Peer-To-Peer News - The Week In Review - May 31st, '08

[JackSpratts]

Since 2002


































"Nokia, the world’s largest maker of cellphones, sells more phones every week than Apple has sold since the iPhone’s introduction." – Edward Snyder


"When you think of new technology, it's often the case that it takes time for the authorized uses to exceed the unauthorized use." – Michael Geist


"If Hollywood could order intellectual property laws for Christmas, what would they look like? This is pretty close." – David Fewer


"Call me a cynic but MediaDefender's actions have already spoken volumes about its ethics. The only way to root out the full story is to get these folks in front of a magistrate." – Charles Cooper


































May 31st, 2008




The Most Crazy Tech Story Since the HP Pretexting Scandal
Charles Cooper

This is one of the more bizarre stories to hit the tech world since the Hewlett-Packard pretexting scandal.

Check out the post from Revision3 CEO Jim Louderback detailing the inside story of the denial-of-service attack which crippled his company's servers over the Memorial Day weekend.

Revision3 tracked the attack back to an Internet address belonging to a subsidiary of Artist Direct, called MediaDefender. And it admitted as much when confronted with the evidence. I'll let Jim take it from here:

So I picked up the phone and tried to get in touch with ArtistDirect interim CEO Dimitri Villard. I eventually had a fascinating phone call with both Dimitri Villard and Ben Grodsky, vice president of operations at Media Defender.

First, they willingly admitted to abusing Revision3's network, over a period of months, by injecting a broad array of torrents into our tracking server. They were able to do this because we configured the server to track hashes only--to improve performance and stability. That, in turn, opened up a back door which allowed their networking experts to exploit its capabilities for their own personal profit.

Second, and here's where the chain of events come into focus, although not the motive. We'd noticed some unauthorized use of our tracking server, and took steps to de-authorize torrents pointing to non-Revision3 files. That, as it turns out, was exactly the wrong thing to do. MediaDefender's servers, at that point, initiated a flood of SYN packets attempting to reconnect to the files stored on our server. And that torrential cascade of "Hi"s brought down our network.

Grodsky admits that his computers sent those SYN packets to Revision3, but claims that their servers were each only trying to contact us every three hours. Our own logs show upwards of 8,000 packets a second.

"Media Defender did not do anything specific, targeted at Revision3″, claims Grodsky. "We didn't do anything to increase the traffic"--beyond what they'd normally be sending us due to the fact that Revision3 was hosting thousands of MediaDefender torrents improperly injected into our corporate server. His claim: that once we turned off MediaDefender's back-door access to the server, "traffic piled up (to Revision3 from MediaDefender servers because) it didn't get any acknowledgment back."

I've never heard of Grodsky but the man's brass obviously has served him well professionally. MediaDefender "did not do anything specific, targeted at Revision3?" Other than borrow Revision3's servers without permission and for its own profit, that is. (Here is where everyone can exclaim in concert, "WTF?"

At this point, Revision3 says it's not planning to file a lawsuit. Not because it doesn't have a case but pursuing a court remedy would likely cost a lot of money. But here's an opportunity for a public-regarding watchdog like the Electronic Frontier Foundation to get involved. Maybe temporary insanity will serve as a defense strategy because the emerging story boggles the imagination. And now you have to wonder whether Revision3 is the only victim or whether there are others.

Call me a cynic but MediaDefender's actions have already spoken volumes about its ethics. The only way to root out the full story is to get these folks in front of a magistrate.
http://news.cnet.com/8301-10787_3-9954993-60.html





FTC Settles with Private Investigators in HP Spy Scheme
Dibya Sarkar

The Federal Trade Commission said today it agreed to $600,000 in settlements and judgments against several private investigators involved in the Hewlett-Packard boardroom spying case.

The FTC last year filed a complaint against those investigators for allegedly obtaining consumers' private phone records without their knowledge and consent and selling them to third parties.

Palo Alto-based HP hired the investigators in 2005 to secretly examine the private telephone logs of journalists, board members and HP employees to identify the source of leaks to the media. The company admitted to the scheme in September 2006.

The FTC settlement imposed a $67,000 penalty against Matthew DePante, his father, Joseph DePante, and their now-defunct company, Action Research Group Inc., which was based in Clearwater, Fla. All but $3,000 was suspended due to their inability to pay.

The U.S. District Court for the Middle District of Florida, Orlando division, also entered default judgments against DePante's subcontractors, Bryan Wagner, who must pay $428,085, and Cassandra Selvage and her company, Eye in the Sky Investigations Inc., who must pay $110,762.

Action Research Group relied on Selvage and Wagner to get the records through pretexting, or "using false pretenses, fraudulent statements, fraudulent or stolen documents or other misrepresentations, including posing as an account holder or as an employee of a phone company," the FTC said in a release.

Selvage and Wagner were two of five private investigators believed to have acted as "pretexters" in the HP scandal.

The agency said Action Research Group sold the confidential phone records, including lists of calls made and the dates, times, and duration of the calls, since at least 2005.

The court orders also bar the defendants from obtaining and selling consumers' phone records without their consent to third parties and engage in pretexting.

The DePantes' attorneys, Richard Preira and Susy Ribero-Ayala, said both father and son maintained their innocence in the court settlement, but agreed to pay the $3,000 to settle the case.

State criminal charges were dismissed against Matthew DePante. Preira said that both father and son have gone on to other careers.

Court documents did not list attorneys for Selvage or Wagner.
http://www.siliconvalley.com/news/ci...nclick_check=1





YouTube: Viacom Challenge Threatens Internet Freedom
Larry Neumeister

A $1 billion copyright infringement lawsuit over YouTube's ability to keep copyrighted material off its popular video-sharing site threatens how hundreds of millions of people exchange all kinds of information on the Internet, owner Google Inc. said.

The company's lawyers made the claim in papers filed in U.S. District Court in Manhattan as Google responded to Viacom Inc.'s latest lawsuit alleging that the Internet has led to "an explosion of copyright infringement" by YouTube and others.

The back-and-forth between the companies has intensified since Viacom brought its lawsuit last year, saying it was owed damages for the unauthorized viewing of its programming from MTV, Comedy Central and other networks, including such hits as "The Daily Show with Jon Stewart."

In papers submitted to a judge late Friday, Google said YouTube "goes far beyond its legal obligations in assisting content owners to protect their works."

It said that by seeking to make carriers and hosting providers liable for Internet communications, Viacom "threatens the way hundreds of millions of people legitimately exchange information, news, entertainment and political and artistic expression."

Google said YouTube was faithful to the requirements of the 1998 Digital Millennium Copyright Act, saying the federal law was intended to protect companies like YouTube as long as they responded properly to content owners' claims of infringement.

On that score, Viacom says Google has set a terrible example.

In a rewritten lawsuit filed last month, Viacom said YouTube consistently allows unauthorized copies of popular television programming and movies to be posted on its Web site and viewed tens of thousands of times.

Viacom said it had identified more than 150,000 unauthorized clips of copyrighted programming—including "SpongeBob SquarePants," "South Park" and "MTV Unplugged" episodes and the documentary "An Inconvenient Truth"—that had been viewed "an astounding 1.5 billion times."

The company said its count of unauthorized clips represents only a fraction of the content on YouTube that violates its copyrights.

It said Google and YouTube had done "little or nothing" to stop infringement.

"To the contrary, the availability on the YouTube site of a vast library of the copyrighted works of plaintiffs and others is the cornerstone of defendants' business plan," Viacom said.
http://www.breitbart.com/article.php...show_article=1





RIAA Drops Allofmp3 Lawsuit; Pretends Mp3Sparks Doesn't Exist

It's been quite some time since we heard about Allofmp3, the Russian online music download store that offered extremely low prices on DRM-free downloads (you even got to pick your format). The company insisted that it was legal in Russia, and had all the appropriate licenses. Multiple times, the company was brought to court in Russia, and every time, it was found to be legitimate. In fact, the company even tried to pay royalties for the music it sold, but the recording industry refused to accept the payments.

However, the entertainment industry had US diplomats lean on Russia, claiming that if it didn't shut down the site, the US would block Russia's admittance into the WTO. So, eventually, Russia did shut down the site through somewhat questionable means. Of course, within minutes of it being shutdown, the company reappeared under the name Mp3Sparks. In fact, Allofmp3.com accounts worked just fine on Mp3Sparks. And, of course, there are a dozen or so other Russian online download stores that also offer the same sort of deal (and all of which are playing by Russian copyright laws).

For some reason, though, Mp3Sparks just hasn't received nearly as much attention as Allofmp3, and it seems like The Pirate Bay has taken on the role of "public enemy number 1" for the recording industry. So, it should come as little surprise that the RIAA has dropped its lawsuit against Allofmp3.com, saying that the company is now defunct, while totally ignoring Mp3Sparks.
http://techdirt.com/articles/20080527/0044331223.shtml





Judge Refuses To Sign RIAA 'Ex Parte' Order
NewYorkCountryLawyer

The RIAA just can't get enough of going after University of Maine students, but it appears that the judges in Portland, Maine, may be getting wise to the industry's lawyers' antics. RIAA counsel submitted yet another ex parte discovery order to the Court ("ex parte" meaning "without notice"), in BMG v. Does 1-11, but this time the judge refused to sign, pointing out that there is no emergency since there is no evidence that records are about to be destroyed. This is the same judge who has previously suggested the imposition of Rule 11 sanctions against the RIAA lawyers, accusing them of gamesmanship."
http://news.slashdot.org/article.pl?.../05/29/2259238





MPAA Threatens World’s Premier Usenet Indexer
enigmax

Newzbin, considered by many to be the internet’s premier indexer and .nzb provider, is under legal threat from the MPAA. The site, which was the creator of Usenet’s answer to the .torrent file, will likely have to undergo significant changes in order to appease the movie studios.

Newzbin is one of the original Usenet indexing sites and creators of the .NZB format. In a very general way, .NZB files might be considered Usenet’s equivalent of .torrent files. They make the otherwise-complicated Usenet a breeze to use. Downloading from Usenet with Newzbin is easy, and together with a good news provider, very quick.

The increased popularity of services such as Newzbin didn’t go unnoticed with the MPAA. On 22nd May 2008, administrator ‘Caesium’ made an announcement:

Newzbin has today received a letter from the Motion Picture Association (MPA). In the letter, they claim that some editors may be reporting material from Usenet that is infringing the copyright of their members.

While these claims have not been substantiated, it should be noted that Newzbin does not condone the distribution or indexing of such materials. We will immediately act to remove any items that are found to be infringing copyright.

Please take a moment to refer to our Terms and Conditions, in particular sections 4 and 4.2.

Please note that we may revoke privileges, or ban accounts, of users found to be violating these Terms and Conditions.

Since this announcement, worried Newzbin users have contacted TorrentFreak to see if we could find out exactly what had been going on. Understandably, Newzbin didn’t want to tell us much.

However, if one looks closely at the announcement, it doesn’t tell us anything that we didn’t already know. The terms and conditions have been in place since 2007, there doesn’t appear to be anything new in those.

Of course Newzbin doesn’t condone the indexing of copyright works. How can it? It is a proper company that charges users for access, not an underground operation hiding in the shadows. It appears to comply fully with the laws in the UK, where the service is based. Newzbin also say they will remove anything that infringes copyright. NZB files do not, so at that point they probably believed they would have little work to do.

But the MPAA isn’t known for letting the law stand in the way of a good threat, threats which have closed several US-based NZB sites in the past such as NZB-Zone and forced others to adjust the way they operate. Newzbin has not been sued, we can confirm that, but it will have to change the way it operates too, if it is to comply with the movie industry demands.

Caesium is hinting at possible changes to the site in the future. It’s a possibility that all .NZB related reports will have to be removed. An alternative to appease the MPAA would be to remove only the posts related to movies and TV shows, an arrangement favored by BinNews.com when faced with the same legal threats.

At this point it is far from clear what measures Newzbin will be finally forced to take to stop the threat of legal action turning into an actual lawsuit. Newzbin appear to be being as upfront as they can at this point and are suggesting that if users only use the site for .NZB files, then they should consider not renewing their subscription. For those who aren’t scared of making their own .NZBs ‘BinSearch’-style, the site will still be of great use, even if the most draconian measures are taken.

BinSearch provides Usenet indexing with a do-it-yourself .NZB creator. Anyone who knows the full scene release name of the material they seek will adjust to it in a few minutes, but it’s no Newzbin. For the uninformed, the learning curve is steep.

Newzbin has a secret weapon which has made it so attractive. ‘Editors‘ are essentially human beings who make reports which link to specific content on Usenet. Newzbin can then generate a .NZB file, based on the report. Anyone with an NZB capable news reader, like Grabit, can use them. It seems that it’s this human intervention with the creation of reports which poses the legal headache.

