Peer-To-Peer News - The Week In Review - June 4th, '05

[JackSpratts]

Early Edition


Quotes Of The Week


"An invocation of terrorism, the trump card of modern American politics, could ease the passage of the next major expansion of copyright powers." – Declan McCullagh


"This is a critical moment in Europe's history." - Jean-Luc Dehaene


"Underneath all this there is a more profound question, which is about the future of Europe and, in particular, the future of the European economy and how we deal with the modern questions of globalization and technological change." – Tony Blair


"If I want to watch a movie I can just rent it on DVD. I want to do things that conform to my time frame, not someone else's." - Matthew Khalil


"When people started using synthesizers, we didn't throw out our pianos." – Stephanie Gray


"The bottom line in this is, this is about a lot more than pornography. It's voluntary until it's not voluntary." - Lauren Weinstein









NON! NON!

Said the French as they buried the European constitution along with their political ennui. From nervous plutocrats to shaky soothsayers everyone obsessed on the meaning of the outcome this week but one thing is clear: Top-Down Government isn’t cutting it these days and the people are – finally – letting their leaders know it loudly and clearly the minute they have the chance to be heard. The French aren’t the only ones. We are witnessing the gradual awakening of a new political consciousness in Western Europe. Just days after French voters exercised their ballot boxes people in the Netherlands rejected the same constitution by an even wider margin with their own chorus of "Nees!" I don’t imagine the specifics of the document are at issue, it seems fairly tame as constitutions go, even if you really ought to have a country if you’re going adopt one. The real issue is anger at a government corrupted by untouchable corporations controlled by powerful families allied against the people. In a sense this weeks vote was a referendum on modern feudalism, glossingly referred to as globalism, and Europeans think that voting for globalization is like voting for hunting – when you’re the duck. The message was one of citizen to clueless leader: Don’t ignore our needs, don’t pass laws that hurt us, don’t take us for granted. Like the arrogance of "copyright reforms" that are nothing but handouts to rich cartels imposing brutal punishments on people for innocuous behaviors such as file-sharing among friends; bureaucrats shoving menacing laws down the throats of the public is a danger we’re witnessing all too often and it’s raising the hairs on the necks of millions of normal citizens who vote in large numbers as can now be plainly seen.

So the heart speeds and the paper drops. The vote is cast, and one thanks God or whatever one thanks that such a thing as Democracy exists and we live under it, and like the other important things in life, is so much the better for us when we give it a good workout.













Enjoy,

Jack












Music Industry Tailed Sharman Boss
Kristyn Maslog-Levis

The Australian music industry's piracy investigations unit conducted extensive surveillance of the Sydney north shore house owned by the chief executive officer of peer-to-peer provider Sharman Networks, the unit's former boss told a court hearing last week.

Michael Speck, a representative of Music Industry Piracy Investigations, told a federal court hearing on Tuesday that the antipiracy unit had been "tailing" Nikki Hemming's premises on a "continuous basis" for several months until 11 a.m. on May 24.

The unit conducted the surveillance as part of its efforts to determine who controlled the peer-to-peer software Kazaa. The issue is key to the music industry's litigation against Sharman Networks, associated companies and individuals over alleged copyright-infringing behavior.

Speck said in an interview that "personal surveillance" of Hemming had been conducted but finished some time ago.

"She personally wasn't a subject, rather the premises associated with her were. Conducting an investigation into a shadowy organization hiding behind a veil of secrecy and surveillance is a normal practice," he said.

Speck told Sharman's solicitors that he ordered the surveillance of Hemming's premises to stop after finding out where the general manager had moved to.

"Given the nature of Kazaa, we conducted a range of investigations aimed at getting to the bottom of who controlled Kazaa. We stopped the surveillance when we confirmed her new address. We're not conducting any surveillance at present," he said.

Hemming sold her house in Castle Cove to Sharman accountant John Myers for $1.6 million (AU$2.1 million) in late February 2005.

Speck said in court that "it serves no purpose" for the unit to keep digging to find out the identity of the true owners of the peer-to-peer organization as it had garnered enough evidence to assert in court who the true owners and controllers were.

"We are not interested, because we have come to a conclusion that we are very confident about. We have consistently asserted that Hemming controls the Sharman companies; we have asserted that to the court," Speck said.

The industry has asserted that while Hemming controls Sharman Networks and Sharman License Holdings, Altnet Chief Executive Officer Kevin Bermeister is the true controller of the Kazaa software. Altnet, which sells music and other digital products through peer-to-peer networks, signed a joint venture with the Sharman companies in 2002.

The record industry plans to continue pressing for an order to put Hemming on the witness stand for cross-examination. The case resumes on June 8.
http://news.com.com/Music+industry+t...3-5726297.html


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The MPAA Really Is Watching You
John Borland

The Motion Picture Association of America said Tuesday that it will fund the installation of 10 new surveillance cameras in downtown Los Angeles--ostensibly to help catch ne'er-do-wells who are selling counterfeit DVDs on the streets.

But don't worry, it will be the city police department watching the close-circuit screens, not Hollywood piracy enforcers. I presume that the resolution on the new cameras will be good enough to detect the subtle differences between actual counterfeits and used DVDs, which are legal to sell under the first sale doctrine.

But why stop there? Since Hollywood is putting up the $186,000 to set up the pole-mounted cameras, studios should own the copyright to the resulting videos. Just think of the opportunities for new reality TV shows, live from the gritty streets of LA. Or pay-per-bust Webcams, perfect for the nation riveted by COPS reruns and OJ's slow-speed Bronco chase. Who said Hollywood was technologically behind the times?
http://news.com.com/2061-10802_3-5726874.html?tag=tb


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A Future With Nowhere to Hide?

This connectedness may lead toward a future where our cell phones track us like FedEx packages, sometimes when we're not aware
Steven Levy

We're all too familiar with the concept of technology as a double-edged sword, and wireless is no exception. In fact, the back edge of this rapier is sharp enough to draw blood. Yes, the idea of shedding wires and cables is exhilarating: we can go anywhere and still maintain intimate contact with our work, our loved ones and our real-time sports scores. But the same persistent connectedness may well lead us toward a future where our cell phones tag and track us like FedEx packages, sometimes voluntarily and sometimes when we're not aware.

To see how this might work, check out Worktrack, a product of Aligo, a Mountain View, Calif., producer of "mobile services." The system is sold to employers who want to automate and verify digital time-logs of their workers in the field. The first customers are in the heating and air-conditioning business. Workers have cell phones equipped with GPS that pinpoint their locations to computers in the back office. Their peregrinations can be checked against the "Geo Fence" that employers draw up, circumscribing the area where their work is situated. (This sounds uncomfortably like the pet-control technology, those "invisible fences" that give Rover a good stiff shock if he ventures beyond the backyard.)

"It they're not in the right area, they're really not working," says Aligo CEO Robert Smith. "A notification will come to the back office that they're not where they should be." The system also tracks how fast the workers drive, so the employer can verify to insurance companies that no one is speeding. All of this is perfectly legal, of course, as employers have the right to monitor their workers. Smith says that workers like the technology because it insures they get credit for the time they spend on the job.

Worktrack is only one of a number of services devoted to tracking humans. Parents use similar schemes to make sure their kids are safe, and many drivers are already allowing safety monitors to keep GPS tabs on their travels (OnStar anyone?). Look for the practice to really explode as mobile- phone makers comply with an FCC "E911" mandate dictating that by the end of 2005 all handsets must include GPS that pinpoints the owner's location.

The prospect of being tracked "turns the freedom of mobile telephony upside down," says Marc Rotenberg of the Electronic Privacy Information Center. His concern is government surveillance and the storage of one's movements in databases. In fact, if information from the GPS signals is retained, it would be trivial to retain a log of an individual's movements over a period of years (just as phone records are kept). An even darker view is proposed by two academics who wrote a paper warning the advent of "geoslavery'." Its definition is "a practice in which one entity, the master, coercively or surreptitiously monitors and exerts control over the physical location of another individual to routinely control time, location, speed and direction for each and every movement of the slave."

My guess is that the widespread adoption of tracking won't be done against our will but initially with our consent. As with other double-edged tools, the benefits will be immediately apparent, while the privacy drawbacks emerge gradually. The first attraction will be based on fear: in addition to employers' keeping workers in tow, Mom and Dad will insist their teenagers have GPS devices so parents can follow them throughout their day, a human equivalent of the LoJack system to find stolen cars. The second stage will come as location-based services, from navigation to "friend-finding" (some systems tell you when online buddies are in shouting range) make our lives more efficient and pleasurable.

Sooner or later, though, it will dawn on us that information drawn from our movements has compromised our "locational privacy"—a term that may become familiar only when the quality it refers to is lost. "I don't see much that will bring it about [protections] in the short term," says Mark Monmonier, author of "Spying With Maps." He thinks that that we'll only get serious about this after we suffer some egregious privacy violations. But if nothing is done, pursuing our love affair with wireless will result in the loss of a hitherto unheralded freedom—the license to get lost. Here's a new battle cry for the wireless era: Don't Geo-Fence me in.
http://www.msnbc.msn.com/id/5086975/site/newsweek/


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Federal Report Warns Of RFID Misuses
Declan McCullagh

Radio frequency identification is becoming increasingly popular inside the U.S. government, but agencies have not seriously considered the privacy risks, federal auditors said.

In a report published Friday, the Government Accountability Office said that 13 of the largest federal agencies are already using RFID or plan to use it. But only one of 23 agencies polled by the GAO had identified any legal or privacy issues--even though three admitted RFID would let them track employee movements.

"Key security issues include protecting the confidentiality, integrity and availability of the data and information systems," the GAO said. "The privacy issues include notifying consumers; tracking an individual's movements; profiling an individual's habits, tastes and predilections; and allowing for secondary uses of information."

RFID is a catchall term for a broad array of technologies that includes everything from battery-powered "active" tags, such as those used in highway toll booths, to "passive" RFID tags that measure a fraction of a millimeter in each dimension, not counting the antenna in the device.

Agencies already are experimenting with passive RFID technology. Among the list of planned or actual uses: the Department of Defense for tracking shipments; the Department of Homeland Security for immigration and baggage tracking; the State Department for electronic passports; the Department of Veterans Affairs for "audible prescription reading."

In addition, under the Real ID Act, the Department of Homeland Security is responsible for designing a standardized ID card that could be RFID-outfitted.

Few privacy concerns exist when RFID is used merely to track warehouse pallets. But when RFID chips are embedded in ID cards or otherwise linked to personal information, the GAO warned, the privacy risks increase dramatically.

"Consumers have raised concerns about whether certain collected data might reveal personal information such as medical predispositions or personal health histories and that the use of this information could result in denial of insurance coverage or employment to the individual," the report said. "For example, the use of RFID technology to track over-the-counter or prescription medicines has generated substantial controversy."

California's Senate this month approved a ban on the use of RFID tags in driver's licenses and other state-issued forms of identification.
http://news.com.com/Federal+report+w...3-5723535.html


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Researchers Aim To Protect DVDs with RFID
John P. Mello Jr.

On the drawing board is a system that would embed an RFID tag into a DVD. Today those tags are used for everything from inventory control at Wal-Mart to paying for gasoline at Exxon/ Mobil stations. The tagged DVD would have to be played in a DVD player with hardware for reading the information in the tag.

Ask any box office expert to name the holy trinity of movie attendance and they'll tell you: big screen, big sound and immediacy -- getting to see a movie when it's released.

With improving home entertainment systems rapidly undermining the first two tenets of attendance, how long will it be before the third leg of the triangle falls? No one knows. However, if it does, some researchers at UCLA plan to be there to catch it.

The group -- part of the university's Wireless Internet for the Mobile Enterprise Consortium (WINMEC) -- is working on a Digital Rights Management (DRM) scheme that uses Radio Frequency Identification (RFID) to prevent the unauthorized use and copying of movie DVDs.

Prototype Soon

According to WINMEC Director Rajit Gadh, initial research on the hardware and software system has been completed and a prototype is in the works. "We should have a prototype by the end of the summer," he told TechNewsWorld.

On the drawing board is a system that would embed an RFID tag into a DVD. Today those tags are used for everything from inventory control at Wal- Mart to paying for gasoline at Exxon/Mobil stations.

The tagged DVD would have to be played in a DVD player with hardware for reading the information in the tag. That information would be controlled by the owners of the content on the disc.

The technology, theoretically, would provide a secure way to distribute movies so Hollywood would be able to feel confident about distributing DVDs of movies as they're released in theaters.

How does Hollywood make money: sale of the DVDs, which will cost more than conventional DVDs, and, theoretically, by gaining consumers who would not be going to theaters for first-run movies because they have elaborate home entertainment systems.

Middle Ground Solution

Gadh explained that the proposed system lies in the middle ground of a DRM spectrum running from totally unencumbered use of digital content to use restricted to a single hardware device.

"This solution is a bit tighter than the completely-free-for-all solution, but it's a little looser than being tied down to one player and one user," he said.

Asked if the RFID approach was better than existing DRM schemes or would thwart piracy of DVD content, Gadh replied: "This is yet another technology that can be available eventually to studios that would allow another distribution mechanism of the content. In terms of piracy and all, I don't know what effect it could have on piracy."

Better for Pirates?

However, Rob Enderle, president and principal analyst with the Enderle Group in San Jose, Calif., asserted that while RFID might be tough to crack, it won't make entertainment executives feel less anxious about releasing DVDs of movies as they appear in theaters.

He explained that RFID might foil digital pirates, but not analog ones. Instead of taping a movie off the big screen, they'll tape it off a HDTV or computer display. "That will probably prevent the adoption of this for first-run films as the content owners will be reluctant to provide a media form that will make it easier than filming in theaters currently is," he told TechNewsWorld via e- mail.

Some DRM experts are very skeptical of using an RFID solution to manage the content of DVDs.

"While there are some benefits to such a system, I'm not sure they outweigh the problems," Ray Wagner, research vice president for the Gartner Group in Stamford, Conn., told TechNewsWorld via e-mail. "I'd say that in my opinion, this solution does not, at first blush, look like a winner."

Waving DRM Flag

Vamsi M. Sistla, director of broadband and digital media at ABI Research in Oyster Bay, N.Y., questioned the viability of the technology in the market. "There are just too many barriers to get this technology to the marketplace," he told TechNewsWorld.

While using RFID as a DRM vehicle is just getting off the ground, he explained, other technologies, such as a DVD version of the "broadcast flag," are already in an advanced stage of development. The flag approach would create DVD players that would only read discs that contained codes proving their authenticity.

Ted Schadler, a principle analyst with Forrester Research in Boston, explained in an e-mail to TechNewsWorld that the next generation of DVD disc will use a technology called broadcast encryption , developed by IBM, Sony, Intel, Microsoft, Disney and others to accomplish the same goal as what's proposed in the RFID scheme.

Too Many Hurdles

Another hurdle for an RFID system, he contends, is the need for a network connection to plug into a database of access privileges. "This eliminates today's DVDs and DVD players from participating," he said. "That means that a new DVD player technology would have to be built -- and networked."

Jarad Carleton, an IT industry analyst with Frost & Sullivan in Palo Alto, Calif., told TechNewsWorld via e-mail, "No matter how I view this proposed solution to the movie pirating problem, I see very high business hurdles that I don't think can be overcome."

"Remember DIVX DVD rentals?" he asked. "If UCLA works out the technology for this and it eventually hits the market, I predict a similar market rejection."

"Pirated movies are prevalent around the world for one reason and one reason only -- money," he declared. "When you pay $10 or more to see a movie and it's a bad film, you feel robbed, and frankly, you have been robbed."
http://www.technewsworld.com/rsstory/43186.html


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EU Commission Says To Propose Phone Data Logging
Huw Jones

The European Commission will propose mandatory logging by phone companies and internet providers of all emails, telephone calls and other electronic communication, Viviane Reding, the Commissioner for Information Society and Media, said on Tuesday.

"In the next coming days there will be a proposal," Reding told a telecoms industry conference.

She will make the legislative proposal jointly with EU Justice, Freedom and Security Commissioner Franco Frattini, but the step could spark a clash with some member states.

France, Ireland, the UK and Sweden made a similar proposal in April last year in the aftermath of the Madrid train bombings, which killed 191 people. The seizure of phone records was credited with helping police make quick arrests.

The European Union's council of ministers, which represents member states, wants all telecommunications data to be stored for a year to help the police solve terrorist and other crimes, and put forward a proposal on this last year.

The actual content of conversations, text messages or emails would not be kept. Records are currently kept for three months by telephone companies for billing purposes.

"We are glad the debate is being reopened again," said Michael Bartholomew, director of the European Telecommunications Network Operators' Association (ETNO).

"There is a question of privacy. All of this costs money and nobody has addressed that properly. If you are going to spend hours and hours tracking down data, who is going to pay for it," Bartholomew said on the sidelines of a telecoms conference.

Internal Market

Reding said she shared the overall objective in the member states' bill, but that EU harmonisation of any data retention obligations should be for the Commission to propose rather than member states as it concerned the EU's internal market.

The member state proposal took no account of views at the Commission, the European Parliament or industry.

A proposal by the Commission would have to be agreed by the European Parliament and member states, making the process more transparent, she said.

"This will help find the right balance not only in terms of privacy and consumer confidence, but also in terms of cost for the industry," Reding said.

The Commission would also request an analysis of the impact legislation would have so that a bill is proportionate, Reding said.

When asked by Reuters if the four member states were now expected to withdraw their data retention bill, Reding replied: "I have no idea. There is no sense to have a proposal made by part of the European Union."

Reding said the Commission was anxious to avoid distorting the internal market by uneven application of the member state bill.

But EU diplomats say justice and interior ministers may agree their own proposals they put forward last year when they meet in Luxembourg this week, if they can agree on some outstanding issues such as how long data should be stored.

Also outstanding is what data must be stored, for example both made calls and unsuccessful calls, data protection and the obligation on member states to share information in cross-border cases, the diplomats said.

Civil rights activists, telecom and Internet firms want the member state bill scrapped or diluted substantially as they say it would be overly intrusive, costly and technically difficult.
http://uk.news.yahoo.com/050531/80/fk65h.html


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Rule requires destruction of consumer data

Federal Law on Disposal of Sensitive Information Aims to Hinder Identity Theft
Caroline E. Mayer

Be careful how you -- or your company -- dispose of sensitive consumer information.

A new federal rule that took effect yesterday requires all businesses and individuals to destroy private consumer information obtained from
credit bureaus and other information providers in determining whether to grant credit, hire employees or rent an apartment.

Issued under orders from Congress, which was trying to crack down on identity theft, the Federal Trade Commission's new rule requires that personal information be burned, pulverized, shredded or destroyed in such a way that the information cannot be read or reconstructed. The rule also applies to electronic files, which must be erased or destroyed, and covers credit report data, credit scores, employment histories, insurance claims, check-writing histories, residential or tenant history and medical information.

An FTC official said failure to properly dispose of the data could draw a $2,500 federal penalty per violation, as well as lawsuits from people who could seek damages if personal information was misused as a result of improper disposal.

The rule applies to large and small companies -- to lenders and insurers, as well as landlords, car dealers, attorneys and private investigators. Individuals who use credit reports -- to hire nannies or contractors, for example -- also are subject to the new rule.

The agency does not set a time limit for when the data must be destroyed, only ground rules for disposing of it. Nor does the agency set rules on how securely data must be kept until it is destroyed, although some laws already provide such rules for financial and medical institutions.

Privacy advocates applauded the new rules. "This requirement is long overdue and will hopefully make companies think twice about how valuable this information is" in all of their conduct, said Evan Hendricks, editor and publisher of Privacy Times newsletter.
http://www.washingtonpost.com/wp-dyn...rss_technology


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Sweden

First Conviction For File-Sharing

Oslo municipal court sentenced a 36-year-old man from Oppland County for running an illegal file sharing service on the Internet, the first conviction of its type in Norway.

