Peer-To-Peer News - The Week In Review - March 5th, '11 - P2P-Zone

JackSpratts · 02-03-11, 07:28 AM

Since 2002

"So, you want to be anonymous in a world that was thought up by the U.S. Department of Defense?" – Kevin

"I actually used to go on Napster and LimeWire and check to see how many people where stealing the albums. It was very flattering." – Greg Gillis

"If we’re not following you, no matter what, somebody else is. The difference in this scenario is, we show it back to you. It’s holding up a mirror to a reflection that I don’t think people knew they had." – Adam Leibsohn

"I can confirm that [the stripping and forcing of Private Manning to stand naked outside his cell] did happen, but I can’t explain it to you without violating the detainee’s privacy." – First Lt. Brian Villiard

March 5th, 2011

Judge Lets Sony Unmask Visitors to PS3-Jailbreaking Site
David Kravets

A federal magistrate is granting Sony the right to acquire the internet IP addresses of anybody who has visited PlayStation 3 hacker George Hotz’s website from January of 2009 to the present.

Thursday’s decision by Magistrate Joseph Spero to allow Sony to subpoena Hotz’s web provider (.pdf) raises a host of web-privacy concerns.

Respected for his iPhone hacks and now the PlayStation 3 jailbreak, Hotz is accused of breaching the Digital Millennium Copyright Act and other laws after he published an encryption key and software tools on his website that allow Playstation owners to gain complete control of their consoles from the firmware on up.

Sony also won subpoenas for data from YouTube and Google, as part of its lawsuit against the 21-year-old New Jersey hacker, as well as Twitter account data linked to Hotz, who goes by the handle GeoHot.

Bluehost maintains Hotz’s geohot.com site. The approved subpoena requires the company to turn over “documents reproducing all server logs, IP address logs, account information, account access records and application or registration forms” tied to Hotz’s hosting. The Bluehost subpoena also demands “any other identifying information corresponding to persons or computers who have accessed or downloaded files hosted using your service and associated” with the www.geohot.com website, including but not limited to the “geohot.com/jailbreak.zip file.”

Sony told Spero, a San Francisco magistrate, that it needed the information for at least two reasons.

One is to prove the “defendant’s distribution” of the hack. The other involves a jurisdictional argument over whether Sony must sue Hotz in his home state of New Jersey rather than in San Francisco, which Sony would prefer. Sony said the server logs would demonstrate that many of those who downloaded Hotz’s hack reside in Northern California — thus making San Francisco a proper venue for the case.

The DMCA prohibits the trafficking of so-called “circumvention devices” designed to crack copy-protection schemes. The law does not require Sony to prove that Hotz received payment for the hack, which was designed to allow PlayStation 3 owners the ability to run home-brewed software or alternative operating systems like Linux. It builds on a series of earlier jailbreaks that unlocked less protected levels of the PlayStation’s authentication process.

Jailbreaking a console is also a prerequisite to running pirated copies of games, which Sony emphasizes in its lawsuit.

“I think the these subpoenas, the information they seek, is inappropriate,” said Corynne McSherry, a staff attorney with the Electronic Frontier Foundation. In a letter to Magistrate Spero, she termed the subpoenas “overly broad.” (.pdf)

The judge also signed off on a Google subpoena seeking the logs for Hotz’s Blogger.com blog, geohotps.3.blogspot.com.

A YouTube subpoena, also approved, seeks information connected to the “geohot” account that displayed a video of the hack being used: “Jailbroken PS3 3.55 with Homebrew.” The subpoena demands data to identify who watched the video and “documents reproducing all records or usernames and IP addresses that have posted or published comments in response to the video.”

A fourth subpoena is directed at Twitter, demanding the disclosure of all of Hotz’s tweets, and “documents sufficient to identify all names, addresses, and telephone numbers associated with the Twitter account.”

Sony has threatened to sue anybody who posts the hacking tools or the encryption key. It is seeking unspecified damages from Hotz.

A hearing on whether Hotz will be tried in San Francisco or New Jersey is set for next month in San Francisco federal court.
http://www.wired.com/threatlevel/201...ite-unmasking/

European Customs Ordered to Seize PlayStation Shipments in Legal Dispute

Confiscations ordered after Asian electronics giant LG wins preliminary injunction against Sony in acrimonious patent battle
Josh Halliday

European customs officers have been ordered to seize shipments of Playstation 3s after LG won a preliminary injunction against Sony in an acrimonious patent battle between the two Asian electronics giants.

The ruling by the civil court of justice in the Hague means that all new PS3s have to be confiscated as they are imported into the UK and the rest of Europe for at least 10 days.

If the injunction was extended it could mean consoles disappearing from high street shelves. It is understood that Sony and computer games retailers typically have about two to three weeks' worth of PS3s in stock across the continent.

Tens of thousands of PS3s were seized by customs officers last week in the Netherlands, the Guardian has learnt, in a dispute that centres on Sony's allegedly infringing use of Blu-ray technology belonging to LG.

Sony, which imports around 100,000 of the consoles a week, is frantically trying to get the ban lifted. The Japanese company has the right to appeal to the European patents office.

LG meanwhile, could apply to the same patents office to get the 10-day import ban extended. Alternatively, the Korean company could apply for a court order to get the consoles destroyed but it is highly unlikely the court would grant a request to eliminate the warehoused goods.

LG argues that Sony PS3s infringe a number of its patents relating to playback of Blu-ray Discs. LG called for an investigation into the PS3's Blu-ray use in a filing with the US international trade commission earlier this month, and said it sought a "permanent exclusion order ... excluding entry into the United States" of the games console.

If Sony is found to have infringed LG patents, it could be forced to compensate the South Korean manufacturer for each PS3 it has sold around the world, which could cost hundreds of millions of pounds.

The two technology giants are involved in a complex web of seven separate patent disputes, with Sony also seeking to block shipments of LG smartphones to the US.

Rotterdam and Schiphol are the main import points for PS3s for both the UK and continental Europe. The consoles are being stockpiled in Dutch warehouses until it becomes clear how the case will develop.

A spokesman for Sony Playstation said: "We are currently looking into this matter, and cannot make any comments at this point in time." LG declined to comment, although sources close to the company confirmed the current legal position.

Sony has sold more than 3m PS3s in the UK since its launch in March 2007. The Japanese manufacturer is understood to have a stockpile of around 6,500 PS3s in Germany and 10,000 in the UK.

However, the majority of PS3 sales around Europe are pre-orders, meaning they are already sold before they gather dust at warehouses in the UK and elsewhere. Stockpiles could run out within two to three weeks if the ban is not lifted, the Guardian understands.
http://www.guardian.co.uk/technology...-legal-dispute

ISPs And Publishers Told To Work Out File-Share Plans
Eric Doyle

The government is forming a working group to address how to identify and block illegal file-sharing sites as required by the Digital Economy Act.

The group will include copyright holders, internet service providers (ISPs), search engine representatives and government ministers. The implcations of the DEA have also been also referred to Ofcom for comment and advice.

Contentious And Litigious Issues

Section 17 of the Digital Economy Act (DEA) has proved contentious because critics say efforts to combat illeagl file-sharing wiill amount to Internet censorship. Open access advocates say this could be a dangerous precedent and could be the thin end of the censorship wedge.

The intellectual rights holders, primarily comprising publishers in the music and film industry, claim they are losing untold millions of pounds from illegal downloading through file-sharing services, such as RapidShare.

The working party will consider how to make anti file-sharing measures more palatable. Search engine sites and ISPs are concerned about the burden of proof, and fear that site blocking could lead them to endless court actions from the owners of blocked sites, similar to the legal actions over users wrongly accused of downloading copyright material.

The prototype working party met last week at the request of Jeremy Hunt, the culture secretary, and Ed Vaizey, the minister for communications and creative industries. Members of the group comprised BT, Talk-Talk, Google, music rights action group the BPI, and Universal Music.

“The BPI continues to believe that measures to prevent access to illegal websites are essential if Britain’s creative and technology sectors are to fulfil their growth potential,” said Geoff Taylor, BPI’s chief executive. “Many of these websites are located outside the UK and exist solely to profit at the expense of artists and creators, threatening British jobs and investment.”

One plan under consideration is that the rights holders would take the burden and indemnify ISPs from prosecution. This could be done by presenting the ISPs with incontrovertible proof that a site is operating illegally. However, the law may have to be clarified on what is the actual definition of “illegal copying”.

Earlier this month Hunt said, “I have no problem with the principle of blocking access to websites used exclusively for facilitating illegal downloading of content but it is not clear whether the site blocking provisions in the Act could work in practice. So I have asked Ofcom to address this question.”

Google has already suggested a plan to drop piracy sites further down the search results than legal sources of films and music.

“It is agreed that what is needed is a plan B, or at least a plan that works alongside section 17 which would be the legal backstop,” one meeting attendee told The Guardian newsaper. “We want to look at how ISPs and rights holders can work together.”
http://www.eweekeurope.co.uk/news/is...ng-plans-22197

UK Hunts for 'Plan B' on Internet Piracy Proposals

Working group to search for compromise to avoid potential litigation from blocking of websites accused of illegal filesharing
Mark Sweney

A government-led working group is to be formed to try to find a "plan B" to avoid potential litigation arising from the blocking of websites accused of illegal filesharing.

The working group, which will comprise rights holders, internet service providers and search engines, is being formed after culture secretary Jeremy Hunt referred the Digital Economy Act's section 17 on website blocking to Ofcom for review. The issue of site blocking has been one of the most contentious elements of the DEA and the referral further raised the temperature of the debate, with some rights holders concerned it was a move to kick the measure into the long grass.

At a government meeting on Thursday, Hunt and Ed Vaizey, the communications and creative industries minister, held a roundtable bringing together parties including BT, Universal Music, the BPI, Google and TalkTalk to "facilitate talks" on topics including site blocking.

On the latter issue it was decided to form a working group to look at ways of making the proposed system more palatable. Following a court order obtained by rights holders, ISPs are concerned about issues including legal action from websites they block.

"It is agreed that what is needed is a plan B, or at least a plan that works alongside section 17 which would be the legal backstop," said one attendee at the meeting. "We want to look at how ISPs and rights holders can work together."

One idea is that rights holders might look to indemnify ISPs against being sued by websites that take action over being blocked in order to give confidence that they will not face large payouts. The onus would then be on the rights holders to prove incontrovertibly that a site was illegal before getting ISPs to block them.

Google, which also attended the meeting, is understood to have again mentioned plans first raised in December to police digital piracy searches and promote legal sources of film and music content.

"The nature of the internet means the creative industries, internet service providers and others such as Google and Yahoo are completely interlinked," said Vaizey earlier this week. "They need each other for sustainable future success."
http://www.guardian.co.uk/technology...bsite-blocking

Arrest Prompts Swedish Filesharing Site to Close

A well-known Swedish filesharing site has been shuttered following the arrest of a man who has since confessed to uploading more than 1,000 films to the network affiliated with the site.

On Tuesday, Swedish prosecutors issued a statement announcing the arrest of a "centrally placed person" in one of the most important filesharing networks in Sweden.

The 25-year-old man, who was active in a BitTorrent network with about 35,000 members, was arrested in a raid carried out last week, according to the Swedish Prosecution Authority (Åklagarmyndigheten).

The network is said to have focused on distributing newly released films and was included in a wider filesharing network known as "The Scene" (Scenen), an underground community of people that specialise in the illegal distribution of pirated material via the internet.

During a two-week period last autumn, the man uploaded more than 1,000 films to the network, prosecutors said.

Following his arrest, the man confessed to uploading copyrighted material. If convicted, he could face up to two years in prison.

The day preceding the prosecutors' announcement, popular Swedish filesharing site Swebits posted a message on its homepage announcing the site was closing down.

"As we all know everything has a beginning and an end. This is the end of Swebits. During the last day there has been a lot of speculation, some with hope and some with less hope," read the note posted on the Swebits homepage.

Swedbits, which was founded in 2004, had been one of Sweden's largest and longest-running BitTorrent tracker communities and specialised in sharing films and music with ties to Sweden.

While the Swebits announcement cited a lack of funding and technical problems as the cause of the shutdown, Henrik Pontén of Sweden's Anti-Piracy Bureau (Antipiratbyrån) told the Expressen newspaper there was "absolutely a connection" between the man's arrest and the closing of Swedbits.

"They became so despondent over this that they closed the operation down," he told the newspaper, adding that the man's arrest disproves the myth that BitTorrent users are impossible to trace.

According to Pontén, the arrest of the man is a major advance in Sweden's fight against illegal internet piracy.

"As far as we know, this is the first police action against an individual BitTorrent-user," he said in a statement.

"We're going to pursue several similar cases in the future and demand compensation of those who are convicted in court."

The man was originally reported by the Anti-Piracy Bureau, which provided prosecutors with the man's IP-address, according to Expressen.
http://www.thelocal.se/32348/20110302/

Teenagers Jailed for Running “Criminal Equivalent of Facebook”
Emil Protalinski

Three teenagers in the UK have been sentenced for up to five years in jail for creating and operating Gh0stMarket.net, one of the world’s largest English-language internet crime forums. The Gh0stMarket website, which had about 8,000 members, was dubbed by the court as the “criminal equivalent of Facebook”, or “Crimebook,” according to The Guardian:

Quote:

In court, Tyrone Smith, defending, said the site was a “Crimebook” where people could learn and socialize. To users, Gh0stMarket appeared as lines of computer code and broken English. On the site hackers and fraudsters traded anonymously in compromised databases containing thousands of personal details including account numbers, pins and passwords. The site contained manuals such as “14 ways of hacking credit cards” and “running cards on eBay” and information on staying anonymous. It sold hacking software and instructions on how to manufacture crystal meth and explosives.

19-year-old Nicholas Webber and 18-year-old Ryan Thomas were still at school when they were arrested after trying to pay a £1,000 ($1,600) hotel bill with a stolen card in October 2009. After finding details of 100,000 stolen credit cards on Webber’s laptop, the police uncovered the existence of the website, as well as registered losses on 65,000 bank accounts. Police estimate that the site cost credit card users as much as £16.2 million ($26.37 million). Funds were processed at an offshore bank account in Costa Rica. The two jumped bail and fled to Majorca, Spain, but were arrested again after returning to the UK early last year.

The duo managed the site, while 21-year-old Gary Kelly helped design software that broke into thousands of computers and stole valuable personal details. Webber and Thomas admitted conspiracy to commit fraud and assisting offenders, while Kelly admitted to those charges, plus conspiracy to cause unauthorized modification to computers.

Webber, who was the privately educated son of a former politician, described himself on the site as “probably the most wanted cyber criminal right now.” After his arrest, he threatened to blow up the boss of the police e-crimes unit in retaliation, and even traced officers’ addresses. His school reports described him as “lacking social skills.”

Other Gh0stMarket members received less severe verdicts by the court. 21-year-old Shakira Ricardo received an 18-month sentence after admitting conspiracy to commit fraud and acquiring criminal property. 22-year-old Ricardo and 22-year-old Samantha Worley used two Halifax bank accounts to launder money from the website. Worley was charged with acquiring criminal property and sentenced to 200 hours of unpaid work.
http://www.zdnet.com/blog/facebook/t...ebook-8221/472

Illegal TV Streamers, Here's How the Feds Will Hunt You Down
Nate Anderson

When the US government decides to take down a website offering access to free TV streams over the Internet, it doesn't mess around. Newly unsealed court documents show that Brian McCarthy, the 32-year old alleged operator of Channelsurfing.net, got the complete treatment—investigators dug into his domain name registrar, his ISP, his Gmail account, his ad brokers, and the Texas driver's license database. They even sent a surveillance team to the Deer Park, Texas home where McCarthy lived with his parents.

McCarthy had his Channelsurfing.net domain name seized on February 1 as part of the controversial "In Our Sites" investigation from Immigration and Customs Enforcement (ICE). That program seizes domain names, often of foreign websites, without an adversarial hearing; special agents simply convince a federal judge that the domain should be seized, and it is. Domains are replaced with an ICE logo and explanation that they now belong to the US government.

The government does not appear to file follow-up charges in many of these cases, content simply to seize the domains and hope the operator goes away. That's particularly true for the foreign cases, which would be hard to prosecute in any event. But when a website offers complete access to professional US football, basketball, and hockey games along with "ultimate fighting" and pro wrestling, and when the operator of that website can be found in Texas, uses US domain name registrars, US-based e-mail, and US-based money transfer (PayPal)—he's a fat target for the feds, and one who's easy to grab.

McCarthy has just been arrested for “criminal infringement of a copyright" even though his site only links to other content (that is, it doesn't host the infringing sports broadcasts itself). ICE doesn't care; McCarthy is still charged with "reproduction and distribution" over Channelsurfing.net, from which he allegedly made at least $90,000 over the last five years by framing the streamed content with his own ads.

But it's the thorough nature of the investigation that really stands out. McCarthy tried to cover his tracks, but the government's criminal complaint suggests he wasn't all that sly about it. Here's how the feds found him.

Namecheap. McCarthy registered his Channelsurfing.net domain name through a company called Namecheap. So ICE went to Namecheap and asked for the records associated with the account. Those records showed that the domain name was registered to one "Allen Allen" who listed a post office box in Deer Park, Texas. Mr. Allen's e-mail address was chevys@gmail.com.

Comcast. "Allen Allen" clearly being a pseudonym, ICE then turned to Comcast. Allen had connected to his Namecheap account from an IP address controlled by the cable giant, and Comcast turned over information to investigators showing that the IP address was linked to one David McCarthy in Deer Park.

PayPal. Namecheap's records showed that the Channelsurfing.net account had been paid from a PayPal account. The company's billing records revealed that the account in question was listed as belonging to one Brian McCarthy who used an e-mail address of chevys@gmail.com.

Public records. What was the connection between Brian and David McCarthy? Investigators searched public records and learned that Brian was David's son, and that he was 32 years old.

Gmail. The feds then went to Google, which turned over information on the Gmail account in question. Chevys@gmail.com was registered to Brian McCarthy at the same Deer Park address Comcast had revealed.

Ad networks. Investigators now had a name and address, but they also wanted to know just how much money the website had earned. They went to ad brokers ValueClick and Epic Advertising and found that the two companies had paid at least $90,000 to Brian McCarthy.

DMV. Investigators then went to the Texas Department of Motor Vehicles to find out whether McCarthy actually lived with his father; the address on Brian's drivers' license was the same one Comcast had linked to David.

Surveillance. Local investigators then got involved. They staked out the Deer Park address and confirmed that Brian “appears to reside at that address” and that his car is routinely parked there.

And with that, the feds asked a judge for on February 28 Brian McCarthy's arrest. The request was granted by a federal judge in New York City, where the investigation had taken place, and McCarthy was brought into custody. US Attorney Preet Bharara said the case show the government's willingness to "vigorously protect valuable intellectual property rights not only through domain name seizures, but also where appropriate through arrests."

McCarthy could face up to five years in prison based on the single charge he currently faces.
http://arstechnica.com/tech-policy/n...t-you-down.ars

Baidu, Taobao Named ‘Notorious Markets’ for Piracy by U.S.
Mark Drajem and Mark Lee

Baidu Inc. and Alibaba Group Holding Ltd.’s Taobao, two of China’s most-popular websites, were named “notorious markets” by the U.S. Trade Representative for helping sustain piracy and counterfeiting.

China’s biggest Internet search engine and biggest online retailer, respectively, were among more than 30 Internet and physical markets worldwide identified by the USTR for helping the illegal sale of goods or materials protected by copyright or patents. The list included the Pirate Bay file-sharing website in Sweden and the Silk Market in Beijing, according to the statement.

The U.S. agency called on regulators overseeing the markets on the list to pursue possible legal action and step up efforts to combat the violations. The spread of global piracy and counterfeiting hurts entrepreneurs and industries worldwide, said Ron Kirk, the trade representative.

“There’s always some concern on investors’ minds about fraud,” said Aaron Kessler, an analyst at ThinkEquity LLC in San Francisco. “That’s existed in China to a larger degree than with U.S. companies.”

Zhao Xianquan, a spokesman at China’s Ministry of Commerce, said he couldn’t immediately comment on the U.S. report.

‘Deep Linking’

Baidu, China’s most-visited website, provides “deep linking” to items being sold on sites without the copyright holders’ permission, according to the statement.

Taobao has a “long way to go” to stamp out the availability of infringing goods on its website, though the company is making “significant efforts” to resolve the problem, the USTR said.

“We appreciate the USTR’s acknowledgment of our ongoing efforts to work with brand owners in protecting their intellectual property rights,” John Spelich, a Hong Kong-based spokesman at Alibaba, said in an e-mail. “We will continue to work closely with brand owners and others to further enhance the level of trust and integrity in our online marketplaces.”

Kaiser Kuo, a spokesman at Baidu in Beijing, declined to comment.

Other websites listed by the USTR include torrentz.com; ThePirateBay, which has been the target of “notable criminal prosecution” in Sweden; 91.com; and Rutracker, based in Russia.

“The United States urges the responsible authorities to intensify efforts to combat piracy and counterfeiting in these and similar markets, and to use the information contained in the Notorious Markets List to pursue legal action,” according to the U.S. report.

The report named 17 physical markets, including the Silk Market in Beijing, which it called a “particularly prominent example of the counterfeiting of commercial and industrial products that is endemic in many retail and wholesale markets throughout China.”

--With assistance from Joseph Galante in San Francisco. Editors: Young-Sam Cho, Anand Krishnamoorthy.
http://www.businessweek.com/news/201...y-by-u-s-.html

Word on the Web: Learn to Stop Worrying and Love Digital Pirates
Joshua Philipp

Digital piracy has gained a name of infamy as companies set out to crush a practice that is unloading everything from music to software without paying a dime. Still, while the conventional notion is to fight the practice tooth and nail, some of the most successful cases are those who have embraced it.

Among the success stories is that of “Minecraft,” the legendary game developed by one man that has sold more than a million copies before it has even reached its final release.

Markus Alexej Persson, better known as Notch, is the man behind “Minecraft.” Although he sells each copy of the game for around 15 euros, part of his business model is the word-of-mouth promotion of piracy.

His stance is that if someone pirates “Minecraft” rather than buy it, what he loses is “potential” revenue. “But what if that person likes that game, talks about it to his or her friends, and then I manage to convince three of them to buy the game? I’d make three actual sales instead of blocking out the potentially missed sale of the original person which never cost me any money in the first case,” Notch wrote in his personal blog.

He has, however, taken a method to combat piracy—offering Web-based services that only paying customers can have access to.

“None of these features can be accessed by people with pirated versions of the game, and hopefully they can be features that turn pirates from thieves into potential customers,” Notch writes.

The approach Notch takes of offering Web-only services to coax pirates into buying the full software is becoming more common.

Blizzard, makers of the long-awaited “Starcraft II” video game were able to sell more than 3 million copies in the first month of its release.

Although Blizzard does not encourage piracy, the main lure of “Starcraft II” is its online play that’s only available through its own servers. If pirates want to play with other users online, they need to go out and buy the game.

Daniel Jalkut, founder of Red Sweater Software, and creator of the MarsEdit blogging application, holds the belief that pirates will become customers, which he outlines in his business blog.

Although he states, “The last thing I want to do is legitimize piracy,” he goes on that “A pirating user is better than no user at all,” and brings hard-earned benefits to a product: word-of-mouth marketing, peer-provided support, and market saturation.

He believes that pirates will eventually become customers. He said, “My impression is that theft in general is an immature act,” and that once people mature, “they’re going to need software. The fact that they’ve been using your product illegally for years will probably make it among the first that they legitimately pay for.”

French DJ David Guetta, who topped the charts with his “One Love” album in 2009 has taken the approach a step further.

His album sold more than 15 million singles around the world, yet he states, “I have never been very nervous about online piracy,” Guetta told U.K. media Daily Star.

“Sometimes you have to give away content, even if it isn’t bringing you money,” Guetta said.

Give to Sell

The approach to sell by giving—even if not willingly—isn’t unknown. The benefits were outlined in a Cato Institute report written in 2002 when record companies shut down Napster—a case that heralded the war against peer-to-peer file sharing.

The Cato Institute referred to the “exposure effect,” a bi-product of piracy that it described as “a form of advertising or sampling that could ultimately lead to larger sales of legitimate versions.”

“Users of pirated software, for example, might find themselves wanting the manuals and technical support that would be available only to authorized users. Or, as claimed in the Napster defense, Napster users may just sample songs to get a better idea of which CDs to buy,” states the report.

It adds that the “network effect” could also be a positive side to piracy. “A more recent claim is that copying may benefit copyright holders when network effects are strong,” states the report, adding, “An example of network effects for products prone to piracy might be word processing software that becomes more valuable the more individuals are using the same software.”

Spotify, a European music service, is among the larger examples of this. The service bypasses piracy altogether by allowing users to listen to and share songs by any artist they want for free—legally.

Although the service is still barred from the U.S., it is a hit in Europe with more than 10 million in seven countries, with 500,000 users who have signed on to its paid services that can eliminate ads or let users store as many songs as they want on their devices, Wired magazine reported.

Meanwhile, record sales are rising through most area where the service is available, contrary to the fears of record labels.

Spotify CEO Daniel Ek has a simple philosophy of why this is. “People now consume a lot more music by a bigger diversity of artists,” Wired reported. “And the reason they do that is because they no longer discover music from a radio station. They discover music from their friends.”

While piracy is estimated to cost the U.S. economy $58 billion each year in lost revenue, according to a 2007 study by the Institute for Policy Innovation, there is data that suggests otherwise—particularly with box office sales.

Global box office sales hit an all time high in 2010, reaching $31.8 billion and outdoing the previous year by eight percent. This includes $10.6 billion from the U.S. and Canada, which stayed at the same level as 2009, according to a Feb. 23 Motion Picture Association of America press release. The same phenomenon has taken place year after year.

“Despite a weak economy, shifting business models, and the ongoing impact of digital theft, we had another record year at the global box office driven by growth outside the U.S. and Canada,” said Bob Pisano, President and Interim CEO of the MPAA, in a press release.
http://www.theepochtimes.com/n2/tech...tes-52086.html

The ‘True Price of File Sharing’
Jon Newton

Without access to P2P downloading, “75% of downloaders would purchase music through a combination of CD and digital retail sites”, states George Barker, categorically.

That’s according to The True Price of Peer to Peer File-Sharing, a Canadian Intellectual Property Council (CIPC) ‘report‘ prepared with the help of Baker, director for the Centre for Law and Economics at the Australian National University, and released by Vivendi Universal, EMI, Warner Music and Sony Music’s IFPI.

With the Big 4 in the wings, the huff’n'puff piece “takes a closer look at survey data gathered by Industry Canada between 2005 and 2008″, says the CIPC, an ‘affiliate’ of the Canadian Chamber of Commerce which paid for it.nd which boasts it’s a “strong supporter of ACTA“.

The survey data used for the study were “published first in 2007 and later in 2010 with different results at the time of each publication”, admits the CIPC, without stating what the different results revealed.

Nonetheless, “This is good news for members of Parliament as they review Bill C-32, The Copyright Modernization Act,” says the CIPC’s Bob Weese.

