Peer-To-Peer News - The Week In Review - August 2nd, '08

[JackSpratts]

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"Obviously if reporters can’t access all the sites they want to see, they can’t do their jobs. Unfortunately such restrictions are normal for reporters in China, but the Olympics were supposed to be different." – Jonathan Watts


"There's plenty of room for questioning the networks' performance and watching closely for symptoms of Obamamania. But could we at least remain focused on what ABC, NBC and CBS actually put on the air, rather than illusions that their critics create to puff themselves up?" – James Rainey




































August 2nd, 2008




‘Dark Knight’ Wins Again at Box Office
Brooks Barnes

Batman fever continued over the weekend, with ticket sales for “The Dark Knight” far outpacing the competition and breaking a fresh batch of box-office records.

“The Dark Knight” sold an estimated $75.6 million in tickets at North American theaters from Friday to Sunday, according to Warner Brothers. Among other records it delivered the best second-weekend gross in recent Hollywood history.

“This picture has really taken on a life of its own,” said Dan Fellman, Warner’s president for domestic distribution.

The success of “The Dark Knight” is an example of what can happen when an array of factors coincide very much by accident, industry analysts and studio executives said.

An expertly executed promotional campaign from the studio’s marketing chief, Sue Kroll, helped build anticipation for the performance as the Joker by Heath Ledger, who died in January. The brooding film, directed by Christopher Nolan, also fits the nation’s mood, Warner Brothers executives said. The sour economy is probably helping, as movies are still a relatively affordable form of entertainment.

“We are starting to see a lot of repeat business,” Mr. Fellman said. “Older audiences are also starting to turn out in big numbers.”

Going into its second weekend “The Dark Knight” may also have benefited from a storm of publicity that came when its star, Christian Bale, was questioned by the police in London after his mother and sister accused him of assault. Mr. Bale denied the accusations and was released without being charged.

“The Dark Knight” has sold $314.2 million in tickets domestically in its first 10 days of release, a record. The film is still rolling out internationally.

The weekend was not as kind to 20th Century Fox. The studio’s “X-Files: I Want to Believe,” a big-screen revival of the hit television series, sold an estimated $10.2 million in tickets in North America. It landed in fourth place, narrowly ahead of “Journey to the Center of the Earth,” which sold $9.5 million in tickets — $72 million total since its July 11 release. Chris Aronson, Fox’s senior vice president for distribution, said that “X-Files” had also sold $9.3 million in tickets in its limited overseas release, and as a result, the $30 million movie “will be more than profitable at the end of the day.”

“Step Brothers,” starring Will Ferrell and distributed by Sony’s Columbia Pictures, opened in second place with an estimated $30 million in domestic ticket sales, demonstrating continuing demand among younger moviegoers for sophomoric comedies.

In third place was “Mamma Mia!” with an estimated “$17.8 million in sales ($135.3 million total). The second-weekend performance of the musical, distributed by Universal Pictures, was strong, dropping just 35 percent, one of the lowest dips of the summer among wide releases.
http://www.nytimes.com/2008/07/28/movies/28box.html





Secrecy Cloaked 'Dark Knight'

Warner Bros. took painstaking care to thwart pirates ahead of the film's premier, and the effort paid off.
Dawn C. Chmielewski

For Warner Bros., the mission was to keep "The Dark Knight" from seeing the light of day.

In an era of instantaneous digital copying and widely available high-speed Internet access, the premature and unauthorized release of a movie to the public -- especially a coveted summer blockbuster -- can spell disaster. If the movie's a stinker, the word will travel at the speed of a mouse click, ruining chances of making back money. And if the movie's popular, piracy can rob ticket sales and cut into revenue.

Executives at Warner Bros. knew they didn't have to worry about the first scenario: Buzz had been building for months about late actor Heath Ledger's performance as the Joker and director Christopher Nolan's dark rendition of the Batman legend. And marketing surveys pointed to a record-smashing opening weekend for "The Dark Knight" at the box office.

Instead, Warner Bros. was worried about what would happen if a copy of the movie slipped into public before the theatrical opening, which would result in it competing against pirated DVD copies. The ardent fan-boy appeal of "The Dark Knight" created opportunity and risk in equal measure for the studio.

The Batman sequel's core audience of superhero geeks is the same group of young men who gravitate to online file-sharing communities. Fear that pirated copies would pop up on the Internet during the film's crucial opening weekend prompted Warner to devote six months to an unprecedented anti-piracy strategy, painstakingly locking down the movie as it moved from production to post-production to movie theaters.

Warner created a "chain of custody" to track who had access to the film at any moment. It varied the shipping and delivery methods, staggering the delivery of film reels, so the entire movie wouldn't arrive at multiplexes in one shipment, in order to reduce risk of an entire copy being lost or stolen. It conducted spot checks of hundreds of theaters domestically and abroad, to ensure that illegal camcording wasn't taking place. It even handed out night-vision goggles to exhibitors in Australia, where the film opened two days before its U.S. launch, to scan the audience for the telltale infrared signal of a camcorder.

Warner Bros. executives said the extra vigilance paid off, helping to prevent camcorded copies of the reported $180-million film from reaching Internet file-sharing sites for about 38 hours. Although that doesn't sound like much progress, it was enough time to keep bootleg DVDs off the streets as the film racked up a record-breaking $158.4 million on opening weekend. The movie has now taken in more than $300 million.

The success of an anti-piracy campaign is measured in the number of hours it buys before the digital dam breaks.

"One of the reasons why it's so important to try to protect the first weekend is that it prevents the pirate supply chain from starting," said Darcy Antonellis, president of Warner's distribution and technical operations. "A day or two becomes really, really significant. You've delayed disc manufacturing that then delays distribution, which then delays those discs from ending up on street corners for sale."

Piracy experts say such tight security measures are now commonplace among studios seeking to protect big-budget summer blockbusters.

Studios fear a reprise of the "Hulk" piracy debacle. A rough, early version of Ang Lee's 2003 summer movie made its way to the Internet two weeks before the film's scheduled premiere, provoking negative reactions from the comic-book film's devoted fans, whose opinion carries far more weight in determining the success of this film genre than that of mainstream film critics.

"A lot of people decided not to go near it. Hollywood argued, correctly, that many more people would have gone to see it, had online buzz not been so critical of the movie," said Eric Garland, chief executive of BigChampagne Online Media Measurement, which monitors file-sharing networks and is a consultant to the entertainmentindustry.

"Hulk" still had an impressive opening, grossing $62 million in its first weekend. But by the second week, mediocre reviews and corrosive word of mouth pushed grosses down 70%. The studios aren't eager to give the audience advance -- and uncontrolled -- viewings of its tent-pole films.

"If the movie's a stiff, and word gets out too early that it's a stiff, it's devastating to the business model," Garland said.

Paul Kocher, president of Cryptography Research Inc., a San Francisco company that develops anti-piracy technology, said that unlike with music, one viewing of a film -- even in blurry, camcorded form -- often is enough.

"With rare exception, once you've seen the movie you're unlikely to watch it a second time," Kocher said. "You don't have the benefit the music guys have, that piracy can help build buzz. For the movie industry, it's purely a destructive force."

Studios use tracking methods to keep tabs on who handles a film and when, and mark the prints sent to theaters. That makes it possible to identify where a pirated copy was recorded, Kocher said.

The thorniest issue, when it comes to anti-piracy measures, is advance screenings. Studios balance the desire to perform the kind of rigorous bag checks that would make airport security blush against the fear of antagonizing critics.

"That's the one where there's the endless debate about what you do," Kocher said.

Big-budget summer popcorn flicks hold powerful lure for Internet bootleggers. Last year's Disney/Pixar Animation Studios animated film "Ratatouille" leaked out five days ahead of its cinematic premiere, and George Lucas' 2005 film, "Star Wars: Episode III Revenge of the Sith," similarly found its way to file-sharing networks days before it reached the big screen. The illicit Star Wars copy contained time codes indicating it slipped out of post-production. It nonetheless went on to gross $380 million domestically.

Michael Robinson, the Motion Picture Assn. of America's director of North American anti-piracy, said all the studios had improved security at post-production facilities. The trade group, in turn, uses a combination of gumshoe tactics and technology to crack down on piracy after the fact, going so far as to follow suspected pirates into theaters.

"At any given time, there are only a handful of truly professional camcorders out there who are recording," said Robinson, who spent 30 years in law enforcement, including a dozen years as head of the Michigan state police. But all it takes is one good-quality recording to generate thousands of Internet downloads and bootlegged DVDs sold at swap meets.

MPAA investigators used the lure of "The Dark Knight" to catch a suspected bootlegger in the act during a 9:40 a.m. showing in a theater in a southeast suburb of Kansas City, Mo.

A Lee's Summit Police Department spokesman said the MPAA investigators spotted the man in the back row of the theater, trying to cloak his video camera with black tarps as he allegedly made an illicit recording. A subsequent police search of the man's home turned up hundreds of DVDs that are believed to be pirated, the spokesman said. The case has been referred to the FBI.

"This wasn't necessarily one of our most covert operations," Robinson said. The investigators in the theater looked like G-men from central casting, wearing MPAA letters emblazoned on their shirts. "It was kind of brazen on this guy's part. Maybe he thought all the MPAA did was rate the movies."

It's hard to quantify how the broad availability of pirated online copies of films affects box-office receipts. But a study commissioned by the MPAA found that Hollywood's major studios lost $6.1 billion to film theft in 2005.

Warner Bros took no chances with "Dark Knight," a movie that opened in 12 overseas markets before it reached the U.S. It even maintained a swat team of sorts, composed of the piracy and production teams, which remained in constant contact as they continuously scanned the pirate networks throughout the weekend for illicit copies.

"As we have often said, we view piracy as a competitor," Warner distribution chief Antonellis said.

Still, the anti-piracy hurdles are enormous, and in the end success is determined by how long a studio can stave off the inevitable.

The first pirated copy of "The Dark Knight" was available on a top-level pirate site by Friday night, two days after its Australian premiere, said Mark Ishikawa, chief executive of BayTSP Inc., a Los Gatos firm that does online tracking of copyrighted works. By Sunday, it could be downloaded on BitTorrent file-sharing sites or viewed on YouTube, he said.

"Such a widely released film in such high demand, by virtue of its following, significantly increased chat and overall online interest in the title within pirate networks," Antonellis said. "Whenever those factors come together, it makes our challenges from an anti-piracy perspective much harder."
http://www.latimes.com/business/la-f...127,full.story






MPAA Planning Site to Offer Legit Movie Links
Jacqui Cheng

The Motion Picture Association of America has tried any number of tactics to fight piracy, but its latest scheme might actually prove useful to movie consumers on the Internet. The group is supposedly working on a new website that will offer information on how to find legit sources of movies so that users won't have to resort to copyright infringement.

The site, which does not yet have a name, would allow users to search for film titles, and in return it would provide links to places to buy movie tickets, to locations where searchers could buy or rent a DVD, or to sites where they can buy or rent a download from an online source. All of the major movie studios are behind the initiative, an anonymous movie studio source told Variety, and all legit "partners" would be linked on the site. Assuming this information is accurate, it could include links to Fandango, Movietickets.com, Amazon, Netflix, iTunes, Xbox Live Video, Hulu, and more. The site will be not-for-profit (except, of course, that it will be pointing to a million places that sell/rent movies for profit).

The rationale for the venture was allegedly provided by research from the studios that found that many users have a hard time differentiating between legal and illegal content online. While some of us may scoff at such an assumption—it's not exactly difficult for tech-savvy users to know the difference between downloading a movie from iTunes versus BitTorrent—such a confusion does sometimes come up among your average Joes and Janes. Just casually chatting with several of my own family members shows that they haven't the foggiest idea of where to start looking for legal music and video content outside of "the Google," which has sometimes in the past pointed them directly to not-so-legit content. Having a one-stop shop could definitely help in this case, especially if it doesn't discriminate between various online stores and merely provides a comprehensive listing for each film. Hell, throw in a column to list the price and even I would use it.

An MPAA spokesperson declined to comment on the website, but said that the organization is always looking for new ways to help users find legal alternatives. Of course, most of the MPAA's past efforts to "help users" have not exactly revolved around making things easier for anyone; they have instead included legal attacks on P2P sites, pushing for Internet filtering on college campuses, trying to stop DVRs from recording movies, and paying $15,000 for the private e-mail addresses of TorrentSpy users. But, if this initiative turns out being as simple and straightforward as it sounds, and if it gains enough popularity to be widely used, then it could actually offer something of value to consumers.
http://arstechnica.com/news.ars/post...vie-links.html





MPAA Legal Movie Download Site a Wasted Effort | DRM & Over-Pricing Needs to Be Addressed
Dave Parrack

The MPAA has had a slight change of focus and now wants to educate instead of irritate with a central website to help people find legal downloads, but is it doomed to fail?

This is an attempt to draw people away from the piracy realm. While this seems like a step in the right direction the issues of excessive DRM and over-pricing will likely make it an ineffective strategy. People will continue to be drawn to piracy when it offers a better service than the legal alternative.

The MPAA (Motion Picture Association of America) is the organization charged with protecting the rights of movie studios in the US, and seeing as that’s where Hollywood is, that’s a pretty large chunk of the worldwide movie industry.

Fight Or Promote?

Since the emergence of the Internet as a viable source for obtaining copies of movies, a large part of the MPAA’s fight has been online, promoting legal sources of movie downloads, while trying to inhibit illegal sources.

Attack on illegal sources such as torrents and peer-to-peer clients has included legal shut-downs, filtering college campuses, and that whole sorry TorrentSpy mess.

Now, rather than going after what it deems the bad guys, the MPAA has decided to instead focus on promoting the legal destinations for movie downloads. To that end, it is in the process of setting up a one stop shop for legal sources such as Amazon, Netflix, Apple iTunes, and others.

Directory Website

According to Variety the as-yet unnamed website will work as a kind of directory, with links to external sources allowing consumers to purchase cinema tickets, buy or rent DVDs, and download copies of the movie to their PC. This is a bit like what LocateTV.com is already doing.

All of the major studios are thought to be behind the initiative, which is being done in an effort to those people who can’t quite determine legal and illegal sources for movies on the Web.

While you may be thinking that those people surely don’t exist, there are more people venturing online now than ever before, and not all of them will be au fait with the actual difference between BitTorrent and iTunes.

In fact there are a lot of paid torrent and movie download services which provide pirated versions of movies, and the less tech savvy among us would not be able to tell if the content is pirated or not, especially when these paid sites claim to be legal.

A Noble Cause… At Last

This is the kind of thing the MPAA should have been doing a long time ago, working with new technology to rise up to consumer demand, rather than trying to fight it.

While I think piracy will always exist, and there will always be an illegal trade in movies, and TV content, the more legitimate destinations there are on the Web, the less chance there is of it becoming an out of control problem.

A Wasted Effort?

Unfortunately with legal video downloads coming with more DRM and more restrictions than a VCR, as well as having higher costs than renting or buying a tangible DVD, the TV and movie industry is still way off meeting consumer demands.

So while this is a step in the right direction its a pointless step if these other issues are not addressed.
http://www.webtvwire.com/one-stop-sh...etflix-itunes/






MPAA Sues Sites for Fueling Piracy

FOMDB.com, MovieRumor.com included in suit
William Triplett

Acting on behalf of the major studios, the Motion Picture Assn. of America has filed legal action in federal court in Los Angeles against FOMDB.com and MovieRumor.com for allegedly helping online pirates access bootlegged movies and TV shows.

"These sites contribute to and profit from massive copyright infringement by identifying, posting, organizing and indexing links to infringing content found on the Internet that consumers can then view on demand," the MPAA said Tuesday.

Since both sites take advertising, MPAA lawyers argued that the sites employ business models that seek profit through encouraging users — an estimated 27,000 unique visitors per month, combined — to violate copyright protection.

"There are many people operating illegal websites like these who are profiting from the theft of protected content," said John Malcolm, MPAA exec VP and director of worldwide anti-piracy ops, in a statement. "We have filed several other similar lawsuits and will continue to do so in order to hold operators accountable for their illegal activities. We have every intention of shutting down these, and sites like them, for good."

Neither website responded to a request for comment.
http://www.variety.com/article/VR111...goryid=22&cs=1





RIAA Critic Beckerman Scores Judiciary's Ear
David Kravets

New York attorney Ray Beckerman, an outspoken critic of the Recording Industry Association of America, has acquired the ear of thousands of federal judges nationwide.

The American Bar Association's "Judge's Journal" summer issue is publishing his lengthy paper, Large Recording Companies v. The Defenseless (.pdf). The publisher of the blog, Recording Industry vs The People, does an excellent job of explaining the finer legal points of the RIAA's litigation machine.

Beckerman, who defends people sued by the RIAA, chronicles RIAA litigation start to finish -- from the investigative stage, to how the RIAA acquires the name of the ISP account holder to the payment of a few thousand dollars that usually settles a lawsuit out of court.

The bulk of the article deals in highly legal matters concerning venue, jurisdiction, dismissal, discovery, confidentiality, legal fees and default judgments. It's a must read for anybody who has ever been on a file sharing networks like Kazaa, and a must read about an area of litigation that has ensnared more than 20,000 defendants.
http://blog.wired.com/27bstroke6/200...ritic-bec.html





Tenise Barker Takes On RIAA Damages Theory
NewYorkCountryLawyer

Tenise Barker, the young social worker from the Bronx who took on the RIAA’s “making available” theory and won, has now launched a challenge to the constitutionality of the RIAA’s damages theory. In her answer to the RIAA’s amended complaint, she argues that recovering from 2,142 to 428,571 times the actual damages would be a violation of Due Process. She says that the Court could avoid having to find the statute unconstitutional by construing the RIAA’s complaint as alleging a single copyright infringement — the use of an “online media distribution system” — and limiting the total recovery to $750. In the alternative, she argues, if the Court feels it cannot avoid the question, it should simply limit the plaintiffs’ damages to $3.50 per song file, since awarding more — against a single noncommercial user, for a single upload or download of an MP3 file for personal use — would be unconstitutional.
http://yro.slashdot.org/article.pl?sid=08/07/28/1658212





New RIAA Lawsuit Defense Tactic: Admit Liability, Challenge the Law
David Kravets

Here's a unique defense to a Recording Industry Association of America file sharing lawsuit: Admit liability and challenge the law under which you're being sued.

That's what a Bronx woman did Monday in New York federal court. Denise Barker is accused of file sharing eight songs on the Kazaa network in 2004. If found liable, she faces fines under the Copyright Act of $750 to $150,000 per song.

Barker's attorney, Ray Beckerman, admitted the woman file shared and challenged the constitutionality of the Copyright Act, the law under which the RIAA sued Barker and thousands of others. The fines the act authorizes for each download is unconstitutionally excessive and against U.S. Supreme Court precedent, Beckerman said.

Beckerman, who writes the Recording Industry vs The People blog, estimated its costs the industry $3.50 per download, meaning the penalties could exceed thousands of times the actual injury to the industry. Rulings by the U.S. Supreme Court and other courts say financial punishments exceeding a 9-to-1 ratio are unconstitutional.

"It's an ideal case to litigate the damages issue. She actually did make some copies through Kazaa," Beckerman said in a telephone interview.

The RIAA has sued more than 20,000 individuals for illegal file sharing. Most of the accused settle out of court for a few thousand dollars.

Only one case has gone to trial.

In that case, A Duluth, Minnesota jury last year ordered Jammie Thomas to pay $222,000 for file sharing 24 songs on Kazaa. She denied her guilt and challenged the constitutionality of the Copyright Act after she was found liable in October.

The Bush administration weighed-in, urging Judge Michael Davis to uphold the penalty.

A hearing in Thomas' case was set for Monday, where the arguments instead are expected to focus on the so-called "making available" argument.

The RIAA claims that file sharers are liable for infringement solely for making available copyrighted works of music on peer- to-peer file sharing networks. Among the reasons the RIAA makes such an argument is because it's technologically impossible to know if a file sharer's music has been downloaded by somebody who has not been authorized to copy it.

The judge in the Thomas case is considering ordering a new trial. He's concerned that he erred when he instructed jurors in October that the "making available" argument amounted to unauthorized distribution.
http://blog.wired.com/27bstroke6/200...aa-lawsui.html






Italian Media Company Sues YouTube
Dawn Kawamoto

Italian media company Mediaset announced on Wednesday that it has filed a lawsuit against YouTube and owner Google, alleging that the video-sharing site distributed and exploited its commercial property.

Mediaset alleges that it found at least 4,643 copies of its programming on YouTube on June 10, when it conducted a sample survey. That programming represents approximately 325 hours of material, Mediaset claims.

The media company, as a result, alleges that its three Italian television networks have lost nearly 315,700 viewer days, which, in turn, represents lost advertising opportunities for its television programs, Mediaset alleges.

Mediaset is seeking damages of at least 500 million euros ($779 million).

Google and Mediaset were not immediately available for comment.

YouTube, however, issued a statement, according to a Reuters report:

YouTube respects copyright holders and takes copyright issues very seriously.

There is no need for legal action and all the associated costs.

In the United States, the issue of viewers bearing liability for watching copyrighted material posted to YouTube has also been raised, as noted in a blog by Surveillance State's Chris Soghoian.

In the case of Mediaset, the allegations could potentially create more of a rift than a garden-variety copyright infringement case.

Italian Prime Minister Silvio Berlusconi controls Mediaset, according to a Bloomberg report.
http://news.cnet.com/8301-1023_3-10002413-93.html





IFPI, Italian Police Take Down "Italian Pirate Bay"
Jacqui Cheng

A popular torrent tracker in Italy closed up shop today, handing the international music trade group IFPI another victory against P2P. Colombo-BT.org now points to a page that says, "Access denied in execution of an Italian Court Authority injunction." The shutdown came after action was taken by the Guardia di Finanza, an Italian police force that operates under the Italian Armed Forces. Unsurprisingly, the IFPI applauded the move and took it as a sign of progress against piracy online.

The Guardia di Finanza was able to take action by working in conjunction with the FPM, an Italian antipiracy group that is, in turn, affiliated with the IFPI. Police froze two bank accounts in connection with the site and seized several computers. The three men who ran Colombo-BT were charged with copyright infringement and now face up to three years in prison, along with "heavy financial penalties through administrative actions," says IFPI.

According to the group, the Italian BitTorrent site made more than 390,000 music files and 500,000 movies available, some of which were pre-release titles. The site apparently had 800,000 unique visitors per month and almost half a million registered users. Those who ran the site allegedly made money by accepting donations.

"Colombo-BT.org was Italy's version of The Pirate Bay. Its operators deliberately facilitated availability of copyright infringing content to line their own pockets," FPM president Enzo Mazza said in a statement. "The gang of three now face potential prison sentences and hefty fines as a result of their activities. This police action sends a strong message that Italy will not tolerate serious online music piracy, so criminals looking for get rich quick schemes should consider other options."

This isn't the first torrent tracker that the IFPI has taken down; in fact, the IFPI has enjoyed a fair bit of success in fighting illegal file-sharing in Europe. Last year, the IFPI announced the arrest of a UK man who was selling vouchers for Russian MP3 site AllofMP3. In October, the IFPI and BPI (a UK music trade group) worked with police to shut down another popular BitTorrent tracker called OiNK. And, in April of this year, the IFPI helped Czech police shut down a 4TB file server that was known for its pre-release music archives and was housed at the Czech Academy of Sciences.

The only site that the IFPI can't seem to take down is The Pirate Bay, based in Sweden. Law enforcement has been trying to take down the most popular torrent tracker for years with little success. Even after having been raided by Swedish police in 2006, things are still up and running and membership is stronger than ever. Now, an investigator controversy could taint law enforcement's case against The Pirate Bay.

