder, and start banging out entire phone numbers in tones on the organ, including country codes, routing instructions, 'KP' and 'Start' tones. Or, if they don't have an organ, someone in the phone-phreak network sends them a cassette with all the tones recorded, with a voice saying 'Number one,' then you have the tone, 'Number two,' then the tone, and so on. So with two cassette recorders they can put together a series of phone numbers by switching back and forth from number to number. Any idiot in the country with a cheap cassette recorder can make all the free calls he wants."

"You mean you just hold the cassette recorder up the mouthpiece and switch in a series of beeps you've recorded? The phone thinks that anything that makes these tones must be its own equipment?"

"Right. As long as you get the frequency within thirty cycles per second of the phone company's tones, the phone equipment thinks it hears its own voice talking to it. The original granddaddy phone phreak was this blind kid with perfect pitch, Joe Engressia, who used to whistle into the phone. An operator could tell the difference between his whistle and the phone company's electronic tone generator, but the phone company's switching circuit can't tell them apart. The bigger the phone company gets and the further away from human operators it gets, the more vulnerable it becomes to all sorts of phone phreaking."

"What about the recent series of blue-box arrests all across the country — New York, Cleveland, and so on?" I asked. "How were they caught so easily?"

"From what I can tell, they made one big mistake: They were seizing trunks using an area code plus 555-1212 instead of an 800 number. Using 555 is easy to detect because when you send multifrequency beep tones off 555 you get a charge for it on your tape and the accounting computer knows there's something wrong when it tries to bill you for a two-hour call to Akron, Ohio, information, and it drops a trouble card which goes right into the hands of the security agent if they're looking for blue-box users.

"Whoever sold those guys their blue boxes didn't tell them how to use them properly, which is fairly irresponsible. And they were fairly stupid to use them at home all the time.

"But what those arrests really mean is that an awful lot of blue boxes are flooding into the country and that people are finding them so easy to make that they know how to make them before they know how to use them. Ma Bell is in trouble."

And if a blue-box operator or a cassette-recorder phone phreak sticks to pay phones and 800 numbers, the phone company can't stop them?

"Not unless they change their entire nationwide long-lines technology, which will take them a few billion dollars and twenty years. Right now they can't do a thing. They're screwed."

Captain Crunch Demonstrates His Famous Unit

Al Gilbertson discovered the underground telephone network the very day news of his activities hit the papers. That evening his phone began ringing. Phone phreaks from Seattle, from Florida, from New York, from San Jose, and from Los Angeles began calling him and telling him about the phone-phreak network. He'd get a call from a phone phreak who'd say nothing but, "Hang up and call this number."

When he dialed the number he'd find himself tied into a conference of a dozen phone phreaks arranged through a quirky switching station in British Columbia. They identified themselves as phone phreaks, they demonstrated their homemade blue boxes which they called "M-F-ers" (for "multi-frequency," among other things) for him, they talked shop about phone-phreak devices. They let him in on their secrets on the theory that if the phone company was after him he must be trustworthy. And, Gilbertson recalls, they stunned him with their technical sophistication.

I ask him how to get in touch with the phone-phreak network. He digs around through a file of old schematics and comes up with about a dozen numbers in three widely separated area codes.

"Those are the centers," he tells me. Alongside some of the numbers he writes in first names or nicknames: names like Captain Crunch, Dr. No, Frank Carson (also a code word for a free call), Marty Freeman (code word for M-F device), Peter Perpendicular Pimple, Alefnull, and The Cheshire Cat. He makes checks alongside the names of those among these top twelve who are blind. There are five checks.

I ask him who this Captain Crunch person is.

"Oh. The Captain. He's probably the most legendary phone phreak. He calls himself Captain Crunch after the notorious Cap'n Crunch 2600 whistle." (Several years ago, Gilbertson explains, the makers of Cap'n Crunch breakfast cereal offered a toy-whistle prize in every box as a treat for the Cap'n Crunch set. Somehow a phone phreak discovered that the toy whistle just happened to produce a perfect 2600-cycle tone. When the man who calls himself Captain Crunch was transferred overseas to England with his Air Force unit, he would receive scores of calls from his friends and "mute" them — make them free of charge to them — by blowing his Cap'n Crunch whistle into his end.)

"Captain Crunch is one of the older phone phreaks," Gilbertson tells me. "He's an engineer who once got in a little trouble for fooling around with the phone, but he can't stop. Well, this guy drives across country in a Volkswagen van with an entire switchboard and a computerized super-sophisticated M-F-er in the back. He'll pull up to a phone booth on a lonely highway somewhere, snake a cable out of his bus, hook it onto the phone and sit for hours, days sometimes, sending calls zipping back and forth across the country, all over the world...."

Back at my motel, I dialed the number he gave me for "Captain Crunch" and asked for G---- T-----, his real name, or at least the name he uses when he's not dashing into a phone booth beeping out M-F tones faster than a speeding bullet, and zipping phantomlike through the phone company's long-distance lines.

When G---- T----- answered the phone and I told him I was preparing a story for Esquire about phone phreaks, he became very indignant.

"I don't do that. I don't do that anymore at all. And if I do it, I do it for one reason and one reason only. I'm learning about a system. The phone company is a System. A computer is a System. Do you understand? If I do what I do, it is only to explore a System. Computers. Systems. That's my bag. The phone company is nothing but a computer."

A tone of tightly restrained excitement enters the Captain's voice when he starts talking about Systems. He begins to pronounce each syllable with the hushed deliberation of an obscene caller.

"Ma Bell is a system I want to explore. It's a beautiful system, you know, but Ma Bell screwed up. It's terrible because Ma Bell is such a beautiful system, but she screwed up. I learned how she screwed up from a couple of blind kids who wanted me to build a device. A certain device. They said it could make free calls. I wasn't interested in free calls. But when these blind kids told me I could make calls into a computer, my eyes lit up. I wanted to learn about computers. I wanted to learn about Ma Bell's computers. So I built the little device. Only I built it wrong and Ma Bell found out. Ma Bell can detect things like that. Ma Bell knows. So I'm strictly out of it now. I don't do it. Except for learning purposes." He pauses. "So you want to write an article. Are you paying for this call? Hang up and call this number."

He gives me a number in an area code a thousand miles north of his own. I dial the number.

"Hello again. This is Captain Crunch. You are speaking to me on a toll-free loop-around in Portland, Oregon. Do you know what a toll-free loop around is? I'll tell you."

He explains to me that almost every exchange in the country has open test numbers which allow other exchanges to test their connections with it. Most of these numbers occur in consecutive pairs, such as 302 956-0041 and 956-0042. Well, certain phone phreaks discovered that if two people from anywhere in the country dial those two consecutive numbers they can talk together just as if one had called the other's number, with no charge to either of them, of course.

"Your voice is looping around in a 4A switching machine up there in Canada, zipping back down to me," the Captain tells me. "My voice is looping around up there and back down to you. And it can't ever cost anyone money. The phone phreaks and I have compiled a list of many many of these numbers. You would be surprised if you saw the list. I could show it to you. But I won't. I'm out of that now. I'm not out to screw Ma Bell. I know better. If I do anything it's for the pure knowledge of the System. You can learn to do fantastic things. Have you ever heard eight tandems stacked up? Do you know the sound of tandems stacking and unstacking? Give me your phone number. Okay. Hang up now and wait a minute."

Slightly less than a minute later the phone rang and the Captain was on the line, his voice sounding far more excited, almost aroused.

"I wanted to show you what it's like to stack up tandems. To stack up tandems." (Whenever the Captain says "stack up" it sounds as if he is licking his lips.)

"How do you like the connection you're on now?" the Captain asks me. "It's a raw tandem. A raw tandem. Ain't nothin' up to it but a tandem. Now I'm going to show you what it's like to stack up. Blow off. Land in a far away place. To stack that tandem up, whip back and forth across the country a few times, then shoot on up to Moscow.

"Listen," Captain Crunch continues. "Listen. I've got a line tie on my switchboard here, and I'm gonna let you hear me stack and unstack tandems. Listen to this. It's gonna blow your mind."

First I hear a super rapid-fire pulsing of the flutelike phone tones, then a pause, then another popping burst of tones, then another, then another. Each burst is followed by a beep-kachink sound.

"We have now stacked up four tandems," said Captain Crunch, sounding somewhat remote. "That's four tandems stacked up. Do you know what that means? That means I'm whipping back and forth, back and forth twice, across the country, before coming to you. I've been known to stack up twenty tandems at a time. Now, just like I said, I'm going to shoot up to Moscow."

There is a new, longer series of beeper pulses over the line, a brief silence, then a ring.

"Hello," answers a far-off voice.

"Hello. Is this the American Embassy Moscow?"

"Yes, sir. Who is this calling?" says the voice.

"Yes. This is test board here in New York. We're calling to check out the circuits, see what kind of lines you've got. Everything okay there in Moscow?"

"Okay?"

"Well, yes, how are things there?"

"Oh. Well, everything's okay, I guess."

"Okay. Thank you." They hang up, leaving a confused series of beep-kachink sounds hanging in mid-ether in the wake of the call before dissolving away.

The Captain is pleased. "You believe me now, don't you? Do you know what I'd like to do? I'd like to call up your editor at Esquire and show him just what it sounds like to stack and unstack tandems. I'll give him a show that will blow his mind. What's his number?"

I ask the Captain what kind of device he was using to accomplish all his feats. The Captain is pleased at the question.

"You could tell it was special, couldn't you? Ten pulses per second. That's faster than the phone company's equipment. Believe me, this unit is the most famous unit in the country. There is no other unit like it. Believe me."

"Yes, I've heard about it. Some other phone phreaks have told me about it."

"They have been referring to my, ahem, unit? What is it they said? Just out of curiosity, did they tell you it was a highly sophisticated computer-operated unit, with acoustical coupling for receiving outputs and a switch-board with multiple-line capability? Did they tell you that the frequency tolerance is guaranteed to be not more than .05 percent? The amplitude tolerance less than .01 decibel? Those pulses you heard were perfect. They just come faster than the phone company. Those were high-precision op-amps. Op-amps are instrumentation amplifiers designed for ultra-stable amplification, super-low distortion, and accurate frequency response. Did they tell you it can operate in temperatures from minus 55 degrees centigrade to plus 125 degrees centigrade?"
I admit that they did not tell me all that.

"I built it myself," the Captain goes on. "If you were to go out and buy the components from an industrial wholesaler it would cost you at least $1,500. I once worked for a semiconductor company and all this didn't cost me a cent. Do you know what I mean? Did they tell you about how I put a call completely around the world? I'll tell you how I did it. I M-F-ed Tokyo inward, who connected me to India, India connected me to Greece, Greece connected me to Pretoria, South Africa, South Africa connected me to South America, I went from South America to London, I had a London operator connect me to a New York operator, I had New York connect me to a California operator, who rang the phone next to me. Needless to say I had to shout to hear myself. But the echo was far out. Fantastic. Delayed. It was delayed twenty seconds, but I could hear myself talk to myself."

"You mean you were speaking into the mouthpiece of one phone sending your voice around the world into your ear through a phone on the other side of your head?" I asked the Captain. I had a vision of something vaguely autoerotic going on, in a complex electronic way.

"That's right," said the Captain. "I've also sent my voice around the world one way, going east on one phone, and going west on the other, going through cable one way, satellite the other, coming back together at the same time, ringing the two phones simultaneously and picking them up and whipping my voice both ways around the world back to me. Wow. That was a mind blower."

"You mean you sit there with both phones on your ear and talk to yourself around the world," I said incredulously.

"Yeah. Um hum. That's what I do. I connect the phones together and sit there and talk."

"What do you say? What do you say to yourself when you're connected?"

"Oh, you know. Hello test one two three," he says in a low-pitched voice.

"Hello test one two three," he replied to himself in a high-pitched voice.

"Hello test one two three," he repeats again, low-pitched.

"Hello test one two three," he replies, high-pitched.

"I sometimes do this: Hello hello hello hello, hello, hello," he trails off and breaks into laughter.

Why Captain Crunch Hardly Ever Taps Phones Anymore

Using internal phone-company codes, phone phreaks have learned a simple method for tapping phones. Phone-company operators have in front of them a board that holds verification jacks. It allows them to plug into conversations in case of emergency, to listen in to a line to determine if the line is busy or the circuits are busy. Phone phreaks have learned to beep out the codes which lead them to a verification operator, tell the verification operator they are switchmen from some other area code testing out verification trunks. Once the operator hooks them into the verification trunk, they disappear into the board for all practical purposes, slip unnoticed into any one of the 10,000 to 100,000 numbers in that central office without the verification operator knowing what they're doing, and of course without the two parties to the connection knowing there is a phantom listener present on their line.

Toward the end of my hour-long first conversation with him, I asked the Captain if he ever tapped phones.

"Oh no. I don't do that. I don't think it's right," he told me firmly. "I have the power to do it but I don't... Well one time, just one time, I have to admit that I did. There was this girl, Linda, and I wanted to find out... you know. I tried to call her up for a date. I had a date with her the last weekend and I thought she liked me. I called her up, man, and her line was busy, and I kept calling and it was still busy. Well, I had just learned about this system of jumping into lines and I said to myself, 'Hmmm. Why not just see if it works. It'll surprise her if all of a sudden I should pop up on her line. It'll impress her, if anything.' So I went ahead and did it. I M-F-ed into the line. My M-F-er is powerful enough when patched directly into the mouthpiece to trigger a verification trunk without using an operator the way the other phone phreaks have to.

"I slipped into the line and there she was talking to another boyfriend. Making sweet talk to him. I didn't make a sound because I was so disgusted. So I waited there for her to hang up, listening to her making sweet talk to the other guy. You know. So as soon as she hung up I instantly M-F-ed her up and all I said was, 'Linda, we're through.' And I hung up. And it blew her head off. She couldn't figure out what the hell happened.

"But that was the only time. I did it thinking I would surprise her, impress her. Those were all my intentions were, and well, it really kind of hurt me pretty badly, and... and ever since then I don't go into verification trunks."

Moments later my first conversation with the Captain comes to a close.

"Listen," he says, his spirits somewhat cheered, "listen. What you are going to hear when I hang up is the sound of tandems unstacking. Layer after layer of tandems unstacking until there's nothing left of the stack, until it melts away into nothing. Cheep, cheep, cheep, cheep," he concludes, his voice descending to a whisper with each cheep.

He hangs up. The phone suddenly goes into four spasms: kachink cheep. Kachink cheep kachink cheep kachink cheep, and the complex connection has wiped itself out like the Cheshire cat's smile.

The MF Boogie Blues

The next number I choose from the select list of phone-phreak illuminati, prepared for me by the blue-box inventor is a Memphis number. It is the number of Joe Engressia, the first and still perhaps the most accomplished blind phone phreak.

Three years ago Engressia was a nine-day wonder in newspapers and magazines all over America because he had been discovered whistling free long-distance connections for fellow students at the University of South Florida. Engressia was born with perfect pitch; he could whistle phone tones better than the phone-company's equipment.

Engressia might have gone on whistling in the dark for a few friends for the rest of his life if the phone company hadn't decided to expose him. He was warned, disciplined by the college, and the whole case became public. In the months following media reports of his talent, Engressia began receiving strange calls. There were calls from a group of kids in Los Angeles who could do some very strange things with the quirky General Telephone and Electronics circuitry in L.A. suburbs. There were calls from a group of mostly blind kids in ----, California, who had been doing some interesting experiments with Cap'n Crunch whistles and test loops. There was a group in Seattle, a group in Cambridge, Massachusetts, a few from New York, a few scattered across the country. Some of them had already equipped themselves with cassette and electronic M-F devices. For some of these groups, it was the first time they knew of the others.

The exposure of Engressia was the catalyst that linked the separate phone-phreak centers together. They all called Engressia. They talked to him about what he was doing and what they were doing. And then he told them — the scattered regional centers and lonely independent phone phreakers — about each other, gave them each other's numbers to call, and within a year the scattered phone-phreak centers had grown into a nationwide underground.

Joe Engressia is only twenty-two years old now, but along the phone-phreak network he is "the old man," accorded by phone phreaks something of the reverence the phone company bestows on Alexander Graham Bell. He seldom needs to make calls anymore. The phone phreaks all call him and let him know what new tricks, new codes, new techniques they have learned. Every night he sits like a sightless spider in his little apartment receiving messages from every tendril of his web. It is almost a point of pride with Joe that they call him.

But when I reached him in his Memphis apartment that night, Joe Engressia was lonely, jumpy and upset.

"God, I'm glad somebody called. I don't know why tonight of all nights I don't get any calls. This guy around here got drunk again tonight and propositioned me again. I keep telling him we'll never see eye to eye on this subject, if you know what I mean. I try to make light of it, you know, but he doesn't get it. I can hear him out there getting drunker and I don't know what he'll do next. It's just that I'm really all alone here. I just moved to Memphis, it's the first time I'm living out on my own, and I'd hate for it to all collapse now. But I won't go to bed with him. I'm just not very interested in sex and even if I can't see him I know he's ugly.

"Did you hear that? That's him banging a bottle against the wall outside. He's nice. Well forget about it. You're doing a story on phone phreaks? Listen to this. It's the M F Boogie blues."