“This research proves that efforts to target large scale infringers of copyrighted material through copyright reform will, in fact, produce positive results for the Canadian economy and the cultural sector, in particular.”

It does not, of course, prove anything at all.

No need to stay tuned.
http://www.p2pnet.net/story/49494

70% of the Public Finds Piracy Socially Acceptable
enigmax

A recent study on moral standards and whether some law breaking is socially acceptable has revealed an interesting stance on file-sharing among the public. Of those questioned in the study, 70% said that downloading illicit material from the Internet is acceptable. Three out four, however, felt it was completely unacceptable to then sell that product for profit.

During the last decade the entertainment industries have tried numerous strategies to thwart Internet piracy. One of the most common, especially with the music industry, was to sue some file-sharers into submission thereby creating a climate of fear designed to deter others. Needless to say, that didn’t work particularly well.

The movie industry has largely concentrated their legal efforts largely on taking sites down but have also been active in trying to educate Internet users through various schemes that piracy is ‘wrong’ and causes real damage. On the whole, that hasn’t worked either, and a new study just released appears to back up the assertion.

The study, published by the Rockwool Foundation Research Unit, questioned participants on morals and ethics, and included discussion on which laws they believe are socially acceptable to break.

The Danish study, which ultimately concluded that moral standards are just as high as they were 10 years ago, covered issues such as tax evasion, insurance fraud, the morality gap between men and women and, to the interest of TorrentFreak readers, piracy.
In the piracy section respondents were asked to rate, on a scale from 1 to 10, whether they thought unauthorized downloading for personal use is a socially acceptable act. The researchers found that 7 out of 10 of those questioned felt, to a greater or lesser degree, that it is socially acceptable. 15-20% of the total group believed that piracy is totally acceptable.

A minority of just over 30% of the respondents voted at the very bottom of the response scale, an indication that they feel piracy is completely unacceptable.

Interestingly, despite the never-ending anti-piracy campaigns of the last decade, the attitudes of the public don’t seem to have changed much. When questioned for a 1997 study on whether it was acceptable to use pirate software, the same proportion – 3 out of 10 – said the activity was unacceptable.

However, in the new 2010 study, there is an interesting common moral denominator among respondents. When questioned on whether it is acceptable to download something and then sell it to a friend for profit, 3 out of 4 said that would be completely unacceptable.

The results of the study show that it is nearly impossible for copyright holders and anti-piracy groups to change the attitudes of the public in their favor. If they want piracy to decrease, their best bet is probably to focus on lowering the incentives for people to pirate, there seems to be more opportunities in that area.

The study can be found here (.pdf) in Danish.
http://torrentfreak.com/piracy-socia...ptable-110228/

Illegal Filesharing 'Fills the Gaps in Market'
Hannah James

Illegal filesharing sites, also known as P2P [peer-to-peer] sites, respond to internet users' need [NEEDS] in the market place, a space that so far legal entities have refused to fill, according to Jared Moya, chief editor of technology portal Zeropaid.

"The truth about online piracy is that it is simply filling the gaps in the marketplace that copyright holders refuse to fill," he said.

The expert highlighted the lack of a serious, legal company that provides a similar service to the one P2P sites give. He also said the legal copyright holders don't even think of it as a choice to give consumers.

His comments emerged as a survey by Envisional reveales [REVEALS] 23.8 per cent of the planet's online traffic was formed by copyrighted work transmitted and shared illegally, most of it consisting of video material, as reported by the Washington Post earlier this month.

Experts have said that the US is an example of how the availability of legal material has diminished the need to share files illegally.
http://www.computeach.co.uk/IT-news/...rket/800437155

LimeWire Says Studios Profit from File Sharing
Adam Klasfeld

LimeWire, a file-sharing software company shut down by a copyright lawsuit from major studios, told a federal judge that discovery conducted to determine damages shows that file-sharing benefited the music industry, even though the studios tried to "blacklist" LimeWire from doing business with other digital music businesses.

U.S. District Judge Kimba Wood recently affirmed a magistrate judge's court order for the studios to produce more documents that LimeWire believes will support its position.

On May 11, 2010, a Federal Court granted summary judgment to more than a dozen studios, led by Arista Records, entitling them to damages for secondary copyright infringement.

U.S. Magistrate Judge Debra Freeman compelled discovery for damages.

According to Wood's Feb. 28 decision, the studios "collected multiple terabytes of data from the emails of forty-three custodians of documents, reviewed hundreds of thousand of documents, and produced over a quarter of a million pages of email communications on the subject of licensing or distributing content."

LimeWire asked Freeman to expand her original order, claiming the order "indicated (1) that Plaintiffs were attempting to 'blacklist' LimeWire; (2) that certain employees of Plaintiffs had expressed a desire to work with LimeWire; and (3) that Plaintiffs believed that user downloads through LimeWire had actually increased Plaintiffs' revenue," according to Judge Wood's Feb. 28 Opinion and Order.

The studios defied a Jan. 18 court order in which Judge Freeman expanded discovery, claiming that turning over the requested files would breach attorney-client privilege, Judge Wood wrote.

In her Feb. 28 ruling, Wood affirmed Freeman's order, limiting discovery to documents that were not protected by attorney-client privilege.

Wood wrote that the studios did not need to provide documents that tended to prove blacklisting against LimeWire, saying it was "reasonable and appropriate" for studios to "minimize their exposure to copyright infringement."

Wood ordered the studios to produce only internal documents, arguing "third-party research may not contain Plaintiffs' own analysis and internal information regarding the impact of the LimeWire shutdown on their revenues."

On Monday, Wood signed an order reversing Freeman's order compelling nonparties MySpace, iMesh, and Yahoo! to comply with discovery for external communications.

A trial for damages will be held on for May 2.
http://www.courthousenews.com/2011/03/03/34623.htm

Canadian Songwriters Propose $10 Fee for Music-Sharing
Vito Pilieci

Canadian songwriters are again targeting Internet file-sharing, this time with a proposal for consumer licences that could add as much as $10 to monthly Internet bills.

It would allow holders to download as much music as they wanted without fear of legal reprisal.

Eddie Schwartz, president of the Songwriters Association of Canada, said the group has already approached several Internet service providers — the private firms that would collect the fees on behalf of copyright collectives — and hopes to begin trial runs of the licences by the end of the year.

Schwartz would not say which Internet providers he is in talks with.

Buying a licence would allow Canadians to download as much music as they wanted during the month using free peer-to-peer file-sharing services, marking a huge change over buying albums or songs individually from services such as iTunes.

The licence fees could net songwriters as much as $840 million annually if every Internet subscriber took out a licence, the group said.

The group failed in a 2007 bid for a Canadian Copyright Act amendment that would have forced service providers to pay a tax in exchange for music downloading and file-sharing by customers. This time, however, it believes it can bypass Parliament.

"All of the rights that we need are actually already in Canada's copyright laws," said Schwartz. "We thought, 'all we need to do is come up with a private business model that monetizes file-sharing.' That's what we set out to do, modify the (original) proposal so that there was a private way to achieve the same results without needing to get legislation."

Among collectives that would receive the fees is the Society of Composers, Artists and Music Publishers of Canada (SOCAN), a group largely controlled by songwriters association members.

SOCAN already issues licences to businesses and organizations that want to play music in public places. The money is distributed to composers, lyricists and songwriters.

Licences are even required for dental offices and beauty salons that have a radio playing for patrons, and several businesses have faced fines for failing to pay for a permit.

David Fewer, an intellectual property and technology lawyer and director of the Canadian Internet Policy and Public Interest Clinic at the University of Ottawa, agreed that most of the mechanisms needed to enact such a fee for consumers are already in place.

He warned, however, that the plan could upend the Canadian music industry. While the songwriters would get paid from the fees, other players, such as record labels, would not.

"SOCAN has certain rights to do it," Fewer said. "But, the real problem is that SOCAN only represents songwriters. We are getting into the complicated way that music works."

The Canadian Recording Industry Association, which represents major record labels in Canada, said it had not been contacted about the plan.

Graham Henderson, president of the association, said services such as Rdio.com and Slacker Radio already allow people to listen to as much music as they want for about $5 a month. As well, he said, these services are virus-free. Many online-sharing sites are infected with computer viruses.

"We need to look at what the market has to offer and give it a chance. That way, we might actually get somewhere," said Henderson. "We need to promote these legal services. People don't even know these services exist."

The 2007 call for a tax on Internet service providers met strong opposition from consumer groups and the ISPs themselves. Schwartz said that pushed his group to find another way to compensate artists for lost royalties.

"There are so many interests and parties lobbying around copyright reform. It's an extremely complicated process. Legislation that appeals to all of the different interests is very difficult to get," he said.

"We aren't entirely sure that anybody other than those people who are directly involved really understand all of the nuances. Without monetizing what happens on the Internet, which is mostly file-sharing, it is going to be very hard for anybody (in music) to make a living."

The proposal seems certain to alarm an Internet customer base already angry about usage-based billing charges — especially when they learn the songwriter group wants the fees to be billed automatically, with subscribers who didn't want licences forced to notify SAC and agree they would not engage in online music file-sharing.

Such a plan, however, would be difficult to implement in Ontario and other provinces with strong consumer laws against opt-out or "negative" billing.

Schwartz said he believes offering the private music-sharing licences can bolster SAC'S legal position and better allow it to chase abusers with lawsuits, similar to those filed against consumers in the United States.

"The surest and swiftest way to dramatically reduce infringement is to give consumers an authorized way to music-file share. Once such an authorized system is in place, consumers who refuse to pay a reasonable licence fee will clearly be choosing to infringe and can be dealt with accordingly," reads Schwartz's proposal.

Schwartz argued that more than 97 per cent of the music obtained over the Internet is done so illegally through file-sharing activities. His statistics come from a controversial 2010 report by the International Federation of the Phonographic Industry. He also quoted recent studies that suggest as many as 80 per cent of all file-sharers say they would pay a monthly fee to legitimize their file-swapping and prevent them from getting sued.

The initiative is likely also to raise eyebrows in other industries hurt by the digital revolution.

The TV, movie and publishing industries have all struggled as their content has been devalued and shared among Internet users. Adding a fee or levy to Internet bills could be a way for those industries to shore up their bottom lines as well.
http://www.vancouversun.com/entertai...146/story.html

The Gaiman Principle: “Piracy” is Advertising (and Why Ramen Music Encourages Sharing)
Sudara

In one of my favorite videos from recent weeks, author Neal Gaiman explains how he was initially paranoid and “really grumpy with people” when they put up his poems and stories on the web. After some time, he realized that the “places where I was being pirated, I was selling more and more books, people were discovering me.”

Why should a musician or author allow their work to be copied and shared without freaking out over potential losses? Gaiman explains:

“I started asking audiences to just raise their hands for one question, which is I say: “Ok, do you have a favorite author?” And they say “Yes.” And I say “Good, what I want is for everybody who discovered their favorite author by being lent a book, put up your hands. And anybody who discovered your favorite author by walking into a bookstore and buying a book, raise your hands.”

The response?

“Very few of them bought the book. They were lent it. They were given it. They did not pay for it.”

The Gaiman Principle

I have started to refer to this phenomenon as “The Gaiman Principle”:

In Gaiman’s words:

“Nobody who would have bought your book is not buying it because they can find it for free. What you are actually doing is advertising, you are reaching more people.”

In other words: Piracy is advertising.

The underlying assumptions:

1) Creative work has value.
2) People want to spend money on art they love and enjoy.
3) People need to find the creative work that they value
4) Trusted recommendations are the best path to discovery.
5) The only thing stronger than a trusted recommendation is a trusted recommendation combined with actually experiencing the creative work. This is the royal flush of recommendations. As a producer of creative work, it’s what you should be dreaming of.

The Ultimate Recommendation

The biggest thing the web has done for creatives is to not only allow personal recommendation to be quickly broadcast, but the actual work that is being recommended can often also be broadcast.

Let’s say you tell a friend you love a song. It is a strong personal recommendation. If you tell them you love it and also give them the song so they can hear it, perhaps they become hooked on it, and celebrate it’s awesomeness with you - that’s the power that sharing (or piracy) provides.

To reject this opportunity and instead focus on what the artist might be losing in this recommendation process is a tangental, fear-based waste of time at best. It completely disregards the fact that by sharing the music/writing/etc, a fan is essentially marketing on the creator’s behalf. The person he or she is marketing to - they probably hadn’t checked you out before. They were not an existing fan, reading to spend money. Now they have heard of you, and tasted your work, and possibly acquired a taste for your work. The fan sharing the creative work should be thanked.

Sharing online (or piracy) is not something for authors or musicians to fear, to blame when they don’t sell well, to use as a scapegoat for not having been profitable, etc. It sure is tempting to think that way if things aren’t going well. But don’t. If you are being pirated, you are doing it right.

Just remember the Gaiman Princible: When people are sharing your work, it is advertising, even though the work itself has monetary value. It’s the highest form of personal recommendation available. Embrace it.

Ramen Music: Built on the Gaiman Principle

Ramen Music was built from the start to encourage sharing. Our issues have value. I work my butt off producing them. The dozen or so artists per issue worked hard on those songs. Ramen Music pays these artists for their hard work. And our paid subscribers are how we survive.

But people want to share things they love. Why would we get in the way of that? Our subscribers bought our music. They are people that value what we do. Should we be telling them not to give the ultimate recommendation to a friend?

What about potential new subscribers? They are human like you and me. They probably want to check something out, listen and play with something before spending money. I do. So lets make that easier to do that. Not slam a gate in front of them and expect them to still be interested.

So, we made Ramen Music issues easily shareable. We even remind our subscribers that they can and should share them. We have daily proof that this works. People on twitter or facebook recommend us to their friends and followers and include a link to a full, non-crippled, high quality issue. Even just a few minutes later, new subscriptions from friends come in. And we lose nothing.

So artists and labels: Please don’t make the mistake of thinking that the world is black and white and filled with evil pirates stealing your wares. It’s more complex and positive and wonderful than that. If your music is being shared and pirated, celebrate! The word is spreading to people who don’t yet know the value of your work. Let it spread. For the love of god, let it spread.
http://blog.ramenmusic.com/post/3620...tising-and-why

Darrell Issa Tells IP Czar That She's 'Not Trying' If She Can't Pin Liability For File Sharing On Third Parties
Mike Masnick

Not much in the way of details but Thomas O'Toole reports (via Twitter) that Rep. Darrell Issa, who last fall had indicated he was worried that overly draconian copyright laws might stifle innovation, is now apparently pushing for even more draconian copyright laws. He apparently told IP Czar Victoria Espinel that she's "not trying" if she can't figure out a way to prosecute credit card companies who process transactions for "pirate" sites. It's kind of funny that Rep. Issa would say he's worried about stifling innovation... but then pushes for third party liability rules and prosecutions that would absolutely stifle innovation.

If he really wants the government to go after credit card companies with criminal lawsuits for the actions of some of their customers, that's simply going to lead those companies (and others) to be a lot stricter in terms of whom they work with. It could prevent plenty of perfectly legitimate companies from being able to offer transactions, because the credit card companies don't want to take the risk that one of those sites might just possibly be labeled an infringer. The chilling effects here would be massive. We have the safe harbors for third parties in the DMCA and the CDA for a damn good reason: because we should place liability on parties actually responsible, not on third parties who will then react by clamping down and denying important services to perfectly legitimate sites.
http://www.techdirt.com/articles/201...-parties.shtml

Senate Votes to Strip Down Patent Reform Bill
Diane Bartz

The Senate voted on Tuesday to strip controversial provisions out of a bipartisan bill to revamp the U.S. patent system and clear a years long backlog of patent applications.

The vote was 97 in favor and two opposed.

Senators Patrick Leahy, Charles Grassley and Jon Kyl, members of the Senate Judiciary Committee, proposed stripping from the bill a measure that gives judges a major role in determining how important a particular patent is to a product, so that infringing minor patents would not lead to huge damages.

They also took out a provision barring the practice of maneuvering to file patent infringement lawsuits in courts known to be friendly to plaintiffs.

On both issues, the U.S. Court of Appeals for the Federal Circuit, which specializes in patent appeals, has issued rulings that go a long way toward ending the problem of juries in plaintiff-friendly districts giving out-sized damage awards.

Leahy and other of the bill's supporters are hoping for a vote on the bill this week. There is as of yet no companion bill in the U.S. House of Representatives, but reform advocates expect the eventual House measure will be similar to the Senate bill.

Representative Lamar Smith, chairman of the House Judiciary Committee, said in a statement he was "close to completing the draft of the House patent reform bill."

The amendment also would end the practice of diverting money from the U.S. Patent and Trademark Office. The patent office sometimes brings in considerably more money in fees than is allowed in its budget, angering companies that wait years to get a patent approved due to a shortage of patent examiners.

The White House said late on Monday it supported the bill, with or without the damages and venue provisions.

The Obama administration said it supported moving to a first-to-file system, which is in the bill. Under this system, the patent application sent first to the patent office is approved instead of requiring inventors to show they were the first to develop a certain technology or drug.

This change would make the patent application process easier for companies that apply for patents in multiple countries.

Other provisions in the bill aim to prevent bad patents from being issued by allowing third parties to provide information on why an application should be rejected. The bill also set rules for allowing patents to be challenged after they are granted, which proponents say is cheaper than litigation

The bill also called for allowing the patent office to set its own fees so it can hire more examiners and upgrade technology so examiners can chip away at a massive backlog of patent applications.

David Kappos, the head of the patent office and a former International Business Machines Corp vice president, addressed criticism of the bill from the high technology sector, which initially pushed for a patent reform and now largely opposes it.

"As a person who came from the information technology industry ... there are actually lots of good things for the tech industry (in the bill)," Kappos told reporters.

Leahy's amendment would also create a temporary, limited proceeding at the USPTO to challenge business-method patents. Perhaps the most familiar example is Amazon.com Inc one-click purchase patent.

The Supreme Court last year rejected a way to hedge energy costs, but did not shut the door on business method patents.

(Editing by Andre Grenon)
http://www.reuters.com/article/2011/...7207S620110301

Armies of Expensive Lawyers, Replaced by Cheaper Software
John Markoff

When five television studios became entangled in a Justice Department antitrust lawsuit against CBS, the cost was immense. As part of the obscure task of “discovery” — providing documents relevant to a lawsuit — the studios examined six million documents at a cost of more than $2.2 million, much of it to pay for a platoon of lawyers and paralegals who worked for months at high hourly rates.

But that was in 1978. Now, thanks to advances in artificial intelligence, “e-discovery” software can analyze documents in a fraction of the time for a fraction of the cost. In January, for example, Blackstone Discovery of Palo Alto, Calif., helped analyze 1.5 million documents for less than $100,000.

Some programs go beyond just finding documents with relevant terms at computer speeds. They can extract relevant concepts — like documents relevant to social protest in the Middle East — even in the absence of specific terms, and deduce patterns of behavior that would have eluded lawyers examining millions of documents.

“From a legal staffing viewpoint, it means that a lot of people who used to be allocated to conduct document review are no longer able to be billed out,” said Bill Herr, who as a lawyer at a major chemical company used to muster auditoriums of lawyers to read documents for weeks on end. “People get bored, people get headaches. Computers don’t.”

Computers are getting better at mimicking human reasoning — as viewers of “Jeopardy!” found out when they saw Watson beat its human opponents — and they are claiming work once done by people in high-paying professions. The number of computer chip designers, for example, has largely stagnated because powerful software programs replace the work once done by legions of logic designers and draftsmen.

Software is also making its way into tasks that were the exclusive province of human decision makers, like loan and mortgage officers and tax accountants.

These new forms of automation have renewed the debate over the economic consequences of technological progress.

David H. Autor, an economics professor at the Massachusetts Institute of Technology, says the United States economy is being “hollowed out.” New jobs, he says, are coming at the bottom of the economic pyramid, jobs in the middle are being lost to automation and outsourcing, and now job growth at the top is slowing because of automation.

“There is no reason to think that technology creates unemployment,” Professor Autor said. “Over the long run we find things for people to do. The harder question is, does changing technology always lead to better jobs? The answer is no.”

Automation of higher-level jobs is accelerating because of progress in computer science and linguistics. Only recently have researchers been able to test and refine algorithms on vast data samples, including a huge trove of e-mail from the Enron Corporation.

“The economic impact will be huge,” said Tom Mitchell, chairman of the machine learning department at Carnegie Mellon University in Pittsburgh. “We’re at the beginning of a 10-year period where we’re going to transition from computers that can’t understand language to a point where computers can understand quite a bit about language.”

Nowhere are these advances clearer than in the legal world.

E-discovery technologies generally fall into two broad categories that can be described as “linguistic” and “sociological.”

The most basic linguistic approach uses specific search words to find and sort relevant documents. More advanced programs filter documents through a large web of word and phrase definitions. A user who types “dog” will also find documents that mention “man’s best friend” and even the notion of a “walk.”

The sociological approach adds an inferential layer of analysis, mimicking the deductive powers of a human Sherlock Holmes. Engineers and linguists at Cataphora, an information-sifting company based in Silicon Valley, have their software mine documents for the activities and interactions of people — who did what when, and who talks to whom. The software seeks to visualize chains of events. It identifies discussions that might have taken place across e-mail, instant messages and telephone calls.

Then the computer pounces, so to speak, capturing “digital anomalies” that white-collar criminals often create in trying to hide their activities.

For example, it finds “call me” moments — those incidents when an employee decides to hide a particular action by having a private conversation. This usually involves switching media, perhaps from an e-mail conversation to instant messaging, telephone or even a face-to-face encounter.

“It doesn’t use keywords at all,” said Elizabeth Charnock, Cataphora’s founder. “But it’s a means of showing who leaked information, who’s influential in the organization or when a sensitive document like an S.E.C. filing is being edited an unusual number of times, or an unusual number of ways, by an unusual type or number of people.”

The Cataphora software can also recognize the sentiment in an e-mail message — whether a person is positive or negative, or what the company calls “loud talking” — unusual emphasis that might give hints that a document is about a stressful situation. The software can also detect subtle changes in the style of an e-mail communication.

A shift in an author’s e-mail style, from breezy to unusually formal, can raise a red flag about illegal activity.

“You tend to split a lot fewer infinitives when you think the F.B.I. might be reading your mail,” said Steve Roberts, Cataphora’s chief technology officer.

Another e-discovery company in Silicon Valley, Clearwell, has developed software that analyzes documents to find concepts rather than specific keywords, shortening the time required to locate relevant material in litigation.

Last year, Clearwell software was used by the law firm DLA Piper to search through a half-million documents under a court-imposed deadline of one week. Clearwell’s software analyzed and sorted 570,000 documents (each document can be many pages) in two days. The law firm used just one more day to identify 3,070 documents that were relevant to the court-ordered discovery motion.

Clearwell’s software uses language analysis and a visual way of representing general concepts found in documents to make it possible for a single lawyer to do work that might have once required hundreds.

“The catch here is information overload,” said Aaref A. Hilaly, Clearwell’s chief executive. “How do you zoom in to just the specific set of documents or facts that are relevant to the specific question? It’s not about search; it’s about sifting, and that’s what e-discovery software enables.”

For Neil Fraser, a lawyer at Milberg, a law firm based in New York, the Cataphora software provides a way to better understand the internal workings of corporations he sues, particularly when the real decision makers may be hidden from view.

He says the software allows him to find the ex-Pfc. Wintergreens in an organization — a reference to a lowly character in the novel “Catch-22” who wielded great power because he distributed mail to generals and was able to withhold it or dispatch it as he saw fit.

Such tools owe a debt to an unlikely, though appropriate, source: the electronic mail database known as the Enron Corpus.

In October 2003, Andrew McCallum, a computer scientist at the University of Massachusetts, Amherst, read that the federal government had a collection of more than five million messages from the prosecution of Enron.

He bought a copy of the database for $10,000 and made it freely available to academic and corporate researchers. Since then, it has become the foundation of a wealth of new science — and its value has endured, since privacy constraints usually keep large collections of e-mail out of reach. “It’s made a massive difference in the research community,” Dr. McCallum said.

The Enron Corpus has led to a better understanding of how language is used and how social networks function, and it has improved efforts to uncover social groups based on e-mail communication.

Now artificial intelligence software has taken a seat at the negotiating table.

Two months ago, Autonomy, an e-discovery company based in Britain, worked with defense lawyers in a lawsuit brought against a large oil and gas company. The plaintiffs showed up during a pretrial negotiation with a list of words intended to be used to help select documents for use in the lawsuit.

“The plaintiffs asked for 500 keywords to search on,” said Mike Sullivan, chief executive of Autonomy Protect, the company’s e-discovery division.

In response, he said, the defense lawyers used those words to analyze their own documents during the negotiations, and those results helped them bargain more effectively, Mr. Sullivan said.

Some specialists acknowledge that the technology has limits. “The documents that the process kicks out still have to be read by someone,” said Herbert L. Roitblat of OrcaTec, a consulting firm in Altanta.

Quantifying the employment impact of these new technologies is difficult. Mike Lynch, the founder of Autonomy, is convinced that “legal is a sector that will likely employ fewer, not more, people in the U.S. in the future.” He estimated that the shift from manual document discovery to e-discovery would lead to a manpower reduction in which one lawyer would suffice for work that once required 500 and that the newest generation of software, which can detect duplicates and find clusters of important documents on a particular topic, could cut the head count by another 50 percent.

The computers seem to be good at their new jobs. Mr. Herr, the former chemical company lawyer, used e-discovery software to reanalyze work his company’s lawyers did in the 1980s and ’90s. His human colleagues had been only 60 percent accurate, he found.

“Think about how much money had been spent to be slightly better than a coin toss,” he said.
https://www.nytimes.com/2011/03/05/science/05legal.html

Steve Jobs' Reality Distortion Takes its Toll On Truth
Seth Weintraub

Apple twisted facts (or worse) to try to convince crowds that all other tablets had no shot at de-throning the iPad in 2011.

In what seems like a ritual at this point, I watched Apple's iPad 2 keynote in disbelief, noting the factual errors that kept coming up minute after minute.

So, let's get started: As part of the opening iPad bullet points, Apple included this gem:

"First dual core tablet to ship in volume." That's funny, I tested a Dell (DELL) Streak 7, which had a dual core Nvidia Tegra 2 chip in January. They've been shipping ever since on T-Mobile.

In volume.

Of course, the Motorola (MMI) XOOM also has this same dual core processor and is certainly shipping in volume as well. In fact, I've been using an Android phone (the Atrix) with a dual core chip for weeks and it wasn't the first to ship in volume. As for Apple (AAPL), they haven't shipped one iPad 2 yet -- iPad 2's hit shelves on March 11.

Perhaps this has to do with Jobs' subjective view of 'Volume' which may start at whatever numbers iPads are currently selling? And 'ship'? Well, I don't know.

That was just the beginning. He next pulled out a thoroughly debunked, mis-translated quote from a Samsung VP:

Some people only hear what they want to hear, but that quote should have ended with "quite smooth." That translation was officially corrected a long time ago. Shame on Apple Keynote fact-checkers, if such a role even exists.

That leads us to:

">90% market share". OMG Math.