Still, IFPI seems happy to shut down other major P2P sites in the meantime,with the goal of making such trackers hard enough to find and use that ordinary people find it isn't worth the hassle. Due to differences in laws (and to judicial hostility toward forcing ISPs to turn over user data), Europe has seen fewer court cases against individuals and casual users, but plenty of action against the major trackers.
http://arstechnica.com/news.ars/post...t-tracker.html





Mexican Authorities Shut Down File-Sharing Server
Ayala Ben-Yehuda

Mexican authorities have shut down a file-sharing server that enabled the exchange of music and videogames online via DirectConnect, a worldwide peer-to-peer network that has been the subject of IFPI lawsuits and international police raids.

The Mexican server was a hub of DirectConnect known as "Sunnydale," and contained "more than 1.5 terabytes of illegal content, including local and international music repertoire," according to an IFPI statement.

Using information supplied by local anti-piracy trade group APCM via an Internet search, the Mexican attorney general's office asked the hub's internet service provider to shut down Sunnydale's connection. The server has shown no signs of activity since July 3.

IFPI Latin America helped shut down a DirectConnect hub in Chile in March, which was identified as having enough capacity to host up to 1.8 million songs.
http://www.billboard.biz/bbbiz/conte...3a092c8e4a6f33





Two OiNK Uploaders Go Free
Ernesto

Yesterday we reported that the bail date for OiNK administrator Alan Ellis and the six arrested OiNK uploaders was extended again. New information, however, now shows that two of the six uploaders were released from further investigation and can get on with their lives.

While hundreds and thousands of filesharers in the UK receive a warning letter from their ISP this week asking them nicely to stop sharing copyrighted files, six members of the OiNK tracker have been waiting anxiously for the results of a criminal investigation.

There is some good news though, as two of the six - a 19 year old man and a 28 year old women - wont face any further charges, and now go free. For the other four, and Alan Ellis himself, the wait continues. Alan told TorrentFreak that his new bail date is set for September 10th.

Thus far, the police have not replied to our inquiries so it remains unclear why two of the six uploaders have been released from any charges. The uploaders were arrested by detectives involved with ‘Operation Ark Royal’ this May, on suspicion of “Conspiracy to Defraud the Music Industry” and other copyright offenses. No further arrests have been made since then.

OiNK was one of the largest private BitTorrent trackers, hosting hundreds and thousands of torrents. The site was shut down in a joint effort by Dutch and British law enforcement in October 2007, based on inaccurate intel from the IFPI and the BPI, two well known anti-piracy organizations.
http://torrentfreak.com/two-oink-upl...o-free-080729/





Public Left Out of Anti-Counterfeiting Trade Talks
Michael Geist

Prime Minister Stephen Harper and the leaders of G8 countries closed their recent summit in Hokkaido, Japan by encouraging "the acceleration of negotiations to establish a new international legal framework, the Anti-Counterfeiting Trade Agreement (ACTA), and seek to complete the negotiation by the end of this year." The decision to fast-track the controversial ACTA has led to new momentum for the still-secret treaty as the Australian government recently disclosed that a new round of negotiations will commence this week.

The ACTA attracted considerable attention earlier this year after leaked documents revealed the treaty could result in broad new surveillance requirements on Internet service providers as well as new powers for border guards cracking down on allegedly infringing activities. In fact, the concern grew so loud that Industry Minister Jim Prentice sought to assure Canadians that his recent legislative proposals would not result iPod searches at the border.

What Prentice did not reveal is that officials have been developing plans to establish an "insider" group comprised solely of government departments and industry lobby groups that would be provided with special access to treaty documentation and discussion.

According to documents obtained under the Access to Information Act and reported here for the first time, the government has been crafting an Intellectual Property and Trade Advisory Group. The initial plans for membership in the group were limited exclusively to 12 government departments and 14 industry lobby groups. These include the Canadian Recording Industry Association, the Canadian Motion Picture and Distributors Association, and the Entertainment Software Association of Canada.

The early membership lists omit several key industry representatives likely to be affected by ACTA, including telecommunications, technology, and Internet companies. Moreover, there is absolutely no representation of the public interest — no privacy representation despite the obvious privacy implications of the treaty (the Office of the Privacy Commissioner of Canada was not included on the government invitee list), no consumer representation despite the effects on consumer interests, and no civil liberties representation on a treaty that could fundamentally alter Canadian civil rights.

The government documents indicate that members would engage in "in-depth exchanges on technical negotiating issues" and therefore be required to sign confidentiality agreements in order to participate.

The decision to create a two-track approach for ACTA consultations appears to have been deliberate. The same documents discuss the prospect a public track that would include a general public consultation (which was held in April) along with the insider group that would be privy to treaty information.

The secretive Canadian approach stands in marked contrast to other countries. Australia has already launched two public consultations on the treaty — one to consider entry into the negotiations and the second to discuss substantive positions. Canadian groups tracking ACTA have been forced to rely on Australian documents to glean some insight into the treaty process.

Even the public consultative processes have been more transparent outside Canada. The United States Trade Representative, which managed the U.S. public consultation, has publicly posted copies of all responses it received to its consultation. Canadian officials have not provided any feedback on the results of its consultation nor any indication if they plan to disclose the responses they received.

Moreover, both U.S. and European Union officials have held open meetings with a broad range of groups to shed further light on the ACTA. There have been no similar meetings in Canada.

With Canadian law enforcement agencies increasing their efforts to address counterfeiting activities — the RCMP recently shut down a major Ontario counterfeiting operation and a British Columbia court just awarded record damages against a distributor of counterfeiting products — there is a growing sense that Canada already has laws sufficient to address counterfeiting concerns.

Few would challenge the need to combat counterfeiting, yet secretive, fast-track negotiations and insider consultations do little to inspire public confidence.
http://www.thestar.com/Business/article/468267





Wikileaks Releases ACTA Negotiations As "0-Day"

An anonymous reader writes

"Wikileaks has released a new document about the ACTA negotiations occurring in Washington over the next three days. This might be the shortest time between authorship of a document and its publication on Wikileaks so far. The brief 3-page memo, dated today, could add quite a bit of oil to the fire of the ACTA debate. It is titled Business Perspectives on Border Measures and Civil Enforcement and it contains a set of proposals to the 'ACTA negotiators' issued by 'Concerned business groups operating in ACTA nations.' Among many highly invasive methods and approaches proposed in this memorandum, the reader can find detailed demands for: full disclosure of relevant information by Customs to trademark holders so that they can mount private investigations; disclosure of identities and other information about copyright infringers; and increased inspection of goods. This document is especially important to raise public awareness on these negotiations and their implications for the future."
http://news.slashdot.org/news/08/07/29/198229.shtml





Time to Drop Cable Television? Not So Fast
Kenneth Li

Couch potatoes love television, but some simply have no interest in watching sports or kids shows. So why should they pay for it?

More U.S. TV watchers are asking the same question as cable and satellite TV bills creep higher. The government wants to know why consumers can't just pay for the channels they want and many technology and media companies are dreaming up new alternatives for delivering only the TV programs viewers want.

A fresh batch of options from Sony Corp (6758.T: Quote, Profile, Research, Stock Buzz) and Amazon.com Inc (AMZN.O: Quote, Profile, Research, Stock Buzz), Netflix Inc (NFLX.O: Quote, Profile, Research, Stock Buzz) and Roku, as well as Microsoft Corp's (MSFT.O: Quote, Profile, Research, Stock Buzz) video game console Xbox 360 launched over the past few weeks promise to do away with cable all together.

The latest push into the living room aims to solve what has stymied earlier products, including the complexity of hooking up these devices, lack of content and relatively high prices, with some devices costing well past $500.

About 8 million Netflix customers, accustomed to renting DVDs by mail, can now purchase a $99 set top box from Roku and watch some 12,000 films and shows on television for no additional fees.

Sony Bravia TV owners who buy a $300 device that connects to the back of TVs and to the Internet can already watch YouTube videos. Soon, Bravia customers will be able to order from Amazon movies and shows streamed directly to TVs.

But even the experts don't think cable will be replaced anytime soon and point to a string of high profile failures, including Walt Disney Co-backed (DIS.N: Quote, Profile, Research, Stock Buzz) MovieBeam and privately held Akimbo.

"The content deals are starting to come together, but the library is still pretty narrow," said Mark Kirstein of Scottsdale, Arizona-based market research firm MultiMedia Intelligence.

A general aversion to yet another gadget in the living room and the high prices are other reasons why the idea has failed to catch on. Premium channels such as Time Warner Inc's (TWX.N: Quote, Profile, Research, Stock Buzz) popular HBO are also unavailable on the Internet to non-subscribers, except through iTunes, where some programs are sold.

But that has not stopped the tech industry from buzzing again after a number of new products that address some of these issues were unveiled in quick succession.

Ubiquity, Simplicity

A new set-top box born out of a partnership between DVD rental business Netflix Inc and device maker Roku, in which Netflix owns a minority stake, is emerging as a leading candidate for consumer appeal, Forrester Research analyst James McQuivey said.

"Despite its relatively meager content, the Netflix Player by Roku is a solid winner, overcoming the barriers that hamper the rest," McQuivey said.

Unlike others that came before it, Roku is counting on offering services beyond Netflix, said Tim Twerdahl, vice president of consumer products at Roku.

"Our vision is to open up the box," he said.

Prepare to find free, advertising-supported video services, pay-per-view services and YouTube-like user generated videos.

Netflix is also planning to let current subscribers find its movies online in as many ways as possible. It struck a deal with Microsoft to allow subscribers to the video game console Xbox 360's online service to also watch streamed Netflix movies.

Earlier, Netflix said it would offer its Internet service on an LG Electronics Inc (066570.KS: Quote, Profile, Research, Stock Buzz)-manufactured set-top box.

"It's too early to tell who is going to prevail," Netflix spokesman Steve Swasey said.

Tech industry watchers say the current crop represent the first wave of products that have shown any real promise. Importantly, many are backed by financiers with deep pockets.

But will it matter? Apple Inc's (AAPL.O: Quote, Profile, Research, Stock Buzz) AppleTV has yet to light up the industry the way its iPod and iTunes service transformed the music business, critics point out.

Then there's Hollywood, which has been reluctant to offer more new releases on the Internet for fear of jeopardizing DVD sales that account for more than half its profits.

"They're going to fight amongst each other for a teeny-tiny part of the market," McQuivey said. "If you have cable service and a DVD player, you already have a much better solution than any of these boxes can provide you."

Sony is tackling the problem in yet another way by appealing to its own movie studio to release its films ahead of the DVD release. It plans to offer Sony Pictures's "Hancock" later this year for Bravia TV owners.

For now, "this is a Sony initiative. It's something that can be realized with other studios," said Sony Electronics's senior manager of business development Robert Jacobs.

(Editing by Andre Grenon)
http://www.reuters.com/article/techn...29877920080725





Earnings Rose 12% for Verizon in Quarter
Laura M. Holson

Verizon Communications is having a harder time pushing its television service, which competes with the big cable companies, but the company said the slowing economy had not hurt its cellphone business.

In releasing its earnings report on Monday, Verizon said it added 1.5 million new wireless customers, the same number as last quarter. It was 25 percent fewer than the two million it added in the fourth quarter of 2007, but Verizon Wireless, which is a joint venture with Vodafone, said its churn rate — the pace at which customers defect to other carriers — fell to 1.1 percent from 1.2 percent in the previous quarter. By comparison, Sprint Nextel has a churn rate of 2.45 percent.

Analysts, however, were concerned about the pace at which Verizon was winning customers for its fiber optic delivery of television programming, called FiOS TV. Verizon added 176,000 customers in the last three months, compared with 263,000 customers in its first quarter. In addition, the company said it added 187,000 FiOS Internet customers.

“That FiOS is already seeing a sequential deceleration is a startling development,” a communications analyst at Sanford C. Bernstein & Company, Craig Moffett, wrote in a research report.

Dennis F. Strigl, Verizon’s president, was puzzled by analysts’ questioning of Verizon’s FiOS results.

“I’m not sure where the concern is coming from,” Mr. Strigl said in an interview after the company reported its second-quarter results.

He said it cost Verizon less to acquire FiOS television customers in the second quarter than it did six months ago because the company had been offering new customers a free 19-inch high-definition television, which cost the company $200 each. (The televisions were an incentive only in the first quarter.)

Verizon began offering the FiOS service, which the company hopes will compete with the major cable companies, in New York City on Monday. But as the slower adoption rates show, Verizon is entering a hotly competitive market where customers are as jealously guarded as a seat on a crowded subway.

Verizon sued Time Warner Cable earlier this year, saying some of its rival’s commercials included false and misleading statements. And Verizon has sparred with Comcast and Time Warner over marketing techniques that Verizon was using to retain customers who wanted to switch to a competitor.

In June, the Federal Communications Commission said Verizon could not talk customers out of switching to another phone service provider while waiting for their phone numbers to be transferred, a victory for Comcast and Time Warner Cable, which filed a complaint in February.

“It’s a natural phenomenon,” Mr. Strigl said of the aggressive customer tactics. “It happened in the early days of the wireless business.”

Verizon reported second-quarter net income of $1.88 billion, or 66 cents a share, a 12 percent increase compared with profit of $1.68 billion, or 58 cents a share, in the second quarter of last year. Revenue increased slightly to $24.1 billion, from $23.3 billion a year ago. Mr. Strigl said he was pleased with the results.

Verizon, like AT&T, Sprint Nextel and T-Mobile, sees data as the growth engine of its wireless business.

Mr. Strigl said more than 30 percent of the mobile devices Verizon is selling have access to the Internet, and also receive and send e-mail and text messages. By contrast, he said, “a year ago it was half that.”

Verizon’s expansion efforts could be thwarted if union-represented employees walk out when their contract expires on Aug. 2. (They voted last week to authorize a strike.) Verizon executives said they were confident that a resolution would be reached.

Mr. Strigl conceded that there was one area that had disappointed Verizon. The company lost 133,000 customers for its D.S.L. Internet service, which uses phone lines.

The loss had nothing to do with the flagging economy, he said. Many analysts have feared that customers tend to drop costly services when personal budgets need to be trimmed. Mr. Strigl attributed the loss to some customers switching to FiOS, while others defected to competitors.

Verizon also lost 920,000 residential and business telephone lines — they now tally 38.3 million — a decline of 8.5 percent year over year. The drop was steeper among residential customers, an 11.4 percent drop compared with the same period a year ago.
http://www.nytimes.com/2008/07/29/bu...29verizon.html





Comcast Profit Rises 8 Percent
AP

Comcast Corp. said Wednesday its second-quarter profit rose 8 percent as cable TV rates rose and consumers ordered more digital and premium services.

But that was still shy of Wall Street's forecast. The second quarter is traditionally slower for the company because snowbirds and students disconnect their cable for the summer.

Philadelphia-based Comcast posted second-quarter net income of $632 million, or 21 cents per share, compared with $588 million, or 19 cents per share, in the quarter a year earlier.

Revenue rose 11 percent to $8.55 billion.

Analysts polled by Thomson Financial were expecting, on average, slightly higher profit of 23 cents per share on revenue of $8.54 billion.

Operating cash flow was up 8 percent to $3.36 billion. But free cash flow more than tripled to $1.16 billion in the quarter, after Comcast cut its capital expenditures by 20 percent.

The company said its spending on wiring new communities has fallen 50 percent in the housing slump. Last year, the company also spent money meeting the federal July 1 deadline that required cable operators to start using new boxes with separable security.

Comcast lost 138,000 basic subscribers in the quarter but added 320,000 digital customers. Total video revenue was up 3 percent to $4.73 billion. Video customers on average paid $63.98 a month, up 4 percent.

High-speed Internet added 278,000 new subscribers, down 18 percent from 2007. Revenue was up, however, by 10 percent to $1.8 billion. Customers on average paid $42.01 a month, down 3 percent.

Digital voice added 555,000 net new customers, down 20 percent from a year ago, but revenue also was up 77 percent to $636 million. Customers paid $39.48 a month on average, down 7 percent.

Comcast also reaffirmed its previous guidance for an 8 percent to 10 percent increase in revenue and operating cash flow for 2008. It also expects free cash flow to increase 20 percent or more.
http://www.nytimes.com/aponline/busi...s-Comcast.html





Broadband Said to Hit 77% of US Households by 2012
Brad Reed

The United States will close its digital divide significantly within the next four years, with 77% of U.S. households having a broadband Internet subscription, according to a new Gartner study.

Just over half of U.S. households currently subscribe to broadband Internet services, but Gartner predicts that that percentage will grow by more than 20 points by 2012. Amanda Sabia, a Gartner principal research analyst, says one of the biggest factors in the spread of broadband will be the advent of such 4G wireless services as WiMAX and Long Term Evolution that are expected to be launched in various markets over the next four years.

Worldwide, 17 countries will have broadband penetration rates of 60% or more by 2012, up from five countries in 2007, Gartner says. South Korea, which currently has the highest rate of broadband penetration in the world, at 93% of households, will retain its lead as the most-connected country in the world, with 97% of households having a broadband subscription.

With a projected 77% household penetration rate, the United States will be tied with Japan for the fifth-highest broadband-penetration rate in the world, trailing only South Korea (97%), the Netherlands (82%), Hong King (81%) and Canada (79%). "Depending on the specific market conditions, availability of Internet-enabled devices and the continued impact of broadband on consumer lifestyles, we expect some markets will have a broadband ceiling at 80% penetration or greater," Sabia says.

As broadband becomes more ubiquitous, ISPs will concentrate less on building out their networks to reach new customers and more on expanding what customers can do with their broadband Internet connections, Sabia says. In particular, ISPs will focus on delivering entertainment applications, such as Internet video content and games, as well as IPTV content and home networking applications, she says.

The digital divide between urban and rural areas in the United States has been a hot topic among both politicians and ISPs. Because many ISPs have stated consistently that there isn't enough money to be made that would justify expanding their broadband networks to large areas with low population density, many in government have suggested subsidizing rural broadband in the United States. A recent report issued by content-delivery-network provider Akamai Technologies found that significant disparities remain between urban and rural areas in broadband-connectivity delivery, despite a relatively high number of broadband connections nationwide.

In particular, the report found that most of the states with the highest percentages of 5Mbps connections are East Coast states that have large urban areas. Delaware has the highest percentage of 5Mbps connections at 60%, followed by Rhode Island (42%) and New York (36%). Seven states have broadband-connection rates of less than 10%, with Hawaii having the lowest percentage at 2.4%, the report shows.
http://www.pcworld.com/article/14897...broadband.html





Does Your House Need a Tail? Sizing Up Customer-Owned Fiber
Timothy B. Lee

The really long tail

Last month, construction was completed on a pilot project that ran fiber optic cables to 400 homes in Ottawa. Stringing fiber optic cables isn't a big deal by itself—Verizon has been running fiber to millions of homes in the US—but the Ottawa project comes with a twist: rather than providing Internet access for a monthly fee, the company plans to sell the fiber strands outright to individual homeowners.

This isn't how we're used to doing telecommunications infrastructure. Traditionally, a "last mile" copper loop, coax cable, or fiber strand has been owned by an incumbent telephone or cable company, and the customer has paid a monthly fee for telecom services. But, if the Ottawa experiment is a success, that could change.

In the future, it could become commonplace for homes to come with "tails." These customer-owned, fiber-optic connections would link them to a network peering point. Without the expense of rolling out last mile infrastructure to every home, many more ISPs could afford to serve a given neighborhood by running wiring to the peering point, leading to more competition and lower prices. Perhaps best of all, the growth of customer-owned fiber could make debates over "open access" and network neutrality moot, as robust telecom competition should prevent the worst of the monopolistic behavior exhibited by telco and cable incumbents.

It's a tantalizing prospect, but a lot of practical difficulties will have to be overcome to make it a reality. Incumbent telecom firms may not like the prospect of increased competition, and they've never been shy about using regulatory barriers to strangle potential competitors in red tape. Meanwhile, promoters of the concept face a kind of chicken-and-egg problem: a customer-owned fiber strand is only useful if there is robust competition among ISPs at the other end, but companies aren't going to enter the residential ISP market until there's a critical mass of customer-owned fiber.

Most importantly, it's not yet clear how the economics will work. The Ottawa trial suggests that a fiber connection can cost less than $3000 per household, but the exact cost depends heavily on site geography and the rate of customer uptake. It will take several years for the concept to prove itself. And, if it does, it will take a number of additional years for it to be widely adopted.

Confronting the "last mile" problem

In the quarter century since the breakup of Ma Bell, policymakers have struggled with the "last mile" problem. Competition is good for consumers and for innovation, but rolling out redundant copper, fiber, or coax lines is wasteful—especially in dense urban areas where it requires ripping up busy streets. In the late 1990s, the FCC attempted to deal with this problem with a strategy called "open access," which forced incumbent telephone companies to "share" their infrastructure at rates dictated by the federal government.

The effort wasn't exactly a rousing success. Competitors accused the Baby Bells of foot-dragging and obstructionism. The Baby Bells, in turn, complained bitterly that the prices set by the FCC were too low to recover their costs. They also noted that they had little incentive to invest in infrastructure upgrades because any new infrastructure would have had to be shared with competitors.

After years of litigation and regulatory uncertainty, in 2005 the Supreme Court confirmed that cable incumbents were not subject to open-access rules. Soon afterwards, the FCC threw in the towel on open access for the Baby Bells as well. The result was the now-familiar duopoly: most American consumers can now get broadband service from their local phone company or their local cable company, but that's it.

The new arrangement is an undeniable improvement over the old Bell monopoly, but it still has plenty of problems. In his landmark paper that coined the phrase "network neutrality," Tim Wu positioned network neutrality regulations as a better strategy for achieving the goals of open access regulation. As it became clear that the open access model was failing, some activists shifted their focus to demanding the passage of "network neutrality" regulation.

But network neutrality regulation has proven no less controversial. Critics, including me, warn of the dangers of putting the Internet under the control of the political process. Just as uncertainties in the 1996 Telecom Act led to almost a decade of costly litigation, so too could the vagueness of network neutrality regulation could lead to a decade of litigation and the investment-stifling uncertainty that comes with it. Moreover, there are plenty of historical examples of regulatory schemes with unintended consequences. Most famously, the Interstate Commerce Commission, the nation's first modern regulatory agency, did more to protect the railroads from competition than to protect consumers from the railroads. There is a real danger that incumbent broadband providers could find ways to manipulate network neutrality regulations to their advantage, just as the railroads did a century ago.

The result has been a broadband policy stalemate. Congress considered, but failed to pass, network neutrality regulation in 2006. Since taking control of Congress, the Democratic majority has shown no interest in reviving the proposal. Proponents of regulation have touted pledges from every Democratic Senate challenger to support regulation, but the prospects for action in the next Congress remain cloudy. It wouldn't be the first time that the telcos have derailed legislation they didn't like.

Customer-owned fiber

Customer-owned fiber may offer a way out of this regulatory morass. It's hard to believe today but, as Google's Derek Slater points out, there was a time when the phone company owned the entire telephone network, including the wires inside our homes and the phone on our desks. Shifting the demarcation point to the outside of our homes created a vibrant market for customer premises equipment: not just telephones, but modems, fax machines, answering machines, and other specialized gear. With customer-owned fiber, the demarcation point would be shifted even further from the customer. That would once again mean more responsibility for the customer, but with offsetting benefits that could flow from greater competition.

Slater is working with Tim Wu on a forthcoming paper that discusses the customer-owned fiber model. Under their proposal, each customer would pay the up-front costs of stringing fiber to her own home. The fiber would terminate at a carrier-neutral colocation facility, where a variety of ISPs would have a presence. Because customers, rather than any given ISP, would own the "last mile" to the customer's house, many more ISPs could afford to compete on an equal footing for customers' business.
http://arstechnica.com/articles/cult...wned-fiber.ars





Who Should Solve This Internet Crisis?
Robert M. McDowell

The Internet was in crisis. Its electronic "pipes" were clogged with new bandwidth-hogging software. Engineers faced a choice: Allow the Net to succumb to fatal gridlock or find a solution.

