Peer-To-Peer News - The Week In Review - March 11th, ’06

[JackSpratts]

"Back doors are simply not acceptable. Besides, they wouldn't find anybody on this team willing to implement and test the back door." – Niels Ferguson


"It's not like having a policeman inside your computer, it's like having a mafioso inside your computer, playing by whatever rules he decides." – Nelson Pavlosky


"One would have thought they'd make awfully sure that a DRM measure didn't threaten critical infrastructure or endanger lives before they deployed that measure. But apparently they want to keep open the option of deploying DRM even when there are severe doubts about whether it threatens critical infrastructure and potentially endangers lives." – Ed Felton


"We were willing to go out and replace all our computers with Macs just to be happy with the iPod. Really and truly, it's like a child to me." – Aliza Loewy


"I open up my network, leave it wide open for anyone to jump on. I'm sticking it to the man." – Elaine Ball


"On a family vacation this summer we needed to get access. I said, 'O.K., let's drive around the beach with the window open.' We found a signal, and the owner of the network was none the wiser. It took about five minutes." – Mike Wolf


"I'm a grandmother. They're not going to yell at an old lady. I'll just play the dumb card." – Beth Freeman


"So far this year, album sales have declined about 3 percent from a year ago. But if every 10 [digital] singles sold so far were bundled together and counted as albums, sales would be up about 2 percent." – Jeff Leeds


"All respondents were relaxed about their personal habits when working remotely. While about 39% of respondents of both sexes said they wear sweats while working from home, 12% of males and 7% of females wear nothing at all." – SonicWALL Survey


"Popping the collar that is huge. It's like life at New Milford High School. If you don't have your collar popped, you are not cool." – Amy Donahue


"You don't have to know many things to do a botnet like this." – Witlog





































March 11th, ’06






Copy Cats

Local Students Lead The Fight Against Efforts To Limit File Sharing
Daniel McQuade

"If you can't rip it, you got ripped off!"

A tall black-haired kid thrusts fliers into the hands of people passing by Tower Records on South Street.

He's being loud. But he's not advertising any promotion at Tower. In fact, Tower employees emerge from the store shortly after he starts handing out fliers, asking him to move away from the door and threatening to call the cops if he doesn't.

He moves. The other group members look kind of embarrassed. "Sometimes Bill gets a little too into it," laughs Luke Smith, a Swarthmore senior and one of the co- founders of the group organizing last Saturday's protest.

The group is called Free Culture, named for Stanford law professor Lawrence Lessig's book of the same name. The national chapter of the group was launched in April 2004 by then-Swarthmore sophomores Smith and Nelson Pavlosky.

The two filed a lawsuit against voting machine giant Diebold, which had been issuing cease-and-desist orders to anyone hosting embarrassing leaked internal emails. The pair argued that posting the leaked Diebold emails-which exposed flaws in, among other things, Florida voting machines in the contested 2000 presidential race-was simply fair use.

Then a surprising thing happened. Diebold decided to stop fighting the distribution of their internal memos. Smith and Pavlosky had won.

A movement was born.

What began as a two-person movement at Swarthmore has spread to more than 30 campuses across the world. There are now chapters at Bryn Mawr and Penn and at schools in places as far away as Peru and South Africa.

"We're really concerned about cultural participation," Pavlosky says. "We think people should be free to build upon the past and build upon the world around them to make art to engage in discussion over issues."

Free Culture focuses on myriad related issues. Among the group's main concerns are reforming copyright law, protecting technical innovation and freedom of information, and encouraging the adoption of open-source software-i.e., software (like Mozilla Firefox) for which source code can be downloaded and that's created collaboratively by volunteers.

Members came to the group for different reasons. When they sued Diebold, Smith and Pavlosky hadn't even voted in a presidential election and were hardly looking to make names for themselves as voting-machine activists. (They became interested in the debate through the tech geek website Slashdot and open-source operating system Linux, respectively.)

Rebekah Baglini, a Bryn Mawr junior who heads up that campus' chapter, became interested in the group because of her work with scholarly journals as a linguistics major.

"I'm probably going to be in academia for quite a while," she says. "And I want to make sure that important scholarly work can be available to anyone who wants it."

Saturday's protest focused on educating consumers about digital rights management (DRM), which is one way companies protect digital media. It's come into widespread use only in the past few years.

With DRM-which is included on some new CDs and on mp3s purchased from online music stores-a consumer might not be able to play a CD on a computer, copy a CD, rip tracks to mp3 or play an mp3 on a computer not authorized by the company that originally sold the song, for example. (The most popular online music store, Apple's iTunes, allows a user to authorize up to five computers to play music purchased online.)

The anti-DRM movement, spearheaded by groups like Free Culture and by blogger Cory Doctorow's posts on the blog BoingBoing, hit critical mass late last year, when CDs released by Sony installed a secret program similar to those used by hackers on people's computers. Uninstalling the program, called a rootkit, would break a user's Windows system.

"It's not like having a policeman inside your computer," Pavlosky says. "It's like having a mafioso inside your computer, playing by whatever rules he decides."

Saturday's South Street protest went on for about two hours-until the group ran out of fliers. While members of some of the Free Culture chapters will soon be graduating-Smith and Pavlosky finish up at Swarthmore this spring-they all vow to keep up the activism.

"DRM may not seem so dire on the surface, but it's part of a dehumanizing trend in our society," Pavlosky says. "Companies seem to want to limit new creative works. That's a troublesome trend."
http://www.philadelphiaweekly.com/view.php?id=11669





Fight for your right…to party

Yes, the MPAA Is Suing Us

As Reported Everywhere, MPAA issued a press release that thay are now suing isoHunt.com, TorrentBox.com, and a number of other BitTorrent, eDonkey and Newsgroup indexing sites. I still have yet to receive a formal cease and desist letter directly from MPAA Legal, but all seems to indicate this is for real and it's only a matter of time.

This is somewhat a followup to the series of MPAA letters we've received a year ago.

At this point, it is still uncertain what they are actually suing us for, considering we have a thorough copyright policy outlining our stance and takedown procedures. It is sad that despite our best efforts in cooperating with copyright owners, in both disabling copyright infringing links to their works everyday while for others, helping them distribute their works globally and cheaply using P2P technologies, it is still not enough for the MPAA. Have they ever learned from the VCR or Napster? When will corporations stop fighting technology and learn to embrace it to benefit all of us?

To this end, us, isoHunt.com and TorrentBox.com, are forming a coalition together with other P2P operators being sued and yet to be sued, and if possible with the help of the EFF, we will fight for the right for technological progress and the legality of the search engine itself. It is too early right now to say what we need for help from you, but if the MPAA will not back down, I'm sure we are going to need your help. And no, we will not go the way of LokiTorrent or Suprnova.

Anyways, nobody panic, and let the torrents flow. If you like to talk to us live and chat with other fellows in the community, come chat on IRC on #isoHunt on P2P-IRC (SSL enabled on port 7000, you need a client like mIRC ). We'll update as we learn more.


UPDATE 26/02: Of all the P2P sites being sued I am in contact with, none of us have received anything directly from MPAA yet regarding their pending lawsuits. And so far we are not aware of any US court cases that has actually been filed yet against us.

UPDATE 28/02: It's official now, lawsuits have been filed against us and all the sites as mentioned in MPAA's press release. I have to say I am impressed by the depth of their legal research, evidently their lawyers have been watching us for at least a year, since we exchanged letters last year. However, their core accusation is false. We do NOT operate this search engine and other P2P services for the express object of infringing MPAA's copyrights, there are many other torrents of content we index that are not owned by the MPAA, copyrighted or non-copyrighted. We would comply with DMCA takedown requests, given sufficient identification. Which they did not.

We are looking for legal representation and working with the EFF. We will fight this, but we need your help. First, we need money. Estimated legal fees will be at least $20,000 per month. I will be opening a legal defense fund, you will see it on the frontpage here when it's up. Other than your financial support, which you have our best thanks, we also need media attention. Give us as much buzz as possible, or we will get buried in MPAA's "burn the pirates" campaign. We need to get our side of the story out, that we are willing to work with the MPAA and turn P2P into the new VCR. I have asked in a poll in the past, on how much is a TV episode download worth? Most of your responses varied between $0, with commercial, to $2. And I'm already working with a TV show producer who sees the potential of this. Why can't the MPAA?

So, if you know any news reporter, be it local or national, online or on dead paper, we are happy to talk! Please send all media inquiries to <media a-t isohunt.com>.
http://isohunt.com/forum/viewtopic.php?t=38933





There’s a riot going on

uTorrent Sign Six Month PeerFactor Agreement
Michael Ingram

According to a statement by PeerFactor, the lead eveloper of µTorrent, Ludvig Strigeus, has agreed to help develop “new content distribution applications on the Web”.

The developer has signed a contract with PeerFactor for an initial six month evaluation period.

Since the public release of uTorrent in September, the client has risen to the number one spot on Slyck’s list of BitTorrent clients for Windows, as voted by users. This is mostly due to the tiny memory usage, which is around 6MB, compared to second most popular, Azureus, which is typically over 70MB. Yet uTorrent remains feature- rich.

By developing the PeerFactor software, which uses the BitTorrent protocol, Strigeus will be entitled to a share of any advertising revenue generated by the final product.

This move into the authorised distribution market is a step away from anti-P2P technology for PeerFactor, which was a subsidiary of French anti-piracy group RetSpan. The two companies became independent companies six months ago.

PeerFactor shot to notoriety in April 2004 by giving financial rewards to file sharers for spreading fake files and directing downloaders to authorised download sites.

News that µTorrent are selling their software will fuel speculation as to why uTorrent has remained close source, which is extremely uncommon for BitTorrent clients.

This is not of concern to Strigeus, who told Slyck News, “This doesn't affect µTorrent, it's just a side project. If people like to be paranoid, I won't stop them.”

Strigeus denies that he is helping PeerFactor fight the P2P community by providing the coding.

“The agreement says that the software will be used to distribute legal content over the internet. In my understanding, everything in our agreement says that it will be used for downloading legal content,” Strigeus told Slyck News.