Newzbin is considering that it may have to fully automate its operations in order to be totally sure of staying the friendly side of the law - no more human intervention, no more ‘editor’ named reports. No more easily browsable pre-determined categories. A simple Usenet search engine would likely attract little attention and would be entirely legal, as confirmed by Caesium: “…we’re pretty sure nobody is going to tell us that having an automated searchable index of the entire contents of Usenet is going to cause any problems.”

But why would anyone bother using a degraded Newzbin over, say, the very useful (but limited) ‘BinSearch’? After all, there would be presumably little to separate them, feature-wise.

The plan is to introduce a feature where Newzbin users can tag. This way the site can provide an entirely legal automated index - no Newzbin staff involved - with only the users adding the tags. It sounds like a great solution and may even prove just as workable longer term.

They say every cloud has a silver lining and for Newzbin, that might come in the form of a greatly increased userbase. Newzbin is currently a subscription service but the changes may well turn it into a free site, which effectively opens it up to everyone rather than just its current paying userbase. That’s a hell of a lot of tags. Thankfully there will likely be a ratings system, to ensure quality tagging.
http://torrentfreak.com/mpaa-threate...ndexer-080528/





B.C. Man Who Runs Popular File-Sharing Website Targeted in Hollywood Lawsuit

Five years ago, Gary Fung set up a small website in his B.C. home to let visitors search for files available through a then-emerging peer-to-peer file-sharing system called BitTorrent.

What started as a hobby project to help Fung improve his programming skills has grown into one of the largest file-sharing websites on the Internet - with five paid staff members and growing advertising revenues - and has made Fung the target of a major lawsuit launched by the Hollywood film industry.

"At first, it was a side-project to learn some of the language and databases - mostly for technical reasons," says the 25-year-old Richmond man, who started isohunt.com while studying computer engineering at the University of British Columbia.

"I hosted it off my cable modem at home, so it hardly had any traffic."

But in the years since, Fung has put his studies on hold as he maintains a website that sees 18 million visitors a month, linking them to more than 25 million files ranging from music and movies to video games and software.

Fung first heard from the Motion Picture Association of America - or MPAA - more than three years ago, when the association's lawyers wrote him demanding copyrighted movies be taken down immediately.

The MPAA launched a lawsuit in a U.S. court in 2006.

Fung says he's always been watching the long list of legal cases that have dogged other file-sharing websites, prompting many to shut down to avoid costly court battles and in several instances resulting in multimillion-dollar settlements.

But, while other websites have collapsed long before their legal cases were resolved, Fung says he intends to fight the lawsuit through the courts.

BitTorrent works differently than other popular file sharing methods.

Users download a small file - called a torrent - connecting them to a tracker, which keeps tabs on who else has a particular movie, piece of music or software program.

Instead of downloading from one computer, someone obtaining a file through BitTorrent is actually downloading small pieces from hundreds or even thousands of users, as well as also uploading small pieces themselves.

Fung's site doesn't host the actual file or do the tracking - it crawls other websites looking for the small torrent files and puts them into a searchable database.

Fung argues that sites such as his simply automate the process and don't have any control over whether users share files legally or abuse the system.

"That's really a problem with the copyright system and how people want to share things. It's a social problem, and it's far beyond what we can control," says Fung, who insists he removes material if the copyright owners follow a formal complaint process.

The MPAA, however, claims BitTorrent websites like isohunt.com exist for no other reason than to trade in pirated material.

"All of them are inducing massive copyright infringement, and they are making a lot of money doing so," says John Malcolm, the association's anti-piracy director.

"All of these films that are either being hosted by these sites or to which they are providing links or torrents, are stolen movies. They're not paying any licensing fees, there is no deal with any artists, there is no deal with any studio."

Malcolm rejects Fung's argument that he's not responsible for how people use his site, saying it's not the role of copyright holders to police the Internet and ask for their material not to be shared.

"There are a lot of sites out there where copyrighted material appears, but these are businesses that have a legitimate business model that is not exclusively premised on copyright infringement in order to work," says Malcolm.

The judge in the lawsuit is currently deciding whether to hand down a summary judgment or order a full trial.

Malcolm wouldn't explain why the MPAA is pursuing its lawsuit against Fung - a Canadian - in a U.S. court, other than to say it was free to choose from a number of jurisdictions.

But industry associations have long complained that Canada's copyright laws provide a haven for movie and music pirates without much consequence.

"Canada's laws are not up to snuff, that's been recognized by all sorts of people," Malcolm says. "With respect to laws to address online piracy, they are not what they should be."

The MPAA and Fung will both be watching how Ottawa updates Canadian copyright laws with legislation expected sometime this year.

However, University of Ottawa copyright expert Michael Geist says Canada's laws already cover many forms of illegal file sharing, and he says changes to the law likely wouldn't affect sites like Fung's.

Geist, who holds the Canada research chair in Internet and e-commerce, says efforts to paint Canadian law as weak aren't fair.

"Copyright law applies online in the same way that it does offline," he says. "While we are anticipating changes in the law, I think it would be a misnomer to suggest the Internet was a free-for-all."

Trading copyrighted movies and software is already illegal, Geist says, while it is illegal to upload - but not to download - music.

There have already been several criminal cases involving online movie piracy, but those have been against individual users, not large websites.

Under both Canadian and U.S. law, Geist says, one of the issues a court would have to weigh is how much copyright infringement is occurring, compared with legitimate uses.

"They fall in a bit of a grey zone not because the law has a shortcoming, but because their activities themselves include some that are clearly permitted under the law, and some that may involve acts of infringement," says Geist.

Geist notes file sharing systems like BitTorrent are already seeing more legitimate uses.

A national Canadian broadcasting agency recently used BitTorrent to post free downloads of its "Canada's Next Great Prime Minister" program.

"When you think of new technology, it's often the case that it takes time for the authorized uses to exceed the unauthorized uses," says Geist.
http://canadianpress.google.com/arti...mnTJxfHaBD01dw





OiNK Investigation: Police Start Making Arrests
enigmax

TorrentFreak has received information which suggests that British police have made good on their claim that they would go after ex-users of OiNK. Last week, several officers arrested at least one individual for the seeding of a single album. It is believed police are in the process of arresting and questioning others.

When the OiNK tracker was shutdown in 2007, a statement appeared on the site’s homepage. This time - and unusually for the UK - it would be the police investigating a file-sharing case, not some anti-piracy group flexing their muscles in civil action. But even now, months after OiNK was shutdown, no-one - including OiNK admin Alan Ellis - has been charged with anything.

Would OiNK users really become a target for the police, despite the presumed civil status of sharing music on P2P networks? If so, why?

Right from the start, there has been a concerted effort by various elements of the music industry to portray everyday citizens using OiNK - presumably including the likes of Trent Reznor - as hardened criminals out to ruin the industry. At the time, BPI Chief Executive Geoff Taylor called OiNK a “closed criminal network” and unfortunately this type of comment set the general tone for many follow up news articles.

In reality, OiNK offered no music of its own but was the venue of an unofficial virtual party, where a limited number of people listened to music without fees or charges, in a modern take on pirate radio - but with a twist. If people had some music to share with others then so much the better, they could bring it along, add it to the index (and that’s all OiNK was, an index) and everyone could listen, to see if they liked it too.

Of all things, it was certainly not about money and a large proportion of the members wouldn’t even have considered that sharing music would result in police knocking on the door, any more than as a result of them using YouTube. But knock they did.

Last week Cleveland Police arrested a user of OiNK in the Cheshire area, who was questioned and later released on police bail. It is alleged that the individual - a normal user of the site who has no previous involvement with the police and no criminal convictions - uploaded a solitary album in early 2007.

Furthermore, information suggests that the police will be arresting and interviewing more users in the course of this investigation but at this stage it is unclear exactly who they are targeting and why. A one-off album uploader seems an unlikely target, particularly as legally in the UK, the fact that the album was allegedly pre-released - as opposed to released after retail - means little.

Going on previous cases, uploading (sharing) would be a civilly actionable offense - lawyers Davenport Lyons in the UK are happy to send out bills to those it claims uploaded its client’s games and the police aren’t interested. But for reasons no-one seems to fully understand, the police are involved in this case and have sent a car full of officers to make an arrest at the individual’s place of work, all for sharing a few minutes of music.

Another issue up for debate is the big question mark sitting over the usefulness of site logs. Stats are manipulated all the time for one reason or another and trackers have to rely on a user’s torrent client reporting data correctly. To be anywhere close to proving infringement it is necessary to track the transfer of data from within the swarm by directly receiving data from the uploader. This is fairly trivial, does not require the site logs and importantly should’ve been done at the time the album was uploaded. Why there has been such a huge delay in taking further action is unknown.

Last year saw an unexplained shift in the way copyright actions are dealt with in the UK. Out of nowhere, both OiNK and the popular TV-Links sites were taken down by police action where one would usually expect a civil lawsuit, leaving prominent legal experts intrigued as to the legal basis.

Uploading one album is not the world’s most heinous crime, in fact, unless the UK legal system changed overnight, it’s not a crime at all since there would’ve been no commercial gain for the user. So what route is this investigation taking? What is the significance of arresting this individual and investigating others over a seemingly small civil issue, and why has it taken so long to do so?

As usual, there are more questions than answers. The arrests have started, but it is unknown how many people are involved. We contacted the Police department that was responsible for at least one arrest, however, they did not respond to our inquiries. If you have any information, please contact TorrentFreak here, as we will post an update of the arrests later this weekend.
http://torrentfreak.com/oink-investi...rrests-080530/





Proposed Secret Copyright Deal Takes Aim at iPods, Providers
Vito Pilieci

The Canadian government is secretly negotiating an agreement to revamp international copyright laws which could make information on iPods, laptops and other personal electronic devices illegal and greatly increase the difficulty of travelling with such devices.

The agreement could also impose strict regulations on Internet service providers, forcing those companies to hand over customer information without a court order.

Called the Anti-Counterfeiting Trade Agreement (ACTA), the new plan would see Canada join other countries, including the United States and members of the European Union, to form an international coalition against copyright infringement.

Details of the agreement, which is expected to be tabled at July's meeting of G8 nations in Tokyo, were leaked on the Internet on Friday.

The agreement is being structured much like the North American Free Trade Agreement, except it would create rules and regulations regarding private copying and copyright laws. Federal trade agreements do not require parliamentary approval.

The agreement would create an international regulator that would turn border guards and other public security personnel into copyright police. The security officials would be charged with checking laptops, iPods and even cellular phones for content that "infringes" on copyright laws, such as ripped CDs and movies.

The guards would also be responsible for determining which content infringes on copyright laws.

The agreement also proposes that any content copied from a DVD or digital video recorder be open for scrutiny by officials - even if the content was copied legally.

"If Hollywood could order intellectual property laws for Christmas, what would they look like? This is pretty close," said David Fewer, staff counsel at the University of Ottawa's Canadian Internet Policy and Public Interest Clinic.

"The process on ACTA so far has been cloak and dagger. This certainly raises concerns."

The leaked ACTA document states officials should be given the "authority to take action against infringers (i.e., authority to act without complaint by rights holders)".

Anyone found with infringing content in their possession would be open to a fine. They may also have their device confiscated or destroyed, according to the four-page document.

The proposal includes "civil enforcement" measures which would give security personnel the "authority to order ex parte searches" (without a lawyer present) "and other preliminary measures."

In Canada, border guards already perform random searches of laptops at airports to check for child pornography. ACTA would expand the role of those guards.

On top of these relatively small-scale enforcement efforts, ACTA also proposes imposing new sanctions on Internet service providers. It would force providers to hand over personal information pertaining to "claimed infringement" or "alleged infringers" - users who may be transmitting or sharing copyrighted content over the Internet.

Currently, rights holders must collect evidence to prove someone is sharing copyrighted material over the Internet. That evidence is then presented to a judge who can issue a court order telling the Internet service provider to identify the customer.

Mr. Fewer has been following the progress of ACTA and has exhausted every avenue at his disposal to gain insight into its details. He said Friday's leak of the "discussion paper" which outlines the priorities of the agreement is the first glimpse anyone has had into ACTA.

"We knew this existed, we filed an Access to Information request for this, but all it provided us with was the title. All the rest of it was blacked out," he said.

"Those negotiations can take place behind closed doors. At the end of the day, we may be provided with something that has been negotiated which is a fait accompli in which civil society gets no opportunity to critique it."

Mr. Fewer expressed particular concern about one area of the proposal that calls for ACTA to operate outside of accepted international forums such as the World Trade Organization, the World Intellectual Property Organization or the United Nations.

The document proposes that ACTA create its own governing body and be overseen by a committee made up of representatives from member nations. Organizing its own governing body would make ACTA unaccountable to any existing international trade organization.

"This initiative is unprecedented," he said.

The paper was leaked online by Sunshine Media, the company that runs the Wikileaks.org website - a whistleblowing site created to help circulate secret documents.