Both Apple and Samsung measure sales the same way -- into the channel. Apple has just as many points of sale for the iPad as Samsung has for the Tab and likely many more. So Samsung sold 2 million (in the last quarter) in 2010. Apple sold 14.8 million (in three quarters). That seems like a pretty fair comparison.

Apple would have needed to sell 3.2 million more to reach 90% of 2010's tablet market share against just Samsung alone (in triple the time). That's not including all of the Android-powered Nooks out there, those cheap $100 Androids you can buy at Walgreens or Amazon and even Windows-powered Tablet PCs (which are mentioned two bullet points above!). If you choose to include the Kindle, Apple may not have even reached 50% of the market.

Perhaps Jobs meant market share of tablets that start with the letter "I."

And finally, pricing:

As for pricing, Jobs compared the most expensive Android tablet -- the XOOM --against the iPad. While specs don't matter to the typical consumer, components do largely affect the price of a device. The XOOM's are simply better. It has (expandable) 32GB of storage built in and 3G built in (upgradable through a painful mail-in process to 4G). So, on that alone, it compares with the $729 iPad.

But then consider that the XOOM has a much better, bigger 720P+ screen compared to the iPad's 1024x768 job (it has less Retina™). Then, add far superior cameras (w/flash), stereo speakers (iPad 2 has one), 4G and a micro-USB/SD Card reader. Apple won't say how much RAM the iPad has, but I'm willing to bet it is about half of the XOOM's 1GB.

You see, Apple loves to talk about specs when it is in its best interest (speeds and feeds). "Retina display has 326PPI", "1GHz Dual Core Processor", "64GB of storage", "Fingerprint-resistant oleophobic coating", "Back camera: Video recording, HD (720p) up to 30 frames per second with audio; still camera with 5x digital zoom", etc. etc. But ask them how much RAM the iPad has and they'll tell you it doesn't matter.

Perhaps Jobs could have also compared the iPad 2 to other Android tablets' prices? Samsung's Galaxy Tab and Dell's Streak both now start at $499 and have better cameras, 3G radios and GPS, which seem to compete well with Apple's $499 Wifi-only offering. Reality distorted.

I have a lot of respect for Steve Jobs and Apple's products. It's just a shame that all the truth-bending destroys the keynotes.
http://tech.fortune.cnn.com/2011/03/...toll-on-truth/

Just How Bad Is the iPad 2 Camera?
Charlie Sorrel

It seems impossible for Apple to put a decent camera into anything but the iPhone, and despite many hopes, both cameras in the iPad 2 are about as rudimentary as you could get without having to load a roll of film in there.

In fact, the iPad 2’s camera has more in common with the low-res camera in the iPod Touch than it does to the rather excellent one in the iPhone 4.

The specs for the iPad’s rear-facing camera only lists one number: 720p. That should mean 1280 x 720 pixels, which gives a megapixel figure of 0.92, clearly useless for stills.

However, flip over to the iPod Touch camera specs and we see the following: “HD (720p) up to 30 frames per second with audio; still photos (960 x 720) with back camera.” Yes, the Touch shoots stills at an even lower resolution than video, most likely because the wide-screen movie format is squared-off to shoot stills. The stills it produces are just shy of 0.7 megapixels, or about the same resolution as an early 1990s-era digital camera.

It’s extremely likely that the iPad 2 and the iPod Touch share the exact same camera (although we won’t know for sure until iFixit tears one open to see). It seems that it will be fine for movies, and bad for photos.

Then again, with the camera connection kit you can always just import images from a real camera. And for taking notes, snapping menus or grabbing pictures before grunging them up and sending them off to Instagram, it’ll do the trick.

Still, for a device that costs a minimum of $500, it would be nice to have a better image sensor, rather than these bottom-of-the-barrel ones Apple insists on using. Will we ever get one? It’s starting to look rather doubtful.
http://www.wired.com/gadgetlab/2011/...ipad-2-camera/

iPad 2's New Features: Video Hands On
Tim Gideon

The iPad 2 is finally here, and PCMag got some hands on time with the new tablet immediately after Steve Job's press event. The new features include the much expected dual-cameras—with camera-focused apps like FaceTime, iMovie, and Photo Booth. The thin new contour, available in both black and white, is also impressive—side-by-side with the original iPad, it is clearly thinner—though not quite as significantly as the photos during the event seemed to showcase.

Our video walks you through some of the key features, but here's a quick breakdown.

The A5 Chip

We haven't been able to run any speed tests on the iPad 2 just yet, but one thing was clear from our hands-on time with the unit: it was quite fast. The "twirl" effect in Photo Booth looks amazing—you can twist and distort images in real time with your finger just by dragging it around the screen. It's goofy fun—but also something a slow processor would have trouble with. Manipulating a live image in real time with such grace is the sign of a machine that can perform complex tasks quickly. The 1GHz dual-core A5 chip appears to be all that Jobs bragged about: a chip with drastically faster graphics processing.

Cameras and FaceTime

Steve Jobs is a master of avoiding the negatives during presentations. Instead of telling you the screen resolution will remain the same, he first tells you that with all these new features and a thinner frame you would think something has to give, right? Nope, he follows up—the screen is still the same resolution even though the device has so much more packed in to a smaller contour. See what he just did there? Well, he also artfully dodged this: With the new MacBook Pros, the built-in webcams shoot 720p and thus Apple has dubbed their video chat capabilities as "FaceTime HD." Nice, but it kind of draws attention to the fact that anything not labeled FaceTime HD is, well, not HD. The iPad 2's rear-facing camera shoots 720p, but the front-facing camera is VGA-quality—definitely not HD. Do people care? They don't now because the news is that the iPad 2 now has cameras and FaceTime, and that's obviously an improvement. Down the road, as they see their friends' MacBook Pros with better video quality on chats, they will grow envious. But hey, you have to save something for March 2012, right?

As for how well the video chat feature works—it's just as easy as it is on an iPhone or iPod touch. I have always noticed a slight delay in my FaceTime chats—primarily because I'm often speaking to someone nearby as a test, and therefore can actually hear the delay in audio. There was still a noticeable short delay with the iPad 2's FaceTime chats, but nothing horrible. Still, I find the closed nature of FaceTime—it only works on Apple products--to be a downside when Google's Talk works across several platforms. Anyone who has a webcam and a Gmail account can have a video chat with someone using Google Talk on an Android tablet. You cannot use FaceTime to chat with anyone using anything other than FaceTime on an Apple product, however. Apple could improve this in the future by allowing Windows PCs to download FaceTime—much as they can use iTunes and Safari—and just let anyone with a webcam in to the FaceTime party. For now, the party is cool, but feels pretty exclusive.

It's Thinner

It's true—the iPad 2 is noticeably, if not drastically, thinner than the original. But the slimming down is not the real story. It was virtually impossible to own the original iPad without the case, which many users (this one included) found a little cumbersome after a while. Jobs said it best at the event: why hide the good-looking device you just bought? But the real problem with the case was: it made the iPad much bulkier, as well. Enter the Smart Cover. The magnetic, snap-on covers come in Polyurethane or leather and manage to protect the screen, save battery life by putting the device to sleep when you snap one on, and keep the thin profile of the device relevant by not bulking it up. It remains to be seen if the Smart Covers, which double as stands just as the case did, will stay in place in a crowded briefcase or purse, but my first impression is: this is one of the most clever, simple, and useful accessories Apple has ever created.

As for the iPad 2 being lighter, I have held one for a while and can say that eventually, just like its predecessor, it will get heavy. but lighter is better than staying the same.

GarageBand and iMovie Apps

As a bit of musical purist, I approach apps like GarageBand from a highly skeptical standpoint. After a few minutes playing with the GarageBand app, which is far more engaging than the GargeBand computer software, I am a changed man. As a musician and a music lover, I see it accomplishing two things: it's a tool for songwriters who can't always carry an instrument around but have an idea they don't want to forget, and it's a fun way to engage non-musicians in the creative process. The touch screen is what brings GarageBand to life in a way the computer software never could—you can strum a virtual guitar, pick single strings, and learn about chord progressions in the process. I think young children will love GarageBand and may be inspired to go out and pick up the real version of whatever virtual instrument they were playing. Adults with no musical skills will get a kick of out of feeling like they do, and everyone will learn a little bit about how instruments they are used to hearing actually work. I've only just glimpsed at it and played with it briefly, but for $4.99, it's probably the best app I have ever seen in the iOS world.

I am less blown away by iMovie—but only because we have already seen it on the iPhone 4. It's still great. You shoot video on your device—or import it from your computer—and edit on the device itself. Transitions, effects, text, sound effects, music—this can all be added in a pretty simple and intuitive manner. If you plan on using the video camera on your iPad 2 a lot, it's a no-brainer to spend $4.99 on this app and make your device a mini editing studio.

HDMI Out

This is huge. You can now rent a movie on your iPad and watch it on your television, with the help of a tiny cable that plugs in to the the 30-pin connector on one end and has an HDMI connection on the other. It also has another 30-pin connection alongside the HDMI so you can be charging your device at the same time you are watching it on TV. We were unable to demo this feature at the event, but the fact that you can watch video or "mirror" your iPad's screen—which literally shows exactly what your iPad's display shows on your television, even if the keyboard is up—is great. I have one word for you: games.
http://www.pcmag.com/article2/0,2817,2381310,00.asp

Resist the Pull of Smartphones, Nintendo President Urges Developers
Joshua Brustein

Satoru Iwata, the president of Nintendo, speaking at the Game Developers Conference.Kim White/Nintendo of America, via Associated Press Satoru Iwata, the president of Nintendo, speaking at the Game Developers Conference.

The president of Nintendo told video game developers Wednesday that smartphones were driving a trend toward lower quality, and economically unsustainable, video games.

“I fear our business is dividing in a way that that threatens the continued employment of those of us who make games,” said Satoru Iwata during a keynote address at the Game Developers Conference in San Francisco. “Is maintaining high value games a top priority, or not?”

The emergence of low-cost video games for smartphones has led to a major shift in the way that many people experience video games. And for a company like Nintendo, whose strategy has long relied on converting non-gamers with non-threatening offerings like Tetris and the Wii, the popularity of casual smartphone games like Angry Birds is particularly ominous.

This threat was underscored just minutes after Mr. Iwata finished speaking, when Steven P. Jobs took the stage at the Yerba Buena Center for the Arts just across the street to introduce a new version of the iPad. Among the new features of the iPad was a gyroscope, which game developers have already been using to make games for the iPhone.

While smartphone games have caught on for their ease of use and low price, video game console makers have looked to distinguish themselves by creating devices that do things that phones cannot. Nintendo’s biggest response has been the 3DS, a portable 3-D gaming device that does not require glasses. The 3DS, which sold out in Japan within days of its introduction there last week, will be available in the United States on March 27. Mr. Iwata’s presentation at the conference focused largely on the new device; he announced that the 3DS will have new versions of two of Nintendo’s most popular titles — Super Mario and the Legend of Zelda — but that they will not be ready until several months after the game is sold in the United States.

In his address, Mr. Iwata said that video games for smartphones were generally of lower quality, and that their low costs would rarely pay for the development of quality games. He also argued that a company like Nintendo, which makes both hardware and software for gaming, would always be a better ally for developers than phone manufacturers.

“When I look at retailers and I see the $1 and free software, I have to determine that the owner doesn’t care about the high value of software at all,” Mr. Iwata said.

Still, the rapidly increasing smartphone market is proving irresistible to game developers, industry analysts said. And the ubiquity of the devices is undermining the economic argument to designing more expensive games for smaller audiences.

“There’s no doubt, in my mind at least, that these smartphones are legitimate game platforms and legitimate competitors,” said Colin Sebastian, an analyst with Lazard Capital Markets. “That argument gets harder for Nintendo to make every year.”

Meanwhile, Nintendo is moving beyond gaming with the 3DS, much as it has done with the Wii. Nintendo announced Wednesday that the 3DS will be able to stream content from Netflix. Users will also be able to pause a movie on the 3DS and restart it at the same point on a Wii, or vice versa. Nintendo is also working with movie studios to show 3-D versions of trailers on the devices. Green Lantern, which will premier in June, will be the first such trailer available.

Nintendo is also working to create a 3-D channel that will offer exclusive short form videos on the device. Mr. Iwata declined to provide specific information about the content, but said that channel would be live by mid-year. The company is also working to create a version of the 3DS that will capture 3D video.
http://bits.blogs.nytimes.com/2011/0...es-developers/

Minecraft Game Creator Says File Sharing & Piracy is Not Theft
Justin_Massoud

A well-worn counter to the claim ‘piracy is theft’ is that it’s just sharing, or borrowing, or accepting a gift: ‘I’m not stealing this video game; a friend gave me a copy. Those GBs of music on my hard drive? Think of them as a mix tape. You wouldn’t sue someone for that, would you?’

Thanks to Minecraft creator Markus “Notch” Persson, pirates now have several new counter-arguments against those who view them as petty thieves, though maybe not all of them should be employed.

Speaking to an attentive collective gathered at the Game Developer Conference’s Indie Games Summit, the successful designer declared “Piracy is not theft.” Depending on your own personal stance, this quote – from someone who not only consumes content, but produces it – either elicited a hearty ‘right on!’ or a quizzical ‘are you serious?’

Persson’s reasoning was simple, if not completely logical: “If you steal a car, the original is lost. If you copy a game, there are simply more of them in the world.” Perhaps pirate sympathizers should come up with better analogies. Is there an “Analogies for Dummies” book they could download?

Elaborating on his outlook, Persson said, “There is no such thing as a ‘lost sale.’ Is a bad review a lost sale? What about a missed ship date?”

To be sure, Persson speaks from a unique position.

He’s a game designer whose PC hit “Minecraft” enjoys success despite offering both free and paid versions. Over 1 million players bought the game, which is currently in Beta. In total, nearly 5 million people downloaded the odd build-your-own-world sandbox survival title. Offering the title free of charge with an option to buy, Persson sidesteps piracy fears: you can’t ’steal’ what’s free.

But will other game developers follow suit?
http://www.myce.com/news/minecraft-c...t-theft-40877/

ISP pits gamers against swappers

Virgin Media UK to Clamp Down on Peak Time Upstream Broadband P2P Traffic
MarkJ

Cable giant Virgin Media UK is preparing to impose a new broadband ISP Traffic Management regime upon P2P (File Sharing) and Newsgroup upstream traffic between the Peak Time (5PM to Midnight) hours. It's hoped that the move will improve the performance of other non-P2P services, such as multiplayer gaming (latency), which has apparently suffered due to heavy P2P uploading activity.

Virgin Media Status Update (2nd March 2011)

After the successful out of hours trial of our combined upstream and downstream file sharing traffic management policy we will be trialling this new policy between 17:00 and 00:00 for one week starting on Wednesday 2nd of March.

Between these times P2P and Newsgroup upstream traffic will be managed in a similar way to our current downstream traffic management. If the trial is successful we'll launch the new policy immediately.

We're interested if you could tell us how this affects your gaming experience over the next few days and if you see any general improvement in latency and ping at peak times.

Virgin's existing peak-time policy for upstream traffic management runs from 3PM - 8PM (except on the old 2Mbps legacy service where it runs from 9AM - 9PM). It's worth pointing out that many multiplayer games, such as XBox Live titles, World of Warcraft and others (Steam etc.), are ironically reliant upon P2P performance. However Virgin should be able to make exceptions for these.
http://www.ispreview.co.uk/story/201...p-traffic.html

China File-Sharing Company Xunlei Plans U.S. IPO
Jonathan Landreth

Google-backed Chinese video and music file-sharing firm Xunlei, once sued by six Hollywood studios for film piracy, hopes to raise $200 million in a U.S. initial public offering, hiring JPMorgan Chase and Deutsche Bank to get ready.

The company, whose name is pronounced “shoon-lay,” will follow Chinese video-sharing firm Youku and e-commerce site Dangdang into the U.S. market, Bloomberg News said on Thursday, citing sources familiar with the IPO plans of the Shenzhen-based outfit.

Xunlei, which also offers online games, had about 190 million online video users at the end of 2010, according to Beijing-based consultancy Analysys International. That’s a substantial chunk of the 457 million Chinese government estimates show were online by the end of 2010.

Xunlei would hope to repeat the performance of the U.S. shares of Youku, China’s biggest online video site, which surged 161% in their Dec. 8 New York debut, posting the sharpest first-day gain in a U.S. IPO since shares of leading Chinese search-engine Baidu were listed in 2005.

If the listing plans are for real, Xunlei will have to convince individual investors in the U.S. markets that it’s playing fair and is not exposed to the sort of copyright infringement lawsuits it faced three years ago.

In January 2007, the Motion Picture Association of America first pointed the finger at Xunlei for allowing unauthorized downloading of its Hollywood studio members' films.

Later that year, Xunlei attracted investment from Google, from Fidelity Asia Ventures, a Hong Kong-based firm led by Daniel Auerbach, a former board member of Yahoo! China-owner Alibaba, and from Ceyuan Ventures, a Beijing-based firm advised by John Wadsworth, honorary chairman of Morgan Stanley Asia.

In 2008, six Hollywood studios filed a civil complaint against Xunlei in a Shanghai court, saying its peer-to-peer technology enabled the unauthorized download of 78 movies, including Spider-man 3, War of the Worlds and Miami Vice.

The MPA member companies sought $975,000 and Xunlei’s public acknowledgment of copyright infringement and a promise to cease and desist all such activities, said MPA Asia-Pacific deputy director and legal counsel Frank Rittman at the time.

In February 2008, Xunlei paid roughly $21,000 in damages to Shanghai Youdu Broadband Technology for profiting from the illegal online distribution of Confession of Pain starring Tony Leung and Takeshi Kaneshiro. Youdu owned online distribution rights to the film.
http://www.hollywoodreporter.com/new...-xunlei-164216

Have You Driven a Smartphone Lately?
Maureen Dowd

I’m barreling along a rural Michigan highway at 75 miles per hour in a gray Ford Taurus X when I glance down to check a number on a screen.

It can’t be more than two seconds, but when I look back up, I’m inches from plowing into a huge green truck. Panicked, I slam on the brakes.

Even though I’m in Virttex, the Ford simulator that uses virtual reality to give you the eerily real sensation that you’re flying down the highway past cars and barns, I still feel shaken.

I made the mistake of taking my eyes off the road for more than 1.5 seconds, which is the danger zone, according to technology experts at Ford headquarters.

Ford, Chrysler, Chevy and other car companies are betting on the proposition that, as long as your eyes don’t stray from the road for more than a moment, your other senses can enjoy a cornucopia of diversions on your dashboard.

I worried in a prior column that Ford cars with the elaborate and popular new “in-car connectivity” sounded like death traps. Ford Sync lets you sync up to apps, reading your Twitter feeds to you. MyFord Touch plays your iPod on demand and reads your texts to you — including emoticons — and allows you to choose one of 10 prewritten responses (“I’m on my way,” “I’m outside,” “O.K.”). It also has voice-activated 3-D navigation that allows you to merely announce “I’m hungry” or “Find Chinese restaurant.”

Your car can even help you with a bad mood by giving you ambient lighting, vibrating your seat or heating your steering wheel.

Ford executives invited me to Detroit to experience their snazzy new technology firsthand.

They are on the cusp of a system featuring the futuristic avatar Eva, the vaguely creepy face and voice of a woman on your dashboard who can read you your e-mail, update your schedule, recite articles from newspapers, guide you to the restaurant where you’re having lunch and recommend a selection from your iPod. Ford’s working on a Web browser, which would be locked while driving.

Remember when your car used to be a haven of peace from the world? Now it’s just a bigger, noisier and much more dangerously distracting smartphone.

Over lunch at Ford, Sue Cischke, a dynamic company executive, argued that even before cellphones and iPods, drivers were in danger of distraction from reaching for a briefcase or shooing away a bee.

“Telling younger people not to use a cellphone is almost like saying, ‘Don’t breathe,’ ” she said.

Given that Americans are addicted to Web access and tech toys, she said, it will never work to simply ban them. “So we’ve got to figure out how we make people safer,” she said, “and the more people can just talk to their car like they’re talking to a passenger, the more useful it would be.”

Given that, however, we’re talking about human beings who live in an A.D.D. world, wouldn’t it be safer to try to curb the addiction, rather than indulging it? Nobody thought you could get young people to pay for music after downloading it for free, either, but they do.

David Teater, a former market research consultant to auto manufacturers, lost his 12-year-old son in a distracted driving accident in Grand Rapids, Mich., seven years ago. A 20-year-old nanny driving her charge in her employer’s Hummer was so immersed in a cellphone call that she ran a red light and smashed into Teater’s wife’s Chevy Suburban. Now he works at the National Safety Council.

He says he doesn’t expect car companies — which are trying to make cars more seductive — to be arbiters of safety. “They were slow to move toward seat belts and airbags until we, the customer, said we want it,” he said. He sees the overwrought dashboards as trouble. “We can chew gum and walk, but we can’t do two cognitively demanding tasks simultaneously.”

Ray LaHood, the secretary of transportation, is livid about the dashboard bells and whistles. When he saw a Ford ad with a bubbly young woman named Kelly using the new souped-up system to gab on the phone hands-free and not paying attention to the road, he called Alan Mulally, the president and C.E.O of Ford.

“I said to him, ‘That girl looks so distracted, it belies belief that this is what you want in terms of safety,’ ” LaHood told me. “Putting entertainment centers in automobiles does not contribute to safe driving. When you’re trying to update your Facebook or put out a tweet, it’s a distraction.”

He said he would compile his own statistics, meet with car executives and use the bully pulpit. “We’ll see what the auto companies can do voluntarily and what we need to do otherwise,” he said. “I don’t think drivers should be doing any of that.”
http://www.nytimes.com/2011/02/27/opinion/27dowd.html

Publishers Look Beyond Bookstores
Stephanie Clifford and Julie Bosman

Kitson, a group of boutiques based in Los Angeles, is the kind of store that appears regularly in the tabloids for both its stylish clothes and its celebrity clientele like Sean Combs and Joe Jonas.

But in a town that is all about flash, Kitson is finding a surprising source of revenue that is not from its fashionable shoes or accessories. It is from books.

The company’s owner, Fraser Ross, estimates that Kitson sold 100,000 books in 2010, double what it had the previous year.

Publishers turned aggressive about selling to Kitson, Mr. Ross said, as traditional bookstores switched focus or closed. That “has been good for us,” he said. “If there’s a good book, we’ll go deep into it.” And publishers, he said, “realize what a specialty store can do for their business, with the window and the table.”

Publishers have stocked books in nonbook retailers for decades — a coffee-table book in the home department, a novelty book in Urban Outfitters. In the last year, though, some publishers have increased their efforts as the two largest bookstore chains have changed course.

Barnes & Noble has been devoting more floor space for displays of e-readers, games and educational toys. Borders, after filing for bankruptcy protection in February, has begun liquidating some 200 of its superstores.

“The national bookstore chain has peaked as a sales channel, and the growth is not going to come from there,” said David Steinberger, chief executive of the Perseus Books Group. “But it doesn’t mean that all brick-and-mortar retailers are cutting back.”

A wide range of stores better known for their apparel, food and fishing reels have been adding books. The fashion designer Marc Jacobs opened Bookmarc in Manhattan in the fall. Anthropologie has increased the number of titles it carries to 125, up from 25 in 2003. Coldwater Creek, Lowe’s, Bass Pro Shops and even Cracker Barrel are adding new books. Some mass retailers, too, are diversifying — Target, for instance, is moving away from male-centered best sellers and adding more women’s and children’s titles this year.

Having a physical outlet for books is extraordinarily important, publishers say. While online and e-book sales are huge channels, lesser-known books can get lost in that world if they do not have a physical presence to spur interest. The ability to catch a shopper’s eye in a store is almost impossible to mimic online.

So publishers are approaching just about anyone with a shelf. For Perseus, sales at nontraditional retailers in 2010 outpaced its sales at Borders, which were around 7 percent, for the first time.

For Abrams, which publishes illustrated and art books, nontraditional retailers are seen as one way to offset the business lost by Borders, which has slowed especially in the last year, the Abrams president and chief executive, Michael Jacobs, said.

“We’ve definitely cranked it up,” Mr. Jacobs said. Last year, executives realized that “so much of our backlist wasn’t being carried by bookstores. If we’re still doing these books, where are we going to sell them?”

The nontraditional category has been growing for Abrams, making up more than 15 percent of its total business in 2010. Mr. Jacobs said he expected that it would grow to 25 percent in the next two to three years. Big publishers, too, like Houghton Mifflin Harcourt and Random House, say they have been seeking out specialty retailers.

The attention from publishers comes as a welcome surprise to the stores.

“The response has been dramatic. There are piles of book samples and catalogs dropped off in the shop every day,” Jennifer Baker, a book buyer for Marc Jacobs, said in an e-mail. “The assortment of rare and out-of-print books have been a challenge to keep in stock.”

Placement in different stores can widen the audience for books, appealing to someone who would not spend time at a Barnes & Noble. “A customer who might not often buy books but adores the brand can ease in to the Bookmarc selection,” Ms. Baker said.

Beyond attracting new readers, book sales tend to be a good deal for both sides.

Though sales to nonbook retailers can be more complicated and labor-intensive for publishers, books are generally sold on a nonreturnable basis. Bookstores, on the other hand, can return unsold books to publishers.

“We know it’s a nice clean sale,” said John Duff, publisher of Perigee Books, an imprint of Penguin Group USA.

The books tend to be profitable for the retailers, since they select them carefully and do not usually mark them down. More important, they can drive other purchases and help with branding.

At Lowe’s, books on subjects like cooking and home projects are stacked at the front of the store, “inspiring and informing customers to purchase goods that will allow them to successfully complete home improvement projects,” Patti Price, the company’s senior vice president for merchandising, said in an e-mail.

At Sam’s Club, which has long carried stacks of best sellers, more children’s books and cookbooks have been added lately. “Those are areas that don’t fit as well into the e-book story, like the best seller or mass-market or even romance books do,” said Phil Shellhammer, a Sam’s Club executive who oversaw the books category there until recently. Sam’s Club has been using its bricks-and-mortar advantage in other ways, too, like adding books from local writers, and bringing in authors for signings.

If Anthropologie is selling ikat prints, it might feature books with ikat covers, or it will carry books about inspiration and poetry to get the customer in an escapist mood.

“As we try to get them excited about different ideas as they walk in the door, books can be a tremendous way to narrate those stories,” said Aaron Hoey, head merchant for home and accessories at Anthropologie. “We do a very good job of selecting unique books, books you’re not going to find in a typical bookstore, and certainly not in a mass-market bookstore like Borders or Barnes & Noble. And to stumble across it at Amazon, you have to really know what you’re looking for.”

The specialty stores can be a boon for publishers selling quirky titles unlikely to get on Amazon’s home page. “Awkward Family Photos” is a hot item at Urban Outfitters, “Hello, Cupcake,” about cupcake design, has been selling strongly at the craft store Michaels, and Price Stern Sloan, another Penguin imprint, sold 42,000 copies of “Mad Libs” in January alone — at Cracker Barrel. At Bookmarc, where fashion titles sold predictably well, executives were surprised when “Erotic Poems” by E. E. Cummings started flying off shelves.