Sure enough, a jumpy version of “Muskrat Ramble” boogies its way over the line, each note one of those long-distance phone tones. The music stops. A huge roaring voice blasts the phone off my ear: "AND THE QUESTION IS..." roars the voice, "CAN A BLIND PERSON HOOK UP AN AMPLIFIER ON HIS OWN?"

The roar ceases. A high-pitched operator-type voice replaces it. "This is Southern Braille Tel. & Tel. Have tone, will phone."

This is succeeded by a quick series of M-F tones, a swift "kachink" and a deep reassuring voice: "If you need home care, call the visiting-nurses association. First National time in Honolulu is four thirty-two p.m."

Joe back in his Joe voice again: "Are we seeing eye to eye? 'Sí, sí,' said the blind Mexican. Ahem. Yes. Would you like to know the weather in Tokyo?"

This swift manic sequence of phone-phreak vaudeville stunts and blind-boy jokes manages to keep Joe's mind off his tormentor only as long as it lasts.

"The reason I'm in Memphis, the reason I have to depend on that homosexual guy, is that this is the first time I've been able to live on my own and make phone trips on my own. I've been banned from all central offices around home in Florida, they knew me too well, and at the University some of my fellow scholars were always harassing me because I was on the dorm pay phone all the time and making fun of me because of my fat ass, which of course I do have, it's my physical fatness program, but I don't like to hear it every day, and if I can't phone trip and I can't phone phreak, I can't imagine what I'd do, I've been devoting three quarters of my life to it.

"I moved to Memphis because I wanted to be on my own as well as because it has a Number 5 crossbar switching system and some interesting little independent phone-company districts nearby and so far they don't seem to know who I am so I can go on phone tripping, and for me phone tripping is just as important as phone phreaking."

Phone tripping, Joe explains, begins with calling up a central-office switch room. He tells the switchman in a polite earnest voice that he's a blind college student interested in telephones, and could he perhaps have a guided tour of the switching station? Each step of the tour Joe likes to touch and feel relays, caress switching circuits, switchboards, crossbar arrangements.

So when Joe Engressia phone phreaks he feels his way through the circuitry of the country garden of forking paths, he feels switches shift, relays shunt, crossbars swivel, tandems engage and disengage even as he hears — with perfect pitch — his M-F pulses make the entire Bell system dance to his tune.

Just one month ago Joe took all his savings out of his bank and left home, over the emotional protests of his mother. "I ran away from home almost," he likes to say. Joe found a small apartment house on Union Avenue and began making phone trips. He'd take a bus a hundred miles south into Mississippi to “see” some old-fashioned Bell equipment still in use in several states, which had been puzzling him. He'd take a bus three hundred miles to Charlotte, North Carolina, to get a feel for some brand-new experimental equipment. He hired a taxi to drive him twelve miles to a suburb to tour the office of a small phone company with some interesting idiosyncrasies in its routing system. He was having the time of his life, he said, the most freedom and pleasure he had known.

In that month he had done very little long-distance phone phreaking from his own phone. He had begun to apply for a job with the phone company, he told me, and he wanted to stay away from anything illegal.

"Any kind of job will do, anything as menial as the most lowly operator. That's probably all they'd give me because I'm blind. Even though I probably knew more than most switchmen. But that's okay. I want to work for Ma Bell. I don't hate Ma Bell the way Gilbertson and some phone phreaks do. I don't want to screw Ma Bell. With me it's the pleasure of pure knowledge. There's something beautiful about the system when you know it intimately the way I do. But I don't know how much they know about me here. I have a very intuitive feel for the condition of the line I'm on, and I think they're monitoring me off and on lately, but I haven't been doing much illegal. I have to make a few calls to switchmen once in a while which aren't strictly legal, and once I took an acid trip and was having these auditory hallucinations as if I were trapped and these planes were dive-bombing me, and all of sudden I had to phone phreak out of there. For some reason I had to call Kansas City, but that's all."

A Warning Is Delivered

At this point — one o'clock in my time zone — a loud knock on my motel-room door interrupts our conversation. Outside the door I find a uniformed security guard who informs me that there has been an "emergency phone call" for me while I have been on the line and that the front desk has sent him up to let me know.

Two seconds after I say good-bye to Joe and hang up, the phone rings.

"Who were you talking to?" the agitated voice demands. The voice belongs to Captain Crunch. "I called because I decided to warn you of something. I decided to warn you to be careful. I don't want this information you get to get to the radical underground. I don't want it to get into the wrong hands. What would you say if I told you it's possible for three phone phreaks to saturate the phone system of the nation? Saturate it. Busy it out. All of it. I know how to do this. I'm not gonna tell. A friend of mine has already saturated the trunks between Seattle and New York. He did it with a computerized M-F-er hitched into a special Manitoba exchange. But there are other, easier ways to do it."

Just three people? I ask. How is that possible?

"Have you ever heard of the long-lines guard frequency? Do you know about stacking tandems with 17 and 2600? Well, I'd advise you to find out about it. I'm not gonna tell you. But whatever you do, don't let this get into the hands of the radical underground."

(Later Gilbertson the inventor confessed that while he had always been skeptical about the Captain's claim of the sabotage potential of trunk-tying phone phreaks, he had recently heard certain demonstrations which convinced him the Captain was not speaking idly. "I think it might take more than three people, depending on how many machines like Captain Crunch's were available. But even though the Captain sounds a little weird, he generally turns out to know what he's talking about.")

"You know," Captain Crunch continues in his admonitory tone, "you know the younger phone phreaks call Moscow all the time. Suppose everybody were to call Moscow. I'm no right-winger. But I value my life. I don't want the Commies coming over and dropping a bomb on my head. That's why I say you've got to be careful about who gets this information."

The Captain suddenly shifts into a diatribe against those phone phreaks who don't like the phone company.

"They don't understand, but Ma Bell knows everything they do. Ma Bell knows. Listen, is this line hot? I just heard someone tap in. I'm not paranoid, but I can detect things like that. Well, even if it is, they know that I know that they know that I have a bulk eraser. I'm very clean." The Captain pauses, evidently torn between wanting to prove to the phone-company monitors that he does nothing illegal, and the desire to impress Ma Bell with his prowess. "Ma Bell knows the things I can do," he continues. "Ma Bell knows how good I am. And I am quite good. I can detect reversals, tandem switching, everything that goes on on a line. I have relative pitch now. Do you know what that means? My ears are a $20,000 piece of equipment. With my ears I can detect things they can't hear with their equipment. I've had employment problems. I've lost jobs. But I want to show Ma Bell how good I am. I don't want to screw her, I want to work for her. I want to do good for her. I want to help her get rid of her flaws and become perfect. That's my number-one goal in life now." The Captain concludes his warnings and tells me he has to be going. "I've got a little action lined up for tonight," he explains and hangs up.

Before I hang up for the night, I call Joe Engressia back. He reports that his tormentor has finally gone to sleep — "He's not blind drunk, that's the way I get, ahem, yes; but you might say he's in a drunken stupor." I make a date to visit Joe in Memphis in two days.

A Phone Phreak Cell Takes Care of Business

The next morning I attend a gathering of four phone phreaks in ----- (a California suburb). The gathering takes place in a comfortable split-level home in an upper-middle-class subdivision. Heaped on the kitchen table are the portable cassette recorders, M-F cassettes, phone patches, and line ties of the four phone phreaks present. On the kitchen counter next to the telephone is a shoe-box-size blue box with thirteen large toggle switches for the tones. The parents of the host phone phreak, Ralph, who is blind, stay in the living room with their sighted children. They are not sure exactly what Ralph and his friends do with the phone or if it's strictly legal, but he is blind and they are pleased he has a hobby which keeps him busy.

The group has been working at reestablishing the historic "2111" conference, reopening some toll-free loops, and trying to discover the dimensions of what seem to be new initiatives against phone phreaks by phone-company security agents.

It is not long before I get a chance to see, to hear, Randy at work. Randy is known among the phone phreaks as perhaps the finest con man in the game. Randy is blind. He is pale, soft and pear-shaped, he wears baggy pants and a wrinkly nylon white sport shirt, pushes his head forward from hunched shoulders somewhat like a turtle inching out of its shell. His eyes wander, crossing and recrossing, and his forehead is somewhat pimply. He is only sixteen years old.

But when Randy starts speaking into a telephone mouthpiece his voice becomes so stunningly authoritative it is necessary to look again to convince yourself it comes from a chubby adolescent Randy. Imagine the voice of a crack oil-rig foreman, a tough, sharp, weather-beaten Marlboro man of forty. Imagine the voice of a brilliant performance-fund gunslinger explaining how he beats the Dow Jones by thirty percent. Then imagine a voice that could make those two sound like Stepin Fetchit. That is sixteen-year-old Randy's voice.

He is speaking to a switchman in Detroit. The phone company in Detroit had closed up two toll-free loop pairs for no apparent reason, although heavy use by phone phreaks all over the country may have been detected. Randy is telling the switchman how to open up the loop and make it free again:

"How are you, buddy. Yeah. I'm on the board in here in Tulsa, Oklahoma, and we've been trying to run some tests on your loop-arounds and we find'em busied out on both sides.... Yeah, we've been getting a 'BY' on them, what d'ya say, can you drop cards on 'em? Do you have 08 on your number group? Oh that's okay, we've had this trouble before, we may have to go after the circuit. Here lemme give 'em to you: your frame is 05, vertical group 03, horizontal 5, vertical file 3. Yeah, we'll hang on here.... Okay, found it? Good. Right, yeah, we'd like to clear that busy out. Right. All you have to do is look for your key on the mounting plate, it's in your miscellaneous trunk frame. Okay? Right. Now pull your key from NOR over the LET. Yeah. I don't know why that happened, but we've been having trouble with that one. Okay. Thanks a lot fella. Be seein' ya."

Randy hangs up, reports that the switchman was a little inexperienced with the loop-around circuits on the miscellaneous trunk frame, but that the loop has been returned to its free-call status.

Delighted, phone phreak Ed returns the pair of numbers to the active-status column in his directory. Ed is a superb and painstaking researcher. With almost Talmudic thoroughness he will trace tendrils of hints through soft-wired mazes of intervening phone-company circuitry back through complex linkages of switching relays to find the location and identity of just one toll-free loop. He spends hours and hours, every day, doing this sort of thing. He has somehow compiled a directory of eight hundred "Band-six in-WATS numbers" located in over forty states. Band-six in-WATS numbers are the big 800 numbers — the ones that can be dialed into free from anywhere in the country.

Ed the researcher, a nineteen-year-old engineering student, is also a superb technician. He put together his own working blue box from scratch at age seventeen. (He is sighted.) This evening after distributing the latest issue of his in-WATS directory (which has been typed into Braille for the blind phone phreaks), he announces he has made a major new breakthrough:

"I finally tested it and it works, perfectly. I've got this switching matrix which converts any touch-tone phone into an M-F-er."

The tones you hear in touch-tone phones are not the M-F tones that operate the long-distance switching system. Phone phreaks believe AT&T had deliberately equipped touch tones with a different set of frequencies to avoid putting the six master M-F tones in the hands of every touch-tone owner. Ed's complex switching matrix puts the six master tones, in effect puts a blue box, in the hands of every touch-tone owner.

Ed shows me pages of schematics, specifications and parts lists. "It's not easy to build, but everything here is in the HeathKit catalog."

Ed asks Ralph what progress he has made in his attempts to reestablish a long-term open conference line for phone phreaks. The last big conference — the historic "2111" conference — had been arranged through an unused Telex test-board trunk somewhere in the innards of a 4A switching machine in Vancouver, Canada. For months phone phreaks could M-F their way into Vancouver, beep out 604 (the Vancouver area code) and then beep out 2111 (the internal phone-company code for Telex testing), and find themselves at any time, day or night, on an open wire talking with an array of phone phreaks from coast to coast, operators from Bermuda, Tokyo and London who are phone-phreak sympathizers, and miscellaneous guests and technical experts. The conference was a massive exchange of information. Phone phreaks picked each other's brains clean, then developed new ways to pick the phone company's brains clean. Ralph gave “MF boogie” concerts with his home-entertainment-type electric organ, Captain Crunch demonstrated his round-the-world prowess with his notorious computerized unit and dropped leering hints of the "action" he was getting with his girlfriends. (The Captain lives out or pretends to live out several kinds of fantasies to the gossipy delight of the blind phone phreaks who urge him on to further triumphs on behalf of all of them.) The somewhat rowdy Northwest phone-phreak crowd let their bitter internal feud spill over into the peaceable conference line, escalating shortly into guerrilla warfare; Carl the East Coast international tone relations expert demonstrated newly opened direct M-F routes to central offices on the island of Bahrain in the Persian Gulf, introduced a new phone-phreak friend of his in Pretoria, and explained the technical operation of the new Oakland-to-Vietnam linkages. (Many phone phreaks pick up spending money by M-F-ing calls from relatives to Vietnam G.I.'s, charging $5 for a whole hour of trans-Pacific conversation.)

Day and night the conference line was never dead. Blind phone phreaks all over the country, lonely and isolated in homes filled with active sighted brothers and sisters, or trapped with slow and unimaginative blind kids in straitjacket schools for the blind, knew that no matter how late it got they could dial up the conference and find instant electronic communion with two or three other blind kids awake over on the other side of America. Talking together on a phone hookup, the blind phone phreaks say, is not much different from being there together. Physically, there was nothing more than a two-inch-square wafer of titanium inside a vast machine on Vancouver Island. For the blind kids there meant an exhilarating feeling of being in touch, through a kind of skill and magic which was peculiarly their own.

Last April 1, however, the long Vancouver Conference was shut off. The phone phreaks knew it was coming. Vancouver was in the process of converting from a step-by-step system to a 4A machine and the 2111 Telex circuit was to be wiped out in the process. The phone phreaks learned the actual day on which the conference would be erased about a week ahead of time over the phone company's internal-news-and-shop-talk recording.

For the next frantic seven days every phone phreak in America was on and off the 2111 conference twenty-four hours a day. Phone phreaks who were just learning the game or didn't have M-F capability were boosted up to the conference by more experienced phreaks so they could get a glimpse of what it was like before it disappeared. Top phone phreaks searched distant area codes for new conference possibilities without success. Finally in the early morning of April 1, the end came.

"I could feel it coming a couple hours before midnight," Ralph remembers. "You could feel something going on in the lines. Some static began showing up, then some whistling wheezing sound. Then there were breaks. Some people got cut off and called right back in, but after a while some people were finding they were cut off and couldn't get back in at all. It was terrible. I lost it about one a.m., but managed to slip in again and stay on until the thing died... I think it was about four in the morning. There were four of us still hanging on when the conference disappeared into nowhere for good. We all tried to M-F up to it again of course, but we got silent termination. There was nothing there."

The Legendary Mark Bernay Turns Out To Be "The Midnight Skulker"

Mark Bernay. I had come across that name before. It was on Gilbertson's select list of phone phreaks. The California phone phreaks had spoken of a mysterious Mark Bernay as perhaps the first and oldest phone phreak on the West Coast. And in fact almost every phone phreak in the West can trace his origins either directly to Mark Bernay or to a disciple of Mark Bernay.

It seems that five years ago this Mark Bernay (a pseudonym he chose for himself) began traveling up and down the West Coast pasting tiny stickers in phone books all along his way. The stickers read something like "Want to hear an interesting tape recording? Call these numbers." The numbers that followed were toll-free loop-around pairs. When one of the curious called one of the numbers he would hear a tape recording pre-hooked into the loop by Bernay which explained the use of loop-around pairs, gave the numbers of several more, and ended by telling the caller, "At six o'clock tonight this recording will stop and you and your friends can try it out. Have fun."

"I was disappointed by the response at first," Bernay told me, when I finally reached him at one of his many numbers and he had dispensed with the usual "I never do anything illegal" formalities with which experienced phone phreaks open most conversations. "I went all over the coast with these stickers not only on pay phones, but I'd throw them in front of high schools in the middle of the night, I'd leave them unobtrusively in candy stores, scatter them on main streets of small towns. At first hardly anyone bothered to try it out. I would listen in for hours and hours after six o'clock and no one came on. I couldn't figure out why people wouldn't be interested. Finally these two girls in Oregon tried it out and told all their friends and suddenly it began to spread."

Before his Johnny Appleseed trip Bernay had already gathered a sizable group of early pre-blue-box phone phreaks together on loop-arounds in Los Angeles. Bernay does not claim credit for the original discovery of the loop-around numbers. He attributes the discovery to an eighteen-year-old reform-school kid in Long Beach whose name he forgets and who, he says, "just disappeared one day." When Bernay himself discovered loop-arounds independently, from clues in his readings in old issues of the Automatic Electric Technical Journal, he found dozens of the reform-school kid's friends already using them. However, it was one of Bernay's disciples in Seattle who introduced phone phreaking to blind kids. The Seattle kid who learned about loops through Bernay's recording told a blind friend, the blind kid taught the secret to his friends at a winter camp for blind kids in Los Angeles. When the camp session was over these kids took the secret back to towns all over the West. This is how the original blind kids became phone phreaks. For them, for most phone phreaks in general, it was the discovery of the possibilities of loop-arounds which led them on to far more serious and sophisticated phone-phreak methods, and which gave them a medium for sharing their discoveries.

A year later a blind kid who moved back east brought the technique to a blind kids' summer camp in Vermont, which spread it along the East Coast. All from a Mark Bernay sticker.