The court ruled that the man had willingly and knowingly made a significant number of film and music files available for at least 300 people at a time and had violated copyright law, newspaper VG reports.

The Sandefjord man placed material on his employer's (telecom company NetCom's) server to facilitate transfer. A police raid revealed more than 60,000 pirated film and music files.

Before the case went to trial representatives for the Norwegian recording industry signaled that they could sue for compensation if a guilty verdict was returned.
http://www.aftenposten.no/english/lo...cle1050773.ece


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Spaniards Stick Sword In P2P Website
Lester Haines

Spanish P2P music website Weblisten is - as of right now - closed by order of the 3rd Criminal Court of Madrid for intellectual property violations.

The judgement, as recorded on Libertad Digital (Digital Freedom), prohibits Weblisten from further music distribution activities, and orders the destruction of those databases which "contain music files and other material pertaining to the offence". The sentence concludes by explaining that it "clarifies the scope of internet music distribution and decisively contributes to the promotion of quality, legal distribution".

Indeed, a notice on the Weblisten website reads: "WARNING: This Website has been closed following the legal procedure at the Juzgado de lo Penal nº 3 of Madrid. For any claim, please contact us at: Weblisten, S.A., Post Office Box nº 6148, 28080 Madrid - Spain."

Weblisten set up shop in 1997 and has on several occasions attracted the attention of Spanish intellectual property outfit AGEDI (That's the Asociación de Gestión de Derechos Intelectuales for those readers who like their watchdogs with an Iberian flavour). Weblisten's demise provoked AGEDI prez Antonio Guisasola to pronounce that "justice has been served by this judgement, stopping as it does the activity of a website which has become rich by illegal and malicious means at the expense of producers and artists, robbing them of their rights and not paying to exploit the fruits of their labours".
http://www.theregister.co.uk/2005/06...isten_cerrado/


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Privacy's The Point: File Sharing Decision Stops Big Music From Playing Big Brother
Michael Geist

In an age when the media analyzes legal decisions on the basis of winners and losers, the recent Federal Court appellate decision over music file sharing left many people a bit bewildered. The court described the decision as a divided success, newspaper headlines trumpeted it as a loss for the music industry, while the Canadian Recording Industry Association declared total victory. Actually, years from now this case will be remembered not for who won or lost, but rather for its impact on privacy law and copyright policy.

On May 19th, the Federal Court of Appeal released its ruling on CRIA's effort to compel five of Canada's largest Internet service providers to reveal the identities of 29 of their customers. Those customers are alleged to have infringed copyright by allowing other Internet users to download songs from their computers on peer-to-peer networks.

Last year, a federal court dismissed CRIA's motion, citing unreliable evidence, privacy concerns, and doubts that the impugned activity violated Canadian copyright law. At one level, the rejection of CRIA's appeal is easy to understand. Quite simply, the appellate court upheld the earlier decision since it was unwilling to rehabilitate what even CRIA has acknowledged was "evidentiary deficiencies."

The court's analysis did not stop there, however. It provided a cursory review of key copyright issues but declined to arrive at any firm conclusions. In other words, claims that the court ruled that file sharing is either legal or illegal are inaccurate. Tthat question has been left for another day.

Next week I will focus on the decision's copyright policy ramifications. Meanwhile, the court's discussion concerning the development of a privacy framework merits further analysis.

Although some parties have sought to downplay the centrality of privacy to the case, the court opened its discussion by calling attention to the tension between privacy and copyright. It noted that "citizens legitimately worry about encroachment upon their privacy rights. The potential for unwarranted intrusion into individual personal lives is now unparalleled. In an era where people perform many tasks over the Internet, it is possible to learn where one works, resides or shops, his or her financial information, the publications one reads and subscribes to and even specific newspaper articles he or she has browsed."

This comment, alongside similar wording last summer from Justice Louis LeBel of the Supreme Court of Canada, sends an unequivocal message from Canada's highest courts that Internet privacy involves highly sensitive information that deserves strong legal protection.

Just how strong became apparent later in the judgment. While the court acknowledged the obvious -- privacy rights are not absolute and must sometimes take a back seat to other interests -- it proceeded to establish a rigorous test designed to provide significant privacy protections.

The test requires a plaintiff such as CRIA to first demonstrate that it has a "bona fide" claim based on evidence that it has obtained (not merely that it intends to file a lawsuit) and that it has no other improper purposes for seeking the identities of subscribers. CRIA must show that the information cannot be obtained from another source and tender evidence that is admissible, timely, and links the Internet protocol addresses of the subscribers to the alleged infringement.

The importance of each of these evidentiary requirements should not be underestimated. In addressing the deficiencies of this particular case, the court warned that relying on faulty evidence created "the risk that innocent persons might have their privacy invaded and also be named as defendants where it is not warranted."

Assuming that the evidentiary hurdles are met, the test then requires courts to determine whether the public interest in disclosure outweighs the privacy interests that are at stake. If the court determines that disclosure is appropriate, it must ensure that privacy rights are invaded "in the most minimal way" such that CRIA must collect no more information than is necessary for the purpose of the claim. The court recommended that judges provide specific directions on how the information can be used and also consider keeping the information from the broader public by issuing a confidentiality order or identifying the defendants solely by their initials.

With CRIA indicating plans to proceed with a fresh round of lawsuits, the effectiveness of these privacy protections will quickly be tested. While federal court judges will ultimately weigh the public interest considerations, other parties share responsibility for protecting Internet privacy.

Internet service providers, many of whom have proclaimed support for customer privacy, have an obligation to play active role in any future lawsuits by rapidly notifying their customers and raising privacy issues with the court. Moreover, the Privacy Commissioner of Canada would do well to consider intervening in future cases since the issues at stake sit at the heart of the Commissioner's mandate.

Ultimately, CRIA should also assess the privacy ramifications of its proposed actions. While it is legally entitled to file these suits, similar actions in other jurisdictions have had no discernable impact on file sharing and put the industry at odds with the growing concern for personal privacy. That makes for a risky strategy with few winners and many losers.
http://www.canada.com/technology/sto...6-0162ce4e080d


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China's Tech Revolution

A special report looks at how technology is driving China's emergence as an industrial powerhouse -- and what that means for the world.

Barely 25 years after emerging from the turmoil of Maoist rule, China today is bestriding the world as a technological colossus, according to a special report in the June 2005 issue of IEEE Spectrum.

China's heft is felt worldwide in nearly every sector and along the entire chain of economic activity. The country's ravenous appetite for energy and raw materials is influencing commodity markets in every continent. In the special report, "China's Tech Revolution," the editors of Spectrum focus on how technology is driving this unprecedented boom.

Among the topics explored:

* How a long-overdue upgrade to China's Internet will either aid or thwart the central government's strict censorship policies.
* How consumer electronics companies are racing to roll out digital television by the 2008 Beijing Olympics.
* How electric bicycles are selling by the millions in China, and challenging the country's encroaching car culture.
* How Taiwanese semiconductor manufacturers are flocking to the mainland, but could risk losing their lead to domestic chipmakers.

The report also looks at the potentially explosive social and economic problems, any one of which could slow or even halt progress--rural and labor unrest, wholesale intellectual property theft, chronic energy shortfalls and pollution, and volatile relationships with many of China's main trading partners.
http://www.newswise.com/articles/view/512141/?sc=swtn


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Federal Law Enforcement Cracks Down on P2P Piracy Network
News Staff

On Wednesday, federal officials announced the first criminal enforcement action targeting individuals committing copyright infringement on peer-to-peer (P2P) networks using cutting edge file-sharing technology known as BitTorrent.

Agents of the FBI and U.S. Immigration and Customs Enforcement (ICE) executed 10 search warrants across the United States against leading members of a technologically sophisticated P2P network known as Elite Torrents. Employing technology known as BitTorrent, the Elite Torrents network attracted more than 133,000 members and, in the last four months, allegedly facilitated the illegal distribution of more than 17,800 titles-including movies and software-which were downloaded 2.1 million times.

In addition to executing 10 warrants, federal agents also took control of the main server that coordinated all file-sharing activity on the Elite Torrents network. Anyone attempting to log on to Elitetorrents.org will receive the following message: "This Site Has been Permanently Shut Down by the Federal Bureau of Investigation and U.S. Immigration and Customs Enforcement."

"Our goal is to shut down as much of this illegal operation as quickly as possible to stem the serious financial damage to the victims of this high-tech piracy-the people who labor to produce these copyrighted products," said Acting Assistant Attorney General Richter of the Criminal Division. "Today's crackdown sends a clear and unmistakable message to anyone involved in the online theft of copyrighted works that they cannot hide behind new technology."

"Internet pirates cost U.S. industry hundreds of billions of dollars in lost revenue every year from the illegal sale of copyrighted goods and new online file-sharing technologies make their job even easier," said Assistant Secretary Garcia, Homeland Security Assistant Secretary for Immigration and Customs Enforcement. "Through today's landmark enforcement actions, ICE and the FBI have shut down a group of online criminals who were using legitimate technology to create one-stop shopping for the illegal sharing of movies, games, software and music."

Building on the success of Operation Gridlock, a similar takedown announced by federal law enforcement last August that has already led to the felony convictions of three P2P copyright thieves, Operation D-Elite targeted the administrators and "first providers" or suppliers of copyrighted content to the Elite Torrents network. By utilizing BitTorrent, the newest generation of P2P technology, Elite Torrents members could download even the largest files-such as those associated with movies and software-far faster than was possible using more traditional P2P technology.

The content selection available on the Elite Torrents network was virtually unlimited and often included illegal copies of copyrighted works before they were available in retail stores or movie theatres. For example, the final entry in the Star Wars series, "Episode III: Revenge of the Sith," was available for downloading on the network more than six hours before it was first shown in theatres. In the next 24 hours, it was downloaded more than 10,000 times.

Operation D-Elite is being conducted jointly by ICE and the FBI as part of the Computer And Technology Crime High Tech Response Team (CATCH), a San Diego task force of specially trained prosecutors and law enforcement officers who focus on high-tech crime. Federal and state member agencies of CATCH include the ICE, the FBI, the Department of Justice, the San Diego District Attorney's Office, San Diego Police Department, the San Diego Sheriff's Department, and San Diego County Probation.

Operation D-Elite was coordinated and will be prosecuted by the Justice Department's Computer Crime and Intellectual Property Section, with the assistance and support of Computer Hacking and Intellectual Property (CHIP) coordinators in San Diego and U.S. Attorneys' Offices in Arizona, Illinois, Kansas, Ohio, Pennsylvania, Texas, Virginia and Wisconsin.

The Motion Picture Association of America provided valuable assistance to the investigation.
http://www.govtech.net/news/story.print.php?id=94129


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Growth Of Stolen Music Continues
Lisa DiCarlo

It's certainly no secret that Apple Computer's iPod is the bestselling digital music player. The company has shipped nearly 12 million iPods in just the last three quarters, representing three consecutive quarters of growth of 500% or higher.

It's also no secret that Apple is a champion of legal downloading. Peer-to-peer (illegal) music downloading didn't grow at 500%, but it does continue to grow steadily despite low-priced music subscription services and an acceleration in sales of the iPod, which which was designed to work with Apple’s proprietary (and legal) iTunes music store.

According to the NPD Group, consumers purchased 25.9 million songs in March 2005, 52% more than they bought a year ago. Consumers also downloaded more than 242 million songs illegally this March, up 25% from March 2004.

It will be interesting to gauge the impact of the low-priced Yahoo! Music Unlimited service on peer-to-peer growth. Yahoo's subscription service has an introductory price of only $6.99 per month, half as much a streaming service offered by Real Networks. Yahoo hasn't disclosed when the price would rise, or by how much.

Pacific Crest Securities believes that Yahoo's service "significantly changes the dynamics of the digital music industry."

Maybe so. But as long as peer-to-peer networking exists, people will steal music. The best music labels and legal services can really hope for is a slowdown in growth, which already appears to be happening.
http://www.forbes.com/digitalenterta..._0601stat.html


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France's Rejection of E.U. Charter Emboldens Opponents
Elaine Sciolino

The shock waves of France's rejection of a constitution for Europe reverberated throughout the Continent on Monday, with Britain suggesting that it might cancel its own popular vote on the document and the naysayers in the Netherlands gaining even more confidence that a no vote will prevail in a referendum there on Wednesday.

In France, the vote plunged the center-right government into crisis. President Jacques Chirac will announce "decisions concerning the government" and make a declaration on French television on Tuesday.

The statement was interpreted to mean that he would dismiss Prime Minister Jean-Pierre Raffarin and reshuffle his cabinet as a direct result of the repudiation of Mr. Chirac's leadership in a referendum on the European Union constitution on Sunday.

There has been open speculation for months that Mr. Raffarin would be replaced if the constitution failed in France, and after a 30-minute meeting with Mr. Chirac in Élysée Palace on Monday, the affable but unpopular prime minister said, "There will be developments today or tomorrow."

He declined to say whether he had offered his resignation, telling reporters: "I'm going for a stroll around Paris. See you later."

The euro fell sharply on Monday as traders in the United States sold the currency a day after the French vote, slipping to a seven-month low of about $1.25 in late afternoon trading.

Farmers, workers and the unemployed were among those who led the way to the defeat of the European Union constitution in France, voting no in high numbers largely over concerns about the economy. European leaders who had promoted the constitution as the logical, if revolutionary, next step in the growth and unification of the 25-member bloc could not hide their disappointment.

The most serious potential foreign fallout from the no vote in France came on Monday from Prime Minister Tony Blair of Britain, who called for a "time for reflection," saying it was too early to decide whether a popular vote could go ahead in his country.

"Underneath all this there is a more profound question, which is about the future of Europe and, in particular, the future of the European economy and how we deal with the modern questions of globalization and technological change," Mr. Blair told journalists during a vacation in Italy. Nine European Union members ratified the constitution before the French referendum. But France's no vote is likely to kill the constitution - at least in its current form - because it requires approval by all of the union's member countries.

In a sense, consideration of the constitution by other member countries, including the Dutch vote on Wednesday, is only a political exercise in democracy to allow each of them the right to proclaim approval or rejection. But the Dutch vote is important nonetheless.

At the moment there is no plan to revise the constitution and put it before member states again. If the Dutch also reject the constitution, it would be that much harder to persuade the rest of the member states to go forward with putting any document up for ratification, particularly those that plan to do it by popular vote.

"This is a critical moment in Europe's history," said Jean-Luc Dehaene, a former Belgian prime minister and one of the architects of the constitution, in a telephone interview. "It is clear that the French no brings Europe to a kind of standstill." The French, he said, "are completely without orientation and in a period of complete uncertainty."

The Netherlands, which like France was one of the six founding members of Europe's original union, "will not be in a position to play its leadership role in Europe if it votes no," Mr. Dehaene said. As for Britain, he added, "It is not impossible that the British government will hide behind the back of France to avoid the difficult discussion in Britain."

For the time being, the British foreign secretary, Jack Straw, said he would announce a decision on whether to go ahead with a vote no earlier than next week.

Mr. Blair's tentative remarks contrasted with the bold approach taken by other European leaders, including Chancellor Gerhard Schröder of Germany and Prime Minister Jean-Claude Juncker of Luxembourg, who said the ratification process must go on despite the French vote.

"Life continues," Javier Solana, the European Union's foreign policy chief, said at ld a news conference at the union's headquarters in Brussels after France's repudiation of the treaty. "For me, the worst that could happen is if, as a consequence of that, you or the citizens of the European Union or the leaders of the European Union enter into a zone of paralysis psychologically."

In Washington, the State Department, in a brief statement on the vote, emphasized continuity in trans-Atlantic relations, not concern. The administration has remained aloof from the particulars of the constitutional debate.

"We welcome a strong, integrated Europe that is an effective partner for addressing the many challenges we face together," said a spokesman, Noel Clay. "We have such a partnership now with the European Union and expect to continue to build on this relationship, however the E.U. evolves."

The constitution is intended to provide an ambitious, streamlined system for growth and greater unity in the newly expanded 25-country bloc. If the document is abandoned, member states will have to continue working together under a cumbersome and limiting array of existing treaties and rules adopted when the union was smaller.

In an effort to salvage the European unification process, some European figures were sugarcoating their earlier dire predictions of the consequences of the French veto.

Not long ago, for example, Romano Prodi, the former president of the European Commission, had predicted that a French no would mean "the end of Europe." On Monday he called the outcome "a disaster," but insisted that the union would continue to function under current rules and that things could be worse.

"This is still better than a war of secession like the United States once had," he said in a telephone interview. "I'm serious now. We must keep this perspective in mind. We don't have a treaty, but we also don't have wars."

That is certainly true, but the lowest-common-denominator approach was not what the leaders of Europe had in mind when they embarked on the drafting of the constitution, a process that took two and a half years.

After the French vote, the European Commission president, José Manuel Durão Barroso, warned of "a risk of contagion."

Indeed, contagion could come as early as Wednesday, when voters in the Netherlands go to the polls to pass judgment on the constitution.

After the French vote, the Dutch prime minister, Jan Peter Balkenende, told reporters, "The Dutch, of course, do not take any orders from France." But a new Dutch poll taken after the French vote and made public on Monday for NOS public television showed an increase in voters intending to vote no to 55 percent, up from 51 percent just two days ago. Only 38 percent said they planned to vote in favor of the constitution.

President Vaclav Klaus of the Czech Republic, whose country has yet to decide whether to support the charter, declared it "a thing of the past." He added, "The French referendum, and its result, clearly demonstrated the deep division that exists between the European elite and the citizens of Europe."

That view was underscored by the voting trends in the vote in France.

According to the Ipsos polling agency, 70 percent of farmers voted no, despite the fact that France is the largest recipient of European Union farm subsidies.

Public and blue-collar workers and the unemployed, all low-pay groups vulnerable in a country with more than 10 percent unemployment, voted no by 60 percent to 79 percent.

Although most of the Socialist Party hierarchy lobbied in favor of the treaty, 56 percent of Socialist voters rejected it. On the political extremes, 98 percent of the Communist Party and 93 percent of the extreme right National Front voted no.

Paris and Lyon, two of France's biggest cities, and pro-European regions like Alsace, Brittany and the Loire Valley voted yes, while rural France and smaller cities and towns voted no. Most surprisingly, 55 percent of people ages 18 to 25 rejected the treaty, underscoring what appeared to be a lack of trust in the future of Europe and the leadership of France.

Humiliated and badly weakened in the eyes of both his own citizens and the world, Mr. Chirac is now at one of the lowest points of his 10-year presidency. The French media openly mocked him today.

"Did he manage to sleep so well on Sunday night?" the weekly L'Express asked in its latest edition on Monday. "He must realize to what extent the failure of the referendum is a personal disaster."

Serge July, the editor of the left-leaning daily Libération, referred today to "the disastrous end" of Mr. Chirac's "reign," while the daily Le Monde said the president "begins the end of his mandate discredited."

In Poland, the daily Zycie Warszawy joked Monday about the "Polish plumber who petrified France," a reference to the mythical worker from new European Union members like Poland who is free to move west and willing to work for lower pay than Frenchmen.

On Monday, Mr. Chirac held closed-door meetings, not only with Mr. Raffarin but also with a number of officials who might possibly replace him, including Nicolas Sarkozy, the leader of their ruling Union for a Popular Movement but a political enemy of Mr. Chirac; Interior Minister Dominique de Villepin, considered like a political son to Mr. Chirac; Defense Minister Michèle Alliot-Marie; and François Bayrou, the leader of the Christian-right Union for French Democracy.