At Kitson, too, the top sellers hardly mimic the best-seller list, including books like “How to Raise a Jewish Dog” and “The Official Dictionary of Sarcasm.”

“We try to be different,” Mr. Ross said.
http://www.nytimes.com/2011/02/28/bu...ookstores.html

This 26-Year-Old Is Making Millions Cutting Out Traditional Publishers With Amazon Kindle
Pascal-Emmanuel Gobry

Welcome to disruption. 26-year old Amanda Hocking is the best-selling "indie" writer on the Kindle store, meaning she doesn't have a publishing deal, Novelr says.

And she shouldn't. She gets to keep 70% of her book sales -- and she sells around 100,000 copies per month. By comparison, it's usually thought that it takes a few tens of thousands of copies sold in the first week to be a New York Times bestselling writer.

The comparison isn't entirely fair, because Hocking sells her books for $3, and some $.99. But that's the point: by lowering the prices, she can make more on volume, especially impulse buys. Meanwhile e-books cost nothing to print, you don't have to worry about print volumes, shelf space, inventory, etc. And did we mention the writer keeps 70%?

Previously one of the best selling Kindle writers was J.A. Konrath, but it was assumed he was popular because he previously had a publishing deal and so already had notoriety. That's not the case with Hocking, who published stories on her blog before turning to Kindle. In fact, out of the top 25 best-selling indie Kindle writers, only 6 were previously affiliated with a publishing house.

Back of the envelope math suggests that selling 100,000 copies a month at $1 to $3 a pop and keeping 70%, Hocking can make millions per year, straight to her pocket.

Welcome to the new era, the one that scares traditional publishers to death and will make the world better for writers and readers alike. Congratulations to Amazon for making it possible. And congratulations to Ms. Hocking on her success.
http://www.businessinsider.com/amanda-hocking-2011-2

A Limit on Lending E-Books
Julie Bosman

A print book can be checked out of a library countless times, at least until it falls apart and needs to be replaced.

What about an e-book?

HarperCollins, the publisher of Michael Crichton, Sarah Palin and Dennis Lehane, said on Friday that it had revised its restrictions for libraries that offer its e-books to patrons.

Until now, libraries that have paid for the privilege of making a publisher’s e-books available for borrowing have typically been granted the right to lend an e-book — say, the latest John Grisham thriller — an unlimited number of times. Like print books, e-books in libraries are lent to one person at a time, often for two weeks. Then the book automatically expires from the borrower’s account.

HarperCollins said on Friday that it had changed its mind. Beginning March 7, its books may be checked out only 26 times before the license expires.

“We believe this change balances the value libraries get from our titles with the need to protect our authors and ensure a presence in public libraries and the communities they serve for years to come,” it said in a statement. The policy does not affect books already licensed by libraries.

Steve Potash, the chief executive of OverDrive, a provider of e-books to public libraries, said HarperCollins was the first publisher to limit how many times an e-book may be checked out.

The announcement was a reminder of the publishers’ squeamishness over having their e-books available in libraries. More people are using libraries for e-reading, a practice that does not require visiting a library in person, and is possible on many electronic devices, including the Nook and the iPad.

While hundreds of publishers make their e-books available to libraries, at least two major publishers, Simon & Schuster and Macmillan, do not.

Librarians fumed about the limit, complaining that it would require them to pay more for HarperCollins’s books when budgets are being cut.

“All libraries are going to think twice about what e-books they’re going to purchase in the future,” Leah L. White, a librarian at the Morton Grove Public Library in suburban Chicago, said Friday. Mr. Potash said the change would force some libraries, especially those that stock a lot of best sellers, to be more careful about the publishers from which they buy. “Libraries will have to consider whether they want to invest in titles that, after a year or 18 months or so, they’ll have to replenish or buy additional units,” he said. “There will be some who may have to be more selective about how they can use their digital book budgets.”

On Sunday, he said that OverDrive would take HarperCollins titles out of its general e-book catalog, which would keep them available but make them less easily accessible.
http://mediadecoder.blogs.nytimes.co...nding-e-books/

Investors Drawn Anew to Digital Music
Ben Sisario

Since it emerged in the 1990s, digital music has been hugely popular with fans, but for online music companies and their investors it has almost never been profitable.

And yet the money has again started pouring in.

Pandora, the popular Internet radio service, filed for an initial public offering in February that would raise $100 million. Spotify, a highly lauded European service, is reportedly raising $100 million from private equity firms to help it come to the United States.

And those are just the big fish. Since the end of last year, at least $57 million in venture capital has gone to digital music start-ups, ending a recent financing drought and setting up an array of young companies like Rdio, SoundCloud and RootMusic in an already crowded marketplace.

The heightened interest in a field that has had few winners and a vast graveyard of losers has left some longtime executives and analysts scratching their heads. Faced with thin margins, persistent piracy and expensive licensing deals from record companies, dozens of digital music start-ups have collapsed over the last decade, taking with them hundreds of millions of dollars in investment money. Even Apple, the largest music retailer, has long maintained that it makes little profit from its iTunes store, which has sold more than 10 billion songs since 2003.

“A number of the investors have not invested in digital music before,” said David Pakman, a venture capitalist who is the former chief executive of the download service eMusic. “Usually the ones who have, have learned over the decade that it’s an impossibly hard place to make money.”

Even more challenging for start-ups, two very big players are expected to introduce cloud-type music services this year: Apple and Google.

But more bullish investors point to technological developments and shifts in consumer behavior as signs that the business is about to turn a corner. These changes include the migration of digital media libraries from personal computers to the remote storage of the “cloud,” as well as the explosive success of smartphone applications. Pandora’s apps, for example, have been the biggest factor in driving that service to 80 million registered users, up from 46 million a year ago. (A basic, ad-supported service is free; the upgraded version, with no ads and higher-quality audio, is $36 a year.)

“Services like iTunes, Pandora and Spotify have shown that with the right product and the right business model, you can effectively monetize digital music, which is kind of new,” said Doug Barry of Selby Ventures, an early Pandora investor. “The last time around it was mostly about file-sharing and limited monetization.”

Rdio, which streams music by subscription, was founded by Janus Friis and Niklas Zennstrom, the entrepreneurs behind Skype, and the company recently announced that it had raised $17.5 million, some from the founders’ own venture firm, Atomico.

SoundCloud, which distributes user-generated audio content, said in January that it had raised $10 million. Over the last several months Slacker, Songkick, TuneUp, FanBridge, RootMusic and 3G Multimedia have each brought in $2 million to $6 million, according to figures reported by the companies and in the news media.

What most new services do not have yet, however, is a critical mass of paying users, usually defined in the millions. Investors look to the 20 million subscribers at both Netflix and Sirius XM Radio as signs that consumers are willing to pay for streaming content.

Yet those kinds of numbers have remained elusive throughout the history of digital music. Rhapsody, a streaming service begun in 2001, has 750,000 subscribers; eMusic, which sells downloads, has 400,000. Spotify, which has free and paid versions, has 10 million users in Europe, but only 750,000 of them pay (the rate is about $15 a month), a ratio that concerns the record labels.

“Until you get scale, it’s just too hard of a business to work,” said Tom Andrus, who is on the board of Rhapsody.

In another challenge, Apple announced two weeks ago that it would take a 30 percent cut of subscription fees and other purchases through its App Store, a move that digital-media companies of all kinds have criticized as being too steep.

Many investors say that while the labels’ weakened finances have led them to make slightly more friendly deals, they remain tough negotiators. Spotify, for example, recently signed contracts for American distribution with Sony and EMI, but only after more than a year of talks. (Spotify, as well as three of the four major record companies, declined to comment for this article.)

Partly as a way around the record companies, there has been a particular interest among start-ups for services that avoid license negotiations. These include Internet radio — although they still pay royalties set by statute — as well as ancillary businesses like ticketing and concert listings. Yet the focus remains on services that provide music to listeners, and many veterans of the field are skeptical that any of the new models can bring in the revenue to sustain a company.

“People are tantalized by the notion that all music is going to be digital, and that there’s a massive global demand that is not being met,” said Dave Goldberg, a former general manager of Yahoo Music who is now chief executive of SurveyMonkey, an online survey company. “But I don’t know that there’s a good solution out there for anybody who’s rationally looking at this as an investment.”

Pandora’s public offering brings some much-needed market glamour to the digital music business. But even some of the bulls caution that despite hope on the horizon, more music start-ups will inevitably end up in the digital graveyard.

“I think it will get overfunded,” Mr. Barry said. “At the end of the day there is a limit to how many people will pay a hefty subscription.”

“But in that process,” he added, “great services will be built.”
http://www.nytimes.com/2011/03/01/bu...a/01music.html

Apple Said to Negotiate Unlimited Downloads of iTunes Music Purchases
Adam Satariano and Andy Fixmer

Apple Inc. is in talks with record companies to give iTunes customers easier access to music they’ve purchased across multiple devices, said three people with knowledge of the plans.

Apple is negotiating with music companies including Vivendi SA’s Universal Music Group, Sony Music Entertainment, Warner Music Group Corp. and EMI Group Ltd., said the people, who asked for anonymity because the talks are private. An agreement may be announced by midyear, two of the people said.

The arrangement would give users more flexibility in how they access purchased music. Apple and the record labels are eager to maintain demand for digital downloading amid rising popularity for Internet services such as Pandora Media Inc., which don’t sell tracks and instead let users stream songs from the Web, whatever the device.

A deal would provide iTunes customers with a permanent backup of music purchases if the originals are damaged or lost, said the people. The service also would allow downloads to iPad, iPod and iPhone devices linked to the same iTunes account, they said. The move would be a step closer to universal access to content centrally stored on the Internet.

Tom Neumayr, a spokesman for Cupertino, California-based Apple, declined to comment. Apple, maker of Macintosh computers, gained $7.44 to $359.56 yesterday in Nasdaq Stock Market trading. The shares have climbed 11 percent this year.

Amanda Collins, a spokeswoman at Warner Music in New York, declined to comment, as did Liz Young, a Sony Music spokeswoman. Peter Lofrumento, a spokesman for Universal Music, and Dylan Jones, a spokesman for EMI, didn’t have an immediate comment.

Digital Downloads Stall

Apple, which first began selling tracks through iTunes in 2003, became the top U.S. music retailer in 2008, surpassing Wal-Mart Stores Inc. ITunes accounted for 69 percent of all digital downloads in the U.S. as of September, according to research firm NPD Group Inc.

Music companies are grappling with stalled digital-download sales, a sign online purchases won’t be enough to make up for declining sales of compact discs. Digital-track sales rose 1 percent in 2010, while total album sales fell 12.7 percent, according Nielsen SoundScan.

The new download policy is among several service changes Apple is exploring. The company has also weighed plans to overhaul its MobileMe service for storing pictures, videos and other content online this year, one of the people said.

Under one plan for MobileMe, the service that now costs at least $99 a year would become free. Users could store photos, contacts, e-mail and other content on Apple’s servers, one person said. The content would be accessible through any wireless connection. The potential changes to MobileMe were previously reported by the Wall Street Journal.

Apple will be able to accommodate newly overhauled services with a new $1 billion data center in North Carolina. Chief Financial Officer Peter Oppenheimer said at Apple’s annual shareholder meeting last month that the facility will be a hub for the iTunes and MobileMe services.
http://www.bloomberg.com/news/2011-0...purchases.html

One on One: Girl Talk, Computer Musician
Nick Bilton

Gregg Gillis, a musician who performs under the name Girl Talk, creates a unique style of music using a laptop computer to chop up and reuse mainstream pop songs. His work, which is heavily influenced by mathematics, manages to pair divergent genres of music, mixing Madonna and Black Sabbath. His work has also questioned copyright law and fair use with respect to digital music. The following is an edited version of an interview with Mr. Gillis.

Nick Bilton: How did you start creating music using a computer?
Gregg Gillis: I actually went to school for biomedical engineering. While I was in college I played around with music on the side, mostly just for fun. When I graduated I just kept making music, playing small shows and art galleries, and after two or three years things just took off with the style I had created.

So were you living two lives, biomedical engineer by day and D.J. by night?
Yes. By the time my music took off it was two years into my engineering job. So for a year I had to live a double life. I would tell my co-workers I was going to go to the movies over the weekend, but from Friday night to Monday morning I was flying all around the country performing in clubs.

In those early days, when you showed up to a club with a laptop, did they not take you seriously?
Some people were open-minded, but in a lineup of bands about to perform and you’re the only person with a laptop, you’re definitely the sore thumb of the group. It was also the type of music I was mixing. It was definitely rebellious to have a laptop and mix pop music.

So are you a D.J. or musician, or even a computer musician?
I actually think of what I do more as creating electronic music, not being a D.J., because it is all created on my computer; it’s also very mathematical.

Where did the name Girl Talk come from?
When I first got started years ago other people who were performing using laptops had strange band names like “TR_x5,” and I didn’t want a strange computer name so I came up with Girl Talk. It sounded to me like a Disney music girl-group full of teenagers, not a man playing on a laptop.

You have a very unique and technical style. How did it develop?
It’s definitely evolved over the years. Over time I have become more comfortable just creating mashup styles of music. Some of my early influences were Squarepusher and Aphex Twin.

How do you create your music using a computer?
It’s a big trial-and-error process. I have a running list of songs that I want to sample and I spend a lot of time just cataloging and cutting up those songs. The organization has become a huge part of it. I’ll spend hours trying to piece a couple of components together, and when something kind of sticks I build it from there.

What kinds of programs do you use to make music?
I only use two programs. The first part of the process, the cutting up, is done with Adobe Audition. Then I piece things together using a program called Audiomulch, which I also use to perform live. I also perform using Panasonic Toughbooks, and when I’m on stage I wrap my computers in Saran Wrap.

Did you bring your biomedical engineering background to making music?
Yes, I think so. They are both very meticulous. I think a lot of times on an album I can sit there for hours to try and figure out one piece of music, which is the same with engineering.

You music is made up of other people’s music. Have you faced any copyright issues?
I put my music out there and hope for the best. It is clearly in a gray area but I believe it should fall into fair use under copyright law. I feel like people are not listening to my music instead of buying a CD or album of an artist I feature. Instead, people find new musicians because of a sample on one of my records.

Is this more acceptable in today’s digital world?
Yes. I think a lot of artists are used to their music being reused online and have come to accept and embrace it. You have a generation who go on YouTube and remake and remix music online all the time. They remake and upload songs and videos, and then other people remake the remakes; it just keeps going.

Have you ever been asked not to use someone’s music in your albums?
No, we actually get a lot of positive feedback. A lot of labels actually release a cappella versions for people to do remixes now. It really helps the sales and spread of their music.

Do you charge for the CDs?
My first three albums were released in a fairly traditional way where the CD cost $10. When we released the fourth album we said you can “pay what you want.” But this last album we didn’t even give people the option to pay, we just gave it away online and we completely skipped the physical CD. It really seemed like the most efficient way to reach a broad audience.

So how do you make money from your music?
I make the money from the tours and shows. In reality, I never anticipated this as a career. The fact that it came here like this has really become a surprise. I’ve found that the best way to make a career out of this industry is to get the music to as many people as possible.

Did it bother you when people illegally downloaded your first CDs?
Absolutely not. I loved it. It was really exciting. I actually used to go on Napster and LimeWire and check to see how many people where stealing the albums. It was very flattering.
http://bits.blogs.nytimes.com/2011/0...uter-musician/

Who Owns Betty Boop?
jerry

Apparently the Fleischer estate has lost a court battle for the rights to Betty Boop, a character created by Grim Natwick at Max Fleischer’s studio in 1930. Fleischer Studios has been co-licensing (with King Features) the property (along with Pudgy, Grampy, Binmbo and Ko-Ko the Clown) for several decades now.

The Fleischer Studio tried to sue Avela Inc. over its licensing of public domain Betty Boop poster images (for handbags and T-shirts). The 9th Circuit U.S. Court of Appeals (based in San Francisco) ruled against the Fleischers, saying in their decision, “If we ruled that AVELA’s depictions of Betty Boop infringed Fleischer’s trademarks, the Betty Boop character would essentially never enter the public domain.”

According to court documents, the Fleischer Studio originally assigned its rights to Betty Boop to Paramount Pictures on July 11, 1941. Paramount assigned those rights to Harvey Films, Inc on June 27th, 1958. Harvey actively licensed the character in the early 1960s. On May 15th 1980, Harvey Cartoons transferred “Betty Boop and her Gang” to Alfred Harvey and his brothers. Judge Susan Graber said there was no break in the chain of title.

So where does that leave Ms. Boop? No longer represented by the heirs of Max Fleischer and King Features Syndicate? Does this make Harvey Comics – or by extention, its current owner Classic Media – the owner of the property? Or is the character now in public domain.

For the record: The master film elements to original Fleischer Betty Boop cartoons are still owned by Paramount Pictures (and are maintained at the UCLA Film and Television Archive). Many of those films have legally entered the public domain, many others have not (they are still protected under copyrights held by Paramount/Viacom). We hope that someday the studio deems it fit to restore and release these classics on DVD.
http://www.cartoonbrew.com/classic/w...etty-boop.html

Dodd Cast in New Role as Hollywood Defender
Joe Meyers

A lobbying and trade group that was created by the film industry in 1922 largely in reaction to a rising chorus of civic leaders calling for movie censorship has evolved into a global policeman battling the ever-growing piracy of Hollywood product made possible by the Internet.

If you take a look at the website of the Motion Picture Association of America, you can find a breakdown of the movie rating system it created in 1968, but much of the web material is devoted to the challenges of making sure that everyone who sees "The King's Speech" or "The Fighter" pays for that privilege.

Just as the Internet has foiled dictators trying to prevent Twitter- and Facebook-fueled revolutions, file-sharing technology makes it possible for almost anyone to "steal" a movie and to send it anywhere in the world.

Last week, while I was grabbing a bite in a Manhattan fast-food restaurant, an elderly Asian gentleman went from table to table selling DVDs -- for $2 each -- of Hollywood movies that had just opened in theaters.

The same thing often happens on crowded subways in the city.

Although it is probably impossible to estimate how much money Hollywood loses this way each year, conservative estimates are in the billions.

China was added to the global Hollywood movie marketplace more than a decade ago. With a country and a population of that size -- and notoriously lax copyright enforcement -- who knows how much money 20th Century Fox and Universal are losing there?

The newly named chairman and CEO of the MPAA, Chris Dodd, is in the Washington-insider tradition of the man who led the group for much of its life, former Lyndon Johnson staffer Jack Valenti.

Valenti left the Johnson White House in 1966.

The MPAA chief's political connections eased the industry through a stormy period in which the unprecedented adult content of two 1966 Hollywood pictures -- "Who's Afraid of Virginia Woolf?" and "Blow Up" -- caused Middle American church and civic leaders to call for the creation of state and local censorship panels.

Within two years, a rating system was established by the MPAA that classified movies as being suitable for all ages or for more mature audiences.

The MPAA also created the first adults-only tag -- X (now NC-17) -- which restricted anyone under the age of 16 from seeing such naughty late-1960s/early-1970s releases as "Midnight Cowboy" and "A Clockwork Orange."

Just as five decades of censorship battles came to an end in the late 1970s, the compact new technologies of videotape and the DVD opened the Pandora's Box of piracy.

The reduction of movies to digital content for DVDs made the copying of Hollywood product possible for anyone who owned a computer -- a situation that exploded when that content could be transmitted as a file on the Internet.

The ever-expanding international audiences for Hollywood movies in the 21st century have broadened the scope of the job Dodd is stepping into -- he will be the movie industry's ambassador to the world as well the head of a domestic Washington, D.C., lobbying group.

The MPAA's choice has been endorsed by the major studios, who have found a legislative ally in Dodd for many years.

Tuesday's edition of the trade paper The Hollywood Reporter is filled with industry support for the ex-senator. Dodd has never worked in Hollywood, but he has long supported the movie business on key trade and piracy issues.

Last year, he was the author of a banking law with a section pushed by the MPAA that halted plans for a futures market in movies (i.e. betting on the success or failure of new releases).
http://www.newstimes.com/entertainme...er-1037300.php

Tribeca and Sundance Plan Growth
Brooks Barnes

Two big film festival operators, Tribeca Enterprises and the Sundance Institute, are about to greatly expand their efforts to use technology to bring specialty movies to a national audience.

For years, the business function of festivals was straightforward: create excitement for independent films, and hope that distributors acquire them for release.

But the rise of Web streaming and video-on-demand services freed festivals from their geographic limitations. Suddenly, the likes of Sundance, Tribeca and South by Southwest were experimenting with simultaneous film premieres at their festivals and on Web sites like YouTube or cable on-demand systems.

Now comes a new development — the end of experimentation and the start of full-fledged digital distribution efforts by festival operators.

Tribeca plans on Monday to announce a significant expansion of its fledgling movie releasing arm, Tribeca Film, which was founded last year as a test in releasing movies both digitally and in theaters. Tribeca Film plans to increase its annual output to 26 pictures, up from 11.

Among this year’s batch — set for distribution in theaters, on on-demand services in 40 million homes and on Web services like iTunes — are films starring indie favorites like Zach Braff and Vincent Gallo.

“We learned very quickly that our brand can resonate beyond New York,” said Jane Rosenthal, Tribeca’s co-founder. “There are hundreds of wonderful films that never have the chance to reach a wider audience, and we want to seize any possible opportunity to change that.”

Sundance, which has tinkered with distribution partnerships for years, is expected to announce a formal year-round strategy for helping indie filmmakers gain access to digital distribution in the coming weeks. People with knowledge of the matter, speaking on the condition of anonymity to avoid conflicts with the powerful organization, said plans called for Sundance-branded channels on iTunes, Amazon, Hulu, Netflix, YouTube and others.

Sundance executives declined to comment, saying efforts were incomplete. A spokeswoman emphasized, however, that the Sundance model would substantially differ from the Tribeca Films effort by allowing filmmakers to retain full ownership of their work. Sundance, unlike most other festival operators, is a nonprofit that also runs workshops for budding filmmakers and playwrights.

“There is big opportunity in this marketplace, particularly for a pocket of films that may not always have huge theatrical appeal but can take advantage of video on demand and other digital platforms,” said Rena Ronson, co-head of the Independent Film Group at United Artists Agency.

Tribeca and Sundance are reaching beyond their traditional functions for reasons of economics and technology. Hammered in recent years by the recession and soaring marketing costs, art house distributors like Paramount Vantage and Picturehouse went out of business, leaving a void in the market.

“It was kind of genius for Tribeca to jump in because almost nobody was left to buy anything,” said Julien Nitzberg, the director of “The Wild and Wonderful Whites of West Virginia,” a documentary about an eccentric Appalachian family that Tribeca Films successfully distributed last year.

At the same time, Web streaming and growth of video-on-demand systems in living rooms lowered the bar for distribution. Suddenly all kinds of indie films — not just the ones that showed strong theatrical promise — could be served up to wide audiences. The problem is that as digital offerings grow, these films, which come with little or no marketing budgets, have increasing difficulty breaking through the clutter.

The likes of Tribeca and Sundance, organizations with built-in curatorial mechanisms and brands that mean something to cinephiles, see opportunity to help serve as guideposts, thus helping this corner of the industry evolve into a more vibrant business. Mr. Nitzberg credits the Tribeca banner with helping his movie attract enough attention on Amazon’s streaming service to bump “The Hurt Locker,” last year’s best picture Oscar winner, from the top slot.

Some festival executives are not on board with the distribution push. “People approach us all the time because we have a great brand, but distribution is a very different business,” said Janet Pierson, the programmer of the film portion of the South by Southwest festival in Austin, Tex., which this year runs March 11 to 19.

Ms. Pierson has experience to back up her assertion. South by Southwest teamed with IFC Films in 2009 to make five movies available simultaneously to festival audiences in Austin and to pay-per-view television customers across the United States. She has since abandoned such efforts. “It gets very complicated very quickly,” she said. “We want to focus on being a great live event.”

But Ms. Pierson is in the minority. Other festival operators, like Film Independent, the force behind the Los Angeles Film Festival, are working to follow the path charted by Tribeca and Sundance. A group of African-American-oriented festivals — the BronzeLens Film Festival in Atlanta, the ReelBlack Film Series in Philadelphia — recently announced an alliance to back the release of their movies in commercial theaters.

Tribeca’s distribution effort is unique in part because it has a major corporation, American Express, as a promotional sponsor. It has also made arrangements for its films to be shown on LodgeNet, a video-on-demand service that reaches about 1.8 million hotel rooms.

Ms. Ronson of United Talent said Tribeca was being taken seriously as a distributor in part because of the executives it has hired. Within the last year, Nick Savva, formerly of Revolver Entertainment, has joined Tribeca as director of acquisitions; Randy Manis, a co-founder of ThinkFilm, a production and distribution company known for releases like “Half Nelson,” is a consultant.

Tribeca, which will hold its festival from April 20 to May 1 in Manhattan, is expanding its distribution business as the art house market shows signs of a rebound. Acquisitions were brisk in January at the Sundance Film Festival and a few Oscar-nominated movies like “Black Swan” have turned into unlikely box office hits. But Ms. Rosenthal is not taking anything for granted.

“With the rapidly evolving landscape,” she said, “we all have to be extremely fast on our feet.”
http://www.nytimes.com/2011/02/28/bu.../28indies.html

Comcast, NBC Deal Opens Door for Online Video
Joelle Tessler

New Internet video services from companies such as Netflix and Apple are offering a glimpse of a home entertainment future that doesn't include a pricey monthly cable bill.

To challenge the cable TV industry's dominance in the living room, though, online video services need popular movies and TV shows to lure viewers, and access to high-speed Internet networks to reach them.

Yet they have had no rights to either — until now.

To win government approval to take over NBC Universal last month, cable giant Comcast Corp. agreed to let online rivals license NBC programming, including hit shows such as "30 Rock" and "The Office." Comcast also agreed not to block its 17 million broadband subscribers from watching video online through Netflix, Apple's iTunes and other rivals yet to come.

Those requirements aim to ensure that the nation's largest cable TV company, with nearly 23 million video subscribers in 39 states, cannot stifle the growth of the nascent Internet video business. Although they apply only to Comcast and NBC, these conditions could serve as a model for other big entertainment companies in dealing with new online competitors. They also send a powerful message that the government believes these promising young rivals deserve an opportunity to take on established media companies.

"These conditions are not just window dressing," said Paul Gallant, an analyst for MF Global, a financial brokerage. "They come across as a pretty comprehensive effort to give Internet TV a real shot at taking off."

The Federal Communications Commission and the Justice Department spent more than a year reviewing Comcast's plan to buy a 51 percent stake in NBC Universal from General Electric. The deal gives Comcast control over the NBC and Telemundo broadcast networks, cable channels such as CNBC and Bravo, the Universal Pictures movie studio and a stake in Hulu.com, which distributes NBC and other broadcast programming online.

Government officials wanted to ensure that Comcast could not crush competition through its control over both a major media empire and the pipes that deliver cable and Internet services to millions of American homes.

But figuring out how to protect online video was tricky because the market is still taking shape.