Although Strigeus rejects that he knew PeerFactor’s history of attacking and disrupting P2P networks, he defends working with the company now he does know.

“Just because I sell cleaning services to Microsoft doesn't mean I like Windows.”

Update: Please note there is a correction to this article. It was originally reported that PeerFactor is a subsidiary of RetSpan. The two companies parted ways six months ago.

PeerFactor deny ever being involved in anti-P2P operations, despite the reports to the contrary.

“We do not distribute any fake file over P2P, but only useful content,” Frenchman Richard Rodrigues, head of PeerFactor told Slyck. “We have never distributed fakes file (unreadable) because no user would […] want to distribute [them]."
http://www.slyck.com/news.php?story=1117





PG2 Blocks Utorrent.com
Ben Jones

Biggest news in the past few days in the p2p world is the Retspan story. Lots of inaccuracies and condemnations of Ludvig Strigeus (aka ludde) over his deal with peerfactor, subsidiary of Retspan, an anti-p2p association. Some claim its the end of the world, that the client will serve Retspan directly, and through the licensing of a single DLL file, ludde is permanently tainted as a traitor to p2p.

To this end, the current version of PG2+blocklist will block attempts to even visit the µtorrent website. The block gives the message "utorrent.com works for anti- p2p RetSpan". Mr. Strigeus described the block as 'ridiculous' and called for it to be removed. One of the admins at PG2, gong by the name "phrosty" blamed it on BlueTack, provider of their blocklist.

Over at BlueTack, admin "fa" appeared unaware of what the connection was between Mr. Strigeus and PeerFactor. When asked why the block was added, with the natural suggestion of "ignorance of what was actually going on" 'fa' replied "fuck you". Then, to Mr. Strigeus, present with me in their IRC channel, " you better pick the peeps you work for a littel better if you wanna make utorrent apps. its staying int"

Clearly BlueTack is not concerned about accuracy in any shape or form. A log of the discussion follows

[16:18.24] <+ludde> can you remove the silly PG2 "utorrent works for RetSpan" thing? I don't work for Retspan and I never will.
[16:30.45] <@fa> well, what is it that you are doing for them then?
[16:32.23] <@fa> or with them
[16:32.28] <+ludde> I'm providing a DLL file to PeerFactor, that they can use to download content through the BitTorrent protocol. It does not have any features for getting IPs or anything from users, it can only be used to download stuff.
[16:32.33] <+Benjones> I think thats been widely published everywhere
[16:32.50] <+ludde> exactly.
[16:33.56] <+Benjones> so, why was the block added?
[16:34.06] <+ludde> ignorance?
[16:34.32] <@fa> fuck you
[16:35.09] <@fa> you better pick the peeps you work for a littel better if you wanna make utorrent apps
[16:35.15] <@fa> its staying int
[16:36.24] <@fa> lol
[16:36.40] <+ludde> fa: utorrent is not related to anti- p2p. I don't see what the reason for the block is.
[16:37.10] <@fa> helping anti-p2p in any way is relating it to it
[16:37.43] <+ludde> I'm not helping anti-p2p. I'm helping a company (separate from retspan) that wants to provide a download service.
[16:37.45] <@fa> and yes, if you did the same for microsoft, you would have made the list as well
[16:38.00] <+ludde> so, microsoft is on the list?
[16:38.01] <@fa> staying in till the source is public
[16:38.27] <+ludde> that is not going to happen.
[16:39.23] <@fa> we have a list jsut for M$ yes
[16:39.46] <+ludde> fa: utorrent is not in any way related to anti-p2p. I'm just selling an "off the shelf" DLL product to PeerFactor, more or less.
[16:39.48] <@fa> they are the biggest anti-p2p organization
[16:40.23] <+ludde> this agreement is not about µTorrent.
[16:40.30] <+ludde> so I don't see why you punish utorrent.
[16:41.57] <+ludde> fa: can you remove the block please? If I was anti-p2p, I would never have created utorrent.
[16:42.32] <@fa> everyone should get to make the Decision for themselves, first they need to see that you have worked with them, then they can choose to use the app or not
[16:42.43] <@fa> the block is the best way atm to show peeps
[16:43.33] <+ludde> why put the decision on the people? They don't have enough information to tell what the deal is about. they just have the information provided by media, which is written in a way to generate attraction.
[16:44.25] <+ludde> this deal is really nothing, they contract doesn't even MENTION µTorrent.
[16:44.27] <@fa> the whole thing is dodgy as hell, they prolly needed that dll to build an anti-p2p torrent app, and you just handed it to them

Phrosty at Phoenix Labs was also present, and said "i don't think it utorrent.com should be blocked, but it's out of control of phoenix labs until we launch our own lists (soon)". As Ludde suggested, its clear that this is a decision made from ignorance. The value of these sorts of programs has never been proven either. Whilst protecting from overt lists might well keep you from the corporate networks, no-one rely on well known sources to search for copyright infringement. If you are relying on these lists to protect you from being found and prosecuted, you're investing in a false sense of security. Whilst they act on empty rumours and show little attention for the facts in compiling their lists, it leaves the question of just what value their lists are.

Can I recommend peerguardian? not until their blocklists are compiled by people who know what they're doing.
http://neuron2neuron.blogspot.com/20...orrentcom.html





Little-Used Corner Of Net Becomes Piracy Battlefield

Movie industry sues companies that aid downloads on Usenet
Hiawatha Bray

An obscure data network technology called the Usenet has become the newest battleground between the entertainment industry and digital music and movie pirates.

Late last month, the Motion Picture Association of America filed its first-ever lawsuits against Internet companies that help people download illegally copied films over the Usenet. The association says that the companies, NZB-Zone, BinNews, and DVDRS, provide a Google-like search service for Usenet, one that lets its users find thousands of pirated films, including recent hits such as ''King Kong," ''The Chronicles of Narnia," and ''The 40-Year-Old Virgin."

The three companies did not respond to e-mail messages requesting comment. Their websites do not list physical addresses or phone numbers, and one of them, DVDRS, has apparently been shut down. Even the lawsuits filed against the companies identify them as John Does, and do not include contact information.

A successful action against the three firms could lead to more lawsuits against other Usenet index sites, such as Newzbin.com and Nfonews.com. ''A common misconception among people who use networks like these is that they're in a group that is above the law," said movie industry association spokeswoman Kori Bernards. Indeed, she said the popularity of the Usenet as a place to swap illegal files has grown recently, perhaps because the music and movie industries have successfully shut down several distributors of peer-to-peer software, the most popular means of file swapping.

In a peer-to-peer system, users run software that links their computers to thousands of others on the Internet. The users can then search each other's computers for desirable files, and download the ones they want. But it's relatively easy to identify people using such software, because each computer must reveal its unique Internet address. Entertainment industry investigators can simply join the file-sharing network, then record the addresses of all the other machines. Armed with this information, investigators have sued thousands of people for downloading files illegally.

In addition, the entertainment industry last year won a major victory at the US Supreme Court, which held that companies that distribute file- swapping software can be held liable for encouraging people to break copyright law. Since then, several major peer-to-peer software distributors have shut down, including Grokster, WinMX, and i2hub.

Meanwhile, huge numbers of illegal video and music files are traded every day on the Usenet. Invented in 1980 at the University of North Carolina and Duke University, Usenet is like a giant bulletin board, featuring tens of thousands of ''newsgroups," each devoted to a particular subject, such as baseball, computer gaming, or anthropology.

Originally separate from the Internet, the Usenet is still not as fully integrated into the network as e-mail or the World Wide Web. Many Usenet bulletin boards can be accessed through the Google search service, which maintains an index of Usenet messages. Internet companies like Verizon Communications Inc. provide their customers with Usenet access at no additional charge. However, America's biggest Internet provider, AOL, stopped offering Usenet access last year.

The Usenet also has long been a center for illegal file swapping. The Usenet accepts only files of a limited size, written in plain text. But programmers wrote software that would take any kind of file, translate it into strings of text, and chop the strings into thousands of separate files. A downloader collects these files, and uses another program to turn them back into music, movies, or pirated software. Usenet also offers the downloader an extra measure of privacy, because the Internet address of his machine is known only to the Usenet server and can't be intercepted by investigators.

The Usenet has long been one of the primary sources for the illegal files found through peer-to-peer services, according to Eric Garland, chief executive of BigChampagne Media Measurement, a Los Angeles company that tracks illegal file downloads.

Garland compared Hollywood's attack on the Usenet companies to ''a strategic strike to cut off the supply, like a drug cartel. This is top of the food chain stuff."

Until now, it's been relatively difficult for ordinary Internet users to get at illegal Usenet files. They aren't indexed by Google, and downloading them is often a slow, painstaking process.

The three companies being sued by the movie industry use a technology that goes a long way toward solving this problem. The sites don't actually store illegal files. Instead, they offer indexes of the files based on NZB, a new search technology. NZB identifies and indexes millions of individual Usenet postings, sorting them into thousands of music and movie files. A visitor to one of the sites can type in the name of a movie and quickly get a list of the Usenet postings he must download. With software available at low cost over the Internet, a user can then connect to his Usenet account and easily download and reassemble the messages into a viewable movie.

The rise of NZB has attracted file downloaders like ''Frew," the Internet chatroom nickname of a 21-year-old network administrator in Tampa Bay, Fla. ''I have used newsgroups for a long while, but just started using NZBs to make things much easier about three months ago," wrote Frew, who didn't want to be identified for fear of prosecution. So far, Frew has downloaded ''Harry Potter and the Goblet of Fire," ''Jarhead," ''Flightplan," ''Full Metal Jacket," and ''Top Gun," among others. Frew said that he felt safe doing his downloads on Usenet, because unlike peer-to-peer systems, it's hard for investigators to identify the individual downloaders. ''The servers I use do not monitor what files you download," Frew wrote.