In October, David Emerson, minister of International Trade, announced that Canada would take part in ACTA's creation. The initiative was originally aimed at stopping large-scale piracy, such as printing operations that make and sell thousands of copies of movies that are still showing in theatres.

"We are seeking to counter global piracy and counterfeiting more effectively," Mr. Emerson said at the time. "This government is working both at home and internationally to protect the intellectual property rights of Canadian artists, creators, inventors and investors."

The document is reported to have been drafted by the Office of the United States Trade Representative. A spokeswoman with the office refused to comment on the document.

Michael Geist, Canada research chair of Internet and E-commerce law at the University of Ottawa and expert on Canadian copyright law, criticized the government for advancing ACTA with little public consultation.

He said documents detailing ACTA's plans would not need to be leaked online if the process were transparent.

"That's what happens when you conduct all of this behind closed doors," he said. "The lack of consultation, the secrecy behind it and the speculation that this will be concluded within a matter of months without any real public input is deeply troubling."

The Department of International Trade said they would not comment on the document.
http://www.canada.com/ottawacitizen/...7-56ac6d28e822





Net Neutrality Bill Hits House of Commons
Peter Nowak

NDP digital spokesman Charlie Angus doesn't believe the CRTC has all the tools it needs to prevent interference in the internet by service providers

The NDP has followed through with its promise to introduce legislation to the House of Commons that seeks to keep the internet open and free from control by service providers.

"This bill is about fairness to consumers," said Charlie Angus, the NDP's digital spokesman, in the House of Commons on Wednesday. "The internet is a critical piece of infrastructure not just for Canada but for the world ... this bill protects the innovation agenda of Canada."

The private member's bill, C-552, is in reaction to moves by some of Canada's largest internet service providers (ISPs), including Bell Canada Inc. and Rogers Communications Inc., to limit their customers' uses of the internet. Bell, Rogers and a few others say a small percentage of customers have been congesting their networks by using peer-to-peer applications such as BitTorrent, so they have slowed the internet down at peak times of the day.

The ISPs' actions have provoked outrage from internet users, with about 300 protesters taking to the steps of Parliament Hill on Tuesday. Critics have said the targeting of peer-to-peer applications is just the tip of the iceberg. If ISPs are allowed to decide which internet applications can and can't be used, innovative new companies that were born from experimentation — such as Google, Amazon and eBay — may not happen in the future.

"Net neutrality affects everybody, every person, every business, every hospital, every institution is involved in the exchange of information over the internet," Angus told CBCnews.ca. "This shouldn't be about party lines."

The four-page bill seeks to amend the Telecommunications Act and "prohibit network operators from engaging in network management practices that favour, degrade or prioritize any content, application or service transmitted over a broadband network based on its source, ownership or destination, subject to certain exceptions."

It also looks to prohibit "network operators from preventing a user from attaching any device to their network and requires network operators to make information about the user's access to the internet available to the user."

The proposed bill makes exception for ISPs to manage traffic in reasonable cases, Angus said, such as providing stable speeds for applications such as gaming or video conferencing.

"There are areas where telecoms have to be able to exercise rights, but that doesn't give them the ability to arbitrarily interfere or discriminate," Angus said.
NDP wary about government intervention

The NDP is "very wary" about the government intervening in the internet, Angus told the House of Commons. But the bill isn't about regulating the internet, it's about ensuring there will be scrutiny of those who provide access to it, he said.

Now that the bill has been tabled, it has to wait to be called up in private members' business in the House. Angus is far down on the randomly generated list that determines the order in which members are scheduled to present their bills or motions, but he said he will try to trade positions with another party member to bring it up the list for discussion.

The point of the bill, Angus said, is to give MPs who otherwise have no idea what net neutrality is a reference point. It also gives critics a focal point for their arguments.

Officials at Bell and Rogers did not immediately return requests for comment.

A spokesperson for Minister of Industry Jim Prentice also did not immediately return a request for comment. The spokesperson also did not reply to requests for comment on the net neutrality rally.

Prentice earlier this month told the House that the government was against regulating the internet and would leave the matter to be resolved by ISPs and their customers.

Scott Brison still to weigh in

Liberal industry critic Scott Brison has not weighed in on the issue, despite having held meetings with Bell, Rogers and several smaller ISPs a few weeks ago. His spokesman did not reply to a request for comment on Wednesday.

Liberal MP Mauril Belanger spoke at the rally on Tuesday and said he was in favour of net neutrality, but added that the Canadian Radio-television and Telecommunications Commission already has all the tools it needs at its disposal to punish abuse by ISPs.

Section 27 (2) of the Telecommunications Act says: "No Canadian carrier shall, in relation to the provision of a telecommunications service or the charging of a rate for it, unjustly discriminate or give an undue or unreasonable preference toward any person, including itself, or subject any person to an undue or unreasonable disadvantage."

Section 36 also says: "Except where the commission approves otherwise, a Canadian carrier shall not control the content or influence the meaning or purpose of telecommunications carried by it for the public."

Despite those two sections, Angus said CRTC chairman Konrad von Finckenstein told the Standing Committee on Canadian Heritage two weeks ago that the regulator did not have sufficient means to punish ISPs violating the rules. Finckenstein said the CRTC needs the ability to impose monetary penalties for violating both the Telecommunications and Broadcasting Acts.

"It is something we need in our tool box," he said.
http://www.cbc.ca/technology/story/2...h-netbill.html





Stuck with Analog Rights in Digital World
Michael Geist

Earlier this month, some fans of the NBC television programs American Gladiators and Medium found themselves unable to digitally record the shows on their personal computers. The reason for the blocked recordings raises important technical and legal questions about the rights of consumers to "time shift" television programs in the digital era.

The blocked recordings affected people that record television programs on their personal computers using the Microsoft Windows Vista Media Centre. Most people are unaware that Microsoft has inserted a feature that allows a broadcaster or content owner to stop the digital recording of a show by triggering a "broadcast flag" that specifies its preference the show not be recorded. When the user tries to record it, Microsoft's software recognizes the flag and issues a warning that the program cannot be recorded.

While there was speculation that the NBC broadcast flag was triggered accidentally, the incident provided an important reminder about the current fragility of consumer digital rights. The law in the U.S. has granted consumers the rights to time shift programs for decades, yet broadcasters can seemingly stop the ability to record programs in the digital world with the flick of a switch.

Cable providers enjoy similar capabilities. Digital cable boxes used by companies such as Rogers and Shaw include a CableCard that allows users to watch and record digital television shows. The CableCards feature functionality (technically known as CGMS-A) that allows broadcasters and cable companies to establish limits on recording programs.

Programs are broadcast with one of three specifications – copy freely, copy once, or copy never. The copy never specification is typically used for pay-per-view or video-on-demand programming. As the recent NBC incident illustrates, however, there is the potential for far broader restrictions. In fact, Internet chat sites are filled with postings from aggrieved Canadian consumers who claim that they have been blocked from recording a wide range of television shows.

As broadcasters and content owners increasingly sell or stream their content online, the incentives to block consumers from making their own recordings grows. In the United States, the law restricts the ability to block digital recordings, since cable companies face potential fines for blocking content that is not either video on demand or pay-per-view. There are no similar restrictions in Canada.

Not only are Canadians more vulnerable to abusive use of a broadcast flag, but their rights to even record "copy freely" programs are open to question. The Canadian Association of Broadcasters recently told the CRTC that consumers who record television shows for later viewing, whether on a VCR or PVR, violate the law.

There has been recent speculation that Industry Minister Jim Prentice will soon introduce new legislation that would legalize time shifting in Canada. However, the use of broadcast flags or other recording restrictions in Canada suggests that the legal reform may be too little, too late.

Creating a Canadian time shifting provision might allow for the recording of analog television programs that cannot be blocked through a CableCard or the Windows Vista Media Centre. In the digital world, however, the new right will be illusory since technology can be used to trump the law. Moreover, Prentice may actually make it illegal to circumvent the blocked recordings, meaning that Canadians that attempt to exercise their rights to record television programs in the digital environment could face the prospect of tens of thousands of dollars in liability.

Addressing the rights of Canadians to record television programs is long overdue. In tackling the issue, Prentice must be sure to avoid merely providing Canadians with analog rights in a digital world.
http://www.thestar.com/article/429825





Did Deutsche Telekom Spy on Journalists and Board Members?

German telecommunications giant Deutsche Telekom stands accused of having monitored telephone calls of business journalists, board members and shareholders. An anonymous fax may result in a criminal investigation.

Had it not been for the money, there is a good chance that the entire "unsavory story" -- as a senior executive at German telecommunications giant Deutsche Telekom AG called it last week -- would never have come to light. Most of all, though, it was a fax that revealed the story -- and exposed an absurd concoction of economic spying, power-hungry megalomania, paranoia, and a complete disregard for the freedom of the press.

The fax arrived at the company's headquarters in Bonn about four weeks ago, addressed to the head of Telekom's legal department. And the threatening undertones seemed difficult to ignore, especially given the words that appeared at the end of the three-page document, which SPIEGEL has obtained: "You should not underestimate my aggressive potential and my staying power."

It was, at the very least, a reckoning in two parts: The head of a Berlin management consulting company, from whom the fax came, was calling on Telekom's head lawyer to contact him without delay. The goal, he wrote, was to achieve "a controlled termination of our business relationship protected against indiscretion." At the same time, the letter was the formal end to long-term activities that apparently served one overriding purpose: to spy on German business journalists, members of the supervisory board and senior company executives, including monitoring their telephone communications with one another.

Journalists, Board Members and Shareholders

The company itself, led by then CEO Kai-Uwe Ricke and monitored by a supervisory board headed up by then Deutsche Post CEO Klaus Zumwinkel, is accused of being behind the alleged spying. And the Berlin consulting firm, whose chief executive sent the April 28 fax, was hired to carry it out. The goal of the "Clipper" and "Rheingold" surveillance programs, as well as other "secondary projects," the fax makes clear, was to "analyze several hundred thousand landline and mobile connection data sets of key German journalists reporting on Telekom and their private contacts."

But that wasn't all. The same procedure, according to the memo, was repeated with "several supervisory board members on the employee side" -- "for a total period of one-and-a-half years."

Other spying campaigns had already been "specifically planned and assigned," including "the surveillance of one of your shareholders, a company headquartered in New York." This is likely a reference to Telekom shareholder Blackstone. Moreover, the letter continues, the office of an "important business journalist," had been infiltrated by a mole who had reported "directly to corporate security" at Telekom for several months. The head of the security company leaves no doubt that "the projects, even by intelligence standards, can be described as unusually broad and sophisticated."

All of this, according to written allegations, was ordered "directly by management (in close cooperation with the then chairman of the supervisory board) and paid for directly by the chairman of the board, through the office of the supervisory board." But apparently not all fees were paid and a dispute eventually erupted.

It is still unclear how much of the alleged spying operation is in fact true. Telekom confirmed that it has turned the matter over to the public prosecutor's office. Company representatives, citing the ongoing investigation, have declined to comment on details of the case but said the operation was apparently coordinated with the supervisory board and its chairman. "We take this situation very seriously. We will do everything within our power to support the prosecutor's office in its efforts to conduct a thorough investigation," says current Telekom CEO René Obermann.

A Host of Criminal Charges

Lothar Schröder, Telekom's chief union negotiator and deputy head of the supervisory board, who may have been a target of surveillance himself, is outraged: "If the accusations are confirmed, it would be an unprecedented breach of trust and an unbelievable scandal, and those responsible for it should be brought to justice as quickly as possible." Schröder nevertheless said that he was convinced the current management is interested in a speedy and thorough investigation.

Obermann reacted immediately when the security department first became aware that something was amiss. The head of security was replaced and the entire department was completely reorganized. In addition to reporting the incident to the chancellery and the Finance Ministry in Berlin, Obermann forwarded the entire case to the office of the public prosecutor in Bonn. The task that office now faces is to determine who may have been guilty of what crimes in the period between 2005 and 2006 -- a period when Obermann's predecessor Ricke was still in charge of the company. Investigators are still examining the extensive Telekom material and have not yet launched an official investigation.

But such an investigation, company officials believe, is only a matter of time. Even if only a fraction of the allegations are true, the company could face a host of criminal charges, ranging from violation of the secrecy of telecommunications to bribery and even extortion.

There were many indications last week that at least some low-level spying must have taken place against several labor representatives and members of the supervisory board, including Wilhelm Wegner, the head of the group works council. There was also mounting evidence that agreements had in fact been made with the Berlin-based company that contacted Telekom in February to demand payment of supposedly unpaid invoices ranging in the six figures. Moreover, there are indications that former CEO Ricke and his Supervisory Board Chairman Zumwinkel were frustrated that reports of confidential board meetings were repeatedly leaked to the press.

Trouble Was Brewing

The Berlin consulting firm was allegedly hired in the spring of 2005 to explore where the leaks could be coming from. The firm was asked to compare the telephone records of members of the supervisory board with those of well-known business journalists who reported on Telekom.