Netflix offers subscription plans with unlimited online viewing for $8 a month. Apple and Amazon.com let customers rent or buy individual movies and TV shows for as little as a few dollars apiece — providing an alternative for people who don't want big bundles of cable channels they may never watch. Apple and Google make set-top boxes and software that transfer online video to television sets, freeing it from computer screens. TV makers are also building in Internet capabilities.

All these options could make it easier to cut the cable cord — and the cable bill. In 2010, Comcast's cable customers paid an average of $70 per month for video services.

But with control of NBC Universal, Comcast could handicap Web rivals by overcharging for — or simply withholding — all sorts of marquee content. A "Top Chef" fan, for instance, might not drop cable if the show weren't available online. Comcast could also block or slow online video traffic on its massive broadband network. ITunes can't compete with cable if programs stutter online.

None of the major online video companies would comment about Comcast. The cable company insists that it doesn't consider Internet video a threat. Indeed, the Internet lets Comcast expand beyond its existing cable service territory and distribute NBC content more widely, through a broad range of websites and devices.

Still, in approving the deal, federal officials attached dozens of conditions, including several big ones to protect Internet video:

• Comcast must sell its content to online video services. That gives them access to marquee NBC Universal programming.

• Comcast can't interfere with Internet video traffic flowing over its broadband network. That means that it cannot prevent its subscribers from accessing Netflix and other Web video services, or slow down traffic from these services to make them jerky, unreliable and hard to watch.

• Comcast must sell stand-alone Internet access at a reasonable price, without tying it to a cable TV package, to enable cord-cutting. That includes offering a standard 6-megabit-per-second plan, which is fast enough to handle Internet video, for roughly $50 a month.

Although these requirements offer no guarantees of success for new online video services, they aim to ensure that Comcast cannot impede the online businesses. They also break new ground by giving Internet rivals some of the same protections that have long been available to satellite companies and other subscription TV competitors.

Existing FCC rules require cable TV companies to license the channels they own to such rivals. Now, new Internet video services can license big packages of NBC Universal programming for the same price that a traditional rival pays. Or they can buy specific shows or channels if they are already licensing comparable programming from another major media company. For example, if Netflix strikes a deal to license children's programming from The Walt Disney Co., Comcast must make comparable children's programming from NBC available to Netflix under similar terms.

Only Comcast and NBC are bound by these conditions, yet they could pressure other media companies to make their programming available to online services, too. They could also serve as a blueprint for future government merger reviews and even shape new FCC rules affecting the whole industry.

"Before this deal, online video distributors had no rights to programming at all," Stifel Nicolaus analyst Rebecca Arbogast said. "This opens the door."

That said, the rules make no promises. Internet companies may not be able to afford the full NBC Universal programming package as satellite TV and other rivals now do, said Thomas Eagan, an analyst with Collins Stewart. Even Netflix, with more than 20 million subscribers, would have trouble paying a tab that Eagan estimates at $1.5 billion a year.

This approach also shackles these new companies to traditional business models and inhibits innovation, added Philip Leigh, an analyst with research firm Inside Digital Media.

What's more, a lot is open to interpretation with the requirement that Comcast follow the lead of other big media companies that license comparable programming — say, comedies or reality shows — to online services. For instance, should Bravo have to license "The Real Housewives of Beverly Hills" to an online distributor just because MTV is providing "Jersey Shore"?

And what is to stop all the big media companies from simply operating in lockstep and withholding all programming from online distributors, which would prevent that option from being triggered?

David Cohen, Comcast executive vice president, has said the company could use various arguments to limit the types of programming it must supply. Disputes could wind up in arbitration.

Meanwhile Corie Wright, policy counsel for the public interest group Free Press, said she is disappointed that the government conditions do not attempt to break up a new online service being pioneered by Comcast and other subscription-television providers. This service, which Comcast calls Xfinity, puts popular cable shows on the Internet, but restricts access to subscribers.

"The government may have effectively blessed a business model that forces consumers to pay for a cable subscription to watch video online," she said.

At this early juncture, it's impossible to predict just how the market will evolve. Will Netflix and Apple squeeze the cable industry out of the living room? Will cable companies successfully fend off new online challengers? Or will there be room for both?

Consumers will ultimately decide. But at least viewers will have a choice.
http://news.yahoo.com/s/ap/20110228/...c_online_video

Comcast Won’t Go Streaming-Only, But Dish Might
Ryan Lawler

Pay TV providers are increasingly seeing competition from online video services like Netflix and Hulu Plus, but they’re coming up with different business strategies in an increasingly digital world: While Comcast says it has no interest in building streaming-only offerings for customers that don’t live in its cable network, Dish Network is trying to secure rights from its content partners to offer its own over-the-top video services.

Of all the cable operators in the U.S., Comcast has the most robust platform for delivering video online, mobile devices like the iPad — and soon, even on connected TVs. But despite its heavy investments in making cable TV programming available as part of its TV Everywhere initiative, Comcast CEO Brian Roberts said in an interview with the Wall Street Journal that the company has no plans to extend those services to customers outside its cable footprint. When asked about the possibility, Roberts said his company’s goal instead was to provide more value to existing subscribers rather than trying to grab new ones solely online:

“Where we can add value, at least in the world that I see today, is taking our existing customers and giving them full access to all content online because they’re subscribers. So, today, we have that enabled for networks like HBO, Showtime, Cinemax, and Starz. We just made a deal with Time Warner and Turner. I hope we will be able to add to that quickly with NBCUniversal content and others.”

While Comcast is sticking to a strict cable model for delivering pay TV services, satellite operator Dish might be more open to offering an online version of its pay TV product. On the company’s fourth quarter earnings call last week, Dish CEO Charlie Ergen told investors that Dish was talking to cable networks about acquiring rights for a streaming offering. At the same time, Ergen noted that programmers had to be careful of undervaluing their content by making it available online.

“My gut feeling is that some programmers will grant some over-the-top Internet rights and probably undermine their core business. I think Starz probably is a good example where they sold some over-the-top rights fairly expensively and we know that, that’s hurt our Premium business for them, far more than they’re getting paid for it.”

Starz famously licensed much of its programming to Netflix for $25 to $30 million a year, helping the subscription DVD rental firm to grow into the streaming powerhouse it is today. Those kinds of mistakes will be made, Ergen said, but the hope is that programmers don’t “take too much money out of the ecosystem while [they're] figuring it out.” At the same time, Dish needs to remain ahead of the curve or risk losing out to more secular trends. Ergen cited the wireline phone business as one that didn’t adapt when wireless came along:

“[i]f you were in the phone business and wireless came along and you kept on putting in a twisted pair of lines, that was still a good business for another 10 years, 15 years, but at some point that wasn’t a very good business. So I’d rather be on the leading edge of that than the back end of it.”
http://gigaom.com/video/comcast-dish-streaming/

Boxee Raises $16.5 Million For Its Vision For The “Future Of TV”
Robin Wauters

Boxee has announced on its blog that it has raised $16.5 million in third-round funding. This brings the total capital raised by the company to $26.5 million.

The investment comes from new investors Pitango and Softbank, with participation from prior backers General Catalyst, Spark Capital and Union Square Ventures.

Boxee points out it has grown from 12 to 34 employees since its last ($6 million) round of funding, and that it plans on hiring some more.

The extra capital will be used to enhance its software, solve bugs and build new functionality into their product(s). In the company’s words:

One of our greatest challenges will be to add more movies, TV shows, and video while at the same time making it easier to discover and watch them. We have ideas on both fronts and are excited to get to work.Many of you would like to see Boxee handle all the video on their TV with no need to switch inputs. We’d like to get there, too.

In addition to product enhancements, the funding will be used to strike more content and hardware manufacturer partnerships.
http://techcrunch.com/2011/03/01/box...-future-of-tv/

Nobutoshi Kihara, Sony Engineer, Dies at 84
Douglas Martin

Nobutoshi Kihara, the engineer known as “the wizard of Sony” for his ingenuity in developing products, like Japan’s first tape recorder and transistor radio, and later the Betamax videocassette recorder, that helped propel the company’s rise from the ashes of war to become a global electronics giant, died on Feb. 13. He was 84.

Howard Stringer, chairman of the Sony Corporation, announced the death in an internal memorandum. Mr. Kihara is believed to have died in Tokyo, Sandra Genelius, a Sony spokeswoman, said.

“Sony’s audio and video technologies are only in existence today because of the technical foundations laid down by Mr. Kihara,” Mr. Stringer wrote.

Mr. Kihara, whose innovations helped win more than 700 patents, led in developing products like the company’s first success, a magnetic tape recorder and the magnetic tape to go with it. Other products included the transistor radio and television, one of the world’s first videotape recorders, the Betamax, eight-millimeter video movies, the digital still camera known as Mavica and a catalog of smaller and lighter variations of these products.

Though Mr. Kihara was widely known as “Mr. Walkman,” another engineer actually created the world’s first commercial personal stereo system. But Mr. Kihara’s earlier innovations provided the backbone for the Walkman. Akio Morita, one of Sony’s two founders, had asked Mr. Kihara, then a top engineering executive, to find a way for him to listen to operas on long-haul business flights.

It was Mr. Kihara’s relationship with Sony’s other founder, Masaru Ibuka, that rained magic. Projects usually began with a rambling, almost telepathic conversation in which Mr. Ibuka was careful not to offend Mr. Kihara by issuing a direct order. Often as soon as the next day Mr. Kihara would delightedly show Mr. Ibuka a prototype of the concept they had discussed, John Nathan wrote in “Sony: The Private Life” (1999).

“I loved making him happy,” Mr. Kihara said. In turn, Mr. Ibuka referred to Mr. Kihara as “a godlike person” in one of his books.

Nobutoshi Kihara was born in Tokyo on Oct. 14, 1926. His family had a background in engineering, and as a boy he enjoyed dissecting the motor of his model train locomotive. To pay university tuition, he retrieved discarded radios and fixed them.

In 1947, as he was preparing to graduate from Waseda University in Tokyo, he responded to an employment advertisement on a bulletin board placed by the Tokyo Telecommunications Engineering Company, which would become Sony.

Mr. Kihara’s exuberance about electronics — and experience repairing and building radios — wiped out concerns that his background was in mechanical, rather than electrical, engineering. His first major product was the development of a tape recorder: he heated ground iron in a frying pan to collect the ferric oxide he needed to make magnetic tape.

A shortage of court stenographers created an immediate market for the recorders. He kept developing smaller and smaller models.

Mr. Ibuka came up with the idea of using transistors in radios. Mr. Kihara produced one, and in August 1955 the first transistor radio in Japan went on sale. An American company called Regency, using Texas Instruments transistors, beat Sony to the market by a month, making Sony’s the second in the world.

Sony’s transistor radio was immediately profitable. Mr. Kihara then found ways to use transistors in television sets and tape recorders, making miniaturization and lower power consumption easier.

He led Sony’s advance into videotape recorders and then to videocassette recorders. His Betamax lost out to the VHS, made by Matsushita (whose best known brand is Panasonic), which was cheaper and could fit more programming on a tape.

Mr. Kihara, who is survived by his wife and three children, always insisted that Betamax’s technology was superior to that of rivals who had used it as a model. “My blood boils,” he said of VHS’s victory over Betamax.

Mr. Kihara once said he could close his eyes and imagine new products.

“Anyone can find out the common sense things, and my role is not to teach common sense,” he said in a 1994 oral history for the Center for the History of Electrical Engineering “My message has always been to break through what is common sense and common knowledge and make the impossible possible.”
http://www.nytimes.com/2011/02/28/te.../28kihara.html

Harman Declines on Social Media Car App

Harman International Industries Inc., a Stamford-based maker of audio and infotainment equipment, has teamed with Swiss car manufacturer Rinspeed to create the "world's first social networking vehicle" by installing its GreenEdge energy efficient audio solutions and Halosonic technologies for electric vehicles into the Rinspeed BamBoo electric concept car. Harman's infotainment head unit includes its Aha Radio application, which translates text-based digital content to voice and plays it back in the car, making driving safer and more comfortable. With Aha Radio, drivers and passengers can monitor traffic, hear Twitter and Facebook updates, play podcasts from their favorite channels, or listen to streaming music via the Internet or satellite.

Harman went down 31 cents to close at $48.64. (3/1/11)
http://www.newstimes.com/business/ar...pp-1035319.php

Average Broadband Speeds 'Less Than Half Those Advertised', Says Ofcom

Britons get average broadband speed of 6.2 megabits per second, less than half average advertised speed of 13.8Mb
Josh Halliday

Millions of broadband customers are being sold super-fast connections that their internet providers are unable to deliver, according to new research.

Data released by Ofcom, the communications watchdog, shows that the average broadband speed is still less than half of the average advertised speed.

The report, published on Wednesday, says that Britons get an average broadband speed of 6.2 megabits per second (Mbps) – less than half the average advertised speed of 13.8Mb.

Ofcom is pushing for a change in the way internet providers, including BT, Sky and O2, advertise "up to" broadband speeds, which most customers are unable to receive.

Its findings will feed into a consultation now underway by the Advertising Standards Authority's committee of advertising practice (CAP) and broadcast committee of adverting practice (BCAP) into how broadband speeds are advertised. That is expected to report in the next three months.

"The research shows that ISPs need to do more to ensure they are giving customers clear and accurate information about the services they provide and the factors that may affect the actual speeds customers will receive," said Ed Richards, Ofcom's chief executive.

"It is important that the rules around broadband advertising change, so that consumers are able to make more informed decisions based on the adverts they see, and that advertisers are able to communicate more clearly how their products compare to others in the market."

Ofcom carried out performance tests in 1,700 homes across the UK in November and December last year. The report is based on 11 broadband packages from the UK's seven largest providers, including Virgin Media and TalkTalk.

The growing demand for faster broadband packages has led ISPs to advertise maximum speeds, despite current infrastructure being unable to support them. The only ISP delivering close to the maximum speed advertised, according to Ofcom, was Virgin Media, with the advantage of a relatively new cable network in many urban areas.

The typical broadband speed received by customers was much closer to the advertised speed with fibre-optic cable packages, such as the those delivered by Virgin Media and BT's Infinity package. However, only 22% of Britons have fibre-optic connections, with 77% of the population using copper-based DSL phone lines.

The greatest disparity in advertised and delivered broadband speeds came with "up to" 20Mbps connections delivered over the current-generation DSL lines. Only 3% of customers with this package received an average speed close to 20Mbps, with 69% receiving an average speed of less than 8Mbps.

The overall average broadband speed increased from 5.2Mbps in May last year to 6.2Mbps in December, the report shows, meaning a typical five-minute song would take just under four seconds to download, compared with just over five seconds on the slower speed.

Ofcom recommends that broadband speeds should be advertised on a "typical speeds range" – the speed which customers can expect to receive. The regulator says typical speeds must "have at least equal prominence" to headline speeds, and that maximum speeds must only be advertised "if it is actually achievable in practice by a material number of consumers".

Under Ofcom's recommendations, ISPs advertising DSL connections of "up to" 8Mbps – the service used by the majority of Britons – would be forced to reveal that the typical speed is in reality between 2Mbps and 5Mbps.

However, BT said it had "real concerns" with Ofcom's approach. "Moving to typical speed ranges will potentially be highly misleading as the average performance will vary depending on where people live," said John Petter, the managing director BT Retail's consumer business. "Enforcing typical speed ranges is also dangerous as it could encourage more ISPs to cherry pick customers who will increase their average, leaving customers in rural and suburban areas under-served. That would encourage digital exclusion rather than tackle it."

Sky said the debate about headline speeds had the potential to be a "red herring", given that existing Ofcom guidelines state that providers must give customers individual speed estimates at the point of sale.

Jon James, executive director of broadband at Virgin Media, described the report as "yet another damning indictment that consumers continue to be treated like mugs and misled by ISPs that simply cannot deliver on their advertised speed claims".
http://www.guardian.co.uk/technology...ertising-ofcom

Cheap, Ultrafast Broadband? Hong Kong Has It
Randall Stross

HONG KONG residents can enjoy astoundingly fast broadband at an astoundingly low price. It became available last year, when a scrappy company called Hong Kong Broadband Network introduced a new option for its fiber-to-the-home service: a speed of 1,000 megabits a second — known as a “gig” — for less than $26 a month.

In the United States, we don’t have anything close to that. But we could. And we should.

Verizon, the nation’s leading provider of fiber-to-the-home service, doesn’t offer a gig, or even half that speed. Instead, it markets a “fastest” service that is only 50 megabits a second for downloading and 20 megabits a second for uploading. It costs $144.99 a month. That’s one-twentieth the speed of Hong Kong Broadband’s service for downloading, for more than five times the price.

One thing working in Hong Kong’s favor, of course, is its greater population density, enabling broadband companies to reach multiuser dwellings at a much lower cost. But density is only part of the explanation. The personality of Hong Kong Broadband should be noted, too. A wholly owned subsidiary of City Telecom, it is an aggressive newcomer. It was willing to suffer seven years of losses while building out its fiber network before it turned profitable.

Hong Kong Broadband’s principal competitor is an older company, PCCW, which has several other lines of business, including phone, television and mobile. PCCW also offers gigabit service to the home and benefits from the same population density. But PCCW’s price is more than twice as much as Hong Kong Broadband’s. Despite its low prices, Hong Kong Broadband now operates in the black.

Inexpensive pricing of gigabit broadband is practical in American cities, too. “This is an eminently replicable model,” says Benoit Felten, a co-founder of Diffraction Analysis, a consulting business based in Paris. “But not by someone who already owns a network — unless they’re willing to scrap the network.”

In the United States, costs would come down if several companies shared the financial burden of putting fiber into the ground and then competed on the basis of services built on top of the shared assets. That would bring multiple competitors into the picture, pushing down prices. But it would also require regulatory changes that the Federal Communications Commission has yet to show an appetite for.

Dane Jasper, the chief executive of Sonic.net, an Internet provider based in Santa Rosa, Calif., says that most broadband markets in the United States today are dominated by one phone company and one cable company.

“Why doesn’t Verizon offer gigabit service?” Mr. Jasper asks. “Because it doesn’t have to.”

In its earnings report for the quarter ended Dec. 31, Verizon said its fiber-based Internet service, which serves 12 states and the District of Columbia, was available to 12.8 million premises, an increase of 10 percent from the previous year.

When I asked about its lack of gig service, C. Lincoln Hoewing, Verizon’s assistant vice president for Internet and technology issues, said, “We already offer 150 megabits,” referring to a tier of fiber-based service that is marketed for $195 a month to small businesses in many of its markets. It “seems to be satisfying demand,” he said.

In a follow-up e-mail, a Verizon spokeswoman addressed the company’s lack of a gig service by saying that it offers “speeds that exceed what customers can and do use.”

As long as a gig is expensive, a lack of customer interest shouldn’t be surprising. In October, EPB, the municipal electric utility in Chattanooga, Tenn., introduced a gig option in its fiber-to-the-home Internet services. A spokeswoman said the option, which costs $349.99 a month, currently has only about 20 customers.

It is true that residential customers would now be hard-pressed to fully use anything close to a gig. Uncompressed, broadcast-quality HD video, for example, uses 23 megabits a second.

But it is possible to imagine situations — a doctor’s office consultation, say, involving specialists scattered around the country, poring over the patient and her cerebral angiogram simultaneously — where multiple, two-way video feeds could chew up a lot of bandwidth. All parties would need the ultrafast connections. But that level of capacity seems distant because each party needed to make it happen — customers, software developers and Internet providers — is waiting for the others to show up first.

GOOGLE doesn’t want to wait. It and Sonic.net are preparing an experimental deployment of gigabit service to 850 faculty and staff homes in a Stanford University subdivision.

Separately, Google plans to select one or several cities where it will offer gigabit service at what it calls “a competitive price” to at least 50,000, and potentially 500,000, people. In a post on the company blog titled “Think Big With a Gig,” it says, “We want to see what developers and users can do with ultra-high speeds, whether it’s creating new bandwidth-intensive ‘killer apps’ and services, or other uses we can’t yet imagine.”

Mr. Jasper of Sonic.net says the history of computing shows us that “no matter how much storage we have or how fast the computing processing speed or network connection speed, applications arise to utilize them.”

While companies like Verizon don’t seem to be in a rush, that little Hong Kong business is saying: A gig? Sure. Join this grand experiment early. At $26 a month, it’s a low-cost ticket to the future.
https://www.nytimes.com/2011/03/06/business/06digi.html

Remapping Computer Circuitry to Avert Impending Bottlenecks
John Markoff

Hewlett-Packard researchers have proposed a fundamental rethinking of the modern computer for the coming era of nanoelectronics — a marriage of memory and computing power that could drastically limit the energy used by computers.

Today the microprocessor is in the center of the computing universe, and information is moved, at heavy energy cost, first to be used in computation and then stored. The new approach would be to marry processing to memory to cut down transportation of data and reduce energy use.

The semiconductor industry has long warned about a set of impending bottlenecks described as “the wall,” a point in time where more than five decades of progress in continuously shrinking the size of transistors used in computation will end. If progress stops it will not only slow the rate of consumer electronics innovation, but also end the exponential increase in the speed of the world’s most powerful supercomputers — 1,000 times faster each decade.

However, in an article published in IEEE Computer in January, Parthasarathy Ranganathan, a Hewlett-Packard electrical engineer, offers a radical alternative to today’s computer designs that would permit new designs for consumer electronics products as well as the next generation of supercomputers, known as exascale processors.

Today, computers constantly shuttle data back and forth among faster and slower memories. The systems keep frequently used data close to the processor and then move it to slower and more permanent storage when it is no longer needed for the ongoing calculations.

In this approach, the microprocessor is in the center of the computing universe, but in terms of energy costs, moving the information, first to be computed upon and then stored, dwarfs the energy used in the actual computing operation.

Moreover, the problem is rapidly worsening because the amount of data consumed by computers is growing even more quickly than the increase in computer performance.

“What’s going to be the killer app 10 years from now?” asked Dr. Ranganathan. “It’s fairly clear it’s going to be about data; that’s not rocket science. In the future every piece of storage on the planet will come with a built-in computer.”

To distinguish the new type of computing from today’s designs, he said that systems will be based on memory chips he calls “nanostores” as distinct from today’s microprocessors. They will be hybrids, three-dimensional systems in which lower-level circuits will be based on a nanoelectronic technology called the memristor, which Hewlett-Packard is developing to store data. The nanostore chips will have a multistory design, and computing circuits made with conventional silicon will sit directly on top of the memory to process the data, with minimal energy costs.

Within seven years or so, experts estimate that one such chip might store a trillion bytes of memory (about 220 high-definition digital movies) in addition to containing 128 processors, Dr. Ranganathan wrote. If these devices become ubiquitous, it would radically reduce the amount of information that would need to be shuttled back and forth in future data processing schemes.

For years, computer architects have been saying that a big new idea in computing was needed. Indeed, as transistors have continued to shrink, rather than continuing to innovate, computer designers have simply adopted a so-called “multicore” approach, where multiple processors are added as more chip real estate became available.

The absence of a major breakthrough was referred to in a remarkable confrontation that took place two years ago during Hot Chips, an annual computer design conference held each summer at Stanford University.

John L. Hennessy, the president of Stanford and a computer design expert, stood before a panel of some of the world’s best computer designers and challenged them to present one fundamentally new idea. He was effectively greeted with silence.

“What is your one big idea?” he asked the panel. “I believe that the next big idea is going to come from someone who is considerably younger than the average age of the people in this room.”

Dr. Ranganathan, who was 36 at the time, was there. He said that he took Dr. Hennessy’s criticism as an inspiration for his work and he believes that nanostore chip design is an example of the kind of big idea that has been missing.

It is not just Dr. Hennessy who has been warning about the end the era of rapidly increasing computer performance. In 2008, Darpa, the Defense Advanced Research Projects Agency assembled a panel of the nation’s best supercomputer experts and asked them to think about ways in which it might be possible to reach an exascale computer — a supercomputer capable of executing one quintillion mathematical calculations in a second, about 1,000 times faster than today’s fastest systems.

The panel, which was led by Peter Kogge, a University of Notre Dame supercomputer designer, came back with pessimistic conclusions. “Will the next decade see the same kind of spectacular progress as the last two did?” he wrote in the January issue of IEEE Spectrum. “Alas, no.” He added: “The party isn’t over, but the police have arrived and the music has been turned way down.”

One reason is computing’s enormous energy appetite. A 10-petaflop supercomputer — scheduled to be built by I.B.M. next year — will consume 15 megawatts of power, roughly the electricity consumed by a city of 15,000 homes. An exascale computer, built with today’s microprocessors, would require 1.6 gigawatts. That would be roughly one and half times the amount of electricity produced by a nuclear power plant.

The panel did, however, support Dr. Ranganathan’s memory-centric approach. It found that the energy cost of a single calculation was about 70 picojoules (a picojoule is one millionth of one millionth of a joule. The energy needed to keep a 100-watt bulb lit for an hour is more than eight million joules). However, when the energy costs of moving the data needed to do a single calculation — moving 200 bits of data in and out of memory multiple times — the real energy cost of a single calculation might be anywhere from 1,000 to 10,000 picojoules.

A range of other technologies are being explored to allow the continued growth of computing power, including ways to build electronic switches smaller than 10 nanometers — thought to be the minimum size for current chip-making techniques.

Last month, for example, researchers at Harvard and Mitre Corporation reported the development of nanoprocessor “tiles” based on electronic switches fabricated from ultrathin germanium-silicon wires.

I.B.M. researchers have been pursuing so-called phase-change memories based on the ability to use an electric current to switch a material from a crystalline to an amorphous state and back again. This technology was commercialized by Samsung last year. More recently, I.B.M. researchers have said that they are excited about the possibility of using carbon nanotubes as an a partial step to build hybrid systems that straddle the nanoelectronic and microelectronic worlds.

Veteran computer designers note that whichever technology wins, the idea of moving computer processing closer to memory has been around for some time, and it may simply be the arrival of nanoscale electronics that finally makes the new architecture possible.

An early effort was called iRAM, in a research project at the University of California, Berkeley, during the late 1990s. Today pressure for memory-oriented computing is coming both from computing challenges posed by smartphones and from the data center, said Christoforos Kozyrakis, a Stanford University computer scientist who worked on the iRAM project in graduate school.
http://www.nytimes.com/2011/03/01/sc...01compute.html

Supreme Court Rejects AT&T Corporate Privacy Rights
James Vicini

AT&T Inc and other corporations do not have personal privacy rights to prevent disclosure of federal government records about them, the Supreme Court ruled on Tuesday.

The justices unanimously overturned a ruling by a U.S. appeals court for the telecommunications company that corporations can assert personal privacy in claiming the records should be exempt from disclosure.

The high court, in an opinion written by Chief Justice John Roberts, agreed with the Obama administration's argument that the personal privacy exemption under the Freedom of Information law applied only to individuals, not to corporations.

Public interest groups supported the government.

They said that under AT&T's position, government records could be withheld about coal mine safety violations, offshore oil rig problems, dirty conditions at food manufacturing plants and questionable investment bank financial dealings.

Business groups supported AT&T and said corporations have long enjoyed a range of rights, including privacy rights.

AT&T argued the Federal Communications Commission should keep secret all records about it during an investigation into its participation in the federal E-Rate program, which helps schools and libraries get Internet access.