James Toledano, director of digital music at SafeNet Inc. in Morristown, N.J., said that Usenet trading of illegal files hasn't become a a large-scale problem yet. ''It is pretty small, but it's growing," Toledano said. One reason is that NZB downloading isn't free. The NZB search sites charge membership fees -- Binnews.com charges $5.50 a month, for instance. By contrast, peer-to-peer systems are free.
http://www.boston.com/business/techn...y_battlefield/





File Sharing? It's Great Business

Just months ago, the writing seemed to be on the wall for popular peer-to-peer technologies. How quickly things change
Bernhard Warner

When the US Supreme Court ruled last year that two popular peer-to-peer (P2P) file-sharing networks had knowingly facilitated mass copyright infringement, digital rights advocacy groups predicted the stifling of innovation, while Hollywood moguls cheered the decision as a victory for artists and the fatal blow to piracy.

How things can change in a few months. Today, P2P has an enormous user base using it for entirely legitimate purposes - and names from the entertainment industry such as Sky, NTL and Warner Brothers are rolling out services that rely solely on P2P technology.

Millions use the technology to make free internet-based phone calls through Skype. Academics use its grid-linking qualities to conduct scientific research. And on February 23 the technology received its highest endorsement of legitimacy yet. A group of policy makers from the European Information Technology Observatory and the Organisation for Economic Cooperation and Development (OECD) presented a study to lawmakers in Brussels calling P2P technology an important catalyst for job creation and economic growth; they advised governments to allow the proliferation of P2P applications.

"Peer-to-peer technology will be among the essential components of everyday communication ... chilling its legal use is like being against the steam engine in the 19th century," said Sacha Wunsch-Vincent, an OECD economist in its IT division.

Committed enemies

The biggest benefit of file-sharing technology may be felt in Hollywood - still a committed enemy of P2P networks.

Warner Brothers Home Entertainment Group broke ranks with other studios by announcing the rollout this spring of a European TV and movie download service based on P2P technology developed by Arvato Systems, a subsidiary of Bertelsmann, which owns the music giant BMG.

Expect more media conglomerates to focus on converting freeloaders into paying downloaders. Sky, working with P2P technology specialist Kontiki, is offering 200 movies and 1,000 sports highlight packages via download. The technology's ability to dice up large files enables relatively speedy downloads for viewers while minimising network bottlenecks for Sky - though it means that viewers' PCs will use their processing power and bandwidth to send parts of the files to other users, a fact some do not realise when they install the software (see http://tinyurl.COM1j02ah and http://tinyurl.com/z6uc6).

Meanwhile, the creators of BitTorrent, the popular file-sharing technology, are in discussions with movie studios, record labels and internet service providers to introduce online download services. The first such service for NTL, in which BitTorrent Inc has developed a video portal and download tool specifically for licensed content, will begin this month in select areas of Britain. The Norwegian web browser developer, Opera Software, has made BitTorrent the prominent download function for its latest Opera 9 release; more than 500,000 users downloaded the new browser in its first week.

And perhaps the most significant indication of P2P's rehabilitation came in November, when BitTorrent signed a deal with the Motion Picture Association of America (MPAA) to remove its members' copyrighted materials from BitTorrent.com's search engine.

What makes the alliance so extraordinary is that BitTorrent users are stealing business, downloading 650,000 movies daily, according to the MPAA. A year ago, lawyers might have cited such statistics as rationale for suing.

"The movie industry has seen the pain of the music industry and is determined not to go down that road," said Ashwin Navin, president and chief operating officer of BitTorrent Inc.

With more than 55 million users, some studios see BitTorrent downloads as the next DVD market. As BitTorrent traffic accounts for roughly a third of all internet traffic, telecommunications firms would like to work more closely with the outfit in a pay-for-download scheme.

BitTorrent is a vast improvement on the widespread file-sharing technology popularised by Napster in the late 9os. The latter had a central index of which computers had which files, and told your computer which computer to ask for a copy of that file. The two computers then moved the file directly. With BitTorrent, large files are chopped into manageable pieces that can be retrieved from multiple computers and reassembled into whole files. The pieces are simultaneously passed on to users, greatly reducing network congestion. The brilliance of the application is a twist on the network effect. Files passed on by the largest number of users also become the quickest to download. Not surprisingly, it has become the preferred way to download 500MB TV and film files.

One BitTorrent user who has benefited is 26-year-old Timo Vuorensola, from Tampere, Finland. Last year, Vuorensola and a crew of amateur Finnish actors and filmmakers created a feature-length Star Trek parody distributed solely over the internet. The 550MB file has been downloaded 10m times in the past six months, making it, by some estimates, Finland's most popular film.

Sell-out showings

Vuorensola's decision to offer free downloads of Star Wreck: In the Pirkinning from his website (www-fi3.starwreck.com) has had unforeseen commercial results. In January, Finnish TV station Yle TV2 aired it on a Saturday night, and the film had two sold-out screenings at a Norwegian film festival. Vuorensola said he sold more than 5,000 DVD copies, bringing in more than €100,000 (£68,000). Not bad for a film that cost €13,000 to make.

His success he owes to P2P, he said. "Some people - the older generation of filmmakers not so familiar with the internet - might have seen Star Wreck as some sort of bubble, which will explode. This is not a bubble. I believe it is a new form of film-making and film distribution."

It is unlikely major studios will ever seed BitTorrent with new releases. But a generation of filmmakers is exploiting the widespread adoption of P2P. Even so, working with a technology that is difficult to control will continue to limit investment in the short term. Warner says that without strict digital rights management it would not be launching its German video-download service. And the music industry is still wary of P2P.

"Everyone agrees that P2P is a fantastic technology but we will have to see whether it can be successfully converted into a legitimate and commercially viable business model," said Adrian Strain, a spokesman for the music industry's lobbying group, the International Federation of the Phonographic Industry.

Even Vuorensola has a horror story: pirated versions of Star Wreck recently hit the market in China and Russia claiming to be a Twentieth Century Fox production starring Russell Crowe. "But these things are inevitable," he said. "Giving away something or [setting a low price for] a download is the best way to fight the piracy problem. It doesn't make sense to demonise the whole technology."

·Bernhard Warner is a technology writer based in Rome.
http://technology.guardian.co.uk/wee...726242,00.html





French Government Overturns Legalization Of File-Sharing Networks

The French government has suddenly withdrawn the "Global License" that the country's National Assembly had already approved for the legalization of file sharing, including copyrighted works, from its current proposal for controversial copyright reform. A number of parliamentarians protested vehemently when the executive filed the latest version of the bill last Tuesday evening, but thanks to the majority of the conservative governing party Union pour un Mouvement Populaire (UMP) the National Assembly nonetheless managed to prevent the opposition from having the revisions put back on the agenda.

Before the government made this move, the music industry and a number of well known singers and composers led by such veterans as Johnny Hallyday, Charles Aznavour, and Jean-Michel Jarre had protested against the "cultural flat rate" that this blanket approval of file sharing would have allegedly entailed. The artists argued that the flat fee of 8 to 12 euros that was being discussed would not have been equal to their traditional revenue from album sales. Home Secretary Nicolas Sarkozy also called file sharing "theft."

Consumer protection organization UFC-Que Choisir countered that some 10 million of France's 60 million citizens had already used Peer-2-Peer networks according to market research studies and that a business and compensation model was therefore already needed. UFC maintains that it is wrong to put the private use of works by consumers entirely under the control of companies by means of Digital Rights Management (DRM) systems.

Oppositional socialist leader Jean-Marc Ayrault accused the government's harsh strategy as "a panic reaction." At the same time, his party colleague Christian Paul called for the whole reform project to be withdrawn, not just parts of it. Other representatives spoke of a "betrayal" of parliament. Christine Boutin, a representative of UMP who originally voted in favor of the P2P clause, voiced her concern that the government's plan would "drive Internet users into piracy."

Despite this criticism, Minister of Culture Renaud Donnedieu de Vabres aims to get his proposals for a revision through parliament in the next few days. Among other things, they include a ban on private copies of DVDs. But the Minister did reduce the penalties for such non-commercial violations of copyright. After a number of upcoming debates, the final vote on the revision of copyright is to take place in mid-March.
http://www.heise.de/english/newsticker/news/70605





Web Site Courts Fans Looking to Swap CDs
Alex Veiga

The firm behind a new music Web site is hoping to lure fans looking to swap their used, album-length CDs for the price it typically costs to buy a digital single.

The Web site, lala.com, allows members to list which CDs they wish to put up for trade and then use a search engine to browse for album titles being offered by other members.

Unlike eBay or other trading sites where computer users bid on goods and then arrange payment and shipping themselves, buyers on lala.com always pay $1 plus 49 cents for shipping.

Palo Alto-based la la media, which runs the Web site, sends prepaid envelopes for the site's users to mail their CDs.

The site also sells new CDs and digital album downloads at retail prices, in case someone on the Web site isn't offering a particular album.

The company began testing the site in November with select users. Prior to this week, it had 250 members trading some 12,000 CDs out of a catalog of 1.8 million album titles, said co-founder Bill Nguyen.

On Tuesday, the company expanded access to the site to people who are referred by existing members. It plans a full launch this summer.
http://www.latimes.com/technology/at...-toptechnology





Labels Halt Downloads to Increase CD Sales
Jeff Leeds

As blockbuster hits go, the R&B smash "So Sick" is hardly new territory for the 23-year-old singer known as Ne-Yo. Before crooning the song on his own album, he was a co-writer on the 2004 chart-buster "Let Me Love You" for the singer Mario.

But there's one big difference: even though fans could hear "So Sick" on the radio for the last two months, they couldn't buy it at popular online services like iTunes or Rhapsody, or anywhere else for that matter. Breaking from the music industry's current custom, the singer's label — Island Def Jam — decided not to sell "So Sick" as an individual song before Ne-Yo's album hit stores last week. Label executives worried that releasing the track too early might cut into sales of the full CD — a fear that figures heavily in the music world's lumbering entry into the digital marketplace.

The results of fans' pent-up demand for Ne-Yo are now clear: his CD "In My Own Words," burst onto the national album chart yesterday at No. 1, with sales of more than 301,000 copies, easily ranking as the biggest debut of the year so far. And just as eye-popping: the digital single of "So Sick" sold almost 120,000 copies in its first week, according to Nielsen SoundScan.