The snooping campaign against the head of the works council happened in a turbulent phase for Telekom. Following the dramatic plunge of Telekom's stock from a high in March 2000, CEO Ron Sommer resigned in July 2002 under pressure from the German government, a major shareholder in the company. Ricke took over the post in November. He reorganized Telekom management and turned his back on his glamorous predecessor's global visions. With his tough cost-cutting measures and the sale of several divisions Ricke, whose father had also run Telekom in the past, returned the company to financially sound footing.

Even analysts and shareholders began to respect the awkward and graying Ricke. But trouble was brewing inside Telekom. Employees were becoming increasingly concerned about job security. In early 2005, Ricke had announced that Telekom would have to cut at least 8,500 jobs a year in the future.

Searching for the Moles

When members of the works council began mentioning a figure of roughly 45,000 jobs that the company planned to eliminate by 2008, the service workers' union Ver.di became involved. Ver.di made its deep opposition to the job cuts clear when it referred to Telekom's plans as "clear-cutting," "an outrage" and a "scandal when it comes to employment policy."

Ricke relented. The members of his executive board -- especially René Obermann, head of the mobile division at the time, and Walter Raizner, head of the landline division, T-Com -- were already deeply suspicious of one another, and treated each other as rivals more than colleagues. The discord made it all the more attractive for the press to report on internal meetings.

The environment in which the company was operating changed dramatically during this period. The landline business faced growing competition from small upstart providers, leading to sharp declines in prices and sales. The boom in fast DSL Internet connections had only just begun and had yet to yield the anticipated results. Even the mobile telephony business was no longer achieving the growth rates of earlier years. But while major European competitors adjusted to the new realities by gradually breaking down the classic barriers between mobile telephony, landlines and the Internet, senior executives at Telekom headquarters in Bonn were unable to agree on a strategy for the company. The constant endless meetings didn't help, ending, as they often did, in half-hearted solutions poorly suited to solving Telekom's problems.

The direct consequences were customer flight, crumbling earnings and an ongoing decline in the company's stock price. Criticism of the company grew even further when US investment group Blackstone bought a slice of Telekom in 2006.

Speculation over replacement of the indecisive Telekom CEO began circulating in the press, fueled by internal memos from meetings of the executive and supervisory boards that could only demonstrate one thing: that Ricke was indecisive and wavering. His tenure as CEO quickly came to an end after that. Supervisory Board Chairman Zumwinkel forced the hapless chief executive to resign and replaced him with Obermann.

'As Full of Holes as Swiss Cheese'

That was in November 2006, the date when Telekom now assumes the spying came to an end. The author of the fax from Berlin, on the other hand, claims "we can prove that we were still involved in the 'Clipper' project after November 2006." The fax says one only need to ask people like Zumwinkel or Ricke.

At the end of last week, both executives sharply denied having had any knowledge of specific eavesdropping activities. But former CEO Ricke also did not deny that Telekom, during his tenure, repeatedly tried to find leaks within the company. "Telekom," said Ricke, "was as full of holes as Swiss cheese." According to Ricke, internal documents were repeatedly leaked to the public, especially during the second half of his term, "some of which contained information that could affect the stock price" -- about planned acquisitions abroad, for example, or planned job cuts.

Speaking to SPIEGEL last Friday, Ricke said: "We discussed this often in the executive board, and we decided to take active steps to combat it." In consultation with Supervisory Board Chairman Zumwinkel, the corporate security department, which was then headed by Labor Director Heinz Klinkhammer, was "many times assigned to complete the necessary investigations."

Several steps were taken to expose the informants, including applying individual, secret codes to all executive board documents. Occasionally, documents containing false information were distributed before executive board meetings, the goal being to determine "which pieces of information are reaching which press organizations."

In some cases, the corporate security department "hit pay dirt after some detective work." Ricke, however, insists that he was unfamiliar with the methods that the department's several hundred employees used, emphasizing: "I never gave illegal orders at the time, and certainly never asked anyone to eavesdrop on telephone connection data."

A spokesman for Zumwinkel issued a similar statement: "A supervisory board director cannot give instructions to employees of the company. The alleged storage of data occurred, if at all, without the consent of the then supervisory board chairman." The spokesman went on to say: "It's a good thing that the alleged procedures and incidents are being investigated."

Required by Law to Protect Confidentiality

Both men have said that they are not willing to rule out the possibility that the eavesdropping campaigns existed. They also insist that they had no knowledge that anything illegal was taking place.

Telekom's underhanded use of data is being exposed at a time when the government is holding the Bonn-based company to extremely high standards, in terms of both data confidentiality and trustworthiness. As of Jan. 1, all telephone and Internet providers in Germany are required to keep all connection data on file for six months. This reflects an EU decision reached after the 2004 Madrid terrorist attacks, as well as the wishes of German investigators. Otherwise, they fear, all evidence could already be deleted if they happen upon a suspect months after a crime was committed and then attempt to unravel the network of accomplices.

But this makes industry leader Telekom into something of a law enforcement arm of the state, now more than ever. And it makes it all the more embarrassing that the company is now under suspicion of having abused the wealth of data at its disposal.

Just how sensitive such data is, whether collected by Telekom or other telecommunications companies, was made clear by Germany's high court in March when it significantly narrowed the scope of new regulations governing data storage. Under the ruling, investigators can only gain access to the telephone records of suspects charged with serious crimes that carry a potential prison sentence of more than five years. In all other cases, Telekom is required to preserve the secrecy of its customers' data.

But now Telekom's old management has come under the suspicion that it was less than trustworthy for many years, and not just with the personal data of its own supervisory board members and executives. The attempt to match up the board members' and executives' phone records with those of journalists suggests a stunning disregard for democratic values.

Courts in the past have tightened the reins several times on investigators who were eavesdropping on journalists with the intent of uncovering their sources within government agencies and judicial bodies. Thus, for example, the German Constitutional Court declared the search of the Cicero editorial offices in 2004 to have been illegal. An attempt by authorities in the state of Saxony to use the telephone records of a Dresdner Morgenpost journalist in an investigation was likewise struck down.

And it was revealed in 2006 that the Bundesnachrichtendienst (BND), the German foreign intelligence agency, had illegally placed journalists under surveillance for years while searching for a mole in its own ranks. As recently as a few weeks ago, the federal government had to issue a public apology when it was revealed that the BND had lapsed back into its old practices with SPIEGEL reporter Susanne Koelbl.

It should have been clear to the Telekom executives that by scanning employees' and board members' telephone records for calls made to journalists, they were not just operating in a gray area, but in a forbidden zone. In that zone, putting too much trust in the head of a Berlin consulting is apparently a dangerous thing.

According to the letter from that company manager, the situation had become "extremely threatening" to him and his company. If his fax were to be passed on to third parties other than Telekom CEO Obermann, the company would have to "interpret it as a declaration of war," the manager wrote, adding that he does not wish to lose the opportunity to defend himself "in the media, if necessary."

He is likely to have that chance very soon.

By Beat Balzli, Jürgen Dahlkamp, Frank Dohmen and Klaus-Peter Kerbusk

Translated from the German by Christopher Sultan
http://www.spiegel.de/international/...555363,00.html





Global Dreams for a Wireless Web
John Markoff

Menorca, Spain

SITTING on the porch at Finca Torrenova, his 800-acre retreat on this Mediterranean island, Martin Varsavsky ticks off the credentials of the group of Internet entrepreneurs finishing lunch at a nearby table.

“He has 40 million uniques, he has 50 million, and he has 8 million,” Mr. Varsavsky says, referring to the number of visitors to Web sites owned by his guests — many of whom are also business associates and have joined him for several days of brainstorming about the digital future.

These days, commercial victory on the Internet is all about scale, and Mr. Varsavsky, a 48-year-old from Argentina, can be forgiven for speaking longingly and in detail about his peers’ achievements. No stranger to success — he has had a tidy crop of new media and telecommunications hits since the 1990s — he is still struggling to bring his newest Internet venture to fruition.

Three years ago, aiming to create a global wireless network, he founded FON, a company based in Madrid that wants to unlock the potential power of the social Internet. FON’s gamble is that Internet users will share a portion of their wireless connection with strangers in exchange for access to wireless hotspots controlled by others.

The swaps, in theory, would allow “Foneros” to have ubiquitous, global wireless access while traveling for business or pleasure. But despite $55.2 million in backing from such corporate heavyweights as Google and BT, the former British Telecom, as well as newer enterprises like Skype and a handful of venture capital firms, FON and Mr. Varsavsky are still missing a crucial ingredient: scale.

At the moment, there are just 830,000 registered Foneros around the world, and only 340,000 active Wi-Fi hotspots run FON software. Because it’s built upon the concept of sharing Wi-Fi access, FON works well only if there are Foneros everywhere.

And as he struggles to expand the FON network, Mr. Varsavsky faces particular hurdles now that the Internet’s commercial side has reached a crossroads. Born a few decades ago as an anarchic, digital version of a barn-raising, the wireless Internet is now a battleground between two giant technology consortiums seeking to rein in the Web’s chaotic openness in favor of creating uniform, global access built upon wireless data networks.

The two camps, known as WiMax and L.T.E., for “long-term evolution,” are both top-down, highly structured approaches that will cost billions of dollars to build and may close a door on some of the architectural openness that led to the rapid growth of the Internet.

But their potential advantage is that closed standards can encourage the kind of growth that offers more access to mainstream consumers and business users, as occurred when Microsoft imposed a measure of conformity on software development.

For his part, Mr. Varsavsky hopes that FON can offer a middle ground — deploying the original, bottom-up strengths of the early Internet movement and at the same time wedding them to a more formal, corporate approach to expansion.

Although FON faces huge obstacles in realizing those ambitions, the company also has a growing number of devotees.

“The wireless Internet market today is fragmented and complex — it can be accessed through 3G operators, through WiMax, through private hotspots, through paid hotspots and through corporate networks,” said Michael Jackson, a partner at Mangrove Capital in London and a former FON board member. “In summary, it is a nightmare for a consumer. FON can and will change this.”

But others have their doubts.

“I know that the people at Google like this idea,” said John Saw, the chief technology officer at Clearwire, the WiMax start-up of Craig McCaw, which recently announced a $14.5 billion joint venture to build a nationwide WiMax network with Sprint, Google, Intel, Comcast and others. “But we’re skeptical.”

Undeterred, Mr. Varsavsky says that what he currently lacks in scale he can make up for in huge cost savings, particularly because FON avoids the expensive proposition of having to build a worldwide network of cellular towers and Wi-Fi nodes from scratch.
“Our army of Foneros is a much more efficient way of distributing a signal,” he says. “We believe WiMax operators will be happy to have some customers use their services for free and save billions in infrastructure deployment.”

MR. VARSAVSKY has worked overtime trying to line up more high-profile partners for FON. To that end, he traveled to Cupertino, Calif., last fall to meet with Steve Jobs, the chief executive of Apple.

During that 90-minute meeting, Mr. Varsavsky says, the two men discussed why a partnership might make sense.

Apple has sold millions of its Wi-Fi routers to residential customers, and its community of Wi-Fi users who share router access would be an ideal platform for FON. For his part, Mr. Jobs had developed an interest in Wi-Fi sharing because of the expanding number of iPhone users who are often frustrated by locked Wi-Fi access points.

But, Mr. Varsavsky says, from the moment that he and Mr. Jobs met, their discussion devolved into an argument. (Mr. Jobs did not respond to requests to comment on the meeting.)

At the outset, Mr. Varsavsky recalled, Mr. Jobs asked sharply, “Who needs your community?” and “Why should British Telecom bother to do a deal with you, and why shouldn’t people just leave their routers open for sharing?”

Mr. Varsavsky says he responded, “Why should you bother to do a deal with AT&T? Shouldn’t iPhones just be connected freely with any cellphone network?”

Mr. Varsavsky says he left the meeting with the uncomfortable feeling that Apple might end up as a competitor rather than as a partner. But it wasn’t only because of Mr. Jobs’s legendary stubbornness that the Apple meeting apparently went awry. Mr. Varsavsky’s own substantial ego also came into play — something he freely acknowledges when he talks about how he first got into business.

“My father died and my mother was saying, ‘Martin, get a job, get a job,’ ” he recalls. “And I would go to job interviews and they would say, ‘How do you see yourself in five years?’ And I would say, ‘Well, at least as your boss!’ ”

That attitude surfaced in other forums as well. In high school in Argentina during the 1970s, he says, he persuaded classmates to open their own office supply store to compete with a store across the street from their school. He also declared his interest in left-leaning politics, which he said attracted the attention of the Argentine military junta that was purging high schools of dissidents. In the “dirty war” of 1976-83, the government killed thousands it suspected of being leftists.