The year was 1987. About 35,000 people, mainly academics and some government employees, used the Internet.

This story, of course, had a happy ending. The loosely knit Internet engineering community rallied to improve an automated data "traffic cop" that prioritized applications and content needing "real time" delivery over those that would not suffer from delay. Their efforts unclogged the Internet and laid the foundation for what has become the greatest deregulatory success story of all time.

The Internet has since weathered several such crises. Each time, engineers, academics, software developers, Web infrastructure builders and others have worked together to fix the problems. Over the years, some groups have become more formalized -- such as the Internet Society, the Internet Engineering Task Force and the Internet Architecture Board. They have remained largely self-governing, self-funded and nonprofit, with volunteers acting on their own and not on behalf of their employers. No government owns or regulates them.

The Internet has flourished because it has operated under the principle that engineers, not politicians or bureaucrats, should solve engineering problems.

Today, a new challenge is upon us. Pipes are filling rapidly with "peer-to-peer" ("P2P") file-sharing applications that crowd out other content and slow speeds for millions. Just as Napster produced an explosion of shared (largely pirated) music files in 1999, today's P2P applications allow consumers to share movies. P2P providers store movies on users' home and office computers to avoid building huge "server farms" of giant computers for this bandwidth-intensive data. When consumers download these videos, they call on thousands of computers across the Web to upload each of their small pieces. As a result, some consumers' "last-mile" connections, especially connections over cable and wireless networks, get clogged. These electronic traffic jams slow the Internet for most consumers, a majority of whom do not use P2P software to watch videos or surf the Web.

At peak times, 5 percent of Internet consumers are using 90 percent of the available bandwidth because of the P2P explosion. This flood of data has created a tyranny by a minority. Slower speeds degrade the quality of the service that consumers have paid for and ultimately diminish America's competitiveness globally.

While we at the Federal Communications Commission are trying to spur more competitive build-out of vital "last mile" facilities, especially fiber and wireless platforms, this congestion will not be resolved merely by building fatter and faster pipes.

Last summer, a new nongovernmental organization, the P4P Working Group, was formed to find a solution. The group has already field-tested dramatically increased delivery speeds of P2P content over cable networks (up 235 percent) and other networks (up 898 percent in some cases). It is working with industry and consumers to create a "P2P Bill of Rights and Responsibilities."

Such dynamic work is progressing without a government mandate or regulatory framework. Soon, however, that could change.

Since the fall, the FCC has been considering allegations filed by public interest groups that cable operator Comcast violated FCC rules by "managing" or "interfering with" the upstream flow of certain P2P video applications, namely those of a company called BitTorrent. The allegations boil down to a suspicion that Comcast was motivated not by a need to manage its network but by a desire to discriminate against BitTorrent for anticompetitive reasons. Comcast maintains that any interference was imperceptible to consumers, occurred in minuscule amounts of time, and was limited to peak congestion periods and areas. Comcast and BitTorrent settled their dispute in March; in fact, they issued a statement saying in part that "these technical issues can be worked out through private business discussions without the need for government intervention."

Despite this settlement, some are calling for the FCC to rule that Comcast's actions were illegal and should be punished. Others contend that the FCC has no enforceable rules that apply to such situations and that the issue should be addressed through a rule-making proceeding, with an opportunity for public comment, or through congressional legislation. We have examined the arguments on both sides and are poised to decide the matter this week. But regardless of what that ruling stipulates, the issue of what constitutes appropriate Internet network management will be debated for some time.

Our Internet economy is the strongest in the world. It got that way not by government fiat but because interested parties worked together toward a common goal. As a worldwide network of networks, the Internet is the ultimate "wiki" environment -- one that we all share, build, pay for and shape. Millions endeavor each day to keep it open and free. Since its early days as a government creation, it has migrated away from government regulation.

If we choose regulation over collaboration, we will be setting a precedent by thrusting politicians and bureaucrats into engineering decisions. Another concern is that as an institution, the FCC is incapable of deciding any issue in the nanoseconds that make up Internet time. And asking government to make these decisions could mean that every few years the ground rules would change based on election results. The Internet might grind to a halt in such a climate. It would certainly die of clogged arteries if network owners had to seek government permission before serving their customers by managing surges of information flow.

A better model would allow collaborative groups to continue to do what they have done for years. If they can't reach an agreement, -- which has never happened -- then government could examine the situation and act accordingly. Sometimes shining sunlight on issues produces amazingly beneficial effects, and the public interest groups that raised the BitTorrent matter should be praised for doing so. Yet before venturing into the unknown, we should remember something President Bill Clinton said in 1997: "Governments should encourage industry self-regulation wherever appropriate and support the efforts of private-sector organizations to . . . facilitate the successful operation of the Internet." What we do, or don't do, will affect tomorrow's networks. Let's stick with what works and encourage collaboration over regulation.
http://www.washingtonpost.com/wp-dyn...072701172.html





AT&T Will Disconnect Wireless P2P Users

AT&T will jettison wireless users that engage in P2P file-sharing over its network, the company said Friday in a letter PDF filed at the FCC (and flagged today by Ted Hearn at Multichannel News). Senior lobbyist Robert Quinn answered a question posed at hearing last week by Republican FCC Commissioner Robert McDowell about the company's policies of managing P2P network traffic on its broadband wireless platform.

Quinn said that AT&T's terms of service (as well as the TOS for most other carriers) bars the use of P2P applications on the wireless platform. "Use of a P2P file sharing application would constitute a material breach of contract for which the user’s service could be terminated," he said.

Because P2P file sharing applications typically engage in continuous (rather than bursty) transmissions at high data rates, a small number of users of P2P file sharing applications served by a particular cell site could severely degrade the service quality enjoyed by all customers served by that site.

AT&T hasn't yet booted anybody off the network for using P2P, Quinn said.

The FCC's McDowell is likely to vote against an order, slated for vote on Friday, that finds Comcast secretly degraded P2P traffic in violation of the agency's network neutrality principles. AT&T's written admission that it won't permit any form of P2P on its broadband wireless network is likely to be used by McDowell in arguing against the order, saying, in essence, that Comcast's supposed transgressions aren't as bad as blocking P2P altogether. (One crucial distinction between the two circumstances: Comcast wasn't "transparent" about its P2P throttling while AT&T is apparently upfront about it in its user agreement).

However, it's all but certain that the order will pass given that FCC Chairman Kevin Martin, a proponent of punishing Comcast, likely has the two other votes needed to succeed, with Democratic Commissioners Michael Copps and Jonathan Adelstein no doubt siding with him on this smatter. Less clear is whether any action by the FCC will stand up on appeal. CNET's Declan McCullagh today joins the growing consensus that the FCC does not have the authority to take this action.
http://www.ipdemocracy.com/archives/..._p2p_users.php





FCC Orders Comcast to Modify Network Management
Peter Kaplan

Comcast Corp (CMCSA.O: Quote, Profile, Research, Stock Buzz) has been ordered to change how it manages its broadband network after U.S. communications regulators concluded some of its tactics unreasonably restrict Internet users who share movies and other material.

In a precedent-setting decision, the five-member Federal Communications Commission voted 3-2 to uphold a complaint accusing Comcast of violating the FCC's open-Internet principles by improperly hindering peer-to-peer traffic.

"Subscribers should be able to go where they want, when they want, and generally use the Internet in any legal means," FCC Chairman Kevin Martin said in a statement.

Comcast said it was disappointed by the decision and was considering all its "legal options."

The ruling by the FCC does not include any fines against Comcast. But it requires the company to cease impeding peer-to-peer applications, to tell the FCC how the practice has been used, and to notify customers about other network management practices it adopts in the future.

The complaint against Comcast was filed by consumer groups who said the company had blocked file-sharing services, such as BitTorrent, that distribute TV shows and movies.

The case has become a flash point for a growing debate over a concept known as "network neutrality," which pits open-Internet advocates against some Internet service providers, who say they need to take reasonable steps to manage ever-growing traffic on their networks for the good of all users.

Return To Sender

Comcast has said its network management practices were a reasonable choice and has argued that the FCC does not have the authority to enforce its open-Internet policy.

Martin likened Comcast's network management to "the post office opening your mail, deciding they didn't want to bother delivering it, and hiding that fact by sending it back to you stamped 'address unknown -- return to sender'."

Martin said the technique ran afoul of the FCC because it was too sweeping and was not disclosed to customers. He said Comcast's justification for using it -- that it is needed to manage network congestion -- did not add up.

Martin said he was especially troubled because the file-sharing targeted by Comcast was a potential competitive threat to the company's own video services. He said that if the FCC failed to take action in the Comcast case, it could provoke lawmakers in Congress to slap even more explicit rules on broadband providers.

Rival network operators Verizon (VZ.N: Quote, Profile, Research, Stock Buzz) and AT&T (T.N: Quote, Profile, Research, Stock Buzz) issued statements immediately after the vote saying the FCC's action showed that there is no need for Congress to intervene.

"We have argued repeatedly that there is no need for federal legislation in this area, and today's FCC action proves that point," AT&T senior executive vice president Jim Cicconi said in a statement.

Joining Martin to uphold the complaint were the FCC's two Democratic commissioners, Michael Copps and Jonathan Adelstein.

However, the decision drew sharp dissents from Martin's two fellow Republicans, Robert McDowell and Deborah Taylor Tate. They said it was overly intrusive, and worried that it might inhibit broadband providers from cracking down on illegal content like child pornography and pirated material.

McDowell and Tate said the agency should have allowed Comcast and its critics to iron out their dispute without intervention by the government.

They noted that Comcast had already reached an agreement with critics to change the way it manages its network and cooperate with BitTorrent and others.

"For the first time, today our government is choosing regulation over collaboration when it comes to Internet governance," McDowell said. "The (FCC) majority has thrust politicians and bureaucrats into engineering decisions." (Reporting by Peter Kaplan, editing by Tim Dobbyn)
http://www.reuters.com/article/rbssT...47623420080801





Reactions to FCC's Comcast Decision Come Fast and Furious
Matthew Lasar

Hope, indignation, and outrage greeted the Federal Communications Commission's enactment of sanctions against Comcast for throttling P2P applications. Much of the response came before today's ruling, following FCC Chair Kevin Martin's disclosure last week of the impending decision.

A "historic test," complainant Free Press called the move. "If the commission decisively rules against Comcast, it will be a remarkable victory for organized people over organized money." Today's decision confirmed the advocacy group's hopes. "Defying every ounce of conventional wisdom in Washington, every-day people have taken on a major corporation and won an historic precedent for an open Internet."

Jay Monahan, General Counsel of Vuze, told Ars yesterday that when the hi-res video content company filed its net neutrality petition, he didn't expect the explosion of passionate support that followed. "When I saw the thousands of submissions to the Commission by consumers and the standing room only FCC field hearings that we attended and in some cases testified at, that part surprised me," Monahan confided in an interview. "That there were that many people paying this much attention to this."

The FCC's action may also be a global precedent. Ars asked Columbia law professor Tim Wu whether any other country has taken similar steps. It's a tricky call, he responded, because, unlike the United States, some countries have retained their common carrier powers over the Internet.

"However, in terms of enforcement, this is a first in the world as far as I know," Wu said.

Comcast and its allies

Meanwhile, Comcast, the recipient of today's punitive FCC Order, has been serving up a steady stream of clenched jaw rhetoric. "The Commission's order raises significant due process concerns and a variety of substantial legal questions," the company warned today. "We are considering all our legal options and are disappointed that the commission rejected our attempts to settle this issue without further delays."

The rest of the cable industry has resolutely stood by Comcast's side. On Tuesday, a senior VP of Time Warner cable met with the FCC, warning that "government intrusion into broadband providers' traffic management practices would have a chilling effect on investment and innovation." Four days earlier, the National Cable and Telecommunications Association sent the agency a chart of the network management practices of the nation's top colleges and universities. "If there is to be regulation, therefore, it must apply equally to all providers," NCTA's filing grimly advised.

But the undisguised outrage has come from the hardcore right, which views with horror the spectacle of Republican FCC Chair Martin delivering what it sees as the broadband equivalent of the Fairness Doctrine. The Wall Street Journal's editorial writers—who must surely sign a pact never to read the newspaper's excellent articles about telecommunications—lambasted Martin on Wednesday as a self-appointed "Master of the Media Universe," a chump for Moveon.org, and worse.

"Mr. Martin is also greasing the skids for a potential Barack Obama Administration to take an Internet industrial policy who knows where," the Journal warned. Ditto, declared House Republican Minority leader John Boehner, who the next day sent an angry letter to Martin, denouncing his efforts to "hijack the evolution of the Internet to everyone's detriment."

One senses in these frantic protests legitimate fears that Martin's move represents yet another sign that these are the End Days of the Reagan Era. It is very unlikely that the FCC's 42-year-old chief parties with the Free Press crowd. But with today's ruling, he has clearly sided not just with the FCC's "two Democrats," as the Journal bitterly calls them, but with a younger, technology-loving generation that sees government as an ally rather than The Problem.

Net neutrality isn't a slippery slope

In Ars' interview with Jay Monahan, the attorney bristled at the Wall Street Journal's insistence that "net neutrality is a slippery slope toward interventions of all kinds." It is the opposite, he insisted. "What Martin has proposed, and what the Commission is about to do, is exactly designed to protect innovation, and to protect competition," Monahan argued. "If net neutrality means anything, it means not that each of us is made equal in the marketplace, but that at least we have an equal set of rules that are transparent to all of us in order to compete."

Nobody, least of all Vuze, thinks this fight is over. Monahan says he fully expects Comcast to "appeal the Commission's order"—which means a lawsuit against the FCC, a Congressional counterattack, or both. Still, he sees today as a day to celebrate.

"We do view this as a first step," Monahan concluded. "A first step towards helping to build an open and free Internet. And we're grateful to the Commission for having the courage to adopt this order so that we can move forward and go back to our Palo Alto office and continue to compete in this marketplace."
http://arstechnica.com/news.ars/post...d-furious.html





Clear Channel Shareholders Approve Merger
FMQB

Clear Channel Communications announced today that, based on a preliminary vote count, Clear Channel shareholders approved the merger agreement with a group led by Bain Capital Partners, LLC and Thomas H. Lee Partners, L.P. The number of shares voted in favor of the transaction represented more than 74 percent of the total shares outstanding and entitled to vote. The preliminary tabulation indicates that approximately 97 percent of the shares voted were cast in favor of the transaction. The parties intend to consummate the merger on July 30, according to a statement.

"We are pleased with the outcome of today’s vote," said Clear Channel CEO Mark Mays. "On behalf of Clear Channel’s Board of Directors, I want to thank our shareholders and hard-working employees for their support throughout this process."

In May, Clear Channel entered into a third amendment to the merger agreement with the private equity firms. Under the new terms of the deal, Clear Channel shareholders will receive $36 in cash for each share they own. As an alternative to that, shareholders were also offered the opportunity to exchange some or all of their shares of Clear Channel common stock on a one-for-one basis for shares of Class A common stock of CC Media Holdings, Inc., the new corporation formed by the private equity group to acquire Clear Channel.
http://fmqb.com/Article.asp?id=807226





Sirius Satellite Loss Narrows, Subscribers Rise

Sirius Satellite Radio Inc (SIRI.O: Quote, Profile, Research, Stock Buzz) said on Monday its second-quarter adjusted quarterly loss narrowed as it increased subscribers to its pay radio service.

In a preliminary report, Sirius, which is acquiring rival XM Satellite Radio Holdings (XMSR.O: Quote, Profile, Research, Stock Buzz), said its adjusted loss from operations is expected to be $24 million, compared with a loss of $79 million a year earlier.

Sirius did not provide a net loss figure, nor did it give details on what gains or losses were factored into the "adjusted loss from operations."

Revenue rose 25 percent to $283 million.

In the quarter, Sirius added a net 279,820 new subscribers. It ended the period with 8.9 million subscribers, an increase of about 25 percent.

Sirius, the satellite radio home to "shock jock" Howard Stern and the National Football League, said retail subscribers increased 7 percent, while automotive subscribers rose 53 percent.

Last week Sirius' proposed $3.3 billion acquisition of XM drew nearer to completion after it was approved, with conditions, by U.S. communications regulators. The deal will leave just one U.S. satellite radio service.

The Federal Communications Commission voted in favor of a proposal that would allow the deal to proceed as long as the companies meet a series of consumer-protection conditions, including a three-year cap on prices, setting aside 8 percent of their channel capacity for minority and noncommercial programming, and payment of a $19.7 million penalty for past FCC rule violations. (Reporting by Franklin Paul; Editing by Derek Caney and John Wallace)
http://www.reuters.com/article/media...46288020080728





A Quiet Investor Becomes a Media Powerhouse Everyone and Nobody Knows
Tim Arango

Over the Fourth of July weekend at the billionaire Ronald O. Perelman’s 57-acre East Hampton estate the Creeks, Vivi Nevo was in his element.

Mr. Nevo, with his fiancée, the megawatt Chinese actress Zhang Ziyi (the star of “Crouching Tiger, Hidden Dragon”), sitting on his lap, watched Jon Bon Jovi give an impromptu performance before taking a turn on the dance floor to Dave Mason’s “Feelin’ Alright.”

A wind-up doll of kinetic energy, who bounds about like a shortstop, Mr. Nevo, who is 43, is said to be the largest individual shareholder of Time Warner, was once the largest private investor in Goldman Sachs, is engaged to China’s most famous actress, vacations on Rupert Murdoch’s sailboat, is the godfather of Lachlan Murdoch’s son, counts Lenny Kravitz as a good friend and attended Madonna’s wedding in 2000.

And many people, including even some of his close friends, a few of whom joined him at Mr. Perelman’s estate over the Fourth of July — and spoke about the party anonymously because it was a private event — have no idea what his background is or how exactly he made his fortune.

Twenty years or so ago, Vivi Nevo, his first name a nickname for Aviv, was living in a studio apartment in the Concorde building on the Upper East Side of Manhattan. Today he is the media industry’s Zelig, often referred to among his media friends as “the international man of mystery.”

“He is everywhere, all the time, like no one I have ever seen,” said Graydon Carter, the editor in chief of Vanity Fair, which frequently hosts Mr. Nevo at its high society parties.

Who is Mr. Nevo? An Israeli who took a modest inheritance from his family and parlayed it into a sizable fortune through savvy investing, much of it in media and Internet companies — and into connections in the media world.

Behind the scenes, his influence on the media industry is subtle. For upstart Internet companies, he has been an important broker of relationships with traditional firms; and for Time Warner, in particular, he was an advocate, when the Yahoo takeover battle erupted, of trying to assemble a three-way partnership among Yahoo, Microsoft’s MSN and Time Warner’s AOL.

Of all the characters the media business attracts — and creates, for that matter — perhaps no one is more remarked upon, wondered about or marveled at than Mr. Nevo. Among his many overlapping circles of friends, nearly all say that Mr. Nevo is a force in their lives: a loyal friend, a trusted conveyor and keeper of information and someone who never forgets a birthday or a bar mitzvah.

“He’s someone I’ve really liked,” said John J. Mack, the chief executive of Morgan Stanley, who met Mr. Nevo several years ago while he was at the helm of Credit Suisse. “I trust him. He’s got great instincts for the business.”

Gordon Crawford, senior vice president and a director of Capital Research and Management and one of the best-known media investors, met Mr. Nevo around 10 years ago and the two became close. This month they flew together to Sun Valley, Idaho, for the investment bank Allen & Company’s annual media conference. “I don’t know anyone who’s worked harder at developing contacts,” Mr. Crawford said. “It’s definitely more than social. I think he’s a pretty astute observer of what’s going on in the media.”

Mr. Nevo has an uncanny ability to network and a knack for putting himself in the right place at the right time.

In the spring of 1999, John Thornton, who was then president of Goldman Sachs, was in Los Angeles for the bank’s road show before it went public, and after giving a presentation, he sat down. “The guy sitting next to me was Vivi Nevo, and we just started talking and developed a nice rapport right then.” Later, Mr. Thornton became an adviser to Time Warner. “So I dealt with him a lot there,” Mr. Thornton recalled. “He was very active in talking with management. I can’t think of anyone who is principally a private investor who is that focused on one industry.”

Mr. Nevo’s discretion, combined with a lack of a paper trail, equates to a constant chirping of questions in the media industry about his back story.

“He’s a great character, so that draws attention to him,” said Lachlan Murdoch, explaining the growing fascination that people in the media business have about Mr. Nevo. “He’s also a very private individual.

“When I moved back to Australia” — after leaving the News Corporation, where his father is chairman, in 2005 — “we spoke a lot. He’s been a friend through thick and thin.”

Those who knew Mr. Nevo in the 1980s, after he moved to New York from Israel, have watched his rise with curiosity.

“You’re asking questions I’ve asked myself many times,” said Nicolas Rachline, who met Mr. Nevo in the late 1980s when both were part of a fashionable New York expatriate crowd that hung out at Le Bilboquet, a French restaurant on the Upper East Side. “What the hell does Vivi do? He seems to be a powerful player in the entertainment industry. How, I don’t know.”

Mr. Perelman met Mr. Nevo years ago on the Los Angeles social scene — either at Barry Diller’s or at the house of a Creative Artists Agency partner, Bryan Lourd, he said — and the pair’s relationship is purely social. “There’s no business element,” Mr. Perelman said. “It’s purely social, but it’s a deep social. He’s around my family, I’m around his fiancée. We take a lot of trips together.”

The glittery social world that Mr. Nevo inhabits is secondary — and the byproduct of — what is the core of his professional existence: a sizable stake in Time Warner he has maintained for years, apparently with impeccable, buy-and-sell timing. Mr. Nevo, through his firm NV Investments, has never owned 5 percent or more of the company, which would require public disclosure, but it is widely believed in the industry that he is the largest private shareholder; Mr. Nevo himself often says so.

A Time Warner spokesman said that Mr. Nevo is a shareholder but could not verify the size of his holding. But Mr. Nevo does have, and has had for years, the ear of management.

Mr. Nevo, whose workaday uniform is snug, black Christian Dior suits, has a particularly close relationship with Richard D. Parsons, Time Warner’s chairman, who stepped down in January as chief executive. Like many of his media mogul friendships, his relationship with Mr. Parsons started years ago in Sun Valley. “I first met Vivi at the duck pond in Sun Valley,” Mr. Parsons recalled in a phone interview. “In typical Vivi Nevo fashion, we shortly became best buds.”

The personal connections are part of how Mr. Nevo makes investment decisions. “He informs his instincts by being in the space,” Mr. Parsons said. “This is how he absorbs what’s going on, and decides where to place his bets.”

For a man who has become a ubiquitous figure in a very public industry, Mr. Nevo is, and has remained, largely a private, unknown quantity. “He’s not so much mysterious, as he just doesn’t want to be public,” said Mr. Parsons, who is an executor of a trust Mr. Nevo established for his daughter, Lilly, age 6, from a previous relationship. “The mysterious part is, you can’t Google this guy and get his whole story.”

Mr. Nevo has always refused requests for interviews, and he declined to comment for this article. In private conversations with some friends and associates, however, Mr. Nevo has provided glimpses into his background.

The silhouette of Mr. Nevo’s story goes like this: he was an only child who was born in Bucharest, Romania, and moved with his parents to Tel Aviv when he was a baby. His father was a chemical engineer and his mother was an anesthesiologist. As a boy, Mr. Nevo would vacation with his parents in Los Angeles, where he became enchanted with the glamour of Hollywood.

There was family money — his father ran a chemical company, according to several people, including Mr. Nevo’s friend and tennis partner Frank Biondi, the former head of Universal Studios and chief executive of Viacom. But the driving force of his life is the memory of his mother, who died of cancer in the late 1980s, leaving him an inheritance that allowed him to start investing.