There is still plenty of debate over the effect of holding off on sales of the digital single; many also note that Island Def Jam offered a discount to retailers who stocked the album, allowing it to sell at stores like Target for $7.98 last week.

But if the industry determines that restricting digital sales pays off with bigger album sales, fans may soon find the instant gratification of snapping up new songs online becoming a little less instant.

No one is talking about a wholesale shift away from the now-common practice of selling singles online ahead of new albums.

But even before Ne-Yo's big debut, some music executives fretted that they were offering too many songs too early, particularly from pop and R&B acts.

So consumers looking for some hot new songs may have trouble finding them before the corresponding albums are released. "S.O.S.," a rising radio hit from the Caribbean-born ingénue Rihanna (a label-mate of Ne-Yo), is not expected to be available for sale online before her forthcoming album. And Shakira fans will not find her new song, "Hips Don't Lie," for sale at any of the major online music services, music executives said. (Shakira's label, Epic Records, did strike a deal to sell the song to customers of Verizon's V-Cast cellphone service. "Hips" is to be included on a repackaged edition of Shakira's recent CD.)

The restricted sales are evidence that record companies are a re-examining the fledging digital music field, where consumers have become accustomed to easy — and early — access to new stars' work. In the early days of paid digital sales, major labels routinely refused to sell singles or albums online until well after the "physical" recording went on sale at brick-and-mortar stores.

Since at least 2004, however, record companies have been selling songs online at the same time they begin lobbying radio stations to play them — generating a bit of cash as each song gained popularity. Holding back on new singles now, critics charge, may end up doing more harm than good in the long run, especially if music continues to be available on free, unauthorized online networks.

"The labels are shooting themselves in the foot," said Tim Quirk, executive editor of the Rhapsody music service. To the labels, Mr. Quirk advises, "every single track that you are worried about is available for free whether you want it to be or not."

"You need to take advantage of every possible opportunity for people to pay in legitimate ways," he said.

But in the case of Ne-Yo, whose real name is Shaffer Smith, the first-week sales figures vindicate their strategy, executives say. It is impossible to know how many fans would have bought Ne-Yo's single as it became a radio smash, but the executives reckon that whatever price Island Def Jam paid in lost singles, it more than made up for in extra sales of the album, which costs more.

Contrast the Ne-Yo experience with another new R&B star, Chris Brown. He had a similarly inescapable radio hit with the song "Run It!" on the eve of his debut album's release late last year. "Run It!" was available for sale online for more than three months before his eponymous CD hit stores. During that time, Mr. Brown's song sold more than 300,000 copies. When the album finally went on sale, it sold roughly 154,000 copies in its first week — about half the sales of the Ne-Yo recording, according to Nielsen SoundScan.

Steve Bartels, chief operating officer of Island Def Jam, a unit of the music giant Universal Music Group, said the early availability of hot singles online could hurt albums of consistent quality throughout.

"If you know you have something of depth, you have to be careful about how you bring it into the marketplace," he said. "We're in the business of having consumers believe in an artist. If everything is up and gone before you have a chance to listen to the album, what do you have?"

Mr. Bartels added, however, that decisions to hold back singles are being made on a case-by-case basis, and could vary widely depending on genre. He noted that the label is already selling a single from the rock band Damone, even though its album is not expected in stores until May.

It is also worth noting that, as analysts said, the single has been still heavily traded on free file-swapping networks for weeks. Ne-Yo's "So Sick" was downloaded approximately 3.4 million times on the networks during the week of his album release, according to the tracking firm BigChampagne. By comparison, Chris Brown's "Run It!" was downloaded approximately 5.3 million times during the week of his album release last year.

Elsewhere, however, as consumers shift into a world dominated by singles, custom playlists and iPod song shuffling, there are efforts under way to preserve the old- fangled album. Fans who are still willing to shell out for a full album are rewarded with exclusive bonus items: Universal Records recently offered a downloadable coloring book to fans who bought its "Curious George" soundtrack by Jack Johnson. And fans of the made-from-television band INXS who bought its full album received an exclusive bonus track.

Industry caution about early sales of singles, however, actually comes as fans are buying individual songs at such a rapid clip that they are — for the first time — regularly offsetting the decline in full album sales. So far this year, album sales have declined about 3 percent from a year ago. But if every 10 singles sold so far were bundled together and counted as albums, sales would be up about 2 percent, according to Nielsen SoundScan.

Even so, some music executives insist the "unbundling" of the album — letting fans buy individual tracks — still spells trouble.

Tony Brummel, the owner of the independent rock label Victory Records, says he is not interested in selling individual songs from his albums, though he may give them away to build buzz. The label this week captured the No. 3 spot on the chart with the new album from the emo-rock band Hawthorne Heights. The band's CD sold about 114,000 copies — a solid figure for an independent rock band, but somewhat less than expected given the label's shipments of roughly 800,000 copies. A rock album, Mr. Brummel said, "is a work of art."

"If you're buying a Picasso," he continued, "you can't just buy the upper right-hand corner."
http://www.nytimes.com/2006/03/09/ar...in&oref=slogin





World Box Office Dipped 7.9 Pct to 23 Billion Dollars Last Year: Study

Hollywood movie ticket sales around the world dropped by 7.9 percent last year to 23 billion dollars, with the US box office accounting for nearly 40 percent of the haul, a study showed.

Movie ticket receipts in North America dipped by six percent in 2005 to nine billion dollars, according to a study by the ratings statistics firm Nielsen Entertainment/NRG that comes as movie-goers increasingly stay out of cinemas.

The study, released by the powerful lobby group of the major Hollywood studios, the Motion Picture Association of America, however gave the industry some reason for hope amid sliding ticket receipts, the MPAA maintained.

Most movie-goers were satisfied with their recent experiences at the movies and felt the movies were a "good investment of their time and money," the Nielsen study reported.

"Despite increasing competition for consumers' time and entertainment dollars, theater-going remains a satisfying constant in people's lives," said MPAA chief executive Dan Glickman.

"That said, we can't bury our heads in the sand. We have to do more to attract customers and keep regulars coming back. It is no secret that our industry faces new challenges but with every challenge, there is an exciting opportunity," Glickman added.

The MPAA noted that eight movies had raked in more than 200 million dollars at the box office last year, compared with just five in 2004.

The total number of films released in the United States increased by 5.6 percent from 2004, while new releases by the major motion picture studios grossed an average of 37 million dollars in 2005, an increase of seven percent over the past five years," the industry group said.

Most movie-goers in 2005 went out to catch family films, with movies rated PG-13, meaning that children under 13 must be accompanied by an adult, accounting for 85 percent of the most watched films in 2005.

The MPAA also reported that the average production cost of a movie in 2005 remained below 100 million dollars and dipped slightly to 96.2 million dollars.

Marketing costs however rose by 5.2 percent, while production costs went down four percent from 2004.

The big studios that make up the MPAA spent more on network television and Internet advertising and less on newspapers and local television, the group said.

"Technology has not only changed the way people are able to view movies, it has changed the way our industry produces and advertises movies," said Glickman.

"We are exploring new ways to reach more people using innovative methods of communication and distribution. This data reflects those changes and also demonstrates the strength of the movie industry." MPAA members include the top Paramount Pictures, Sony Pictures Entertainment, Warner Bros, Metro-Goldwyn-Mayer Studios, Universal Studios Inc, Walt Disney Co. and 20th Century Fox.
http://www.breitbart.com/news/2006/0....c3imi3s8.html





Peering into the Future:

Why P2P Is the Future of Media Distribution Even If ISPs Have Yet to Figure That Out
Robert X. Cringely

"If you build it, they will come."

Maybe.

Residential broadband use is still growing in America, but the rate of growth has fallen significantly according to a pair of studies covered last week in this column. This is nothing dreadful and nothing permanent, but under the current system of solely personal computers using the Internet, it will take another generation (20 years) to reach near-100 percent market penetration comparable to telephones. Ironically, by that time homes with traditional hard-wired phone lines will have dramatically decreased, showing us the other end of the bell curve as technologies become obsolete. But it doesn't have to be this way, as technology companies well know. The way to kick broadband growth back into top gear is to change the nature of the network and its interfaces, adding phones, television, and home automation to the mix. And that's why we see huge efforts in all these areas. But the point I made last week that inspires this week's column is the idea that only through peer-to-peer data distribution can this new network operate efficiently.

It is very hard to get your mind around the enormity not of the Internet, but of the Internet-on-steroids we'd need to absorb most other forms of communication and media distribution, but let's try anyway. "Desperate Housewives," in its puny 320-by-240 iTunes incarnation, occupies an average of 210 megabytes per episode. A full-resolution version would be larger still. In theory, it would be four times as big, but practically it would probably come in at double the size or 420 megabytes. But let's stick with the little iTunes version for this example.

Twenty million viewers, on average, watch "Desperate Housewives" each week in about 10 million U.S. households. That's 210 megabytes times 10 million downloads, or 2.1 petabytes of data to be downloaded per episode. Fortunately for the download business model, not everyone is trying to watch the show at the same time or in real time, so iTunes, in this example, has some time to do all those downloads. Let's give them three days. The question on the table is what size Internet pipe would it take to transfer 2.1 petabytes in 72 hours? I did the math, and it requires 64 gigabits-per-second, which would require an OC-768 fiber link and two OC- 256s to fulfill.

There isn't an Internet backbone provider with that much capacity, much less excess capacity. Fortunately, it wouldn't have to all go over a single link and could, instead, be injected centrally into the network and fan out to viewers all over the country, in which case the OC-48 and OC-192 links used by Global Crossing, Sprint, MCI and others just might be enough.

But that's just one popular show. What will we do, then, with American Idol?

Ah, but remember Moore's Law, which is going to increase our bandwidth dramatically over time! It doesn't matter. Throw 250 million viewers watching 180 channels up on the Net, raise the resolution to full broadcast then raise it again to HDTV, and even Moore's Law won't catch up. Just carrying all the viewers of "Desperate Housewives" at the current iTunes resolution won't be economically viable for another decade according to Moore's Law.