An officer told the school to expel him, Mr. Varsavsky says, and he left for Brazil. Around the same time, he believes, his cousin was kidnapped and killed by the military. The Varsavsky family fled to the United States, and Mr. Varsavsky earned his undergraduate degree in economics and philosophy at New York University in 1981. He later attended Columbia University, where he received graduate degrees in international affairs and business administration.

MR. VARSAVSKY says start-ups got into his blood during graduate school, when he made his first million in a real estate foray: renovating and reselling lofts in New York.

After moving to Spain in the 1990s, he had three big telecommunications and Internet successes. He says that a $200,000 investment he made to start a long-distance company, Viatel, in 1990 was worth about $240 million when he cashed in his stake in 1999; that the 5 million euros he used to start Jazztel in 1997 has given him a stake now worth about 150 million euros; and that the 38 million euros he used to start a Spanish Internet service provider, Ya.com, in 1999 had grown to about 149 million euros when he sold the company the next year.

Then, after this first round of success, Mr. Varsavsky was hit with a loss that he describes as a striking, gut-wrenching failure. His German start-up EinsteinNet, founded in 2000 as an effort to sell software over a private fiber optic network, collapsed in 2003, leaving him with a personal loss of $50 million.

“I used the most money of my own in a company where I lost it all, and I consider it my business black eye,” he recalls, saying that he also drew a valuable lesson from the misadventure: “I don’t invest on my own. If other people don’t want to back me, it’s a sanity check.”

TO that end, Mr. Varsavsky has become a tireless networker, traveling the world to participate in a continuous parade of technology conferences and cultivating a global retinue of friends and contacts. He has also been active on the philanthropic front, earning kudos from a onetime resident of the White House.

“Martin represents the future of entrepreneurial culture and is helping to transform the way people give,” former President Bill Clinton says. “He has found different ways to use his acute business sense and creativity to improve our world and the lives of others.”

This month, Mr. Varsavsky brought together more than 70 Internet business people and technologists from Europe, Asia, Latin America and the United States for a conclave on his Menorca farm. Some guests represented the more than 20 digital enterprises in which he has a stake; others were “friends of Martin,” a loose-knit group that comprises his informal business network around the world.

The four-day conclave featured several unscripted “tech talks” in which entrepreneurs described problems they faced building their businesses. Participants included Lukasz Wejchert, the chief executive of Onet, Poland’s dominant Internet portal.

Deals with companies like Onet will be crucial if Mr. Varsavsky is to make good on his goal of having a million FON customers on each of three continents by 2010. The two companies recently came close to a deal, Mr. Wejchert says, but Onet decided that it was still to early for it to become an Internet service provider in Poland because the regulatory environment worked against new entrants.

That major players like Onet are beginning to find FON a potentially profitable partner is promising, and Mr. Varsavsky’s formidable networking abilities with politicians and entrepreneurs are also a plus. Ultimately, however, FON’s success will hinge on its strategic soundness and operational prowess — not on Mr. Varsavsky’s skills at working the cocktail circuit.

He likes to refer to FON as a “revolution,” but so far his crusade has had difficulty gathering momentum because formal corporate alliances have been slow to jell.

In Mr. Varsavsky’s approach, FON’s business is subsidized by non-Foneros — passing Web surfers who buy time for access to the network — which he can then share with FON’s customers. The approach is different from that of Boingo, a Wi-Fi aggregator based in Los Angeles that charges users a monthly fee for using hotspots while they are traveling.

Yet both FON and Boingo have faced significant resistance from Internet service providers that carefully restrict access to their customers, leaving the idea of a seamless wireless Internet based on Wi-Fi technology an unfulfilled dream so far.

Mr. Varsavsky said he initially hoped that selling $30 Wi-Fi routers embedded with FON software would be all he needed to expand the ranks of Foneros around the globe. But this approach failed to gain traction fast enough, and he shifted gears. Now he is trying to steadily stack up distribution deals with I.S.P.’s.

While some I.S.P.’s have ignored his company, Mr. Varsavsky says FON has gained ground among I.S.P.’s that are looking for a way to attract new customers in competitive markets as well as to compete with high-speed wireless cellular networks.

FON now has a growing range of alliances, including ones with the BT Group, Neuf Cegetel in France, Livedoor (a Japanese I.S.P.), and Time Warner in the United States, as well as a recent agreement with the city of Geneva, which is distributing hundreds of FON routers to residents. Now strongest in Britain, France and Japan, FON has recently made progress with new agreements with two major Japanese retailers and a Taiwanese I.S.P. And Mr. Varsavsky said he is close to major agreements in India and Russia.

FON’s losses have shrunk from more than a million euros a month to less than 500,000, Mr. Varsavsky says. He also hasn’t given up his belief that a coming generation of wireless Internet technology will eventually give FON an even bigger boost.

The first generation of Wi-Fi technology was limited in range, making it impractical for Foneros to share their routers widely. But a new wireless technology, known as 802.16, which should be more widely available to consumers over the next two years, will offer far greater ranges.

This next generation of wireless communication, called WiMax by Intel and others, may allow him to complete his dream — in effect making it possible to weave together a wireless digital network in an urban area with nothing more than an army of Foneros willing to let their routers be used as micro cell towers.

“Why should anyone have to build their own towers?” he asks.

FON’s future, he argues, will revolve around universal access to the wireless Internet. In the meantime, he faces a big obstacle in one of the world’s most lucrative communications markets: the United States, where newer cellular networks with flat-rate pricing may prove a challenge because they will provide universal high-speed coverage.

In Europe, the Internet landscape looks more promising. The European Commission’s decision last summer to place a price cap on voice calls — to make cellphones more affordable for residents traveling within the European Union — didn’t include mobile data. Recent high-speed wireless networks introduced in Europe also use per-megabyte pricing, discouraging the streaming of large files like video.

That leaves a potentially big opportunity for a widely accessible sharing solution for travelers. Yet even in Europe, there are potential roadblocks, not the least of which has been a historically inhospitable atmosphere for entrepreneurial gambits.

“Europe has a larger market than the U.S.A., but it is culturally fragmented and risk-averse,” Mr. Varsavsky says. “But the differences are narrowing, and now there are European venture capitalists and a local entrepreneurial culture.”

Yet he remains undaunted when he discusses his unfinished revolution and FON’s prospects.

“FON,” he said, “is like a telephone company built by the people,” he said.
http://www.nytimes.com/2008/05/25/technology/25web.html





The Dawn of Free Internet Access?
Betsy Schiffman

It's the sort of news that ought to scare the pants off Comcast executives. FCC Chairman Kevin Martin has proposed the commission auction off a portion of the 25 megahertz spectrum with a free provision -- meaning that whoever licenses the spectrum must provide internet access to people for free.

We won't know whether the FCC will proceed with the idea (the commissioners vote on June 12), but the fact that the proposal is even up for consideration must be gratifying to the millions of Comcast and Cox victims who may pay upwards of $40 per month for shoddy broadband access and awful customer service.

A "free" broadband spectrum auction could also help spur internet adoption in the U.S., where there is still a big gaping divide between the broadband haves and have-nots.

"We've been pushing for [free internet access] as a matter of policy for two years," says John Muleta, founder and CEO of M2Z Networks, a company that aims to provide free ad-supported broadband access. "This country is stuck with a low [adoption rate of broadband web access], mainly because it's either not available or it's not affordable in many markets."

Of course, we've heard this song before. Back in 1999, everyone offered free, ad-supported internet access. Yahoo and Kmart teamed up on a free ISP called BlueLight.com; NBC's online arm, NBCi launched one, too; so did many of the major web players of the time, such as AltaVista, Excite and Lycos. Few free ISPs still exist today.

The key difference between then and now, according to Muleta, was that the free ISP of yesteryear was a dial-up service, and its livelihood depended on the terms negotiated with telecom providers.

"The problem was that [the free ISPs] couldn't control their destiny," Muleta says. "The limitation was the deal you could get from the telcos, and the service was supported by banner ads. Now people recognize the value of search-[based advertising.]"

So is Muleta talking to Google, Yahoo or Microsoft about a partnership for the free access?

"We're a Silicon Valley company and we're always talking to potential partners," Muleta says.
http://blog.wired.com/business/2008/...wn-of-fre.html

Among the conditions proposed by Martin would be censorship of speech and content – Jack.





Councilman Plans Demo of Porn Filter
John Woolfolk

San Jose City Councilman Pete Constant on Friday will host a public demonstration of technology he says can effectively filter Internet pornography without impeding legitimate research.

Constant, who has been pushing the city to install filtering technology at public libraries, has invited critics - including the San Jose director of the American Civil Liberties Union - to test the system, which is used in Arizona. The council next month is scheduled to decide whether to reconsider the city's current policy.

Also invited is Library Director Jane Light, who gave a dim assessment of filtering technology in a report to the council earlier this month. She said various systems, including the one Constant advocates, allow objectionable material while blocking legitimate sites.

The public also is invited to test the technology. The demonstration will be from 3 to 5 p.m. Friday in Committee Room 120 at the City Hall wing, 200 E. Santa Clara St.
http://www.siliconvalley.com/news/ci_9412496





Potty-Mouthed Hackers Steal Comcast.net Keys, Go for a Spin

Users redirected to rogue site
Dan Goodin

Unknown hackers hijacked Comcast's domain name for three hours overnight, sending subscribers who tried to access webmail and other services to a rogue site that bragged of the exploit.

Comcast lost control of the comcast.net address after the attackers changed registration information stored by its domain registrar, Network Solutions, a Comcast spokesman said. The unauthorized change redirected people attempting to visit the site to a page that read: "KRYOGENIKS Defiant and EBK RoXed COMCAST. sHouTz To VIRUS Warlock elul21 coll1er seven." The page was displayed after the attackers altered the site's IP resolution information, replacing Comcast's IP address with the rogue address 209.62.20.186.

Comcast spokesman Charlie Douglas said there was no immediate evidence that the attackers' page tried to install malware or steal user credentials. But some participants in this DSLReports forum reported their email clients were redirected to the impostor address, prompting concern their login sequence could have been intercepted. Douglas said security people are still investigating.

Comcast engineers restored the correct domain name settings about three hours after they were altered. By late Thursday morning, comcast.net was accessible to most people. But some users, including some with private DNS servers that hadn't been updated, still got errors. (Windows users who are getting errors may want to try flushing their DNS cache using using the command "ipconfig /flushdns", sans the quotes.)

It's still unclear how the attackers accessed the registration settings on store with Network Solutions. A brute force password attack is one possibility, but you'd think Network Solutions has safeguards in place to detect thousands of unsuccessful login attempts. A Network Solutions spokeswoman said the company is working with Comcast to figure out how the hackers obtained the login credentials to the account.

The ability of unknown hackers to hijack the domain name of one of America's biggest internet providers is yet another reminder of the fragility of the net's domain name system. While DNS attacks in recent years have focused on more esoteric methods such as cache poisoning and DNS rebinding, the attack shows that old-fashioned account compromises are also sufficient to alter substantial amounts of web traffic.

Douglas said Comcast is working with unnamed law enforcement agencies to track down the attackers.

Little is known about the interlopers, except for a few traces left behind that hint at some sophomoric sensibilities. In addition to their cryptic defacement, they altered the address for Comcast's administrative contact to "69 dick tard lane, dildo room."
http://www.theregister.co.uk/2008/05...main_hijacked/





NNSquad

Network Neutrality Squad

NNSquad Network Measurement Agent (NNMA)
Beta 2.0.0.6 Release - 29 May 2008

Installable (Win 2000, XP, Vista) BETA Distribution (Zip / Tar)
Source (LGPL) BETA Distribution (Zip / Tar)


The NNSquad Network Measurement Agent (NNMA) monitors network activity on computer systems, looking for and flagging a variety of potential problems. NNMA also includes a special function that attempts to detect reset (RST) packets that may have been injected into a TCP connection by any entity not located at the connection endpoints (for more on this feature, please see the NNMA methodology notes).

While the reset packet detection system included in this release is of interest, NNSquad views this package as more important in the long run as a development base for a broad range of network measurement functionalities and associated communications and analysis efforts.

The NNSquad Network Measurement Agent (NNMA) Beta 2.0.0.6 is released as open source software under the LGPL, by the Network Neutrality Squad project of People For Internet Responsibility (PFIR). It was developed from the "Buster" network management and security program, which was specifically open-sourced by its authors at Praemio, Inc. in furtherance of the NNSquad project. Additional licensing details are included in both the installable and source distribution archives.

This package is suitable for installation on Windows 2000, XP, and Vista. It should not be installed on earlier versions of Windows.

Please let us know if you're interested in coordinating on ports to other platforms, such as Linux, BSD, and Mac, or embedded hardware (e.g. WRT54G router).

Special thanks to John Bartas for all of his diligent and continuing work on this software for NNSquad.

NNMA is currently experimental, proof-of-concept "beta" software. Bugs and potentially undesirable behavior may be present, and there are cosmetic issues that will be eliminated as development continues. The user accepts all risks from installation and use of this software. Full documentation is not currently available for this beta package. If you're not comfortable working with beta software, please do not install this package.