Bernay, who is nearly thirty years old now, got his start when he was fifteen and his family moved into an L.A. suburb serviced by General Telephone and Electronics equipment. He became fascinated with the differences between Bell and GT&E equipment. He learned he could make interesting things happen by carefully timed clicks with the disengage button. He learned to interpret subtle differences in the array of clicks, whirrs and kachinks he could hear on his lines. He learned he could shift himself around the switching relays of the L.A. area code in a not-too-predictable fashion by interspersing his own hook-switch clicks with the clicks within the line. Independent phone companies — there are nineteen hundred of them still left, most of them tiny island principalities in Ma Bell's vast empire — have always been favorites with phone phreaks, first as learning tools, then as Archimedes platforms from which to manipulate the huge Bell system. A phone phreak in Bell territory will often M-F himself into an independent's switching system, with switching idiosyncrasies that can give him marvelous leverage over the Bell System.

"I have a real affection for Automatic Electric equipment," Bernay told me. "There are a lot of things you can play with. Things break down in interesting ways."

Shortly after Bernay graduated from college (with a double major in chemistry and philosophy), he graduated from phreaking around with GT&E to the Bell System itself, and made his legendary sticker-pasting journey north along the coast, settling finally in Northwest Pacific Bell territory. He discovered that if Bell does not break down as interestingly as GT&E, it nevertheless offers a lot of "things to play with."

Bernay learned to play with blue boxes. He established his own personal switchboard and phone-phreak research laboratory complex. He continued his phone-phreak evangelism with ongoing sticker campaigns. He set up two recording numbers, one with instructions for beginning phone phreaks, the other with latest news and technical developments (along with some advanced instruction) gathered from sources all over the country.

These days, Bernay told me, he had gone beyond phone-phreaking itself. "Lately I've been enjoying playing with computers more than playing with phones. My personal thing in computers is just like with phones, I guess — the kick is in finding out how to beat the system, how to get at things I'm not supposed to know about, how to do things with the system that I'm not supposed to be able to do."

As a matter of fact, Bernay told me, he had just been fired from his computer-programming job for doing things he was not supposed to be able to do. He had been working with a huge time-sharing computer owned by a large corporation but shared by many others. Access to the computer was limited to those programmers and corporations that had been assigned certain passwords. And each password restricted its user to access to only the one section of the computer cordoned off from its own information storager. The password system prevented companies and individuals from stealing each other's information.

"I figured out how to write a program that would let me read everyone else's password," Bernay reports. "I began playing around with passwords. I began letting the people who used the computer know, in subtle ways, that I knew their passwords. I began dropping notes to the computer supervisors with hints that I knew what I know. I signed them 'The Midnight Skulker.' I kept getting cleverer and cleverer with my messages and devising ways of showing them what I could do. I'm sure they couldn't imagine I could do the things I was showing them. But they never responded to me. Every once in a while they'd change the passwords, but I found out how to discover what the new ones were, and I let them know. But they never responded directly to The Midnight Skulker. I even finally designed a program which they could use to prevent my program from finding out what it did. In effect I told them how to wipe me out, The Midnight Skulker. It was a very clever program. I started leaving clues about myself. I wanted them to try and use it and then try to come up with something to get around that and reappear again. But they wouldn't play. I wanted to get caught. I mean I didn't want to get caught personally, but I wanted them to notice me and admit that they noticed me. I wanted them to attempt to respond, maybe in some interesting way."

Finally the computer managers became concerned enough about the threat of information-stealing to respond. However, instead of using The Midnight Skulker's own elegant self-destruct program, they called in their security personnel, interrogated everyone, found an informer to identify Bernay as The Midnight Skulker, and fired him.

"At first the security people advised the company to hire me full-time to search out other flaws and discover other computer freaks. I might have liked that. But I probably would have turned into a double double agent rather than the double agent they wanted. I might have resurrected The Midnight Skulker and tried to catch myself. Who knows? Anyway, the higher-ups turned the whole idea down."

You Can Tap the F.B.I.'s Crime Control Computer in the Comfort of Your Own Home, Perhaps

Computer freaking may be the wave of the future. It suits the phone-phreak sensibility perfectly. Gilbertson, the blue-box inventor and a lifelong phone phreak, has also gone on from phone-phreaking to computer-freaking. Before he got into the blue-box business Gilbertson, who is a highly skilled programmer, devised programs for international currency arbitrage.

But he began playing with computers in earnest when he learned he could use his blue box in tandem with the computer terminal installed in his apartment by the instrumentation firm he worked for. The printout terminal and keyboard were equipped with acoustical coupling, so that by coupling his little ivory Princess phone to the terminal and then coupling his blue box on that, he could M-F his way into other computers with complete anonymity, and without charge; program and re-program them at will; feed them false or misleading information; tap and steal from them. He explained to me that he taps computers by busying out all the lines, then going into a verification trunk, listening into the passwords and instructions one of the time sharers uses, and them M-F-ing in and imitating them. He believes it would not be impossible to creep into the F.B.I's crime control computer through a local police computer terminal and phreak around with the F.B.I.'s memory banks. He claims he has succeeded in re-programming a certain huge institutional computer in such a way that it has cordoned off an entire section of its circuitry for his personal use, and at the same time conceals the arrangement from anyone else's notice. I have been unable to verify this claim.

Like Captain Crunch, like Alexander Graham Bell (pseudonym of a disgruntled-looking East Coast engineer who claims to have invented the black box and now sells black and blue boxes to gamblers and radical heavies), like most phone phreaks, Gilbertson began his career trying to rip off pay phones as a teen-ager. Figure them out, then rip them off. Getting his dime back from the pay phone is the phone phreak's first thrilling rite of passage. After learning the usual eighteen different ways of getting his dime back, Gilbertson learned how to make master keys to coin-phone cash boxes, and get everyone else's dimes back. He stole some phone-company equipment and put together his own home switchboard with it. He learned to make a simple "bread-box" device, of the kind used by bookies in the Thirties (bookie gives a number to his betting clients; the phone with that number is installed in some widow lady's apartment, but is rigged to ring in the bookie's shop across town, cops trace big betting number and find nothing but the widow).

Not long after that afternoon in 1968 when, deep in the stacks of an engineering library, he came across a technical journal with the phone tone frequencies and rushed off to make his first blue box, not long after that Gilbertson abandoned a very promising career in physical chemistry and began selling blue boxes for $1,500 apiece.

"I had to leave physical chemistry. I just ran out of interesting things to learn," he told me one evening. We had been talking in the apartment of the man who served as the link between Gilbertson and the syndicate in arranging the big $300,000 blue-box deal which fell through because of legal trouble. There has been some smoking.

"No more interesting things to learn," he continues. "Physical chemistry turns out to be a sick subject when you take it to its highest level. I don't know. I don't think I could explain to you how it's sick. You have to be there. But you get, I don't know, a false feeling of omnipotence. I suppose it's like phone-phreaking that way. This huge thing is there. This whole system. And there are holes in it and you slip into them like Alice and you're pretending you're doing something you're actually not, or at least it's no longer you that's doing what you thought you were doing. It's all Lewis Carroll. Physical chemistry and phone-phreaking. That's why you have these phone-phreak pseudonyms like The Cheshire Cat, The Red King, and The Snark. But there's something about phone-phreaking that you don't find in physical chemistry." He looks up at me:

"Did you ever steal anything?"

Well yes, I —

"Then you know! You know the rush you get. It's not just knowledge, like physical chemistry. It's forbidden knowledge. You know. You can learn about anything under the sun and be bored to death with it. But the idea that it's illegal. Look: you can be small and mobile and smart and you're ripping off somebody large and powerful and very dangerous."

People like Gilbertson and Alexander Graham Bell are always talking about ripping off the phone company and screwing Ma Bell. But if they were shown a single button and told that by pushing it they could turn the entire circuitry of A.T.&T. into molten puddles, they probably wouldn't push it. The disgruntled-inventor phone phreak needs the phone system the way the lapsed Catholic needs the Church, the way Satan needs a God, the way The Midnight Skulker needed, more than anything else, response.

Later that evening Gilbertson finished telling me how delighted he was at the flood of blue boxes spreading throughout the country, how delighted he was to know that "this time they're really screwed." He suddenly shifted gears.

"Of course, I do have this love/hate thing about Ma Bell. In a way I almost like the phone company. I guess I'd be very sad if they were to go away or if their services were to disintegrate. In a way it's just that after having been so good they turn out to have these things wrong with them. It's those flaws that allow me to get in and mess with them, but I don't know. There's something about it that gets to you and makes you want to get to it, you know."

I ask him what happens when he runs out of interesting, forbidden things to learn about the phone system.

"I don't know, maybe I'd go to work for them for a while."

In security even?

"I'd do it, sure. I just as soon play — I'd just as soon work on either side."

Even figuring out how to trap phone phreaks? I said, recalling Mark Bernay's game.

"Yes, that might be interesting. Yes, I could figure out how to outwit the phone phreaks. Of course if I got too good at it, it might become boring again. Then I'd have to hope the phone phreaks got much better and outsmarted me for a while. That would move the quality of the game up one level. I might even have to help them out, you know, 'Well kids, I wouldn't want this to get around but did you ever think of — ?' I could keep it going at higher and higher levels forever."

The dealer speaks up for the first time. He has been staring at the soft blinking patterns of lights and colors on the translucent tiled wall facing him. (Actually there are no patterns: the color and illumination of every tile is determined by a computerized random-number generator designed by Gilbertson which insures that there can be no meaning to any sequence of events in the tiles.)

"Those are nice games you're talking about," says the dealer to his friend. "But I wouldn't mind seeing them screwed. A telephone isn't private anymore. You can't say anything you really want to say on a telephone or you have to go through that paranoid bull----. 'Is it cool to talk on the phone?' I mean, even if it is cool, if you have to ask 'Is it cool,' then it isn't cool. You know. Like those blind kids, people are going to start putting together their own private telephone companies if they want to really talk. And you know what else. You don't hear silences on the phone anymore. They've got this time-sharing thing on long-distance lines where you make a pause and they snip out that piece of time and use it to carry part of somebody else's conversation. Instead of a pause, where somebody's maybe breathing or sighing, you get this blank hole and you only start hearing again when someone says a word and even the beginning of the word is clipped off. Silences don't count — you're paying for them, but they take them away from you. It's not cool to talk [i.e., if you’re paranoid about being tapped], and you can't hear someone when they don't talk. What the hell good is the phone? I wouldn't mind seeing them totally screwed."

The Big Memphis Bust

Joe Engressia never wanted to screw Ma Bell. His dream had always been to work for her.

The day I visited Joe in his small apartment on Union Avenue in Memphis, he was upset about another setback in his application for a telephone job.

"They're stalling on it. I got a letter today telling me they'd have to postpone the interview I requested again. My landlord read it for me. They gave me some runaround about wanting papers on my rehabilitation status but I think there's something else going on."

When I switched on the forty-watt bulb in Joe's room — he sometimes forgets when he has guests — it looked as if there was enough telephone hardware to start a small phone company of his own.

There is one phone on top of his desk, one phone sitting in an open drawer beneath the desk top. Next to the desk-top phone is a cigar-box-size M-F device with big toggle switches, and next to that is some kind of switching and coupling device with jacks and alligator plugs hanging loose. Next to that is a Braille typewriter. On the floor next to the desk, lying upside down like a dead tortoise, is the half-gutted body of an old black standard phone. Across the room on a torn and dusty couch are two more phones, one of them a touch-tone model; two tape recorders; a heap of phone patches and cassettes, and a life-size toy telephone.

Our conversation is interrupted every ten minutes by phone phreaks from all over the country ringing Joe on just about every piece of equipment but the toy phone and the Braille typewriter. One fourteen-year-old blind kid from Connecticut calls up and tells Joe he's got a girl friend. He wants to talk to Joe about girlfriends. Joe says they'll talk later in the evening when they can be alone on the line. Joe draws a deep breath, whistles him off the air with an earsplitting 2600-cycle whistle. Joe is pleased to get the calls but he looked worried and preoccupied that evening, his brow constantly furrowed over his dark wandering eyes. In addition to the phone-company stall, he has just learned that his apartment house is due to be demolished in sixty days for urban renewal. For all its shabbiness, the Union Avenue apartment house has been Joe's first home-of-his-own and he's worried that he may not find another before this one is demolished.

But what really bothers Joe is that switchmen haven't been listening to him. "I've been doing some checking on 800 numbers lately, and I've discovered that certain 800 numbers in New Hampshire couldn't be reached from Missouri and Kansas. Now it may sound like a small thing, but I don't like to see sloppy work; it makes me feel bad about the lines. So I've been calling up switching offices and reporting it, but they haven't corrected it. I called them up for the third time today and instead of checking they just got mad. Well, that gets me mad. I mean, I do try to help them. There's something about them I can't understand — you want to help them and they just try to say you're defrauding them."

It is Sunday evening and Joe invites me to join him for dinner at a Holiday Inn. Frequently on Sunday evening Joe takes some of his welfare money, calls a cab, and treats himself to a steak dinner at one of Memphis' thirteen Holiday Inns. Memphis is the headquarters of Holiday Inn. Holiday Inns have been a favorite for Joe ever since he made his first solo phone trip to a Bell switching office in Jacksonville, Florida, and stayed in the Holiday Inn there. He likes to stay at Holiday Inns, he explains, because they represent freedom to him and because the rooms are arranged the same all over the country so he knows that any Holiday Inn room is familiar territory to him. Just like any telephone.

Over steaks in the Pinnacle Restaurant of the Holiday Inn Medical Center on Madison Avenue in Memphis, Joe tells me the highlights of his life as a phone phreak.

At age seven, Joe learned his first phone trick. A mean baby-sitter, tired of listening to little Joe play with the phone as he always did, constantly, put a lock on the phone dial. "I got so mad. When there's a phone sitting there and I can't use it . . . so I started getting mad and banging the receiver up and down. I noticed I banged it once and it dialed one. Well, then I tried banging it twice. . . ." In a few minutes Joe learned how to dial by pressing the hook switch at the right time. "I was so excited I remember going 'whoo whoo' and beat a box down on the floor."

At age eight Joe learned about whistling. "I was listening to some intercept nonworking-number recording in L.A. — I was calling L.A. as far back as that, but I'd mainly dial nonworking numbers because there was no charge, and I'd listen to these recordings all day. Well, I was whistling 'cause listening to these recordings can be boring after a while even if they are from L.A., and all of a sudden, in the middle of whistling, the recording clicked off. I fiddled around whistling some more, and the same thing happened. So I called up the switch room and said, 'I'm Joe. I'm eight years old and I want to know why when I whistle this tune the line clicks off.' He tried to explain it to me, but it was a little too technical at the time. I went on learning. That was a thing nobody was going to stop me from doing. The phones were my life, and I was going to pay any price to keep on learning. I knew I could go to jail. But I had to do what I had to do to keep on learning."

The phone is ringing when we walk back into Joe's apartment on Union Avenue. It is Captain Crunch. The Captain has been following me around by phone, calling up everywhere I go with additional bits of advice and explanation for me and whatever phone phreak I happen to be visiting. This time the Captain reports he is calling from what he describes as "my hideaway high up in the Sierra Nevada." He pulses out lusty salvos of M-F and tells Joe he is about to "go out and get a little action tonight. Do some phreaking of another kind, if you know what I mean." Joe chuckles.

The Captain then tells me to make sure I understand that what he told me about tying up the nation's phone lines was true, but that he and the phone phreaks he knew never used the technique for sabotage. They only learned the technique to help the phone company.

"We do a lot of troubleshooting for them. Like this New Hampshire/Missouri WATS-line flaw I've been screaming about. We help them more than they know."

After we say good-bye to the Captain and Joe whistles him off the line, Joe tells me about a disturbing dream he had the night before: "I had been caught and they were taking me to a prison. It was a long trip. They were taking me to a prison a long long way away. And we stopped at a Holiday Inn and it was my last night ever at a Holiday Inn, and it was my last night ever using the phone and I was crying and crying, and the lady at the Holiday Inn said, 'Gosh, honey, you should never be sad at a Holiday Inn. You should always be happy here. Especially since it's your last night.' And that just made it worse and I was sobbing so much I couldn't stand it."

Two weeks after I left Joe Engressia's apartment, phone-company security agents and Memphis police broke into it. Armed with a warrant, which they left pinned to a wall, they confiscated every piece of equipment in the room, including his toy telephone. Joe was placed under arrest and taken to the city jail where he was forced to spend the night since he had no money and knew no one in Memphis to call.

It is not clear who told Joe what that night, but someone told him that the phone company had an open-and-shut case against him because of revelations of illegal activity he had made to a phone-company undercover agent.

By morning Joe had become convinced that the reporter from Esquire, with whom he had spoken two weeks ago, was the undercover agent. He probably had ugly thoughts about someone he couldn't see gaining his confidence, listening to him talk about his personal obsessions and dreams, while planning all the while to lock him up.

"I really thought he was a reporter," Engressia told the Memphis Press-Scimitar. "I told him everything...." Feeling betrayed, Joe proceeded to confess everything to the press and police.

As it turns out, the phone company did use an undercover agent to trap Joe, although it was not the Esquire reporter.

Ironically, security agents were alerted and began to compile a case against Joe because of one of his acts of love for the system: Joe had called an internal service department to report that he had located a group of defective long-distance trunks, and to complain again about the New Hampshire/Missouri WATS problem. Joe always liked Ma Bell's lines to be clean and responsive. A suspicious switchman reported Joe to the security agents who discovered that Joe had never had a long-distance call charged to his name.