I am no Luddite. IP is the future of global communication on all levels. But adding video to the mix is so bandwidth intensive that using current techniques will push back total IP conversion for decades.

Still, there is incredible incentive to push this digital conversion and a heck of a lot of money on the line. So we'll just have to cheat.

And that brings me back to the peer-to-peer schemes I discussed a little last week. By using excess upload capacity of client nodes as repeaters, putting together 64 gigabits-per-second actually isn't that hard. Stealing 256 kilobits per client would require a total of 256,000 participating clients to do the job, which is only 2.5 percent of the total "Desperate Housewives" viewer population.

There are some who believe Bit Torrent alone can do the job, but I feel that a true media market is going to require more components than are currently offered in Bit Torrent. There have to be payment systems, rights management systems, and some underlying quality-of-service layer that can save the day just in case you are the only person in the world who wants to watch that particular episode of "The Green Hornet."

Last week, I wrote about Seattle-based Grid Networks, which has many of the networking components in place. Grid, which already has more than 100,000 active nodes, can reliably deliver massive amounts of data at bit rates as high as clients are capable of receiving. That's a key differentiator -- being able to aggregate bandwidth to deliver not only lots of data, but lots of data FAST. Grid also appears to be the only major player in this new space that plans to offer Windows, Linux, and Macintosh clients, while most of the other services seem to be Windows-only.

Another emerging player in this space is Network Foundation Technologies (NFT), a startup in Louisiana that is taking the very non-Bit Torrent approach of using a binary-tree (one parent) distribution model rather than Bit Torrent (or Grid's) multi-parent distribution. Binary-tree distribution means that every node in the network has a single parent and no more than two children, which limits the total available bandwidth per connection. So where Grid and Bit Torrent can dump a lot of data very quickly on a given client, NFT is limited to half the capacity of the node above it in the distribution tree. While this would appear to be a disadvantage, there is one very good reason for doing it: NFT's binary distribution trees support live video.

NFT's binary trees form and re-form dynamically as client nodes appear and disappear from the network. The system is based on TCP, not UDP, and has been shown to support 14 or more levels, which is enough for tens of thousands of nodes, all fed from a single master connection equivalent to DSL. That means if you are willing to live with sub-megabit bandwidth, you could start an NFT video channel from your cable modem. Every man a TV network. System delay varies from 30 seconds to two minutes, but you could watch a live football game on NFT, where you couldn't easily do so on the multi-parent systems.

The emerging Big Kahuna in commercial peer-to-peer seems to be Wurld Media's Peer Impact, which has similar technology to Grid Networks (though Windows-only), but where Grid is a networking company, Peer Impact is a media company and actually has a pretty compelling business model.

Peer Impact is up and running right now, though most of what the network has available isn't TV or music, but video games. About 1,100 video games from most major publishers except Electronic Arts are available through Peer Impact. The network has also announced it is adding video content and movies from NBC/ Universal, and says it will have all major film studios and all major record companies onboard by the end of this year.

Peer Impact is similar to iTunes in that Apple sets the price ($0.99 per song and $1.99 per show). Where Peer Impact is different is in its use of Microsoft DRM, Windows client software, and a peer-to-peer distribution scheme. But where the company is REALLY different is in its relationship to participating nodes: Peer Impact pays users.

Ten percent of gross revenue for Peer Impact goes back to the participating nodes through two different programs. The first program is simple carriage: If someone downloads a song through your node, you get paid based on what percentage of the total bytes you provided, with five percent of gross revenue devoted to that task. The other five percent is for people who actively promote certain content through fan sites, for example. If you run a web site honoring the works of John Cassavetes, it could include links to his movies. If someone downloads "Minnie and Moskowitz" through your site, you get five percent of the download fee even if you don't actually carry any of the bits. If you carry some or all of the bits, you can get up to another five percent. All this is handled through PayPal and Peer Impact assumes most participants will spend most of that on more movies, which is part of their reason for doing it this way.

Here, finally, is a business model for video distribution that makes some sense. Nobody gets rich, but members are at least partially compensated for their participation, which ought to make the network robust and explains all those content deals with studios and record companies.

The best way to make money with Peer Impact, it seems to me, is through video games, which cost up to $30 or more and can be downloaded as 30-day demos. The trick, then, is to have a game fan site, stock it with demos that establish you in the distribution system without having to actually buy the games, and collect $1.50 to $3.00 every time someone downloads through your site.

Of course, there is an argument against all of this, that the ISPs won't allow it. But understand that it is my job to look into the future, and as explained above, there simply is no alternative to this kind of solution if the Internet is to grow and subsume these more traditional media types. That means IT IS IN THE INTEREST OF THE ISPs FOR THIS TO HAPPEN. It helps them, too, by creating a distribution system that jumps 20 years ahead of Moore's Law yet not putting a significant impact on the most expensive part of their operation, their Internet backbone links. Intra-ISP bandwidth is cheap, especially if it is within the same Point of Presence or data center. Inter-ISP bandwidth is expensive. By having enough peering nodes inside the ISP, connections to the greater Internet can be minimized and costs kept under control.

In short, if this technology didn't already exist, the ISPs would have to invent it, even if they don't yet understand that concept. In time they will. In fact, it would be to their advantage to take it upstream and put the client software in the DSL or cable modem, and effectively become a reseller for peer-to-peer content.

That last bit is a frigging brilliant idea and somebody should run with it.

I've mentioned three companies here, so which will be the winners and which the losers? Right now, they all look like winners to me. Peer Impact has the business model and the distribution deals. Grid Networks is cross-platform and more flexible so it will appeal as a second standard as well as having a deep IP portfolio that could become quite strategic. And Network Foundation Technologies plays the live TV card, which means sports and news events can be watched live just like we are used to doing in the current cable and broadcast TV systems.

They could succeed on baseball, basketball, and football alone.
http://www.pbs.org/cringely/pulpit/pulpit20060302.html





In Praise Of Always-On Connectivity
Asher Moses

Contrary to popular opinion, always-on connectivity isn't eliminating our social lives. In fact, it's giving us more time to do the things we've missed whilst stuck in the 9-to-5 grind, writes Asher Moses.

There are two dominant schools of thought surrounding the impact that ubiquitous wireless networking and always-on connectivity will have on our working and personal lives. The first is that it'll totally eliminate any semblance of a social life we once had, since we'll be able to cart the office around with us wherever we go and, as a result, the demands on our productivity will increase exponentially.

The second -- and this is the one that I happen to favour -- is that rather than obliterate our social lives, always-on connectivity and the increased flexibility it brings will allow us to break free from the office and actually socialise more. Sure, you'll be on call at unusual hours of the day, but think about how much more efficient you'll be -- particularly if your most productive hours aren't between 9am and 5:30pm! And besides, all newfangled technology comes with an "off" switch should you find yourself needing some down time.

Picture this. It's 10am on Monday morning. You've just woken up and are perched in your home office, downloading the plethora of weekend e-mails that await your response. You took the liberty of sleeping in this morning, since you spent an hour or so finishing off some work in your idle time on Saturday and Sunday.

You're in the process of bashing out an e-mail when your mobile rings. It's your mate from across the street, wondering if you're able to take an hour or two out from your day to catch up for breakfast. A plate of bacon and eggs would go down nicely after the booze-infested weekend you've just had, and your stomach rumbles in agreement.

You agree to meet with your friend, save a draft of the e-mail you're currently working on, grab your PDA and head out the door. You're not worried about getting behind on your work, since you know you'll be able to pick up from where you left off wherever you are. All of your important files and applications -- including e-mail -- are stored online, so there's no need to sync your PDA with your desktop each time your leave the office. Further, the wireless network that blankets your city ensures constant access to these files, so you can continue responding to your messages whilst waiting for your food at the café.

Are you starting to see past the Luddite cries of the naysayers yet? Are the social benefits of always-on connectivity becoming more apparent? What's more, we've just touched on one of the many scenarios where a seamless, completely mobile home office could benefit you.

Ubiquitous wireless networking isn't as far away as you may think. It's already close to becoming a reality in the UK, while a number of US cities have city-wide Wi-Fi plans including San Francisco, Manhattan, New Orleans and Philadelphia. It's just a matter of time before similar ventures hit Australia.

The only other ingredient necessary for a fully mobile workforce is the storing of our most-used files and applications online, and as we've noted previously, this is also a concept that is rapidly gaining followers in both tech savvy and mainstream circles.

Ultimately, rather than working for one solid eight-hour (or longer) slog each day, your work and social lives will be mixed. This may sound scary at first, but it'll undoubtedly result in increased leisure time and greater productivity. The implications of this are truly astounding, as basic economic theory has long seen leisure time and productivity as opportunity costs of one another.
http://www.cnet.com.au/mobilecomputi...0060780,00.htm





I hear you knocking

Hey Neighbor, Stop Piggybacking on My Wireless
Michel Marriott

For a while, the wireless Internet connection Christine and Randy Brodeur installed last year seemed perfect. They were able to sit in their sunny Los Angeles backyard working on their laptop computers.

But they soon began noticing that their high-speed Internet access had become as slow as rush-hour traffic on the 405 freeway.

"I didn't know whether to blame it on the Santa Ana winds or what," recalled Mrs. Brodeur, the chief executive of Socket Media, a marketing and public relations agency.

The "what" turned out to be neighbors who had tapped into their system. The additional online traffic nearly choked out the Brodeurs, who pay a $40 monthly fee for their Internet service, slowing their access until it was practically unusable.

Piggybacking, the usually unauthorized tapping into someone else's wireless Internet connection, is no longer the exclusive domain of pilfering computer geeks or shady hackers cruising for unguarded networks. Ordinarily upstanding people are tapping in. As they do, new sets of Internet behaviors are creeping into America's popular culture.

"I don't think it's stealing," said Edwin Caroso, a 21-year-old student at Miami Dade College, echoing an often-heard sentiment.

"I always find people out there who aren't protecting their connection, so I just feel free to go ahead and use it," Mr. Caroso said. He added that he tapped into a stranger's network mainly for Web surfing, keeping up with e-mail, text chatting with friends in foreign countries and doing homework.