Please see the release notes (in the README.txt file within both the installable and source distribution archives) for more information.
http://www.nnsquad.org/agent





Ozzie: Open Source a More Disruptive Competitor Than Google
Mary Jo Foley

Google has nothing on open source when it comes to potential competitive threats to Microsoft, according to Redmond’s Chief Software Architect Ray Ozzie.

Ozzie fielded a number of questions on his role at Microsoft and the company’s evolving technology strategies during an appearance at the Sanford Bernstein Strategic Decisions Conference on May 28. (I listened to his session via the Webcast.)

Ozzie reiterated that it often takes a strong competitor to truly galvanize Microsoft.

“Microsoft has built up a culture of crisis,” Ozzie told conference attendees.

Competitors like his former employer, Lotus, and now, Google, have spurred the company to make changes to its business to stay ahead, Ozzie said. But while Google is a “tremendously strong competitor,” Ozzie acknowledged, “open source was much more potentially disruptive” to Microsoft’s business. (He noted that, unlike Google, many open-source programmers aren’t beholden to shareholders.)

Ozzie said that competing with open source “made Microsoft a much stronger company.” He cited changes Microsoft has made to its business model — such as focusing on making its closed-source software interoperable with open-source products — as directly attributable to that competition.

During the rest of his hour-long talk, Ozzie focused on many of his favorite topics, such as the need for a mesh for devices and people (Live Mesh) and the importance of giving customers choice (with Software+Services, rather than a 100% cloud-services approach). A few other tidbits from his remarks that I found interesting:

* The changing nature of the operating system in an increasingly services-based world. Ozzie noted that if a new operating system were designed today, it wouldn’t be a single piece of software that operates a single computer. It would be something that could accommodate multiple devices, with the user at the center. That sounds like Live Mesh — but perhaps he was also hinting about Microsoft’s post-Windows, distributed operating system I keep hearing rumors about…

* Yahoo as an “accelerator.” Ozzie deftly deflected questions about Microsoft’s on-again/off-again deal-making with Yahoo. “Yahoo was not a strategy unto itself,” he said. “It was an accelerator to the ad platform.” Ozzie spoke highly of Yahoo’s work in the social-networking and community space, adding that these kinds of services represented the next wave in communications technology. He also pooh-poohed any notion that Microsoft might be wavering on its commitment to being an online player. “We are very, very serious about the online space,” he said.

* Programming tools that work across a variety of devices. At the very end of his remarks, Ozzie made a passing reference to the need for not just programming tools and services that can accommodate multi-core/many-core systems, but also tools that can work across a variety of devices. He noted that there’s a need for development tools for building software that works across multiple devices. A reference to the Live Mesh Software Development Kit (SDK), expected to debut at Microsoft’s Professional Developers Conference in late October? Perhaps….
http://blogs.zdnet.com/microsoft/?p=1418





The Real Fight Over Fake News
Saul Hansell

“The Daily Show” is a bellwether for the evolution of Internet video. It is also one of those programs that signify for people why they pay so much money for cable.

Until recently, few of the main made-for-cable programs have been available to watch in full over the Internet, even as broadcast networks have started streaming full episodes of most of their shows. The reason is that cable and satellite systems pay large fees to networks for what they have seen as exclusive rights to their content. (Their deals with broadcast networks are less restrictive.)

In recent months, that has started to change as programs such as USA’s “Monk” and “Tyler Perry’s House of Payne” on TBS become available on the Internet. But many other signature cable programs, like ESPN’s “SportsCenter” and CNN’s “Larry King Live” are not regularly Webcast in their entirety.

That’s why my eyebrows jumped when I saw the announcement last week that full episodes of three Comedy Central shows — “The Daily Show,” “The Colbert Report” and “South Park” — will start being Webcast, both on MTV-owned sites and on the Fancast site from Comcast. (Comedy Central, which is owned by Viacom’s MTV Networks unit, has been Webcasting “South Park” episodes for a few months.)

Just last November, Comedy Central told me that it was not putting full episodes on the redesigned site for “The Daily Show” because of its deal with the cable operators. Instead, it created an awkward compromise in which a series of “clips” from the show would play one after another so users could see all the content from the show. But these clips couldn’t be expanded to the full computer screen, and they didn’t include the opening titles that help create the feeling of a television show.

It’s taken me several days of going back and forth with representatives of both MTV Networks and Comcast to figure out what has changed. I can’t say that I’ve entirely succeeded. The deals between cable companies and networks are dark and nuanced documents with many overlapping quid pro quos.

It turns out MTV’s main deals with cable operators these days do give it the right to distribute all of its content online, said Mark Jafar, an MTV spokesman. And indeed it has started Webcasting some of its signature programs like “The Hills” and “SpongeBob SquarePants.” Comedy Central, however, was under a different set of contracts until early this year because Viacom only bought the network in 2003.

The Webcasting trend is not pleasing the large cable operators. Indeed, when Glenn Britt, the chief executive of Time Warner Cable, was asked recently how he feels about the cable networks putting more content online, he said “Guess what? We do mind.”

Webcasting a program the same day it is broadcast, “will erode your other business model,” Mr. Britt said at the Cable Show in New Orleans earlier this month. If this happens, he said, “we have to intervene at some point.”

Alexander Dudley, a Time Warner Cable spokesman, elaborated when I asked him about Viacom’s move to Webcast full episodes of “The Daily Show.”

“They can’t have it both ways,” he said. “If they put content they ask cable companies to pay for online for free, they are making it less valuable and we should be expected to pay less for it.”

When I asked Comcast the same question, a spokeswoman also expressed some concern about making sure that some of the programming it pays for remains exclusive. But Comcast is not as outraged as Time Warner. One reason is that the company’s experience with offering video-on-demand versions of cable programs appears to have increased viewership of its traditional channels. As a result, it is less worried that online streaming might divert paying customers.

Comcast, unlike Time Warner, also has its own Internet streaming service, Fancast, that can profit from the move to Internet viewing. And it is using its relationships with cable networks to get programming for it. MTV said it is looking to syndicate Comedy Central programs to other online sites as well.

MTV, of course, is very much trying to have it both ways. Its core audience is increasingly moving from watching clips on YouTube to watching full episodes on Hulu and the broadcast network Web sites. Yet, as Mr. Jafir made clear in an e-mail to me, the company also needs to defer to the cable companies, known sometimes as MSOs, that provide so much of its revenue today:

We’ve always worked hard, and we continue to work hard, to strike the right balance between protecting and growing the businesses of our MSO partners and being wherever our audiences are consuming entertainment….We’re definitely not in the business of making all our content available for “free” anywhere — monetization and preservation of the value of our content is a strategic priority for all our distribution across platforms.

Can you see Jon Stewart’s eyebrows flying up at that?
http://bits.blogs.nytimes.com/2008/0.../index.html?hp





What's Online

Legitimizing Marijuana
Dan Mitchell

JANE WELLS of CNBC keeps a blog called Funny Business, but her recent reports on California’s medical marijuana industry are about a business that is increasingly being taken seriously. They amount to a short primer on how the business works and how the operators of the state’s estimated 500 dispensaries deal with the high risks and high costs of working in a legal gray area (www.cnbc.com).

Medical marijuana is legal in California, but federal law still bans sales. Amid the uncertainty that this creates — including the occasional raid by federal agents — a full-fledged industry has blossomed, taking in about $2 billion a year and generating $100 million in state sales taxes, CNBC reported.

Setting up a clinic “can cost as much as a hundred grand,” Ms. Wells reports. The equipment, the cuttings from which plants are grown and office space all tend to be expensive. And from there, the costs only grow, mostly in the form of legal fees. Many clinics keep lawyers on retainer.

Nonetheless, “this is the business model of the future,” says JoAnna La Force of Farmacy, an herbal remedy shop in Southern California. Ms. LaForce says her business is close to breaking even (www.medicalmarijuanafarmacy.com).

A slew of ancillary businesses has grown up around medical marijuana. Bill Britt, identified on the Web site as a patient, has found a new career as an expert witness in cases brought against dispensaries and patients, earning $250 to $350 a case.

He gained his expert knowledge by attending Oaksterdam University, a trade school in Oakland, Calif. At Oaksterdam (www.oaksterdamuniversity.com), students learn everything from “The Politics of Cannabis” to botany to business operations.

Getting into the quasi-legitimate marijuana business is a challenge, says Jeff Jones, chancellor of Oaksterdam’s Los Angeles campus. But, he adds, “The investment is well worth it, except for the federal risk.”

A DISTINCTION, OF SORTS As air travel grows increasingly nightmarish even as it gets more expensive, Patrick Smith, writer of Salon’s Ask the Pilot column, has been singing the praises of Southwest Airlines, the (relatively) cut-rate, bare-bones carrier (www.salon.com).

Southwest recently took first place in a survey of airline satisfaction conducted by the University of Michigan.

Mr. Smith’s initial explanation was this: “People don’t expect much. Southwest Airlines is nothing if not unpretentious” and has “mastered the art of get-what-you-pay-for satisfaction.”

His readers, though, thought otherwise. Many wrote to say that, though Southwest dispenses with a lot of perks, it offers a basic level of customer service that bigger airlines often do not.

Mr. Smith acknowledged that Southwest’s comparatively small size gave it an advantage in maintaining a consistent level of service. Nevertheless, it is “the last of a nearly vanished breed: an airline with a true personality, that large numbers of fliers have unwavering fondness for.”

BACK ON DRUGS As a test of airport security, a customs officer planted marijuana in the side pocket of a random suitcase at Narita International Airport in Tokyo, the BBC reports (news.bbc.co.uk).

The test failed when the sniffer dogs were unable to detect the pot. But the officer could not remember which bag he had used.

Using an actual passenger’s suitcase is against regulations, and the airport’s customs service has apologized.

Meanwhile, the marijuana is still out there. “Anyone finding the package has been asked to contact customs officials,” according to the BBC. So far, nobody has spoken up.
http://www.nytimes.com/2008/05/31/te.../31online.html





US Residents in Military Brigs? Govt Says it's War
Matt Apuzzo

If his cell were at Guantanamo Bay, the prisoner would be just one of hundreds of suspected terrorists detained offshore, where the U.S. says the Constitution does not apply.

But Ali Saleh Kahlah al-Marri is a U.S. resident being held in a South Carolina military brig; he is the only enemy combatant held on U.S. soil. That makes his case very different.

Al-Marri's capture six years ago might be the Bush administration's biggest domestic counterterrorism success story. Authorities say he was an al-Qaida sleeper agent living in middle America, researching poisonous gasses and plotting a cyberattack.

To justify holding him, the government claimed a broad interpretation of the president's wartime powers, one that goes beyond warrantless wiretapping or monitoring banking transactions. Government lawyers told federal judges that the president can send the military into any U.S. neighborhood, capture a citizen and hold him in prison without charge, indefinitely.

There is little middle ground between the two sides in al-Marri's case, which is before a federal appeals court in Virginia. The government says the president needs this power to keep the nation safe. Al-Marri's lawyers say that as long as the president can detain anyone he wants, nobody is safe.

___

A Qatari national, al-Marri came to the U.S. with his wife and five children on Sept. 10, 2001 — one day before the terrorist attacks in New York and Washington. He arrived on a student visa seeking a master's degree in computer science from Bradley University, a small private school in Peoria, Ill.

The government says he had other plans.

According to court documents citing multiple intelligence sources, al-Marri spent months in al-Qaida training camps during the late 1990s and was schooled in the science of poisons. The summer before al-Marri left for the United States, he allegedly met with Osama bin Laden and Sept. 11 mastermind Khalid Sheikh Mohammed. The two al-Qaida leaders decided al-Marri would make a perfect sleeper agent and rushed him into the U.S. before Sept. 11, the government says.

A computer specialist, al-Marri was ordered to wreak havoc on the U.S. banking system and serve as a liaison for other al-Qaida operatives entering this country, according to a court document filed by Jeffrey Rapp, a senior member of the Defense Intelligence Agency.

According to Rapp, al-Marri received up to $13,000 for his trip, plus money to buy a laptop, courtesy of Mustafa Ahmad al-Hawsawi, who is suspected of helping finance the Sept. 11 attacks.

A week after the attacks, Congress unanimously passed the Authorization for Use of Military Force. It gave President Bush the power to "use all necessary and appropriate force" against anyone involved in planning, aiding or carrying out the attacks.

The FBI interviewed al-Marri that October and arrested him in December as part of the Sept. 11 investigation. He rarely had been attending classes and was failing in school, the government said.

When investigators looked through his computer files, they found information on industrial chemical suppliers, sermons by bin Laden, how-to guides for making hydrogen cyanide and information about chemicals labeled "immediately dangerous to life or health," according to Rapp's court filing. Phone calls and e-mails linked al-Marri to senior al-Qaida leaders.