Mr. Raffarin is being blamed in some quarters for the rejection of the constitution because of opinion surveys indicating that voters used the ballot partly to punish the French government's failure to tackle high unemployment and painful cost-cutting changes.

Mr. de Villepin is considered the front-runner for the prime minister's job, but he is not liked by much of the French political establishment, including deputies in Parliament who consider him distant from the people and complain that he does not bother to consult them.

A CSA opinion poll for France 3 television showed that Mr. Sarkozy, the most popular politician on the right, was the public's choice with 25 percent of voters wanting him to become prime minister. Only 11 percent favored Mr. de Villepin.
http://www.nytimes.com/2005/05/31/in.../31france.html


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Broadcast Flag at Half Mast?
Michael Grebb

A key lawmaker has complicated the movie industry's push for a law to restrict consumers' ability to redistribute digital TV content over peer-to-peer networks and the internet at large.

Rep. Joe Barton (R-Texas), chairman of the House Commerce Committee, has indicated that he opposes inserting a broadcast flag measure in his newly introduced digital TV bill, which would set a 2008 hard deadline for broadcasters to give back their analog spectrum.

Motion Picture Association of America Executive Vice President John Feehery on Wednesday confirmed that Barton told the MPAA he doesn't support broadcast-flag provisions in his bill, but Feehery said the group hasn't determined its next course of action.

"If that's what he thinks, that's what he thinks," said Feehery. "But we're continuing to educate members on the broadcast flag, and we're not sure where it will go."

The MPAA began its legislative push on Capitol Hill shortly after a May 6 ruling by the U.S. Court of Appeals for the District of Columbia.

In that decision, the court reversed a Federal Communications Commission order that required makers of consumer-electronics devices capable of receiving broadcast digital TV signals to recognize a "broadcast flag" -- code that allows content owners to place limits on redistribution of digital content streams. The rule was to apply to devices manufactured on or after July 1, 2005.

The MPAA had been circulating draft language to lawmakers that would have authorized the FCC to ban "the indiscriminate redistribution of digital television content over digital networks." The most expedient home for the language would be within Barton's bill.

House Commerce Committee spokesman Terry Lane noted that, "We have a draft DTV bill, and there's nothing about the broadcast flag in there," but he and Barton's personal spokesman declined to comment specifically on whether Barton opposes the broadcast-flag concept.

The MPAA could always push for stand-alone broadcast-flag legislation or even attach their draft language to another bill out of Barton's hands.

"Obviously, the MPAA isn't going to just go home," said Mike Godwin, legal director of Public Knowledge, which opposes the broadcast-flag concept. "They'll look for other avenues. But Barton really wants an uncomplicated bill. He wants to keep it simple."

Any controversy in Barton's bill related to the broadcast flag could indeed create fights that complicate its passage.

"Setting a hard deadline is a critical priority," said Michael Petricone, vice president of technology policy at the Consumer Electronics Association. "We would oppose anything that would make that more difficult."

Lawmakers are also concerned about the conclusions of an April 2005 report (.pdf) by the Congressional Research Service that seemed to bolster the arguments of broadcast-flag opponents.

"Current technological limitations have the potential to hinder some activities which might normally be considered 'fair use' under existing copyright law," the report stated. "For example, a consumer who wished to record a program to watch at a later time, or at a different location (time-shifting and space-shifting, respectively), might be prevented when otherwise approved technologies do not allow for such activities, or do not integrate well with one another, or with older, 'legacy' devices."

The report said such limitations could preclude "future fair or reasonable uses.... For example, a student would be unable to e-mail herself a copy of a project with digital video content because no current secure system exists for e-mail transmission."

The report, Barton's opposition and other factors may be presenting the MPAA with fewer options by the day.

"There is a lack of enthusiasm on the Hill for something like this," said Fred Von Lohmann, senior staff attorney at the Electronic Frontier Foundation. "That's why the MPAA tried to push this through the FCC in the first place."

Lohmann, however, said no one should count the MPAA out yet.

"It's not the final chapter," he said. "The Hollywood folks will continue to fight for the flag."
http://www.wired.com/news/technology...,67712,00.html


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With Popcorn, DVD's and TiVo, Moviegoers Are Staying Home
Laura M. Holson

Matthew Khalil goes to the movies about once a month, down from five or six times just a few years ago. Mr. Khalil, a senior at the University of California, Los Angeles, prefers instead to watch old movies and canceled television shows on DVD.

He also spends about 10 hours a week with friends playing the video game Halo 2. And he has to study, which means hours on the Internet and reading at least a book a week.

"If I want to watch a movie I can just rent it on DVD," he said. "I want to do things that conform to my time frame, not someone else's."

Like Mr. Khalil, many Americans are changing how they watch movies - especially young people, the most avid moviegoers. For 13 weekends in a row, box-office receipts have been down compared with a year ago, despite the blockbuster opening of the final "Star Wars" movie. And movie executives are unsure whether the trend will end over the important Memorial Day weekend that officially begins the summer season.

Meanwhile, sales of DVD's and other types of new media continue to surge.

With box-office attendance sliding, so far, for the third consecutive year, many in the industry are starting to ask whether the slump is just part of a cyclical swing driven mostly by a crop of weak movies or whether it reflects a much bigger change in the way Americans look to be entertained - a change that will pose serious new challenges to Hollywood.

Studios have made more on DVD sales and licensing products than on theatrical releases for some time. Now, technologies like TiVo and video-on-demand are keeping even more people at home, as are advanced home entertainment centers, with their high-definition television images on large flat screens and multichannel sound systems.

"It is much more chilling if there is a cultural shift in people staying away from movies," said Paul Dergarabedian, president of the Exhibitor Relations Company, a box- office tracking firm. "Quality is a fixable problem."

But even if the quality of movies can be improved, Mr. Dergarabedian said, the fundamental problem is that "today's audience is a much tougher crowd to excite. They have so many entertainment options and they have gotten used to getting everything on demand."

Last year Americans spent an average of 78 hours watching videos and DVD's, a 53 percent increase since 2000, according to a study by the Motion Picture Association of America, the film industry's trade group. DVD sales and rentals soared 676.5 percent during the same period, and 60 percent of all homes with a television set now also have a DVD player. DVD sales and rentals alone were about $21 billion, according to the Digital Entertainment Group.

Discs are now released just four months after a film's debut, and the barrage of advertising that accompanies the opening in movie theaters serves ultimately as a marketing campaign for the DVD, where the studios tend to make most of their profits.

By contrast, movie attendance has increased 8.1 percent from 2000 to 2004, according to the association. Many in the movie industry point to that figure as a sign of overall health. But attendance was down in three of those five years, and the sharp increase in attendance in 2002 is attributed to the overwhelming success of "Spider- Man" and "Star Wars: Attack of the Clones."

More recently, the number of moviegoers has dropped, sliding 4 percent in 2003, 2 percent in 2004 and 8 percent so far in 2005.

Time spent on the Internet has soared 76.6 percent and video game playing has increased 20.3 percent, according to the association. Last year, consumers bought $6.2 billion worth of video game software, an increase of 8 percent from 2003, according to the NPD Group, which tracks video game sales.

This does not mean that the $9.5 billion theatrical movie business is anywhere near its last gasp. It still plays a crucial role for the studios in generating excitement. But movie makers recognize they have to be more on their toes if they want to recapture their core audience.

"There are a lot of distractions," said Jerry Bruckheimer, who produced the "Pirates of the Caribbean" in 2003 as well as the successful "CSI" television franchise. "You need to pull them away from their computers. You need to pull them away from their video games."

Consider Matt Cohler, a 28-year-old vice president at Thefacebook.com, a Silicon Valley company that creates Internet student directories on college campuses. Mr. Cohler likes movies, but lately, he said, little has grabbed his attention.

He liked the new "Star Wars" and a documentary about the collapse of Enron. But of the Nicole Kidman-Sean Penn big-budget thriller, "The Interpreter," Mr. Cohler said, "It was only O.K." He has few plans to see anything else this summer, and said he was content to spend his free time online or writing e-mail.

"I feel quite strongly that, with a few exceptions, the quality of movies has been declining the last few years," he said.

Amy Pascal, the chairwoman of Sony Pictures Entertainment's motion picture group, said, "We can give ourselves every excuse for people not showing up - change in population, the demographic, sequels, this and that - but people just want good movies."

She predicted that "Bewitched," a romantic comedy about a producer who unwittingly hires a "real" witch for the lead role in a remake of the television show, would have a broad appeal. "If it was a straight-ahead remake of the show," she said, "we would have been guilty of doing the ordinary."

Jill Nightingale, 37, who works at IGN Entertainment in ad sales, is the type of moviegoer - older, female and important to studios - that "Bewitched" should appeal to. But video games increasingly have taken up time she otherwise might spend watching television or going to the movies. The last two theater showings she said she attended were "Star Wars" and "Sideways," which she viewed in December.

She plays a video game for 30 minutes each night before bed. Two weeks ago, five friends joined her at her San Francisco condo to drink wine and play "Karaoke Revolutions" on her Sony PlayStation, where the would-be American Idols had a competition, belting out everything from Top 40 hits to show tunes.

"Party games are great for dates," she said. "A few years ago I would have been at a bar or at a movie."

But what could well have the greatest impact on theater attendance is the growing interest in digital home entertainment centers, which deliver something much closer to a movie-style experience than conventional television sets.

Brian Goble, 37, a video game entrepreneur, said he had not been to a movie theater in two years, except to see "Star Wars" with his wife and four friends. Instead, he stays at his home in a Seattle suburb, where he has turned the basement into a home theater with a 53-inch high-definition television screen and large surround-sound speakers. He no longer has to deal with parking and jostling crowds, he said, a relief now that he has two children.

" It's really just not as comfortable and fun as being at home," he said. "You can pause, go to the bathroom, deal with a crying kid."

Mr. Goble rarely watches video-on-demand ("The quality is poor," he said.) Instead he has an account with Netflix and orders his movies online. When the Nicholas Cage movie "National Treasure" was released last November, for instance, he added it to his Netflix list so he would be sent a copy when it came out on DVD.

His prime regret about seeing the final installment of "Star Wars" was that he could not watch it at home. "The only reason to go to the theater these days," he said, "is because it is a movie you must see now."
http://www.nytimes.com/2005/05/27/bu...a/27movie.html


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TV's Future Is Here, but It Needs Work
David Pogue

YEARS ago, our futuristic fantasies involved robot butlers, video wristwatches and flying cars. These days, we would be happy to have a cellphone with no dead spots, e-mail without spam and the ability to watch any TV show, anytime we want it.

Actually, they are making progress on that last item. A company called Akimbo has a tantalizing idea. What if you had a TiVo-like set-top box, complete with a hard drive that could hold 200 hours of video - but instead of recording live broadcasts, you could tap into an enormous library of shows, stored on the Internet, and watch them whenever you liked?

It's a great concept. TV executives would benefit, because they would gain a meaningful afterlife for all the shows they have spent millions to produce - and then broadcast only once. You would benefit, too, because if you missed some episode of "Desperate Housewives" or "The Amazing Race," you could just hop over to your set-top box and download away. It would be like the video-swapping made possible today by software like BitTorrent, but the service would be legal.

Unfortunately, Akimbo can offer only what the networks and cable channels are willing to contribute. And these days, just hearing the phrase "Internet downloads" generally sends television executives into paranoid fits. As a result, the Akimbo library is so puny and overpriced that the enterprise is interesting only as a "what not to do" case study.

The Akimbo box ($200, but on sale at Akimbo.com for $100 until June 30) is a VCR-size unit with an 80-gigabyte hard drive. It requires a high-speed Internet connection, either wired (Ethernet) or wireless (with a specific Linksys U.S.B. adapter).

You connect the Akimbo box to your TV, using standard red-white-yellow RCA cables or, for slightly better color, an S-Video cable (not included). Activating your account involves a few minutes in front of the TV, another few at a Web site and a few more in front of the TV. The Akimbo downloading service, without which the box is useless, costs $10 a month or a one-time $170 fee.

Now for the moment of truth: using the remote control, you peruse the library of 2,000 programs available for downloading.

And then reality slaps you hard: Akimbo's library is laughable. As Akimbo's Web site puts it, the list includes AdvenTV, "the first on-demand Turkish station in the U.S."; Veg TV, "vegetarian cooking instruction"; and Skyworks, "helicopter flights over the most spectacular landscapes of Britain."

Here is the entire list of sports categories: Billiards, Extreme Sports, Golf, Martial Arts, Documentaries and Yachting.

You will not find "Desperate Housewives," "The Amazing Race" or any other network show. The catalog largely consists of shows from no-name networks, productions from overseas networks and even short video clips that can already be seen free on the Web.

Some cable networks have contributed material, including Turner Classic Movies, CNN, A&E, Cartoon Network, Food Network, the BBC and National Geographic. The selection is limited to a few series from each network, but at least they are not Turkish sitcoms.

But that is not even the worst of it. If you drill down far enough into the menus to arrive at the description page for a certain show, you often come upon the chilling words: "$2.99 (30-day viewing period)."

That's right: not only do you pay for the Akimbo box and its monthly $10 fee to get no-name shows, you also have to pay per show. And even then, the show you buy will erase itself after a month!

This is piracy paranoia run amok. It's insane to think that anyone would pay so much for cheesy cable reruns and oddities like three-minute how-to videos for new mothers.

To make matters worse, the rental terms are different for every show. Some are free. (Akimbo says 40 percent are free, but that tally includes movie trailers, video blogs, two-minute CNN snippets and other free stuff from the Web.) The rest cost 50 cents to $5; pornographic movies are $10 (parental controls are available). Some stay on your hard drive forever, some self-destruct after 7 or 30 days, and some give you only a two-day window to watch.

Some channels charge per month rather than per show. For example, you can pay $2 a month for a channel dedicated to Latin culture, $10 for an all-boxing channel or $13 a month for a children's science channel.

Some of this is not Akimbo's fault. It desperately needs material for its catalog, so it has to comply with what the networks demand. (This flailing, of course, is exactly what the music-downloading business did before Apple broke through the chaos, set the price standard at 99 cents a song and included a copy-protection system. Where's Steve Jobs when you need him?) But some of Akimbo's failings are all its own.

Downloading to the Akimbo box usually takes at least as long as the show itself, and you can't begin watching until the show is fully downloaded, so it's not exactly video- on-demand. (The speed of your Internet connection drops during downloading, so it's best to stick to tasks like reading and sending e-mail.)

The box stores video in Windows Media Player format, which freezes and drifts out of audio sync from time to time. The box takes about 8 to 12 seconds to begin playing any show. Nothing happens until several seconds after you press Rewind or Fast Forward, and there's only one speed: Excruciatingly Slow.

Fast-forwarding 30 minutes into a show takes two and a half minutes. But that's warp speed compared with rewinding, which is not even half that fast - and sometimes crashes the machine, shutting it down. You pine for the days when you could rewind tape by hand.

There are also some subtle bait-and-switch tactics. For example, you have to drill down four screens deep before discovering that a show requires a fee or a monthly membership, or is only two minutes long.

And despite Akimbo's claim to be "the first digital quality video-on-demand service over the Internet," the video quality is erratic. None of it is high-definition, none of it looks as good as a DVD, and some of it has the blockiness and pixellation of a Web cam. One children's series is so obviously a transfer from a VHS cassette, you can actually see the white streaks of the VCR's dirty heads.

Then there are the poor design decisions, like a remote with no illumination and listing screens so small that they cannot show the full names of shows and their descriptions.

In short, Akimbo is a train wreck. But there are a few points of light.

The box is very quiet. You cannot transfer any of your shows to a computer but you can copy them to a VCR or a DVD recorder's analog inputs. And there are some offbeat gems of programs among the chaff.

The other good news is that Akimbo is well aware of its problems. "We don't tell everyone to buy it," said Steve Shannon, the company's founder. "We say, try it out; we offer a 30-day money-back guarantee. It's meant to appeal to people who have an interest in a particular channel. If you're really into billiards, you might want this thing."

Later this year, the company intends to replace the box's current operating system with one that will offer faster (and multiple-speed) rewinding and fast-forwarding. Akimbo also says that it is talking to several movie studios about offering reasonably current movies. (They'll be available 30 days after their release to video stores.)

The company also hopes to add year-old network shows eventually, but don't expect current mainstream fare. "The big networks don't want to experiment," Mr. Shannon said.

If Akimbo can fix the problems and, more important, bring its partners to their senses on pricing and time limits, maybe there's hope.

But in its current incarnation, Akimbo will not win any awards for value or selection. On the other hand, it might just walk away with High-Tech Turkey of the Year.
http://www.nytimes.com/2005/06/02/te...s/02pogue.html


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The New Video Libraries

Once TV shows would disappear into thin air. No longer. New search engines are pushing us toward a world where all programs are stored on the Net, all the time.
Joy Wang and Michael Hastings

Suranga Chandratillake spent the last two years developing software to make sure fans won't ever miss another episode of "The Apprentice." Or any other television show, for that matter. As the founder of Blinkx, a search engine for audio and video files, he designed a computer system for the television networks to permanently archive their broadcasts online. He's taking his clients' shows—including Fox News, MTV and other TV networks—and making them accessible by a simple word search. It'll be a handy tool for viewers who want to find their favorite programs in a hurry. For the networks, it's the first step toward managing how their programs wind up on the Internet. "In the case of FoxNews.com," says Chandratillake, "our computers sat there and listened, as though with little headphones, to two and a half years of clips and made it all searchable."

The success of Blinkx—in the last five months, the number of users has doubled to 1 million—is the latest sign that television programs are headed toward becoming just another Internet application, like music files or pornography. Advances in file- compression technologies, which make video files small enough to be transferred quickly and easily on the Web, have made TV programs increasingly vulnerable to piracy. Audiences now regularly turn to so-called file-sharing software to get shows for free, as they initially turned to Napster for free songs. The most popular TV shows have been downloaded tens of thousands of times—each episode of the Fox show "24", for instance, was downloaded about 95,000 times after it was first aired, according to Envisional, a U.K.- based peer-to-peer (P2P) traffic monitor. The Pew Research Center, a Washington-based think tank, reports 17 percent of those online—about 23 million people—now download video files in the United States. A report earlier this year by the Informa Media Group says file-sharing costs TV and film companies $858 million annually. Television-industry executives fear that the trend will only get worse.

The strategy of the TV industry is not to fight the pirates so much as beat them at their own game—by making their television programming available, for a fee, on legitimate Internet-based video libraries. The key is to offer a service that's so much better than the rogue peer-to-peer networks that customers don't mind paying. "There's this general assumption that people will always steal content if they can, but I don't think that's true," says Chandratillake. "The success of the new Napster and iTunes demonstrates that people are very —interested in downloading broadband content online and paying for it, if it's priced right and available easily."

The need to provide searchable video libraries has created an alliance between the networks and search firms. In May, Yahoo signed a deal with 13 companies, including CBS and MTV. Google lined up PBS and C- SPAN in January. Blinkx has taken on 16 clients, recently adding A&E and The New York Times, which produces news video on its Web site, to its roster. The search firms have been scrambling to position themselves as marketplaces for movies and television programs. Google Video, a search service launched in January, wants eventually to offer videos and movies for sale, just as songs can be bought on iTunes. Yahoo launched a similar service, Yahoo! Video, last December. The search firms expect to attract advertisers to their sites, offering another attractive spot to market products. (The idea would be to run brief, 30-second clips before the TV show or movie starts.)