“It’s all about the respect he had for his mother,” said Elizabeth Saltzman, international social editor of Vanity Fair, who met Mr. Nevo on the New York social scene in the 1980s (the second time she met him she shared a helicopter with him to the Hamptons). “His mother was everything. I think there’s a huge mama complex, of trying to make her proud.”

With the inheritance — which one business associate of Mr. Nevo’s, who spoke anonymously because his conversations with him were meant to be confidential, pegged at around $10 million — Mr. Nevo set about investing and networking. He opened trading accounts at Goldman Sachs and Morgan Stanley, as well as Allen & Company, which eventually won him an invitation to Sun Valley, the place that became the locus for so many of his relationships, including those with Mr. Parsons and Lachlan Murdoch. Through diligence and hard work, the right contacts and a lot of the right trades during the dot-com bubble of the late 1990s, he turned his inheritance into a sizable fortune.

Mr. Mack said: “He took the money his family left him and he really created this media, trading empire. At Credit Suisse we did a lot of trading business with him, either outright or with derivatives.”

How much money he made is really anyone’s guess. When Mr. Nevo began appearing a few years ago on certain lists, like Vanity Fair’s New Establishment list, Forbes tried to gauge Mr. Nevo’s wealth to see if he belonged on the magazine’s list of billionaires, but ultimately gave up trying. Mr. Nevo owns homes in Malibu, Calif.; the Los Angeles-area neighborhood of Brentwood; the TriBeCa neighborhood of New York; London; and two homes in Tel Aviv, including his modest childhood home outside the city, which sits empty. In addition, he and Ms. Zhang recently bought a home in Beijing.

“Vivi is a very hard worker, and we’d begin chatting about the markets in the early morning, and then we’d talk late in the afternoon,” said Bob Packer, who ran Goldman Sachs’s institutional equities unit in San Francisco and handled many of Mr. Nevo’s trades. “He loved working with the markets. He’s just a really affable, wonderful, loyal guy.”

In the case of Time Warner, his relationship with the company and its executives began in the early to mid-1990s, when he established a relationship with Gerald M. Levin, then chief executive.

“It was in a social context,” Mr. Levin said, trying to recall how he met Mr. Nevo. “I would go to every major fight that HBO had in Las Vegas. It was either at the fights in Las Vegas or at some movie premiere. No, I think it was in Vegas.”

“I spoke to him about Time Warner and what we were doing. Increasingly, he got interested. Unlike some other financial players, he has an interest not just in the financial aspect itself but also the personalities. The social nexus is part of his understanding and analysis.”

Joseph Ravitch, a prominent media investment banker at Goldman Sachs, said Mr. Nevo was “extraordinarily Zelig-like in the sense that he endears himself to a totally diverse group of people from C.E.O.’s to artists and rock stars.”

“But it’s not really Zelig,” he continued, “because he is always the same, open and straightforward Vivi.”

Several years ago, Joseph R. Perella, who led investment banking for Morgan Stanley and was the senior banker on the Time Warner account, received a phone call from Mr. Parsons. “Parsons said, I know a guy you’d like to meet,” Mr. Perella recalled. “Interesting guy. Knows a lot about the business.”

Mr. Perella said they hit it off almost immediately over lunch at San Pietro, a Manhattan restaurant favored by investment bankers. “He’s one of the least boring types I have ever met,” Mr. Perella said. “My sense is he’s a self-made guy who made it himself. He’s just a smart investor. As for the building blocks of his fortune, I have no idea.”

Of late, Mr. Nevo has been sprinkling money around in private companies, many of which are new media ventures. He has around 25 private investments, according to a business associate, including stakes in Demand Media, a social networking company; CityVoter, a social site that allows city dwellers to post about things like where to eat and where to shop; an online music site, Buzznet; Spot Runner, an online advertising company; and the Internet video company Joost. He also has an investment in the Weinstein Company, the film company run by the brothers Bob and Harvey Weinstein, and had a small investment in Bette, a now-shuttered New York restaurant that was owned by Amy Sacco, a prominent nightlife entrepreneur.

Many of the investments are modest in size — about $1 million in the Weinsteins; six figures in Demand Media — but Mr. Nevo’s association with a company brings value beyond the size of the check he writes. “He’s sort of like a media Wizard of Oz,” said Tyler Goldman, the founder of Buzznet, who approached Mr. Nevo last year about investing. “He had some strategic advice, but mostly relationship advice. We were working on a number of deals with bigger media companies, and he had advice on how to approach those.”

Nick Grouf, the chief executive of Spot Runner, said that Mr. Nevo was instrumental in brokering relationships, including with Lachlan Murdoch, who also invested. “Vivi has been very helpful to us in making introductions to his friends,” Mr. Grouf said. “Lachlan is a great example. And with Time Warner, I met Dick Parsons through Vivi.”

In fact, Mr. Nevo’s value — beyond friendship — to many executives is his wealth of information and contacts. “Vivi is plugged in to everything,” Mr. Parsons said. “He hears everything.”

For others, Mr. Nevo is a great friend with a comfy house in Malibu in which to crash, as Lenny Kravitz did during the West Coast part of his 2004 world tour. “It was nice to just have a place to put your stuff,” Mr. Kravitz said in an interview. “If I had to say anything about Vivi Nevo, it’s that he’s all heart. He operates on trust, heart and feeling.”

And about Mr. Nevo’s business? “I don’t go there with him,” Mr. Kravitz said. “And that’s part of our understanding. I’m interested in Vivi Nevo the person.”
http://www.nytimes.com/2008/07/28/bu...ia/28vivi.html





Say So Long to an Old Companion: Cassette Tapes
Andrew Adam Newman

There was a funeral the other day in the Midtown offices of Hachette, the book publisher, to mourn the passing of what it called a “dear friend.” Nobody had actually died, except for a piece of technology, the cassette tape.

While the cassette was dumped long ago by the music industry, it has lived on among publishers of audio books. Many people prefer cassettes because they make it easy to pick up in the same place where the listener left off, or to rewind in case a certain sentence is missed. For Hachette, however, demand had slowed so much that it released its last book on cassette in June, with “Sail,” a novel by James Patterson and Howard Roughan.

The funeral at Hachette — an office party in the audio-book department — mirrored the broader demise of cassettes, which gave vinyl a run for its money before being eclipsed by the compact disc. (The CD, too, is in rapid decline, thanks to Internet music stores, but that is a different story.)

Cassettes have limped along for some time, partly because of their usefulness in recording conversations or making a tape of favorite songs, say, for a girlfriend. But sales of portable tape players, which peaked at 18 million in 1994, sank to 480,000 in 2007, according to the Consumer Electronics Association. The group predicts that sales will taper to 86,000 in 2012.

“I bet you would be hard pressed to find a household in the U.S. that doesn’t have at least a couple cassette tapes hanging around,” said Shawn DuBravac, an economist with the Consumer Electronics Association. Even if publishers of music and audio books stopped using cassettes entirely, people would still shop for tape players because of “the huge libraries of legacy content consumers have kept,” he said.

As long as people keep mix tapes from a high-school sweetheart up in the attic, Mr. DuBravac said, there will still be the urge to hear them. “People have a tremendous amount of installed content and an innate curiosity when coming across a box of tapes to say, ‘Hey, what’s on these?’ ” he said.

The tapes started to really take off in 1979, the year that a radical new cassette player — the Sony Walkman — was introduced, enabling people to listen to Donna Summer and the Knack’s “My Sharona” while they were jogging (remember jogging?). The heft of the early Walkman — slightly smaller and lighter than a brick — is comical by today’s wispy iPod standards, but during the Carter administration it seemed sleek.

Nowadays, listening to music on cassettes is a dying pastime. None of Billboard’s Top 10 albums last week were issued on cassette, though half were released on vinyl, which has been resurging. Last year, only 400,000 music tapes were sold, representing one-tenth of 1 percent of all physical and digital music sales, according to the Recording Industry Association of America. In 1997, the figure was 173 million, and that was when cassettes were already getting a drubbing by CDs. (The iPod wasn’t introduced until 2001.)

“I would not expect to see a revival of cassettes like we’ve seen in the LP market,” Mr. DuBravac said. While vinyl records have always been prized artifacts for their devotees, the plastic cassette tape has little sex appeal.

Such was the case for the eight-track format as well, which was popular in the late 1960s and ’70s. It died relatively quickly with the advent of cassettes because eight-tracks were not widely used for personal recording or mix tapes, Mr. DuBravac said.

While the chances of finding cassette players in a dorm room today are slim, they are still available for sale: on Amazon, Sony alone offers 23 tape players, from the Walkman to boomboxes.

Popping a cassette in the car tape deck is also passé. Only 4 percent of vehicles sold in the United States during the 2007 model year had factory-installed cassette players, according to Ward’s Automotive Yearbook. As recently as the 2005 model year, 23 percent of vehicles had them.

Given that the median age of a car in the United States is nine years old, said Alan K. Binder, the editor of Ward’s yearbook, it is most likely that the majority of the 200 million cars and light trucks on America’s roads have cassette players (though how many have had the same Bob Seger tape lodged unplayable in them for 11 years is impossible to determine).

Cassette tapes’ tendency to hiss — and to melt in the summer and snap in the winter — turns off audiophiles. But for audio books, the cassette is an oddly elegant medium: you can eject it from your car, carry it home and stick it in a boombox, and it will pick up in the same place, an analog feat beyond the ability of the CD.

Cassettes accounted for 7 percent of all sales in the $923 million audio-book industry in 2006, the latest year for which data is available, according to the Audio Publishers Association. While many publishers, like Random House and Macmillan, stopped producing books on cassette in the last couple of years, there are holdouts.

At Blackstone Audio, which produces cassette versions of its roughly 340 annual titles, Josh Stanton, the executive vice president, said there was still demand from libraries and truckers, who buy them at truck stops. But he could forecast only that his company would produce cassettes through 2009.

Recorded Books, whose authors include Philip Roth and Jodi Picoult, still issues cassettes of all its titles, roughly 700 a year. Retailers like Borders and Barnes & Noble have essentially stopped ordering them, but libraries have been slower to abandon them, said Brian Downing, the company’s publisher.

The Web sites of Barnes & Noble and Borders, however, indicate that they still offer some cassettes, though publishers say the stores’ buyers have expressed little interest in ordering more in the future.

At some point, the cassette will go the way of the eight-track, Mr. Downing acknowledged, and his company will publish only in other formats.

“I would guess it would be pretty much gone in three years,” he said.
http://www.nytimes.com/2008/07/28/bu...8cassette.html





Stones Roll Over To Universal Music Group
FMQB

After months of speculation, The Rolling Stones have left EMI for Universal Music Group. UMG said that the new deal with the Stones covers a portion of their back catalog and any future releases. The agreement gives the Polydor imprint any new records from the band, along with full digital and physical rights to releases. The deal also puts the distribution rights for the entire Stones catalog in one place for the first time. UMG already had distribution rights to the band's early catalog, up to 1970. The new agreement now includes everything from 1971's Sticky Fingers onward.

In a statement, the Stones said, "Universal are forward thinking, creative and hands-on music people. We really look forward to working with them." In March, UMG released the soundtrack to the Martin Scorsese Stones documentary Shine A Light in a one-off deal.

UMG said in a statement that it "will begin planning an unprecedented, long-term campaign to reposition the Rolling Stones' entire catalogue for the digital age." UMG CEO Doug Morris added, "There is no question that the Rolling Stones are one of the most important bands in music history."

Reuters reports that Live Nation also tried to add the Stones to their growing roster of exclusive artists.

In related news, happy birthday to Mick Jagger, who turns 65 tomorrow (July 26).
http://fmqb.com/Article.asp?id=808587





Yahoo Offers Coupons for Music that Stops Working
Anick Jesdanun

Yahoo Inc. is offering coupons or refunds to users who find songs they bought inaccessible after Sept. 30, when the company shuts its music-download service.

The decision to close the Yahoo Music Store had added fuel to criticisms over copy-protection measures known as digital rights management, but Yahoo promised it won't entirely abandon loyal customers.

The company said Wednesday it is offering coupons on request for people to buy songs again through Yahoo's new partner, RealNetworks Inc.'s Rhapsody. Those songs will be in the MP3 format, free of copy protection. Refunds are available for users who "have serious problems with this arrangement," Yahoo said.

Spokeswoman Carrie Davis said a "small number" of users are affected by the change. Yahoo wouldn't disclose the actual number.

Yahoo announced this year it was ceasing its online music subscription service and switching customers to Rhapsody. Subscriptions will continue at the same monthly rates for an unspecified period.

For people who bought songs outright — paying a one-time fee for a specific track rather than a continuing subscription for unlimited music — Yahoo will be shutting the digital-rights management servers needed to verify eligibility. Copy-protection measures placed on the tracks require access to those servers when users buy a new computer or upgrade their operating system.

The company warns that "after the store has closed, you will not be able to transfer songs to another computer or relicense these songs after changing operating systems."

Yahoo says users can burn songs onto a regular audio CD and rip them back as an MP3 file without the copy-protection technology, but that requires time and blank CDs, and can result in a loss in quality.

Critics of digital rights management point to Yahoo's decision to end support for legally purchased music as yet another reason to push for tracks free of such limits, something the recording industry is starting to embrace.

Earlier, Microsoft Corp. backtracked from plans to shutter its MSN Music servers this year and agreed to continue authorizing music on new computers through at least 2011.

But Davis said Yahoo opted to shut down its system to avoid "delaying the inevitable."
http://news.yahoo.com/s/ap/20080730/...3RQ 2Ny1k24cA





ImageShack’s Free Torrent Download Service Expands
Ernesto

ImageShack, one of the largest media hosting websites, has implemented some significant upgrades to their torrent download service. One of the most innovative new features is the “video preview”, which allows users to browse through stills of the video they are downloading, to get an impression of the quality of the file.

ImageShack, as the name already suggests, is best known for their image hosting. However, the site has more to offer, like their torrent download service for example.

ImageShack allows its users to upload a .torrent file to the site, which will then be downloaded to the ImageShack servers. After the download is complete, the files can be easily downloaded via a http link in any browser. The service is ideal for people who have throttled connection, and those who don’t want to give out their IP address to the public.

In April we reported that ImageShack had rolled out the BETA version to the public but since then some exiting features have been added. One of these new features is the video preview feature. When you add a popular video torrent to your download queue, it will show you a time-line of image stills, so you can verify the content and the quality of the file. Below is an example of such a time-line.

Torrent download services are not new, but there are only a few that don’t change any money. Jack Levin, the founder of ImageShack explained to TorrentFreak why he started the project: “We think its going to be a great service for users, especially in the light of ISPs rate-limiting torrent traffic. There are a lot of free and legal torrents out there that people should have easy access to too. We have the capacity to do it, and the world needs it.”

Although the service is free, there is a storage limit of 5GB and a transfer limit of 10GB per month. Users that would like to use the service more intensively will have to pay a subscription fee, starting at $10 a month for 10GB disk space and 15GB bandwidth.

Initially, we had some concerns about the service, because it did not support seeding. The torrent simply disconnected as soon as the download was finished, which hurts the overall swarm speed. This has changed as well, as ImageShack now allows users to seed files up to 150%.

The torrent downloads are pretty easy to manage, and the site provides some basic details about the progress of the downloads. Under the “status” link it lists information about the download progress, connected seeds and leechers, share ratio and more. Other great features are selective downloading, which is ideal if you only need one file from a big torrent, and the ability to request an email notification when the download has finished.

It’s doubtful that Hollywood will like the service. However, Levin is not worried about this: “DMCA applies, so, if we get reports from copyright owners to take down content, we will comply,” he told us earlier. Overall we would say that the service does what it promises, it downloads files much faster than most residential connections would, and has become more friendly to the torrent community now it allows seeding. Worth a try.
http://torrentfreak.com/imageshacks-...xpands-080727/





Red Lasso Closes Video Search After Being Sued
Greg Sandoval

RedLasso has suspended access to its video search-and-clipping site two days after NBC Universal and Fox filed a copyright suit against the company.

File this one under inevitable.

RedLasso, which announced the closure in a statement on Friday, recorded TV shows and then indexed clips so users could find, pull, and embed them on other Web sites. They did so without permission. The company had suggested that it was in talks to obtain licenses. RedLasso will keep operating its Radio To Web service, which allows radio stations to search and upload their content to their own Web site.

In May, NBC Universal flatly denied that it had any affiliation with RedLasso when the entertainment company sent a letter accusing RedLasso of "building a business based on the unauthorized syndication of" the content owners' shows.

The era of companies following in YouTube's shoes is over. No more are the studios going to sit back and allow tech start-ups to use their content to grab eyeballs and then negotiate terms later.

Not when they are giving their content away free, at sites like Hulu, the video site created by NBC Universal and News Corp. Anyone can go to Hulu and grab embed code for feature films and many NBC Universal shows without violating the law.

"We are very disappointed in the actions of select networks," RedLasso said in a statement. "We believe we have always acted within the law and have been respectful of the networks' rights. Unfortunately, they have forced our hand."
http://news.cnet.com/8301-1023_3-9999592-93.html





Google to Face Charges Over Down's Syndrome Video

Italian prosecutors say a video which showed four youths taunting a teenager with Down's syndrome was an invasion of privacy
Jonathan Richards

Google is to face criminal charges in Italy over a video which appeared on one of its sites showing a disabled teenager being taunted by his peers.

Italian prosecutors have indicated that they will press charges against four Google executives over a video which was posted on one of the search giant's Italian sites in 2006, which showed four youths making fun of a disabled teenager in a classroom in the northern city of Turin.

Magistrates who have recently ended a two-year investigation into the incident claim that the airing of the 191-second clip, which showed the youths making fun of the teenager before hitting him over the head with a box of tissues, amounted to a breach of privacy and was defamatory.

A Google spokesman said today that the company had co-operated fully with the Italian authorities and that it was "disappointed" with the decision to send Google employees to trial.

"We believe that this proceeding is not about Google Video and what happened, but about the internet as we know it - an open and free environment," the spokesman said.

Google is understood to have removed the clip from the Google Video site within hours of administrators being notified of its existence in September, 2006.

Google has had several run-ins with governments around the world over its video-sharing site, which does not screen content before it is uploaded and relies on its users to point out offensive content.

The case bears resemblances to an incident in the UK in November last year, when a video which appeared to show a 23-year-old woman being sexually assaulted was posted on YouTube. Google, which owns YouTube, was not prosecuted in that case, although it admitted that it had been too slow to remove the clip.

The Italian investigation was prompted after a group acting on behalf of people with Down's syndrome was alerted to the video. The four youths who filmed the incident are also reported to have faced criminal prosecution.

A Google spokesman was quoted by the Wall Street Journal as saying that there was no basis for the legal action because under EU legislation - which has been incorporated into Italian law - Google isn't required to monitor third-party content on its sites. It must only take down offending content when it is notified.

The four executives involved are reported to be the chairman of Google Italy at the time, another Google Italy board member at the time, an executive responsible for privacy policy in Europe, and the then head of Google Video for Europe.

In the past governments in several countries - including Pakistan, Thailand, and Morocco - have temporarily suspended YouTube for streaming what they said was offensive content.

A spokesman for Google today declined to comment on the proceedings.
http://technology.timesonline.co.uk/...cle4397511.ece





Former Employees of Google Prepare Rival Search Engine
Miguel Helft

In her two years at Google, Anna Patterson helped design and build some of the pillars of the company’s search engine, including its large index of Web pages and some of the formulas it uses for ranking search results.

Now, along with her husband, Tom Costello, and a few other Google alumni, she is trying to upstage her former employer.

On Monday, their company, Cuil, is unveiling a search engine that they promise will be more comprehensive than Google’s and that they hope will give its users more relevant results.

“I think it will be better,” Mr. Costello said in an interview. “But there is no question that the public has to decide.”

Cuil, pronounced “cool,” is only the latest in a long string of start-up companies that have been founded and financed with the goal of competing with Google, as well as Yahoo and Microsoft. (In June, Google accounted for 61.5 percent of search queries in the United States, while Yahoo held 20.9 percent and Microsoft had 9.2 percent, according to comScore.) Some of the most prominent include Powerset, which Microsoft recently bought, and Wikia, which was founded by Jimmy Wales, one of the creators of Wikipedia. So far, none have managed to make a dent in the search market.

But some analysts say Cuil has potential, in part because of the pedigree of its founders.

“This is the most promising thing I’ve seen in a while,” said Danny Sullivan, who has followed the online search business for more than a decade and is the editor of Search Engine Land. “Whether they are going to threaten Microsoft, much less Google, that’s another story.”

Mr. Costello, a former researcher at Stanford, said that with 120 billion Web pages, Cuil’s search index is larger than any other. The company uses a form of data mining to group Web pages by content, which makes the search engine more efficient, he said. Instead of showing results as short snippets of text and images with links, it displays longer entries and uses more pictures. It also provides tools to help users further refine their queries.

Google would not comment on Cuil and would not disclose the size of its own index. But in an e-mail statement, Google said that it maintained “the largest collection of documents searchable on the Web” and welcomed competition.

Mr. Sullivan said he was unimpressed by Cuil’s claim that its index includes more Web pages, noting that that could mean users are “overwhelmed by a whole bunch of junk.” But he said that Cuil’s new approach to ranking pages and presenting results could prove to be a hit with some users.

“If it turns out that they have good relevancy, I could see that the word of mouth” would bring Cuil some popularity, he said.

Ms. Patterson left Google in 2006 to found Cuil. The new company has other prominent ex-Google employees, including Russell Power, who worked with Ms. Patterson on the large Google index, and Louis Monier, a former chief technology officer at AltaVista, a pioneering search engine. Cuil, which has about 30 employees and is in Menlo Park, Calif., has raised $33 million from venture investors.
http://www.nytimes.com/2008/07/28/te...gy/28cool.html





Discovering How Greeks Computed in 100 B.C.
John Noble Wilford

After a closer examination of a surviving marvel of ancient Greek technology known as the Antikythera Mechanism, scientists have found that the device not only predicted solar eclipses but also organized the calendar in the four-year cycles of the Olympiad, forerunner of the modern Olympic Games.

The new findings, reported Wednesday in the journal Nature, also suggested that the mechanism’s concept originated in the colonies of Corinth, possibly Syracuse, on Sicily. The scientists said this implied a likely connection with Archimedes.

Archimedes, who lived in Syracuse and died in 212 B.C., invented a planetarium calculating motions of the Moon and the known planets and wrote a lost manuscript on astronomical mechanisms. Some evidence had previously linked the complex device of gears and dials to the island of Rhodes and the astronomer Hipparchos, who had made a study of irregularities in the Moon’s orbital course.

The Antikythera Mechanism, sometimes called the first analog computer, was recovered more than a century ago in the wreckage of a ship that sank off the tiny island of Antikythera, north of Crete. Earlier research showed that the device was probably built between 140 and 100 B.C.

Only now, applying high-resolution imaging systems and three-dimensional X-ray tomography, have experts been able to decipher inscriptions and reconstruct functions of the bronze gears on the mechanism. The latest research has revealed details of dials on the instrument’s back side, including the names of all 12 months of an ancient calendar.

In the journal report, the team led by the mathematician and filmmaker Tony Freeth of the Antikythera Mechanism Research Project, in Cardiff, Wales, said the month names “are unexpectedly of Corinthian origin,” which suggested “a heritage going back to Archimedes.”

No month names on what is called the Metonic calendar were previously known, the researchers noted. Such a calendar, as well as other knowledge displayed on the mechanism, illustrated the influence of Babylonian astronomy on the Greeks. The calendar was used by Babylonians from at least the early fifth century B.C.

Dr. Freeth, who is also associated with Images First Ltd., in London, explained in an e-mail message that the Metonic calendar was designed to reconcile the lengths of the lunar month with the solar year. Twelve lunar months are about 11 days short of a year, but 235 lunar months fit well into 19 years.

“From this it is possible to construct an artificial mathematical calendar that keeps in synchronization with both the sun and the moon,” Dr. Freeth said.