Then the security agents learned that Joe was planning one of his phone trips to a local switching office. The security people planted one of their agents in the switching office. He posed as a student switchman and followed Joe around on a tour. He was extremely friendly and helpful to Joe, leading him around the office by the arm. When the tour was over he offered Joe a ride back to his apartment house. On the way he asked Joe — one tech man to another — about "those blue boxes" he'd heard about. Joe talked about them freely, talked about his blue box freely, and about all the other things he could do with the phones.

The next day the phone-company security agents slapped a monitoring tap on Joe's line, which eventually picked up an illegal call. Then they applied for the search warrant and broke in.

In court Joe pleaded not guilty to possession of a blue box and theft of service. A sympathetic judge reduced the charges to malicious mischief and found him guilty on that count, sentenced him to two thirty-day sentences to be served concurrently and then suspended the sentence on condition that Joe promise never to play with phones again. Joe promised, but the phone company refused to restore his service. For two weeks after the trial Joe could not be reached except through the pay phone at his apartment house, and the landlord screened all calls for him.

Phone phreak Carl managed to get through to Joe after the trial, and reported that Joe sounded crushed by the whole affair.

"What I'm worried about," Carl told me, "is that Joe means it this time. The promise. That he'll never phone-phreak again. That's what he told me, that he's given up phone-phreaking for good. I mean his entire life. He says he knows they're going to be watching him so closely for the rest of his life he'll never be able to make a move without going straight to jail. He sounded very broken up by the whole experience of being in jail. It was awful to hear him talk that way. I don't know. I hope maybe he had to sound that way. Over the phone, you know."

He reports that the entire phone-phreak underground is up in arms over the phone company's treatment of Joe. "All the while Joe had his hopes pinned on his application for a phone-company job, they were stringing him along getting ready to bust him. That gets me mad. Joe spent most of his time helping them out. The bastards. They think they can use him as an example. All of sudden they're harassing us on the coast. Agents are jumping up on our lines. They just busted ------'s mute yesterday and ripped out his lines. But no matter what Joe does, I don't think we're going to take this lying down."

Two weeks later my phone rings and about eight phone phreaks in succession say hello from about eight different places in the country, among them Carl, Ed, and Captain Crunch. A nationwide phone-phreak conference line has been reestablished through a switching machine in --------, with the cooperation of a disgruntled switchman.

"We have a special guest with us today," Carl tells me.

The next voice I hear is Joe's. He reports happily that he has just moved to a place called Millington, Tennessee, fifteen miles outside of Memphis, where he has been hired as a telephone-set repairman by a small independent phone company. Someday he hopes to be an equipment troubleshooter.

"It's the kind of job I dreamed about. They found out about me from the publicity surrounding the trial. Maybe Ma Bell did me a favor busting me. I'll have telephones in my hands all day long.”
http://www.slate.com/articles/techno...e_b lue_.html





Free Texts Pose Threat to Carriers
Jenna Wortham

At a time when e-mail and many other forms of electronic communication are essentially free, wireless carriers are still charging as much as 20 cents to send a text message to a phone, and another 20 cents to receive it.

Paying so much to transmit a handful of words is starting to look as antiquated as buying stamps.

There are now a growing number of ways to bypass text-message charges using an Internet connection — much as Skype allows people to make calls without relying on a traditional telephone line. If these services catch on in a big way, analysts say, they could take a big bite out of the profits that text messages generate for wireless carriers.

On Wednesday, Apple plans to introduce a new service called iMessage, which could quickly become the biggest fish in this pond. The service lets iPhone owners send messages with text, photos and video to other iPhone owners over a Wi-Fi or cellular data connection. The service, part of an update to Apple’s iOS mobile operating system, will automatically handle messages sent between iPhone, iPad and iPod Touch users who have upgraded to the latest software.

“There’s a huge amount at stake here,” said Craig Moffett, an analyst at Sanford C. Bernstein, who covers the telecommunications industry. “They are undermining the core business model for an industry that makes most of its money from services that are high priced and low bandwidth, like texting.”

The basic idea is the same with both old- and new-style messages: short bursts that pop up almost instantly on the recipient’s phone. But the path that they take is different. A text message is sent over cellular networks. Services like iMessage transmit messages over the carriers’ data networks and the Internet, much like e-mail. Cellphone customers pay for each text message or sign up for a texting plan, while the newer messages will fall under a customer’s wireless data plan.

More than two trillion text messages are sent each year in the United States, generating more than $20 billion in revenue for the wireless industry. Verizon Wireless alone generates as much as $7 billion a year in revenue from texting, or about 12 percent of the total, Mr. Moffett said, and texting brings in about a third of the operating income.

This highly profitable product was something of a happy accident for cellphone carriers. Srinivasan Keshav, a professor at the University of Waterloo who studies mobile computing, said text messages were almost an afterthought when cellphone standards were being developed in the late 1980s.

Professor Keshav said wireless operators realized there was enough spare capacity in a special control channel on voice networks to also shuttle short messages around. “They could piggyback on the phone railway,” he said, which let the carriers deliver messages cheaply.

Professor Keshav estimates it costs the carriers about a third of a penny to send text messages. Considering that the major carriers charge 10 to 20 cents to send and receive them, “it’s something like a 4,090 percent markup,” he said.

At 20 cents and 160 characters per message, wireless customers are paying roughly $1,500 to send a megabyte of text traffic over the cell network. By comparison, the cost to send that same amount of data using a $25-a-month, two-gigabyte data plan works out to 1.25 cents.

Over time, analysts say, the new messaging services could cut into the amount of money that carriers can make from each of their customers. They point to examples where the slide has already begun, as in the Netherlands, where the popularity of social networks and messaging applications have shrunk texting traffic and eroded profits.

Analysts say Apple is trying to duplicate the success of services like BlackBerry Messenger, or BBM, a free application for BlackBerry smartphone owners that lets them send messages back and forth as in an instant-messaging conversation. It has engendered loyalty among BlackBerry users and has kept some from switching to an Apple or Android device.

“BBM is the stickiest feature of the BlackBerry experience, even more than e-mail,” said Roger Entner, an analyst at Recon Analytics who follows the wireless industry. “Once you have that, you are considerably less likely to switch away from the consumer experience. IMessage makes the whole iOS universe more valuable.”

Because iMessage will work only between iPhones, iPod Touches and iPads, at least at first, it is not clear whether it will inspire customers to ditch their text-messaging plans. And Apple devices account only for 5 percent of the texting traffic sent each year, said Chetan Sharma, an independent mobile analyst.

“But if Apple makes iMessage open and available on other platforms, you could see a much bigger impact,” he said.

History has shown that Apple has a way of shaking up the mobile industry by carving out a path to success that causes other hardware makers to follow in its footsteps. “Anything that Apple does, by definition, does not fly under the radar,” Mr. Entner said.

Both Samsung and Google are reportedly working on services that would allow owners of their phones to swap free messages. Analysts anticipate that Microsoft, which is acquiring Skype and GroupMe, a popular mobile messaging application, will soon incorporate both services into its new line of Windows smartphones. And other downloadable apps like TextPlus, WhatsApp and Kik are gathering a following among people looking for cheap ways to chat with friends.

One such service, called Pinger, says it has 19 million members in the Unites States alone. The company says it has handled more than 15 billion text messages since it began offering its service in 2009.

“It always comes down to the economics,” said Greg Woock, the chief executive of Pinger. “Free is a compelling price point.”

Analysts say the wireless carriers are trying to ready themselves for the coming shift. AT&T recently started requiring new subscribers to choose between two texting plans: pay $20 a month to send unlimited text messages or pay 20 cents for each message sent and received. The company will no longer offer a plan that charged users $10 a month for 1,000 text messages. This is apparently aimed at pushing customers toward a pricier plan even if they are not heavy texters, shoring up AT&T’s texting revenue for now. The company declined to discuss messaging services.

Brenda Raney, a spokeswoman for Verizon Wireless, said the company views social messaging as being complementary to other features on the phone. Customers will use a combination of text messages, iMessage, e-mail and the like, she said.

“From a business perspective, customers still need a data plan to connect to a device,” Ms. Raney said. “They are only making choices on how they are using the data.”
https://www.nytimes.com/2011/10/10/t...nies-fret.html





Dennis Ritchie, Trailblazer in Digital Era, Dies at 70
Steve Lohr

Dennis M. Ritchie, who helped shape the modern digital era by creating software tools that power things as diverse as search engines like Google and smartphones, was found dead on Wednesday at his home in Berkeley Heights, N.J. He was 70.

Mr. Ritchie, who lived alone, was in frail health in recent years after treatment for prostate cancer and heart disease, said his brother Bill.

In the late 1960s and early ’70s, working at Bell Labs, Mr. Ritchie made a pair of lasting contributions to computer science. He was the principal designer of the C programming language and co-developer of the Unix operating system, working closely with Ken Thompson, his longtime Bell Labs collaborator.

The C programming language, a shorthand of words, numbers and punctuation, is still widely used today, and successors like C++ and Java build on the ideas, rules and grammar that Mr. Ritchie designed. The Unix operating system has similarly had a rich and enduring impact. Its free, open-source variant, Linux, powers many of the world’s data centers, like those at Google and Amazon, and its technology serves as the foundation of operating systems, like Apple’s iOS, in consumer computing devices.

“The tools that Dennis built — and their direct descendants — run pretty much everything today,” said Brian Kernighan, a computer scientist at Princeton University who worked with Mr. Ritchie at Bell Labs.

Those tools were more than inventive bundles of computer code. The C language and Unix reflected a point of view, a different philosophy of computing than what had come before. In the late ’60s and early ’70s, minicomputers were moving into companies and universities — smaller and at a fraction of the price of hulking mainframes.

Minicomputers represented a step in the democratization of computing, and Unix and C were designed to open up computing to more people and collaborative working styles. Mr. Ritchie, Mr. Thompson and their Bell Labs colleagues were making not merely software but, as Mr. Ritchie once put it, “a system around which fellowship can form.”

C was designed for systems programmers who wanted to get the fastest performance from operating systems, compilers and other programs. “C is not a big language — it’s clean, simple, elegant,” Mr. Kernighan said. “It lets you get close to the machine, without getting tied up in the machine.”

Such higher-level languages had earlier been intended mainly to let people without a lot of programming skill write programs that could run on mainframes. Fortran was for scientists and engineers, while Cobol was for business managers.

C, like Unix, was designed mainly to let the growing ranks of professional programmers work more productively. And it steadily gained popularity. With Mr. Kernighan, Mr. Ritchie wrote a classic text, “The C Programming Language,” also known as “K. & R.” after the authors’ initials, whose two editions, in 1978 and 1988, have sold millions of copies and been translated into 25 languages.

Dennis MacAlistair Ritchie was born on Sept. 9, 1941, in Bronxville, N.Y. His father, Alistair, was an engineer at Bell Labs, and his mother, Jean McGee Ritchie, was a homemaker. When he was a child, the family moved to Summit, N.J., where Mr. Ritchie grew up and attended high school. He then went to Harvard, where he majored in applied mathematics.

While a graduate student at Harvard, Mr. Ritchie worked at the computer center at the Massachusetts Institute of Technology, and became more interested in computing than math. He was recruited by the Sandia National Laboratories, which conducted weapons research and testing. “But it was nearly 1968,” Mr. Ritchie recalled in an interview in 2001, “and somehow making A-bombs for the government didn’t seem in tune with the times.”

Mr. Ritchie joined Bell Labs in 1967, and soon began his fruitful collaboration with Mr. Thompson on both Unix and the C programming language. The pair represented the two different strands of the nascent discipline of computer science. Mr. Ritchie came to computing from math, while Mr. Thompson came from electrical engineering.

“We were very complementary,” said Mr. Thompson, who is now an engineer at Google. “Sometimes personalities clash, and sometimes they meld. It was just good with Dennis.”

Besides his brother Bill, of Alexandria, Va., Mr. Ritchie is survived by another brother, John, of Newton, Mass., and a sister, Lynn Ritchie of Hexham, England.

Mr. Ritchie traveled widely and read voraciously, but friends and family members say his main passion was his work. He remained at Bell Labs, working on various research projects, until he retired in 2007.

Colleagues who worked with Mr. Ritchie were struck by his code — meticulous, clean and concise. His writing, according to Mr. Kernighan, was similar. “There was a remarkable precision to his writing,” Mr. Kernighan said, “no extra words, elegant and spare, much like his code.”
https://www.nytimes.com/2011/10/14/t...ies-at-70.html





Film Fading to Black
Debra Kaufman

ARRI, Panavision and Aaton have all quietly ceased production of their film cameras to focus exclusively on the design and manufacture of digital cameras. Film? Fade to black.

While the debate has raged over whether or not film is dead, ARRI, Panavision and Aaton have quietly ceased production of film cameras within the last year to focus exclusively on design and manufacture of digital cameras. That's right: someone, somewhere in the world is now holding the last film camera ever to roll off the line.

"The demand for film cameras on a global basis has all but disappeared," says ARRI VP of Cameras, Bill Russell, who notes that the company has only built film cameras on demand since 2009. "There are still some markets--not in the U.S.--where film cameras are still sold, but those numbers are far fewer than they used to be. If you talk to the people in camera rentals, the amount of film camera utilization in the overall schedule is probably between 30 to 40 percent."

At New York City rental house AbelCine, Director of Business Development/Strategic Relationships Moe Shore says the company rents mostly digital cameras at this point. "Film isn't dead, but it's becoming less of a choice," he says. "It's a number of factors all moving in one direction, an inexorable march of digital progress that may be driven more by cell phones and consumer cameras than the motion picture industry."

Aaton founder Jean-Pierre Beauviala notes why. "Almost nobody is buying new film cameras. Why buy a new one when there are so many used cameras around the world?" he says. "We wouldn't survive in the film industry if we were not designing a digital camera."

Beauviala believes that that stereoscopic 3D has "accelerated the demise of film." He says, "It's a nightmare to synchronize two film cameras." Three years ago, Aaton introduced a new 35mm film camera, Penelope, but sold only 50 to 60 of them. As a result, Beauviala turned to creating a digital Penelope, which will be on the market by NAB 2012. "It's a 4K camera and very, very quiet," he tells us. "We tried to give a digital camera the same ease of handling as the film camera."

Panavision is also hard at work on a new digital camera, says Phil Radin, Executive VP, Worldwide Marketing, who notes that Panavision built its last 35mm Millennium XL camera in the winter of 2009, although the company continues an "active program of upgrading and retrofitting of our 35mm camera fleet on a ongoing basis."

"I would have to say that the pulse [of film] was weakened and it's an appropriate time," Radin remarks. "We are not making film cameras." He notes that the creative industry is reveling in the choices available. "I believe people in the industry love the idea of having all these various formats available to them," he says. "We have shows shooting with RED Epics, ARRI Alexas, Panavision Genesis and even the older Sony F-900 cameras. We also have shows shooting 35mm and a combination of 35mm and 65mm. It's a potpourri of imaging tools now available that have never existed before, and an exciting time for cinematographers who like the idea of having a lot of tools at their disposal to create different tools and looks."

Do camera manufacturers believe film will disappear? "Eventually it will," says ARRI's Russell. "In two or three years, it could be 85 percent digital and 15 percent film. But the date of the complete disappearance of film? No one knows."

From Radin's point of view, the question of when film will die, "Can only be answered by Kodak and Fuji. Film will be around as long as Kodak and Fuji believe they can make money at it," he says.

Film Prints Go Up In Smoke

Neither Kodak nor Fuji have made noises about the end of film stock manufacture, but there are plenty of signs that making film stock has become ever less profitable. The need for film release prints has plummeted in the last year and, in an unprecedented move, Deluxe Entertainment Services Group and Technicolor--both of which have been in the film business for nearly 100 years--essentially divvied up the dwindling business of film printing and distribution.

Couched in legalese of mutual "subcontracting" deals, the bottom line is that Deluxe will now handle all of Technicolor's 35mm bulk release print distribution business in North America. Technicolor, meanwhile, will handle Deluxe's 35mm print distribution business in the U.S. and Deluxe's 35mm/16mm color negative processing business in London, as well as film printing in Thailand. In the wake of these agreements, Technicolor shut its North Hollywood and Montreal film labs and moved its 65mm/70mm print business to its Glendale, California, facility; and Deluxe ended its 35mm/16mm negative processing service at two facilities in the U.K.

"It's a stunning development," says International Cinematographer Guild President Steven Poster, ASC. "We've been waiting for it as far back as 2001. I think we've reached a kind of tipping point on the acquisition side and, now, there's a tipping point on the exhibition side."

"From the lab side, obviously film as a distribution medium is changing from the physical print world to file-based delivery and Digital Cinema," says Deluxe Digital Media Executive VP/General Manager Gray Ainsworth. "The big factories are absolutely in decline. Part of the planning for this has been significant investments and acquisitions to bolster the non-photochemical lab part of our business. We're developing ourselves to be content stewards, from the beginning with on-set solutions all the way downstream to distribution and archiving." Deluxe did exactly that with the 2010 purchase of the Ascent Media post production conglomerate.