Despite the recent dealmaking, however, video search seems to have gotten off to a slow start. As the networks realize, video libraries will attract fee-paying customers only if they're easy to use and provide a wide variety of programming. Being able to make quick and accurate searches is vital. The technology, however, remains crude. Google Video, for instance, relies mainly on keyword searches of show transcripts, which tend to be riddled with errors, such as incorrectly spelled proper nouns, like names and places. Yahoo! Video has the networks provide the searchable information on the video files, either as transcripts or audio files. "It's very early going at this phase and we're not at the stage where videos are being bought and sold," says Bradley Horowitz, director of Media and Desktop Search at Yahoo! In the next few years, he says, the technology should develop to the point where users have extensive—and legitimate—access to videos online.

Experts say the fee-based search engines could be tempting to consumers, mainly because they have the potential to offer an unlimited video library. At present, the Yahoo and Google services fall far short of this goal—they provide mainly clips from TV broadcasts, not even complete shows. Both companies are wooing TV and movie studios to give them full access to content. A handful of smaller search-firm companies, such as Blinkx, Streamsage and Virage, have developed voice-recognition software that combs through video files, interprets the speech and comes up with key words and summaries that are searchable. Such a capability gives much more accurate search results than those that rely on error-laden transcripts. The challenge now for the search firms is convincing TV and movie executives that it's in their best interest to fork over all their videos.

The networks, of course, would clearly love to shut down the video peer- to-peer networks, as the audio industry did to Napster and Kazaa. But they can't. New file-sharing applications like BitTorrent and eDonkey are difficult to regulate. Video pirates have eschewed the use of centralized servers in their file-swapping networks, relying instead on decentralized networks that are virtually impossible to bust. Legal measures haven't worked so far. In May, a U.S. federal appeals court struck down anti- piracy regulations put in place by the Federal Communications Commission and supported by networks. TV executives from Europe, Asia and elsewhere are closely watching the the litigation surrounding Grokster, a file-sharing site. They believe the U.S. courts will set the tone for how emerging markets like China and India treat intellectual-property rights.

Thus far, a U.S. trade group—the Motion Picture Association of America— has spearheaded the charge, filing lawsuits in dozens of countries, including China, France and the Netherlands. "We want to make sure copyrights are protected and copyright owners are paid," says Jason Hirschorn, senior VP for MTV's media division. At the moment, the video pirates still have the advantage. But if Google and Yahoo and the other search firms succeed in doing for video what iTunes has done for music, Chandratillake should be able to watch "The Apprentice" any time he wants. For a fee.
http://msnbc.msn.com/id/8018603/site/newsweek/


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As TV Moves to the Web, Marketers Follow
Nat Ives

TELEVISION programmers are looking to make the Web a lot more like TV.

On Tuesday, the emerging-media group at Scripps Networks, part of the E. W. Scripps Company, plans to introduce an all-video Web site that will use programming from its Food Network, Fine Living, HGTV and DIY Network brands, as well as new clips.

A major advertiser in Scripps offline media, General Motors' GMC division, has paid for a video showroom on the site and a presence throughout it.

Others are likely to follow, as advertisers show a growing interest in the approach. "One of the biggest drivers for online advertising the first time was Web sites advertising on other Web sites," said Peter Petrusky, director for advisory services at PricewaterhouseCoopers. "This time it's being buoyed by the offline brand builders like Coke, Honda, Nike, Visa and Nestlé."

Alexia S. Quadrani, a senior managing director at Bear Stearns who follows the publishing and advertising industries, predicted more traditional publishers would follow the lead of Scripps. "You are seeing a lot more content go online because there is a demand for it," she said.

Web video - once too halting to bother with - is much easier to look at now, as high-speed Internet access spreads.

More than 34 million homes in the United States, representing 29.9 percent of households, had broadband connections last year, according to eMarketer, an online research provider. By 2008, eMarketer projects, broadband will be in 69.4 million homes, or 56.3 percent of households.

Web surfers have proved their willingness to watch live sports online for more than an hour at a time, said Bart Feder, president and chief executive at FeedRoom, a provider of broadband video technology to clients like NBC, Reuters and Telemundo.

The people who visit a Telemundo site to find video synopses of its Spanish-language telenovela soap operas watch for an average of 20 minutes at a time, he said. "That suggests that the quality is such that people are very happy to consume video content on their computers," Mr. Feder said.

GMC spent $241.5 million last year to advertise in major United States media, only $4.7 million of that on the Internet, according to estimates by TNS Media Intelligence.

The share of GMC's budget devoted to nontraditional advertising has been growing at a "very fast rate" over the last five years, said Steve Rosenblum, its marketing director.

"We first considered the Web as we would any media," Mr. Rosenblum said. "Let's take a static ad, put it on someone else's Web site, draw people to our Web site, increase traffic and eventually increase sales."

With broadband and the video clips, the company's products can be seen in vignettes on the new Scripps site. "The more seamlessly you're integrated into a site, the greater the relevance is to the consumer," Mr. Rosenblum said.

The home page at www.living.com, which is labeled "driven by GMC," shows six categories for visitors to choose from, like "Remodeling" and "Food." Clicking on a category leads to pages where visitors can again select from several videos - like "New Ceiling Fan."

Most of the videos in the Web showroom feature specific GMC products. Scripps plans to update the library of video clips, which last two to four minutes, every two weeks.

Other advertisers may sign up, but the site will remain relatively uncluttered, said Susan Canavari, senior vice president for marketing at Digitas, which handles interactive, promotion and relationship marketing duties for GMC. "The intent is not for this to become a site that's full of product placement and advertising," she said.
http://www.nytimes.com/2005/05/27/bu...ia/27adco.html


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Tivo Quarterly Net Loss Narrows, Stock Rises
Franklin Paul

TiVo Inc., a developer of television recording technology, on Thursday posted a significantly narrower quarterly loss on increased subscribers and lower costs, and the stock rose 19 percent.

TiVo, whose digital video recording (DVR) service lets users pause live TV and save massive amounts of programing, also said it expects to be profitable by the fourth quarter of its fiscal year, which ends in January 2006.

For the first quarter ended April 30, it posted a net loss of $857,000, or 1 cent a share, compared with a net loss of $9.1 million, or 11 cents a share in the year ago period.

Service and technology revenues for the quarter increased 59 percent to $40.0 million. Total revenue, including hardware sales, climbed to $46.9 million, from $34.5 million.

Analysts were expecting a loss of 9 cents a share, on revenue of $38.4 million, according to Reuters Estimates.

TiVo added a total of 319,000 subscribers in the quarter. So-called "TiVo-owned" customers, whom the company gains outside of its partnership with satellite TV provider DirecTV Group Inc, rose by 72,000. In all, TiVo ended the quarter at 3.3 million subscribers.

"It was a very good quarter, with a very bullish outlook about the future," said Hudson Square Research analyst Daniel Ernst, adding that TiVo executives appear very confident about its subscriber growth, distribution and profitability plans.

The rosy results come only months after some analysts said they doubted TiVo's future as a viable enterprise, due to growing competition from cable providers and its expensive drive to boost subscribers. Since then, the company has reeled in spending and signed a key distribution deal with Comcast Corp. (CMCSA.O: Quote, Profile, Research) , the No.1 cable TV provider.

The company said its spending on expenses such as rebates, which help lower the cost of units that customers buy at retail stores, fell to $3.6 million, from $5.0 million.

Subscribers Up, Spending Down

Wall Street analysts said they were impressed by the solid growth in subscribers, whose recurrent fees of up to $13 per month increase TiVo's revenue.

"They were in line with their subscriber guidance and spent a lot less than they expected, so they are getting some efficiencies on their marketing," said analyst Rob Sanderson of American Technology Research.

On a call with analysts, chief executive Michael Ramsay spoke optimistically about TiVo's burgeoning advertising software system, which the company believes may be attractive to other cable providers. However, he did not announce any new deals.

"We've got advertising capabilities for DVR that are unique," he said. "We have the potential ... to make this a standard across the entire industry."

Looking ahead, TiVo said it sees second-quarter growth of 40,000 to 60,000 "TiVo-owned" subscribers, and a total increase of 200,000 to 260,000 new users.

In addition, it narrowed its fiscal 2006 guidance to a loss of $10.0 million to $20.0 million, from its previous range of $10 million to $25 million, and reiterated its range for service and technology revenues to $155.0 million to $165.0 million.

Michael Ramsay, who said earlier this year that he would step down as CEO once a new one is found, said TiVo is still searching. In the meantime, Ramsay told analysts on a conference call he feels "fully in charge."

TiVo shares climbed to $8.00 on the Inet electronic brokerage, from its Nasdaq close of $6.94.
http://www.reuters.com/newsArticle.j...toryID=8627195


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Something in the Air

Here's what we're learning with our cell phones, sensors and Wi-Fi: losing the wires is only the beginning. What happens next is unpredictable, empowering and sometimes a bit unnerving
Steven Levy

In the '90s, people went bananas over wireless. Electronic communications once thought to be permanently bound to the world of cables and hard-wired connections suddenly were sprung free, and the possibilities seemed endless. Entrenched monopolies would fall, and a new uncabled era would usher in a level of intimate contact that would not only transform business but change human behavior. Such was the view by the end of that groundbreaking decade—the 1890s.

To be sure, the sepia-toned hype of those days wasn't all hot air. Guglielmo Marconi's "magic box" and its contemporary inventions kicked off an era of profound changes, not the least of which was the advent of broadcasting. So it does seem strange that a century later the buzz once more is about wireless. And once again the commotion is justified. Because changes are afoot that are arguably as earth shattering as the first wireless transformation.

Certainly a huge part of this revolution comes from untethering the most powerful communication tools of our time. Between our mobile phones, our BlackBerrys and Treos and our Wi-Fi'd computers, we're always on and always connected—and soon our cars and appliances will be too. While there's been considerable planning as to how people will use these tools and how they'll pay for them, the wonderful reality is that, as with the Internet, much of the action in the wireless world will ultimately emerge from the imaginative twists and turns that are possible when digital technology trumps the analog mind-set of telecom companies and government regulators.

Wi-Fi is a shining example of how wireless innovation can itself shed the constricting cables of conventional wisdom. At one point it was assumed that when people wanted to use wireless devices for things other than conversation, they'd have to rely on the painstakingly drawn, investment-heavy standards adopted by the giant corporations that rake in the dough through your monthly phone bill. But then some geeks came up with a new communications standard exploiting an unlicensed part of the spectrum (which the wonks at the FCC called "junk band," stuff designated for techno- flotsam like microwave ovens and cordless phones). It was called 802.11 and only later sexed up with the Wi-Fi moniker.

Though the range of signal was usually no more than a few hundred feet or less, Wi-Fi turned out to be a great way to wirelessly extend an Internet connection in the home or office. A new class of activist was born: the bandwidth liberator, with a goal of extending free wireless Internet to anyone venturing within the range of a gratis hotspot. Meanwhile, Apple Computer seized on the idea as a consumer solution, others followed and now Wi-Fi is as common as the modem once was.

Another unplanned bonus: more powerful variants of Wi-Fi, with exotic descriptors like WiMax or mesh networks, have now emerged as top contenders to finally hook up the recalcitrant or remote areas that have so far resisted broadband. As Kevin Werbach, former FCC counsel for new technology policy, notes, because "it's low cost and doesn't require a big upfront infrastructure investment," wireless technology is the means by which previously unwired chunks of civilization will get plugged in to the cyberaction. Consider the MIT Media Lab project to install Wi-Fi base stations on intervillage buses in India: when the vehicles stop to pick up passengers, computer users within range can use the signal to download files or send e-mail.

Wi-Fi is only one of dozens of variants of wireless in this spiraling movement. You might know GPS and satellite radio, Bluetooth and RFID, but do you know ZigBee? Got you there. (It's a way to network lots of appliances.) The important thing to remember is that as these methods pile up, the result is less and less about losing the wire and more and more about making way for activities that were previously unimaginable.

When you install cameras in telephones, for instance, photography shifts from a producer of flat illustrative artifact into a means of communication. The ease of distribution becomes a force in itself, pushing networks to handle more bandwidth. And the sudden addition of hundreds of millions of instant eyes to the global network provides its own challenges (thus the devices are banned in locker rooms and at the U.S. Supreme Court).

All over the planet, wireless is making waves, from the text-message-mad teenagers outside Tokyo's Shibuya station to a Wi-Fi-equipped McDonald's in New York City to Everest climbers calling home from the summit. With dizzying rapidity, wireless innovations move from the cutting edge to the routine. Just like what happened with Marconi's magic box during the first wireless revolution.
http://www.msnbc.msn.com/id/5092820/site/newsweek/


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Young Mobile Users Most Interested In Music-Survey

Commercial-free radio over mobile phones and the ability to download music to phones are the two most interesting advanced mobile services to young adults, according to a recent study. The survey, conducted by the Management Network Group consulting firm, also showed greater interest in a free ad-supported mobile video service than a subscription video service, such as those offered by Verizon Wireless and Sprint.

Many wireless service providers hope to boost their revenue with services like streaming music or video clip and music downloads to mobile phones, but there are still questions about demand for the new services. About 40 percent of 1,000 phone users between 13 and 34 years old would be very interested in commercial-free radio over their mobile phone, the survey said. Nearly 35 percent of those surveyed showed an interest in wireless music downloads.

It also said 40 percent of users showed strong interest in ad-supported video services, while less than 20 percent of respondents would be very or extremely likely to pay either a monthly mobile video subscription of $4 a month or a fee of 30 cents per video clip, it said. Verizon, the No. 2 U.S. mobile provider, and its next biggest rival, Sprint, both charge roughly $15 a month for their video packages. U.S. operators are widely expected to provide full download services to phones in the coming year but pricing such services for broad demand could also be tricky.

Paul Petersky, TMNG's vice president of market research, said that survey respondents preferred the idea of paying 99 cents per song for music downloads rather than $19.95 monthly for up to 30 song downloads. Petersky said that while only 21 percent of respondents said they were very interested in playing multiplayer video games on their phones he noted that teenage respondents were most interested in these services.
http://today.reuters.com/sponsoredby...-SURVEY-DC.XML


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'Kodak, Don't Take My Kodachrome'
Spencer Morgan

Paul Simon sang about it. Film students shot on it. Now, advocates are signing up to save Kodachrome, or at least its Super 8 motion-picture version, a 1965 technology that the Eastman Kodak Company would very much like to do without.

Earlier this month, Kodak, based in Rochester, N.Y., delivered a shock to experimental, underground and just plain old-fashioned filmmakers when - one day after a May 8 celebration called Global Super 8 Day - it announced plans to discontinue its low-speed, fine-grained Kodachrome Super 8 film in favor of a new Ektachrome Super 8 product.

For those caught up on the digital revolution, the announcement was easily missed. But to film geeks around the world, Kodak might as well have declared the death of color.

"Kodachrome is larger than life," said Andrew Lampert, a filmmaker and film archivist at the Anthology Film Archives in Manhattan. "Its colors are brighter than your imagination's. And what's amazing is, the film simply does not fade. It's irreplaceable."

Message boards hummed. An online petition materialized. Then, at the Cannes Film Festival, a Kodak executive, Robert Mayson, agreed to a meeting with Pip Chodorov, a principal member of Paris's thriving Super 8 filmmaking scene - the city is home to several Super 8 film festivals - and the administrator of frameworks.com, one of a number of online message boards dedicated to experimental film.

Mr. Chodorov, who also owns a video distribution company specializing in experimental and independent film, said the company blinked, at least a little. By his account, Mr. Mayson agreed that Kodak might produce more Super 8 Kodachrome, if the format's enthusiasts can find a way to process it. At present, the film is largely processed on a money-losing basis at the Kodak laboratory in Switzerland - where Super 8 Kodachrome processing is scheduled to cease in December 2007. Mr. Chodorov, in an telephone interview from Paris on Friday, said he now plans to petition the French government for a grant to help with processing.

He said he thought Mr. Mayson was "getting a lot of hate mail right now," adding, "I see it as my job to help find a solution, not send hate mail." Kodachrome Super 8 became a favorite thanks to the film's complex emulsion, the gelatinous solution that helps capture an image. It requires an elaborate developing process but produces striking, unique colors and unparalleled archival virtues, making it a favorite with Super 8 artists.

Kodachrome was the film of choice for avant-garde filmmakers like Kenneth Anger and Jonas Mekas, who were renowned in the film world though largely unknown outside it. A much larger population has most likely seen the film's fine-grain quality and lurid pigments in the form of old home movies. Indeed, the most famous image caught on Kodachrome film was the assassination of President John F. Kennedy, caught by Abraham Zapruder, a Dallas dressmaker who happened to be wielding an 8-millimeter camera that day.

In the last 20 years, video has all but eclipsed Super 8's practical use for amateur filmmakers and doting parents, who can now record images on a high-definition digital video camera, feed the footage directly onto a computer, edit it and e-mail it to a prospective producer or the grandparents in Michigan.

Super 8 cameras and projectors are now the stuff of specialty shops, eBay and flea markets, and Kodak alone continues to produce Super 8 film.

The company continues to produce Kodachrome in 16 millimeter and 35 millimeter formats, but it is discontinuing the Super 8 version largely because a steadily declining market has made processing unprofitable.

While the market may be small and shrinking, its constituents are passionate about their art. Small theaters in cities around the country, including Anthology Film Archives Millennium Film Workshop in New York, still regularly play Super 8 films. And when a theater isn't available, a white wall and a projector will suffice.

"I just showed one of my films at a small gallery out in Williamsburg," said Stephanie Gray, a 33-year-old filmmaker from Queens. "It was actually the backroom of someone's apartment." Ms. Gray, who bought her Super 8 camera for $25 at a flea market, said the medium lends itself to a poetic, personal kind of filmmaking that cannot be achieved with digital filmmaking. Judy Doherty, director of communications at Kodak's entertainment imaging division, argued that such poetry is well within reach of contemporary technology. If people are partial to shooting Super 8, she said, they can simply transfer the film onto digital and "achieve any kind of effect they want."

But enthusiasts contend that it simply isn't the same.

"When people started using synthesizers, we didn't throw out our pianos," Ms. Gray said.
http://www.nytimes.com/2005/05/31/arts/31koda.html


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How to

Turn Your Win XP Home Edition Into Pro With A Hidden Trick
Softpedia

Bill Gates is ready to compete with Harry Potter

Are you the owner of a Windows Home Edition which doesn’t suit your needs anymore and you would like to switch to the Pro version without investing any money? No problem.

According to the German C’T computer magazine, all you have to do is change 2 bytes from the file setupreg.hiv which can be found in Windows’s XP Home kit. In this way, you will have access to certain functions, such as ‘Remote Desktop’, ‘User management’ and benefit from enhanced security features.

However, if you do this, you won’t be able to install Service Pack 2 and considering the countless security problems it solves, maybe it would be best to just purchase the Pro Edition of the system.

Leaving the technicalities aside, let’s analyze for a moment Microsoft’s policy. For a certain amount of money, Bill Gates offers you a vulnerable operating system stripped of several features. Pay a few dollars more, and you get the same operating system, theoretically harder to hack (and I emphasize theoretically) which is added the missing features.

And all that Microsoft has to do is change the install kit. You have to admit it’s absolutely brilliant.
http://news.softpedia.com/news/Turn-...ick-2514.shtml


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Sony Performs Vasectomy On CDs
Softpedia

Sony BMG is testing a British technology allowing the users to make only a limited number of copies of a CD, and the respective copies cannot by any means be reproduced. The technology comes from the First4Internet company, specialized in producing anti-piracy solutions and is known as "sterile copying".

Sony declares that this solution represents a tough blow on worldwide piracy, seeing that the copying for personal use represents a major problem for the production companies. In fact, the ripping and ulterior rewriting of CDs represents two thirds of the worldwide piracy, and that is the reason why finding a solution to assure the security of CD formats is vital.

The new anti-copying technology has already been included in the CDs’ production process, until now about 1 million original disks produced by Sony BMG being protected by it, with the titles yet to be announced.