AT&T told the FCC in 2004 that an internal investigation had revealed certain irregularities in the company's billings to a Connecticut school under the program.

AT&T To Pay $500,000

The FCC launched an investigation that led to a December 2004 settlement in which AT&T agreed to pay $500,000 and to adopt a two-year compliance program.

CompTel, a trade association representing some of AT&T's competitors, requested all records in the FCC's file under the Freedom of Information Act.

The FCC decided to release some of the records, but AT&T said that disclosing any information violated its right to personal privacy, and the appeals court agreed.

Roberts in the Supreme Court's opinion overturned that decision.

He said the word personal ordinarily referred to individuals and dictionary definitions also suggested that it does not usually relate to corporations. Roberts said AT&T provided scant support that personal denoted corporations.

The Supreme Court case is FCC v. AT&T, No. 09-1279.

(Reporting by James Vicini; Editing by Gerald E. McCormick and Maureen Bavdek)
http://www.reuters.com/article/2011/...7203UN20110301

Did Google Pre-Emptively Block a 4G iPhone on Verizon?
Ryan Singel

In 2008, after much protest, Verizon accepted openness conditions attached to valuable spectrum being auctioned off by the FCC, and spent $4.7 billion to buy nationwide capacity that would ensure it could build a robust 4G network for the next generation of mobile devices.

But in doing so, Verizon may have screwed itself out of ever being able to offer a 4G-capable iPhone.

The problem is that the “open access” rules attached to the so-called 700 Mhz C block require the carrier to allow the use of any hardware or software that it can’t prove won’t damage the network.

The rules were inserted at the behest of Google, which was bidding for the spectrum but who some cynics contended got involved not to win but to ensure that whoever got the spectrum couldn’t hamper its business, which requires a free and robust internet.

Google’s idea was to create an open space for innovation where a person could buy any device (including one from Google) and run any app that met open standards with no interference by the carrier.

And depending upon how you interpret the rules, which Verizon fought in court before the auction, they also required that the wireless carrier only offer devices that are open and able to run any app. That interpretation would clearly rule out the iPhone, which is locked down by design, and only apps approved by Apple can be loaded onto the device without breaking the device’s warranty.

That’s how Markham Erickson, a technology lawyer and the executive director of the Open Internet Coalition, sees it.

“The interpretation that the rules would ensure all handsets sold by the licensee would be unlocked was the clear intent from Chairman Martin at the time,” Markham said, referring to Kevin Martin, the Republican who headed the FCC at the time the auction rules were set.

When Martin testified to Congress about the provision, Martin made it clear that that “this condition means all handsets will be unlocked and open to all apps,” according to Markham.

Penn State University professor of law and technology Robert Frieden also thinks Verizon might find itself in a pickle.

“I would think the requirement would apply to any device Verizon marketed using that spectrum,” Frieden told Wired.com.

Verizon told the FCC it thinks the rules mean that it has to allow any third-party app or device that doesn’t harm the network, but that it can sell restricted devices and restrict apps on those devices.

As the company said in a September 2007 letter to the FCC: “Verizon Wireless’s position [is] that the Commission should not force C-block licensees to allow any and all lawful applications to be downloaded to any devices that licensees provide, including devices that are not configured to accommodate any and all applications.”

That’s not how Google interprets the rule, according to a 2008 filing calling on the FCC to make sure Verizon follows the rules.

The Commission’s open access rule is clear that C Block licensees “shall not deny, limit, or restrict the ability of their customers to use the devices and applications of their choice….” The rule thus plainly proscribes a C Block licensee from selling handsets to customers that hinder a customer’s ability to use applications of their choice, and applies to all customers of a C Block licensee.

Verizon’s position would completely reverse the meaning of the rule such that the open access condition would apply to none of Verizon’s customers, and thereby render the condition a nullity.

The FCC decided to impose rules on the 700 Mhz block after noting that carriers had blocked applications and crippled devices — such as turning off their WiFi chips or disabling Bluetooth, something Verizon used to be notorious for.

“Although wireless broadband services have great promise, we have become increasingly concerned that certain practices in the wireless industry may constrain consumer access to wireless broadband networks and limit the services and functionalities provided to consumers by these networks,” the FCC said in a 350-page ruling on the auction.

“Specifically, a C Block licensee may not block, degrade, or interfere with the ability of end users to download and utilize applications of their choosing on the licensee’s C Block network, subject to reasonable network management,” the FCC continued.

Currently, Verizon is in the clear, despite having recently landed the iPhone. The company boasts that it’s LTE network (a form of 4G) is the “fastest and most advanced,” but all of the phones it currently offers for use on that network are Android devices — which allow a user to easily install any app they like, whether its in Google’s only slightly curated market or not.

Verizon has also set up a portal to help developers who wish to create devices or apps that will run on its LTE network and has a certification program.

In retrospect, the rules seem almost superfluous, thanks to Android’s stunning inroads into the smart phone market and in part, because Google’s dream of selling an open handset directly to consumers died not long after birth. But the open-source OS has allowed AT&T’s competitors to offer smart phones that rival the iPhone, creating an explosion in Android devices from manufacturers including Motorola, Samsung and HTC.

That development led Google and Verizon growing closer thanks to Verizon’s embrace of the Android OS as a way to compete with AT&T’s exclusive lock on the iPhone, and the two even came up with a “compromise” net neutrality proposal last summer.

But that new-found friendship might be tested if the 4G spectrum rules Google pushed end up blocking Verizon from launching a 4G iPhone.

Google declined to comment on how it interprets the rules now.

When asked, Verizon spokeswoman Brenda Boyd Raney said “I couldn’t speculate on that since an LTE iPhone doesn’t exist.”

Verizon may have some time to mull its options or even go back to court to get the rules thrown own, as Apple tends to wait to adopt the latest innovations in wireless spectrum until the technology matures so it’s unlikely that the 2011 version of the iPhone will be 4G. That means it’s likely that Verizon won’t have to face this tough problem until June of 2012.

But in the meantime, lawyers will be very busy trying to figure out possible loopholes, according to Penn State’s Friedan.

“Lawyers get paid lots of money to think cleverly and then talk to engineers to configure the phone to do that,” Friedan said.

Markham suggests lots of people in the tech world will be trying to figure this out as well.

“I don’t think there’s any kind of resolution around whether Verizon could sell a 4G iPhone,” Markham said. “We will have to wait to see. We will see a collective scratching of the head.”
http://www.wired.com/epicenter/2011/...ne-block/all/1

Infected Android App Runs Up Big Texting Bills

Hackers up ante by adding more malicious 'features' to legitimate smartphone apps, says Symantec
Gregg Keizer

A rogue Android app that's been tweaked by hackers can hijack a smartphone and run up big texting bills before the owner knows it, Symantec said today.

The newest in a line of compromised Android apps, said Vikram Thakur, a principle security response manager at Symantec, is Steamy Window, a free program that Chinese hackers have modified, then re-released into the wild.

The cyber criminals grabbed a copy of Steamy Windows, then added a backdoor Trojan horse - "Android.Pjapps" by Symantec's label -- to the app's code. The reworked app is then placed on unsanctioned third-party "app stores" where unsuspecting or careless Android smartphones find it, download it and install it.

"This one stands out," said Thakur on Monday. "It's pretty comprehensive in what it's doing."

The Trojan planted by the malware-infected Steamy Windows can install other applications, monkey with the phone's browser bookmarks, surreptitiously navigate to Web sites and silently send text messages, said Thakur.

The last is how the criminals make money.

"The Trojan lets them send SMS [short message service] messages to premium rate numbers," said Thakur, for which the hackers are paid commissions.

Android.Pjapps also has a built-in filter that blocks incoming texts from the user's carrier, a trick it uses to keep victims in the dark about the invisible texting.

"It monitors inbound SMS texts, and blocks alerts telling you that you've already exceeded your quota," Thakur said. Smartphone owners then wouldn't be aware of the charges they've racked up texting premium services until they receive their next statement.

Symantec found the cloned Steamy Windows app on a Web site hosted by Chinese servers.

The practice of altering legitimate Android apps to carry malware isn't new -- earlier this year, security experts warned that Monkey Jump was being cloned by criminals for the same purpose -- but the bogus Steamy Window app shows that hackers are getting better at reworking mobile software.

"The code inside [Steamy Windows] can be easily added to other apps," said Thakur today. "For someone who knows what they're doing -- and it seems these people have a good understanding of how apps are coded -- I'd put this in the 'trivial to do' category. The last few months, it seems to be ramping up."

Android smartphones are an attractive target for hackers, Thakur continued, because of their increasing popularity and because, unlike Apple's iOS, users can install apps downloaded from third-party distribution sites.

"Where there's honey, there's bees," said Thakur.

Smartphone owners should be wary of unauthorized app stores, Thakur said. "Downloading an app from one of these [third-party] sites is like downloading a Windows app from a 'warez' site," he said, referring to sites that post illegally-obtained content, which often is malware infected.

"And if you're hell-bent on using them, look at the permissions the app requests when it installs. A [rogue] app will request more permissions than the legitimate version," he said.

Symantec published an analysis of Android.Pjapps on its Web site Monday.

The legitimate Steamy Window app for Android can be downloaded from Google's Android Market.
http://www.computerworld.com/s/artic..._texting_bills

Google Pulls 21 Apps in Android Malware Scare
Jolie O'Dell

Google has just pulled 21 popular free apps from the Android Market. According to the company, the apps are malware aimed at getting root access to the user's device, gathering a wide range of available data, and downloading more code to it without the user's knowledge.

Although Google has swiftly removed the apps after being notified (by the ever-vigilant "Android Police" bloggers), the apps in question have already been downloaded by at least 50,000 Android users.

The apps are particularly insidious because they look just like knockoff versions of already popular apps. For example, there's an app called simply "Chess." The user would download what he'd assume to be a chess game, only to be presented with a very different sort of app.

These apps are all pirated versions of popular games and utilities -- an expeditious solution for busy hackers.

Once downloaded, the apps root the user's device using a method like rageagainstthecage, then use an Android executable file (APK) to nab user and device data, such as your mobile provider and user ID. Finally, the app acts as a wide-open backdoor for your device to quietly download more malicious code.

Below is a partial list of the bad apps, all of which were made by an entity called Myournet.

If you've downloaded one of these apps, it might be best to take your device to your carrier and exchange it for a new one, since you can't be sure that your device and user information is truly secure.

Considering how much we do on our phones -- shopping and mobile banking included -- it's better to take precautions.

Falling Down

Super Guitar Solo

Super History Eraser

Photo Editor

Super Ringtone Maker

Super Sex Positions

Hot Sexy Videos

Chess

Hilton Sex Sound

Screaming Sexy Japanese Girls

Falling Ball Dodge

Scientific Calculator

Dice Roller

Advanced Currency Converter

APP Uninstaller

Funny Paint

Spider Man

Remember, the Android Market is open, which can be great and unfortunate in different circumstances. Always read user reviews before you download; and if you have any doubts, play it safe.
http://www.cnn.com/2011/TECH/mobile/...lware.andriod/

Beijing to Track Citizens with Their Cell Phones

As if the Great Firewall is not enough, the Chinese government is now looking into monitoring the movement of 17 million cellphone users in Beijing, China by tracking the signal of their mobile devices.

Purportedly to improve Beijing’s public travel and reduce traffic congestion, the new initiative, literally translated as “Platform for Citizen Movement Information” proposes to track each individual citizen’s movement in real time via cell phone signals, as reported on the Beijing Municipal People’s Government website.

Li Guoguang, Deputy Director of Social Development believes that cellular location technology for real-time user tracking is an efficient way to establish a public information platform for travelling. Whenever a user switches on their phone, it will automatically transmit signals to the base station and the government can easily determine the user’s location and general direction. Using this data, combined with dynamic analysis, the staff will be able to target specific areas at different times and track the general flow of travel and population distribution.

Li Guoguang added that the next step is to provide the public with personalized reports so that they can be aware of the city’s traffic congestion and thereby choose the best alternate way to travel.
http://thenextweb.com/asia/2011/03/0...r-cell-phones/

Sen. Schumer Calls for Increased Public WiFi Security

Sen. Charles Schumer on Sunday called on major U.S. web site operators such as Amazon and Twitter to switch to a more secure protocol to prevent identify theft and other security breaches in places like coffee shops.

The New York Democrat told a news conference held at a Manhattan coffee shop that growing WiFi access at such shops, restaurants and other businesses was helping hackers gain user information like credit card numbers and account passwords.

"The number of people who use WiFi to access the Internet in coffee shops, bookstores and beyond is growing by leaps and bounds," Schumer said.

Unsuspecting patrons using their computers in such public venues had made them easy prey for hackers and identity thieves, he said.

"The quickest and easiest way to shut down this one-stop shop for identity theft is for major Web sites to switch to secure HTTPS web addresses instead of the less secure HTTP protocol," Schumer said.

He called the HTTP protocol "a welcome mat for would-be hackers."

Schumer said simple programs such as Firesheep had made accessing someone else's computer and private information through the unsecured HTTP extension relatively easy.

Schumer said many major Web site operators have been slow to address the HTTP security flaw, which he said has been well recognized since at least 2007.

He also released a letter to major Web site operators, none of which he said use HTTPS protocol as the default, asking them make the change.

(Reporting by Chris Michaud. Editing by Peter Bohan)
http://www.reuters.com/article/2011/...71Q2N420110228

The Footprints of Web Feet
Austin Considine

SHARING and communicating are essential components of being human. But as celebrities like Britney Spears and Charlie Sheen have shown us lately, there is such a thing as over-sharing.

Still a new generation of Web sites like Dscover.me, Sitesimon.com and Voyurl.com is banking on our willingness to take that next step toward taking our lives public: namely, by automatically tracking personal browsing histories for public viewing.

Paul Jones, a founder of Dscover.me, said he and his founding partner conceived the site because they were old college friends and wanted a way to better share common interests, from shopping finds to tech news, while living in different parts of the country.

At times, their communication would drop off, Mr. Jones said. “Then, at one point we just said to each other, ‘What if we could just show each other what we’re reading and watching and shopping for?’ ”

But are these sites another crack in the eroding wall between public and private life?

Perhaps. The better question: Do we actually care if they are? As Mr. Jones noted, Facebook’s News Feed, the feature that lets users easily track friends’ activity in one place, was somewhat controversial when it was introduced in 2006.

“Obviously, now, it’s completely accepted and people who are younger, in particular, just accept it that their lives are completely open,” Mr. Jones said. (The jury is still assembling for these sites: Dscover.me has been open to everyone since November; Sitesimon and Voyurl are accepting users on a rolling basis, but will open fully in the coming months.)

Controversy is, of course, part of the appeal. Sharing feels a little risky, and entire Nevada cities are built atop the inescapable truth that risk can be fun. On the consumer end, it’s also fun to spy and is a great way to find content and see what’s trending.

Yet it’s hard to imagine anyone choosing to share one’s entire browsing history. There are the obvious “me time” indulgences that want hiding. But what about researching an embarrassing ailment? What about online dating, or banking?

At all of these tracking sites, developers say they take privacy very seriously; their success will ultimately be predicated on trust. Therefore, they have created numerous safeguards. None of them share links to secure sites, for example; tracking software can be turned off at will.

Dscover.me has what’s called a “white list” among its protections. As people browse, only links to an evolving list of approved sites are shared.

Steven Gutentag, a founder of Sitesimon, said his team decided to take the opposite approach: His site uses the more familiar black list to protect its users from over-sharing.

It’s not just a matter of logistics. Mr. Gutentag said his choice was more philosophical.

“A lot of discoveries as we go through the Web are serendipitous,” he said. “You visit the same couple of sites in general, but then you click off and go to another one. You don’t want to have to add that to the white list for that to be shared.”

All that sharing can open up new and tricky fields of interplay in relationships. Mina Tsay, a communications professor at Boston University who studies the psychological and social effects of media, said that in her studies of Facebook she found that frequent users saw the world as significantly more public than less-frequent users did — a source of misunderstanding familiar to many social media users.

Privacy notwithstanding, Dr. Tsay said social media’s evolution might create more-passive consumers of information: people too reliant on others to decide what’s interesting, stylish or valuable.

“In some ways, this might produce a society in which we end up conforming to buying the same products, seeing the same information, going on the same trip, depending on the same sources,” she said.

Others argue that such sites will make us less passive by making us more aware of how we behave online. Adam Leibsohn, founder of Voyurl, whose playfully sinful slogan is “It’s O.K. to look,” said that is a good thing, especially because other sites already track browsing habits to sell as marketing data.

“If we’re not following you, no matter what, somebody else is,” he said. “The difference in this scenario is, we show it back to you. It’s holding up a mirror to a reflection that I don’t think people knew they had.”
https://www.nytimes.com/2011/03/06/f...06Sharing.html

SSD Firmware Destroys Digital Evidence, Researchers Find

Forensic analysis of drives by investigators now uncertain
John E Dunn

A technology built into many new solid state drives (SSDs) to improve their storage efficiency could inadvertently be making forensic analysis at a later date by police forces and intelligence agencies almost impossible to carry out to legally safe standards, researchers have discovered.

The detailed findings contained in Solid State Drives: The Beginning of the End for Current Practice in Digital Forensic Discovery? by Graeme B. Bell and Richard Boddington of Murdoch University in Perth, Australia, will make unsettling reading for professionals in the digital forensics field and beyond.

After conducting a series of experiments comparing a sample Corsair 64GB SSD with a conventional Hitachi 80GB magnetic hard drive (HDD), the team found a layer cake of data recovery problems caused by the ‘garbage collection’ or purging algorithms used in SSDs to keep them at peak performance.

After examining an SSD for traces of data after it had been quick formatted, the team expected the purging routines to kick in around 30-60 minutes later, a process that must happen on SSDs before new data can be written to those blocks. To their surprise, this happened in only three minutes, after which only 1,064 out of 316,666 evidence files were recoverable from the drive.

Going a stage further, they removed the drive from the PC and connected a ‘write blocker’, a piece of hardware designed to isolate the drive and stop any purging of its contents. Incredibly, after leaving this attached for only 20 minutes, almost 19 percent of its files had been wiped for good, a process the researchers put down the ability of SSDs to initiate certain routines independent of a computer.

For comparison, on the equivalent hard drive all data was recoverable, regardless of the time elapsed, as a forensic examiner would expect

“Even in the absence of computer instructions, a modern solid-state storage device can permanently destroy evidence to a quite remarkable degree, during a short space of time, in a manner that a magnetic hard drive would not,” the team concludes.

The results are concerning on a number of levels, forensic, legal and technical.

Current digital forensic practice rests on assumptions about the ability of experts to isolate and snapshot drives accurately in order to back up possible criminal investigations. This is now looking to be far more difficult for SSDs than it has been for HDDs using current technologies.

Even more startling is that basic drive isolation ‘write blockers’ are not guaranteed to perform to high standards against SSDs, the first time this technology has ever been experimentally undermined. The firmware built into many and possibly all of these drives allows them to destroy data simply by being powered on, even when not connected to a PC or under the apparent control of an operating system.

“If the drive is purging data far faster than the analyst can extract it, and the process of purging can begin and continue while the analyst is extracting the data, how can the analyst hope to capture a complete, frozen image of the disk that is representative of the disk state at capture time?,” the researchers write.

“A few people in the forensics community had some awareness that something funny was going on with some SSDs, but everyone we've shown this to has been shocked at the extent of the findings,” said co-author Graeme Bell by email to Techworld.

As far as SSDs are concerned, the state of the drive cannot be taken to indicate that its owner did or did not interact with it in ways that allow prosecutors to infer guilt or innocence.

“The fact that data has been purged does not mean a human knowingly did it (e.g. accidental guilt). [But] data purging may make a guilty person look innocent (e.g. accidental innocence),” says Bell.

The team warns that as USB sticks grow in capacity, manufacturers could start integrating similar purging technologies into them, duplicating the same problem for a second set of storage media. Bell and Boddington also believe that ‘garbage collection’ routines will become more aggressive over time as manufacturers start using more powerful firmware, chipsets and larger-capacity drives.

In an 18-point summary of their findings, the pair offer no simple fixes to the problem they are the first to experimentally demonstrate, noting that “there is no simple answer to this problem.”

How many SSDs might use 'garbage collection' firmware? According to Bell, probably very few older drives but an increasing number of newer ones.

Previously only published in The Journal of Digital Forensics, Security and Law in December 2010, the full report can now be downloaded from the publication’s website.

Paradoxically, only last week researchers in California uncovered a separate but related problem with SSDs, namely that it could be hard to securely wipe data from them in a guaranteed, controlled way.

Although at first it sounds as if this finding contradicts the Australian research (i.e that data is constantly being wiped by SSDs in order to maintain performance), it is more concerned with the difficulty of guaranteeing that data has really been erased from the portion of the drive it is located on from the point of view of software erase programs.
http://news.techworld.com/security/3...earchers-find/

From 2007

High-Traffic Colluding Tor Routers in Washington, D.C., and the Ugly Truth About Online Anonymity
Kevin

With the U.S. Government trying to shut down websites and stealing gold, I feel the need to discuss communications security, surveillance and anonymity as the U.S. collapses further into overt fascism.

I need to get this off my chest, once and for all, because people, who don’t know much about computers, are being bombarded with nonsense, and they’re bombarding me with nonsense as a result. I want a single post that goes all the way, and this is it.

“Have you heard about Tor?” I am routinely asked via clear text email.

Yes, I know about Tor, but we need to take a much closer look at what remaining anonymous online really requires.

First of all, since this is a long post, I don’t want to waste your time. If you’re a computer expert or network engineer, etc. you will already know this stuff. If, however, you’re a casual computer user who doesn’t know much about the underlying principles of information systems, this will be way over your head. If you’re a casual computer user who is thinking about anonymity online, this article might be useful for letting you know some more about what you don’t know.

A lot of times, ignorant people refer to things they don’t understand as “tinfoil.” (The gatekeeper Left loves this term.) What follows, however, is so far out that it seems like tinfoil even to me. But then again, I haven’t been targeted by a death squad for my activities online, like some people are in many countries around the world. So, is it tinfoil? For you, maybe. For people struggling against repressive regimes, maybe not.

When I use the term “tinfoil” below, I’m not making fun of you, I’m making fun of myself, and the roles I’ve had to play in corporate IT departments. You don’t know tinfoil unless you’ve worked in a corporate IT department. Corporate IT is a technocratic pyramid built on paranoia, surveillance and fiefdoms of specialized knowledge and privileges (rights and permissions). Since all modern fascist organizations are essentially the same, I hope that my grim experiences within these organizations will help you understand more about the nature of the dire situation that we’re all facing.

If you think that you’re thinking outside of the box, my main purpose in writing this is to inform you that there are actually boxes within boxes, and that if you plan on engaging an opponent as powerful as the American Corporate State (or any other maniac fascist regime), it’s not going to be easy. I don’t know how many boxes within boxes there are. What I do know is that the U.S. Department of Defense built the underlying technologies that make the Internet possible. They built “this” world.

So, you want to be anonymous in a world that was thought up by the U.S. Department of Defense?

Most computer users don’t have what it takes, in terms of technical skills, or discipline, to pull it off. I’m sorry if that sounds harsh, but it’s absolutely true. I’m not claiming to be any kind of expert at all. If knowledge of computers and networks represented all the grains of sand on a beach, I’d say that I was familiar with about 5 of those grains of sand. I would like to hear from people who know more than me about any flaws in this information.

A long time ago, as a sort of theoretical challenge to myself, I tried to define a reliable protocol for remaining anonymous online. Why? Ask any nerd, “Why?” and the nerd will usually respond: “Why not?” If the nerd is unusually honest, he or she might respond, “Because I can’t help it.” So, somewhere between, “Why not?” and “Because I couldn’t help it,” I set out on this quest.

As you might already know, I studied information warfare in college and I did several years of time in corporate IT environments. I knew about the types of surveillance and control that are possible at the client, server and network levels.

I looked at the challenge as all IT people look at all IT related challenges: Assume the absolute worst.

I went even further with this. I made irrationally negative assumptions.

I assumed that everything I did online was compromised. I assumed the worst tinfoil nightmares about commercial operating systems. I assumed that my ISP was a subsidiary of the NSA, etc.

Got the idea?

Let’s look at each level in a bit more detail (in no particular order):

Servers: Potential Honeypots

Many technologies that amateur anonymity fetishists are attracted to are actually designed to harvest information. Put yourself in the shoes of the NSA. If you wanted a concentrated haul of the most interesting information what would you do?

You would establish a honeypot: a service (free or paid) that purported to provide an anonymous web browsing/email capability. Who knows what people might get up to if they thought nobody was looking? That, of course, is the idea with honeypots.

If you’re relying on a proxy server, how will you know that it’s not simply recording your entire session for examination by acreages of the Homeland’s supercomputers that are running advanced statistical Magic 8 Ball algorithms? Because the company or individual providing your proxy service says that they don’t keep logs? HA

Am I saying that all proxies are run by the NSA. No. Am I saying that some number of them are. I’d bet my life on it. How many of them are run by governments? I don’t know. Unless you know which governments are running which proxies, you must assume that all of them are compromised.

In reality, the NSA would probably be the least of your worries when using a proxy server or open base station.

Nerds with too much time on their hands get up to all kinds nonsense. Do they set up anonymous proxy servers and open base stations just to see what people do with them? Yes. Do criminals do it to find out personal information about you? Yes.

So even if the proxy or base station you’re on isn’t run by the NSA, who is running it? And why?

Maybe you’re eLitE and use several proxies. You can probably assume that the proxies aren’t colluding directly, but what about the networks? Which leads us to the next level…

Networks: If You Feel Like You’re Being Watched, It’s Because You Are

The network providers are keeping end to end records of every session. The question is: Are the network providers colluding with the U.S. Government? Since you can’t assume that they’re not, you must assume that they are. I would assume that the U.S. Government has end to end coverage of every IP session that starts and ends on U.S. networks. With corporate collusion and off the shelf hardware and software, this isn’t a stretch at all. For non U.S. networks, the NSA gets in with multi billion dollar tools like the U.S.S. Jimmy Carter, and who knows what else…

There are dozens of off the shelf products that you would swear were designed for use by intelligence agencies, but they’re routinely peddled to—and used by—corporations. If corporations have and use these surveillance capabilities, what are the intelligence agencies running on the service providers’ networks? I’ll be buggered if I know, but I know it’s not good. That recent ATT/NSA thing is just a tiny/trivial tip of the iceberg.

Clients: NSA Side Projects?

Microsoft and Apple sought assistance from the U.S. National Security Agency.

Evil Corporations Working with the NSA + Closed Source Binaries = Not Good.

What is that thing actually doing? I don’t know. Thank you. That’s all I need to know.

Countermeasures

Access the Internet Using an Open Wireless Network, Preferably from Great Distance

In terms of a threat assessment, for our purposes, I see the networks as posing the biggest problem.

People write to me all the time raving about the dreaded Google cookie. HA. “We must use scroogle!” for freedom and safety, etc.