Technicolor has also been busy expanding into other areas of the motion picture/TV business, with the purchase of Hollywood post house LaserPacific and a franchise licensing agreement with PostWorks New York. Technicolor also acquired Cinedigm Digital Cinema Corp., expanding their North America footprint in Digital Cinema connectivity to 90 percent. "We have been planning our transition from film to digital, which is why you see our increased investments and clear growth in visual effects and animation, and 2D-to-3D conversion," says Technicolor's Ouri. "We know one day film won't be around. We continue to invest meaningfully in digital and R&D."

Digital: An "Overnight Success"

Although recent events--the end of film camera manufacturing and the swan dive of the film distribution business--makes it appear that digital is an overnight success, nothing could be further from the truth. Digital first arrived with the advent of computer-based editing systems more than 20 years ago, and industry people immediately began talking about the death of film. "The first time I heard film was dead was in 1972 at a TV station with videotape," says Poster, ASC. "He said, give it a year or two."

Videotape did overtake film in the TV station, but, in the early 1990s, with the first stirrings of High Definition video, the "film is dead" mantra arose again. Laurence Thorpe, who was involved in the early days of HD cameras at Sony, recalls the drumbeat. "In the 1990s, there were a lot of folks saying that digital has come a long way and seems to be unstoppable," he says.

But the path to digital domination has also taken place in a world of Hollywood politics and economics. A near-strike by Screen Actors Guild actors, the Japanese tsunami and dramatic changes in the business of theater exhibition have all contributed to the ebbing fortunes of film. Under pressure, any weakness or break in the disciplines that form the art and science of film--from film schools to film laboratories--could spell the final demise of a medium that has endured and thrived for over 100 years.

Three Strikes And You're Out?

Until 2008, the bulk of TV productions and all feature films took place under SAG jurisdiction, which covers actors in filmed productions. In the months leading up to the Screen Actor Guild's 2008 contract negotiations with the Alliance of Motion Picture and Television Producers, SAG leadership balked on several elements, including the new media provisions of the proposed contract. Negotiations stalemated. Not so with AFTRA, the union that covers actors in videotaped (including HD) productions, which inked its own separate agreement with AMPTP.

"When producers realized they could go with AFTRA contracts, but they now had to record digitally, they switched almost overnight," recalls Poster. Whereas, in previous seasons, 90 percent of the TV pilots were filmed, and under SAG jurisdiction, in one fell swoop the 2009 pilot season went digital video, capturing 90 percent of the pilots. In a single season, the use of film in primetime TV nearly completely vanished, never to return.

The Japanese tsunami on March 11, 2011, further pushed TV production into the digital realm. Up until then, TV productions were largely mastered to Sony's high-resolution HD SR tape, but the sole plant that made the tape, located in the northern city of Sendai, was heavily damaged and ceased operation for several months. With only two weeks worth of tape still available, TV producers scrambled to come up with a workaround, leading at least some of them to switch to a tapeless delivery, another step into the future of an all-digital ecosystem.

The third, and perhaps most devastating blow to film, comes from the increased penetration of Digital Cinema. According to Patrick Corcoran, National Association of Theatre Owners (NATO) Director of Media & Research/California Operations Chief, at the end of July 2011, "We passed the 50 percent mark in terms of digital screens in the U.S. We've been adding screens at a fast clip this year, 700 to 750 a month," he says.

He notes that the turning point was the creation of the virtual print fee, which allows NATO members to recoup the investment they have to make to upgrade to digital cinema. (Studios, meanwhile, save $1 billion a year for the costs of making and shipping release prints.)

To take advantage of the virtual print fee, theater owners will have to transition screens to digital by the beginning of 2013. "Sometime, in 2013, all the screens will be digital," says Corcoran. "As the number of digital screens increase, it won't make economic sense for the studios to make and ship film prints. It'll be absolutely necessary to switch to Digital Cinema to survive."

Reinventing The Film Lab

Can the continued production of film stock survive the twin disappearance of film acquisition and distribution? Veteran industry executive Rob Hummel, currently president of Group 47, recalls when, as head of production operations, he was negotiating the Kodak deal for DreamWorks Studios. "At the time, the Kodak representative told me that motion pictures was 6 percent of their worldwide capacity and 7 percent of their revenues," he recalls. "The rest was snapshots. In 2008 motion pictures was 92 percent of their business and the actual volume hasn't grown. The other business has just disappeared."

Eastman Kodak, Chris Johnson, Director of New Business Development, Entertainment Imaging, counters that "I don't see a time when Kodak stops making film stock," noting the year-on-year growth in 65mm film and popularity of Super 8mm. "We still make billions of linear feet of film," he says. "Over the horizon as far as we can see, we'll be making billions of feet of film."

Yet, as Johnson's title indicates, Kodak is hedging its bets by looking for new areas of growth. One focus is on digital asset management via leveraging its Pro-Tek Vaults for digital, says Johnson, and another is investigating "asset protection film," a less expensive film medium that provides a 50 to 100 year longevity at a lower price point that B&W separation film.

Kodak has also developed a laser-based 3D digital cinema projector. "Our system will give much brighter 3D images because we're using lasers for the light source," says Johnson. "And the costs of long-term ownership is much less expensive because the lasers last longer than the light sources for other projectors."

Storing For The Future

As more than 1 million feet of un-transferred nitrate film worldwide demonstrates, archiving doesn't get top billing in Hollywood. Although the value of archived material is unarguable, positioned at the end of the life cycle of a production, archivists have unfortunately had a relatively weak voice in the discussion over transitioning from film to digital.

Since the "film is dead" debate began, archivists fought to keep elements on film, the only medium that has proven to last well over 100 years. "Most responsible archivists in the industry still believe today that, if you can at all do it, you should still stick it on celluloid and put it in a cold, dry place, because the last 100 years has been the story of nitrate and celluloid," says Deluxe's Ainsworth.

He jokes that if the world's best physicists brought a gizmo to an archivist that they said would hold film for 100 years, the archivist would say, "Fine, come back in 99 years." "With the plethora of digital files, formats and technologies--some of which still exist and some of which don't--we're running into problems with digital files made only five years ago," he adds.

At Sony Pictures Entertainment, Grover Crisp, Executive VP of Asset Management, Film Restoration and Digital Mastering, notes that "Although it's a new environment and everyone is feeling their way through, what's important is to not throw out the traditional sensibilities of what preservation is and means.

"We still make B&W separations on our productions, now directly from the data," he says. "That's been going on for decades and has not stopped. Eventually it will be all digital, somewhere down the road, but following a strict conservation approach certainly makes sense."

Crisp pushes for a dual, hybrid approach. "You need to make sure you're preserving your data as data and your film as film," he says. "And since there's a crossover, you need to do both." LTO tape, currently the digital storage medium of choice, is backwards compatible only two generations, which means that careful migration is a fact of life--for now at least--in a digital age. "The danger of losing media is especially high for documentaries and indie productions," says Crisp.

Hummel and his partners at Group 47, meanwhile, believe they have the solution. His company bought the patents for a digital archival medium developed by Kodak: Digital Optical Tape System (DOTS). "It's a metal alloy system that requires no more storage than a book on a shelf," says Hummel, who reports that Carnegie Mellon University did accelerated life testing to 97 years.

The Death Of Film Redux

"Though reports of its imminent death have been exaggerated, more industry observers than before accept the end of film. "In 100 years, yes," says AbelCine's Shore. "In ten years, I think we'll still have film cameras. So somewhere between 10 and 100 years."

Film camera manufacturers have walked a tightrope, ceasing unprofitable manufacture of film cameras at the same time that they continue to serve the film market by making cameras on demand and upgrading existing ones. But they--as well as film labs and film stock manufacturers--clearly see the future as digital and are acting accordingly.

Will film die? Seen in one way, it never will: our cinematic history exists on celluloid and as long as there are viable film cameras and film, someone will be shooting it. Seen another way, film is already dead...what we see today is the after-life of a medium that has become increasingly marginalized in production and distribution of films and TV. Just as the last film camera was sold without headlines or fireworks, the end of film as a significant production and distribution medium will, one day soon, arrive, without fanfare.
http://magazine.creativecow.net/arti...ading-to-black





How To Enable 18TB Hard Drives? Just Add Salt
Devin Coldewey

The continually increasing size of hard drives means we can all store more pictures, music, games, and so on, but as with the transistor counts in Moore’s Law, those increases don’t come easy. Companies like Toshiba, TDK, and Seagate are forever looking into ways to increase the number of bits they can store inside a drive. It’s already an astounding amount, but they always seem to find a way to improve it further.

Today’s advance comes from Singapore’s Institute of Materials Research and Engineering, where Dr Joel Yang has figured out a way to fit several times the number of bits in a given area. The secret? A little salt in the mix.

Hard disks have a surface covered in tiny magnetic granules, each only nanometers across. Groups of them clump together to form tiny, semi-regular islands. The hard drive head flies overhead and flips these islands one way or another to create 1s and 0s.

Those tiny granules are formed by exposing a certain solution to a nanolithographic process (but of course we all knew that already). Dr Yang found that by adding a bit of salt to solution, they were able to produce superior grains. They’re not actually smaller, but instead of having to clump a bunch together in an island, each individual grain can be manipulated individually into a bit storage unit. This means that the data density of the disk’s surface can be increased immensely.

They’ve demonstrated data storage at 1.9 terabits per square inch, which is about four times what the very best hard drives today are capable of. And they’ve made granules small enough that drives based on this new process could reach all the way to 3.3 terabits per inch. That means that your drives could hold as much as 18 terabytes in the near future.

Yang actually developed the salty solution when he was at MIT, but it looks like IMRE gets to reap the rewards, at least if they can commercialize it. We probably won’t see drives based on this tech for a couple years, but the improvement is notable regardless. The full paper can be read here.
http://techcrunch.com/2011/10/14/how...just-add-salt/





After Reviewing Bids, Citi Looks to Sell EMI in Pieces: Sources
Yinka Adegoke and Nadia Damouni

EMI Group Ltd, the home of Coldplay and Katy Perry, looks increasingly likely to be sold off as two separate businesses -- recorded music and song publishing -- after final bids came in last week, according to several people familiar with the matter.

The British music company is reviewing competing offers for EMI Publishing from BMG Music, a joint venture between Bertelsmann and private equity firm Kohlberg Kravis Roberts, and Sony/ATV -- a joint venture between Sony Corp and the estate of Michael Jackson, these people said.

BMG-KKR and Sony have submitted the highest offers for EMI's publishing business, the people said. One of them added that the two bids came in close to each other.

Vivendi SA's Universal Music Group and Len Blavatnik's Warner Music Group are vying for the recorded music side of EMI, people familiar with the matter said.

U.S. bank Citigroup, which took control of EMI in February, is expected to pick winning bidders for the businesses by the end of next week, the people said.

While Warner Music has also been interested in buying all of EMI, significant anti-trust hurdles on the publishing segment, as well as challenges in lining up financing in a volatile market, makes such a deal unlikely, the people said.

Moreover, Blavatnik, whose Access Industries bought Warner Music in May for $3.3 billion, has privately expressed reluctance to bid aggressively so soon after winning Warner Music, according to two of the people close to the transaction process. WMG Chairman Edgar Bronfman Jr. has long coveted EMI, and losing out on the chance to buy it once again is certain to hasten his departure from the company.

EMI Chief Executive Roger Faxon has publicly argued against splitting the business, saying that each side benefits the other. Since the former head of EMI's publishing operation took over leadership of the entire company, he has pushed to more closely integrate both divisions, making it potentially more difficult to split the company.

But the chances of selling EMI as a whole were hurt by the tightening of credit markets in recent weeks, which have prompted banks to stiffen lending terms, thereby making deals more expensive, the people familiar with the matter said.

EMI, whose artist roster includes the Beastie Boys, the Beatles and Keith Urban, is seen as one of the last remaining attractive assets in the music industry. The company said in June that it was exploring strategic alternatives and has since been running an auction, which two sources said has been code named "Project Nile."

Dividing EMI will likely generate richer bids for Citi, which is hoping to collect as much as $4 billion from the auction, said people familiar with the matter.

EMI's publishing unit is the stronger of the two assets and has attracted bids of roughly $2 billion from Sony/ATV Music Publishing and BMG Music Rights, according to two people. Sony/ATV is run by Marty Bandier, who is best known in the music business for building EMI Publishing into the industry's premiere publishing operation over 16 years before leaving in 2006.

BMG, which is a joint venture of German media giant Bertelsmann and private equity firm KKR, has made a string of music publishing acquisitions in the last year. The venture does not have a recorded music arm.

Universal Music Group is currently the frontrunner for EMI's recorded music division, which includes the Capitol and Virgin labels, one of the people said.

A Citi spokeswoman declined comment. A representative for EMI was not immediately available for comment. All bidders have declined to comment throughout the sale process.

(Reporting by Nadia Damouni, Soyoung Kim and Yinka Adegoke in New York; Editing by Peter Lauria, Bernard Orr)
http://www.reuters.com/article/2011/...79B7XI20111012





Campaign Grows to Oust Murdoch

Shareholder service advises ousting Rupert Murdoch, two sons and 10 other directors from NewsCorp board
Juliette Garside

Rupert Murdoch. Institutional Shareholder Services said the phone hacking scandal had 'laid bare a striking lack of stewardship and failure of independence' on the board of News Corporation Photograph: Lewis Whyld/PA

The shareholder-led campaign for an overhaul of Rupert Murdoch's News Corporation is gathering momentum, with a call from the advisers Institutional Shareholder Services for 13 of the company's 15 directors to be voted off the board.

ISS, whose 1,700 clients include pension funds, trade union funds and asset managers in the United States and around the world, issued a condemnation of the media conglomerate's executive and independent directors on Monday.

It said the phone hacking scandal had "laid bare a striking lack of stewardship and failure of independence by a board whose inability to set a strong tone-at-the-top about unethical business practices has now resulted in enormous costs – financial, legal, regulatory, reputational and opportunity – for the shareholders the board ostensibly serves."

ISS wants the firm's founder, Rupert Murdoch, and his sons James and Lachlan voted off the board at the shareholder meeting on 21 October.

An executive summary of the ISS advice to shareholders says the problems stretch back to at least 2004, when News Corporation moved its corporate base from Australia to Delaware. It is also advising a vote against the executive compensation plan, complaining that Rupert Murdoch, the chief executive and chairman, received a cash bonus of $12.5m in 2011, up from $4.4m the year before, despite the revelations of the extent of illegal practices at the News of the World this year.

The only directors ISS recommends voting in favour of are Joel Klein and James Breyer, as they have served on the board for just a few months. Klein runs the company's education division, while Breyer is a partner in the venture capital firm Accel and serves on the boards of Walmart and Dell.

ISS said: "Shareholders elect independent directors to protect against governance risk of self-inflicted damage to corporate reputation, viability and long-term shareholder value. The independent directors, rather than embracing their central governance role, opted not to guard the guardians."

The advice follows several calls from proxy advisory firms for a radical News Corp overhaul. Glass Lewis, which advises institutions with more than $15tn in assets, said shareholders should vote against James and Lachlan Murdoch and four other directors.

The UK's Pirc, the Local Authority Pension Fund Forum, which represents £100bn of pension funds, and the Australian Council of Superannuation Investors have also urged voters to oust directors.

News Corp said it "strongly disagrees" with the ISS advice. "The company takes the issues surrounding News of the World seriously and is working hard to resolve them, however ISS's disproportionate focus on these issues is misguided and a disservice to our stockholders."
http://www.guardian.co.uk/media/2011...o-oust-murdoch





Lulzsec Hacker: 'We Still Have Sun Emails, Stored in China'

Sabu, the erstwhile leader of the hacking crew, says he is effectively on the run as he gives interview to Reddit readers about LulzSec's achievements, Facebook, sentencing and more
Charles Arthur

The LulzSec hacking group hit a number of sites in a spree in May and July 2011; now its leader Sabu has given an interview on Reddit. Photograph: Reuters

The hacker who styles himself "Sabu", erstwhile leader of the LulzSec hacking crew, claims to have a cache of emails copied from the Sun which are being stored on a Chinese server, along with data from a number of other hacks.

But he claimed this weekend that they will not be released yet: "there are a lot of interesting dumps we're sitting on due to timing," he wrote on his Twitter feed. He claims that hackers have broken into banks including HSBC and "a few others" but that they have found "no smoking guns yet" in the data there.

Sabu – who says his online handle is a tribute to the American professional wrestler – says that after the arrests in the UK and US of a number of people alleged to have been involved with the crew, he is effectively on the run. But his writing also suggests he is staying put where he lives.

"I'm past the point of no return. Not trying to sound like a bad ass, however, it's the truth," he wrote. Later he added: "The ironic twist will be that my own friends will take me down, and not these idiots who hide behind the patriot veil." He also says that "technically, I'm on the run, so there you go."

LulzSec was an offshoot of the Anonymous hacking collective which during a hacking spree in May and July 2011 broke into a number of sites, including Sony Pictures Europe, Fox.com, PBS and finally the News International site.

At the latter it altered the Sun's web page so that it redirected viewers first to a faked story about Rupert Murdoch's death, and then to their Twitter feed. The group also attacked the US Congress's web site, an FBI affiliate and brought down the web site for the UK's Serious Organised Crime Agency by using a "distributed denial of service" attack.

Sabu effectively acted as the leader of the group, maintaining discipline over what they did, as leaked chatroom logs published in June by the Guardian show.