First4Internet is not the only company Sony will work with, the manufacturer intending to also get other partners involved in this effort of promoting sterile copying. SunnComm is the owner of MediaMax technology, a DRM solution that fulfills perfectly Sony BMG’s copyright protection requirements. However, in the past, Sony entrusted MediaMax with several titles, and in a short time the respective contents could already be found on p2p networks. Despite this, there is hope that a procedure by means of which Sony will be able to at least slow down the piracy rate will soon be available, either from MediaMax, or from First4Internet’s XCP.
http://news.softpedia.com/news/Sony-...CDs-2466.shtml


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The Other Side of BitTorrent
Patrick Gray

Film and television executives no doubt wish the increasingly popular BitTorrent peer-to-peer file-sharing system never saw the light of day. Thousands of consumers are using the software to download hundreds of movies and hours upon hours of television programming.

But one industry's threat is another's opportunity. There's an upside to allowing viewers to transfer copyright material content over BitTorrent.

As noted by Japanese entrepreneur Joi Ito, fans of the Japanese anime series Naruto regularly post translated episodes of the show to BitTorrent, which attracts more fans to the series.

The relatively obscure program has spawned a global following in online forums, internet relay chat channels and fan sites.

With box sets and special edition DVDs, Ito wrote, the copyright holders can make a tidy sum from fans prepared to "spend thousands of dollars on one show."

However, not everyone is convinced BitTorrent will level the playing field. Heavy.com, a New York-based independent online content provider and marketing outfit, said cheap and easy distribution is only a part of the equation.

Heavy already distributes some content over peer-to-peer networks to "get the word out," said co-CEO Simon Assaad. But he doesn't expect an immediate content shake-up to overthrow the majors.

"People assume that because it's open to everyone there'll be this mass movement of people making quality content that everyone can access, and I don't think that's true," he said.

Even if independents can produce quality content, the marketing clout required to generate an audience will make it harder for smaller players. "Marketing is getting harder as people's attention gets fragmented," Assaad said.

Still, Assaad said word of mouth and community building can work. "You could be a smart marketer and spend a thousand bucks if you spend it in the right places," he said.

So, as far as Assaad is concerned, don't expect the TV and cable stations to close their doors just yet. Controlling the means of mass distribution, it seems, isn't as important as controlling the means of mass marketing. Still, Assaad said, we're in for some changes.

"Technology is forcing people to continuously evolve," Assaad says. "It's being like a shark: If you stop, you die."

Peer-to-peer, however, won't be dying any time soon. Vint Cerf, one of the original developers of the Internet Protocol, says the technology is here to stay, despite the prolonged legal attacks from copyright holders.

"This is an environment where ideas that work typically propagate," Cerf said. "It doesn't matter if they started out in a way that were unsatisfactory to some folks."

That BitTorrent works so well is making Hollywood and the television networks mighty uncomfortable. Peer-to- peer is all grown up, and the war against movie and television piracy is ramping up.

Until recently, BitTorrent piracy was a free-for-all. Suprnova.org, a website started by Adrej Preston, then a 16- year-old Steiner school student in Slovenia, offered millions of torrent files for download, free of charge.

"With BitTorrent you can distribute one file to one thousand people in almost the same amount of time as you would to one person on (the) Kazaa network," said Preston, now 19.

It didn't take long for copyright owners to catch on, and they've been busy suing everyone. SuprNova.org is gone, along with many other torrent trackers offering links to copyright files. That hasn't stopped Preston.

He and his cohorts have released eXeem, a trackerless, Kazaa-like application that lets users search for downloads from a decentralized database.

"EXeem is made so that we do not host any info (about) what is on the network," Preston said. "Even the nodes are made so that they change all the time."

Preston is likely expecting legal hassles. He won't admit to having a stake in Swarm Systems, the company that controls eXeem, describing himself only as "a representative."

Swarm is incorporated in the Caribbean money-laundering haven of Saint Kitts and Nevis. Either way, eXeem seems well placed to cause a few more headaches for Hollywood.
http://www.wired.com/news/digiwood/0,1412,67641,00.html


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Gpic Worm Hits AIM
Jim Wagner

UPDATED: In an advisory posted by enterprise IM vendor IMlogic Wednesday, officials warned of a new worm (define) spread by old means: getting users to click on a URL (define) that purports to come from a friend on their buddy list.

The latest threat to AOL's instant messaging (IM) platform, AIM, again targets users' penchants to blindly click on links supplied by friends. The Gpic.aol worm comes with a message saying, "damn this looks just like me lol" and a link to what is displayed as pictures.google.com.

In reality, the displayed URL obscures the real Web site at newpeople.no- ip.info, which then downloads onto the user's system, collects the names in the buddy list and sends the same message to all of them.

Gpic.aol is considered a medium-level risk threat; it doesn't actually deliver a payload that allows the malware (define) writer to gain remote access to the computer or corrupt or erase data on the hard drive.

For the time being, IM worms are merely a nuisance, propagating from one AIM buddy list to another. But Francis deSouza, IMlogic CEO, said he fears it's only a matter of time before virus writers start delivering damaging code as well.

IM, replete with functionality, such as file transferring, video and audio, is at risk from malware writers gaining access to those features, he said.

"Your e-mail client can only do so many things," he said. "Your IM client is actually much more functional and much more powerful, and because much of the functionality is real-time functionality, threats can propagate over IM much faster than over e-mails."

According to an April report by the company, the first three months of 2005 found a 271 percent increase in the amount of reported IM and peer-to-peer threats from the previous year. Of the reported incidents, the report found 82 percent dealt with IM virus or worm propagation.

DeSouza said AIM, up until a couple of weeks ago, has been relatively spared from the worms encountered in the IM world compared to those of Yahoo Messenger and Microsoft's MSN.

In the past two weeks, AIM has become a fertile ground for worm writers and has contributed to seven new AIM-targeted worms, according to the company's list of IM and P2P threats.

In all cases, the worms display a skillful degree of social engineering, getting people to click on links they would never do visiting a strange Web site or in an e-mail.

A recent AIM worm capitalized on the popularity of Star Wars III and reports of a leaked copy of the movie on P2P and BitTorrent sites, telling victims to click on the link to download the movie.

In related news, e-mail security firm MessageLabs has tracked more than 850,000 copies of a new Bagle downloader that started making its way through e-mail inboxes Tuesday afternoon, according to officials.

Like the majority of viruses, the user needs to be tricked into installing the file onto the computer. When that's accomplished, the virus harvests e-mail addresses on the hard drive and forwards a copy of itself to the the e-mail addresses.

According to a report by Postini Wednesday, the Bagle virus was the ninth-largest for the month of May, but figures show Bagle is coming back strong.

Postini's real-time virus-tracking site Wednesday reports the Bagle virus was the No. 1 virus threat, with nearly 1.5 million reported instances.
http://www.internetnews.com/security...le.php/3509321


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Paper

DDLS: Extending Open Hypermedia Systems into Peer-to-Peer Environments

Zhou, J. (2004) DDLS: Extending Open Hypermedia Systems into Peer-to-Peer Environments. PhD, Electronics and Computer Science, University of Southampton.

PDF
1551Kb

Abstract

Peer-to-peer (P2P) computing is primarily characterised by decentralisation, scalability, anonymity, self-organisation and ad hoc connectivity. It attracted considerable attention in open hypermedia research due to its potential for supporting collaboration among a community of people sharing similar knowledge background. The aim of this research is to investigate the feasibility and potential benefits of corporating the P2P paradigm in open hypermedia systems to support resource sharing-based collaboration. This is accomplished by utilising a distributed dynamic link service (DDLS) as a testbed, addressing issues that arise from implementing the paradigm, and demonstrating the efficiency of proposed techniques through simulation.

This research begins with the development of a prototype DDLS using the open hypermedia paradigm for storing and presenting resources and a centralised P2P model which adopts a central service directory for publishing and discovering resources in a well-arranged environment. This is enhanced by an operational analysis and feature comparison between prototypes based on the traditional client-server and the centralised P2P models. Various P2P models are analysed to identify the key characteristics of and requirements for the DDLS using an unstructured P2P model which empowers collaboration in an ad hoc environment.

The second phase of this research concentrates on overcoming the challenges of resource description, publishing and discovery posed by the unstructured P2P DDLS: using RDF to encode information about resources, developing a clustering technique to group resources and form the information space; and creating a semantic search mechanism to discover resources; respectively. Finally, this research proposes re-organisation techniques based on the exponential decay function and the naive estimator to enhance the performance of resource discovery in resource sharing-based collaboration.
http://eprints.ecs.soton.ac.uk/10917/

[JackSpratts]

No Privacy in Your Cubicle? Try an Electronic Silencer
John Markoff

Maxwell Smart's "cone of silence" is finally a reality.

Two people in an office here were having a tête-à-tête, but it was impossible for a listener standing nearby to understand what they were saying. The conversation sounded like a waterfall of voices, both tantalizingly familiar and yet incomprehensible.

The cone of silence, called Babble, is actually a device composed of a sound processor and several speakers that multiply and scramble voices that come within its range. About the size of a clock radio, the first model is designed for a person using a phone, but other models will work in open office space.

The voice scrambling technology used in Babble was developed by Applied Minds, a research and consulting firm founded by Danny Hillis, a distinguished computer architect, and Bran Ferren, an industrial designer and Hollywood special effects wizard.

Babble, which is intended to function as a substitute for walls and acoustic tiling, is an example of a new class of product that uses computing technology to shape sound. Already on the market are headphones that can cancel extraneous noises and stereo systems that can direct sound to a particular location.

The system will be introduced in June by Sonare Technologies, a new subsidiary of Herman Miller, the maker of the Aeron chair, as part of an effort to move beyond office furniture. The company plans to sell the device for less than $400 through consumer electronics and office supply stores.

Herman Miller originally turned to Applied Minds without a specific product in mind; instead, they were hoping the firm would help it create new concepts.

"We complement each other well because Danny is a real scientist when it comes to deep analytics and physics," Mr. Ferren said of his partnership with Mr. Hillis. "I have a good general working knowledge and can give him insight on the aesthetics and design side."

The two men formed Applied Minds after leaving Walt Disney Imagineering in 2000. Mr. Hillis was a pioneer in the design of extremely powerful computers known as massively parallel supercomputers, having founded Thinking Machines, a company based in Cambridge, Mass., that subsequently went out of business in 1982.

Mr. Ferren has been a leader in movie effects, working on such films as "Little Shop of Horrors" and "Star Trek V: The Final Frontier," and has won Academy Awards for technical achievement. He also developed mirrored sunglasses for Revo in the 1980's. Applied Minds, housed in a cluster of five converted warehouses here, is a technology playhouse for a group of 100 designers who work on projects ranging from designing buildings for government agencies to trying to treat cancer through the emerging field of proteomics, the study of proteins.

"I have known Danny for 25 years and Bran almost as long," said Nicholas Negroponte, the founding chairman of the Massachusetts Institute of Technology Media Laboratory. Their partnership, Mr. Negroponte said, "brings together two of the most interesting minds" in the country.

In addition to its work with Herman Miller, Applied Minds is developing some 40 new concepts and products for sponsors as diverse as General Motors, Cedars-Sinai Health System, Northrop Grumman, and the toymaker Funrise.

The Babble voice privacy system is the first commercial example of Applied Minds' approach in collaborative product design. The partnership with Herman Miller began three years ago after Mr. Hillis met Gary S. Miller, Herman Miller's chief development officer, at a technology and design conference in Monterey, Calif.

The Babble scrambling technology is not the first attempt at using technology to provide office privacy. Acoustic materials have been used for dampening sound and white noise generators are commercially available, but the Herman Miller executives said that their new system was more effective.

While many companies resist outside design collaboration, Herman Miller is unusual in that it has traditionally formed partnerships with independent industrial designers in the furniture business, Mr. Miller said.

"Our model has been to use outsiders," he said. "We needed to do that to enter new markets."

Herman Miller has a long history of exploring the leading edges of office furniture and computer technology. The company worked with the computer scientist Douglas C. Engelbart during the 1960's to design furniture and office systems that would help workers collaborate more effectively.

In fact, a walk through Applied Minds' warehouses reveals many projects that seem to adopt the Engelbart approach of looking for ways to harness machines to augment human intelligence. With Northrop Grumman, the design firm is experimenting with teleconferencing, looking for ways to build systems that are useful for colleagues who work far apart from one another.

Mr. Ferren is particularly interested in finding novel solutions to design problems. All the bookshelves in the company's offices, for example, are tilted 15 degrees to one side as a way to keep books neatly stacked.

In forming an alliance with Herman Miller, Mr. Hillis proposed a yearlong experiment period, which would allow the two companies to work together on broad ideas. After that, they could either commit to a product development project or go separate ways.

After the first year, it was clear that their collaboration would work. In addition to underwriting the cost of developing the Babble technology, Sonare, the Herman Miller subsidiary, will pay licensing fees to Applied Minds. The hope is that in addition to its office uses, Babble will also be helpful in public places where privacy is important, like hospital admitting stations or restaurants.

Herman Miller and Applied Minds are now moving toward the completion of a product line for a separate Herman Miller subsidiary, Viaro.

That line, which will be introduced later this year, is a flexible system for reorganizing walls, lighting systems, and power and computer networks in retail stores and offices. Based on parallel tracks mounted in the ceiling, the Viaro system will contain modular components that can be easily reconfigured and plugged into the tracks.

For Mr. Hillis, Applied Minds has allayed a frustration he felt while running Thinking Machines in the 1980's.

"What I really loved was making the first one of something," he said. "That was a lesson out of Thinking Machines. Most of the business is about the rest of the process of bringing a product to market."

Mr. Hillis said that Applied Minds, which is partially underwritten by Kleiner, Perkins, Caufield & Byers, the Silicon Valley venture capital firm, and Millennium Technology Ventures of New York, is already profitable. He said it had no intention of becoming a public company. Instead, the company hopes that some of its designs will lead to spinoff companies that will be profitable for the investors.

One of the prototypes closest to becoming a candidate for a spinoff is a novel tabletop digital map, about the size of a large flat panel television. The system has a touch-sensitive screen, making it possible to handle high-resolution digital imagery as easily as sliding a paper map across a table.

The system is controlled by a series of hand gestures. For example, to zoom on a region, a user touches both hands to the screen and slides them apart.

Mr. Hillis recently demonstrated the system, which was developed for a government agency (under the contract, Mr. Hillis is not allowed to name it), to a large convention of cartographers in San Diego.

"People came up afterwards and said they were moved to tears by the demonstration," Mr. Hillis said.

When a recent visitor mentioned that the demonstration was like something from "Star Trek," Mr. Hillis was visibly enthusiastic.

"That's what I've always wanted to do," he said. "Be ahead of 'Star Trek.' "
http://www.nytimes.com/2005/05/30/te.../30hillis.html


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Higher Ed

Plan To Gather Student Data Draws Fire
Michael Janofsky

A growing number of groups concerned about privacy rights are fighting a Department of Education plan to require colleges to place personal information on individual students into a national database maintained by the government.

The plan could be part of the spending bill for the Higher Education Act that the Senate will vote on next month. If included in the spending measure, the plan would radically change current practice by requiring schools to provide personal information on all students, not just those receiving federal aid.

Submissions would include every student's name and Social Security number, along with gender; date of birth; home address; race; ethnicity; names of every college course begun and completed; attendance records; and financial aid information.

Such detailed information is now provided only for students receiving federal aid, giving the department only a partial picture of higher education nationwide. The new approach, department officials say, would not only complete the picture but also help track students who take uncommon paths toward a degree.

"Forty percent of students now enroll in more than one institution at some point during their progress to a degree," said Grover Whitehurst, director of the department's Institute of Education Sciences, which devised the plan. "The only way to accurately account for students who stop out, drop out, graduate at a later date or transfer out is with a system that tracks individual students across and within post-secondary institutions."

It is not clear whether the proposal has enough momentum--or even a sponsor--to be added by the Senate. The House version did not include the plan, and Rep. John Boehner, R-Ohio, chairman of the House Education and Workforce Committee, has spoken against it.

Concerned that the plan could emerge through the Senate, opponents are trying to kill it before it gains any traction.

"Our belief is that the department, itself, is both unconstitutional and a relic of the last century that should not exist, let alone create new databases," said Michael Ostrolenk, education policy director for two conservative groups, EdWatch and Eagle Forum. "I don't trust the government with databases with private information on citizens."

Jim Dempsey, executive director of the Center for Democracy and Technology, said: "Once a database is created for one purpose, regardless how genuine or legitimate it is, it's very, very hard to prevent it from being used for law enforcement or intelligence purposes. If the FBI comes calling, it almost doesn't matter what the privacy policy is. They'll get the information they want."

Indeed, the feasibility report permits the attorney general and the Department of Justice to gain access to the database "in order to fight terrorism." Backers of the proposal, while acknowledging the privacy concerns, say that the benefits of having more information about students outweigh the risks, especially for lawmakers who oversee federal aid programs.
http://news.com.com/Plan+to+gather+s...3-5722757.html


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IU Internet2 User Accused Of Illegal File-Sharing
AP

Record companies have sued another Indiana University computer user for sharing music files, this time as part of a batch of lawsuits targeting users of the super-fast "Internet2" network.

The lawsuit, filed last week in U.S. District Court in Indianapolis, identifies the IU user only as John Doe.

It was part of a batch of lawsuits coordinated by the Recording Industry Association of America targeting 91 users at 20 colleges and universities that accuse Internet2 users of copyright infringement.

The Internet2 is used by several million university students, researchers and professionals around the world but is generally inaccessible to the public.
http://www.indystar.com/apps/pbcs.dl...506010368/1003


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RIAA Sues Another Princeton Student
Tom Senn

School's out, but the music industry isn't taking a break from litigation. The Recording Industry Association of America (RIAA) announced a new round of copyright infringement lawsuits last week against 91 students at 33 colleges, including Princeton.

This latest series of lawsuits includes one suit filed against a Princeton student, University spokesman Eric Quinones said in an email Wednesday. The student has already been notified by the University.

Although violators can be fined up to $150,000 per copyrighted work infringed, students typically settle out of court with the RIAA for around $3,000 to $5,000.

The RIAA filed suits in mid-April against 25 University students accused of illegally trading music files on the high-speed Internet2 network operated by 206 universities and affiliated institutions nationwide. This latest wave of litigation also targets students who allegedly swapped music on the research network.

"As long as students continue to corrupt this specialized academic network for the flagrant theft of music, we will continue to make it clear that there are consequences for these unlawful actions," RIAA president Cary Sherman said in a statement recently.

The file-sharing program i2hub runs on the Internet2 network and was previously thought by many students to be safe from the industry's legal grasp, but has recently been singled out by the RIAA as a zone for lawlessness.

"With the multitude of legal music alternatives available to students today, there is simply no excuse for this ongoing, illegal downloading on college campuses," Sherman said.

Students at Harvard, NYU, Brown, Columbia, and USC were among those targeted in the most recent round of litigation, announced May 26.

Since the RIAA files lawsuits using the IP addresses of "John Does" illegally sharing music on peer-to-peer networks, the Princeton student being sued has not been identified by name.

The RIAA must subpoena the University to officially obtain the identity behind the address. The University received a letter from the RIAA Wednesday indicating it would soon deliver a subpoena seeking the identification of the student in question, but no specific time frame was indicated, according to Quinones.

Quinones also said the University is committed to addressing the problem of illegal file-sharing and that students are taking notice.

"The University has made it clear to students that copyright infringement must be taken seriously, both through our published policies and through education outreach efforts," Quinones said.

"A debate on file-sharing issues held on campus [in May], which was organized by Princeton students, indicates that they are paying greater attention to these matters, but the University will continue to make students aware of the serious consequences of violating copyright laws," he added.