In early 2003, he was indicted on charges of credit card fraud and lying to the FBI. Like anyone else in the country, he had constitutional rights. He could question government witnesses, refuse to testify and retain a lawyer.

On June 23, 2003, Bush declared al-Marri an enemy combatant, which stripped him of those rights. Bush wrote that al-Marri possessed intelligence vital to protect national security. In his jail cell in Peoria, however, he could refuse to speak with investigators.

A military brig allowed more options. Free from the constraints of civilian law, the military could interrogate al-Marri without a lawyer, detain him without charge and hold him indefinitely. Courts have agreed the president has wide latitude to imprison people captured overseas or caught fighting against the U.S. That is what the prison at Guantanamo Bay in Cuba is for.

But al-Marri was not in Guantanamo Bay.

"The president is not a king and cannot lock people up forever in the United States based on his say-so," said Jonathan Hafetz, a lawyer who represents al-Marri and other detainees. "Today it's Mr. al-Marri. Tomorrow it could be you, a member of your family, someone you know. Once you allow the president to lock people up for years or even life without trial, there's no going back."

Glenn Sulmasy, a national security fellow at Harvard, said the issue comes down to whether the nation is at war. Soldiers would not need warrants to launch a strike against invading troops. So would they need a warrant to raid an al-Qaida safe house in a U.S. suburb?

Sulmasy says no. That's how Congress wrote the bill and "if they feel concerned about civil liberties, they can tighten up the language," he said.

That would require the politically risky move of pushing legislation to make it harder for the president to detain suspected terrorists inside the U.S.

Al-Marri is not the first prisoner who did not fit neatly into the definition of enemy combatant.

Two U.S. citizens, Yaser Esam Hamdi and Jose Padilla, were held at the same brig as al-Marri. But there are differences. Hamdi was captured on an Afghanistan battlefield. Padilla, too, fought alongside the Taliban before his capture in the United States.
By comparison, al-Marri had not been on the battlefield. He was lawfully living in the United States. That raises new questions.

Did Congress really intend to give the president the authority to lock up suspected terrorists overseas but not those living here?

If another Sept. 11-like plot was discovered, could the military imprison the would-be hijackers before they stepped onto the planes?

Is a foreign battlefield really necessary in a conflict that turned downtown Manhattan into ground zero?

Also, if enemy combatants can be detained in the U.S., how long can they be held without charge? Without lawyers? Without access to the outside world? Forever?

These questions play to two of the biggest fears that have dominated public policy debate since Sept. 11: the fear of another terrorist attack and the fear the government will use that threat to crack down on civil liberties.

"If he is taken to a civilian court in the United States and it's been proved he is guilty and it's been proved there's evidence to show that he's guilty, you know, he deserves what he gets," his brother, Mohammed al-Marri, said in a telephone interview Friday from his home in Saudi Arabia. "But he's just been taken there with no court, no nothing. That's shame on the United States."

Courts have gone back and forth on al-Marri's case as it worked its way through the system. The last decision, a 2-1 ruling by a 4th U.S. Circuit Court of Appeals panel, found that the president had crossed the line and al-Marri must be returned to the civilian court system. Anything else would "alter the constitutional foundations of our Republic," the judges said.

The full appeals court is reviewing that decision and a ruling is expected soon. During arguments last year, government lawyers said the courts should give great deference to the president when the nation is at war.

"What you assert is the power of the military to seize a person in the United States, including an American citizen, on suspicion of being an enemy combatant?" Judge William B. Traxler asked.

"Yes, your honor," Justice Department lawyer Gregory Garre replied.

The court seemed torn.

One judge questioned why there was such anxiety over the policy. After all, there have been no mass roundups of citizens and no indications the White House is coming for innocent Americans next.

Another judge said the question is not whether the president was generous in his use of power; it is whether the power is constitutional.

Whatever the decision, the case seems destined for the Supreme Court. In the meantime, the first military trials are set to begin soon against detainees at Guantanamo Bay. Al-Marri may get one, too. Or he may get put back into the civilian court system. For now, he waits.
http://news.yahoo.com/s/ap/20080524/...9U4FhHg6Ss0NUE





Studios Reach Deal With TV Actors
Michael Cieply

Hollywood took another step toward labor peace Wednesday morning, as a union representing television actors reached a tentative three-year deal with production companies after talks had become stuck over the re-use of performers’ images on the Internet.

The agreement between the American Federation of Television and Radio Artists and the producers builds pressure on another, bigger actors union, the Screen Actors Guild, to craft a similar solution. SAG’s talks over a new contract with the Alliance of Motion Picture and Television Producers — which is set to expire at the end of June — stalled earlier this month, but were set to resume later on Wednesday. The most difficult issue in the talks with Aftra surprisingly did not hinge on compensation of artists for work in new media, as during the recent three-month writers’ strike. Instead, it had to do with the granting of permission. Actors have traditionally had the right to approve the use of clips from their work on television. But producers had asked for the ability to use clips on the Web without permission from each actor, arguing that flexibility was needed to counter the widespread piracy of shows on the Internet.

“We did not see it coming. It was a huge issue to tackle,” Roberta Reardon, president of the federation, said of the demand for use of the clips. Ms. Reardon said the union had agreed that within 90 days of the contract’s final approval to work out a system under which performers might give advance or blanket permissions covering an entire series, for which the actors will be compensated.

The federation’s contract covers performers on nearly a dozen series, including ABC’s “Cashmere Mafia” and HBO’s “Curb Your Enthusiasm.”

The settlement followed three weeks of talks, and back-to-back sessions that ran through the holiday weekend, and continued until the early hours on Wednesday. The federation’s national board is expected to review the tentative agreement next week, and, if it approves terms, to submit the deal to a vote of the membership of approximately 70,000.

In the last half-year, Hollywood’s movie and television producers weathered a three-month strike by writers, and ultimately set new contracts with unions representing writers, directors and, now, some of its television actors.

In each case, negotiators have fought over difficult questions related to new media. According to Ms. Reardon, her union’s tentative deal closely followed those struck earlier by writers and directors. It established union jurisdiction over new media compensation and set pay schedules for digital media. An earlier round of talks between producers and the Screen Actors Guild, which represents about 120,000 actors, ran aground over a number of issues, which included the companies’ demand for freedom to use clips.

In a statement on its Web site, the producers alliance called the Aftra deal “an agreement that makes the new media framework work for all actors.”

Hollywood has been bracing for the possibility of another strike, should no agreement be reached with the actors guild by June 30, when its contract expires. Companies have been rushing to wrap their movie productions before that deadline, and little work has been scheduled for the weeks beyond, promising what some have called a de facto strike — a period with little production because of uncertainty over labor talks.

Members of the Writers Guild of America East and the Writers Guild of America West on Nov. 5 began a walk-out that went on for 100 days before they reached a new deal with producers. Like Aftra, the Directors Guild of America reached terms without striking.

Last month, the International Alliance of Theatrical Stage Employees, which represents about 25,000 movie and television workers on the West Coast, recessed talks toward a new contract to take effect when its current deal expires in August of 2009. Representatives of the craft unions said they planned to defer their negotiations while the actors came to terms with the companies.
http://www.nytimes.com/2008/05/29/bu.../29studio.html





Netflix Sees DVD-By-Mail Peak in as Soon as 5 Years

Reed Hastings, chief executive of Netflix Inc, said he expects the company to have 10 million subscribers by next year, but the DVD-by-mail business will peak in as soon as five years.

"We think the by-mail business is very strong but will probably peak in the next five years," said Hastings at the Netflix Investor Day in San Francisco on Wednesday. A slide at the presentation showed the peak in five to 10 years.

"Our key challenge is growing earnings per share and subscribers while funding streaming (online video) which should give us years of subscriber and earnings expansion," he told analysts.

Hastings told investors that the company's online investment in 2008 and 2009 is expected to be "fairly inefficient," but noted the reason for higher spending was to cultivate better partnerships and content.

He cited as risks the growing popularity of stand-alone DVD rental kiosks, improving video-on-demand services from cable and satellite companies and more competition in streaming from Web giants like Amazon.com Inc and Apple Inc and the potential of renewed promotional spending by Blockbuster Inc in the by-mail sector.

But Hastings and other company executives were bullish on the company's long-term position given its successful expansion into the streaming DVD market.

"Once we're in streaming ... we can attract well beyond 20 million subscribers worldwide," he said.

(Reporting by Sue Zeidler, editing by Jeffrey Benkoe, Phil Berlowitz)
http://www.reuters.com/article/filmN...43042120080529





20 Seconds, and a Movie Has Arrived
David Pogue

Last year, the movie industry raked in more than $40 billion.

What are they doing wrong?

Well, for one thing, most people can’t consume the product — movies — without getting in the car and driving somewhere, to a theater or video store.

Imagine, though, if you could watch any movie, any time, without budging from your sofa, by downloading it. All kinds of companies have been tripping over each other to deliver this movie paradise, including Amazon.com, TiVo, Movielink, Apple, Vudu, Netflix, CinemaNow, Vongo and MovieFlix.

Unfortunately, each service is fatally flawed.

Internet download services offer instant gratification, but most require you to watch on your computer screen, which is nobody’s idea of normal. Set-top boxes like TiVo, Apple TV and Vudu deliver movies to your TV, but erase your rented movies after only 24 hours. DVD-by-mail services like Netflix offer terrific selection, but it takes at least a day to receive the movies.

This week, Roku and Netflix unveiled a little $100 box that aims to eliminate all of those drawbacks. Delivery to your TV, not your computer? Check. Instant delivery from the Net? Check. Eliminate the 24-hour viewing window? Check.

Oh, yeah — and all the movies are free.

To understand what makes the Netflix Player a flawed masterpiece, it helps to understand its history. (This will take six paragraphs, which you can skip if you want just the punch line.)

Netflix is the largest DVD-by-mail service, with 8.2 million members and about 100,000 movies. Its Web site offers terrific tools for finding, recommending and organizing movies that you want to see. The glaring downside is having to wait for the next DVD to come in the mail. (Yes, Western civilization has come to this: complaining that it takes a whole day to get a movie.)

Early last year, Netflix tried to address that problem with Instant Watching, a service that lets you watch streaming Netflix movies in your Web browser. The movie wait was reduced from one day to 20 seconds.

The best part: there’s no extra charge for this. It’s free with regular Netflix DVD-by-mail membership (for example, $14 a month to check out two DVDs at a time). You can watch movies all day long, if you like.

Instant Watching introduced a new verb: movie surfing. Watch 10 minutes of a movie and then decide it’s not for you? No problem. Switch to a different movie.

The only wrinkle: You’re watching on your PC. Only the weird watch “Lord of the Rings” sitting in a desk chair.

“O.K.,” said Netflix. “You want Instant Watching on your TV? We can do that.” And it came up with the Netflix Player, manufactured and sold by Roku (Roku.com).

This thing could not be simpler. I was watching my first movie six minutes after opening the box.

Like all Internet movie services, the Netflix Player requires a high-speed Internet connection. It found and connected to my wireless network instantly and flawlessly. (You can connect it to your home network with a cable if you prefer.)

It connects to your TV using any kind of modern video connection: HDMI cable, component cables, S-Video or even those old red-white-yellow RCA cables. The nine-button remote lets you choose a movie, skip around in it or pause.

Usually, fast-forwarding or rewinding an Internet streaming movie is a hellish game of guess and wait. You can jump to a new spot on the movie’s scroll bar, but you have no idea where you’ll land; you don’t see a sped-up picture, as you do when fast-forwarding a DVD. Only when you release the mouse and wait 15 or 30 seconds for the movie to “rebuffer” do you see where you wound up.

On the Roku box, little thumbnail images of the movie scenes flash by, one for every 10 seconds of movie. When you stop scanning, you still have to wait 15 or 30 seconds — but at least you’ll know you landed at roughly the right scene in the movie.

You’re supposed to line up movies for this box at Netflix.com, where a new, second movie queue awaits. Any changes you make here appear on the box in seconds. On the TV, your wish list appears as a parade of colorful DVD cases on a scrolling shelf.

Having to scurry over to your computer can be a drag, but it does afford three benefits. First, it keeps the player’s on-screen menus extremely simple. Second, it lets you use all of those great Netflix.com tools to find and pick your flicks. Third, it lets Mac fans enjoy Instant Watching (since so far, watching on your computer requires Windows).

The video quality depends on the speed of your Internet connection. The clarity over slower hookups, like DSL, will disappoint you. If you have a fast cable modem (technically, 2.2 megabits a second or better), you get what Netflix calls near-DVD quality. I call it TV quality.

The ever-growing Instant Watching catalog now offers 10,000 movies and recent TV episodes. Unfortunately, as on most Internet movie services, the majority of it is the dregs, with titles like “Tan Lines,” “Dead and Breakfast” and “National Parks of the West.”