Many who piggyback say the practice does not feel like theft because it does not seem to take anything away from anyone. One occasional piggybacker recently compared it to "reading the newspaper over someone's shoulder."

Piggybacking, makers of wireless routers say, is increasingly an issue for people who live in densely populated areas like New York City or Chicago, or for anyone clustered in apartment buildings in which Wi-Fi radio waves, with an average range of about 200 feet, can easily bleed through walls, floors and ceilings. Large hotels that offer the service have become bubbling brooks of free access that spill out into nearby homes and restaurants.

"Wi-Fi is in the air, and it is a very low curb, if you will, to step up and use it," said Mike Wolf of ABI Research, a high-technology market research company in Oyster Bay, N.Y.

This is especially true, Mr. Wolf said, because so many users do not bother to secure their networks with passwords or encryption programs. The programs are usually shipped with customers' wireless routers, devices that plug into an Internet connection and make access to it wireless. Many home network owners admit that they are oblivious to piggybackers.

Some, like Marla Edwards, who think they have locked intruders out of their networks, learn otherwise. Ms. Edwards, a junior at Baruch College in New York, said her husband recently discovered that their home network was not secure after a visiting friend with a laptop easily hopped on.

"There's no gauge, no measuring device that says 48 people are using your access," Ms. Edwards said.

When Mr. Wolf turns on his computer in his suburban Seattle home, he regularly sees on his screen a list of two or three wireless networks that do not belong to him but are nonetheless available for use. Mr. Wolf uses his own wired network at home, but he says he has piggybacked onto someone else's wireless network when traveling.

"On a family vacation this summer we needed to get access," Mr. Wolf recalled, explaining that his father, who took along his laptop, needed to send an e-mail message to his boss on the East Coast from Ocean Shores, Wash.. "I said, 'O.K., let's drive around the beach with the window open.' We found a signal, and the owner of the network was none the wiser," Mr. Wolf said. "It took about five minutes."

Jonathan Bettino, a senior product marketing manager for the Belkin Corporation, a major maker of wireless network routers based in Compton, Calif., said home- based wireless networks were becoming a way of life. Unless locking out unauthorized users becomes commonplace, piggybacking is likely to increase, too.

Last year, Mr. Bettino said, there were more than 44 million broadband networks among the more than 100 million households in the United States. Of that number, 16.2 million are expected to be wireless by the end of this year. In 2003, 3.9 million households had wireless access to the Internet, he said.

Humphrey Cheung, the editor of a technology Web site, tomshardware.com, measured how plentiful open wireless networks have become. In April 2004, he and some colleagues flew two single-engine airplanes over metropolitan Los Angeles with two wireless laptops.

The project logged more than 4,500 wireless networks, with only about 30 percent of them encrypted to lock out outsiders, Mr. Cheung said.

"Most people just plug the thing in," he said of those who buy wireless routers. "Ninety percent of the time it works. You stop at that point and don't bother to turn on its security."

Martha Liliana Ramirez, who lives in Miami, said she had not thought much about securing her $100-a-month Internet connection until recently. Last August, Ms. Ramirez, 31, a real estate agent, discovered a man camped outside her condominium with a laptop pointed at her building.

When Ms. Ramirez asked the man what he was doing, he said he was stealing a wireless Internet connection because he did not have one at home. She was amused but later had an unsettling thought: "Oh my God. He could be stealing my signal."

Yet some six months later, Ms. Ramirez still has not secured her network.

Beth Freeman, who lives in Chicago, has her own Internet access, but it is not wireless. Mostly for the convenience of using the Internet anywhere in her apartment, Ms. Freeman, 58, said that for the last six months she has been using a wireless network a friend showed her how to tap into.

"I feel sort of bad about it, but I do it anyway," Ms. Freeman said her of Internet indiscretions. "It just seems harmless."

And if she ever gets caught?

"I'm a grandmother," Ms. Freeman said. "They're not going to yell at an old lady. I'll just play the dumb card."

David Cole, director of product management for Symantec Security Response, a unit of Symantec, a maker of computer security software, said consumers should understand that an open wireless network invites greater vulnerabilities than just a stampede of "freeloading neighbors."

He said savvy users could piggyback into unprotected computers to peer into files containing sensitive financial and personal information, release malicious viruses and worms that could do irreparable damage, or use the computer as a launching pad for identity theft or the uploading and downloading of child pornography.

"The best case is that you end up giving a neighbor a free ride," Mr. Cole said. "The worst case is that someone can destroy your computer, take your files and do some really nefarious things with your network that gets you dragged into court."

Mr. Cole said Symantec and other companies had created software that could not only lock out most network intruders but also protect computers and their content if an intruder managed to gain access.

Some users say they have protected their computers but have decided to keep their networks open as a passive protest of what they consider the exorbitant cost of Internet access.

"I'm sticking it to the man," said Elaine Ball, an Internet subscriber who lives in Chicago. She complained that she paid $65 a month for Internet access until she recently switched to a $20-a-month promotion plan that would go up to $45 a month after the first three months.

"I open up my network, leave it wide open for anyone to jump on," Ms. Ball said.

For the Brodeurs in Los Angeles, a close reading of their network's manual helped them to finally encrypt their network. The Brodeurs told their neighbors that the network belonged to them and not to the neighborhood. While apologetic, some neighbors still wanted access to it.

"Some of them asked me, 'Could we pay?' But we didn't want to go into the Internet service provider business," Mrs. Brodeur said. "We gave some weird story about the network imposing some sort of lockdown protocol."

Andrea Zarate contributed reporting from Miami for this article, and Gretchen Ruethling from Chicago.
http://www.nytimes.com/2006/03/05/te...wireless.html?





The High-Speed Money Line
Ken Belson

Are consumers going to start having to spend a lot more to surf the Web?

Phone and cable companies have stoked those fears recently by floating plans that would have Amazon, Yahoo and other Web sites paying new fees to ensure that their content will be delivered to customers faster.

This possibility has raised the prospect that consumers may end up having to pay twice for access to the Internet — once to the phone or cable company that sells them a dial-up or broadband line, and again to Internet companies that pass along new charges for fast access to content from their sites.

Late last year, the Bells proposed to share the burden of upgrading their networks — particularly as big video files, which take up a lot of bandwidth on the networks, become more common — with the companies sending out that data. The plan quickly drew fire from consumer groups, technology companies and lawmakers eager to preserve open access to the Internet and fearful that the Bell companies have too much power.

Those worries were highlighted yesterday when AT&T announced plans to buy BellSouth for $67 billion, a merger that would create a telecommunications giant with $130 billion in sales and 70 million local phone customers in 22 states.

If a plan like the one the Bells are proposing were to come into effect, consumer prices might not increase immediately, consumer advocates, industry analysts and telecommunications executives say. But one way or another, consumers are likely to shell out more in the future for Web content.

The reason, they say, is simple. As Internet traffic booms and competition intensifies, the phone and cable companies are spending billions of dollars to expand their networks — and they want someone to help them foot the bill.

"The networks of today have to be upgraded," said Carl Russo, the chief executive of Calix, a company that sells Internet television equipment. "You can push this bag around all you want, but at the end of the day, we will pay for it."

The most obvious tactic would be to raise consumers' subscription rates. But Mr. Russo and others say that is unpalatable to the Bells, which portray themselves as the low-cost broadband providers, and even harder for cable companies, which already charge subscribers premium prices for their faster connections.

The government is unlikely to fork over any money to help the cable and phone companies expand their networks. Lawmakers would be pilloried if they used taxpayer dollars to subsidize the highly profitable telecommunications companies directly. So phone and cable companies are turning to a new source: Web content providers. For the most part, the Internet sites now get a free ride because network operators have to transport equally all data that travels on their networks. Some content providers do buy extra servers so that consumers can zip around their sites more quickly, but they absorb that cost themselves.

The idea of the service providers is to create a system where Web sites can, for a fee, bump their data into a kind of fast lane, where it will not be mixed in with everyone else's. A mom-and-pop online retailer might consider this unnecessary, but a company selling, say, videos online could see it as crucial.

"If other players want to take advantage of our network and need something to make their applications available to consumers, we will work with them as partners," said Thomas J. Tauke, executive vice president of public affairs, policy and communications at Verizon. "We anticipate that they will develop applications that need more bandwidth" in the future.

Companies like Amazon.com, eBay and Google fear that if they do not buy faster access, they could end up in a slow lane.

The Bells contend that the fast lanes they are proposing will not slow down other traffic because their networks are big enough to accommodate everyone.

"No one service takes away from the other because of the huge pipes," Mr. Tauke said of his company's network.

Some critics are skeptical and say the Bells' plans to sell television routed over their networks will leave less space for other content. Regardless, if two tiers of delivery speed were offered, content providers would feel compelled to get the faster service if only to keep up with their rivals who had the service. That could become costly.

"There's no limit to what they could charge for this high-speed lane and they could make the slow-speed lane as slow as they want," said Rich Tehrani, president of Technology Marketing Corporation, a media company that promotes Internet phone service. "There's no way to know today what the prices might be, but it could be anything, and that's the fear."

Mr. Tehrani and others fear that companies that compete with the network providers — for instance, the Internet phone provider Vonage — may not get the chance to sign up for faster access, even if they want it.

But the phone and cable industries have powerful allies in Congress who are already proposing legislation that would let them introduce this tiered service. If the telecommunications companies get their way, the most obvious candidates to pay for the premium service are companies that offer videos, music and other data-heavy products. Consumer advocates worry that if Apple, which runs the iTunes site, starts paying network operators for faster access, it may try to offset the cost by raising the price of a downloadable TV show, now $1.99, by a dime or two.

But the charge-for-delivery model is already under attack in a slightly different forum. A collection of public interest groups are protesting a plan by America Online to charge high-volume senders of e-mail fees for guaranteed premium delivery of their messages. The groups fear that charities, small businesses and others that do not pay the fees will be at a disadvantage.

As an alternative, Apple or other content providers that sign up for premium delivery could set up tiered services of their own. They could, for example, create premium sites where customers would pay annual subscription fees to download songs and videos faster than at the company's free site.