The University has no plans to change the disciplinary process for student violators, Quinones said. Students typically receive a dean's warning for the first violation of the University's file-sharing policies, and six months' disciplinary probation for a second violation or an egregious violation. A dean's warning is not recorded on a student's permanent record.
http://www.dailyprincetonian.com/arc...ws/13017.shtml


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RIAA Sues Two More Students
Vladimir Kogan

Recording companies charged two more unidentified UCSD students with illegally sharing copyrighted music through a specialized, high-speed university network known as Internet2 in a second wave of lawsuits filed in federal court late last week.

The new charges bring the total number of campus defendants accused of file sharing to 27, adding to the 25 initial suits that were first made public last month.

Recording Industry Association of America President Cary Sherman backed away from his suggestion in April that the industry would not target more than 25 students from any single college campus.

“As long as students continue to corrupt this specialized academic network for the flagrant theft of music, we will continue to make it clear that there are consequences for these unlawful actions,” he stated in a press release announcing the new filings. “With the multitude of legal music alternatives available to students today, there is simply no excuse for this ongoing illegal downloading on college campuses.”

Court records listing the IP addresses of the new defendants or the songs they are accused of sharing were not immediately available.

However, RIAA spokeswoman Jenni Engebretsen said the newest suits target users of the popular “i2hub” application.

Recording companies have already secured out-of-court settlements with approximately 70 of the 405 students charged last month.

While the students targeted in the initial suits shared an average of 2,300 songs each, the two newest defendants kept far fewer songs on their computer, though the number was still “egregiously” large, Engebretsen said.

However, UCSD has not yet received subpoenas seeking to identify the students charged in the first wave of suits, according to Academic Computing Services Director Tony Wood, meaning that their exact identities are likely still unknown to RIAA.

Because the suits were among hundreds of others filed in different federal court jurisdictions, Engebretsen said it was difficult to predict a timeline for proceedings in each case.

Wood did say that ResNet had turned over records in early May in response to subpoenas issued by the Motion Picture Association of America, which filed a separate federal claim against two UCSD students for illegally distributing movies.

MPAA’s action accuses two students, whose IP addresses have already been disconnected, of uploading the movies “Be Cool” and “Hotel Rwanda” in late March and early April, respectively.

Engebretsen said the RIAA suits have been effective at reducing peer-to-peer file-sharing, forcing students to think twice before engaging in the illegal activity.

“There is no doubt that our initial round of lawsuits has created a heightened awareness of this problem with both students and universities,” she said.

The university, however, has not made any changes to its Internet-use policies nor has it blocked access to peer-to-peer software, as the RIAA had urged, according to Wood.

“There have been no policy changes related to this subject and I don’t know of any in the works,” he stated in an e-mail.
http://www.ucsdguardian.org/cgi-bin/...=2005_06_02_04


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UCLA Students Among The 91 Sued In Music Industry’s Efforts Against Theft
Dagan Josephson

The Recording Industry Association of America issued a new round of copyright infringement lawsuits for illegal file sharing last week, which includes seven UCLA students out of a total of 91 students nationwide.

This second wave of lawsuits, issued May 26, was targeted against users of Internet2 – a specialized high-speed network used by university students – and marks the first time UCLA students have been the recipients of such legal action.

Students from 33 schools, including UC Berkeley, Davis and San Diego, have been sued this time around, according to the RIAA.

"As long as students continue to corrupt this specialized academic network for the flagrant theft of music, we will continue to make it clear that there are consequences for these unlawful actions," said Cary Sherman, president of the RIAA in a press release.

The RIAA also filed lawsuits last week against an additional 649 "John Doe" individuals who have distributed copyrighted music illegally using peer-to-peer services like Kazaa, LimeWire and Grokster.

To date, over 11,000 lawsuits for illegal file sharing have been filed by the RIAA since the recording industry's legal campaign began in September 2003.

UCLA issued a response last Thursday to the RIAA's legal actions acknowledging the notice of the lawsuits and asking students not to engage in illegal file sharing.

"UCLA considers illegal file sharing an important concern and strives continuously to resolve this very complex issue," according to a May 26 UCLA press release.

The school also wants to "work on the challenging and ever-evolving issue of illegal file sharing," the press release reported.

In April, the RIAA launched its first lawsuits against Internet2 users and university students from 18 different campuses, but no UCLA students were targeted then.

UCLA does not actively monitor the Internet activity of its students, said Associate Vice Chancellor for Information Technology Jim Davis.

The school only takes action if there are claims of illegal file sharing.

"We are obligated by law to respond to these subpoenas," Davis said, meaning the university must turn over any documentation that can show UCLA students have engaged in illegal file sharing. Otherwise, UCLA itself could become the object of a lawsuit.

But, "it's not our preference that we get subpoenas," Davis said.

According to the No Electronic Theft Act, which is concerned with copyright violations that involve digital recordings, criminal penalties can be as high as five years in prison for sharing copyrighted music, in addition to $250,000 in fines if a person is sharing more than $2,500 worth of music, regardless if the file sharing was done for profit or not. Furthermore, individuals may face civil charges and statutory damages which may run up to $150,000 per work infringed.

Also, the minimal penalty per song is $750 and civil penalties can run individuals into thousands of dollars in damages and legal fees.

Davis said UCLA plays an important role in "keeping the campus aware of this issue" and helps students "understand the ramifications of this."

To decrease illegal file sharing, UCLA instituted a "quarantine" system in April 2004.

First-time offenders have their computers' Internet access blocked, though students still have continued access to UCLA services, such as MyUCLA.

Violators are also sent an e-mail requesting them to remove all illegally obtained copyrighted material. The e-mail also explains the ramifications of a repeat offense.

Students must acknowledge electronically that they have engaged in illegal file sharing.

Repeat offenders will have their Internet access blocked, in addition to their names being sent to the dean of students.

The quarantine process has led to "a significant decrease in the number of repeat offenses," the May 26 press release said.

Davis believes the RIAA and the Motion Picture Association of America will continue to take legal action in the future.

"Both are very serious about the i2hub technology," he said, referring to the application used to access the Internet2 network.
http://www.dailybruin.ucla.edu/news/...s.asp?id=33588


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Will File-Sharing Mean Death Or Downsizing For The Recording Industry?
Cody Nabours

Guardian Super-Friends Team-Up presents: Ian Smith Port and Cody Benjamin Nabours weighing in on the future of a record industry gasping its last breaths under the collective strain of illegal file-sharing.

CN: Do you think there will be a successful effort to restore music buying to the way it used to be, back when we would pay exorbitant amounts for music, because we couldn’t get it any other way?

ISP: No, I don’t. I don’t think that will ever happen. The longer and longer things go on, there is this growing generation of music consumers who are unfamiliar with the way the system used to be, and will never ever go back to that, no matter what.

CN: We’ll always have to have peer-to-peer file-sharing; people need to share information. We live in an age where we connect ourselves to a larger web of individuals; we can’t deny them their private right to trade information. People will always steal. And they can’t be stopped.

ISP: Whether or not it’s stealing, the people that do it don’t consider it to be abnormal or deviant behavior. That’s how they understand they’re supposed to do it. It’s what they’ve done. More and more people are going to think like that. Certainly our generation, where we had a long period of paying for music — now if I want to hear a pop song, I don’t go buy a fucking record, I just download it. It’s not always successful, but most of the time I can get what I want.

CN: At some point in the future, it won’t even be “stealing” anymore.

ISP: They don’t think of it as stealing, and they’re the big consumers of music.

CN: If the recording industry thrives on people purchasing music, how will they survive? You can’t just have the musician pass music directly to the consumer.

ISP: I think there will still be a recording industry; I don’t think that downloading will actually kill the recording industry. But it will downsize it for sure. It won’t go away. There has to be some sort of institution there that fulfills this role of paying for studio time, distributing and advertising — being the medium between the artist and the commercial world.

CN: Large record companies could try to cash in by producing more artists that will appeal to the widest audience, but the more popular a single artist or a single song is, the easier it will be to find and download, since there will be more people to get it from. Eventually, the idea of the “superstar” will be eroded, because that one artist will be heavily downloaded, and less commercially viable for his or her record company. I read something a long time ago, at the start of the downloading fiasco, that proposed the recording industry could be “saved” by the following: looking for lots of good new artists and selling their albums for cheap. After say, three albums, instead of selling for $5 to $8, they sell for $10 to $12. If they develop a fan base, the fans will pay the slightly higher price for the album; if not, they will disappear, leaving more room on the shelves for a multitude of new artists. The recording industry must make sacrifices — instead of swimming in goddamn gold pools; why can’t they live a normal life like the rest of us?

ISP: Marketing and broadcasting is so cheap and easy now that you don’t have to have an artist that appeals to millions of people to justify spending enough money to get them nationally known. To do that, you have to get a good review on the right Web site, or a mention in the right magazine. Successful record companies do that. Indie labels like Dischord sell all their CDs for $10. They go out and find crazy shit, they take a risk and put out a record that a lot of people wouldn’t put out. Sometimes they sell a lot of it, and the artists, like Bright Eyes and Saddle Creek, which were totally weird and off the map five years ago, become huge. The mainstream record companies, if they want to survive, have to readjust their models from this idea of selling billions of records and spending lots of money on tours, fancy recording and marketing, because they can’t make enough money on record sales to do it anymore.

CN: If there are fewer moneymaking opportunities, it will attract people that are interested in finding and distributing new music, not people who are only interested in money. They just need to make enough to live comfortably. We need people in the job who are interested in the job, not the money, and they will do it better.

ISP: Is the public still going to demand a traditional superstar? Is there a contradiction in that the public demands it, but won’t spend enough money to support it?

CN: It doesn’t have to be as gigantic as it is now, but there will be a redistribution of wealth — the superstars won’t be as obscenely rich, and hopefully there will be much more innovative new music on the opposite end.

Passerby: This sounds like a Keynesian music model. It’s a music welfare state.

ISP: The problem is that there will always be someone who will give the people what they want. People won’t consume what they should consume. That’s what we have now.

CN: But if giving the people what they want results in a more popular product, it will be more adversely affected by downloading, since it will be easier to get. If record companies cared less about giving the people what they want, and cared more about putting out lots of interesting music, wouldn’t that be better?

ISP: That’s how indie labels do it. The guy that runs the label likes something, so he signs it.

CN: The superstar will die. As “stealing” music becomes more and more prevalent, they will try to stop it, but they can’t. They don’t want to adapt, but they will be forced to. Let’s make a stand for once. Let’s not let the corporations tread over us. We have them by the balls. We have the masses on their computers. Instead of a wave of people in the streets, it’s a wave of people in their bedrooms. They aren’t going to stop us. They can try suing us, but there will be more and more and more of us. And they have to improve. If they change, it’s going to be better anyways. There will be more and better artists to choose from. It’s better than the 10 videos on rotation on MTV. Labels survive by selling CDs for $8 to $10 and offering a good variety of artists, not by just hyping the album with lots of money, payola to the radio, magazines and television — that they probably own anyway.

ISP: I’m going to go get some ice cream.

CN: Me, too.

End transmission.
http://www.ucsdguardian.org/cgi-bin/...=2005_05_31_02


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Brocade Announces Wide-Area File-Sharing Hardware

It also unveiled its first switch-based application resource manager
Lucas Mearian

Brocade Communications Systems Inc. today announced several products, including an appliance-based wide-area file- sharing (WAFS) technology that the company will sell through an exclusive reseller agreement. Brocade said the new appliance will enable users in branch offices to back up and access files across a WAN.

The company also announced its first switch-based application resource manager, which one analyst said offers unique capabilities.

Brocade's announcements were part of this week's unveiling of its new Tapestry family of products. Tapestry includes Application Resource Manager software that resides in the company's SilkWorm family of switches and is used for dynamically provisioning and activating application resources on servers. The switch-based software is expected to be available by the second half of this year.

Brocade's new WAFS technology is a rebranding of the IShared server from Tacit Networks Inc. in South Plainfield, N.J. The technology, based on Windows for native integration with branch offices using Microsoft applications, allows users to centrally manage file backups.

"We drop in a core appliance at the main data center and then drop in edge appliances at branch offices. It allows you to have one instance of the files so you share the file in the data center with all remote offices," said Hugues Meyrath, director of product marketing at Brocade in San Jose.

The WAFS appliance uses a data-caching mechanism in the edge appliance so that changes made to files in remote offices are stored there and then transmitted over the WAN to the core box when bandwidth is available, Brocade said.

Brocade will have two versions of the Tacit box, one based on Windows and the other on Linux. "Clearly, the Windows version is the key solution," Meyrath said.

The company said that by the second half of this year, it will be selling a new application resource manager that extends to application servers widely used capabilities to discover components on a storage subnetwork. That is designed to enable provisioning and updating code to application servers as well as storage subsystems.

Brocade acquired the technology with its buyout of Redmond, Wash.-based Therion Software Corp. earlier this month for $9.3 million.

"If you plug a new server into the network, we can discover all the assets on it. Then we can do end-to- end provisioning from the server to the storage," Meyrath said. "You can load an application or patch firmware through this."

Rick Villars, an analyst at IDC in Framingham, Mass., said Brocade's Application Resource Management tool, while not unique, does take the concept of remote resource management further than other vendors have. "This is really more about server and application management. This ties together the operating system, application and data pieces," he said.

Brocade also announced a new director-class switch, the SilkWorm 48000, which doubles the number of ports and throughput over its predecessor, the SilkWorm 24000.

The 48000 has 256 ports and 4Gbit/sec. throughput. Brocade also announced a new departmental storage switch with 4Gbit/sec. throughput, the SilkWorm 200E. The 200E can have either eight or 16 ports.

Brocade said it will be selling its new products through OEM and channel partners, but it would not release pricing information.
http://www.computerworld.com/hardwar...102145,00.html


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Supreme Court Likely to Side with 'Grokster' in Internet File-Sharing Case
University at Buffalo

In MGM Studios v. Grokster, a case that could affect millions of consumers who use file- sharing software to copy music and video content, the Supreme Court likely will uphold a 1984 ruling stating that companies that offer copying technologies can not be held liable for copyright infringements of users, according to University at Buffalo Law Professor Shubha Ghosh, an expert on intellectual property and cyberspace law.

The Supreme Court is expected to announce a ruling on the case before the conclusion of its current session, ending in June.

"The decision will have implications not only for file-sharing, but for any company that creates technologies that can be used to copy copyrighted materials, including companies that make TiVo players, next-generation scanners and digital cameras," says Ghosh, who helped draft an amicus brief filed by Intellectual Property and Technology Law Professors in support of Grokster.

In the case, MGM, representing 28 of the world's largest entertainment companies, brought a lawsuit against Grokster and other makers of file-sharing products in an attempt to make them liable for copyright infringements of their users.

According to Ghosh, at issue is the continuing viability of the Supreme Court's 1984 landmark decision in Sony v. Universal City Studios, in which the court determined the liability of Sony VCR products in facilitating copyright infringement.

"The court ruled that since the VCR could be used in ways that did not infringe copyright, Sony would not be liable for copyright infringement," Ghosh points out.

"In Grokster, the court will decide whether the substantial non-infringing-use test is still the legal standard for liability of companies that produce copying technologies or whether the knowledge or intent of the creator of the technology will be considered for liability," he explains.

Ghosh predicts in Grokster the court likely will maintain the new-technology-friendly Sony standard of substantial non-infringing use.

"It is a workable standard and is the standard used in patent law, copyright's close cousin," Ghosh says.

"The court might tinker with the standard a little bit by saying that knowledge or intent of the creator can be taken into consideration," he adds. "But given the composition of the court, the standard is not likely to change although it will be a close decision, possibly 5-4 or 6-3.

"If the court does not change the standard, that means a victory for Grokster since a lower court applied the Sony standard in its April 2003 decision in favor of Grokster."

Ghosh has written on a wide variety of legal topics, including cyberspace, intellectual property, employment and antitrust issues. He is author of "AntitrustProf Blog" published by the Law Professors Blog Network, which assists law professors in their scholarship and teaching.

The University at Buffalo is a premier research-intensive public university, the largest and most comprehensive campus in the State University of New York. The UB Law School is the only law school in the SUNY system.
http://www.yubanet.com/artman/publis...le_21408.shtml


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Don't Hold Your Breath For 3G
Peter Cochrane

I just had a meeting with a group of young people who brought back a flood of memories from the 60s, 70s, 80s and 90s, when the UK population wanted commercial radio but the government of the day was wed to a BBC-only world. This resulted in offshore radio stations on trawlers 'illegally' transmitting commercial radio. The government and regulators were outraged, whilst the public and advertisers were delighted. The outcome? Commercial radio was legalised. Public action and opinion won the day!

Next the UK population wanted Citizen Band radio but the government and regulators of the day were wed to strict control. So the public started shipping in and using 'illegal' equipment from the US. The outcome? A de facto Citizen Band was established that ultimately had to be legalised. Again public action and opinion won the day!

During the same era the UK government demanded that all car radios be licensed. But the public refused and in a legal battle reminiscent of today's RIAA MP3 file-sharing wars, people were prosecuted for non-payment. The outcome? So many people refused to pay that the system collapsed and the government had to relent - and make all car and portable radios exempt. The power of public action won again!

Today that history looks all so quaint and the battles so unnecessary, just like the censorship of the works of DH Lawrence et al. Relaxing the controlling regimes has instead seen a flourishing of creativity and technology that no one predicted 50 or even 20 years ago. And yet we still have industries and governments trying to dictate, trying to control and trying to limit what we can and cannot do. A long time ago I decided that all such attempts were futile and my approach to technology has been to give it to the users and stand back to just observe what they do. It is the only satisfactory model I have found for getting business models right.

As my friend Alan Kay (he's ex-Apple) often remarks: "The best way to predict the future is to build it."

It was on this premise that I approached the prospect of 3G mobile systems through the mid to late 90s, right up to the UK licensing and rollout fiasco of the year 2000 and beyond. Despite the protestations of many including myself, the industry was raped of billions of pounds by government, over 250,000 jobs were lost, the technology was more than three years late, operators didn't share base station sites, there were no significant service offerings beyond those that had already failed during the WAP fiasco and costs were wholly uneconomic for individuals and companies.

As it turned out, the much celebrated '2Mbps to your handset' never happened and customers don't surf the web, send photographs or engage in videoconferencing via mobiles. In short, industry over-promised and under-delivered. If only government, regulators and industry had concentrated on the customers how different it might have been!

So here I am with a group of youngsters with their Swiss Army Knife mobile phones - i.e. they do absolutely everything imaginable but badly.

What do they do with them? In order of popularity it seems to go like this: text, talk, ring tones, pics, music and movies. I can hear the mobile executives salivating from here! Surely we can make lots of money out of ring tones, pics, music and movies - can't we? Sorry but no! Text is cheap and the primary user mode. Voice is used but only if you really have to. And the rest are mainly done offline using a USB cord or Bluetooth.

Then of course there is BlueJacking - sending messages and pics to people across a room at random or by design, mobile-to-mobile. Fun, eh? Lots of megabits being moved around but not over the mobile network.

My prediction: 3G will continue to limp along with the lukewarm support of an indifferent customer base and an industry trying to recover its sunk network and licence costs for a decade or more.

As for watching TV and movies over the mobile network, will people do it and will the industry make money? I might be wrong but my advice to the industry is: don't hold your breath! Pocket-sized full-colour TV sets have been available for years at less than $100 and don't sell in large numbers. On second thought, praying might be a safer bet than holding your breath.

Contrast all of this with the DIY world of Wi-Fi and VoIP, where the customers established the need and have largely funded the rollout. Interestingly this prospect was identified and proven probably as early as 1996 but the mobile and fixed operators had their sights firmly fixed on extracting an extra $1000 a year from every household in the land with a raft of new technologies and a questionable list of improbable services. Just where was the money supposed to come from?