Netflix lets you sort movies by rating, year, genre, whatever—but it really needs to let you sort by “likelihood you’ve ever heard of this movie or anyone associated with it.”

Fortunately, there are still plenty of recognizable titles buried in the junk: “Unforgiven,” “Air Force One,” “Amadeus,” “Driving Miss Daisy,” “The Killing Fields,” “Philadelphia” “The Shining,” “Men in Black,” “Blade Runner,” “Five Easy Pieces,” “Cool Hand Luke,” “A Clockwork Orange,” “March of the Penguins” and so on.

But what do they all have in common? They’re old.

Netflix Instant Watching is at the bottom of the release pecking order. It gets movies after they have finished their runs in the hotel, airline, DVD and pay-per-view “windows.” It gets them when movie channels like HBO and Starz get them, and sometimes even later.

Netflix makes little apology for the age. It views its DVD-by-mail and Instant Watching features as two parts of one service. When movie freshness matters, get them on DVD; when delivery speed matters, use Instant Watching. As long as Hollywood’s lawyers run the show, you’ll never be able to have both.

In the game of Internet movies, the Netflix Player is revolutionary. It’s the first Internet service that delivers movies to your TV without a per-movie fee — an incredibly strange, liberating feeling. It’s also the first that doesn’t require you to download or store your movie collection.

Finally, it’s the first without a 24-hour time limit. If you feel like watching a movie again, you can watch it next week or next year, without paying a penny more.

Roku also says that this box is wired for the future. When Instant Watching goes to high definition, the Player will be ready. Roku also says mysteriously that its deal with Netflix is not exclusive; technically, the box is equipped for future rivals.

Is the Netflix Player, then, the movie box the world is waiting for? Not quite. It falls short on the age of its movies, the smallish selection of good ones and the not-quite-pristine video quality. And as with all Internet movies, you don’t get subtitles, director commentaries or any other DVD extras.

But it comes darned close. For movie lovers who already subscribe to Netflix, at least, this one-time $100 expenditure is practically a no-brainer.
http://www.nytimes.com/2008/05/22/te...h/22pogue.html





Amazon to Launch Streaming Video

Amazon.com Inc (AMZN.O), the largest Internet retailer, will launch a streaming video service in the next few weeks to augment its digital offerings, the company's chief executive said on Wednesday.

Jeff Bezos, speaking at The Wall Street Journal's three-day D: All Things Digital conference taking place north of San Diego, did not elaborate, and a company spokeswoman would not provide more information.

The Seattle-based company has been beefing up its digital media offerings in order to better compete with rivals such as Apple Inc (AAPL.O), which dominates the category with the popular iTunes music download service.

Besides recently launching an electronic book reader, the Kindle, Amazon has been building a digital music store and now offers downloadable movies, television shows and videos on its Web site.

It also has a deal with TiVo Inc (TIVO.O), maker of the popular digital video recorder, that allows users to rent videos from Amazon's Unbox service and watch them on their televisions.

Amazon is not alone in looking at streaming online video, allowing viewers to essentially rent movies via the Web rather than download large files to store on personal computers or other devices.

On Wednesday, the chief executive of DVD-by-mail company Netflix Inc (NFLX.O, Reed Hastings, said the company is currently funding streaming video in order to "give us years of subscriber and earnings expansion." Hastings spoke at the company's investor day in San Francisco.

"Once we're in streaming ... we can attract well beyond 20 million subscribers worldwide," Hastings said.

(Additional reporting by Susan Zeidler in San Francisco)

(Reporting by Alexandria Sage, editing by Gerald E. McCormick)
http://www.reuters.com/article/inter...32602720080528





Entering Virtual Worlds for Real-Life Pitches
Eric Pfanner

IN 2002, when Electronic Arts signed a multimillion-dollar agreement with McDonald’s to place virtual burgers in an online version of its popular Sims video game, the move drew protests from players who resented the commercial intrusion.

But the Sims, a virtual family designed by players, are only becoming more brand-conscious. Starting in June, people who play The Sims 2, the current version of the game, will be able to buy a “stuff pack” (on a disc or online) that lets them decorate their simulated families’ homes with Ikea furniture. Last year a similar deal was made with H&M, the Swedish clothing retailer, that lets players buy a disc full of H&M-branded clothing for their Sims avatars.

While most other “stuff packs” contain generic accouterments — one called “Glamour Life,” for instance, lets players pick from label-free furnishings and evening gowns — the Ikea pack will let players move items like the Ektorp sofa and the Leksvik coffee table into their families’ virtual homes.

Electronic Arts, the world’s largest video game company, said it made the deal with Ikea, the Swedish furniture manufacturer, in response to requests in online players’ forums for more modern, realistic furniture.

“Because we have such a direct relationship with our players, the players help shape the product strategy,” said Nancy Smith, president of the Sims label, which has sold more than 100 million copies.

The deal is yet another example of how the traditional lines between paid-for content and marketing material are blurring in the media world. Companies that sell products and services are increasingly eager to place their wares inside television shows and other media rather than relying on stand-alone commercials. Media companies like Electronic Arts, meanwhile, are looking to sponsorship deals to help recoup the growing cost of developing games.

•

For marketers, the huge fan bases for some video games are a potentially rich target audience. In one recent blockbuster release, Grand Theft Auto IV sold more than six million copies in its first week. The Grand Theft Auto series is published by Take-Two Interactive, which Electronic Arts has been trying to buy, though it has persistently been rebuffed.

In addition to sponsorship agreements like the Ikea-Sims deal, game companies have been trying to sell advertising space and time in games, often on billboards or other elements of the virtual backdrop. In games played online, ad space can be sold across networks of games for specific time periods, as it is on television.

But analysts say that advertisers have been skittish about such ads, in part because of their limited reach. Some networks, for instance, work only with games played on a single system like Microsoft’s Xbox or Sony’s PlayStation.

Other advertisers may worry about placing their brands in controversial material. The Grand Theft Auto franchise is notorious for its violent and sexually laced content, and the latest title contains only spoof ads, for products like the “new iFruit phone,” which resembles Apple’s iPhone but is promoted with this pitch: “No buttons. No reception. No storage capacity. All ego.”

Michael Goodman, an analyst at the Yankee Group, said that last year, marketers spent about $180 million on in-game advertising, including sponsorships like Ikea’s deal. He has predicted that spending would rise to $332 million this year, but said he was considering lowering that forecast slightly, as growth seems to be slower than expected.

•

For marketers seeking a safe environment for their brands, tie-ins seem to offer a measure of control. Also, by putting the name of the sponsor brand on the game’s packaging, they go beyond simple product placement deals like Electronic Arts’ arrangement with McDonald’s (a similar deal with Ford Motor allows people who play Sims online to download virtual cars at no charge).

“Ikea sees this as a new channel to reach the young and the young at heart,” an Ikea spokeswoman, Charlotte Lindgren, said in an e-mail message.

The “stuff packs” will cost about $20.

The Ikea partnership with Electronic Arts is similar to the deal with H&M, though that promotion also allowed players to take part in a fashion show. A winning design will be sold in actual H&M stores this summer.

Steve Seabolt, vice president for global brand development for The Sims, said Electronic Arts was pursuing similar arrangements with other companies. He declined to say which one might be next, but named as potential partners consumer electronics companies, like Philips, Electrolux and Sony, as well as brands like Starbucks, Dunkin’ Donuts, Pepsi, Coca-Cola and Borders books.

The Sims 3 is set to be released next year, with new features like a town center that has plenty of virtual storefronts (read: opportunities for advertising).

Electronic Arts and Ikea declined to provide financial details of their agreement. Mr. Goodman, the Yankee Group analyst, said that while advertisers typically pay for space upfront, in this case the two companies might have agreed to share revenue from sales of the software discs.

Mr. Seabolt of Electronic Arts said his company was willing to be flexible for marketers considering The Sims. “This is anything but a one-size-fits-all proposition,” he said. “We make a huge effort to sit down with clients and really understand their marketing objectives.”
http://www.nytimes.com/2008/05/29/bu...ia/29adco.html





Seagate Plans SSD, 2TB Hard Drive for Next Year

Selling hard drives will remain Seagate's focus for now
Agam Shah

Seagate will introduce its first solid-state drive (SSD) storage and 2TB hard drive next year, said company CEO Bill Watkins.

The company's first SSD product will be targeted at enterprises that need speedy storage and can afford to pay a premium for the expensive drives. Seagate has no plans to release SSD drives for consumers, as the high prices could deter them for the next few years, Watkins said in an interview.

The release date and price information for the 2TB hard drive were not available. Seagate released 1TB hard drives, the Barracuda 7200.11 and Barracuda ES.2, in the middle of 2007.

While there is no competition now between hard drives and SSDs, Seagate is thinking of going to SSDs in the long term to replace hard drives.

"SSDs are not price-competitive yet," Watkins said. The storage market is driven by cost per gigabyte, and though SSDs provide benefits such as power savings, they won't be in laptops in the next few years, Watkins said. Low-power consumption capabilities and high speeds make SSDs useful for laptops, but the cost per gigabyte won't come down at least for the next few years, Watkins said.

"If the cost per gigabyte comes down to 10 cents, maybe," Seagate will focus on SSD storage for consumers, Watkins said.

A 128GB SSD costs $460, or $3.58 per gigabyte, compared with $60 for a 160GB hard drive, said Krishna Chander, a senior analyst at iSuppli.

"It will take three to four years for SSDs to come to parity with hard drives" on price and reliability, Chander said.

Besides price, other issues will keep SSDs from the consumer space, Watkins said.

Users seek fat storage to carry data, and hard drives can store terabytes of data, something SSDs can't do, Watkins said. SSDs also have write issues, with cells in the drives deteriorating quickly and reducing storage capacity, a general problem that plagues flash drives.

Even enterprise adoption of SSDs could be slow, Watkins said. "People are still trying to get tape out of the enterprise," he said.

Seagate's SSD would be mainly for data centers that rely on processing data quickly, like indexing servers or search servers, that can temporarily store data until it is ultimately moved to permanent storage on hard drives or tape. Solid-state drives can move data up to 10 times quicker than hard drives, but data has to ultimately be moved to larger and more reliable storage, Watkins said.

The SSD drive could also be useful for data centers looking to save on energy consumption and costs.

Seagate is taking a wait-and-see approach to SSDs, similar to the company's approach to optical storage. Seagate acquired optical-storage company Quinta in 1997 when everyone thought optical storage would replace hard drives, Watkins said. Seagate wasn't sure how far rotating media technology would stretch, but the cost per gigabyte fell and hard drives overtook optical drive technology.

Selling hard drives will remain Seagate's focus for now, but it will make sure the SSD component is available to customers, Watkins said. The company is internally researching and developing SSD storage.

The company already offers hybrid drives like the Momentus that combine NAND flash storage with hard drives to reduce power consumption and improve boot times.

Seagate has been making noise in the SSD market for a year now, but it has been mostly vaporware, iSuppli's Chander said. Seagate needs to get a leg up on its competition by getting into the game early and packaging SSDs in volume.

"They haven't stretched out. They are losing an opportunity. The reality is no matter what, in the next three to five years, SSDs are going to come out," Chander said.

Entering the SSD market early could give Seagate an advantage over its major competitor, Western Digital, which is too deeply lost in the hard drive market to make its presence felt in the SSD market, Chander said.
http://www.computerworld.com/action/...&intsrc=kc_top





Encryption Chip Will End Piracy, Open Markets, Says Bushnell

Speaking at yesterday's Wedbush Morgan Securities annual Management Access Conference, the Atari founder suggested that game piracy will soon be a thing of the past thanks to a new chip.

"There is a stealth encryption chip called a TPM that is going on the motherboards of most of the computers that are coming out now," he pointed out

"What that says is that in the games business we will be able to encrypt with an absolutely verifiable private key in the encryption world - which is uncrackable by people on the internet and by giving away passwords - which will allow for a huge market to develop in some of the areas where piracy has been a real problem."

Bushnell thinks that piracy of movies and music, however, is probably unstoppable because "if you can watch it and you can hear it, you can copy it."

"Games are a different thing, because games are so integrated with the code. The TPM will, in fact, absolutely stop piracy of gameplay.

"As soon as the installed base of the TPM hardware chip gets large enough, we will start to see revenues coming from Asia and India at a time when before it didn't make sense."
http://www.gamesindustry.biz/article...-says-bushnell





Finnish Appeals Court Rules Breaking CSS Illegal
Thomas Nybergh

Due to an appeal court decision from a couple of days back, breaking the not very effective CSS copy protection used on most commercial DVD-Video discs is now a criminal act in Finland. The verdict is contrary to what a district court thought of the same case last year when two local electronic rights activists were declared not guilty after having framed themselves by spreading information on how to break CSS . Back then it was to the activists' benefit has CSS been badly broken and inneffective ever since DeCSS came out.
http://yro.slashdot.org/article.pl?sid=08/05/26/1357257