The trouble is that only the most passionate iTunes fans might pay for a subscription, analysts say, so Apple could be forced to absorb the cost of paying network operators for access to their "fast lanes."

"Economics 101 says that if iTunes raises its rates, some consumers will switch to other music download sites, download fewer songs or even make more illegal downloads," said Bruce Leichtman, who runs the Leichtman Group, a market research group which follows the cable and phone industries. "The higher price would lower demand in some shape or form."

Another possibility, critics say, is that smaller Web sites would be crowded out. A big company like Apple, they argue, has the money to pay network providers for faster access and absorb the cost. But mom-and-pop online Web sites might not. If they were unable to compete with bigger, faster sites, the result could be less diversity of content on the Internet.

"Tollbooths and gatekeepers are the exact opposite of what the Internet is all about," said Michael J. Copps, a Democratic commissioner at the Federal Communications Commission. "Down that route consumers can count on paying more and getting less — less content, fewer services and reduced innovation."

The big network operators argue that they would never deliberately slow or block access to Web sites, because doing so would raise a furor in Washington. Besides, they say, angry consumers could switch Internet providers in protest.

That may be true in big cities like New York and Washington, where there is a variety of Internet service providers. But in many other cities, there are typically two and sometimes only one broadband provider — the cable or phone company.

In many cases, "there's nowhere else to go," said Paul Misener, the vice president of global public policy at Amazon. "The market power that these folks have is real, and it is not going to change any time soon."
http://www.nytimes.com/2006/03/06/te...roadband.html?





Vonage Protests Special Fees On VoIP Telephones
CBC News

Vonage Canada, a leading provider of internet telephones, wants federal regulators to investigate what it calls a "thinly veiled VoIP tax" by one of its competitors.

Joe Parent, vice-president of marketing for Vonage Canada, said Tuesday that Shaw Communications was using the so-called tax to unfairly drive up VoIP prices in Western Canada.

He filed a request to the CRTC asking for an investigation.

"Shaw's VoIP tax is an unfair attempt to drive up the price of competing VoIP services to protect its own high-priced service," Parent claimed, adding that Shaw charges a fee whenever Vonage customers route their calls over Shaw's internet lines.

The case is one part of a growing battle across North America between internet providers and their users.

Internet companies such as Shaw want to charge extra fees whenever people use their lines. The users naturally disagree, saying they already support the internet providers through their monthly bills.

Much of the controversy is around VoIP calls, an acronym for Voice over Internet Protocol, a system whereby telephone calls are routed through a computer internet service instead of the usual telephone system.

Long-distance calls are considerably cheaper because the user does not have to pay telephone charges.

In his announcement Tuesday, Parent said Shaw wants its high-speed internet customers to pay a $10 "quality of service enhancement" fee if they use a VoIP phone service from a provider such as Vonage Canada. He said Shaw argues that its fee is necessary to maintain the quality of independent VoIP services.

Shaw did not immediately return a telephone call to its head office in Calgary.
http://www.cbc.ca/story/business/nat...ge-060307.html





Taming ‘Over-The-Top’ Services

PCMM balances sub satisfaction, network capacity and capital
Barry Hardek

Most industry veterans acknowledge that bandwidth has long been the advantage that cable has held over competitive access technologies. Hybrid fiber/coax (HFC) networks have been modified in myriad, creative ways to expand network capacity. The continuing evolution of HFC distribution systems has allowed the cable industry to offer incremental services horizontally (more video channels and types) as well as vertically (data and voice), while maintaining some amount of overhead for future services and applications.

Cable’s unique ability to maintain the equilibrium between network capacity and bandwidth utilization is what has made this expansion not only possible, but fundable as well. HFC networks have proven to be exceedingly adaptive, but capacity always comes at a price, especially when bandwidth expansion efforts ripple across thousands of miles of physical plant, touching thousands of homes along the way.

Increasingly, the relationship between revenue, investment, and bandwidth utilization is eroding. In recent times, peer-to-peer (P2P) services (primarily audio file sharing services) have absorbed a disproportionate amount of network capacity on cable data networks with no corresponding revenue contribution. Dealing with this application put many operators in the awkward position of containing the “few” to better serve the “many,” bolstered only by the fact that much of the P2P traffic is being used to support the illegal duplication of copyrighted material.

Unlike these first-generation P2P applications, a new breed of “over-the-top” (OTT) services will put cable operators in a more contentious position. Some distinguishing characteristics of these new OTT services are as follows:

• Video as the predominant form of distributed content - Video content requires five to 50 times more bandwidth than audio files, affecting both the bandwidth and session length of each user session–both of which are critical factors in network traffic models and system design.

• Lawful content distribution - The concept of lawful content distribution is becoming increasingly complex, with subscriber-activity largely based on the adage, “Possession is nine-tenths of the law.”

• Peer-to-peer seeding schemes for video content - P2P (used by some, but not all, second-generation OTT services) stands to dramatically impact traffic modeling metrics, all of which are designed to manage “peak” utilization periods.

In theory, cable operators have the tools at their disposal in the form of node splits, advanced modulation techniques (DOCSIS 2.0), and even channel bonding (DOCSIS 3.0) to address their capacity issues for years to come. The gaps between theory and practice, however, is proving to be substantial, and the implementation of these advanced capabilities may be outpaced by evolving usage patterns and video-rich applications.

Conventional bandwidth expansion challenges

Up to now, network capacity has effectively been able to outpace utilization, with bandwidth-per-user increasing at a rate of 10 percent to 30 percent per year. But what happens as network traffic becomes increasingly video-based, resulting in user sessions that consume exponentially more bandwidth for longer durations?

Node splits–the first line of defense for expanding network capacity–can potentially cut serving area size in half, but this approach has complex network operational implications, not to mention significant construction costs and timing constraints. And evidence suggests that employing DOCSIS 2.0/advanced PHY techniques as a bandwidth expansion solution is equally unattractive. To date, no cable operator in North America has deployed DOCSIS 2.0 in a meaningful way, stemming from the complexities of intermingling different modulation schemes. Some suggest that DOCSIS 3.0 may represent a more viable solution than DOCSIS 2.0, but any next generation solution is only effective to the extent that compatible CPE is deployed in the field, and no DOCSIS 3.0 CPE devices are readily available today. As a practical matter, node splits and advanced modulation techniques have only been employed on a selective basis to solve “hot spot” problems. Network-wide upgrades that exceed the basic capabilities of DOCSIS 1.1 have not yet been justified on a risk/return basis.

To be fair, most broadband network traffic models were conceived based upon “pre- broadband” (dial up) metrics, with a heavy dose of over-provisioning added to account for the unknown. As previously indicated, P2P file sharing applications have absorbed much of the initial over-provisioned capacity that had served as the levee for network capacity. Unfortunately, over-the-top video content could represent, in aggregate, a network burden that is substantially greater than any other broadband application. As such, this new generation of OTT services can engender either unprecedented network contention or massive infrastructure costs with no offsetting increase in revenue.

Regardless of cost, broadband service providers will likely be in the position of providing the “best for the most.” One vehicle for providing such service lies within PacketCable Multimedia (PCMM) platforms, which allocate “Quality of Service” parameters such as bandwidth, latency, and jitter (video stability) for any selected application on a DOCSIS-based high speed data network. Used properly, PCMM can create a kind of flood control system that manages fair use in times of congestion, but is otherwise inactive and unobtrusive.

Implementation Guidelines
While proposed legislation and service provider sentiment certainly favors content prioritization, the actual implementation of reasonable stratification system must be fair and rationale. Our “inclusion-based” philosophy is derived from the following market generally-accepted usage data and factors:
• ~50% of peak broadband network traffic is simply surfing the web surfing, but content is increasingly becoming video-oriented and bandwidth intensive.
• ~25% of peak broadband network traffic is used for instant messaging, although the user experience is largely “elastic” --- the user experience is largely unaffected by bandwidth, delay, and latency.
• P2P traffic represents ~ 10-15% of peak network traffic, although the vast majority of these sessions are used for unlawful duplication of copyrighted material.
• Email represents 10%-15% of peak network traffic but has varying levels of elasticity depending on whether it is associated with commercial or residential users.
• Digital voice traffic, which represents a small-but-growing percentage of broadband network traffic, must be given priority to achieve appropriate levels of service.
Service Implementation

Given that network contention will likely be unavoidable in the near future, we believe that the appropriate approach for service providers is to provide the best service for most subscribers during peak times, with the flexibility to re-allocate bandwidth during less contentious intervals. In essence, certain priority traffic must be statically provisioned for QoS (such as PacketCable 1.X voice), while other priority applications (email) can be easily tagged for QoS by DPI platforms, or via other application marking technologies. A more flexible, dynamic solution is required to address the increasing amount of streaming video content that is embedded in, or linked to, most web portals.

Use Cases
Clearly, every major web portal is adding enhanced video distribution and search capabilities to their service in order to keep ahead of the burgeoning demand for media-rich content. While web surfing is considered a utility function by most consumers, the fact remains that the load placed on the broadband network --- whether the content is elastic or inelastic in nature, the broadband network is rapidly transitioning to a world of more concurrent users and longer online sessions. The challenge for cable operators going forward will be to maintain subscribers’ perceived right to certain utility services while enabling differentiated capabilities that meet the demands of applications and users. For the general surfer, adding QoS to the media- rich portal content makes optimal use of network capacity while preserving the crisp responsiveness that broadband users have come to expect.
For premium users, broadband network operators need to provide both content providers and consumers with the opportunity to accelerate the performance of their chosen application. Some content providers may chose the “pay for performance” construct promoted by several telecom executives. As a practical matter, the doctrine of fairness will likely require operators to offer QoS-enhanced capabilities beyond their own content portfolio. To complete the scenario, a manual turbo button-style burst of bandwidth can be used for any-and-all network traffic not already integrated into the PCMM back office infrastructure, giving consumers the ultimate control over the rate at which content is delivered to them.