At that time he told members of the crew not to give interviews – but says his willingness to do so now is because "that was during the height of LulzSec. We all agreed to do no interviews till the end if there was ever one."

LulzSec's achievements, he says, were that it "exposed the sad state of security across the media, social, government online environments".

After the Sun hack, Sabu claimed on his Twitter feed that he was looking at 4GB of emails from the company. The claim was never confirmed, although remote access to News International's systems had been compromised.

Sabu's revelations came in a long and sometimes detailed "Ask Me Anything" (AMA) thread on Reddit. Sabu responds to a number of questions and appears to reveal a number of details about himself, such as that he is married, studied social sciences and English, that his technical hacking skills are self-taught, and that he teaches "sometimes". He claims to speak three languages – English, Spanish and German – fluently, and to have "decent" Portuguese and Italian. He says he turned towards computer hacking in 2000, when the US government "ignored the peoples' please to stop bombing Vieques" – a part of Puerto Rico used by the US navy as a bombing range until 2003. He says he likes working on cars, playing music and spending time with his family: "I'm loving life a lot this year. I barely have time for ops [hacker operations] like I used to."

That confirms other details that have been collected by rival hackers about Sabu which suggest that he is of Puerto Rican extraction, aged about 30 and based in New York.

He insists that he had no knowledge of the identities of any of the other members of LulzSec. "I simply don't know anyone's identity at Anonymous." He says that when one alleged member was arrested in the Shetland Islands, north of Scotland, he had to go and look up its location: "I was a bit impressed, even." He vehemently denies the suggestions by some that he "snitched" on other LulzSec members to the authorities.

The breakup of LulzSec meant he has "lost too many friends. [i] will probably never talk to them ever again." But he thinks that it "has already achieved what it set out to achieve".

He suggests that one of the LulzSec members, called Avunit, who quit the group when it took aim at the FBI, "is relaxing somewhere on a boat".

Asked whether he is "safe", he replies: "no one can prove it's me anyway. The beauty of Anonymous." The closest that the authorities have come to him is when in September they arrested a hacker alleged to have gone by the online handle "Recursion", who was tracked down via logs held by the British company HideMyAss, which unwittingly provided a virtual private network (VPN) connection for the attack on Sony Pictures Europe.

That arrest was "probably the closest they ever got", Sabu says. He also makes a veiled threat against HideMyAss: he alleges it "turns out to be owned by some … people who are going around buying smaller VPN providers ... We should have a nice exposé for HMA and its mother computer/investors soon. Point is: research your VPN provider thoroughly."

He says he takes a number of precautions to evade law enforcement, using prepaid phones and BlackBerrys for calls and Twitter: "they're expendable. I don't ignore you, I simply don't know you." He trusts Twitter – to some extent: "believe it or not, Twitter has not been sleeping in bed with LEAs [law enforcement agencies]. In fact it's a process [for LEAs] to get account info."

He rails at the sentencing guidelines in place for computer activity: "The penalties for any cybercrime (with the exception of child pornography) is severely archaic. And enforced by non-computer users. A DDOS (distributed denial of service) should not [attract a sentence of] 10 years at all especially when rapists and murderers do LESS than time." (The Guardian's James Ball made a similar point earlier this year.)

He thinks a hacking attack against Facebook "is pointless unless some very courages [sic] individual go and burn down its datacenter containing DBs [databases]". But he calls Facebook "a serious global cancer … they have half a billion people's psychology and family down in a database".

LulzSec does not have a Google Plus account, he says: "We do NOT have a g+ account. So whoever is running it is more than likely posing and has no affiliation to us." (Other Reddit users said that files distributed from that account contain malware.) Google Plus was launched well after LulzSec apparently broke up.

His advice to would-be emulators: "Stick to yourselves. If you are in a crew – keep your opsec up 24/7. Friends will try to take you down if they have to."

Anonymous, he says, is "no leaders, no hierarchy, no cointelpro [counter-intelligence program] drama. And we are a living, moving mass of like-minded individuals." He says it is "pure democracy", though that can be anarchic. But he thinks it will spawn "many organisations and political parties". But he says that "you don't need to be 'anonymous' or need to hack to be Anonymous. It's an idea, not a job."

He says he hopes to give a talk at the next HOPE (Hackers on Planet Earth) conference in New York, expected to run in July 2012.
http://www.guardian.co.uk/technology...ker-sun-emails





Security Firm RSA Blames Nation State for Attack On its Servers
Graham Cluley

RSA SecurID and ChinaRSA has revealed that it believes two groups, working on behalf of a single nation state, hacked into its servers and stole information related to the company's SecurID two-factor authentication products.

Speaking at the RSA Security Conference in London, RSA's executive chairman Art Coviello described the high profile attack that made headlines around the world.

"There were two individual groups from one nation state, one supporting the other. One was very visible and one less so.. We've not attributed it to a particular nation state although we're very confident that with the skill, sophistication and resources involved it could only have been a nation state."

Inevitably, people are likely to assume that China might have been involved in the attack - but there's nothing in RSA's statements to either implicate China or to back-up the claims that any country was involved.

It seems very odd to me for a company to say that they have determined that a country had attacked them, but to not then name the country.

You will probably remember that RSA didn't do itself many favours when it first admitted the breach in April, playing its cards rather close to its chest then, and not saying much more about the ongoing security of its tokens than:

"we are confident that the information extracted does not enable a successful direct attack on any of our RSA SecurID customers."

Unfortunately, the truth was that RSA's server breach did subsequently lead to another attack against a leading US military contractor, and the security firm's hand was forced into offering to replace some customers' SecurID devices.

The malware attack

RSA was struck by a targeted malware attack, emailed to a small number of their employees.

Attached to the email was a file, "2011 Recruitment plan.xls". The poorly worded email was designed to trick uses into opening the attachment. And - unfortunately - at least one of them fell for the trap.

The Excel spreadsheet had been boobytrapped, and contained a malicious Flash payload inside it. Opening the file exploited an Adobe zero-day vulnerability that then downloaded a remote access Trojan horse called Poison Ivy onto the computer.

Once the Trojan horse was in place, the hackers could begin to steal information and inveigle their way into RSA's network infrastructure.

(Incidentally, Sophos has been detecting the malicious XLS file since March 2011 as Troj/SWFExp-Y - although at the time, we did not know this was the malware used in the RSA security breach).

APT or not?

At the time of the initial disclosure, RSA's Coviello described the attack as an "extremely sophisticated" Advanced Persistent Threat (APT).

Some wags in the security industry have noted that corporate victims of malware attacks might like to use the "APT" buzzword to make a breach seem less embarrassing.

Whether that's fair or not is open to debate. But it certainly puts a better spin on things if you claim that highly-skilled hackers with the resources of an unnamed country attacked your computer network rather than your common-or-garden cybercriminal.

I haven't seen or heard anything which has convinced me that a nation state had to be involved in the attack against RSA. The only thing which begins to point a finger towards a foreign power being involved is the fact that information stolen by the RSA hackers was subsequently used in attacks against military contractors.

You have to ask yourself who would have the biggest motive for that - and the most likely answer would be another country.

Regardless of who was responsible for the attack, we must not forget that RSA and some of its customers were the victims of criminal acts. They didn't deserve to be hacked, and we all have to be on our guard to prevent comparable attacks happening against our own companies.
http://nakedsecurity.sophos.com/2011...-state-attack/





An Important Message From Sony’s Chief Information Security Officer
Philip Reitinger

We want to let you know that we have detected attempts on Sony Entertainment Network, PlayStation Network and Sony Online Entertainment (“Networks”) services to test a massive set of sign-in IDs and passwords against our network database. These attempts appear to include a large amount of data obtained from one or more compromised lists from other companies, sites or other sources. In this case, given that the data tested against our network consisted of sign-in ID-password pairs, and that the overwhelming majority of the pairs resulted in failed matching attempts, it is likely the data came from another source and not from our Networks. We have taken steps to mitigate the activity.

Less than one tenth of one percent (0.1%) of our PSN, SEN and SOE audience may have been affected. There were approximately 93,000 accounts globally (PSN/SEN: approximately 60,000 accounts; SOE: approximately 33,000) where the attempts succeeded in verifying those accounts’ valid sign-in IDs and passwords, and we have temporarily locked these accounts. Only a small fraction of these 93,000 accounts showed additional activity prior to being locked. We are currently reviewing those accounts for unauthorized access, and will provide more updates as we have them. Please note, if you have a credit card associated with your account, your credit card number is not at risk. We will work with any users whom we confirm have had unauthorized purchases made to restore amounts in the PSN/SEN or SOE wallet.

As a preventative measure, we are requiring secure password resets for those PSN/SEN accounts that had both a sign-in ID and password match through this attempt. If you are in the small group of PSN/SEN users who may have been affected, you will receive an email from us at the address associated with your account that will prompt you to reset your password.

Similarly, the SOE accounts that were matched have been temporarily turned off. If you are among the small group of affected SOE customers, you will receive an email from us at the address associated with your account that will advise you on next steps in order to validate your account credentials and have your account turned back on.

We want to take this opportunity to remind our consumers about the increasingly common threat of fraudulent activity online, as well as the importance of having a strong password and having a username/password combination that is not associated with other online services or sites. We encourage you to choose unique, hard-to-guess passwords and always look for unusual activity in your account.
http://blog.us.playstation.com/2011/...urity-officer/





111 Arrested in Massive ID Theft Bust

Restaurant workers and bank insiders are charged in what's billed as the largest-ever ID theft round-up
Robert McMillan

Prosecutors call it the biggest identity theft bust in US history. On Friday, 111 bank tellers, retail workers, waiters and alleged criminals were charged with running a credit-card-stealing organization that stole more than $US13 million in less than a year-and-a-half.

"This is by far the largest -- and certainly among the most sophisticated -- identity theft/credit card fraud cases that law enforcement has come across," the Queens County District Attorney's office said in a statement announcing the arrests.

The credit card numbers came from far and wide: from skimming operations in the U.S., where restaurant employees or retail cashiers were paid to steal credit card data from customers; from carder forums on the Internet; and also from shady overseas suppliers in countries such as Russia, China and Libya.

In all, five groups of criminals were targeted in the two-year law enforcement operation, dubbed "Operation Swiper." Together, they ran the full gamut of criminal activities required to steal credit card numbers and convert that data into cash, prosecutors said.

Eighty-six of the defendants are in custody; police are looking for the remaining 25, prosecutors said.

The accused are charged with running a thoroughly modern identity theft ring that included ID thieves, skimmers, card makers, fences and shopping crews: groups that would buy thousands of dollars worth of merchandise in stores throughout the U.S.

"Many of the defendants charged today are accused of going on nationwide shopping sprees, staying at five-star hotels, renting luxury automobiles and private jets, and purchasing tens of thousands of dollars worth of high-end electronics," the Queens DA office said.

During a raid earlier this week, police seized "a box truck full of electronics, computers, shoes and watches, skimmers, card readers, embossers and various amounts of raw material, such as blank credit cards and fake identifications," the DA's office said.

Six of the accused are charged with stealing $850,000 worth of computer equipment from a Citigroup building in Long Island City last August. Prosecutors say that a former Citi employee, Steven Oluwo, and a security guard under contract to Citigroup, Angel Quinones, helped with the theft.

Apple, Best Buy, Nordstrom, Macy's and many financial institutions, including Citi, Chase Bank and Bank of America, are credited with helping with the investigation.
http://www.techworld.com.au/article/...id_theft_bust/





Those High-Security Swipe Cards that Secure Your Front Door May Be No Good

German researchers have cracked the latest generation of smart swipe-card authenticators
Kevin Fogarty

The physical security of your company and its data just got less secure if your company is one of millions that use a particular kind of smart card designed to give commuters, corporate wage slaves and security specialists quick passage through, security gates and sown the invisible elevator that takes them to the secret headquarters underneath the streets of Cardiff.

A team of German scientists have demonstrated a hack that lets them make a perfect clone of the kind of magnetic security card used to give workers in corporate or government buildings – including NASA – and as a daily ticket replacement on busses and subways. The same team broke a previous version of contactless-ID cards from Mifare in 2008, prompting the company to upgrade its security, creating a card able to be programmed only once and which contained a unique identifying number that could be checked against the programmed content on the card for extra security.

Higher-functioning cards have come processing capablity, including the ability to create random identifying numbers to help prevent copies, 128-bit key encryption, support for AES encryption and a series of other extra features.

NXP Semiconductors, which owns Mifare, put out an alert to customers warning that the security had been cracked on its MIFARE DESFire (MF3ICD40) smartcard but saying that model would be discontinued by the end of the year and encouraging customers to upgrade to the EV1 version of the card.

NXP is one of the largest providers of security smartcards; it has sold a total of 3.5 billion of the cards, but wouldn't estimate how many of the cracked cards are in circulation.

Researchers David Oswald and Christof Paar at Ruhr University in Germany, who worked on the crack of the KeeLoq remote keyless entry system in 2008, used side-channel analysis for both cracks. The technique relies on use of a probe and oscilloscope to record the card's broadcasts while it's being read by and RFID reader.

It takes about seven hours to crack the security on one card and get its 112-bit encryption key, the researchers said. It only works if you've already spent months profiling the card's architecture, behavior and responses. Cracking time could be cut to as little as three hours, Paar and Oswald said.

The weak point for the MF31CD40 – and many of NXD's other cards – is that it does little or nothing to resist being recorded, prodded and poked by crackers.

The EV1 upgrade to that card has an on-chip backup management systems, an authentication mechanism that uses three separate authentication methods, encryption based on the 3DES hardware encryption that meets security requirements for most U.S. government agencies, but is compatible with existing systems designed to read the card using Near Field Communications (NFC) radio systems.

That probably means it does not yet contain any countermeasures able to stave off determined crackers poking it to see how it reacts.

The EV1 is designed for transit systems, event-ticketing systems and other applications that would put millions of them in the hands of end users, meaning it won't be hard for anyone wanting to crack it to get ahold of one.

If you use NXP security cards in any of your buildings, or any kind of NFC-based smartcard security, you might want to look into backup systems or to see if anyone's cracked them yet. Odds are getting better that they have.
http://www.itworld.com/security/2117...may-be-no-good





Stanford Researcher Finds Lots of Leaky Web Sites
Somini Sengupta

The Web is porous. Remarkable information trickles in from everywhere. It also sometimes spills out without its users knowing exactly where or how.

Take for instance these findings, released on Tuesday by computer scientists at Stanford University. If you type a wrong password into the Web site of The Wall Street Journal, it turns out that your e-mail address quietly slips out to seven unrelated Web sites. Sign on to NBC and, likewise, seven other companies can capture your e-mail address. Click on an ad on HomeDepot.com and your first name and user ID are instantly revealed to 13 other companies.

These findings, released by the Center for Internet and Society at Stanford Law School, are among the leaks found on 185 top Web sites. They serve to buttress what privacy advocates have long warned of: Your online travel — your clickstream, as it’s poetically known — is not always anonymous. It can often be traced right back to rather precise parts of you, including your name and e-mail address. The study was released at an event organized by the Center for Digital Democracy in Washington.

In this case the leaks appeared to be a byproduct of the way Web browsers dealt with the handoff between one page and the next, which can result in the sharing of the first page’s address with third-party sites. If a site is set up to include personal information in the page address, then that information is shared as well.

“It’s a fact of life on the Web. Identity will leak to a third party,” said the study’s principal author, Jonathan Robert Mayer, a law and computer science student.

Companies that track Web activity commonly say that they analyze data at the macro level to better target search results and advertising: something as general as new home buyers in a particular ZIP code who may be interested in ads for home and garden products. A body of new research is beginning to show that as our digital footprint grows, it becomes ever easier for companies (and in principle, government authorities) to know more precisely who those home buyers are.

Computer scientists at AT&T Research Labs and Worcester Polytechnic University studied 120 Web sites, not including social networks, and found that over half of them leaked what the researchers called “sensitive and identifiable information to third-party aggregators.”

Meanwhile, a Carnegie Mellon University computer scientist named Alessandro Acquisti has taken photographs of random strangers on a college campus and used facial recognition technology to “re-identify” roughly a third of them from a rich trove of publicly available photographs on Facebook. Even more remarkably, so much personal data now lies scattered online that he was able to glean their Social Security numbers in about a fourth of the cases.
http://bits.blogs.nytimes.com/2011/1...aky-web-sites/





Secret Orders Target Email

WikiLeaks backer's information sought
Julia Angwin

The U.S. government has obtained a controversial type of secret court order to force Google Inc. and small Internet provider Sonic.net Inc. to turn over information from the email accounts of WikiLeaks volunteer Jacob Appelbaum, according to documents reviewed by The Wall Street Journal.

Google and internet provider Sonic.net fought a secret court order to turn over information from the email accounts of a Wikileaks volunteer, Julia Angwin reports on digits.

Sonic said it fought the government's order and lost, and was forced to turn over information. Challenging the order was "rather expensive, but we felt it was the right thing to do," said Sonic's chief executive, Dane Jasper. The government's request included the email addresses of people Mr. Appelbaum corresponded with the past two years, but not the full emails.

Both Google and Sonic pressed for the right to inform Mr. Appelbaum of the secret court orders, according to people familiar with the investigation. Google declined to comment. Mr. Appelbaum, 28 years old, hasn't been charged with wrongdoing.