The mechanism’s connection with the Corinthians was unexpected, the researchers said, because other cargo in the shipwreck appeared to be from the eastern Mediterranean, places like Kos, Rhodes and Pergamon. The months inscribed on the instrument, they wrote, are “practically a complete match” with those on calendars from Illyria and Epirus in northwestern Greece and with the island of Corfu. Seven months suggest a possible link with Syracuse.

Inscriptions also showed that one of the instrument’s dials was used to record the timing of the pan-Hellenic games, a four-year cycle that was “a common framework for chronology” by the Greeks, the researchers said.

“The mechanism still contains many mysteries,” Dr. Freeth said. Among the larger questions, scientists and historians said the place of the mechanism in the development of Greek technology remained poorly understood. Several references to similar instruments appear in classical literature, including Cicero’s description of one made by Archimedes. But this one, hauled out of the sea in 1901, is the sole surviving example.
http://www.nytimes.com/2008/07/31/sc...1computer.html





In Study, Evidence of Liberal-Bias Bias

Cable talking heads accuse broadcast networks of liberal bias -- but a think tank finds that ABC, NBC and CBS were tougher on Barack Obama than on John McCain in recent weeks.
James Rainey

Haters of the mainstream media reheated a bit of conventional wisdom last week.

Barack Obama, they said, was getting a free ride from those insufferable liberals.

Such pronouncements, sorry to say, tend to be wrong since they describe a monolithic media that no longer exists. Information today cascades from countless outlets and channels, from the Huffington Post to Politico.com to CBS News and beyond.

But now there's additional evidence that casts doubt on the bias claims aimed -- with particular venom -- at three broadcast networks.

The Center for Media and Public Affairs at George Mason University, where researchers have tracked network news content for two decades, found that ABC, NBC and CBS were tougher on Obama than on Republican John McCain during the first six weeks of the general-election campaign.

You read it right: tougher on the Democrat.

During the evening news, the majority of statements from reporters and anchors on all three networks are neutral, the center found. And when network news people ventured opinions in recent weeks, 28% of the statements were positive for Obama and 72% negative.

Network reporting also tilted against McCain, but far less dramatically, with 43% of the statements positive and 57% negative, according to the Washington-based media center.

Conservatives have been snarling about the grotesque disparity revealed by another study, the online Tyndall Report, which showed Obama receiving more than twice as much network air time as McCain in the last month and a half. Obama got 166 minutes of coverage in the seven weeks after the end of the primary season, compared with 67 minutes for McCain, according to longtime network-news observer Andrew Tyndall.

I wrote last week that the networks should do more to better balance the air time. But I also suggested that much of the attention to Obama was far from glowing.

That earned a spasm of e-mails that described me as irrational, unpatriotic and . . . somehow . . . French.

But the center's director, RobertLichter, who has won conservative hearts with several of his previous studies, told me the facts were the facts.

"This information should blow away this silly assumption that more coverage is always better coverage," he said.

Here's a bit more on the research, so you'll understand how the communications professor and his researchers arrived at their conclusions.

The center reviews and "codes" statements on the evening news as positive or negative toward the candidates. For example, when NBC reporter Andrea Mitchell said in June that Obama "has problems" with white men and suburban women, the media center deemed that a negative.

The positive and negative remarks about each candidate are then totaled to calculate the percentages that cut for and against them.

Visual images and other more subjective cues are not assessed. But the tracking applies a measure of analytical rigor to a field rife with seat-of-the-pants fulminations.

The media center's most recent batch of data covers nightly newscasts beginning June 8, the day after Hillary Rodham Clinton conceded the Democratic nomination, ushering in the start of the general-election campaign. The data ran through Monday, as Obama began his overseas trip.

Most on-air statements during that time could not be classified as positive or negative, Lichter said. The study found, on average, less than two opinion statements per night on the candidates on all three networks combined -- not exactly embracing or pummeling Obama or McCain. But when a point of view did emerge, it tended to tilt against Obama.

That was a reversal of the trend during the primaries, when the same researchers found that 64% of statements about Obama -- new to the political spotlight -- were positive, but just 43% of statements about McCain were positive.

Such reversals are nothing new in national politics, as reporters tend to warm up to newcomers, then turn increasingly critical when such candidates emerge as front-runners.

It might be tempting to discount the latest findings by Lichter's researchers. But this guy is anything but a liberal toady.

In 2006, conservative cable showmen Glenn Beck and Bill O'Reilly had Lichter, a onetime Fox News contributor, on their programs. They heralded his findings in the congressional midterm election: that the networks were giving far more positive coverage to the Democrats.

More proof of the liberal domination of the media, Beck and O'Reilly declared.

Now the same researchers have found something less palatable to those conspiracy theorists.

But don't expect cable talking heads to end their trashing of the networks.

Repeated assertions that the networks are in the tank for Democrats represent not only an article of faith on Fox, but a crucial piece of branding. On Thursday night, O'Reilly and his trusty lieutenant Bernard Goldberg worked themselves into righteous indignation -- again -- about the liberal bias they knew was lurking.

Goldberg seemed gleeful beyond measure in saying that "they're fiddling while their ratings are burning."

O'Reilly assured viewers that "the folks" -- whom he claims to treasure far more than effete network executives do -- "understand what's happening."

By the way, Lichter's group also surveys the first half-hour of "Special Report With Brit Hume," Fox News' answer to the network evening news shows.

The review found that, since the start of the general-election campaign, "Special Report" offered more opinions on the two candidates than all three networks combined.

No surprise there. Previous research has shown Fox News to be opinion-heavy.

"Special Report" was tougher than the networks on Obama -- with 79% of the statements about the Democrat negative, compared with 61% negative on McCain.

There's plenty of room for questioning the networks' performance and watching closely for symptoms of Obamamania.

But could we at least remain focused on what ABC, NBC and CBS actually put on the air, rather than illusions that their critics create to puff themselves up?
http://www.latimes.com/news/politics...0,712999.story

[JackSpratts]

Why Apple Must Tell Its Story

With Fortunes So Tied to Jobs, Marketer Needs to Lay Out Succession Plan
Michael Bush

The connection between Apple and Steve Jobs is unlike any other brand and CEO relationship in corporate America, maybe the world. The unflappable, black turtleneck-wearing founder is viewed as the public face of Apple, and the driving creative force behind every cool gadget it releases. In fact Jobs so epitomizes the brand that even the Mac guy in the Mac vs. PC ads is clearly meant to evoke the founder

So when Mr. Jobs catches a cold, Apple sneezes. And that's why the rumors and innuendo swirling about his health are particularly serious for Apple. It started with blogosphere buzz in June after Mr. Jobs -- who had been diagnosed with pancreatic cancer in 2004 -- appeared extremely thin, bordering on frail, while introducing the latest version of the iPhone.

Once word started circulating that he may be ill, Apple stock took a considerable hit, dropping more than $10 a share. And when Mr. Jobs was absent from last week's quarterly earnings conference call, the questions started again -- and the stock fell again.

The irony, of course, is that in the age of transparency, new media and blogs, the notoriously tight-lipped Apple is one of the few companies that manage to get away with a we-don't-have-to-respond approach to media relations. But in light of the recent questions surrounding Mr. Jobs' health, some argue it's time to start telling its life-after-Jobs story.

"The difficulty they have is the very real possibility that in Steve Jobs, Apple has created a person that cannot be replaced," said Rob Enderle, principal analyst, Enderle Group. "It's one thing to have a PR campaign that talks about life after Jobs, but would a PR campaign convince you that there would be life on earth if the sun went out?"

Opacity

But if you're thinking that the company will open up to address Mr. Jobs' health and maybe its succession plan, don't hold your breath.

"If Apple decides to tell that story it's going to be when they decide to tell that story, not when the rumor mill asks them to," said a former Apple employee. "Apple has always been very private about anything related to employees. And when someone like the CEO is involved I think they are going to be even more so."

And Apple isn't offering much of a peek under the kimono. "Steve loves Apple, serves as its CEO at the pleasure of Apple's board and has no plans to leave Apple," said Steve Dowling, director-corporate PR for the company. "Steve's health is a private matter, and as you know, Apple does have a succession plan but it's confidential for obvious reasons."

But where does that leave Joe Investor if even Mr. Enderle, who follows the company more closely than most, doesn't believe the company has a credible succession strategy or is creating one?

"After being booted out of the company once, Steve Jobs probably isn't really excited about the board creating a solid plan to replace him," Mr. Enderle said. There's no doubt Mr. Jobs would have his hands involved in a succession plan as it's common knowledge that nothing gets done at Apple without his OK.

No disclosure needed

Michael Gartenberg, VP-research director at Jupiter Research, thinks Apple should not launch a PR or media relations campaign to explain itself. "Everything the company does is put under a microscope and I guess people make stock purchases based on such information. Perhaps this is the downside of that relationship, but I certainly don't feel that means they need to disclose anything other than his ability to run the company as CEO."

Mark Hass, CEO of Manning Selvage & Lee, said when a company is so closely tied to its CEO "you almost need to have a marketing crisis plan in place" should that individual decide to leave or step down.

Even so, Mr. Hass doesn't know if it's the right time to start introducing other executives within Apple to the public or talking about a succession plan. "The brand's success is so closely tied to him that you don't want to necessarily mess with a formula that's working unless you need to," he said. "If it's not broken, don't fix it."
http://adage.com/article?article_id=129926





Flipping Web Sites, Selling the Niche
Abha Bhattarai

Dave Hermansen did not own a bird or a cage when he bought bird-cage.com, an online store, for $1,800 three years ago. He simply saw a Web site that was “very, very poorly done,” and begged the owners to sell it to him. He then redesigned the site, added advertising and drove up traffic. Last December, he sold it for $173,000.

Mr. Hermansen, 30, is among the latest wave of entrepreneurs who, like the day traders and real estate investors before them, are looking to make a lot of money without much effort.

They use little more than home computers and free software to buy Web sites that appeal to a small and specific niche. Then they fix up the sites with hopes of reselling them for far more than they paid.

But while their dreams are fueled by high-profile Internet deals — Condé Nast’s $25 million purchase of Wired News, People.com’s acquisition of Celebrity Baby Blog and, most recently, a deal this month between Guardian News and Media and the owner of PaidContent for a reported $30 million — these entrepreneurs have smaller ambitions for their sites. Many end up settling for just hundreds, sometimes thousands of dollars.

“Everyone with a site is saying, ‘If I can get it to the right value, I’m out,’ ” said Gene Alvarez, vice president for research at Gartner, a technology consulting firm. “I call it the burger-flipping model: You build up volume, you build a community and then you try to sell it while it’s still hot.”

Some Web sites begin as labors of love. Take Celebrity Baby Blog, which Danielle Friedland, the creator, has said she created after reeling off facts during the 2004 Golden Globes “about who was pregnant with twins or had recently given birth.” Four years later, People.com bought the Web site after it noticed an unfulfilled niche: “a very passionate community of young moms,” said Fran Hauser, president of People Digital.

Ms. Hauser said she would not comment on the sale price. Industry insiders speculate it was in the low millions.

Most flippers aim a bit lower. They troll the Internet for sites that, according to Mike Lyon, an investment banker at Arbor Advisors, are “undervalued property” — poorly designed, with little visibility on the Web.

While there is no data on how many people flip Web sites, the number of sites sold on eBay has doubled over the last three months, the company said. At SitePoint’s marketplace, a similar forum where users can auction off Web sites, sales have quadrupled in the last year, said Matt Mickiewicz, a founder of the site.

The changing economics of the Web have made it easier to find and exploit niche communities on the Internet. The Internet boom of the 1990s spawned companies like Pets.com that were Web versions of brick-and-mortar stores. They required stockpiling products and shipping them to customers. But that model came crashing down with the Web bust of 2000.

Since then, building niche Web sites and small-scale online stores has become cheap and easy. Free software, advertising systems like Google’s, and “drop shipping” services that allow Web site owners to handle products through a third-party supplier, have lowered the cost of doing business.

Instead of selling goods and services, analysts said most flippers are looking into the easiest way to make a quick buck, by tapping into specialized advertising.

Philip Kaplan, who captured attention with a Web site that rejoiced in the unraveling of the dot-com bubble, now helps sites secure online advertising through his company AdBrite. He said in an interview that he has been encouraging site owners to “carve out a focused niche.”

“All of our advertisers are saying, ‘We want this niche or that niche,’ ” he said. “They never say, ‘We want to advertise on a site about nothing.’ ”

Mr. Hermansen, of bird-cage.com, says he is always looking for areas on the Internet with high search volume and little competition.

“Once I found the bird niche, I knew it was where I wanted to be,” he said.

Before bird cages, Mr. Hermansen owned — and sold — niche Web sites about paintball, remote-control toys and electric scooters. In 2005, he quit his job as a draftsman to flip Web sites full time.

“It used to be that if you had a site worth a million dollars, you’d hire an investment bank or a broker to sell it,” Mr. Mickiewicz, of SitePoint, said. “But if you had one that generated less than that, you’d just have to sit on it. Now you can sell anything for any sort of profit, whether it’s $20 or $220,000.”

The average selling price of Web sites on eBay was $78 last month. There, sites for sale range from online stores specializing in gift baskets and patio grills to message boards and forums devoted to the online game World of Warcraft and deep sea fishing. The marketplace at SitePoint offers sites about chicken recipes, bonsai trees and hiking stories. “Low-maintenance content sites” like blogs, online communities and directories are the most popular, Mr. Mickiewicz said, adding that a Web site’s selling price is generally one to three times the value of its annual revenue.

Peter T. Davis, who calls himself a “Web property developer,” said he owns about 20 Web sites, including message boards about model railroads and coin collecting.

Mr. Davis said he generally holds onto Web sites for at least a few months before flipping them. Sometimes, though, the process is much quicker — like the time he bought a forum about day care centers for $1,500 and sold it six hours later for $3,500.

“I used to make my own Web sites and sell them, but then I realized, ‘Hey, this is much easier than making them,’ ” he said. “It’s as simple as buying a Web site from someone and making it more attractive. It’s about creating value where there was none.”

Creating the value, though, is the tricky part. Many Web site flippers said they begin by tweaking a site’s template and making other superficial changes like adjusting fonts, colors and type sizes. After that, they manipulate a Web site’s structure, coding and presentation so it shows up more prominently in Web searches.

In an era when Web use is increasingly search-driven, making sure people find your site makes all the difference, Mr. Hermansen said. “Once you beef up traffic, everything else just happens,” he added.

Consumer protection groups warn potential buyers. Traffic generators and click fraud can easily exaggerate Web site traffic. Web site owners can inflate revenue statistics and tamper with search engine rankings.

“It’s an increasing law enforcement challenge,” said Lois C. Greisman, associate director for marketing practices at the Federal Trade Commission. “It’s hard to measure fraud on the Internet, but this is just a variation on the classic get-rich-quick scheme.”

Last year, Mr. Hermansen said he did something he had wanted to do for years: he bought a parrot, Sunny. Earlier this month, Mr. Hermansen and his brother, Mike, set up a warehouse and started manufacturing and selling their own line of bird cages.

Now Sunny lives in one of the cages in the Hermansens’ warehouse and is the mascot for their newest Web site, Innovative Cages.com. Mr. Hermansen said he has found yet another Internet void to fill: “the high-end, high-priced luxury cage niche.”

“Of course,” he added, “the eventual goal is to sell the site for a good chunk of money.”
http://www.nytimes.com/2008/07/29/te...gy/29flip.html





Expensive

$1,000 Spray Makes Electronic Gadgets Completely Waterproof

Technology Could Help Emergency First-Responders

A new $1,000 spray claims to protect notebook computers, iPods, cell phones and other electronic gadgets from liquid, making them completely waterproof.

The spray, called Golden Shellback Splash Proof Coating, is one thousandth of an inch thick.

Sid Martin of the Northeast Maritime Institute, which created the product, said the spray forces the water to roll off electronic gadgets like water off a duck's back or "just like after you waxed your car," KPIX-TV reported.

A reporter tossed a Blackberry in a tub of water and it continued to play.

"Not only is it still working, but we are still getting audio from the iPod Touch in the connected speakers," the woman said. "You really don't see much of a coating or feel much of a coating."

Martin said the technology could be used for emergency first-responders, bio-medical devices and historic preservation.

The product should be available to the public later this year.
http://www.local6.com/technology/17011560/detail.html





The Hole Trick

How Skype & Co. Get Round Firewalls

Peer-to-peer software applications are a network administrator's nightmare. In order to be able to exchange packets with their counterpart as directly as possible they use subtle tricks to punch holes in firewalls, which shouldn't actually be letting in packets from the outside world.

Increasingly, computers are positioned behind firewalls to protect systems from internet threats. Ideally, the firewall function will be performed by a router, which also translates the PC's local network address to the public IP address (Network Address Translation, or NAT). This means an attacker cannot directly adress the PC from the outside - connections have to be established from the inside.

This is of course a problem when two computers behind NAT firewalls require to talk directly to each other - if, for example, their users want to call each other using Voice over IP (VoIP). The dilemma is clear - whichever party calls the other, the recipient's firewall will decline the apparent attack and will simply discard the data packets. The telephone call doesn't happen. Or at least that's what a network administrator would expect.

Punched

But anyone who has used the popular internet telephony software Skype knows that it works as smoothly behind a NAT firewall as it does if the PC is connected directly to the internet. The reason for this is that the inventors of Skype and similar software have come up with a solution.

Naturally every firewall must also let packets through into the local network - after all the user wants to view websites, read e-mails, etc. The firewall must therefore forward the relevant data packets from outside, to the workstation computer on the LAN. However it only does so, when it is convinced that a packet represents the response to an outgoing data packet. A NAT router therefore keeps tables of which internal computer has communicated with which external computer and which ports the two have used.

The trick used by VoIP software consists of persuading the firewall that a connection has been established, to which it should allocate subsequent incoming data packets. The fact that audio data for VoIP is sent using the connectionless UDP protocol acts to Skype's advantage. In contrast to TCP, which includes additional connection information in each packet, with UDP, a firewall sees only the addresses and ports of the source and destination systems. If, for an incoming UDP packet, these match an NAT table entry, it will pass the packet on to an internal computer with a clear conscience.

Switching

The switching server, with which both ends of a call are in constant contact, plays an important role when establishing a connection using Skype. This occurs via a TCP connection, which the clients themselves establish. The Skype server therefore always knows under what address a Skype user is currently available on the internet. Where possible the actual telephone connections do not run via the Skype server; rather, the clients exchange data directly.

Let's assume that Alice wants to call her friend Bob. Her Skype client tells the Skype server that she wants to do so. The Skype server already knows a bit about Alice. From the incoming query it sees that Alice is currently registered at the IP address 1.1.1.1 and a quick test reveals that her audio data always comes from UDP port 1414. The Skype server passes this information on to Bob's Skype client, which, according to its database, is currently registered at the IP address 2.2.2.2 and which, by preference uses UDP port 2828.

Step 1: Alice tries to call Bob, which signals Skype.

Bob's Skype program then punches a hole in its own network firewall: It sends a UDP packet to 1.1.1.1 port 1414. This is discarded by Alice's firewall, but Bob's firewall doesn't know that. It now thinks that anything which comes from 1.1.1.1 port 1414 and is addressed to Bob's IP address 2.2.2.2 and port 2828 is legitimate - it must be the response to the query which has just been sent.

Step 2: Bob tries to reach Alice, which punches a hole through Bob's Firewall.

Now the Skype server passes Bob's coordinates on to Alice, whose Skype application attempts to contact Bob at 2.2.2.2:2828. Bob's firewall sees the recognised sender address and passes the apparent response on to Bob's PC - and his Skype phone rings.

Step 3: Alice finally reaches Bobs computer through the hole.

Doing the rounds

This description is of course somewhat simplified - the details depend on the specific properties of the firewalls used. But it corresponds in principle to our observations of the process of establishing a connection between two Skype clients, each of which was behind a Linux firewall. The firewalls were configured with NAT for a LAN and permitted outgoing UDP traffic.

Linux' NAT functions have the VoIP friendly property of, at least initially, not changing the ports of outgoing packets. The NAT router merely replaces the private, local IP address with its own address - the UDP source port selected by Skype is retained. Only when multiple clients on the local network use the same source port does the NAT router stick its oar in and reset the port to a previously unused value. This is because each set of two IP addresses and ports must be able to be unambiguously assigned to a connection between two computers at all times. The router will subsequently have to reconstruct the internal IP address of the original sender from the response packet's destination port.

Other NAT routers will try to assign ports in a specific range, for example ports from 30,000 onwards, and translate UDP port 1414, if possible, to 31414. This is, of course, no problem for Skype - the procedure described above continues to work in a similar manner without limitations.

It becomes a little more complicated if a firewall simply assigns ports in sequence, like Check Point's FireWall-1: the first connection is assigned 30001, the next 30002, etc. The Skype server knows that Bob is talking to it from port 31234, but the connection to Alice will run via a different port. But even here Skype is able to outwit the firewall. It simply runs through the ports above 31234 in sequence, hoping at some point to stumble on the right one. But if this doesn't work first go, Skype doesn't give up. Bob's Skype opens a new connection to the Skype server, the source port of which is then used for a further sequence of probes.

Skype can do port scans. Here it suceeds on port 38901 and connects through the firewall.

Nevertheless, in very active networks Alice may not find the correct, open port. The same also applies for a particular type of firewall, which assigns every new connection to a random source port. The Skype server is then unable to tell Alice where to look for a suitable hole in Bob's firewall.

However, even then, Skype doesn't give up. In such cases a Skype server is then used as a relay. It accepts incoming connections from both Alice and Bob and relays the packets onwards. This solution is always possible, as long as the firewall permits outgoing UDP traffic. It involves, however, an additional load on the infrastructure, because all audio data has to run through Skype's servers. The extended packet transmission times can also result in an unpleasant delay.

Use of the procedure described above is not limited to Skype and is known as "UDP hole punching". Other network services such as the Hamachi gaming VPN application, which relies on peer-to-peer communication between computers behind firewalls, use similar procedures. A more developed form has even made it to the rank of a standard - RFC 3489 "Simple Traversal of UDP through NAT" (STUN) describes a protocol which with two STUN clients can get around the restrictions of NAT with the help of a STUN server in many cases. The draft Traversal Using Relay NAT (TURN) protocol describes a possible standard for relay servers.

DIY hole punching

With a few small utilities, you can try out UDP hole punching for yourself. The tools required, hping2 and netcat, can be found in most Linux distributions. Local is a computer behind a Linux firewall (local-fw) with a stateful firewall which only permits outgoing (UDP) connections. For simplicity, in our test the test computer remote was connected directly to the internet with no firewall.

Firstly start a UDP listener on UDP port 14141 on the local/1 console behind the firewall:
local/1# nc -u -l -p 14141

An external computer "remote" then attempts to contact it.
remote# echo "hello" | nc -p 53 -u local-fw 14141

However, as expected nothing is received on local/1 and, thanks to the firewall, nothing is returned to remote. Now on a second console, local/2, hping2, our universal tool for generating IP packets, punches a hole in the firewall:
local/2# hping2 -c 1 -2 -s 14141 -p 53 remote

As long as remote is behaving itself, it will send back a "port unreachable" response via ICMP - however this is of no consequence. On the second attempt
remote# echo "hello" | nc -p 53 -u local-fw 14141

the netcat listener on console local/1 then coughs up a "hello" - the UDP packet from outside has passed through the firewall and arrived at the computer behind it.

Network administrators who do not appreciate this sort of hole in their firewall and are worried about abuse, are left with only one option - they have to block outgoing UDP traffic, or limit it to essential individual cases. UDP is not required for normal internet communication anyway - the web, e-mail and suchlike all use TCP. Streaming protocols may, however, encounter problems, as they often use UDP because of the reduced overhead.