When I mention that their ISP is, most likely, keeping every URL that they visit in a database, at a minimum, and that NSA boxes are probably analyzing every FORM tagged submission, well, that’s a hard lesson for people. Go ahead, use scroogle. Maybe the people running it aren’t evil. So what. Scroogle might make you feel good, but it has nothing to do with security or anonymity, not when you consider the capabilities of the enemy on the network.

Give any 14 year old hacker access to the right network switch and, unless you know what you’re doing, he or she will use a packet sniffer to find out what you had for breakfast. Now, the difference between most 14 year old hackers and the NSA is that the pimply faced kids don’t have physical access to the network that would allow them to conduct man in the middle surveillance on you. The NSA does. Again, that NSA/ATT thing is fly fart level. That’s nothing. That’s just the piece of the program that got outed.

You need a false flag connection to the Internet. In other words, access the Internet via someone else’s open wireless router, preferably from great distance. Lots of organizations, businesses and individuals provide free, wireless Internet access; on purpose, believe it or not. Ideally, you would use a cantenna or a high performance parabolic antenna to authoritatively distance yourself from any surveillance cameras that are likely saturating your local coffee shop or other business that provides free Internet access. Hitting the base station from hundreds of meters away would be nice.

If you were to carry the paranoia to an extreme level, you would assume that They would show up at your access point and use direction finding equipment to spot your physical location. “Tinfoil!” you say? Keychain WiFi access point finders have had crude DF capabilities for years. Then you have civilian grade WiFi network engineering stuff like the Yellow Jacket. Direction finding is as old as the hills and trivial to do. If you do happen to attract the wrong kind of attention on an anonymous base station, pinpointing your location would be a simple matter.

Solution? If you are playing this game as if your life is on the line, don’t use the same open base station twice. Hey, this post is going out to those of you who send me the paranoid emails. You wanted to know, I’m telling you! I mean, it would suck to look toward your friendly anonymous WiFi provider with a pair of binoculars and see a guy in a suit looking back at you. Hint: if you see a van with several antennas arranged in some geometric pattern on the roof, that would not be a positive development. But that was 1980s era technology, the last time I dabbled with DF gear with a buddy of mine. Here’s a nice little integrated soup to nuts solution that is probably more like what They would be using.

Surf Away: Just Don’t Do Anything That You Normally Do Online

All of the stuff that you do with your “normal” online persona, you know, online banking, checking email, discussion groups, etc: You can’t do any of that. The second you associate a user profile on a server with your behavior, you’re back to square one. The Matrix has you. You would have to create what the intelligence business calls a “legend” for your new anonymous online life. You may only access this persona using these extreme communications security protocols. Obviously, you can’t create an agent X persona via your anonymous connection and then log into some site using that profile on your home cable modem connection. To borrow another bit of jargon from the people who do this for real, full time, you must practice “compartmentalization.”

If you actually attract the wrong kind of attention on a server, OR a network, with your agent X persona, if you haven’t f@#$%& up in some way, all roads will lead back to the open base station.

“After connecting through the open WiFi network, should I also use an anonymous proxy?”

I would assume that even if the proxy is clean, and there is no way to know that it is, They will have that thing covered on the network, end to end. Physical disassociation from the access point is the best proxy.

Client Side

Never write anything to disk. Oh, you weren’t planning on using your Windows or MacOS laptop with all of those closed source binaries whirring away, were you? Man, I don’t know where you got your tinfoil hat, but that thing is obviously defective.

You will have to learn about Live CD distributions of Linux.

You boot that thing. Do your business. Turn off the computer. Nothing is written to the hard disk.

“But I need to save my work?”

If you want to save your work, the easiest way of routinely handling encrypted workflow is to use an encrypted volume and a tool that only decrypts your data on the fly, in RAM. The best tool I know of for handling encrypted volumes is TrueCrypt. Hint: Use cascading encryption algorithms. [UPDATE: Is TrueCrypt a Honeypot?] Do They have some technology, in an underground hanger at Area 51, that’s capable of breaking one of those cascading crypto schemes? I don’t know. I doubt it, but anything is possible when infinite budgets are involved.

Hey, man, you wanted to save your work, right? That’s the score when you’ve got half a role of Reynolds Wrap® Aluminum Foil around your head.

“But I need to send email.”

For our purposes here, I wouldn’t. Email is locked down and heavily surveilled, partially because of the plague of spam, but read on…

I don’t believe in web based email solutions that purport to provide strong encryption and/or anonymity. Who knows what their applets and servers are doing? Not me. And if they rely on SSL, well, that’s ok for buying a book online, but no tinfoiler in his right mind would bet his life on SSL. The Thunderbird/Enigmail/GPG solution is the best way to send and receive VERY secure email that I know of. But will your agent x persona be able to deliver email via SMTP? I wouldn’t count on it. And from which domain? Unless you are very naughty, you shouldn’t be allowed anonymous access to a SMPT server anyway.

You might have to go with a throw-away web based email account and then cut and paste your encrypted messages into that. As a rule, however, never compose a message that you plan on encrypting in a web based form. Some of them use technologies that transmit what you’re typing over the web AS YOU TYPE. This is so you don’t lose what you typed if the session cuts out, but guess what? That’s right, you just blew it.

Use open source tools that are running locally on your system to encrypt and decrypt messages.

An effective way of communicating with someone, outside of email, would be via newsgroup or bulletin board that allows anonymous posting. (Note: If you try it here, I’ll just delete it.) You are, in effect, using the board as a numbers station. You’re not trying to hide the signal. You assume that it will be intercepted. You encrypt your message to the recipient, using his/her public key, and post the ciphertext to the board. The recipient goes on there, copies the message and decrypts it. I first encountered this in the mid 1990s on usenet. Of course, the person on the other end needs to have the same level of discipline and paranoia as you for this to work properly.

Last but not least: Make sure that you spoof your MAC address EVERY time you go online. Funny story: I worked at a place that was locked down to the point that every MAC address was screened at the network level. Say, for example, that someone brought in a personal laptop from home, even though there was no chance of being able to use the network for much (domain sign on was required) the switch would alert a sys admin indicating that an alien device was plugged into the network, along with the jack/cube/desk number.

MAC addresses are unique, and perfect for surveillance purposes. Always spoof your MAC address when you’re running in agent x mode.

Well, that’s pretty much it. (Actually, I’m tired of typing.) I didn’t say it was going to be easy, and you should watch out for people and products that make those claims.

Of course, evil people could use the above techniques to do evil things, and that is the argument that the government will use to convince you to submit to total surveillance of everything you do.

In case you’re curious about how I get online: I use Windows XP on a five year old laptop, from home. While I’m running two firewalls, there’s no onion routing, proxies, live CD operating systems and I don’t bother with spoofing my MAC address. If you use a bank that knows where you live, They know where you live. Since I’m forced to use such a bank, I don’t bother with the rest. The Matrix has me.

If you think being anonymous online is hard, try living without a bank account…. Sorry, being homeless in a city park doesn’t count.

Oh yeah, what about Tor…

HAHA. Imagine my shock.

Via: tin0.de:

A group of 9 Tor routers also functioning overtly or indirectly as Tor exit nodes have been observed colluding on the public Tor network.

…

Due to the sheer amount of traffic apparently passing through this collusion network, consolidation and analysis of exit node traffic is only one of several forms of anonymity attacks made more feasible. Hence these 9 routers appear to pose a significant anonymity threat to users of the public Tor network.
http://cryptogon.com/?p=624

Newspaper Must Identify Anonymous Posters to Website, Judge Rules

Ruling is state's 1st on the issue
Jeff Swiatek

A Marion County judge has ruled, for the first time in Indiana, that news media outlets can be ordered by the court to reveal identifying information about posters to their online forums.

In rulings this week and last week, Marion Superior Court Judge S.K. Reid became the first judge in Indiana to rule on whether the state journalism shield law protects media outlets from being forced to disclose names of anonymous posters on their websites or other identifying information about those posters, said Kevin Betz, an attorney for Jeffrey Miller, former chief executive of Junior Achievement of Central Indiana.

The rulings came in a defamation lawsuit Miller filed last year. He is seeking to broaden the list of defendants in his case to include people who criticized him anonymously last year on websites run by The Indianapolis Star, Indianapolis Business Journal and WRTV (Channel 6).

The case is among a growing number of defamation claims nationally that target anonymous Internet posters to websites operated by news media and other owners.

"We are seeing more and more defamation lawsuits being filed, that's clear," said David Hudson, a First Amendment scholar at the First Amendment Center, affiliated with Vanderbilt University in Nashville, Tenn. Hudson said the public should be concerned if anonymous comments on public websites begin drying up because of the fear of lawsuits. "If this happens, then people will be less likely to comment" on public issues, he said.

All three Indianapolis media outlets fought the subpoenas served on them to turn over identifying information about posters to their sites.

The judge ruled that The Star and IBJ must turn over the identifying information, which typically tells a poster's Internet protocol address or Internet provider. Using that, an attorney can subpoena the Internet provider for the poster's real name.

The Star had fought the disclosure, saying in its 15-page motion that the shield law protects it from being forced to disclose names of anonymous posters on its IndyStar.com website, as does the Constitution and its guarantees of freedom of speech.

"Our practice is not to reveal the names" of people who post anonymously on The Star's website, said Star Editor and Vice President Dennis Ryerson. "We've long had a practice of protecting sources at all levels."

Ryerson wouldn't comment on the judge's ruling, except to say, "We now are reviewing our legal options."

The judge's ruling on whether WRTV also must turn over information about its posters is expected this week.

The IBJ has already turned over the information Miller sought, Betz said.

The posters identified include Kelsey Hanlon, described as a former staffer at Junior Achievement; James Leagre, who is called a friend of Junior Achievement's current chief executive; and Dave Wilson, vice president of corporate sponsorship for the 500 Festival Associates.

500 Festival Associates also was added as a defendant in the defamation claim, on the grounds that the defamatory comments supposedly traced to Wilson were sent on one of its computers.

Miller, whose wife, Cynthia, is a co-plaintiff in the case, initially sued Jennifer Burk, who is the current chief executive of Junior Achievement of Central Indiana; Brian Payne, who is president of Central Indiana Community Foundation; and both of their organizations.

The amended complaint adds as many as nine other people. They are listed in the lawsuit as "John Does."

Betz said he doesn't see the judge's recent rulings as weakening the state's shield law, which gives broad protections to news reporters from having to disclose names of sources who provide information used in news stories.

"This is not an assault on the shield law," Betz said. "In fact, it is well within the bounds of the traditional terms of the shield law. I don't think the media should be interested . . . in protecting the identities of cyberbullies. I don't think these people are advancing any cause of democracy or purposeful free speech.

"All it is is cyberbullying. And these kind of individuals need to understand there is accountability for that kind of behavior."
http://www.indystar.com/article/2011...onymous-poster

Student Files Lawsuit Over FBI's GPS Tracking
Nedra Pickler

A community college student who says he's never done anything that should attract the interest of federal law enforcement officials filed a lawsuit Wednesday against the FBI for secretly putting a GPS tracking device on his car.

Yasir Afifi, 20, says a mechanic doing an oil change on his car in October discovered the device stuck with magnets between his right rear wheel and exhaust. They weren't sure what it was, but Afifi had the mechanic remove it and a friend posted photos of it online to see whether anyone could identify it. Two days later, Afifi says, agents wearing bullet-proof vests pulled him over as he drove away from his apartment in San Jose, Calif., and demanded their property back.

Afifi's lawsuit, filed by the Council on American-Islamic Relations, claims the FBI violated his civil rights by putting the device on his car without a warrant. His lawyers say Afifi, who was born in the United States, was targeted because of his extensive ties to the Middle East — he travels there frequently, helps support two brothers who live in Egypt, and his father was a well-known Islamic-American community leader who died last year in Egypt.

FBI Spokesman Michael Kortan declined to discuss the lawsuit or the agency's investigation into Afifi, but said, "The FBI conducts investigations under well-established Department of Justice and FBI guidelines that determine what investigative steps or techniques are appropriate. Those guidelines also ensure the protection of civil and constitutional rights."

Afifi, who is a business marketing major at Mission College and works as a computer salesman, said at a news conference to announce the suit that the agents never gave him a clear answer as to why he was being monitored.

"I'm sure I have done nothing wrong to provoke anyone's interest," Afifi said, although he noted that his family is from Egypt, he's a young man and he makes a lot of calls overseas. "So I'm sure I fit their profile."

Judges have disagreed over whether search warrants should be required for GPS tracking. Afifi's lawyers say they are filing this lawsuit in hopes of a decision saying that any use of tracking devices without a warrant in the United States is unconstitutional.

The federal appeals court in the Washington circuit where Afifi's case was filed ruled in August that the collection of GPS data amounts to a government "search" that required a warrant. The Obama administration asked the court to change its ruling, calling the decision "vague and unworkable" and arguing that investigators will lose access to a tool they now use "with great frequency."

The lawsuit says the agents who showed up to collect the device were "hostile," threatening to charge Afifi if he didn't immediately cooperate and refusing his request to have a lawyer present. The suit also says agents showed they knew private details about his life, such as which restaurants he dined at, the new job he'd just obtained and his plans to travel abroad.

"At first I was really confused," Afifi said at the news conference, adding that he finally decided to turn over the GPS. "I did give it back to them after a lot of pressure."
http://news.yahoo.com/s/ap/20110303/...cking_warrants

Connecticut Legislator to Discipline Cops Who Hassle Photographers

Connecticut State Sen. Martin Looney (D-New Haven) has introduced a short bill (PDF) that not only acknowledges the right of citizens to record on-duty police officers, it also provides for a civil action against police officers who violate that right.

That second part is important. A right doesn’t mean much if there are no consequences for government officials who ignore it. Witness this case in Florida, where an officer erroneously tries to say federal law prohibits citizen recordings of cops. Even in states where courts have thrown out criminal charges, a cop who doesn’t want to be recorded can still harass, threaten, and even arrest you. You may not be charged. But he won’t be punished, either.

This is the first proposed state law I’ve seen on this issue that includes an appropriate enforcement mechanism. It would be great to see Congress take up a similar bill, under the First and Fourteenth Amendments.
http://www.theagitator.com/2011/02/24/short-but-sweet/

HBGary Federal CEO Aaron Barr Steps Down
Paul Roberts

Embattled CEO Aaron Barr says he is stepping down from his post at HBGary Federal to allow the company to move on after an embarassing data breach.

The announcement comes three weeks after Barr became the target of a coordinated attack by members of the online mischief making group Anonymous, which hacked into HBGary Federal's computer network and published tens of thousands of company e-mail messages on the Internet. HBGary did not respond to telephone and e-mail requests for comments on Barr's resignation.

In an interview with Threatpost, Barr said that he is stepping down to allow himself and the company he ran to move on in the wake of the high profile hack.

“I need to focus on taking care of my family and rebuilding my reputation," Barr said in a phone interview. "It’s been a challenge to do that and run a company. And, given that I’ve been the focus of much of bad press, I hope that, by leaving, HBGary and HBGary Federal can get away from some of that. I’m confident they’ll be able to weather this storm.”

The group conducted a preemptive strike on HBGary after Barr was quoted in a published article saying that he had identified the leadership of the group and planned to disclose their identities at the B-Sides Security Conference in San Francisco.

By combining a SQL injection attack on HBGary's Web site with sophisticated social engineering attacks, the group gained access to the company's Web- and e-mail servers as well as the Rootkit.com Web site, a site also launched by HBGary founder Greg Hoaglund. Ultimately, the group defaced HBGary's Web site and disgorged the full contents of e-mail accounts belonging to Barr, Hoglund and other company executives.

Though Barr and HBGary were the victims of the hack, the contents of the e-mail messages divulged plans that cast both in an unflattering light. Among them were data mining efforts and mentions of possible disinformation campaigns on behalf of a "large U.S. bank" and the law firm that represents the U.S. Chamber of Commerce that seem to run afoul of civil liberties and professional ethics.

HBGary counted many U.S. government agencies, including the Department of Defense, CIA and NSA as customers. The disclosure of e-mail messages from the company poses a major security risk to those organizations, as well as individuals who had corresponded with the firm. The breach also raises troubling questions about the direction that HBGary and other Beltway firms have taken. Email exchanges published online revealed the firm to be at work on a variety of plans to do data mining and information operations on U.S. organizations and journalists on behalf of clients including law firms representing a large U.S. bank and the U.S. Chamber of Commerce. Most recently, the incident spilled into the mainstream, with comedian Stephen Colbert devoting a segment of his Colbert Report program on February 24 to the HBGary hack.
https://threatpost.com/en_us/blogs/h...ps-down-022811

Manning Hit with 22 Additional Criminal Charges
Declan McCullagh

Alleged WikiLeaks leaker Bradley Manning is facing 22 additional criminal charges, including one that involves the death penalty, the U.S. military said today.

These add to the charges already pending against the U.S. Army private suspected of being the source for WikiLeaks' massive document dumps of military and State Department files. Manning is currently being held at a military jail in Quantico, Va., outside of Washington, D.C.

Manning was originally charged last July with sending a military video to a person not authorized to receive it and with obtaining "more than 150,000 diplomatic cables" from the State Department. WikiLeaks began to release the department's internal cables last fall, following the publication of military dispatches from Afghanistan and Iraq a few months earlier.

David Coombs, Manning's attorney, said today that, for the last few weeks, "the defense has been preparing for the possibility of additional charges in this case." An investigating officer will have to decide which, if any, of these additional charges will be referred to a court martial, Coombs said.

Perhaps the most serious of the additional charges is an allegation of aiding the enemy. The Army's benchbook for military judges says that crime is punishable by death.

The charge requires that any "intelligence" given to the enemy is, at least in part, true. "Enemy" is defined as not only opposing forces in time of war, but also a "hostile body" and "civilians as well as members of military organizations."

In a note on its Twitter feed, the Department of Defense pointed out that one of the charges is a "capital offense," meaning punishable by death. But our colleagues at CBS News are being told that Army prosecutors will ask only for life in prison and not the death penalty.

There's no mention of WikiLeaks or its spokesman, Julian Assange, in the 8-page charge sheet. CBS News national security correspondent David Martin, who covers the Pentagon, says that's "not surprising since the Justice Department has opened an espionage case against Assange and would not want to give away any details of its investigation until it's completed."

WikiLeaks responded to the news of the additional charges by saying the charge of aiding the enemy "is a vindictive attack on Manning for exercising his right to silence."

Manning is, of course, presumed innocent until proved guilty.

Among the additional charges: While in Iraq, Manning caused "to be published on the Internet intelligence belonging to the United States government." He allegedly leaked a video file titled "12 JUL 07 CZ ENGAGEMENT ZONE 30 GC Anyone.avi." And he allegedly expropriated an "Iraq Microsoft Outlook / SharePoint Exchange Server global address list belonging to the United States government."

Manning has been kept in solitary confinement and his activities heavily restricted, which prompted him to lodge a complaint, also signed by his attorney, against the Quantico base commander.

The complaint says that as of January 18 his captivity conditions were changed to: "I sit in my cell for 24 hours a day. I am stripped of all clothing with the exception of my underwear. My prescription eyeglasses are taken away from me. I am forced to sit in essential blindness...Additionally, there is a guard sitting outside of my cell watching me at all times."

Adrian Lamo, a hacker who pleaded guilty in 2004 to breaking into The New York Times' computer network, told CNET last June that Manning had contacted him and shared details of his leaks. Lamo said he subsequently tipped off and met with authorities.

Lamo said today that he considers Manning a "spy." He also said the private likely will escape the death penalty because "we don't habitually execute spies." The additional charges are "commensurate with the gravity" of Manning's offenses, Lamo said, adding that he was "maintaining hope that Manning will have a life to rebuild once he has paid his debt to society."
http://news.cnet.com/8301-31921_3-20038508-281.html

Manning Jailed Naked, Lawyer Says
Charlie Savage

A lawyer for Pfc. Bradley Manning, the Army intelligence analyst accused of leaking secret government files to WikiLeaks, has complained that his client was stripped and left naked in his cell for seven hours on Wednesday.

The conditions of Private Manning’s confinement at the Marine brig in Quantico, Va., have drawn criticism in recent months from supporters and his lawyer, David E. Coombs.

The soldier’s clothing was returned to him Thursday morning, after he was required to stand naked outside his cell during an inspection, Mr. Coombs said in a posting on his Web site.

“This type of degrading treatment is inexcusable and without justification,” Mr. Coombs wrote. “It is an embarrassment to our military justice system and should not be tolerated. Pfc. Manning has been told that the same thing will happen to him again tonight. No other detainee at the brig is forced to endure this type of isolation and humiliation.”

First Lt. Brian Villiard, a Marine spokesman, said a brig duty supervisor had ordered Private Manning’s clothing taken from him. He said that the step was “not punitive” and that it was in accordance with brig rules, but he said that he was not allowed to say more.

“It would be inappropriate for me to explain it,” Lieutenant Villiard said. “I can confirm that it did happen, but I can’t explain it to you without violating the detainee’s privacy.”

Private Manning is being held as a maximum security detainee under a special set of restrictions intended to prevent self-injury, even though supporters say there is no evidence that he is suicidal.

During an appearance on MSNBC earlier on Thursday, Geoffrey Morrell, the Pentagon press secretary, attributed the general conditions of Private Manning’s confinement to “the seriousness of the charges he’s facing, the potential length of sentence, the national security implications” and to protect him from potential harm.

Also, earlier on Thursday, one of Private Manning’s friends, David House, said in a conference call with reporters that he had visited the soldier the previous weekend and that his mental condition was severely deteriorating as a result of being confined to his cell 23 hours a day, with one hour to exercise in an empty room, and largely isolated from human contact.

But Mr. House said that Private Manning did not seem suicidal and contended that he was being pressured to cooperate.

Investigators have been seeking evidence that could implicate Julian Assange, the WikiLeaks founder, as a conspirator in the leaking of the military and diplomatic documents and videos.

Mr. House spoke on the conference call with Daniel Ellsberg, who compared the leaking of documents to WikiLeaks to his own leaking of the Pentagon Papers during the Vietnam War. On Wednesday, the Army announced 22 additional charges against Private Manning, including “aiding the enemy.”

The charge sheet did not explain who “the enemy” was, leading some to speculate that it was a reference to WikiLeaks. On Thursday, however, the military said that it instead referred to any hostile forces that could benefit from learning about classified military tactics and procedures.
https://www.nytimes.com/2011/03/04/us/04manning.html

Bradley Manning's Forced Nudity to Occur Daily
Glenn Greenwald

To follow-up on yesterday's observations about the prolonged forced nudity to which Bradley Manning has been subjected the last two days: brig officials now confirm to The New York Times that Manning will be forced to be nude every night from now on for the indefinite future -- not only when he sleeps, but also when he stands outside his cell for morning inspection along with the other brig detainees. They claim that it is being done "as a 'precautionary measure' to prevent him from injuring himself."

Has anyone before successfully committed suicide using a pair of briefs -- especially when under constant video and in-person monitoring? There's no underwear that can be issued that is useless for killing oneself? And if this is truly such a threat, why isn't he on "suicide watch" (the NYT article confirms he's not)? And why is this restriction confined to the night; can't he also off himself using his briefs during the day?

Let's review Manning's detention over the last nine straight months: 23-hour/day solitary confinement; barred even from exercising in his cell; one hour total outside his cell per day where he's allowed to walk around in circles in a room alone while shackled, and is returned to his cell the minute he stops walking; forced to respond to guards' inquiries literally every 5 minutes, all day, everyday; and awakened at night each time he is curled up in the corner of his bed or otherwise outside the guards' full view. Is there anyone who doubts that these measures -- and especially this prolonged forced nudity -- are punitive and designed to further erode his mental health, physical health and will? As The Guardian reported last year, forced nudity is almost certainly a breach of the Geneva Conventions; the Conventions do not technically apply to Manning, as he is not a prisoner of war, but they certainly establish the minimal protections to which all detainees -- let alone citizens convicted of nothing -- are entitled.

The treatment of Manning is now so repulsive that it even lies beyond what at least some of the most devoted Obama admirers are willing to defend. For instance, UCLA Professor Mark Kleiman -- who last year hailed Barack Obama as, and I quote, "the greatest moral leader of our lifetime" -- wrote last night:

Quote:

The United States Army is so concerned about Bradley Manning’s health that it is subjecting him to a regime designed to drive him insane. . . . This is a total disgrace. It shouldn't be happening in this country. You can't be unaware of this, Mr. President. Silence gives consent.

The entire Manning controversy has received substantial media attention. It's being carried out by the military of which Barack Obama is the Commander-in-Chief. Yes, the Greatest Moral Leader of Our Lifetime and Nobel Peace Prize winner is well aware of what's being done and obviously has been for quite some time. It is his administration which is obsessed with destroying and deterring any remnants of whistle-blowing and breaches of the secrecy regime behind which the National Security and Surveillance States function. This is all perfectly consistent with his actions in office, as painful as that might be for some to accept (The American Prospect, which has fairly consistently criticized Obama's civil liberties abuses, yesterday called the treatment of Manning "torture" and denounced it as a "disgrace"). As former Army officer James Joyner (and emphatic critic of WikiLeaks and Manning) writes:

Quote:

Obama promised to close Gitmo because he was embarrassed that we were doing this kind of thing to accused terrorists. But he's allowing it to happen to an American soldier under his command?

And I'll say this again: just fathom the contrived, shrieking uproar from opportunistic Democratic politicians and their loyalists if it had been George Bush and Dick Cheney -- on U.S. soil -- subjecting a whistle-blowing member of the U.S. military to these repressive conditions without being convicted of anything, charging him with a capital offense that statutorily carries the death penalty, and then forcing him to remain nude every night and stand naked for inspection outside his cell. Feigning concern over detainee abuse for partisan gain is only slightly less repellent than the treatment to which Manning is being subjected.
http://www.salon.com/news/opinion/gl...ing/index.html

Assange Complains of Jewish Smear Campaign
Ravi Somaiya

A report published by a British magazine on Tuesday said the WikiLeaks founder, Julian Assange, suggested that British journalists, including the editor of The Guardian, were engaged in a Jewish-led conspiracy to smear his organization.

His remarks appeared in the magazine Private Eye, in an article by its editor, Ian Hislop, who outlined a rambling phone call that Mr. Assange made on Feb. 16 to complain about the coverage of WikiLeaks.

He was especially angry about a Private Eye report that Israel Shamir, an Assange associate in Russia, was a Holocaust denier. Mr. Assange complained that the article was part of a campaign by Jewish reporters in London to smear WikiLeaks.

A lawyer for Mr. Assange could not immediately be reached for comment, but in a statement later released on the WikiLeaks Twitter feed, Mr. Assange said Mr. Hislop had “distorted, invented or misremembered almost every significant claim and phrase.”

The Private Eye article quoted Mr. Assange as saying the conspiracy was led by The Guardian and included the newspaper’s editor, Alan Rusbridger, and investigations editor, David Leigh, as well as John Kampfner, a prominent London journalist who recently reviewed two books about WikiLeaks for The Sunday Times of London.

When Mr. Hislop pointed out that Mr. Rusbridger was not Jewish, Mr. Assange countered that The Guardian’s editor was “sort of Jewish” because he and Mr. Leigh, who is Jewish, were brothers-in-law. Later, the article recounted, Mr. Assange asked Mr. Hislop to “forget the Jewish thing,” but he continued to insist there was a conspiracy against WikiLeaks based on the friendship among Mr. Rusbridger, Mr. Leigh and Mr. Kampfner.