Well, watch out for 4G, 5G, 6G etc... it is time to watch the users and the technology again!
http://networks.silicon.com/mobile/0...9130911,00.htm


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Intel Sees Broadband As Gateway To New Markets
David Hatch

Peter Pitsch's business card speaks volumes about his employer, Silicon Valley heavyweight Intel. One side is in English and the other in Chinese. That comes in handy when Pitsch, a spokesman and lobbyist for the company in Washington, conducts business in Asia, a burgeoning market for Intel's microprocessors. The globally friendly card underscores Intel's philosophy: it is always on the prowl for new markets and technologies that will spur sales of computers containing its silicon.

Intel may be synonymous with computer chips, but the company sees growth opportunities in a host of areas, from health care products to nanosize biotech transistors to Internet telephony. In April, Intel placed a huge bet on wireless broadband when it announced the launch of its first Wi-Max (Worldwide Interoperability for Microwave Access) chip. In late May, news reports indicated that the company is quietly talking to Apple about including Intel chips in Macintosh computers. "We are always looking to find new ways to exploit our silicon products and our manufacturing capability," Pitsch said in a late May interview with Technology Daily Special Correspondent David Hatch at Intel's office in the nation's capital.

Intel was once a stranger to Washington's political scene. The company played a minor role in lobbying over the watershed Telecommunications Act of 1996, a largely deregulatory law designed to foster more competition for phone and cable services. But Intel and other high-tech players, such as Google and Microsoft, have placed a growing emphasis on lobbying Congress and the Federal Communications Commission. Intel is also active at the state level, where it backs the creation of municipal broadband networks. The reason for emphasizing policy issues is simple: with technology outpacing regulation, small agile players can blossom seemingly overnight into juggernauts and one-time giants can be quickly sidelined as colossal dinosaurs.

Pitsch is no stranger to Washington's merry-go-round. He served at the FCC under two Republican chairmen in the 1980s--as chief of the Office of Plans and Policy under Mark Fowler and as chief of staff for Dennis Patrick. From 1980 to 1981 he worked on President Ronald Reagan's transition team. Before that, he wore several hats at the Federal Trade Commission, including attorney, legislative lobbyist and adviser. His name recently has been floated as a possible FCC commissioner.

Intel is unique in Washington in a key way: it often approaches issues indirectly, seeking to foster environments that would spur consumers to purchase computers containing its chips. That means strong support of broadband even though Intel has no direct stake in high- speed Internet access. Instead, Intel surmises that as broadband becomes widespread more consumers will buy computers with super-fast chips to harness its video capabilities. "It frequently means that Intel's interests align quite nicely with those of consumers," Pitsch said. The company takes the same approach with cable set-top boxes: it wants them available competitively in stores rather than bundled with cable TV service to create more opportunities for Intel technology.

An edited transcript of the interview follows:

Technology Daily (TD): Your name has been floated as a possible contender to fill a Republican vacancy at the FCC. (One GOP seat is vacant and another will open when Kathleen Abernathy, whose term has expired, leaves the agency). Are you still under consideration?

Peter Pitsch: Not that I'm aware of.

TD: Is this something you've been actively seeking?

Pitsch: Actively seeking? No.

TD: Are you seeking it in any manner?

Pitsch: I've long had a commitment to public service; I have great interest in these issues. I have sometimes considered going back to the FCC in some capacity. At this point in time, given the other names that are out in the public domain, I'm not actively seeking to be an FCC commissioner.

TD: Would you serve if nominated?

Pitsch: I'm not going to make a Shermanesque statement. (General William Sherman spurred the term "Shermanesque statement" after he said, "If nominated, I will not accept. If elected, I will not serve.")

TD: Why is the telecom reform debate on Capitol Hill so important to Intel?

Pitsch: These policies have a big impact on broadband deployment and competition. The better, more affordable and widespread broadband becomes, the better for Intel and many other companies in the high tech arena. We want consumers to have the option of getting the best possible broadband at the lowest possible price. If they see fit to buy it, they're more likely to want state-of-the-art microprocessors in their computers to use video-rich applications, and so on.

We have increasingly become focused on the importance of communications products, and therefore spectrum policy and reform has come to the fore. We care a great deal about the spectrum available for Wi-Fi (wireless fidelity), Wi- Max and UWB (ultrawideband communications), not just in the United States, but globally . . . The more spectrum that's available, the more opportunities there will be to embed communications silicon into products.

TD: What are your top priorities for telecom reform legislation?

Pitsch: We're focused on digital television reform, ensuring that broadband remains minimally regulated and related issues. We want universal service reform because that will promote facilities-based competition in urban and rural areas. We favor keeping the Internet and IP (Internet Protocol) services minimally regulated. A main priority is passage of digital television legislation. We want Congress to pass a bill creating an early date-certain for the return of [analog spectrum] by broadcasters . . . Under the current law it's unclear when they will return their analog channels. We think creating a date certain will produce numerous benefits.

TD: Why is an early return of analog TV spectrum so important?

Pitsch: We think the larger public interest benefits are enormous. You have the public safety spectrum that would become available, the auction revenues that would be generated, and the . . . roughly 60-78 megahertz of spectrum that would be freed for commercial purposes . . . [Using the vacated spectrum] Intel and other high tech companies will be able to make low-cost, wireless broadband technologies that will create valuable new services, make rural broadband cheaper and more available and enable laptop and PDA (personal digital assistants) wireless broadband on a low-cost basis.

TD: What makes the analog spectrum so appealing?

Pitsch: The propagation characteristics of the 700 MHz spectrum are quite favorable compared to the higher bands at roughly 2GHz. In rural areas, for example, 700 MHz would enable a wireless broadband operator to spend one- fourth of the capital costs on infrastructure that he would need to make at 2.5GHz.

These frequencies enable signals to go through buildings and cover wider areas. This means that laptop and PDA models become much less expensive -- you don't need to put transmitters on the top of every concrete building. Even in urban areas, you can cover wide areas initially with a very high quality level of service with few cell sites.

Intel, in turn, could work with [service] providers to embed Wi-Max capability into our Centrino Mobile Technology and dramatically reduce device costs, improve the quality of the experience, extend battery life, and so on, and that would be good for consumers, particularly in rural areas. If you look at the analogous situation of Wi-Fi, after Intel embedded Wi-Fi technology into our Centrino Mobile Technology, the Wi-Fi penetration in notebooks shot up . . . It was a substantial change very quickly. If you have a service based at 700 MHz you can put up fewer cell towers to cover a given area . . . If you can put up one-fourth of the cell towers, your capital costs will be one-fourth of what they otherwise would be.

If there is a date-certain [for the DTV transition] and the auction winner [of the analog TV spectrum] decides to use Wi-Max, we could obviously cooperate with them to make silicon for handsets and notebooks that complemented their investment in Wi-Max infrastructure. This would be beneficial to both sides.

TD: Can you live with the Dec. 31, 2008 "hard" transition date detailed in the draft House Energy and Commerce DTV bill?

Pitsch: I think that's an acceptable date. Of course we want it earlier. We would prefer that the auction date [of the analog TV spectrum] be moved up from the April 2008 timeframe, but we think this is a very good start.

TD: Do you support extending the USF subsidies to cover broadband?

Pitsch: Not directly. We support reforming universal service, both on the funding and pay out side, to make it sustainable competitively and technology neutral and efficient in the sense of not suppressing demand for services. And that does raise issues about what gets covered. We and the ITI (Information Technology Industry Council) will be involved in the telecom rewrite debate over universal service, and our general position is that funding should be collected through an end-user charge levied on companies providing communications services, including potentially broadband.

It would be a fixed end-user charge, and companies that provided service to eligible customers would be able to get the appropriate subsidy level, regardless of how the customer might be ultimately using the service.

So the money wouldn't just go to companies providing plain old telephone service (POTS). It might be the case that a company providing cable modem service or wireless broadband service would be eligible if they use VoIP (Voice- over-Internet Protocol) or other technologies to provide the minimally defined universal service: voice, ancillary, emergency services. That way, companies would compete in the marketplace for customers who . . . in effect would be making a choice about how they want their universal service provided.

We're not looking -- at this time -- to define universal service to include video-rich applications and other things that would require high-speed broadband service. We want it to be technology neutral, competitively neutral. We think that can be done even if one limits the definition of universal service to voice and ancillary services. Another way of looking at this is that you're opening up the competition for the provision of universal services to all technologies. Eligible consumers should be free to pick the technology and the company that they think best provides the service.

The level of subsidy would be calculated based on the minimal costs necessary to provide voice and emergency services. We are not increasing universal service to subsidize broadband. There are areas where it might cost $100 a month per line to provide plain old telephone service over existing copper plant. It's plausible to believe that wireless technologies might be able to do that for half price . . . Let's make this competitively and technology neutral, let's raise the money efficiently -- let's not suppress demand -- and let's do all of this in a sustainable way. I think this approach of collecting the money through an end-user charge and then paying it out in a technology neutral way is a good way to meet those criteria.

TD: What steps has Intel taken to support the creation of municipal broadband networks?

Pitsch: We have participated in various state discussions. We're very engaged in Texas, Florida, Colorado, Iowa, Oregon, Indiana. In some states we were involved through a larger coalition. Our position is: let the municipalities into this market. Again, we want to encourage multiple players, but we also recognize the legitimate interests of private concerns who might compete against these [entities]. Through the High Tech Broadband Coalition we created a series of guidelines that municipalities should follow.

We think that municipalities, when they get involved, should . . . make proposals through an open, transparent business process that would allow all comers to participate -- incumbents as well as new entrants. It should be technology and competitively neutral, with no favored treatment, and the private sector should be involved as deeply as possible. There are rural areas where no private company wants to offer service and maybe, in those cases, municipalities must be very deeply involved.

TD: What other incentives does Intel support for companies to offer broadband?

Pitsch: Intel, through ITI, has supported making funds available through the Rural Utilities Service (RUS) to wireless and wireline broadband services. However, we have not been directly involved on the issue for some time.

In the past, we supported a bill that would've created an investment tax credit for rural broadband -- it was technology neutral and not targeted at wireless. It would have allowed any broadband provider that met the criteria to receive an investment tax credit. That legislative effort, as far as I know, has little momentum now and Intel has not been very involved in it lately.

TD: What are Intel's main regulatory priorities at the FCC?

Pitsch: We'd like to see continuing spectrum reform. We want the FCC to make spectrum available on a licensed and unlicensed basis for wireless broadband technologies. There are a number of outstanding proceedings and other reforms they could take. We're not, by the way, looking for them to allocate frequencies just for services that use Intel's technology . . . The most valuable spectrum is between 300 and 3000 MHz. And the vast majority, perhaps over 80 percent of that spectrum, is locked into the old command- and-control rigid allocation process. Relatively little of it is available in a licensed, flexible way . . . And relatively little of it is available in a flexible allocation process that enables end users to gain unlicensed access to the spectrum.

TD: Why does Intel want the FCC to require TV stations to share their frequencies with unlicensed broadband networks?

Pitsch: We support an FCC rulemaking that could enable unlicensed use of vacant TV channels. The proceeding recognizes that in any given market relatively few television signals are using the entire TV spectrum, particularly outside urban areas. Through various approaches -- smart radio devices, control signals and other means -- we think it's possible for this white space, or vacant TV channel spectrum, to be used on an unlicensed basis. If the Commission does that, it would create valuable new services that would not interfere with the current broadcasting system. Even after the DTV transition we will have over-the-air digital channels operating from channel 2 to channel 51 and there will be a lot of white space.

TD: Intel sides with peer-to-peer (P2P) software developer Grokster in its legal battle at the Supreme Court against Hollywood over file sharing. Explain Intel's position.

Pitsch: We are not endorsing the Grokster business plan. However, we do not want the Supreme Court to undermine the Sony decision (the Supreme Court's 1984 decision in Sony v. Universal City Studios.) Under that decision, if a device had a significant, legitimate use, it was not illegal [even if there were copyright infringements]. If the rationale of the Sony case were undercut, that could severely limit our ability to innovate and sell PCs and other digital products . . . Requiring pre-approval of technology before it can be introduced in the marketplace would come at an enormous cost to Intel -- and be a huge impediment. We have very short product cycles. As you know from Moore's Law, we innovate enormously rapidly.

TD: When will Intel's new Wi-Max chips be available in laptops?

Pitsch: It's our expectation that within the next two to three years portable clients will be capable of receiving Wi- Max signals . . . Someone could buy a laptop with Centrino Mobile Technology that would allow them to use Wi-Fi or Wi-Max, depending on which is available.

TD: How bullish is Intel on VoIP, i.e. Internet telephony?

Pitsch: VoIP can be a major driver of broadband . . . which helps to promote demand for the state-of-the-art silicon products we make . . . It could be a great driver for wireless broadband, in particular.

TD: Where does Intel stand on the Central America Free Trade Agreement (CAFTA)?

Pitsch: We are strong supporter of CAFTA. We are going to strongly support the Administration's efforts to see it ratified. We think it will be important to consumers and to the general liberalization of trade . . . If there are more markets opened to U.S.-produced products it would be easier for us to sell and grow. If U.S.-made products are impeded through high tariffs, as they continue to be in some areas, that's obviously going to impede U.S. production.
http://www.njtelecomupdate.com/tb-JH...655255569.html


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Bertelsmann Gives P2P Another Try
Mark Fritz

German media giant Bertelsmann reportedly pumped $85 million into the beleaguered Napster between 2000 and 2002, before Napster finally declared bankruptcy and its remains were scooped up by Roxio. So what did Bertelsmann get for its $85 mil? The short answer is, nothing. However, Bertelsmann did get something from its dalliance with Napster: a profound respect for P2P technology and its potential for content distribution (especially of large media files). In fact, Bertelsmann apparently finds peer-to- peer so compelling that it has been willing to write off millions and start from scratch. The company has announced a new P2P file download platform called GNAB, set to officially launch around June. Gernot Wolf, spokesman for Bertelsmann subsidiary Arvato, says, "There is no relation between GNAB and Napster. Not a single line of Napster code was used while developing GNAB."

According to Wolf, what sets GNAB apart from the P2P pack is that it combines centralized and decentralized download. "There are a lot of P2P platforms and a lot of centralized download platforms, but we think we are unique in combining the two," says Wolf. This combination "opens new possibilities for the delivery and protection of content," he says.

Of course, decentralization is what gives P2P its power. "By splitting files into pieces, you can make good quality downloads and also make it economical," Wolf points out. The alternative—central downloading—is more problematic. "If you are centralized and you have a lot of clients, what if they all want to download the same movie file at 7:30 for their evening entertainment?" Wolf asks rhetorically. "You'd have 400 people, let's say, wanting the same file at the same time. You'd need a huge network to do that," he says. High user demand like this "produces the paradoxical situation that the more customers use a central system, the higher the distribution costs become."

Despite its downside, some centralization is necessary, says Wolf. It is the part of the puzzle that Napster left out and that led to its demise. It is GNAB's centralization that permits it to track its users to make sure content isn't stolen. "The central session control guarantees protection of copyrights and regulations of the licensors at all times, and ensures high quality of the files," says Wolf. With GNAB's digital rights management system, "Every file is signed," he adds.

However, in order to share in the power and convenience of GNAB's P2P network, one has to become an authorized part of that network through registration. Unfortunately, this centralized registration that enables DRM requires a big sacrifice. One must give up what is perhaps P2P's most popular feature—file sharing. "Yes, it is correct that a user cannot forward a file along to a friend," says Wolf. "But what a user can do is forward a link to specific content to a friend. So in this case, he can get an incentive for forwarding the link."

Avarto is aiming its GNAB service at ISPs, TV stations, radio stations, order houses, and mobile operators. Wolf calls these the "first row," or first tier of potential clients, though he feels that almost anyone who owns content could benefit from GNAB. Many companies, both large and small, could use P2P media distribution as a means of promotion. A big fast-food restaurant, for example, could offer free ringtone downloads to anyone who has accumulated $50 worth of receipts. The possibilities are endless, according to Wolf.

GNAB has completed beta testing and now is going through what Wolf calls "technical due diligence" testing with an unnamed client/user. Avarto expects an announcement from its first client within a few weeks. You can pronounce it "genab" or spell it out like an acronym, but the company says the name really doesn't stand for anything. The fact that it includes the word "nab" may bring to mind Napster's darker side, though Wolf notes with a chuckle that if you reverse GNAB, it spells BANG.

"Bang for the buck" may not have a literal translation in the German language, but Bertelsmann clearly sees that P2P offers content owners a bigger bang for their Euro, and the company obviously hopes that its investment in P2P will translate into bigger bucks, Marks, and Euros in the long term.
http://www.econtentmag.com/?ArticleID=8070


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Waddya know

Terrorist Link To Copyright Piracy Alleged
Declan McCullagh

Counterfeit DVDs and cigarettes may be funding terrorists.

That's what the Senate Homeland Security committee heard Wednesday from John Stedman, a lieutenant in the Los Angeles County Sheriff's Department who's responsible for an eight-person team of intellectual property (IPR) investigators.

"Some associates of terrorist groups may be involved in IPR crime," Stedman said. "During the course of our investigations, we have encountered suspects who have shown great affinity for Hezbollah and its leadership."

Even though Stedman's evidence is circumstantial, his testimony comes as Congress is expected to consider new copyright legislation this year. An invocation of terrorism, the trump card of modern American politics, could ease the passage of the next major expansion of copyright powers.

Steadman said he saw Hezbollah flags and photographs of the group's leader in homes that he raided, coupled with anti-Israel sentiments on the part of those arrested.

But another witness, Kris Buckner, the president of a private investigation firm that looks into intellectual property violations, said: "I am also frequently asked if terrorist groups profit from the sale of counterfeit goods. I do not know the answer to that question." Buckner has, however, heard "subjects make anti-Israeli and anti-Jewish statements" on raids.

The 9/11 Commission never managed to link Hezbollah to the Sept. 11, 2001, terrorist attacks. But the commission claimed that Iran and Hezbollah provided assistance to al-Qaida on other occasions, including joint training exercises.

Matthew Levitt, a senior fellow at the Washington Institute for Near East Policy who also testified, said that "Hezbollah depends on a wide variety of criminal enterprises, ranging from smuggling to fraud to drug trade to diamond trade in regions across the world, including North America, South America and the Middle East, to raise money."

Hezbollah has attacked U.S. forces in Lebanon and Saudi Arabia and Israelis in many countries.
http://news.com.com/Terrorist+link+t...3-5722835.html


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TiVo-Like Devices For Radio Raise Piracy Fears

It's like TiVo for radio, but is it legal?

Various devices that enable listeners to record Internet radio streams and then convert them into MP3 files are catching on and making Web radio and streaming services more appealing to the general public.

But some legal experts say the recording software may violate digital copyright laws and does little more than promote piracy.

"Obviously if people can use the TiVo-like unit to download a recording from Web radio and preprogram it to search digital radio to find tracks that you want, it's going to beg a big question with the record industry," said Jay Cooper, an veteran entertainment lawyer. "The thing to ask is if it is a violation and does it need to be examined. Technology's way ahead of the law."

Cooper said that, under the Digital Copyright Millennium Act, users have no right to duplicate copyrighted material from a computer hard drive, only from a digital or analog recording device and then only for personal use and not for redistribution.

Webcasters similarly are restricted from promoting the recording of their content.

But with products such as San Francisco-based Applian Technologies' Replay Radio, users can split, chop, trim and edit their recorded MP3 files from streamed music services.

The company's Web site says the product "works like a TiVo for Internet Radio" and can turn streaming music into perfectly tagged MP3 song files.