Summary
Without question, cable operators are now facing the challenge of managing over-the- top content and, in particular, the proliferation of video-over-IP. Finding the equilibrium point between customer satisfaction, network capacity and capital investment will be a delicate balance. Fortunately, PacketCable Multimedia systems, accompanied by complementary technologies like packet inspection platforms and smart agent subsystems, will give service providers the ability to manage their strained capacity in a manner that best serves their customers.
http://www.telephonyworld.com/cgi-bi...&id=1141779314





AT&T-BellSouth Merger May Force Job Cuts
Peter Svensson

AT&T Inc. plans to cut up to 10,000 jobs, mostly through normal turnover, if its $67 billion purchase of BellSouth Corp. is approved by shareholders and regulators, AT&T's chief financial officer said Monday.

The work force reduction would take place over three years, AT&T's Rick Lindner said. Before the cuts, the combined company would have around 317,000 employees, including Cingular Wireless LLC, which is now an AT&T-BellSouth joint venture.

The new company would be the country's largest phone company - with nearly half of all lines. It also would be the largest cell-phone carrier and the largest provider of broadband Internet service.

Still, investors and analysts expect it to pass regulatory muster due to the fact that phone companies are facing increasing competition, especially from cable operators.

The acquisition, which was announced Sunday, is expected to close next year.

The 10,000 planned job cuts are in addition to the 26,000 cuts AT&T has already announced - 13,000 due to SBC's acquisition of AT&T Corp., which closed in November, and 13,000 due to shifting priorities in the business. The combined SBC-AT&T took the name AT&T Inc.

At the Communications Workers of America, which would have about 200,000 workers at the combined company, spokeswoman Candice Johnson said the merger would be a "good opportunity for job growth" as the company expands into new technologies.

"We're not looking for job losses at all," Johnson said. The union has not yet endorsed the merger.

San Antonio-based AT&T expects the acquisition to save it $2 billion annually at first, increasing to $3 billion a year by 2010.

Slightly more than one third of the savings would come from reduced labor costs and consolidation of support functions and corporate staff, Lindner said.

The combined company would be based in San Antonio, depriving Atlanta of one of its largest corporate headquarters.

Georgia Gov. Sonny Perdue and Atlanta Mayor Shirley Franklin said Monday they both will fly to Texas soon to try to persuade AT&T's executives to move their headquarters to Atlanta.

"It's hard to replace BellSouth," Franklin said. "They've contributed so much over the last decade. We're anxious for their national headquarters to move here."

Cingular's headquarters would remain in Atlanta.

More savings from the proposed acquisition would come from reduced advertising expenses and combining the companies' backbone network and information- technology operations.

"Over the last couple of years as we have operated Cingular and our Yellow Pages venture, it became clear that there was a lot of duplication that could be eliminated," said Duane Ackerman, chief executive of BellSouth.

"This merger will allow us to move to a single brand for wireline, for wireless, for business and consumer, and that's AT&T," said Randall Stephenson, AT&T's chief operating officer. "A single brand is much more cost efficient and far more effective."

Under the terms of the deal, AT&T is paying 1.325 of its own shares for each BellSouth share. AT&T shares closed Monday down 97 cents, or 3.5 percent, at $27.02 on the New York Stock Exchange.

That put the value of the offer at $35.80 per BellSouth share. Those shares rose $3.04, or 9.7 percent, to close Monday at $34.50.

The narrow difference between AT&T's offer and the market price for BellSouth shares indicated that investors believe the merger is almost certain to get through regulators.

AT&T plans to buy back stock worth at least $10 billion in the next two years, effectively paying for the premium given to BellSouth shareholders in cash, executives said.

David Kaut, a telecom regulatory analyst at the financial services firm Stifel Nicolaus & Co., said the merger would likely gain approval with modest conditions, such as the sell-off of business lines in overlapping territories.

One wild card, he said, may be Federal Communications Commission nominee Robert McDowell, a Republican who would take the open seat at the commission if approved by the Senate. McDowell is a lobbyist on behalf of the local phone carriers that compete with the Bells and could be more open to their concerns.

"We don't think he's going to go completely off the reservation and try to block" the merger, said Kaut. "He would probably try to work out some conditions that allow the deal to happen but also address competitive concerns."

Regulators are likely to buy the telephone companies' argument that other technologies will provide sufficient competition, Merrill Lynch analyst David Janazzo wrote in a research report.

Telephone companies are losing a few percent of their phone customers every year to cable, Internet and wireless telephony.

Janazzo also noted that the deal would not change the competitive landscape among cellular carriers, because Cingular is already an AT&T-BellSouth joint venture.

Justice Department officials said the proposed purchase would be reviewed by antitrust regulators, but offered no assessment of whether it was likely to generate objections.

The merger also needs approval from state regulators.

If either company calls off the merger, it may have to pay the other company $1.7 billion, according to a regulatory filing by AT&T on Monday.

The deal would substantially expand the reach of AT&T, already the country's largest telecommunications company by the number of customers served. BellSouth is the dominant local telephone provider in the Southeast.

The merged company would have 70 million local-line phone customers, 54.1 million wireless subscribers and nearly 10 million broadband subscribers in the 22 states where they now operate.
http://hosted.ap.org/dynamic/stories...MPLATE=DEFAULT





How Much Profit Is Lurking in That Cellphone?
Richard Siklos

IN some ways, wireless is the new China. Both are huge, largely untapped markets for news and entertainment media companies. And media executives have made a lot of dreamy statements about both of these markets and funneled a lot of effort into them. Yet neither has yet translated into a significant new businesses for established companies, which are feverishly seeking ways to grow in a world of technological and competitive obstacles.

While China's media moment seems eternally right around the corner, mobile may be approaching its own at last — it may just take a lot longer and be less earth-shaking than the recent hoopla may suggest. Last week, there were announcements of three ventures by media companies looking to insinuate themselves into the hip pockets of teenagers and their elders. All three are part of a deluge of wireless moves and offer glimpses at new ways of both distributing existing products and using big-media power to start new businesses.

In one of the deals unveiled last week, the MTV Networks unit of Viacom said it would sell mobile versions of its MTV, VH1, CMT and Comedy Central channels to Sprint customers; the services will include video clips from shows including "The Daily Show With Jon Stewart."

The most intriguing announcement came from a tentacle of the News Corporation, in the form of Mobizzo, which is essentially a kind of online studio and store for selling games, ring tones and adornments for mobile handsets.

CBS, meanwhile, which is perhaps best known for its notably unhip television network, plans to start a venture along the lines of Mobizzo in a few weeks. For now, CBS unveiled a plan to sell multimedia message alerts nationwide that will play short video clips on some cellphones. In a way, CBS aims to show that it wants to compete in this arena along with MTV, NBC and ESPN — rivals that have been making their content available across a range of new mobile formats and gizmos.

What is significant about the News Corporation and CBS announcements is that both companies plan to sell their new services directly to consumers. Instead of buying these services through a mobile phone carrier, users can go directly to Web sites or can send text messages to an address that will instantly sign them up for, say, a "Napoleon Dynamite" wallpaper that they can use to amuse themselves and their friends. In the case of CBS's new service, users can sign up to pay 99 cents a month for news alerts from CBS News, and $3.99 for alerts from the syndicated program "Entertainment Tonight."

For media companies, direct selling is just one advantage that mobile technologies have over other forms of distributing information and entertainment, including the Internet.

Another is that young consumers, in particular, have come to view their mobile phones as fashion accessories, giving rise to a whole new category of personal media products, such as ring tones and avatars, which are animated images of oneself that are sent to friends with messages. (If you have to ask what these are, you probably don't need one.)

A third advantage is that anything bought through a mobile phone — even if not purchased through your service provider itself — can be automatically added to your monthly phone statement, avoiding the bother of having to enter a credit card number.

Add them up and these features illustrate why mobile media could be a big deal: they turn consumption into both a fashion statement and an impulse purchase, while further letting the genie of what-I-want-when-I-want-it out of the bottle.

This has proved to be the case in other countries that have more advanced mobile networks. Much has been made, for instance, about how the United States' mobile market compares with markets in places like South Korea — where users enjoy all sorts of interactive features and pristine television signals on their handsets — and how wireless carriers here have invested some $10 billion to catch up quickly. It's only understandable that established media companies, as well as the Internet titans Google and Yahoo, want to try to capture everything from the growth of the ring tone and games markets to emerging forms of mobile advertising.

The nagging question about all the activity around mobile — the China factor, you might say — is whether the United States will embrace these new products the way other nations have.

As for the China analogy, think about this: A conventional view among American media executives is that if the Chinese government would only allow a truly progressive market for information and ideas (with attendant copyright protections), foreign media companies would flourish.

But that assumes that China has a latent entertainment consumption culture as powerful as the one that drives the United States economy, and that its citizens' tastes are very similar to those of Americans.

It is absurd that only 20 new Hollywood movies are allowed into China's theaters each year. Yet even if audiences there could legitimately go to a theater to watch "Brokeback Mountain," "Munich" and the other contenders for tonight's Academy Awards, they might not be as interested in doing so as both the censors in Beijing and the moguls in New York would like to think.

Similarly, it would be prudent to temper expectations about the prospects for wireless media in the United States — especially until it becomes clear how much people are willing to spend on these newfangled services and the fancy phones needed to use them.

CONSIDER a survey, released last week by the banking firm RBC Capital Markets, of nearly 1,000 people aged 21 to 65. When asked to respond "true" or "false" to the statement "There are many new and cool wireless products coming on the market that I am eager to purchase," 71 percent said "false." And when asked to respond to "I am not interested in watching TV programs or movies on my handheld device," 76 percent said "true."

Of course, even if this view of consumer desires proves accurate in the short term, there is plenty of business to be done selling new and cool wireless products for 20- odd percent of the 200 million cellphones currently in use nationwide.

And surveys about nascent products don't always tell the whole story. Most people probably didn't sit around thinking that they wanted to watch video clips on their computers or send instant messages to one another until these services hit critical mass.

For now, though, it seems premature to set the buzz for wireless at anything but the low setting.
http://www.nytimes.com/2006/03/05/bu...=1&oref=slogin