Astonishingly, hole punching also works with TCP. After an outgoing SYN packet the firewall / NAT router will forward incoming packets with suitable IP addresses and ports to the LAN even if they fail to confirm, or confirm the wrong sequence number (ACK). Linux firewalls at least, clearly fail to evaluate this information consistently. Establishing a TCP connection in this way is, however, not quite so simple, because Alice does not have the sequence number sent in Bob's first packet. The packet containing this information was discarded by her firewall.
http://www.heise-online.co.uk/securi...atures/82481/0





Malwebolence
Mattathias Schwartz

One afternoon in the spring of 2006, for reasons unknown to those who knew him, Mitchell Henderson, a seventh grader from Rochester, Minn., took a .22-caliber rifle down from a shelf in his parents’ bedroom closet and shot himself in the head. The next morning, Mitchell’s school assembled in the gym to begin mourning. His classmates created a virtual memorial on MySpace and garlanded it with remembrances. One wrote that Mitchell was “an hero to take that shot, to leave us all behind. God do we wish we could take it back. . . . ” Someone e-mailed a clipping of Mitchell’s newspaper obituary to MyDeathSpace.com, a Web site that links to the MySpace pages of the dead. From MyDeathSpace, Mitchell’s page came to the attention of an Internet message board known as /b/ and the “trolls,” as they have come to be called, who dwell there.

/b/ is the designated “random” board of 4chan.org, a group of message boards that draws more than 200 million page views a month. A post consists of an image and a few lines of text. Almost everyone posts as “anonymous.” In effect, this makes /b/ a panopticon in reverse — nobody can see anybody, and everybody can claim to speak from the center. The anonymous denizens of 4chan’s other boards — devoted to travel, fitness and several genres of pornography — refer to the /b/-dwellers as “/b/tards.”

Measured in terms of depravity, insularity and traffic-driven turnover, the culture of /b/ has little precedent. /b/ reads like the inside of a high-school bathroom stall, or an obscene telephone party line, or a blog with no posts and all comments filled with slang that you are too old to understand.

Something about Mitchell Henderson struck the denizens of /b/ as funny. They were especially amused by a reference on his MySpace page to a lost iPod. Mitchell Henderson, /b/ decided, had killed himself over a lost iPod. The “an hero” meme was born. Within hours, the anonymous multitudes were wrapping the tragedy of Mitchell’s death in absurdity.

Someone hacked Henderson’s MySpace page and gave him the face of a zombie. Someone placed an iPod on Henderson’s grave, took a picture and posted it to /b/. Henderson’s face was appended to dancing iPods, spinning iPods, hardcore porn scenes. A dramatic re-enactment of Henderson’s demise appeared on YouTube, complete with shattered iPod. The phone began ringing at Mitchell’s parents’ home. “It sounded like kids,” remembers Mitchell’s father, Mark Henderson, a 44-year-old I.T. executive. “They’d say, ‘Hi, this is Mitchell, I’m at the cemetery.’ ‘Hi, I’ve got Mitchell’s iPod.’ ‘Hi, I’m Mitchell’s ghost, the front door is locked. Can you come down and let me in?’ ” He sighed. “It really got to my wife.” The calls continued for a year and a half.

In the late 1980s, Internet users adopted the word “troll” to denote someone who intentionally disrupts online communities. Early trolling was relatively innocuous, taking place inside of small, single-topic Usenet groups. The trolls employed what the M.I.T. professor Judith Donath calls a “pseudo-naïve” tactic, asking stupid questions and seeing who would rise to the bait. The game was to find out who would see through this stereotypical newbie behavior, and who would fall for it. As one guide to trolldom puts it, “If you don’t fall for the joke, you get to be in on it.”

Today the Internet is much more than esoteric discussion forums. It is a mass medium for defining who we are to ourselves and to others. Teenagers groom their MySpace profiles as intensely as their hair; escapists clock 50-hour weeks in virtual worlds, accumulating gold for their online avatars. Anyone seeking work or love can expect to be Googled. As our emotional investment in the Internet has grown, the stakes for trolling — for provoking strangers online — have risen. Trolling has evolved from ironic solo skit to vicious group hunt.

“Lulz” is how trolls keep score. A corruption of “LOL” or “laugh out loud,” “lulz” means the joy of disrupting another’s emotional equilibrium. “Lulz is watching someone lose their mind at their computer 2,000 miles away while you chat with friends and laugh,” said one ex-troll who, like many people I contacted, refused to disclose his legal identity.

Another troll explained the lulz as a quasi-thermodynamic exchange between the sensitive and the cruel: “You look for someone who is full of it, a real blowhard. Then you exploit their insecurities to get an insane amount of drama, laughs and lulz. Rules would be simple: 1. Do whatever it takes to get lulz. 2. Make sure the lulz is widely distributed. This will allow for more lulz to be made. 3. The game is never over until all the lulz have been had.”

/b/ is not all bad. 4chan has tried (with limited success) to police itself, using moderators to purge child porn and eliminate calls to disrupt other sites. Among /b/’s more interesting spawn is Anonymous, a group of masked pranksters who organized protests at Church of Scientology branches around the world.

But the logic of lulz extends far beyond /b/ to the anonymous message boards that seem to be springing up everywhere. Two female Yale Law School students have filed a suit against pseudonymous users who posted violent fantasies about them on AutoAdmit, a college-admissions message board. In China, anonymous nationalists are posting death threats against pro-Tibet activists, along with their names and home addresses. Technology, apparently, does more than harness the wisdom of the crowd. It can intensify its hatred as well.

Jason Fortuny might be the closest thing this movement of anonymous provocateurs has to a spokesman. Thirty-two years old, he works “typical Clark Kent I.T.” freelance jobs — Web design, programming — but his passion is trolling, “pushing peoples’ buttons.” Fortuny frames his acts of trolling as “experiments,” sociological inquiries into human behavior. In the fall of 2006, he posted a hoax ad on Craigslist, posing as a woman seeking a “str8 brutal dom muscular male.” More than 100 men responded. Fortuny posted their names, pictures, e-mail and phone numbers to his blog, dubbing the exposé “the Craigslist Experiment.” This made Fortuny the most prominent Internet villain in America until November 2007, when his fame was eclipsed by the Megan Meier MySpace suicide. Meier, a 13-year-old Missouri girl, hanged herself with a belt after receiving cruel messages from a boy she’d been flirting with on MySpace. The boy was not a real boy, investigators say, but the fictional creation of Lori Drew, the mother of one of Megan’s former friends. Drew later said she hoped to find out whether Megan was gossiping about her daughter. The story — respectable suburban wife uses Internet to torment teenage girl — was a media sensation.

Fortuny’s Craigslist Experiment deprived its subjects of more than just privacy. Two of them, he says, lost their jobs, and at least one, for a time, lost his girlfriend. Another has filed an invasion-of-privacy lawsuit against Fortuny in an Illinois court. After receiving death threats, Fortuny meticulously scrubbed his real address and phone number from the Internet. “Anyone who knows who and where you are is a security hole,” he told me. “I own a gun. I have an escape route. If someone comes, I’m ready.”

While reporting this article, I did everything I could to verify the trolls’ stories and identities, but I could never be certain. After all, I was examining a subculture that is built on deception and delights in playing with the media. If I had doubts about whether Fortuny was who he said he was, he had the same doubts about me. I first contacted Fortuny by e-mail, and he called me a few days later. “I checked you out,” he said warily. “You seem legitimate.” We met in person on a bright spring day at his apartment, on a forested slope in Kirkland, Wash., near Seattle. He wore a T-shirt and sweat pants, looking like an amiable freelancer on a Friday afternoon. He is thin, with birdlike features and the etiolated complexion of one who works in front of a screen. He’d been chatting with an online associate about driving me blindfolded from the airport, he said. “We decided it would be too much work.”

A flat-screen HDTV dominated Fortuny’s living room, across from a futon prepped with neatly folded blankets. This was where I would sleep for the next few nights. As Fortuny picked up his cat and settled into an Eames-style chair, I asked whether trolling hurt people. “I’m not going to sit here and say, ‘Oh, God, please forgive me!’ so someone can feel better,” Fortuny said, his calm voice momentarily rising. The cat lay purring in his lap. “Am I the bad guy? Am I the big horrible person who shattered someone’s life with some information? No! This is life. Welcome to life. Everyone goes through it. I’ve been through horrible stuff, too.”

“Like what?” I asked. Sexual abuse, Fortuny said. When Jason was 5, he said, he was molested by his grandfather and three other relatives. Jason’s mother later told me, too, that he was molested by his grandfather. The last she heard from Jason was a letter telling her to kill herself. “Jason is a young man in a great deal of emotional pain,” she said, crying as she spoke. “Don’t be too harsh. He’s still my son.”

In the days after the Megan Meier story became public, Lori Drew and her family found themselves in the trolls’ crosshairs. Their personal information — e-mail addresses, satellite images of their home, phone numbers — spread across the Internet. One of the numbers led to a voice-mail greeting with the gleeful words “I did it for the lulz.” Anonymous malefactors made death threats and hurled a brick through the kitchen window. Then came the Megan Had It Coming blog. Supposedly written by one of Megan’s classmates, the blog called Megan a “drama queen,” so unstable that Drew could not be blamed for her death. “Killing yourself over a MySpace boy? Come on!!! I mean yeah your fat so you have to take what you can get but still nobody should kill themselves over it.” In the third post the author revealed herself as Lori Drew.

This post received more than 3,600 comments. Fox and CNN debated its authenticity. But the Drew identity was another mask. In fact, Megan Had It Coming was another Jason Fortuny experiment. He, not Lori Drew, Fortuny told me, was the blog’s author. After watching him log onto the site and add a post, I believed him. The blog was intended, he says, to question the public’s hunger for remorse and to challenge the enforceability of cyberharassment laws like the one passed by Megan’s town after her death. Fortuny concluded that they were unenforceable. The county sheriff’s department announced it was investigating the identity of the fake Lori Drew, but it never found Fortuny, who is not especially worried about coming out now. “What’s he going to sue me for?” he asked. “Leading on confused people? Why don’t people fact-check who this stuff is coming from? Why do they assume it’s true?”

Fortuny calls himself “a normal person who does insane things on the Internet,” and the scene at dinner later on the first day we spent together was exceedingly normal, with Fortuny, his roommate Charles and his longtime friend Zach trading stories at a sushi restaurant nearby over sake and happy-hour gyoza. Fortuny flirted with our waitress, showing her a cellphone picture of his cat. “He commands you to kill!” he cackled. “Do you know how many I’ve killed at his command?” Everyone laughed.

Fortuny spent most of the weekend in his bedroom juggling several windows on his monitor. One displayed a chat room run by Encyclopedia Dramatica, an online compendium of troll humor and troll lore. It was buzzing with news of an attack against the Epilepsy Foundation’s Web site. Trolls had flooded the site’s forums with flashing images and links to animated color fields, leading at least one photosensitive user to claim that she had a seizure.

WEEV: the whole posting flashing images to epileptics thing? over the line.

HEPKITTEN: can someone plz tell me how doing something the admins intentionally left enabled is hacking?

WEEV: it’s hacking peoples unpatched brains. we have to draw a moral line somewhere.

Fortuny disagreed. In his mind, subjecting epileptic users to flashing lights was justified. “Hacks like this tell you to watch out by hitting you with a baseball bat,” he told me. “Demonstrating these kinds of exploits is usually the only way to get them fixed.”

“So the message is ‘buy a helmet,’ and the medium is a bat to the head?” I asked.

“No, it’s like a pitcher telling a batter to put on his helmet by beaning him from the mound. If you have this disease and you’re on the Internet, you need to take precautions.” A few days later, he wrote and posted a guide to safe Web surfing for epileptics.

On Sunday, Fortuny showed me an office building that once housed Google programmers, and a low-slung modernist structure where programmers wrote Halo 3, the best-selling video game. We ate muffins at Terra Bite, a coffee shop founded by a Google employee where customers pay whatever price they feel like. Kirkland seemed to pulse with the easy money and optimism of the Internet, unaware of the machinations of the troll on the hill.

We walked on, to Starbucks. At the next table, middle-schoolers with punk-rock haircuts feasted noisily on energy drinks and whipped cream. Fortuny sipped a white-chocolate mocha. He proceeded to demonstrate his personal cure for trolling, the Theory of the Green Hair.

“You have green hair,” he told me. “Did you know that?”

“No,” I said.

“Why not?”

“I look in the mirror. I see my hair is black.”

“That’s uh, interesting. I guess you understand that you have green hair about as well as you understand that you’re a terrible reporter.”

“What do you mean? What did I do?”

“That’s a very interesting reaction,” Fortuny said. “Why didn’t you get so defensive when I said you had green hair?” If I were certain that I wasn’t a terrible reporter, he explained, I would have laughed the suggestion off just as easily. The willingness of trolling “victims” to be hurt by words, he argued, makes them complicit, and trolling will end as soon as we all get over it.

On Monday we drove to the mall. I asked Fortuny how he could troll me if he so chose. He took out his cellphone. On the screen was a picture of my debit card with the numbers clearly legible. I had left it in plain view beside my laptop. “I took this while you were out,” he said. He pressed a button. The picture disappeared. “See? I just deleted it.”

The Craigslist Experiment, Fortuny reiterated, brought him troll fame by accident. He was pleased with how the Megan Had It Coming blog succeeded by design. As he described the intricacies of his plan — adding sympathetic touches to the fake classmate, making fake Lori Drew a fierce defender of her own daughter, calibrating every detail to the emotional register of his audience — he sounded not so much a sociologist as a playwright workshopping a set of characters.

“You seem to know exactly how much you can get away with, and you troll right up to that line,” I said. “Is there anything that can be done on the Internet that shouldn’t be done?”

Fortuny was silent. In four days of conversation, this was the first time he did not have an answer ready.

“I don’t know,” he said. “I have to think about it.”

Sherrod DeGrippo, a 28-year-old Atlanta native who goes by the name Girlvinyl, runs Encyclopedia Dramatica, the online troll archive. In 2006, DeGrippo received an e-mail message from a well-known band of trolls, demanding that she edit the entry about them on the Encyclopedia Dramatica site. She refused. Within hours, the aggrieved trolls hit the phones, bombarding her apartment with taxis, pizzas, escorts and threats of rape and violent death. DeGrippo, alone and terrified, sought counsel from a powerful friend. She called Weev.

Weev, the troll who thought hacking the epilepsy site was immoral, is legendary among trolls. He is said to have jammed the cellphones of daughters of C.E.O.’s and demanded ransom from their fathers; he is also said to have trashed his enemies’ credit ratings. Better documented are his repeated assaults on LiveJournal, an online diary site where he himself maintains a personal blog. Working with a group of fellow hackers and trolls, he once obtained access to thousands of user accounts.

I first met Weev in an online chat room that I visited while staying at Fortuny’s house. “I hack, I ruin, I make piles of money,” he boasted. “I make people afraid for their lives.” On the phone that night, Weev displayed a misanthropy far harsher than Fortuny’s. “Trolling is basically Internet eugenics,” he said, his voice pitching up like a jet engine on the runway. “I want everyone off the Internet. Bloggers are filth. They need to be destroyed. Blogging gives the illusion of participation to a bunch of retards. . . . We need to put these people in the oven!”

I listened for a few more minutes as Weev held forth on the Federal Reserve and about Jews. Unlike Fortuny, he made no attempt to reconcile his trolling with conventional social norms. Two days later, I flew to Los Angeles and met Weev at a train station in Fullerton, a sleepy bungalow town folded into the vast Orange County grid. He is in his early 20s with full lips, darting eyes and a nest of hair falling back from his temples. He has a way of leaning in as he makes a point, inviting you to share what might or might not be a joke.

As we walked through Fullerton’s downtown, Weev told me about his day — he’d lost $10,000 on the commodities market, he claimed — and summarized his philosophy of “global ruin.” “We are headed for a Malthusian crisis,” he said, with professorial confidence. “Plankton levels are dropping. Bees are dying. There are tortilla riots in Mexico, the highest wheat prices in 30-odd years.” He paused. “The question we have to answer is: How do we kill four of the world’s six billion people in the most just way possible?” He seemed excited to have said this aloud.

Ideas like these bring trouble. Almost a year ago, while in the midst of an LSD-and-methamphetamine bender, a longer-haired, wilder-eyed Weev gave a talk called “Internet Crime” at a San Diego hacker convention. He expounded on diverse topics like hacking the Firefox browser, online trade in illegal weaponry and assassination markets — untraceable online betting pools that pay whoever predicts the exact date of a political leader’s demise. The talk led to two uncomfortable interviews with federal agents and the decision to shed his legal identity altogether. Weev now espouses “the ruin lifestyle” — moving from condo to condo, living out of three bags, no name, no possessions, all assets held offshore. As a member of a group of hackers called “the organization,” which, he says, bring in upward of $10 million annually, he says he can wreak ruin from anywhere.

We arrived at a strip mall. Out of the darkness, the coffinlike snout of a new Rolls Royce Phantom materialized. A flying lady winked on the hood. “Your bag, sir?” said the driver, a blond kid in a suit and tie.

“This is my car,” Weev said. “Get in.”

And it was, for that night and the next, at least. The car’s plush chamber accentuated the boyishness of Weev, who wore sneakers and jeans and hung from a leather strap like a subway rider. In the front seat sat Claudia, a pretty college-age girl.

I asked about the status of Weev’s campaign against humanity. Things seemed rather stable, I said, even with all this talk of trolling and hacking.

“We’re waiting,” Weev said. “We need someone to show us the way. The messiah.”

“How do you know it’s not you?” I asked.

“If it were me, I would know,” he said. “I would receive a sign.”

Zeno of Elea, Socrates and Jesus, Weev said, are his all-time favorite trolls. He also identifies with Coyote and Loki, the trickster gods, and especially with Kali, the Hindu goddess of destruction. “Loki was a hacker. The other gods feared him, but they needed his tools.”

“I was just thinking of Kali!” Claudia said with a giggle.

Over a candlelit dinner of tuna sashimi, Weev asked if I would attribute his comments to Memphis Two, the handle he used to troll Kathy Sierra, a blogger. Inspired by her touchy response to online commenters, Weev said he “dropped docs” on Sierra, posting a fabricated narrative of her career alongside her real Social Security number and address. This was part of a larger trolling campaign against Sierra, one that culminated in death threats. Weev says he has access to hundreds of thousands of Social Security numbers. About a month later, he sent me mine.

Weev, Claudia and I hung out in Fullerton for two more nights, always meeting and saying goodbye at the train station. I met their friend Kate, who has been repeatedly banned from playing XBox Live for racist slurs, which she also enjoys screaming at white pedestrians. Kate checked my head for lice and kept calling me “Jew.” Relations have since warmed. She now e-mails me puppy pictures and wants the names of fun places for her coming visit to New York. On the last night, Weev offered to take me to his apartment if I wore a blindfold and left my cellphone behind. I was in, but Claudia vetoed the idea. I think it was her apartment.

Does free speech tend to move toward the truth or away from it? When does it evolve into a better collective understanding? When does it collapse into the Babel of trolling, the pointless and eristic game of talking the other guy into crying “uncle”? Is the effort to control what’s said always a form of censorship, or might certain rules be compatible with our notions of free speech?

One promising answer comes from the computer scientist Jon Postel, now known as “god of the Internet” for the influence he exercised over the emerging network. In 1981, he formulated what’s known as Postel’s Law: “Be conservative in what you do; be liberal in what you accept from others.” Originally intended to foster “interoperability,” the ability of multiple computer systems to understand one another, Postel’s Law is now recognized as having wider applications. To build a robust global network with no central authority, engineers were encouraged to write code that could “speak” as clearly as possible yet “listen” to the widest possible range of other speakers, including those who do not conform perfectly to the rules of the road. The human equivalent of this robustness is a combination of eloquence and tolerance — the spirit of good conversation. Trolls embody the opposite principle. They are liberal in what they do and conservative in what they construe as acceptable behavior from others. You, the troll says, are not worthy of my understanding; I, therefore, will do everything I can to confound you.

Why inflict anguish on a helpless stranger? It’s tempting to blame technology, which increases the range of our communications while dehumanizing the recipients. Cases like An Hero and Megan Meier presumably wouldn’t happen if the perpetrators had to deliver their messages in person. But while technology reduces the social barriers that keep us from bedeviling strangers, it does not explain the initial trolling impulse. This seems to spring from something ugly — a destructive human urge that many feel but few act upon, the ambient misanthropy that’s a frequent ingredient of art, politics and, most of all, jokes. There’s a lot of hate out there, and a lot to hate as well.

So far, despite all this discord, the Internet’s system of civil machines has proved more resilient than anyone imagined. As early as 1994, the head of the Internet Society warned that spam “will destroy the network.” The news media continually present the online world as a Wild West infested with villainous hackers, spammers and pedophiles. And yet the Internet is doing very well for a frontier town on the brink of anarchy. Its traffic is expected to quadruple by 2012. To say that trolls pose a threat to the Internet at this point is like saying that crows pose a threat to farming.

That the Internet is now capacious enough to host an entire subculture of users who enjoy undermining its founding values is yet another symptom of its phenomenal success. It may not be a bad thing that the least-mature users have built remote ghettos of anonymity where the malice is usually intramural. But how do we deal with cases like An Hero, epilepsy hacks and the possibility of real harm being inflicted on strangers?

Several state legislators have recently proposed cyberbullying measures. At the federal level, Representative Linda Sánchez, a Democrat from California, has introduced the Megan Meier Cyberbullying Prevention Act, which would make it a federal crime to send any communications with intent to cause “substantial emotional distress.” In June, Lori Drew pleaded not guilty to charges that she violated federal fraud laws by creating a false identity “to torment, harass, humiliate and embarrass” another user, and by violating MySpace’s terms of service. But hardly anyone bothers to read terms of service, and millions create false identities. “While Drew’s conduct is immoral, it is a very big stretch to call it illegal,” wrote the online-privacy expert Prof. Daniel J. Solove on the blog Concurring Opinions.

Many trolling practices, like prank-calling the Hendersons and intimidating Kathy Sierra, violate existing laws against harassment and threats. The difficulty is tracking down the perpetrators. In order to prosecute, investigators must subpoena sites and Internet service providers to learn the original author’s IP address, and from there, his legal identity. Local police departments generally don’t have the means to follow this digital trail, and federal investigators have their hands full with spam, terrorism, fraud and child pornography. But even if we had the resources to aggressively prosecute trolls, would we want to? Are we ready for an Internet where law enforcement keeps watch over every vituperative blog and backbiting comments section, ready to spring at the first hint of violence? Probably not. All vigorous debates shade into trolling at the perimeter; it is next to impossible to excise the trolling without snuffing out the debate.

If we can’t prosecute the trolling out of online anonymity, might there be some way to mitigate it with technology? One solution that has proved effective is “disemvoweling” — having message-board administrators remove the vowels from trollish comments, which gives trolls the visibility they crave while muddying their message. A broader answer is persistent pseudonymity, a system of nicknames that stay the same across multiple sites. This could reduce anonymity’s excesses while preserving its benefits for whistle-blowers and overseas dissenters. Ultimately, as Fortuny suggests, trolling will stop only when its audience stops taking trolls seriously. “People know to be deeply skeptical of what they read on the front of a supermarket tabloid,” says Dan Gillmor, who directs the Center for Citizen Media. “It should be even more so with anonymous comments. They shouldn’t start off with a credibility rating of, say, 0. It should be more like negative-30.”

Of course, none of these methods will be fail-safe as long as individuals like Fortuny construe human welfare the way they do. As we discussed the epilepsy hack, I asked Fortuny whether a person is obliged to give food to a starving stranger. No, Fortuny argued; no one is entitled to our sympathy or empathy. We can choose to give or withhold them as we see fit. “I can’t push you into the fire,” he explained, “but I can look at you while you’re burning in the fire and not be required to help.” Weeks later, after talking to his friend Zach, Fortuny began considering the deeper emotional forces that drove him to troll. The theory of the green hair, he said, “allows me to find people who do stupid things and turn them around. Zach asked if I thought I could turn my parents around. I almost broke down. The idea of them learning from their mistakes and becoming people that I could actually be proud of . . . it was overwhelming.” He continued: “It’s not that I do this because I hate them. I do this because I’m trying to save them.”