The court clashes in the WikiLeaks case provide a rare public window into the growing debate over a federal law that lets the government secretly obtain information from people's email and cellphones without a search warrant. Several court decisions have questioned whether the law, the Electronic Communications Privacy Act, violates the U.S. Constitution's Fourth Amendment protections against unreasonable searches and seizures.

WikiLeaks is a publisher of documents that people can submit anonymously. After WikiLeaks released a trove of classified government diplomatic cables last year, U.S. Attorney General Eric Holder said the U.S. was pursuing an "active criminal investigation" of WikiLeaks.

Passed in 1986, the Electronic Communications Privacy Act is older than the World Wide Web, which was dreamed up in 1989. A coalition of technology companies—including Google, Microsoft Corp. and AT&T Corp.—is lobbying Congress to update the law to require search warrants in more digital investigations.
[WIKILEAKS] Associated Press

Attorney General Eric Holder, top, has said the U.S. is pursuing an 'active criminal investigation' of WikiLeaks.

The law was designed to give the same protections to electronic communications that were already in place for phone calls and regular mail. But it didn't envision a time when cellphones transmitted locations and people stored important documents on remote services, such as Gmail, rather than on their own computers.

Law enforcement uses the law to obtain some emails, cellphone-location records and other digital documents without getting a search warrant or showing probable cause that a crime has been committed. Instead the law sets a lower bar: The government must show only "reasonable grounds" that the records would be "relevant and material" to an investigation.

As a result, it can be easier for law-enforcement officers to see a person's email information than it is to see their postal mail.

Another significant difference: A person whose email is inspected this way often never knows a search was conducted. That's because court orders under the 1986 law are almost always sealed, and the Internet provider is generally prohibited from notifying the customer whose data is searched. By contrast, search warrants are generally delivered to people whose property is being searched.

The secrecy makes it difficult to determine how often such court orders are used. Anecdotal data suggest that digital searches are becoming common.

In 2009, Google began disclosing the volume of requests for user data it received from the U.S. government. In the six months ending Dec. 31, Google said it received 4,601 requests and complied with 94% of them. The data include all types of requests, including search warrants, subpoenas and requests under the 1986 law.

At a Senate hearing in April on whether the 1986 law needs updating, Associate Deputy Attorney General James A. Baker cautioned Congress "that raising the standard for obtaining information under ECPA may substantially slow criminal and national security investigations."

In May, the ECPA's author, U.S. Sen. Patrick Leahy (D., Vt.), said the original law is "significantly outdated and outpaced by rapid changes in technology." He introduced a bill adopting many of the recommendations of the technology coalition lobbying for changes to the law.

Some federal courts have questioned the law's constitutionality. In a landmark case in December, the U.S. Court of Appeals for the Sixth Circuit ruled that the government violated the Fourth Amendment when it obtained 27,000 emails without a search warrant.

"The police may not storm the post office and intercept a letter, and they are likewise forbidden from using the phone system to make a clandestine recording of a telephone call—unless they get a warrant," Judge Danny Boggs wrote in the 98-page opinion. "It only stands to reason that, if government agents compel an [Internet service provider] to surrender the contents of a subscriber's emails, those agents have thereby conducted a Fourth Amendment search."

In August, the U.S. District Court of the Eastern District of New York over-ruled a government request to obtain cellphone location records without a warrant, calling it "Orwellian." Judge Nicholas Garaufis wrote: "It is time that the courts begin to address whether revolutionary changes in technology require changes to existing Fourth Amendment doctrine." The government has appealed.

The WikiLeaks case became a test bed for the law's interpretation earlier this year when Twitter fought a court order to turn over records from the accounts of WikiLeaks supporters including Mr. Appelbaum.

Mr. Applebaum is a developer for the Tor Project Inc., a Walpole, Mass., nonprofit that provides free tools that help people maintain their anonymity online. Tor's tools are often used by people living in countries where Internet traffic is monitored by the government. Tor obtains some of its funding from the U.S. government.

Mr. Appelbaum has also volunteered for WikiLeaks, which recommends people use Tor's tools to protect their identities when submitting documents to its website. In April 2010, Mr. Appelbaum's involvement in WikiLeaks was inadvertently disclosed publicly in a blog post on the website of the Committee to Protect Journalists. The reporter, Danny O'Brien, said Mr. Appelbaum had thought he was speaking anonymously. Mr. O'Brien said he later offered to remove Mr. Appelbaum's name from the post.

WikiLeaks was founded by Julian Assange.

After the blog post appeared, Mr. Appelbaum became a public advocate for WikiLeaks. In June, he gave a speech at a Northern California technology camp where he called WikiLeaks founder Julian Assange one of the "biggest inspirations in my life."

On Dec. 14, the U.S. Department of Justice obtained a court order for information from the Twitter account of people including Mr. Appelbaum and WikiLeaks supporters Birgitta Jonsdottir, a member of the Icelandic parliament, and Rop Gonggrijp, a Dutch computer programmer. Neither has been charged with wrongdoing.

The order sought the "Internet protocol," or IP, addresses of the devices from which people logged into their accounts. An IP address is a unique number assigned to a device connected to the Internet.

The order also sought the email addresses of the people with whom those accounts communicated. The order was filed under seal, but Twitter successfully won from the court the right to notify the subscribers whose information was sought.

On Jan. 26, attorneys for Mr. Appelbaum, Mr. Gonggrijp and Ms. Jonsdottir jointly filed a motion to vacate the court order. They argued, among other things, that because IP addresses can be used to locate a person in "specific geographic destinations," it constituted a search under the Fourth Amendment and thus required a warrant.

The government argued that IP addresses don't reveal precise location and are more akin to phone numbers. At a Feb. 15 hearing, Assistant U.S. Attorney John S. Davis said, "this is a standard… investigative measure that is used in criminal investigations every day of the year all over this country."

On March 11, U.S. Magistrate Judge Theresa Carroll Buchanan denied the WikiLeaks supporters' motion. They have appealed.

Twitter hasn't turned over information from the accounts of Mr. Appelbaum, Ms. Jonsdottir and Mr. Gonggrijp, according to people familiar with the investigation.

The court orders reviewed by the Journal seek the same type of information that Twitter was asked to turn over. The secret Google order is dated Jan. 4 and directs the search giant to hand over the IP address from which Mr. Appelbaum logged into his gmail.com account and the email and IP addresses of the users with whom he communicated dating back to Nov. 1, 2009. It isn't clear whether Google fought the order or turned over documents.

The secret Sonic order is dated April 15 and directs Sonic to turn over the same type of information from Mr. Appelbaum's email account dating back to Nov. 1, 2009.

On Aug. 31, the court agreed to lift the seal on the Sonic order to provide Mr. Appelbaum a copy of it. Sonic Chief Executive Mr. Jasper said the company also sought to unseal the rest of its legal filings but that request "came back virtually entirely denied."
http://online.wsj.com/article/SB1000...007315072.html





NYTimes Sues The Federal Government For Refusing To Reveal Its Secret Interpretation Of The PATRIOT Act
Mike Masnick

We've been covering for a while now how Senators Ron Wyden and Mark Udall have been very concerned over the secret interpretation the feds have of one piece of the PATRIOT Act. They've been trying to pressure the government into publicly explaining how they interpret the law, because they believe that it directly contrasts how most of the public (and many elected officials) believe the feds are interpreting the law. While the two Senators continue to put pressure on the feds and to hint at the feds' interpretation, just the fact that the government won't even explain its own interpretation of the law seems ridiculous.

Given all of this, reporter Charlie Savage of the NY Times filed a Freedom of Information Act request to find out the federal government's interpretation of its own law... and had it refused. According to the federal government, its own interpretation of the law is classified. What sort of democracy are we living in when the government can refuse to even say how it's interpreting its own law? That's not democracy at all.

Julian Sanchez points us to the news that Savage and the NY Times have now sued the federal government for not revealing its interpretation of the PATRIOT Act, pointing out that if parts of the interpretation contain classified material, the Justice Department should black that out and reveal the rest, but simply refusing to reveal the interpretation entirely is a violation of the Freedom of Information Act. You can bet that the feds will do everything they can to get out of this lawsuit, just as they did with the various lawsuits concerning warrantless wiretapping. Here's hoping the court systems don't let them. No matter what you think of this administration (or the last one) and how it's handling the threat of terrorism, I'm curious how anyone can make the argument that the US government should not reveal how it interprets the very laws under which it's required to operate.
http://www.techdirt.com/articles/201...riot-act.shtml





Germany Spyware: Minister Calls for Probe of State Use
BBC

Germany's justice minister has called for a national and state level probe into the use of controversial computer software to spy on people.

The German state of Bavaria has admitted using the spyware, but claimed it had acted within the law.

Three other states have also confirmed they have used spyware in order to investigate serious criminal offences, a German newspaper reports.

Use of the software was exposed by a German hacker group.

The Berlin-based Chaos Computer Club (CCC) said it had analysed a "lawful interception" malware programme called Federal Trojan, used by the German police force.

They found that, once installed, the programme allows its operators to monitor exactly what the user is looking at - from which websites they have visited, to the emails they send and receive and the calls made through Skype.

"The malware cannot only siphon away intimate data but also offers a remote control or backdoor functionality for uploading and executing arbitrary other programs," the group wrote on its website.

The program, it said, had "significant design and implementation flaws", which made "all of the functionality available to anyone on the internet".

Strong feelings

The CCC had analysed a laptop allegedly belonging to a man accused of illegally exporting pharmaceuticals. His lawyer claims the Trojan program was installed on his client's computer when it passed through airport customs.

Bavaria Interior Minister Joachim Herrman has confirmed that state officials have been using the software since 2009 - though he made no mention of any specific incidents - and insisted that they had acted within the law. However, he promised a review of the software's use.

The German broadcaster Deutsche Welle reported on Tuesday that three other states - Baden-Wurttemberg, Brandenburg and Lower Saxony had confirmed using spyware, although it is not clear if all four states had used the same software.

Justice Minister Sabine Leutheusser-Schnarrenberger has called on the federal and state governments to launch an investigation into the matter.

"Trying to play down or trivialise the matter won't do," she said. "The citizen, in both the public and private spheres, must be protected from snooping through strict state control mechanisms."

The BBC's Stephen Evans says the incident has sparked a row because Germans, given the country's Nazi and Communist past, feel strongly about spying on citizens. Germany's constitution stipulates strict protection against it, he adds.
http://www.bbc.co.uk/news/world-europe-15253259





Calif. Governor Veto Allows Warrantless Cellphone Searches
David Kravets

California Gov. Jerry Brown is vetoing legislation requiring police to obtain a court warrant to search the mobile phones of suspects at the time of any arrest.

The Sunday veto means that when police arrest anybody in the Golden State, they may search that person’s mobile phone — which in the digital age likely means the contents of persons’ e-mail, call records, text messages, photos, banking activity, cloud-storage services, and even where the phone has traveled.

Police across the country are given wide latitude to search persons incident to an arrest based on the premise of officer safety. Now the nation’s states are beginning to grapple with the warrantless searches of mobile phones done at the time of an arrest.

Brown’s veto message abdicated responsibility for protecting the rights of Californians and ignored calls from civil liberties groups and this publication to sign the bill — saying only that the issue is too complicated for him to make a decision about. He cites a recent California Supreme Court decision upholding the warrantless searches of people incident to an arrest. In his brief message, he also doesn’t say whether it’s a good idea or not.

Instead, he says the state Supreme Court’s decision is good enough, a decision the U.S. Supreme Court let stand last week.

“The courts are better suited to resolve the complex and case-specific issues relating to constitutional search-and-seizure protections,” the governor wrote.

Because of that January ruling from the state’s high court, the California Legislature passed legislation to undo it — meaning Brown is taking the side of the Supreme Court’s seven justices instead of the state Legislature. The Assembly approved the bill 70-0 and the state Senate, 32-4.

The bill’s sponsor, Sen. Mark Leno (D-San Francisco), was flummoxed by Brown’s action. “It was a curious veto message suggesting that the courts could resolve this more effectively than the state Legislature,” he said in a telephone interview.

Under California statehouse rules, neither Leno nor any other lawmaker may introduce the legislation for at least a year.

Orin Kerr, one of the nation’s leading Fourth Amendment experts, said Brown should have backed the state’s Legislature. “I think Governor Brown has it exactly backwards. It is very difficult for courts to decide Fourth Amendment cases involving developing technologies like cellphones,” he said.

In 2007, there were 332,000 felony arrests in California alone — a third of which did not result in conviction.

Brown’s veto also shores up support with police unions and the Peace Officers Research Association of California, a police union that opposed the legislation and recently donated $38,900 to Brown’s campaign coffers. “Restricting the authority of a peace officer to search an arrestee unduly restricts their ability to apply the law, fight crime, discover evidence valuable to an investigation and protect the citizens of California,” the association said in a message.

That support would be key if Brown decides to seek a second term.

In the last year alone, at least seven police unions donated more than $12,900 each to Brown. Those unions, including the California Association of Highway Patrolmen and the Sacramento County Deputy Sheriff’s Association, had given Brown more than $160,000 in combined contributions.
http://www.wired.com/threatlevel/201...hone-searches/





'Creepy' Path Intelligence Retail Technology Tracks Shoppers
Kylie Collier

SHOPPING centres will monitor customers' mobile phones to track how often they visit, which stores they like and how long they stay.

The technology, brought to Australia by a UK-based company, has prompted a call for privacy or telephone intercept regulators to investigate.

One unnamed Queensland shopping centre is next month due to become the first in the nation to fit receivers that detect unique mobile phone radio frequency codes to pinpoint location within two metres.

The company behind the Footpath system says it is also in discussions with other major Australian sites.

Path Intelligence national sales manager Kerry Baddeley stressed that no mobile phone user names or numbers could be accessed.

"All we do is log the movement of a phone around an area and aggregate this to provide trend data for businesses,'' she said.

"It's much less intrusive or invasive than existing people-counting methods, for instance CCTV cameras and number plate monitoring.''

Australian Privacy Foundation chairman Dr Roger Clarke said emerging retail tracking techniques were "seriously creepy'' and should be thoroughly investigated.

Prominent signs should notify and seek consent from customers, he said.

Some shops are already using image-monitoring to log customers' movements, how long they stop in front of products, and whether they are male or female.

Federal Privacy Commissioner Timothy Pilgrim said the Privacy Act applied only if the information collected identified individuals.

Ms Baddeley said mobile phone monitoring, already operating in the UK and US, would help the struggling retail sector develop marketing campaigns and identify the best mix of shops in centres.

She said receivers attached to walls picked up phone transmissions. Data was then fed via the internet to computer servers to create weekly reports outlining popular customer routes and visitors' length of stay.

The shopping centre in question said it planned a public announcement once the system was running.
Retailers have been enthusiastic users of hand-held technology, with online auction site eBay yesterday announcing it planned to add image recognition to its mobile offerings early next year.

That will mean shoppers can snap photos of items they covet, such as the dress a friend is wearing, and an eBay app will find similar items for sale on its website.

The image recognition plan sounds similar to Google Inc's Google Goggles smartphone app, which lets users photograph text or certain types of objects that Google then searches for on the internet.
http://www.news.com.au/money/creepy-...-1226166413071





Apparently, FBI's 'Forensics Team' Creates Aged Photos Of Terrorists By Doing Random Google Image Searches
Mike Masnick

We've all seen those forensic "aging" pictures that are often used to try to show what a fugitive might look like now, when law enforcement doesn't have a recent photo available. I always assumed that there was some sort of science behind doing that. However, it appears that when it comes to the FBI, the way it's done is to do a Google Image search, find an image the FBI likes and then do a simple photo merge with the person they're trying to "age." Of course, that became a bit of a problem recently, when it came out that the photo the FBI used to age both Osama bin Laden and another senior al-Qaida leader, Atiyah Abd al-Rahman, happened to be a Spanish member of parliament named Gaspar Llamazares.

Llamazares is not happy about this -- especially since both of the people who his likeness was used to demonstrate have since been assassinated. He's now planning to sue the FBI. I am curious what charges he'll bring. I can't see anything really sticking, to be honest. There might be a copyright claim from whoever holds the copyright on the image -- and that would be pretty amusing, given the Justice Department's rather strong views on the absolute evils of copyright infringement. But really, the whole story seems pretty ridiculous.
http://www.techdirt.com/articles/201...searches.shtml





Who Owns the Internet?
Kate Russell

The simple answer to that question is nobody; and everybody. If you pay for an Internet connection you can consider yourself a shareholder, albeit a silent one, so shouldn’t you be a little more concerned about how it develops and the way it’s run?

This year there has been a lot of talk about social media and the part it played in the ‘Arab Spring‘. Western cultures applauded the technology as a tool of revolution, lauding its freedom and openness as a fundamental human right. But when that infrastructure was used to incite and co-ordinate mindless violence and looting in the UK riots, those same voices were heard whispering about shutting down networks to stem the free flow of information that could be used for spurious means.

But one man’s riot is another man’s revolution, right? I can imagine the questions raised in Hosni Mubarak’s private chambers on the eve of the Tahrir Square protests were not dissimilar in essence to those echoing around musty chambers of the Houses of Parliament in August of this year; “Can we stop the people talking?”

But given that the Internet is a global nervous system of gateways and networks supported and operated by thousands upon thousands of separate entities across every nation on the planet, who has the right to make those decisions and by what measure does revolution become a riot?