"There's certainly a lawsuit waiting to happen because they're basically enabling consumers to record and the recordings are not authorized," said Jonathan Potter, executive director of the Digital Media Association.

But Tom Mayes, co-owner of Applian, defended the practice.

"We've been doing this for a long time," he said, noting other software recording programs were offering similar functions. "I think it's too late for these (record) companies to try to put a stranglehold (on technology)."

On its Web sites, the company said its products are not intended for use in circumventing copy protection or making illegal copies of coyprighted content.

But at least two Webcasters have raised a red flag about Replay Radio. RealNetworks' Rhapsody sent Applian a letter requesting it take Rhapsody's name off a Web page that lists streaming music services that work with the software.

"Using software like Replay Radio to record Rhapsody subscription streams violates our terms of service," said Matt Graves, a spokesman for Rhapsody.

Yahoo's MusicMatch concurred.

On Replay Radio's Web site, the company has partially obscured the reference to Rhapsody and MusicMatch, by inserting hyphens for parts of the spellings.

"Rhapsody sent us a note from their legal department telling us not to use their name on our Web site and I said OK," Mayes said.
http://news.com.com/TiVo-like+device...3-5724494.html


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Thunderbird Gets Podcasting Support
Renai LeMay

Developers of the Mozilla Foundation's open-source e-mail client have added a podcasting feature to its arsenal and improved its defense against phishing attacks.

The changes were highlighted Tuesday in a Mozilla blog that discussed modifications to the software before its upcoming 1.1 release. They are not available in the current 1.0.2 release.

Podcasting is a recent Internet phenomenon which takes its name from Apple Computer's iPod digital audio player. Podcast creators publish sound files online that are then downloaded by interested parties. The technique uses RSS, or Really Simple Syndication, which allows simple forms of content such as blogs to be repetitively syndicated across the Internet and has enabled many people to reach a global audience with self- published radio shows.

Thunderbird already supports RSS feeds as they are commonly used by blogs, but a new patch will deal with Podcast-type content by opening a dialog box through which the user can summon a helper application such as a Web browser or audio player.

The antiphishing feature attempts to detect and warn about incoming e-mail-based scams that prompt users to enter information such as Internet banking login details or credit card numbers. Since January, the feature has detected dodgy Internet address data, but it will now also pick up any e- mail that requires information to be entered via an HTML form.

Large Web-based e-mail sites such as Microsoft's Hotmail and Google's Gmail have recently implemented a similar feature that will warn users.

Other key planned features for the 1.1 release include an improved spell-check engine that would operate as a person types, the ability to automate the software updating process, and improved integration with antivirus applications for users of e-mail boxes based on the POP3 standard.

A number of smaller changes will involve user interface changes, the ability to save space by deleting attachments from stored e-mail, and an automatic "save as draft" feature.

While the list of features for the e-mail client is still a long way behind offerings like Microsoft's Outlook and even other open- source clients such as Evolution, Mozilla has long-term plans in place to improve it.

Developers list close collaboration with the Lightning Project--which aims to integrate the open-source Sunbird calendaring solution into Thunderbird--as an agenda item for the far-off Thunderbird 2.0 release. They would also like to "solve the information overload problem" common to heavy e-mail users by looking into implementing a tabbed solution similar to the one used by Web browsers such as Firefox, Opera and some third-party Internet Explorer add-ons.
http://news.com.com/Thunderbird+gets...3-5729671.html


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ILN News Letter

French Class Action Suit Launched Over DVD Copy Protection

BNA's Electronic Commerce & Law Report reports that a group of French attorneys have filed suit against six of France's leading audio-visual sector firms, claiming that the use of anti-copy technology on DVDs violated consumers' right to make private copies for personal use. The complaint is largely based on a French appellate court's recent ruling that the use of anti-piracy technology to protect DVDs from unauthorized copying usurps consumers' right to make personal copies. Copy of the suit at http://www.classaction.fr/actions/action1/service1.htm Article at <http://pubs.bna.com/ip/BNA/eip.nsf/is/a0b0x5n8j0> For a free trial to the source of this story, visit
http://www.bna.com/prodcuts/ip/eplr.htm


Stolen PC Had Credit Card Info On 80,000 Justice Employees

Federal and local authorities in Fairfax, Va., are investigating the recent theft of a computer containing the credit-card information of 80,000 Justice Department employees. The Justice Department has been notifying employees and asking them to monitor their accounts and cancel the government-issued credit cards if they notice suspicious activity.
http://online.wsj.com/article/0,,SB1...546650,00.html


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States Keep Watchful Eye on Personal-Data Firms
Brian Krebs

A legislative push by states to punish companies that maintain sensitive customer data when they hide a security breach could trigger congressional intervention to set a national standard on when people must be notified that their personal information may have fallen into the wrong hands.

Seizing upon recent incidents in which companies admitted losing or failing to secure their customers' financial and personal information, nearly two dozen states are debating or have passed new legislation, including a tough North Dakota law -- which takes effect today -- that forces companies to reveal unauthorized access to information that is commonly found in phone books.

A number of commercial data aggregators -- companies like ChoicePoint Inc. and Axciom that assemble dossiers of information on people for sale to corporate clients -- have recently alerted hundreds of thousands of people whose records they kept that their data may have been compromised. The disclosures resulted -- at least in part -- from a recent California law that uses the threat of civil lawsuits to goad companies into disclosing when a digital break-in or data theft exposes customers in the state to identity fraud.

Encouraged by the law's apparent success in forcing disclosures, a number of states are rushing to establish penalties for companies that don't alert customers in a timely manner if they discover that personal and financial information has been lost, stolen or otherwise improperly disclosed. In the past four months alone, laws went on the books in Arkansas, Georgia, Montana, North Dakota and Washington.

Similar pieces of legislation in Florida and Illinois are awaiting governors' signatures. Last month New York City Mayor Michael Bloomberg signed a security breach notification bill, while New York state also appears to be on track to pass a theft-disclosure bill. Indiana lawmakers recently passed legislation that would require state agencies to notify residents if their Social Security numbers are divulged.

The fines envisioned in some of the state measures are substantial. The Florida statute would fine companies $1,000 for each day that they fail to disclose a data breach to customers. After the first 30 days, companies would be hit with monthly fines of $50,000. A spokesman for Florida Gov. Jeb Bush (R) said the governor had not yet received the measure, and so could not comment on whether Bush intended to sign it. If signed into law, the measure would take effect July 1.

Lawmakers in Georgia were spurred into action in February when Alpharetta-based ChoicePoint said fraud artists had posed as Los Angeles businessmen to access personal information about at least 145,000 people. A key sponsor of that bill, Georgia state Sen. Bill Hamrick (R), said he backed the law when it became clear that consumers may never have known about the breach had it not been for the California law.

The Georgia law applies mainly to companies like ChoicePoint, but Hamrick said data firms lobbied for the law to apply to all businesses. "That would have essentially killed the bill since we only had 40 days to debate it" before the end of the state's legislative session, Hamrick said. Still, he said he intends to examine expanding the scope of the law next year.

Robert Ellis Smith, a privacy expert and publisher of Providence, R.I.-based Privacy Journal, applauded the state actions, saying it is important for people to know about such incidents so that they can take the appropriate steps to ensure that their identity is not stolen. "It seems to me elementary that people are entitled to know if their information is compromised," Smith said.

Georgia's new law went into effect in April, the one in Washington activates July 24, and Arkansas's goes live Aug. 12. Montana residents will see protection starting in March 2006. In North Dakota, where most laws go into effect on Aug. 1 of a legislative year, state lawmakers made it effective June 1 by declaring the bill an "emergency measure," which required passage by at least a two-thirds vote in both houses.

But taken together, the state laws may backfire as businesses lobby Congress to enact new -- and most likely less stringent -- federal statutes to preempt what critics say is quickly amounting to a patchwork of disparate, confusing and costly new regulations.

"It's really hard to defend against these types of laws. No [state lawmaker] wants to be on record saying, 'Maybe this is a bad idea,' because they're going to get beaten up and cast as not caring about consumers," said Stewart Baker, a partner with Washington, D.C.-based law firm Steptoe & Johnson. "But to the extent that all of these state laws deviate from the California statute, they create a massively confusing situation in which businesses have to go state by state to figure out what their obligations are to consumers."

Critics of the multi-state approach say that due to the potential monetary, logistical and public-relations headaches that could come from establishing different requirements and penalties in each state, companies will soon be forced to set their overall policies to satisfy the state with the most stringent law.

Currently that state is North Dakota, where in April Gov. John Hoeven (R) signed a law that goes far beyond the California statute in its classification of what constitutes "personal identifying information." Beginning today, companies doing business in the state will be required to disclose a data theft if the company loses track of any customer information -- including information not generally considered "private," such as names, addresses or telephone numbers.

"Business aren't going to laugh and say, 'Well, North Dakota's just being silly,'" Baker said. "They're going to be pushed in the direction of doing what North Dakota says across the board."

Faced with this prospect, business groups might consider supporting a federal law that would preempt state laws. U.S. Sen. Dianne Feinstein (D-Calif.) in January introduced a bill that would effectively make California's statute the law of the land. Mike Zaneis, director of congressional and public affairs for the U.S. Chamber of Commerce, said support for a federal approach is building within the business community, but that any federal legislation would need to strike a reasonable balance between notifying consumers and needlessly scaring them or inuring them to such notices.

"There has to be some trigger for notifications that distinguishes between a breach that is quickly contained and one that is likely to do harm," Zaneis said. "What we don't want is for consumers to become desensitized to these notices, because then no one is going to react when there's a real problem, to take the appropriate precautions."

Many consumer groups are quietly advocating a national law because it would make it easier to educate consumers about their rights and about what to look for in such disclosures, said Ari Schwartz, associate director at the Center for Democracy and Technology in Washington.

But Schwartz said his and other privacy groups would like to ensure that any national notification law also sets basic security standards for businesses. The California law and other state measures adopted in its wake would not require companies to disclose a security breach if, for example, the data compromised in the break-in was scrambled with encryption technology.

Montana Attorney General Mike McGrath said the states would fight vigorously any attempt to pass federal legislation that supercedes stronger state laws. Montana's new law would fine companies up to $10,000 per violation for failing to disclose a security breach that endangers customer data. Companies also could face criminal charges if they take steps to hide consumer data thefts.

"I don't think there should be any sort of laissez-faire attitude in Washington about protecting the privacy of consumers," McGrath said. "I think it's fair to say that on a bipartisan basis, the state attorneys general are very concerned about federal preemption in this area, which obviously the industry folks would just love."

ChoicePoint spokeswoman Kristen McCaughan declined to comment on the Georgia law or say whether the company would support any specific proposed bills currently before Congress. But McCaughan said ChoicePoint supports a mandatory notification law that is national in scope and preempts state laws. She said the company also would support a bill that defines "personally identifiable information" the same way it is spelled out in the California law: a person's name along with either their Social Security or driver's license number, or financial information.

Millions of consumers have been exposed to potential identity theft in 14 major breaches in the past year at various brokers, universities, banks and other institutions. After the ChoicePoint breach, media reports soon followed that Bank of America Corp. lost computer tapes containing financial data on 1.2 million federal workers, including U.S. senators, and that credit card numbers were stolen by hackers from 103 of shoe retailer DSW Inc.'s 175 stores.

In May, Wachovia Corp. and Bank of America Corp. notified more than 100,000 customer that their financial records may have been stolen by bank employees and sold to collection agencies; investigators are still looking into that case, which may involve the unauthorized sale of data on nearly 700,000 customers of various banks.

The California Department of Consumer Affairs reported May 27 that since the state's notification law went into effect in July 2003, it has been aware of 61 significant breach notifications involving an average of 163,500 individuals each. About one-fourth of the breaches occurred at financial institutions and another one-fourth at universities, with 15 percent reported by medical institutions, 8 percent by government and 7 percent by retailers, according to the figures.
http://www.washingtonpost.com/wp-dyn...060100359.html


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SBC Ups The Ante In Broadband War
Marguerite Reardon

SBC Communications' move to slash prices on its DSL service could spur a pricing war between phone companies and their rivals in the cable industry, say analysts. But cable companies say they're competing on value rather than price.

SBC, the second-largest phone company in the United States, announced Wednesday that it will reduce the price of its DSL service for new subscribers to $14.95. This is the deepest discount that a phone company has given for broadband services, well below the $23.90 that America Online charges for unlimited dial-up Internet access.

Analysts predict that the sharp price cut will put pressure on cable operators such as Comcast, Time Warner and Cox Communications to slash prices on their services as well.

"SBC has taken things to the point where the price differential is really stark between DSL and cable modem service," said Jim Penhune, an analyst with Strategies Analytics. "At this point, with DSL almost half the price of cable services, I think the cable companies don't have much left in their argument for speed over price."

The cable companies say they have no plans to drop prices to compete with SBC. "Our take on competition for broadband is to offer more value to our customers," said Jeanne Russo, a spokeswoman for Comcast, which competes with SBC in several states, including parts of Texas and California.

But analysts caution that the writing is already on the wall, and that cable operators will have to do something.

"I'm sure they will wait to see what the subscriber numbers look like for the next quarter or two before they react," said Penhune. "It will likely start at the local level, where cable operators may reduce prices or offer promotions to compete."

The power of price

SBC and other phone companies have always used price cuts as a way to compete against the cable companies, which got a head start in the market in the mid-1990s. Since that time, the phone companies have been playing catch-up to their cable rivals, which still dominate the broadband market with roughly 59 percent of all subscribers.

Competition between the two sets of companies is heating up even more now as cable companies including Cox and Time Warner also start offering telephone service along with television and high-speed Internet service.

Making matters worse for the phone companies is the fact that their traditional telephone businesses have been in steep decline for the past several years as more and more customers cancel local phone service and instead use cell phones or new Internet-based phone services such as Vonage.

SBC's strategy is simple: The company wants to sign up as many new subscribers as possible.
In order to fight back, the phone companies have been steadily lowering prices and offering customers different tiers of service at reduced prices. Verizon recently increased speeds and kept its price of $29.95.

So far, the pricing strategy has helped phone companies gain some market share. In 2004, DSL had about 41 percent of the market, up from 39 percent the year before. Experts attribute most of the recent jump in DSL subscriptions to the phone companies' more aggressive pricing strategies. This trend is expected to continue with cable and DSL splitting the market evenly in the next three to four years.

SBC's strategy is simple: The company wants to sign up as many new subscribers as possible. The idea is that the more DSL subscribers it has, the easier it will be to sell them other services such as telephony and, eventually, television. SBC is already in the process of upgrading its network to carry television service over its existing DSL lines.

While Project Lightspeed, which will extend fiber deeper into the network to support higher bandwidth for Internet-routed TV, is SBC's answer to the cable company's "triple play" service offering, the reality is that SBC's service won't be ready for more than a year. What's more, rollout of the television service could take even longer since SBC could be required to go city to city to negotiate franchise agreements.

SBC and Verizon Communications, which also has plans to offer television services over a new network it's building, suffered a serious blow over the weekend in Texas, when the legislature failed to act on a bill that would have allowed new entrants to the television market to get a statewide franchise. Similar laws are being considered in other states.

As SBC stares this reality in the face, signing up subscribers no matter what seems to be a top priority.

"It's all about driving DSL growth," said Wes Warnock, a spokesman for SBC. "Broadband is a sticky product, and it helps us compete against the cable companies. It also offsets the access line loss, so it's strategically significant."

Reading the fine print

While the list price for SBC's new service is far below that of competitors' offerings, it is not without conditions. First, the $14.95 price is a promotion, and it's good for only one year. After that, subscribers pay whatever regular rate SBC is charging at the time.

Customers must also agree to a one-year contract for the service. If they decide to terminate the service before the contract expires, there's a $200 cancellation fee. And finally, the $14.95 rate is only available for customers who also subscribe to SBC telephone service, which most can get for about $20 a month.

Some cable competitors argue that customers get a better value from their services. For example, Time Warner is offering a promotional rate for its high-speed service--$29.99 a month for the first six months. Once the promotion period ends, the price jumps to $39.95.

Unlike SBC, which requires subscribers to also get a phone line, Time Warner customers can sign up for high-speed access without subscribing to any other cable service. What's more, the Time Warner service offers connection rates of 5mbps, whereas the $14.95 offer from SBC provides only up to 1.5mbps.

Cox offers a 256kbps broadband connection for $24.95 a month. The service is not a promotion and is offered throughout its service region. It also doesn't require subscribers to sign up for any other Cox services and it doesn't require a contract.

But if push comes to shove in a particular market, the company could respond on a local level, said Bobby Amirshahi, a spokesman for Cox.

"It's not in our plan right now to lower our rates," he said. "But we allow each market to do whatever it needs to do to react to changing market conditions."

As for the other Baby Bells, which do not compete head-to-head against SBC for DSL customers, Verizon and BellSouth both say they have no immediate plans to lower pricing on their DSL service.
http://news.com.com/SBC+ups+the+ante...3-5728629.html


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EU Gives Wales Green Light To Go Digital

Wales can invest in rolling out high-speed Internet access to remote areas, the European Commission said on Wednesday, approving the state aid.

The EU executive Commission will also partly fund the broadband infrastructure roll-out. The Commission did not provide any figures for the amount of aid.

"The measure by the Welsh Assembly government ... will bring first generation broadband to currently underserved regions of Wales allowing citizens to exploit the benefits of broadband technologies," it said in a statement.

These so called "blackspot" areas are localities where broadband services are not available and that are not considered by market players as commercially feasible.

The areas include the 35 telecommunications exchange areas not figuring on BT Group's roll-out program, as well as communities that are disadvantaged for technological or topological reasons, i.e. they are located too far from an asymmetric digital subscriber line (ADSL)-enabled telecommunications exchange.
http://uk.news.yahoo.com/050601/80/fk77t.html


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Code-Abiding Porn to Get .xxx Domain

Address Change Could Aid Parents' Filters
Mike Musgrove

The nonprofit organization that oversees Internet addresses has approved a new online neighborhood specifically for pornographic Web sites: the .xxx domain.

The Internet Corporation for Assigned Names and Numbers said on Wednesday that it had approved a new "top-level domain" specifically for adult-oriented Web sites that voluntarily agree to adhere to a set of "industry best practices." Sites with addresses ending in .xxx, for example, will agree not to carry material that exploits minors. Other conditions for the new Internet address are still in the works, according to a statement from ICANN.

The decision by ICANN to sponsor an adult-content domain is a reversal of the group's previous stance; the organization turned down a proposal to create a .xxx domain in 2000.

Bob Corn-Revere, an attorney working on behalf of ICM Registry, the company that would administer the addresses when they start to go online later this year, said adult-content sites might have many reasons for wanting to change their addresses to a .xxx suffix.

Under the Protect Act passed by Congress in 2003, for example, adult-content Web sites with misleading addresses could be held liable if it is found that they are exposing children to adult content. "This would certainly prevent any problems with that," he said.

Parry Aftab, executive director of WiredSafety.org, an Internet group that works to protect consumers and children online, called the new Web domain "an important step in protecting children," partly because it will encourage pornographers to stick to one type of Internet address that can easily be filtered out by software that tries to protect Web-surfing children from seeing adult content.

But some worry that having a Web domain reserved for adult content goes against the open spirit of the Internet and could lead to censorship.

"The bottom line in this is, this is about a lot more than pornography," said Lauren Weinstein, co-founder of People for Internet Responsibility, a grass-roots group dedicated to analysis and education technical issues. "It's voluntary until it's not voluntary."

Corn-Revere disputed Weinstein's objection to the .xxx domain. "It is not designed to be and could not be sustained as a mandatory addressing system," he said.
http://www.washingtonpost.com/wp-dyn...060201927.html


















Until next week,

- js.














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