Weeks before my visit with Fortuny, I had lunch with “moot,” the young man who founded 4chan. After running the site under his pseudonym for five years, he recently revealed his legal name to be Christopher Poole. At lunch, Poole was quick to distance himself from the excesses of /b/. “Ultimately the power lies in the community to dictate its own standards,” he said. “All we do is provide a general framework.” He was optimistic about Robot9000, a new 4chan board with a combination of human and machine moderation. Users who make “unoriginal” or “low content” posts are banned from Robot9000 for periods that lengthen with each offense.

The posts on Robot9000 one morning were indeed far more substantive than /b/. With the cyborg moderation system silencing the trolls, 4chan had begun to display signs of linearity, coherence, a sense of collective enterprise. It was, in other words, robust. The anonymous hordes swapped lists of albums and novels; some had pretty good taste. Somebody tried to start a chess game: “I’ll start, e2 to e4,” which quickly devolved into riffage with moves like “Return to Sender,” “From Here to Infinity,” “Death to America” and a predictably indecent checkmate maneuver.

Shortly after 8 a.m., someone asked this:

“What makes a bad person? Or a good person? How do you know if you’re a bad person?”

Which prompted this:

“A good person is someone who follows the rules. A bad person is someone who doesn’t.”

And this:

“you’re breaking my rules, you bad person”

There were echoes of antiquity:

“good: pleasure; bad: pain”

“There is no morality. Only the right of the superior to rule over the inferior.”

And flirtations with postmodernity:

“good and bad are subjective”

“we’re going to turn into wormchow before the rest of the universe even notices.”

Books were prescribed:

“read Kant, JS Mill, Bentham, Singer, etc. Noobs.”

And then finally this:

“I’d say empathy is probably a factor.”

http://www.nytimes.com/2008/08/03/ma...3trolls-t.html





Yale Students' Lawsuit Unmasks Anonymous Trolls, Opens Pandora's Box
Ryan Singel

"Women named Jill and Hillary should be raped."

Those are the words of "AK-47" -- a poster to the college-admissions web forum AutoAdmit.com. AK-47 was one of a handful of students heaping misogynist scorn on women attending the nations' top law schools in 2007, in posts so vile they spurred a national debate on the limits of online anonymity, and an unprecedented federal lawsuit aimed at unmasking and punishing the posters.

Now lawyers for two female Yale Law School students have ascertained AK-47's real identity, along with the identities of other AutoAdmit posters, who all now face the likely publication of their names in court records -- potentially marking a death sentence for the comment trolls' budding legal careers even before the case has gone to trial.

The unmasking of the posters marks a milestone in a rare legal challenge to the norms of online commenting, where arguments live on for years in search-engine results and where reputations can be sullied nearly irreparably by anyone with a grudge, a laptop and a WiFi connection. Yet a year after the lawsuit was filed, little else has been resolved -- and legal controversies have multiplied. The women themselves have gone silent, and their lawyers -- two of whom are now themselves being sued -- are not talking to the press. Legal experts are beginning to wonder aloud if there's any point in pressing the messy lawsuit.

"You have good lawyers putting their time in on the case, and in a policy sense, they are achieving something, says Ann Bartow, an associate professor at the University of South Carolina School of Law. "But in a victim sense -- assuming you think of the women as victims -- it's not clear what this is going to achieve."

The AutoAdmit controversy began even before one of the women, identified in court documents as "Jane Doe I," started classes in the fall of 2005, the lawsuit alleges. Doe I was alerted in the summer to an AutoAdmit comment thread entitled "Stupid Bitch to Attend Law School." The thread included messages such as, "I think I will sodomize her. Repeatedly" and a reply claiming "she has herpes." The second woman, Jane Doe II, was similarly attacked beginning in January 2007.

Both women tried in vain to persuade the administrators of the AutoAdmit.com site to remove the threads, according to the lawsuit. But then the story of the cyber-harassment hit the front page of The Washington Post, and the law school trolls became fodder for cable news shows. Soon after, the female law students, with help from Stanford and Yale law professors, filed the federal lawsuit in June 2007 seeking hundreds of thousands of dollars in damages.

The Jane Doe plaintiffs contend that the postings about them became etched into the first page of search engine results on their names, costing them prestigious jobs, infecting their relationships with friends and family, and even forcing one to stop going to the gym for fear of stalkers.

"We have never had such a way to lie and distort facts about people -- to spread lies and distortions in a way that is attached to them," says Bartow. "And you can game it to come up on the front page of Google."

Bartow believes the problem lies in technology outstripping the law and our cultural responses. George Washington University Law Professor Daniel Solove, who's been thinking about the issue long enough to have written a book called The Future of Reputation, agrees. He says the law needs to change.

"The internet isn't a radical-free zone where you can hurt people. But on the other hand, we can't have everyone rushing to the court, because the court is a blunt tool," Solove says. "We need something to help shape norms -- there needs to be some kind of push back against the notion that the internet is a place where you can say what you want and screw the consequences. That's not what free speech is about."

Since libel lawsuits are mostly about clearing one's name, Solove finds himself lamenting the lost ritual of duels, which he describes as an elaborate nonjudicial way of settling disputes that rarely actually got to the shooting phase.

"We don't have any middle-ground dispute resolution processes in society anymore, and courts aren't a good way to vindicate these non-monetary harms," Solove says. "I think we need something else."

One idea gaining traction among legal thinkers would be DMCA-like legislation permitting victims of defamation to issue take-down notices, asking ISPs and websites to remove false and damaging user posts. If the service complies, it would be immune to any legal action.

But that regime hasn't worked entirely well with copyright -- false DMCA notices have been used by everyone from the Pentagon to the psychic Uri Geller to remove content from YouTube.

Jason Schultz, the acting director of the Law, Technology and Public Policy Clinic at UC Berkeley, says it would be a mistake to bring that regime to bear on controversial speech online.

"I think you run the risk of too much take-down," Schultz says. The hurdles and expenses of a court fight act as useful checks on those who would suppress speech, he adds. "I think you need procedural hurdles in place since we are talking about a constitutional right."

Even relying on current liability law, the AutoAdmit case has trod on dangerous ground.

The lawyers for the two women originally named one of AutoAdmit's administrators, Anthony Ciolli, then a third-year law student at the University of Pennsylvania, as a defendant -- even though Congress intentionally shielded electronic service providers from responsibility for what their users post online.

Ciolli's former lawyer, Marc Randazza, says Ciolli never wrote anything defamatory, and was named in the lawsuit simply for leverage, in an effort to get the site owner to change how disturbing material was handled on AutoAdmit.

"As an attorney, I found it really offensive that Ciolli was being held hostage to these people's demands on a third party," says Randazza.

Solove is not nearly as sympathetic.

"Part of reason people were so upset with Anthony Ciolli was that they believe he stuck to his guns and defended things on free speech grounds," Solove says. "People want to see some sort of contriteness."

After months, the Jane Does finally dropped Ciolli from the lawsuit, but that did not satisfy Ciolli, who filed his own lawsuit in March 2008, accusing the women and their lawyers of improperly listing him among those who made the rude comments.

The women's lawyers -- Yale's David Rosen and Stanford's Mark Lemley -- declined repeated requests for comment.

A federal judge ruled in January that the attorneys could serve subpoenas on ISPs and webmail providers. Using that power, the lawyers have unmasked some -- though not all -- of the AutoAdmit posters.

Now they're asking the judge to give them additional time to try and determine the identities of the remaining defendants, who are currently being sued under their AutoAdmit handles: among others, PaulieWalnuts, Cheese Eating Surrender Monkey, The Ayatollah of Rock-n-Rollah, Patrick Bateman and HitlerHitlerHitler.
http://www.wired.com/politics/law/ne...8/07/autoadmit





Google Says "Complete Privacy Does Not Exist"

In a submission to court Google is arguing that in the modern world there can be no expectation of privacy.

Google is being sued by a Pennsylvania couple after their home appeared on Google’s Street View pages. The couple’s house is on a private road clearly marked as private property.

“Today’s satellite image technology means that even in today’s desert, complete privacy does not exist,” says Google’s submission.

“In any event, the Plaintiffs live far away from the desert and are far from hermits.”

The couple are suing Google for US$25,000 in damages, saying that the value of their property has been damaged and say they have suffered “mental stress”.

This is not the first time Google’s Street View has got the company in to trouble. The EU is arguing that people’s faces should be blurred out of images displayed.

The Street View program aims to photograph every street in the world and place the photographs online. A team of specially converted cars with cameras mounted on the roof are in constant action around the world.
http://www.itnews.com.au/News/81523,...not-exist.aspx





Opposed to Wiretap Amnesty? Run a TV Ad for Six Bucks
Sarah Lai Stirland

If you're one of the thousands of voters angry over the Democrats' cave on domestic spying and telecom amnesty, a new online grassroots movement is now making it easy to buy a local ad on MSNBC, CNN and several other networks, for less money than you'd think.

The grassroots group Get FISA Right has created a 30-second spot critical of the surveillance bill passed by Congress earlier this month. It's placed the spot with a Los Angeles startup that buys ad time in bulk from cable providers and resells off slivers to individuals willing to pay for airtime in markets around the country.

The mashup means anyone who supports the repeal of the controversial law can pay online with a credit card to run the advertisement in any of eight cable TV markets around the country. By August 15, 22 markets will be available. The cost of spots varies from six dollars for placement on CNBC between 9 a.m. and 4 p.m. in Cleveland, for example, to $1,856 to run on CNN in New York City between 6 p.m. and midnight.

The wiretap protest movement started life as a group on Barack Obama's social networking site My.BarackObama.com. The group was dedicated to deterring Obama from voting for a measure that legalized President Bush's warrantless wiretapping program and granted retroactive legal immunity to the phone companies that cooperated with the spying when it was illegal. Membership swelled to more than 24,000 ahead of the July vote, but it still failed to deter Obama from supporting the unprecedented expansion of U.S. domestic spying powers.

Determined to keep the debate alive into the next Congress, GetFisaRight is using SaysMe.TV to bring their message to television, 30-seconds at a time.

It's a first for online activists: A netroots invasion of a medium traditionally dominated by deeper pockets like special interest political groups, official political campaigns and corporations. Spots have already been purchased in Charlotte, North Carolina, Dallas and Los Angeles.

Supporters can choose which markets and what time they want the ad to run. SaysMe.TV then submits the ad to the cable company, which takes up to two weeks to approve, making sure that it conforms to the cable network's standards, FCC regulations and federal electioneering law. SaysMe.TV then sends the purchaser of the ad an e-mail 24 hours before the ad runs to tell them exactly what time the spot will appear.

"The value of these ads is that they expose this issue to people who haven't otherwise heard about it," says Jon Pincus, the chief organizer of the effort. "In the aggregate, this effort as a whole has value."

Pincus teamed up with SaysMe.TV and other activists on the group's Wiki to create the 30-second ad.

The point, he says, is to build up enough political clout to change thedebate in races where candidates are running with significant online support. He also hopes to influence Congress and the next administration to revisit the issue of amnesty and domestic spying.

"We care about this issue, we're not going away, we expect things to change, and we expect Congress and the administration to get FISA right," Pincus says.

The group had also encouraged community activists to attend the "listening sessions" organized by the Obama campaign and the Democratic National Committee this month. The sessions were designed to gather grassroots feedback to build the party platform that will be voted on during the convention in August -- though it seems unlikely that the Democratic party will add opposition to a bill it already passed as a plank in its platform.

Now Pincus and other group members are figuring out how to most effectively use the new TV tool.

Pincus says he envisions running anti-amnesty ads in his hometown of Seattle, where Democratic challenger and netroots favorite Darcy Burner is running for Congress. Burner was against the telecom immunity legislation, and Pincus says that running some ads might help to publicize that fact and turn out supporters for her.

Lisa Eisenpresser, SaysMe.TV's CEO, calls her service a "vending machine" for cable TV slots. And unlike direct political contributions, there's no spending limit for TV ads -- though she says that the company reports customers' payment information to the Federal Election Commission whenever an ad promotes a particular candidate.

SaysMe.TV and Spotrunner, a similar service, make the most sense for issue groups such as Pincus' FISA group, rather than for political candidates, says Phil de Vellis, a senior associate and vice president for the Democratic political advertising firm Murphy Putnam Media. That's because political candidates still want to generally rely on the expertise of professionals with demographic and voting data to wring the most bang out of their advertising bucks.
http://blog.wired.com/27bstroke6/200...p-of-demo.html





New Video Surveillance Technology 'Recognizes' Abnormal Activity

BRS software can establish 'normal' on-camera activity – and alert security staff when something unusual occurs
Tim Wilson

The problem with video surveillance cameras is that, usually, there are too many of them for one security staffer to monitor. In a typical large enterprise setup, a single officer might be monitoring dozens -- even hundreds -- of cameras simultaneously, making it impossible to immediately recognize suspicious activity.

"To be honest, it's sheer luck if a security officer spots something in an environment like that," says John Frazzini, a former U.S. Secret Service agent and IT security consultant. "If you get a security manager alone behind closed doors, a lot of them laugh about what a waste of money it is."

Frazzini recently signed on to serve as president of a new company -- Behavioral Recognition Systems, or BRS Labs for short -- that aims to stop that waste. BRS Labs, which is launching both its business and its technology today, has received 16 patents on a new video surveillance application that can convert video images into machine-readable language, and then analyze them for anomalies that suggest suspicious behavior in the camera's field of view.

Unlike current video surveillance gear -- which requires a human to monitor it or complex programming that can't adapt to new images -- BRS Labs's software can "learn" the behavior of objects and images in a camera's field of view, Frazzini says. It can establish "norms" of activity for each camera, then alert security officers when the camera registers something abnormal in its field of view.

"It works a lot like the behavioral software that many IT people use on their networks," Frazzini says. "It establishes a baseline of activity, and then sends alerts when there are anomalies. The big difference is that, until now, there was no way to do this kind of analysis on video images, because the data collected by the cameras wasn't machine readable. We had to invent a way to do that."

The BRS Labs software can establish a baseline in anywhere from 30 minutes to several hours, depending on how much activity the camera recognizes and how regular the patterns of behavior are. "If you're monitoring a busy highway, where traffic comes and goes frequently on a regular basis, [the software] learns very quickly," Frazzini says. "If you're monitoring an outdoor fence line when the camera sees only three or four actions all day, it will take longer."

Once the software is operational, it can "recognize" up to 300 objects and establish a baseline of activity. If the camera is in a wooded area where few humans ever go, it will alert officers when it registers a human on the screen. If it is monitoring a high fence line, it will send an alert when someone jumps the fence.

"The great thing about it is that you don't need a human to monitor the camera at all," Frazzini says. "The system can recognize the behavior on its own."

Because there are so many possible images that might cross in front of the camera, the BRS Labs technology will likely create a fair number of false positives, Frazzini concedes. "We think a three-to-one ratio of alerts to actual events is what the market will accept," he says. "We could be wrong."

Overall, however, the new technology should save enterprises money, because security officers can spend their time diagnosing alerts and less time watching their screens for anomalies. And the system is more accurate than human monitoring, he says.

"What we've seen so far is enterprises spending billions on video surveillance equipment, but having a lot of trouble proving a [return on investment]," Frazzini says. "What we're doing is helping them to get more out of that equipment."

The BRS Labs technology will be generally available in September. Pricing hasn't been finalized -- early implementations have ranged anywhere from $1,500 to $4,500 per camera.
http://www.darkreading.com/document.asp?doc_id=160068





Face Swapper Software Protects Privacy
Mark Frauenfelder

Kevin Kelly writes about software created by Dmitri Bitouk and Neeraj Kumar of Columbia University that "de-indentifies" people in photos to protect their privacy.

Face swapping software finds faces in a photograph and swaps the features in the target face from a library of faces. This can be used to "de-identify" faces that appear in public, such as the faces of people caught by the cameras of Google Street View. So instead of simply blurring the face, the software can substitute random features taken from say Flickr's pool of faces. A mouth here, an eye there.

Face Swapper Privacy (Conceptual Trends and Current Topics)
http://www.boingboing.net/2008/07/29...r-softwar.html





Citizens Use YouTube to Keep Gov't in Check

Watching the watchers
Nick Heath

Citizens are used to CCTV surveillance but a parliamentary group says that cameras are being turned on governments to keep them in line.

"Sous-veillance" will see video sharing sites such as YouTube used by citizens to shine a spotlight on things such as deadly hygiene lapses in hospital wards and uncollected rubbish, according to the European Information Society Group (Eurim).

The vision of the "public monitoring the state" and shaming them into action using cameraphones is one of several key ways that Eurim says technology can be used to transform government and empower the public.

Its report says: "New web applications such as YouTube or Patient Opinion enable people to monitor the state and to be heard. People can easily post videos of dirty hospital wards, of uncollected rubbish or of pot holes in the road, to a world-wide audience.

"Sous-veillance might transform political engagement due to its ease of use, by engaging even the time-poor majority and extending citizenship beyond the usual special interest groups."
http://www.silicon.com/publicsector/...9266049,00.htm





Bill Would Ban Kids from Facebook, MySpace in Libraries
Ledyard King

Congress is considering a bill that would bar children who use computers in public libraries from accessing Facebook and other social networking websites without parental permission.

Rep. Mark Steven Kirk, the Illinois Republican who sponsored the measure, says the proposal would keep sexual predators from contacting minors who are using a library computer.

But the American Library Association says Kirk's bill is yet another attempt by the federal government to interfere with library users' privacy and free speech.

"If people in a community do not feel confident that their privacy will be protected, they cannot use the library as it was intended, for intellectual pursuit," said Emily Sheketoff, who heads the association's Washington office. "It will intimidate them."

It's the latest in a series of battles the association has been fighting with Congress over the past decade. Some highlights:

•In 2000, lawmakers required libraries receiving federally discounted Internet service to install devices to filter out obscene material. Libraries sued, but the Supreme Court upheld the law.

•A year later, following the 2001 terrorist attacks, Congress passed the USA Patriot Act, giving federal authorities more power to track the books and videos library patrons borrow and the websites they visit.

Despite objections from the American Library Association, the act was renewed in 2006 without significant changes, other than a requirement that authorities take extra steps in justifying their need for the records.

Supporters of the law note that two of the 2001 hijackers bought their plane tickets using a public computer at a New Jersey college library and that other members of the plot surfed the Internet using a computer at a public library in Delray Beach, Fla.

Earlier this year, a federal magistrate judge in Atlanta ruled the FBI did not violate the privacy of a Pakistani national in 2006 by logging onto the same computer the Pakistani has used and looking up which websites he had visited. Agents said the man was part of a terrorism plot.

•In 2007, the American Library Association helped persuade Congress to reopen several Environmental Protection Agency libraries the Bush administration had closed. The closures "created a serious obstacle to the public's ability to gather information about key environmental issues," according to the association.

•Kirk's bill, the Deleting Online Predators Act, died in 2006 but gained new life this year.

Kirk says that as more children flock to social networking sites like MySpace and Facebook, "we've seen a corresponding increase of online sexual predators" targeting those children.

But library officials say the legislation — while tackling a legitimate problem — takes the wrong approach in trying to keep kids safe from online predators.

Rather than outlawing certain sites, the American Library Association supports preparing kids and parents to deal with online threats at the library, home or anywhere else.
http://www.usatoday.com/tech/news/te...omputers_N.htm





Scrabulous Barred to North American Users
Heather Timmons

“Boycott Hasbro!”

The rallying cry started early Tuesday after fans of Scrabulous, an online knockoff of the classic board game Scrabble, woke up to find that their game had been abruptly removed from Facebook.com, the social networking site.

To make matters worse, people who tried to download the official Hasbro version of Scrabble found that it did not work either. The authorized game had been the victim of “a malicious attack” on Tuesday morning, its developer said — an attack that came right on the heels of the sudden disappearance of Scrabulous.

Electronic Arts, the video game company that wrote the online Scrabble program for Hasbro, said it was investigating the apparent hacking of its application, and pointed no fingers for the moment. “We’re working with our partners to have Scrabble back online and ready to play as soon as possible,” the company said.

The demise of Scrabulous was sudden but not wholly unexpected. The game, a favorite time-waster among cubicle dwellers, was created by two brothers in Calcutta. On July 24, Hasbro, which owns the North American rights to Scrabble, sued them for copyright infringement. On Tuesday, the brothers made Scrabulous unavailable to Facebook users in Canada and the United States, citing legal pressure.

The backlash was instant. Bloggers denounced Hasbro, howls of protest flooded message boards, and new Facebook groups were created with names like “Down with Hasbro.” Although some people spoke up to defend Hasbro’s rights, most people jeered at the company, calling it everything from “short-sighted” to “technologically in the dark” to “despicable.”

“You didn’t have the smarts or initiative to come up with as good a product at the boys did, so your alternative is to mess with the superior product?” said one typical comment on Facebook. “Do you think that the thousands of folks who were enjoying this superior application will now come running to your inferior product? Hmmmm.... BOYCOTT HASBRO!!!”

Hasbro, for its part, was keeping a stiff upper lip. It issued a statement on Tuesday inviting fans to try out the “authentic” game of online Scrabble, introduced this month by Electronic Arts.

But on Tuesday, people who downloaded Electronic Arts’ “Scrabble Beta” were greeted with a message that said, “We’ll be back up shortly.” On Tuesday afternoon, Electronic Arts said that technical problems had caused the crash; by early evening the company said that its game had “experienced a malicious attack this morning, resulting in the disabling of Scrabble on Facebook.”

Scrabble Beta had attracted about 15,000 daily users and mixed reviews, including criticism from Facebook reviewers for its “pathetic” upload time. The companies said they were trying to address such issues.

“In deference to the fans, we waited in pursuing legal action until Electronic Arts had a legitimate alternative available,” Hasbro said in its statement. Hasbro’s public relations department did not respond to calls and e-mail seeking further comment.

Scrabulous, created by the Indian software developers Rajat and Jayant Agarwalla, had attracted more than half a million players a day worldwide on Facebook. But Hasbro sued the brothers last week in New York for “clear and blatant infringement” of its intellectual property, so they decided to pull the plug.

“In deference to Facebook’s concerns and without prejudice to our legal rights, we have had to restrict our fans in U.S.A. and Canada from accessing the Scrabulous application on Facebook until further notice,” the brothers said in a statement.

While Hasbro owns the rights to Scrabble in North America, Mattel owns the rights everywhere else. For now, Scrabulous remains available to Facebook users outside North America.

Both Hasbro and Mattel introduced Facebook versions of Scrabble to compete with Scrabulous this year, but neither one attracted the users or praise of Scrabulous. The Agarwallas put the game on Facebook in 2007, and it quickly became a hit, attracting millions of users.

Scrabulous fans have been vehement in supporting the Agarwallas, and thousands have already signed petitions vowing not to buy Mattel or Hasbro products if Scrabulous is removed.

By Tuesday evening, Scrabulous fans had organized new protests and petitions. A user group, Scrabble Boycott, called on Facebook members to refuse to play the official version of Scrabble. “Wait this out,” the leader of the group urged.

Brad Stone contributed reporting.
http://www.nytimes.com/2008/07/30/te...0scrabble.html





'Scrabulous' Gets a Nip-Tuck, Returns as 'Wordscraper'
Caroline McCarthy

In the high school cafeteria of Facebook apps, Scrabulous is like that girl who gets in trouble for showing too much skin, only to throw on a hoodie and be let back into the principal's good graces. Sort of. The game has effectively returned, but with a redesigned board, a few original play options, a different points tabulation system, and a new name, Wordscraper.