Enter the IGF

It is monumental questions like these that are at the heart of the Internet Governance Forum (IGF), which held its sixth annual meeting at the UN offices in Nairobi last week. But what exactly is the Internet Governance Forum? If you Google the term you’ll find surprisingly little readable information. The organisation’s own website is so shrouded in tediously cautious politi-speak that only the most hardy researchers will ever truly understand its manifesto.

Simply put, it is an annual event run by the United Nations, where anyone who has a vested interest in the running of the Internet can come together and talk openly about their position & concerns. And it is just an event and not a UN Agency, as Alun Michael, former UK minister, and now Chair of an all-party group bringing together parliamentarians, business leaders and people from civil society with an interest in Internet governance, was keen to stress:

Alun Michael: “It’s not good enough for us to do things the way we’ve done in the past by the United Nations setting up an agency to run the Internet, a sort of top-down bureaucratic approach. It’s not enough to say that there ought to be treaties and legislation, because it’s far too complex and it’s changing too quickly.”

The IGF was formed following the 2005 World Summit on Information Technology, to bridge the gap between the conflicting demands of the Internet community, who defended a bottom-up, collaborative approach where many organisations work together and no-one is in charge, and the traditional intergovernmental organisation model, which many of the world’s leaders were pushing for.

Markus Kummer is now VP for public policy at The Internet Society (ISOC), but he was also one of the people responsible for setting up the IGF. When I spoke to him, he had an interesting point to make regarding the nature of the event, and whether a so-called ‘talking shop’ can really have any impact:

Markus Kummer: “Many say it’s a weakness of the IGF that it does not have any decisions or outcomes. However, others argue that is precisely its strength because there is no pressure to negotiate anything. It allows participants to discuss freely; to voice their opinions; to think aloud and think out of the box.

“You don’t do that when you’re in a negotiating setting, when you have to be very careful because you don’t want what you say today being held against you tomorrow when it comes to agreeing on a text.”

The event itself is much like any other international conference of its ilk: a series of workshops, sessions and best-practise forums designed to get the right people sitting down together in a room and talking. The sessions all sported tediously academic titles, like ‘Blocking Content: issues, principles and paths forward’, but the discussions were anything but tedious. Put a mix of politicians, civil servants, corporations and pressure groups in a room together, with a microphone on every desk, and throw them a big juicy bone of a question like: ‘Is freedom of speech on the Internet a human right?’ and just watch the fireworks fly.

The workshop that I had flown out to Nairobi to moderate was all about how social media is changing the way we consume news. On the panel were Wael Khalil, a software engineer and political activist in Egypt; Sarah El Sirgany, Deputy Editor of Daily News Egypt; a multimedia journalism student from the UK, Lewis Fry and Ed Vaizey, UK Culture, Communications and Creative Industries Minister.

For Vaizey, who seemed relaxed and unguarded in the informal setting, it was a chance to hear opinions from people involved in media, education, industry and even representatives from charities like Childnet International, which sent a delegation of young people from the UK who impressed the hell out of everyone they met.

Ed Vaizey: “It crystallised for me the essential dilemma when you talk about social media and the Internet across a whole range of issues; which is about self-regulation by big sites like Facebook and Google, against government regulation. I naturally favour self-regulation, but I think even Facebook, Google and others want government to set the parameters, which have to be wide.”

This year’s event closed on Friday 30th September with secretariat officials describing it as the “biggest and liveliest since the institution’s inception.” More than 2000 delegates came to the United Nations offices in Nairobi, including representatives from 125 Governments. The sessions were also streamed live online, allowing Internet users from countries as far-flung as Brazil, Burundi, New Zealand, Rwanda and the United States to pose questions to the panels.

For Lord Richard Allan, Facebook’s European head of privacy, the discussions must have been closer to home this year than in any other year:

Lord Richard Allan: “Most of the infrastructure of the Internet is owned by the private sector and run by the private sector, hopefully for the public good. So for us to be here and understand the concerns that people have and to be able to talk about how we’re responding to those, I think is essential.”

Predictably, a lot of the hot topics of conversation were around access & diversity, privacy, cybercrime & protecting the vulnerable – but as this is supposed to be a forum discussing what really matters on the Internet today, one would expect the highlights to be somewhat predictable. For Lynn St. Amour, President of The Internet Society, it was events during the Arab spring that were the star of the show:

Lynn St. Amour: “Certainly the so-called Arab spring has driven a number of actions by governments across the world and they are taking a much deeper look at the Internet and what that means to their society. So we’re particularly interested in ensuring that people preserve the open nature of the Internet. That’s what gave us this tremendous value and tremendous benefit and we would like to ensure that that was there for generations to come.”

With many governments around the world now stepping up the pressure to bring control of the Internet into an intergovernmental mechanism, these conversations could be more important than ever. It was one of the major talking points in the high level ministerial meeting that happened just before the opening ceremony of the IGF, as Lesley Cowley, CEO of .uk domain register, Nominet, explained:

Lesley Cowley: “Very much from the UK we’re supporting a multi-stakeholder discussion; and that means you, me, everyone involved in the Internet having a voice at the table. I would contrast that with other countries who very much want some kind of top-down intergovernmental approach. And really for me that set the scene for this week.”

Pretty much everything in modern life is touched by the Internet. Even if you don’t spend much time online yourself, the groceries you buy, the resources you consume to run your home are all delivered by processes that have the Internet at their heart, so it’s important to everybody.

If we think of the Internet as a nervous system, the IGF is its consultant physician: a diagnostic tool used to help figure out what’s going wrong and how it might be fixed. You can be a part of that conversation next year, participating online with your questions posed to some of the most influential people in the field.

So isn’t it about time we took more of an interest in how the Internet is run? I think future generations might thank us for it.
http://thenextweb.com/insider/2011/1...-the-internet/





VeriSign Demands Website Takedown Powers
Kevin Murphy

VeriSign, which manages the database of all .com internet addresses, wants powers to shut down "non-legitimate" domain names when asked to by law enforcement.

The company said today it wants to be able to enforce the "denial, cancellation or transfer of any registration" in any of a laundry list of scenarios where a domain is deemed to be "abusive".

VeriSign should be able to shut down a .com or .net domain, and therefore its associated website and email, "to comply with any applicable court orders, laws, government rules or requirements, requests of law enforcement or other governmental or quasi-governmental agency, or any dispute resolution process", according to a document it filed today with domain name industry overseer ICANN.

The company has already helped law enforcement agencies in the US, such as the Immigration and Customs Enforcement agency, seize domains that were allegedly being used to sell counterfeit goods or facilitate online piracy, when the agency first obtained a court order.

That seizure process has come under fire because, in at least one fringe case, a seized .com domain's website had already been ruled legal by a court in its native Spain.

Senior ICE agents are on record saying that they believe all .com addresses fall under US jurisdiction.

But the new powers would be international and, according to VeriSign's filing, could enable it to shut down a domain also when it receives "requests from law enforcement", without a court order.

"Various law enforcement personnel, around the globe, have asked us to mitigate domain name abuse, and have validated our approach to rapid suspension of malicious domain names," VeriSign told ICANN, describing its system as "an integrated response to criminal activities that utilize Verisign-managed [top-level domains] and DNS infrastructure".

The company said it has already cooperated with US law enforcement, including the FBI, to craft the suspension policies, and that it intends to also work with police in Europe and elsewhere.

It's not yet clear how VeriSign would handle a request to suspend a .com domain that was hosting content legal in the US and Europe but illegal in, for example, Saudi Arabia or Uganda.

VeriSign made the request in a Registry Services Evaluation Process (RSEP) document filed today with ICANN. The RSEP is currently the primary mechanism that registries employ when they want to make significant changes to their contracts with ICANN.

The request also separately asks for permission to launch a "malware scanning service", not dissimilar to the one recently introduced by ICM Registry, manager of the new .xxx extension.

That service would enable VeriSign to scan all .com websites once per quarter for malware and then provide a free "informational only" security report to the registrar responsible for the domain, which would then be able to take re-mediation action. It would be a voluntary service.

RSEP requires all registries including VeriSign to submit to a technical and competition evaluation.

Sometimes, ICANN also opens up an RSEP question to public comment, as seems likely in this case.

But ICANN's board of directors would have the make the ultimate decision whether to approve the anti-abuse policy and the malware-scanning service.

VeriSign is already anticipating that there may be criticisms from internet users "concerned about an improper takedown of a legitimate website" and told ICANN it plans to implement a "protest" policy to challenge such decisions.

The company's move echoes policy development in the UK, where .uk registry Nominet is in the late stages of creating rules that would allow it to suspend domains allegedly involved in criminal activity at the behest of law enforcement.
http://www.theregister.co.uk/2011/10...kedown_powers/





The Little ISP That Stood Up to the Government
Julia Angwin

When Twitter fought a court order for information from the accounts of several WikiLeaks supporters, it was lauded by Wired.com as having “beta-tested a spine.”

The latest entry into the list of companies with a “spine” is tiny Sonic.net Inc., a Santa Rosa, Calif.-based Internet provider with about 36,000 customers. Sonic not only fought a secret court order for information from WikiLeaks supporter Jacob Appelbaum, but also spoke out about it.

So, who are these Sonic guys?

Sonic was founded in 1994 by Dane Jasper and Scott Doty when they were computer science students at Santa Rosa Junior College. They had been running the campus student e-mail service, and eventually decided to drop out of college to try to build a business offering Internet access accounts for $2 a month, according to the company’s corporate history.

Jasper and Doty soon realized that they needed to charge $12 a month – but they were still priced lower than the competition’s $20 a month. They operated from the back room of Mr. Jasper’s mother’s house with two computers and eight phone lines. By 2000, they had 30 employees, 15,000 customers and were working from a small office in downtown Santa Rosa, according to a New York Times article.

Sonic managed to survive the competition from big Internet dial-up competitors such as AOL by offering great customer service and avoiding taking on debt. By 2002, it had 26,000 customers and annual revenues of $4.6 million, according to an article published at the time in the Santa Rosa Press Democrat.

But Sonic’s biggest challenge – one that most small Internet service providers didn’t survive – was the broadband revolution of the mid 2000s when consumers began moving to high-speed Internet services. Because the government didn’t force the cable and phone companies to sell wholesale access to their lines – as they had for dial-up Internet service – most Internet services couldn’t compete.

So in 2006, Sonic applied for the right to become a telephone utility, which would give it the right to install its own Internet equipment – and break its reliance on equipment from the big telecommunications companies. In 2008, it became an approved public utility and began offering its own broadband connections.

Last year, Sonic began rolling out a new flagship product, Fusion Broadband – which provides speeds of up to 20 megabits as well as unlimited landline phone service. It costs $39.95.

“Essentially every large carrier in the country charges at least $50 – and as much as $80 – for a similar service,”said Dave Burstein, editor of industry newsletter DSL Prime.

Last year, Google also selected Sonic as a partner for its project to deliver super-high speed network that delivers Internet speeds of 1 gigabit per second – more than 100 times faster than the average U.S. connection.

On Aug. 1, Sonic posted a blog post called “help us protect your privacy online,” which informed users of a new policy that it would retain IP address logs for just two weeks. “Storing logs longer … would potentially make our customers the target of invasions of privacy,” the company wrote on its blog.

Seems like Sonic learned that lesson the hard way.
http://blogs.wsj.com/digits/2011/10/...he-government/





Biggest Four UK ISPs Switching to 'Opt-In' System for Pornography

David Cameron unveils deal with big four providers based on charity's proposals to protect children from sexual content
Ben Quinn

People who want to watch pornography online will have to 'opt in' with their internet service providers under measures to be announced by the PM. Photograph: Dan Chung for the Guardian

Subscribers to four of the UK's biggest internet service providers will have to "opt in" if they want to view sexually explicit websites, as part of government-sponsored curbs on online pornography.

The measures will be unveiled on Tuesday as David Cameron hosts No 10 meeting with the Mothers' Union, which earlier this year produced a raft of proposals to shield children from sexualised imagery.

The prime minister is expected to announce other moves in line with the Christian charity's review, such as restrictions on aggressive advertising campaigns and certain types of images on billboards.

There will also be a website, Parentport, which parents can use to complain about television programmes, advertisements, products or services which they believe are inappropriate for children.

The site, which will direct complaints to the regulator dealing with that specific area of concern, is expected to be run by watchdogs including the Advertising Standards Authority, BBC Trust, British Board of Film Classification, Ofcom, Press Complaints Commission, Video Standards Council and Pan European Game Information.

The service providers involved are BT, Sky, TalkTalk and Virgin. Customers who do not opt in to adult content will be unableto access pornographic websites.

Cameron gave strong backing in June to the Mothers' Union proposals after he commissioned a six-month review by the charity's chief executive, Reg Bailey. However, Cameron did not commit to legislation.

Bailey's recommendations included providing parents with one single website to make it easier to complain about any programme, advert, product or service, putting age restrictions on music videos and ensuring retailers offer age-appropriate clothes for children.

Cameron wrote to Bailey in June to thank him for his report. "I very much agree with the central approach you set out," the letter said.

"As you say, we should not try and wrap children up in cotton wool or simply throw our hands up and accept the world as it is. Instead, we should look to put 'the brakes on an unthinking drift towards ever-greater commercialisation and sexualisation'."

Bailey's report asked for government and business to work together on initiatives such as ending the sale of inappropriately "sexy" clothing for young children, for example underwired bras and T-shirts with suggestive slogans.

However, he recommended that if retailers do not make progress on the issue they should be forced to make the changes in 18 months.
http://www.guardian.co.uk/society/20...vice-providers





Reddit Shuts Down r/jailbait
Kevin Morris

Reddit administrators shut down r/jailbait, a controversial section showcasing links to photos of teenage girls, Monday afternoon.

The change came hours after users of the social news site alleged that others in the community were using the section to swap child pornography.

Here’s how the controversy began: In a thread posted late to section late Sunday night, redditor TheContortionist posted a revealing shot of a young girl’s buttocks.

“Repost Of An ex(She was 14 here),” read the post's title.

It’s typical if tasteless fare for r/jailbait, which skirts legal trouble by not allowing nude photos.

When the redditor revealed he also possessed nude photos of the girl, more than 30 redditors implored TheContortionist to send the photographs to them via personal message. (It is impossible to attach files via Reddit messages, so if any material was exchanged, the files in question would never have been posted on Reddit proper.)

But other redditors were watching. They posted screen grabs of the thread throughout the site, causing an uproar earlier today in the site’s r/WTF section and elsewhere.

At least one of the section’s moderators, I_RAPE_PEOPLE, claimed he’d quickly cooperated with Reddit staff.

According to him, staff members confirmed that child pornography had been exchanged, and “were dealing with it.”

By 8 PM Eastern time, what was once a wall of images of underage girls had been replaced with a single sentence:

“This subreddit has been shut down due to threatening the structural integrity of the greater reddit community.”

The page linked to this recent official blog post, where Reddit’s admins detailed the rights and responsibilities of the sites admins, users, and moderators (the all volunteer workforce that keeps Reddit working).

But hours after r/jailbait was banned the section was still accessible on mobile devices and apps, leading many to speculate it was all a ruse. The section’s creator, violentacrez, adamantly denied these charges.

At approxiumately 9:05 P.M., Eastern Reddit employee Max Goodman officially confirmed the section had been shut down.

The closure comes on the heels of intense public scrutiny from CNN’s Anderson Cooper, Gawker, and even Taiwan’s NMA, a producer of animated news reports.

Reddit has long viewed itself as bastion of free speech on the Web, and as a practical matter, administrators have relied on moderators to set and enforce rules on their sections, or subreddits.

But even now, in its twisted obscurity, this stew of free speech, risqué images, and rule-tweaking rebelliousness seems like a perfect expression of Reddit’s imperfect soul.
http://www.dailydot.com/society/redd...n-controversy/





As Expected, Alternative DNS Systems Sprouting Up To Ignore US Censorship
Mike Masnick

After the US government, via Homeland Security's Immigration and Customs Enforcement (ICE) division, started seizing domains without any notification or adversarial hearing (things that most of the world would consider to be reasonable due process), some folks quickly put together a browser extension, called MAFIAAfire, that would route around any ICE seizures and take you directly to the sites whose domains had been seized. This is, as the internet saying goes, a form of seeing censorship as "damage" and routing around it. Of course, that could be done on a much larger scale. As a bunch of the folks who built key pieces of the core internet infrastructure warned, continuing this kind of policy (and extending it with PROTECT IP) will lead to more workarounds that inevitably will fracture key pieces of the internet and make it significantly less secure. Supporters of PROTECT IP refuse to heed this warning -- and, from what we've heard -- refuse to compromise and make sure that the basic functioning of DNS will be protected.

So now, totally as expected, we're already seeing alternative DNS systems showing up, advertising that they should be used to route around US government censorship of such websites. The one getting attention these days is called BlockAid.me.

What's just as stunning as the fact that supporters of PROTECT IP still can't figure out how this is really, really bad, is that they also don't realize how this pretty much destroys any argument the US makes around the globe in trying to protest political censorship. Some claim it's entirely different, but it's not. Both involve a government entity deciding that websites cannot be reached without a trial. This makes the US look ridiculous in the eyes of the world, but I guess as long as it makes sure that Universal and Warner Bros. can prop up their profits for a few more years... it's all good.
http://www.techdirt.com/articles/201...nsorship.shtml

















Until next week,

- js.



















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