In the Twitter feed, Mr. Assange said that “in particular” the Private Eye report that he believed in a “ ‘Jewish conspiracy’ is false, in spirit and in word. It is serious and upsetting. Rather than correct a smear, Mr. Hislop has tried to justify one smear with another.”

“That he has a reputation for this, and is famed to have received more libel suits in the U.K. than any other journalist as a result, does not mean that it is right,” Mr. Assange’s statement said. “WikiLeaks promotes the ideal of ‘scientific journalism’ — where the underlying evidence of all articles is available to the reader precisely in order to avoid these type of distortions. We treasure our strong Jewish support and staff, just as we treasure the support from pan-Arab democracy activists and others who share our hope for a just world.”

After Mr. Assange was accused of sexual abuse by two women in Stockholm last summer, he cited a “smear campaign” against WikiLeaks. A London court ruled last week that he must be extradited to Sweden to face questioning on those accusations.
http://www.nytimes.com/2011/03/02/wo...02assange.html

Assange Lawyer Under Investigation in Sweden

Julian Assange's Swedish lawyer Björn Hurtig is under investigation by the Swedish Bar Association (Advokatsamfundet) following accusations made by a British judge during the WikiLeaks founder's extradition trial.

In releasing his ruling last week that Assange should be extradited to Sweden, District Judge Howard Riddle, accused Hurtig of deliberately misleading the court, calling him "unreliable".

Riddle also claimed that Hurtig, who was called to testify at the trial by his client's British legal team, had purposefully given faulty information about how many times Swedish prosecutors tried to contact him.

Speaking with The Local following the announcement of the verdict, Hurtig rejected the British judge's criticism.

"I'm a reliable person; I'm a reliable witness," he said.

Following the criticism, the Swedish Bar Association has decided to demand Hurtig provide an explanation of his actions.

"We sent Hurtig a letter last week and asked him to explain himself," Bar Association secretary general Anne Ramberg told the TT news agency.

She described Judge Riddle's statements as a "extremely serious critique" of the Swedish lawyer.

"If I'm not satisfied with Hurtig's explanation, I may go to the bar association's governing board, and after that the disciplinary committee, which has the final say on any possible consequences," she said.

The most common complaints about Swedish attorneys come from outside the legal system, usually clients. But sometimes Ramberg takes the initiative herself to take up a suspected case of professional misconduct mentioned by a court, prosecutors, or by the media.

Hurtig has until March 14th to provide answers to the Bar Association's inquiry.
http://www.thelocal.se/32354/20110302/

Politician on Trial for Nude Muhammad Poster

A Swedish politician facing charges for producing a poster depicting the Muslim prophet Muhammad naked together with his nine-year-old wife was found not guilty by a jury in Malmö on Wednesday.

Carl P Herslow, leader of the Skåne Party (Skånepartiet), a small right-wing populist regional party, is charged with agitation against an ethnic group (hets mot folkgrupp).

The poster included the text: 'He is 53 and she is nine. Is this the kind of wedding we want to see in Skåne?'.

Herslow admits producing the poster but contested the charges. He said the aim of the poster was to stimulate a debate about Islam, which he argued was incompatible with democracy and equality.

"The intention was to provoke a strong reaction among both Muslims and non-Muslims," he said.

Prosecutor Bo Birgerson, representing the Chancellor of Justice (Justitiekanslern - JK) - the country's top legal official, who is responsible for prosecution of cases involving freedom of speech - said that the distribution of the poster showed disrespect to Muslims.

Birgerson argued that previous cases in the Supreme Court showed that conviction for Herslow would not violate his right under Swedish law to freedom of speech.

"A conviction is important to show where the boundaries are for debate in an open and democratic society."

The prosecution argued that Herslow should to be given a suspended prison sentence and for the posters to be confiscated.

But after deliberating less than an hour the jury, which are only used in Sweden in freedom of speech cases, told the court that Herslow was not guilty of agitation against an ethnic group.

As a result, the court cannot convict the politician when it delivers its formal verdict on March 16th.
http://www.thelocal.se/32368/20110303/

Mother Arrested for Filming Her Kids in the Tub

A Swedish woman was arrested on child pornography suspicions after she filmed her two young children taking a bath in an effort to prove they had been sexually abused by their father.

"This is completely absurd. The woman was concerned for her children’s safety and this is how it’s turned out. It’s a tragedy,” children's rights advocate Monica Dahlström-Lannes told The Local.

The woman at the heart of the case, which was first reported by the Aftonbladet newspaper, separated from the children's father in the summer of 2008.

Since then, the couple shared custody of the two children, a four-year-old son and five-year-old daughter.

Last year, however, the children started acting in a sexually suggestive manner, prompting the woman to suspect that they may have been sexually abused by their father.

While she reported the matter to police, the investigation was dropped due to lack of evidence.

“That’s when my lawyer advised me to film the children, in order to show the police how they were behaving,” the concerned mother told Aftonbladet.

The mother filmed the children when they were taking a bath and then showed the movie to officials from the local social services department (socialförvaltningen) before handing it to the police.

The next day she was arrested on suspicion of child pornography.

After spending a day behind bars and losing custody of her children, the woman was released.

Prosecutor Christel Anderberg argued she was in the right to film the children in order to collect evidence against the father.

But the decision to drop the investigation was appealed by the social services office, which argued that the woman has exposed her children for serious psychological abuse when filming them.

“It hasn’t been confirmed that the children have been sexually abused by their father, but to let the children continue with what they were doing in the tub is abuse,” the investigators concluded, according to Aftonbladet.

Following a district court ruling stripping the woman of custody, the children are now living with their father.

“The mother is of course very upset,” said Dahlström-Lannes, who is also former cop who specialised in investigating crimes against children.

"I’'e been working with cases like this for 25 years and it’s just getting worse."

She said the children's behaviour and actions "should be taken seriously" and has since reported the social services department to Sweden's Ombudsmen for Justice (Justitieombudsmännen- JO).

"It’s like the social welfare services have stopped listening to the children," said Dahlström-Lannes.

"It's really upsetting."
http://www.thelocal.se/32400/20110304/

South Korea Hit by Cyber Attacks

National Assembly, Seoul The National Assembly website was among high profile targets
BBC

South Korea has been hit by a series of cyber attacks which have targeted some of the country's leading websites.

Government ministries, the National Assembly, the military headquarters, US Forces in Korea and major banks were among those hit.

It is believed that the attackers injected malware into two peer-to-peer file-sharing websites.

The attacks are similar to those that targeted South Korean websites in July 2009.

Some 29 institutions were affected by so-called distributed denial-of-service attacks (DDoS) which overload a site with data causing it to fall over.

The web page of the Financial Services Commission, the country's financial regulator, was overloaded and an online stock trading system was shut down for a few minutes but both soon recovered, according to government sources.
North Korea

"There was a DDoS attack, but no damage was done," said an official from the presidential office.

South Korean security firm AhnLab expected another wave of attacks on Friday, targeting up to 40 government and corporate websites.

It estimates that up to 11,000 personal computers were infected by malware and recruited for the attack. It is distributing free software to clean PCs.

The South Korean cyber investigation unit has sent investigators to the two file-sharing sites that are believed to have spread the malicious code, according to the National Police Agency.

The cyber attacks against South Korea in 2009 were blamed on North Korea, although no link has been proven.

South Korean media outlets have, in the past, accused North Korea of running an internet warfare unit aimed at hacking into US and South Korean military networks.
http://www.bbc.co.uk/news/technology-12646052

ChronoPay’s Scareware Diaries
Brian Krebs

If your Windows PC has been hijacked by fake anti-virus software or “scareware” anytime in the past few years, chances are good that the attack was made possible by ChronoPay, Russia’s largest processor of online payments.

Tens of thousands of documents stolen and leaked last year from ChronoPay offer a fascinating look into a company that has artfully cultivated and handsomely profited from the market for scareware, programs that infiltrate victim PCs to display fake security alerts in a bid to frighten users into paying for worthless security software.

ChronoPay handles Internet bill payments for a variety of major Russian companies, including domestic airlines and utilities. But ChronoPay also specializes in processing the transactions of so-called “high-risk” industries, including online pharmacies, tobacco sales, porn and software sales. A business is generally classified as high-risk when there is a great potential for credit card chargebacks and a fair chance that it will shut down or vanish without warning.

In June 2009, The Washington Post published the results of a six-month investigation into ChronoPay’s high-risk business. At the time, ChronoPay was one of a handful of processors for Pandora Software, the most prevalent brand of rogue software that was besieging consumers at the time. That story drew links between ChronoPay and an entity called Innovagest2000, which was listed as the technical support contact in the end-user license agreements that shipped with nearly all Pandora rogue anti-virus products.

When I confronted ChronoPay’s CEO Pavel Vrublevsky in 2009 about the apparent ties between Innovagest and his company, he insisted that there was no connection, and that his company’s processing services were merely being abused by scammers. But the recently leaked ChronoPay documents paint a very different picture, showing that Innovagest2000 was but one example of a cookie-cutter operation that ChronoPay has refined and repeated over the last 24 months.

The documents show that Innovagest was a company founded by ChronoPay’s Spanish division, and that ChronoPay paid for everything, from the cost of Innovagest’s incorporation documents to the domain registration, virtual hosting and 1-800 technical and customer support lines for the company.

The same dynamic would play out with other ChronoPay “customers” that specialized in selling rogue anti-virus software. For example, leaked internal documents indicate that ChronoPay employees created two companies in Cyprus that would later be used in processing rogue anti-virus payments: Yioliant Holdings; and the strangely named Flytech Classic Distribution Ltd. ChronoPay emails show that employees also paid for domains software-retail.com and creativity-soft.com, rogue anti-virus peddling domains that were registered in the names and addresses of Yioliant Holdings and Flytech, respectively. Finally, emails also show that ChronoPay paid for the virtual hosting and telephone support for these operations. This accounting document, taken from one of the documents apparently stolen from ChronoPay, lists more than 75 pages of credit card transactions that the company processed from Americans who paid anywhere from $50 to $150 to rid their computers of imaginary threats found by scareware from creativity-soft.com (the amounts in the document are in Russian Rubles, not dollars, and the document has been edited to remove full credit card numbers and victim names).

Further, the purloined documents show these domains were aggressively promoted by external rogue anti-virus affiliate programs, such as Gelezyaka.biz, as well as a rogue anti-virus affiliate program apparently managed in-house by ChronoPay, called “Crusader.”

Meeting In Moscow

Last month, I traveled to Moscow and had a chance to sit down with Vrublevsky at his offices. When I asked him about Innovagest, his tone was much different from the last time we discussed the subject in 2009. This may have had something to do with my already having told him that someone had leaked me his company’s internal documents and emails, which showed how integral ChronoPay was to the rogue anti-virus industry.

“By the time which correlates with your story, we didn’t know too much about spyware, and that Innovagest company that you tracked wasn’t used just for spyware only,” Vrublevsky said. “It was used for a bunch of shit.”

Vrublevsky further said that some of ChronoPay’s customers have in the past secretly sub-let the company’s processing services to other entities, who in turn used it to push through their own shady transactions. He offered, as an example, an entity that I wasn’t previously aware had been a customer of ChronoPay’s: A rogue anti-virus promotion program called TrafficConverter.biz.

As I documented in a March. 2009 story for The Washington Post, Trafficconverter.biz paid its promoters or “affiliates” hundreds of thousands of dollars a month to pimp rogue anti-virus software. The domain Trafficconverter.biz was shut down briefly at the end of November when it was discovered that it was being sought out by millions of Microsoft Windows systems infected with the first variant of the Conficker worm, which instructed infected systems to visit that domain and download a specific file that suggested it would attempt to install rogue anti-virus software.

“That was a case where ChronoPay had a merchant account registered as an Internet payment service provider with Visa Iceland, where the same merchant account was being used by hundreds of small merchants, and one of them turned out to be the infamous TrafficConverter,” Vrublevsky explained.

But what of the leaked documents that show what appear to be ChronoPay employees setting up entire businesses that would later sell rogue anti-virus — including incorporation records, associated bank accounts, Web hosting, domain registration, telephone support and merchant accounts tied to these entities? Wasn’t ChronoPay concerned that this activity could make it appear that the company was simply building rogue anti-virus merchants from the ground up?

No, this is what high-risk payment service providers do, Vrublevsky explained.

“This is part of the service you provide,” he said. “Basically you own the companies that have those merchant IDs, plus you do customer support and everything which is related to that. And that’s how any other payment service provider does it, and you can find the same thing if you dig into companies like Wirecard, and Visa Iceland. So most payment service providers basically register the companies themselves and monitor the whole [operation] from the inside.”

Scareware Research & Development

The leaked records also show ChronoPay’s high-risk division worked diligently to stay on the cutting edge of the scareware industry. In March 2010, the company began processing payments for icpp-online.com, a scam site that stole victims’ money by bullying them into paying a “pre-trial settlement” to cover a “Copyright holder fine.” As security firm F-Secure noted at the time, victims of this scam were informed that an “antipiracy foundation scanner” had found illegal torrents from the victim’s system, and those who refused to pay $400 via a credit card transaction could face jail time and huge fines.

Internal ChronoPay documents show that hundreds of people fell for the scam, paying more than $400 each (the message at the top of the image indicates that the internal ChronoPay formula for counting the number of downloads and sales was generating errors, so take these numbers with a grain of salt).

ChronoPay also was the processor for a fake anti-virus product known as Shield-EC, which was processed through a merchant account tied to a company called Martindale Enterprises Ltd. Again, internal documents show that ChronoPay not only created Martindale Enterprises Ltd., and attached bank accounts to the company, but that it also paid for the domain registration, hosting and telephone support lines for shield-ec.com.

The shield-ec scareware scam was unique because the purveyors pitched it as “the result of a two-year research collaboration of programmers and analysts from Martindale Enterprises and ZeusTracker, the main center for ZeuS epidemic prevention.”

ZeusTracker is a free service run by an established security researcher, Roman Hüssy, who monitors Web addresses that are known to be associated with the distribution and management of the infamous ZeuS trojan. As Hüssy noted in a blog post at the time, the Shield-EC scareware campaign came with an interesting twist: The Web site shieldec.com was in fact hosted on a fast-flux botnet that was also being used to host at least two different servers used to control large numbers of PCs infected with ZeuS.

These days, Vrublevsky said, he’s hoping his company can have a go at the market for legitimate anti-virus products. When I met with him in Moscow, Vrublevsky told me about company plans to create and sell its own anti-virus product: ChronoPay Antivirus. At first I didn’t know whether to take him seriously. But then I found a document in the cache that confirmed that claim. A Russian-language document called ChronoPay AntiVirus Vision, dated June 15, 2010, details the company’s ambitions in this market.
http://krebsonsecurity.com/2011/03/c...eware-diaries/

Cutting Out Middleman to Sell Small Ads Online
Tanzina Vega

Online publishers, who have long been dismayed with the revenue from some of their advertising, are increasingly taking matters into their own hands.

In the last month, CBS Interactive and Forbes.com have both created their own ad exchanges to directly sell the lower-priced ads called remnants that typically run at the bottom of their Web pages or on secondary pages. These are following similar efforts by NBC Universal, Weather.com and Turner Broadcasting Systems.

For publishers, setting up exchanges has several advantages: they cut out the middlemen (those third-party ad networks that often sell cheaper remnant ads for teeth-whitening or weight-loss products across a broad range of sites) and they allow the publishers greater control over consumer data.

“The publishers that are setting the ground rules right now are making higher C.P.M.’s,” said Michael Greene, an analyst at Forrester Research, referring to the cost per thousand impressions, a yardstick for the value of an ad. He estimates that publishers who switch to their own exchanges can increase the C.P.M. of such ads from around $1 to up to $5.

For years, many online publishers like newspapers, magazine companies and sites affiliated with television networks have sold the premium ads — like the large banners across the top of a Web page — themselves, then used third-party networks to sell the rest at a much lower price. The switch in tactics comes at a time when online publishers are feeling a little more flush with the broad upswing in advertising and perhaps less anxious about squeezing every penny out of remnant ads.

“There is significant value in branded data,” said Kevin Gentzel, the chief revenue officer at Forbes, which has not been selling through third-party networks. “A Forbes in-market car buyer has more value that just an in-market car buyer.”

The shift also takes many publishers back to their advertising roots: building a particular audience to sell to a particular advertiser, not just spots on a Web page. “If advertisers want to come in, we’re selling them the network,” said Nick Johnson, the senior vice president of digital media sales at NBC Universal. “We’re not selling them placements; we’re selling them people.”

These private networks are also being created at a time when the federal government is investigating the surreptitious collection of personal data by third-party networks. Ad networks collect data on the users who visit publisher Web sites and sell user profiles to other advertisers. Ad networks typically use a small piece of code called a cookie to track the users across the Web.

Publishers creating their own networks now keep that data for themselves, instead of providing it to ad networks that might sell against the publisher’s target audience on another site.

“We want to make sure that we’re controlling what happens with data,” said Mr. Johnson. “We want to make sure we control pricing. Control’s a very important message. We don’t want there to be a cottage industry built on our backs.”

NBC announced its version of a private exchange, called the Universal Audience Platform, last July. In mid-February, CBS Interactive began its own private exchange. The platform, like most others, uses a technology called “real-time bidding” which allows advertisers to bid on specific users at specific times. The technology can tell advertisers data like what browser a person is using, the user’s I.P. address and location, the number of sites visited, and the current site the user is viewing. These facts help an advertiser place an ad in front of specific users at the optimum time.

For readers, the switch could mean fewer ads for herbal remedies and teeth-whitening, at least on some Web pages. “In the private exchange model, the goal is to make sure you’re delivering high-quality inventory to high-quality advertisers,” said Mr. Greene of Forrester.

Advertising agencies say they welcome publishers taking control. Brendan Moorcroft, the chief executive of Cadreon, the agency trading desk at the Interpublic Group, said that top-tier publishers could create a spot for advertising “that aligns to our needs more greatly and more efficiently.”

Mike Cassidy, the chief executive and founder of Undertone, an ad network, said networks that sell low-quality advertisements will suffer the most. “Does this over all cause concern for networks? Absolutely,” Mr. Cassidy said. “Does it cause concern for every ad network? Absolutely not.”

Mr. Cassidy said that 18 of the company’s top 20 advertisers were Fortune 500 companies and that business had grown 40 percent in 2010. Undertone sells advertising in areas not typically available on most exchanges, including formats like full-page ads and video ads. “If you look through the history of mankind, middlemen have existed forever,” Mr. Cassidy said.

In November of last year, Weather.com announced its private exchange, called Category 5, through which it has sold ad space to premium advertisers like Sprint, Chevrolet, Hewlett-Packard and Microsoft. Michael J. Kelly, the chief executive of the Weather Channel Companies, said the exchange helped the company protect sensitive consumer data from getting into the wrong hands. For instance, the company tracks users’ locations in order to provide local weather updates, Mr. Kelly said.

“By putting our inventory into ad networks, we lose control over that,” Mr. Kelly said.

Officials from the Federal Trade Commission declined to comment on the creation of private exchanges and publishers’ shift to data collection, but in a report issued in December the commission sought comment from the industry on how to better define the acceptable uses of marketing and data collection.

All of the publishers interviewed said that the data they collected was not personally identifiable and that data collection practices were in line with industry principles of self-regulation.

“I think the days of being reliant on third-party companies are numbered,” said Jason Kelly, the chief media officer for Admeld, a technology company that helps publishers manage their online advertising. “Agencies are investing in technology. Publishers are now investing in technology. Publishers are looking to own the relationship with their clients.”
http://www.nytimes.com/2011/02/28/bu...28network.html

Regulators Reject Proposal That Would Bring Fox-Style News to Canada
Robert Kennedy, Jr.

As America's middle class battles for its survival on the Wisconsin barricades -- against various Koch Oil surrogates and the corporate toadies at Fox News -- fans of enlightenment, democracy and justice can take comfort from a significant victory north of Wisconsin border. Fox News will not be moving into Canada after all! The reason: Canada regulators announced last week they would reject efforts by Canada's right wing Prime Minister, Stephen Harper, to repeal a law that forbids lying on broadcast news.

Canada's Radio Act requires that "a licenser may not broadcast....any false or misleading news." The provision has kept Fox News and right wing talk radio out of Canada and helped make Canada a model for liberal democracy and freedom. As a result of that law, Canadians enjoy high quality news coverage including the kind of foreign affairs and investigative journalism that flourished in this country before Ronald Reagan abolished the "Fairness Doctrine" in 1987. Political dialogue in Canada is marked by civility, modesty, honesty, collegiality, and idealism that have pretty much disappeared on the U.S. airwaves. When Stephen Harper moved to abolish anti-lying provision of the Radio Act, Canadians rose up to oppose him fearing that their tradition of honest non partisan news would be replaced by the toxic, overtly partisan, biased and dishonest news coverage familiar to American citizens who listen to Fox News and talk radio. Harper's proposal was timed to facilitate the launch of a new right wing network, "Sun TV News" which Canadians call "Fox News North."

Harper, often referred to as "George W. Bush's Mini Me," is known for having mounted a Bush like war on government scientists, data collectors, transparency, and enlightenment in general. He is a wizard of all the familiar tools of demagoguery; false patriotism, bigotry, fear, selfishness and belligerent religiosity.

Harper's attempts to make lying legal on Canadian television is a stark admission that right wing political ideology can only dominate national debate through dishonest propaganda. Since corporate profit-taking is not an attractive vessel for populism, a political party or broadcast network that makes itself the tool of corporate and financial elites must lie to make its agenda popular with the public. In the Unites States, Fox News and talk radio, the sock puppets of billionaires and corporate robber barons have become the masters of propaganda and distortion on the public airwaves. Fox News's notoriously biased and dishonest coverage of the Wisconsin's protests is a prime example of the brand of news coverage Canada has smartly avoided.
http://www.huffingtonpost.com/robert..._b_829473.html

Bittorrent Over Tor Isn't a Good Idea
arma

An increasing number of people are asking us about the recent paper coming out of Inria in France around Bittorrent and privacy attacks. This post tries to explain the attacks and what they imply.

There are three pieces to the attack (or three separate attacks that build on each other, if you prefer).

The first attack is on people who configure their Bittorrent application to proxy their tracker traffic through Tor. These people are hoping to keep their IP address secret from somebody looking over the list of peers at the tracker. The problem is that several popular Bittorrent clients (the authors call out uTorrent in particular, and I think Vuze does it too) just ignore their socks proxy setting in this case. Choosing to ignore the proxy setting is understandable, since modern tracker designs use the UDP protocol for communication, and socks proxies such as Tor only support the TCP protocol -- so the developers of these applications had a choice between "make it work even when the user sets a proxy that can't be used" and "make it mysteriously fail and frustrate the user". The result is that the Bittorrent applications made a different security decision than some of their users expected, and now it's biting the users.

The attack is actually worse than that: apparently in some cases uTorrent, BitSpirit, and libTorrent simply write your IP address directly into the information they send to the tracker and/or to other peers. Tor is doing its job: Tor is _anonymously_ sending your IP address to the tracker or peer. Nobody knows where you're sending your IP address from. But that probably isn't what you wanted your Bittorrent client to send.

That was the first attack. The second attack builds on the first one to go after Bittorrent users that proxy the rest of their Bittorrent traffic over Tor also: it aims to let an attacking peer (as opposed to tracker) identify you. It turns out that the Bittorrent protocol, at least as implemented by these popular Bittorrent applications, picks a random port to listen on, and it tells that random port to the tracker as well as to each peer it interacts with. Because of the first attack above, the tracker learns both your real IP address and also the random port your client chose. So if your uTorrent client picks 50344 as its port, and then anonymously (via Tor) talks to some other peer, that other peer can go to the tracker, look for everybody who published to the tracker listing port 50344 (with high probability there's only one), and voila, the other peer learns your real IP address. As a bonus, if the Bittorrent peer communications aren't encrypted, the Tor exit relay you pick can also watch the traffic and do the attack.

That's the second attack. Combined, they present a variety of reasons why running any Bittorrent traffic over Tor isn't going to get you the privacy that you might want.

So what's the fix? There are two answers here. The first answer is "don't run Bittorrent over Tor". We've been saying for years not to run Bittorrent over Tor, because the Tor network can't handle the load; perhaps these attacks will convince more people to listen. The second answer is that if you want your Bittorrent client to actually provide privacy when using a proxy, you need to get the application and protocol developers to fix their applications and protocols. Tor can't keep you safe if your applications leak your identity.

The third attack from their paper is where things get interesting. For efficiency, Tor puts multiple application streams over each circuit. This approach improves efficiency because we don't have to waste time and overhead making a new circuit for every tiny picture on the aol.com frontpage, and it improves anonymity because every time you build a new path through the Tor network, you increase the odds that one of the paths you've built is observable by an attacker. But the downside is that exit relays can build short snapshots of user profiles based on all the streams they see coming out of a given circuit. If one of those streams identifies the user, the exit relay knows that the rest of those streams belong to that user too.

The result? If you're using Bittorrent over Tor, and you're _also_ browsing the web over Tor at the same time, then the above attacks allow an attacking exit relay to break the anonymity of some of your web traffic.

What's the fix? The same two fixes as before: don't run Bittorrent over Tor, and/or get your Bittorrent developers to fix their applications.

But as Tor developers, this attack opens up an opportunity for a third fix. Is there a way that we as Tor can reduce the damage that users can do to themselves when they use insecure applications over Tor? We can't solve the fact that you'll shoot yourself in the foot if you use Bittorrent over Tor, but maybe we can still save the rest of the leg.

One approach to addressing this problem in Tor's design is to make each user application use a separate circuit. In Linux and Unix, we can probably hack something like that up -- there are ways to look up the pid (process ID) of the application connecting to our socket. I suspect it gets harder in Windows though. It also gets harder because many Tor applications use an intermediate http proxy, like Polipo or Privoxy, and we'd have to teach these other proxies how to distinguish between different applications and then pass that information along to Tor.

Another answer is to separate streams by destination port. Then all the streams that go to port 80 are on one circuit, and a stream for a different destination port goes on another circuit. We've had that idea lurking in the background for a long time now, but it's actually because of Bittorrent that we haven't implemented it: if a BT client asks us to make 50 streams to 50 different destination ports, I don't want the Tor client to try to make 50 different circuits. That puts too much load on the network. I guess we could special-case it by separating "80" and "not 80", but I'm not sure how effective that would be in practice, first since many other ports (IM, SSH, etc) would want to be special-cased, and second since firewalls are pressuring more and more of the Internet to go over port 80 these days.

We should keep brainstorming about ways to protect users even when their applications are handing over their sensitive information. But in the mean time, I think it's great that these researchers are publishing their results and letting everybody else evaluate the attacks. (If you're a researcher working on Tor attacks or defenses, check out our new research resources page.) The attacks in this paper are serious attacks if you're a Bittorrent user and you're hoping to have some privacy.
https://blog.torproject.org/blog/bit...isnt-good-idea

Until next week,

- js.

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