Props to Adam Ostrow of Mashable for picking up on this one early.

The Facebook application Scrabulous had been taken down by its creators earlier this week when Hasbro, the game manufacturer that owns the rights to Scrabble in the U.S. and Canada, pointed out that Scrabulous was a near copy. Few disagreed with the allegation, but many loyal Scrabulous fans wondered why Hasbro couldn't have struck a deal instead of insisting upon a shutdown, especially as the "real" Scrabble game on Facebook succumbed to technical difficulties.

The reason for Scrabulous' extreme makeover has its roots in some pretty gray legal matters: the real problem wasn't that it ripped off Scrabble, but that it ripped off Scrabble so blatantly. The colors of the board were the same, the list of rules led to a Wikipedia entry for Scrabble rules, and the two names were similar enough for Hasbro to cry foul.

On Wednesday I spoke to Pete Kinsella, a partner at the Faegre & Benson law firm who specializes in intellectual property, and he gave me his take on the gritty details. "Copyrights are not supposed to protect board games," Kinsella explained. "What copyrights protect is the expression of an idea rather than the idea itself."

Returning as Wordscraper is a way for its creators to keep the game running while avoiding legal complaints. In effect, it's just different enough.

"I think there's a very fine line to walk in this one, and the question is whether Scrabulous went over the line or not in mimicking the colors or everything else," Kinsella assessed (keep in mind that we had this conversation before the advent of Wordscraper), "or whether they could've designed a generic version of the game with the same points system and scoring system, and that would've fallen out of Hasbro's copyrights."

So will this end the legal spat? Maybe. If Kinsella's analysis proves accurate, this is probably enough to keep Hasbro's lawyers away. Many other games on Facebook bear strong-but-not-too-strong resemblances to board games like Battleship and Risk, but so far haven't encountered the same corporate scrutiny.

"The law allows people to design around things, and particularly when there isn't patent protection, the law has great incentive to design around things by making things somewhat different," Kinsella said.

Or, for a less digital example, think about all those detergent bottle logos that look suspiciously similar.
http://news.cnet.com/8301-13577_3-10003366-36.html





Facebook 'Stabbing' Game Removed
Mark Sweney

A Facebook game that lets users 'shank' each other - street slang for stabbing - has been removed following complaints from anti-knife crime campaigners.

The virtual "shank" appears as an icon within the Facebook Superpoke! application.

Superpoke! allows users to send virtual actions to other users such as smile, wink, take part in the Tour de France or send a bouquet.

Although the application consists of mostly humorous actions, some of the options, such as smack, slap and shank, have darker connotations.

When the knife icon is sent to a Facebook friend they receive a message saying that they have been "shanked".

The application, made by US firm Slide for Facebook users, has now been removed from the social networking website.

Superpoke! and Facebook came in for criticism in today's Sun. The uncle of Rob Knox, the Harry Potter actor who died after being stabbed in May, told the paper that the application "incited violence".

Anti-knife campaign group Urban Concepts condemned the shank application, branding it "appalling".

"The story refers to an application called Superpoke! made by Slide," said a spokeswoman for Facebook. "Slide have actually removed the 'shank' option from Superpoke!."
http://www.guardian.co.uk/media/2008...ebook.facebook





China to Limit Web Access During Olympic Games
Andrew Jacobs

The International Olympic Committee failed to press China to allow fully unfettered access to the Internet for the thousands of journalists arriving here to cover the Olympics, despite promising repeatedly that the foreign news media could “report freely” during the Games, Olympic officials acknowledged Wednesday.

Since the Olympic Village press center opened Friday, reporters have been unable to access scores of Web pages — among them those that discuss Tibetan issues, Taiwanese independence, the violent crackdown on the protests in Tiananmen Square and the Web sites of Amnesty International, the BBC’s Chinese-language news, Radio Free Asia and several Hong Kong newspapers known for their freewheeling political discourse.

The restrictions, which closely resemble the blocks that China places on the Internet for its citizens, undermine sweeping claims by Jacques Rogge, the International Olympic Committee president, that China had agreed to provide full Web access for foreign news media during the Games. Mr. Rogge has long argued that one of the main benefits of awarding the Games to Beijing was that the event would make China more open.

“For the first time, foreign media will be able to report freely and publish their work freely in China. There will be no censorship on the Internet,” Mr. Rogge told Agence France-Presse just two weeks ago.

But a high-ranking Olympic committee official said Wednesday that the panel was aware that China would continue to censor Web sites carrying content that the Chinese propaganda authorities deemed harmful to national security and social stability. The panel acquiesced to China’s demands to maintain such controls, said the official, who spoke on condition of anonymity because he was not the designated public spokesman for the International Olympic Committee.

It was not immediately clear if China had provided special Internet links for overseas journalists working at the press center in the Olympic Village. But Chinese officials, speaking about the Internet restrictions on Wednesday, said they would not allow foreign journalists to visit Web sites that violated Chinese laws.

In its negotiations with the Chinese over Internet controls, the Olympic committee official said, the panel insisted only that China provide unregulated access to sites containing information useful to sports reporters covering athletic competitions, not to a broader array of sites that the Chinese and the Olympic committee negotiators determined had little relevance to sports.

The official said he now believed that the Chinese defined their national security needs more broadly than the Olympic committee had anticipated, denying reporters access to some information they might need to cover the events and the host country fully. This week, foreign news media in China were unable to gain direct access to an Amnesty International report detailing what it called a deterioration in China’s human rights record in the prelude to the Games.

“We are quite stunned by the decision, but we will survive this mess,” the official said. Sandrine Tonge, the media relations coordinator for the committee, said it would press the Chinese authorities to reconsider.

Chinese officials initially suggested that any troubles journalists were having with Internet access probably stemmed from the sites themselves, not any steps that China had taken to filter Web content. But Sun Weide, the chief spokesman for the Beijing Olympic organizing committee, acknowledged Wednesday that journalists would not have uncensored Internet use. “It has been our policy to provide the media with convenient and sufficient access to the Internet,” Mr. Sun said. “I believe our policy will not affect reporters’ coverage of the Olympic Games.”

Mr. Sun said foreigners using the Internet in China would be subject to the same laws under which censors blocked access to a wide range of Web sites thought to be detrimental to stability. China has long maintained that its laws governing Internet access do not amount to censorship and are similar to restrictions on pornography or gambling sites in many countries.

The restrictions were the latest in a string of problems that have tarnished the prelude to the Olympics, which open Aug. 8. China struggled to contain ethnic unrest in Tibetan areas this spring. The global torch relay that China organized to promote the Games was disrupted by protests. Air pollution in Beijing has remained severe despite efforts to reduce it.

In recent months, human rights advocates have accused Beijing of stepping up the detention and surveillance of those it fears could disrupt the Games. On Tuesday, President Bush met with five Chinese dissidents at the White House to drive home his dissatisfaction with the pace of change. Mr. Bush, who will attend the opening ceremonies in just over a week, also pressed China’s foreign minister to ease political repression.

The White House also urged China to lift its restrictions on the Internet. “We want to see more access for reporters, we want to see more access for everybody in China to be able to have access to the Internet,” the White House press secretary, Dana Perino, said Wednesday.

On Capitol Hill, Senator Sam Brownback, Republican of Kansas, introduced a resolution on Tuesday urging China to reconsider what he said were its plans to force international hotel chains to track electronic communications by its guests. At a news conference, he introduced redacted documents that he said were provided by the hotels requiring them to install government software to monitor Internet traffic during the Olympics.

Concerns about media access to the Internet intensified Tuesday, when Western journalists working at the Main Press Center in Beijing said they could not get to Amnesty International’s Web site to see the group’s report on China’s rights record.

T. Kumar, Amnesty International’s Asia advocacy director, said he thought the government hoped it could dissuade reporters from pursuing stories about human rights issues by blocking their access to Internet-based information. “This sends the wrong message not only to journalists but to anyone on his or her way to the Olympics,” he said.

It was not clear how hard Olympic committee officials pushed for open access to the Internet during negotiations with the Chinese, which dated from to the decision to award Beijing the Games in 2001, or why Mr. Rogge, the Olympic chief, promised that the news media would have uncensored access during the Games when officials working for him were aware that China would keep at least some of its censorship policies in place.

Kevan Gosper, press chief of the International Olympic Committee, was quoted by Reuters on Wednesday as saying that I.O.C. officials had agreed that China could block sites that would not hinder reporting on the Games themselves. “I also now understand that some I.O.C. official negotiated with the Chinese that some sensitive sites would be blocked on the basis they were not considered Games-related,” he told Reuters.

The senior Olympic committee official said the committee pressed hardest for unfiltered access to sites that sports reporters would need to cover athletic competitions. He said such sites included some that had been blocked in China in the past, including Wikipedia, but did not include political sites run by groups that the Beijing government considers hostile, like the spiritual sect Falun Gong.

Jonathan Watts, president of the Foreign Correspondents Club of China, said he was disappointed that Beijing had failed to honor its agreement to temporarily remove the firewall that prevented Chinese citizens from fully using the Internet.

“Obviously if reporters can’t access all the sites they want to see, they can’t do their jobs,” he said. “Unfortunately such restrictions are normal for reporters in China, but the Olympics were supposed to be different.”
http://www.nytimes.com/2008/07/31/sp...s/31china.html





IOC to Probe Apparent Internet Censorship
Nick Mulvenney

The International Olympic Committee (IOC) will investigate apparent censorship of the Internet service provided for media covering the Beijing Olympics, press chief Kevan Gosper said on Tuesday.

China, which has promised media the same freedom to report on the Games as they enjoyed at previous Olympics, loosened its regulations governing foreign media in January last year.

Despite these new regulations, which are scheduled to expire in October, foreign media in China have complained of continuing harassment by officials and Human Rights Watch released a report earlier this month saying China was not living up to its pledges.

Attempts to use the Internet network at the Main Press Centre to access the website of Amnesty International, which released a report on Monday slamming China for failing to honour its Olympic human rights pledges, proved fruitless on Tuesday.

Gosper said the IOC would look into anything that interfered with reporters doing their jobs in reporting the Games.

"All of these things are a concern and we'll investigate them but our preoccupation is that the media are able to report on the Games as they did in previous Games," he told Reuters.

"Where it's not happening, we'll take the matter up with BOCOG and the authorities immediately," he said, referring to the Beijing Olympic organisers."

Chinese Foreign Ministry spokesman Liu Jianchao said media should be able to access the Internet as usual but he also conceded that sites related to Falun Gong, the spiritual movement China considers a cult, would be blocked.

"As to sites related to Falun Gong, I think you know that Falun Gong is a cult that has been banned according to law, and we will adhere to our position," Liu told a news conference.

He suggested that difficulties accessing certain websites could be the fault of the sites themselves.

"There are some problems with a lot of websites themselves that makes it not easy to view them in China," Liu said.

"Our attitude is to ensure that foreign journalists have regular access to information in China during the Olympic Games."

The Games officially open on August 8 but the Athletes' and Media Villages are up and running and the Main Press Centre and International Broadcast Centre are already teeming with some of the more than 20,000 media accredited to cover the event.

"As I've said before, this is a country that does have censorship within its media, but we've been guaranteed free access, open media activity for media reporting on the Olympic Games at Games time," Gosper said. "We are now in Games time."

Gosper also said that there had been complaints that the Internet service provided for media was too slow.

"We're looking into that and we've tracked that information into BOCOG immediately because free access to the Internet also means normal speed," he said.

But Gosper, making his first tour of the press centre since his arrival from Australia, said he was pleased with how things looked with just 10 days to go.

"The build-up is always nervous but so far, so good."

(Additional reporting by Lindsay Beck, Editing by Nick Macfie)
http://uk.news.yahoo.com/rtrs/200807...a-566e283.html





China Eases Internet Restrictions for Journalists
Andrew Jacobs

The Chinese authorities, bowing to criticism from Olympic officials, foreign journalists and Western political leaders, have lifted some of the restrictions that blocked Web sites at the main press center for the Games, although other politically sensitive sites remained inaccessible Friday.

The government made no announcement about the partial lifting of its firewall, and it was unclear if the change would be temporary. The International Olympic Committee also sought Friday to counter statements by its top press official, who had suggested that IOC negotiators had quietly acquiesced to the government’s restrictions.

Giselle Davies, a spokeswoman for the IOC, said the contradictory versions of events were the result of a misunderstanding, and she stressed that the committee has always been adamant about unfettered Internet access for the 20,000 foreign journalists who will be covering the Games.

The loosening of restrictions, however limited, came after senior IOC officials spoke with China’s Olympic organizers on Thursday and urged them to reconsider their decision to ban some politically provocative sites. Critics said even a partial ban violated the host country’s pledge to provide uncensored Internet access to journalists, a promise that helped Beijing win the right to hold the Games.

Sun Weide, a spokesman for the Beijing organizing committee, declined to confirm whether there had been a change in policy. “We are fulfilling a promise to provide good working conditions for reporters covering the Olympic Games,” he said in a telephone interview. “Internet access is sufficient and convenient.”

Access to sites the government normally blocks expanded throughout the day Friday. The first sites unblocked included those of Amnesty International, Human Rights Watch, Radio Free Asia and the Chinese language service of the BBC. By early evening, reporters at the press center could read about topics that have long been taboo here: Taiwanese independence, jailed Chinese dissidents, and the 1989 crackdown on protesters in Tiananmen Square. Other sites, particularly those that mention Falun Gong, the banned spiritual movement, remained off limits.

Until now, the Chinese authorities had remained resolute that their Internet restrictions would not hamper coverage of the Games. And Mr. Sun has repeatedly said that visiting reporters should not expect access to Web sites containing information that is “in breach of Chinese law.”

T. Kumar, Asia advocacy director for Amnesty International, said he was pleased that previously blocked sites were available, but he was skeptical they would remain so. “We urge the International Olympic Committee to exert pressure on China so that those attending the Games — and ordinary Chinese citizens — can enjoy freedom of expression and movement,” he said.

Although the conflict over Internet access for journalists seems to have been defused for now, it remains unclear how the so-called misunderstanding between the IOC and the Chinese government went unaddressed for so long.

In an interview with The Australian newspaper, Kevan Gosper, the chief of the IOC press commission and a former Olympic runner from Australia, maintained his position that high-level IOC colleagues had bowed to China’s Internet restrictions. He accused the organization of secretly agreeing to the policy change and then continuing to publicize the idea that China would not censor the Internet for reporters covering the Games.

“It has dented my reputation quite seriously,” Mr. Gosper said. “People take me at my word, so I expect the information I am giving to be consistent.”

Juliet Macur contributed reportingfrom Beijing.
http://www.nytimes.com/2008/08/02/sp...02beijing.html





Those Privacy-Hating Chinese Communist Tyrants
Glenn Greenwald

Associated Press, yesterday:

Foreign-owned hotels in China face the prospect of "severe retaliation" if they refuse to install government software that can spy on Internet use by hotel guests coming to watch the summer Olympic games, a U.S. lawmaker said Tuesday.

Sen. Sam Brownback, R-Kan., produced a translated version of a document from China's Public Security Bureau that requires hotels to use the monitoring equipment. . . . .

Brownback said several international hotel chains confirmed receiving the order from China's Public Security Bureau. The hotels are in a bind, he said, because they don't want to comply with the order, but also don't want to jeopardize their investment of millions of dollars to expand their businesses in China.

Rocky Mountain News, October 11, 2007:

The National Security Agency and other government agencies retaliated against Qwest because the Denver telco refused to go along with a phone spying program, documents released Wednesday suggest. . . .

The secret contracts -- worth hundreds of millions of dollars -- made [Qwest CEO Joseph] Nacchio optimistic about Qwest's future, even as his staff was warning him the company might not make its numbers, Nacchio's defense attorneys have maintained. . . .

Nacchio planned to demonstrate at trial that he had a meeting on Feb. 27, 2001, at NSA headquarters at Fort Meade, Md., to discuss a $100 million project. According to the documents, another topic also was discussed at that meeting, one with which Nacchio refused to comply.

The topic itself is redacted each time it appears in the hundreds of pages of documents, but there is mention of Nacchio believing the request was both inappropriate and illegal, and repeatedly refusing to go along with it.

The NSA contract was awarded in July 2001 to companies other than Qwest.

USA Today reported in May 2006 that Qwest, unlike AT&T and Verizon, balked at helping the NSA track phone calling patterns that may have indicated terrorist organizational activities. Nacchio's attorney, Herbert Stern, confirmed that Nacchio refused to turn over customer telephone records because he didn't think the NSA program had legal standing.

In the documents, Nacchio also asserts Qwest was in line to build a $2 billion private government network called GovNet and do other government business, including a network between the U.S. and South America.

For my podcast show later today, I spoke with Tim Shorrock, the investigative journalist who has become the leading expert on the enormous, sprawling and rapidly growing consortium between the U.S. Government and private corporations (including the telecom industry) with regard to how intelligence, surveillance and defense activities of the U.S. Government are now carried out. The vast bulk of America's surveillance state and intelligence activities (budgeted at roughly $70 billion each year) are now outsourced to and performed by these private corporations. The precise financial dynamic which Sen. Brownback is impotently protesting in China -- that corporations are highly incentivized to assent to and enable all government spying lest they lose extremely lucrative government contracts (and, conversely, that they're eager to cooperate with the Government in order to receive more contracts and become further integrated in government activities) -- is exactly the dynamic that drives America's surveillance state.

Indeed, it was that very substantial profit motive -- as the Rocky Mountain News article above illustrates -- that led American telecoms in the U.S. not just to acquiesce to, but eagerly embrace, the Bush administration's desire to spy illegally on their customers' telephone and email communications. Those who agreed to help the Government break the law received far more of the billions and billions of dollars of government surveillance and defense contracts, while Qwest -- by refusing the Bush administration's requests for illegal spying -- was punished by being frozen out of this private-public consortium.

More inanely still, Sen. Brownback is specifically outraged by the intrusive spying activities in which the Chinese Government plans to engage with regard to the telephone and email communications of foreign visitors. From yesterday's AP article:

"These hotels are justifiably outraged by this order, which puts them in the awkward position of having to craft pop-up messages explaining to their customers that their Web history, communications, searches and key strokes are being spied on by the Chinese government," Brownback said at a news conference. . . .

Earlier this year, the U.S. State Department issued a fact sheet warning travelers attending the Olympic games that "they have no reasonable expectation of privacy in public or private locations" in China.

"All hotel rooms and offices are considered to be subject to on-site or remote technical monitoring at all times," the agency states. . . .

"If you were a human rights advocate, if you're a journalist, you're in room 1251 of a hotel, anything that you use, sending out over the Internet is monitored in real time by the Chinese Public Security bureau," Brownback said. "That's not right. It's not in the Olympic spirit."

Brownback and other lawmakers have repeatedly denounced China's record of human rights abuses and asked President Bush not to attend the Olympic opening ceremonies in Beijing.

Brownback was introducing a resolution in the Senate on Tuesday that urges China to reverse its actions.

That's the same Sen. Sam Brownback who voted last year to enact the Protect America Act, which "allow[ed] for massive, untargeted collection of international communications without court order or meaningful oversight by either Congress or the courts. It contain[ed] virtually no protections for the U.S. end of the phone call or email, leaving decisions about the collection, mining and use of Americans' private communications up to this administration." And it's the same Sen. Brownback who also voted for this year's FISA Amendments Act, which empowers the U.S. Government to tap directly into the U.S. telecommunications systems in order to monitor international emails and telephone calls with no individual warrant required.

The idea that the U.S. can exert meaningful leverage on China's surveillance behavior is laughable for reasons wholly independent of what the U.S. Government itself does with regard to spying on its own citizens. Nonetheless, to watch U.S. Senators like Sam Brownback actually maintain a straight face while protesting China's warrantless spying on the email and telephone communications of foreigners, and lamenting that private companies feel unfairly pressured to cooperate with China's government spying out of fear of losing lucrative business opportunities, is so surreal that it's actually hard to believe one is seeing it. How many days do we have to wait before we get to read a righteous Fred Hiatt Editorial condemning China's Communist tyrants for their outrageous spying intrusions? Maybe Jay Rockefeller can co-sponsor Brownback's Senate Resolution condemning China's surveillance activities and demanding that they stop it at once.
http://www.salon.com/opinion/greenwa...ina/index.html





Video Websites 'Must Vet Content'
BBC

YouTube has been criticised by MPs, who say it must do more to vet its content.

In a review of net safety, the Culture, Media and Sport select committee said a new industry body should be set up to protect children from harmful content.

It also said it should be "standard practice" for sites hosting user-generated content to review material proactively.

YouTube's owners said the site had strict rules and a system that allowed users to report inappropriate content.

The committee also wants a rethink on how best to classify video games - but there is disagreement over who should run the new ratings system.

MPs say the same body which gives age ratings to films - the British Board of Film Classification - should be in charge, but the games industry supports its own voluntary code.

Effective

In its report, the committee said that some websites it had monitored as part of its review had a "lax" approach to removing illegal content.

It said it was "shocked" that the industry standard for removing child abuse images was 24 hours.

Google, the firm which owns YouTube, said it was confident the video-sharing site was safe for children.

"We have strict rules on what's allowed, and a system that enables anyone who sees inappropriate content to report it to our 24/7 review team and have it dealt with promptly," said a spokesman.

A direct link from every YouTube page makes the process easy, he added.

"Given the volume of content uploaded on our site, we think this is by far the most effective way to make sure that the tiny minority of videos that break the rules come down quickly," he said.

The committee acknowledged that the volume of content on sites such as YouTube - which has 10 hours of videos uploaded every minute - made it unrealistic to watch every video before it went online.

But, it said that the practice of removing clips only after they are flagged up by users was not working either.

Dark side

Self regulation had resulted in an "unsatisfactory piecemeal approach which lacks consistency and transparency," the committee concluded.

While it recommended the creation of an industry body responsible for policing the web, it stopped short of making regulation mandatory.

The body - likely to be known as the child internet safety council - will be set up later this year.

"The internet has transformed our lives and is overwhelmingly a force for good. However there is a dark side and many parents are rightly anxious," said committee chairman John Whittingdale.

A clip of a gang rape on YouTube was used as one example of the "dark side" of the net.

Other sites which promote extreme diets, self-harm and suicide were also cited.
http://news.bbc.co.uk/2/hi/technology/7533543.stm





ISPs Crucial to Child Pornography Blocks
Fran Foo and Andrew Colley

THE Federal Government's internet service provider-level web filtering regime could kick off in earnest next year.

The Government yesterday released the findings of its much-anticipated report on a service provider-level web filtering trial conducted in Tasmania by the Australian Communications and Media Authority.

The trial was conducted within parameters set out in June 2007 by the previous government, when Helen Coonan was communications minister.

Enex TestLab was awarded a tender in January to conduct the closed trials, which were completed in June. They were held at Telstra's broadband lab without input from the telco, the authority said.

Twenty-six ISP-based web filtering products were submitted for review but only six made the final cut.

The results were mixed. Most filters could not identify illegal or inappropriate content - as defined by the authority - using most non-web protocols.

This meant content delivered from a channel such as instant messaging would be permitted.

Between 88 per cent and 97 per cent of illegal and inappropriate content that should have been blocked was blocked, the report said.

The authority said tests undertaken showed an improvement over older technologies used in a 2005 trial. "The median rate of successful blocking was improved from the previous trial," it said.

A spokesman for Communications Minister Stephen Conroy said the next step would be to assess the performance of the filtering products in a live pilot in the second half of the year.

"The next step is a test with a number of ISPs and internet users," Senator Conroy said.

The findings were welcomed in some quarters, but service providers were cautious.

Child Wise chief executive Bernadette McMenamin said her child-protection organisation supported the Government's move to filter the web but only under strict guidelines.

"We totally support the Federal Government's filtering plans but it must not go beyond child pornography. If adult content gets blocked as well, that wouldn't work," Ms McMenamin said.

"As a child protection agency we want ISPs to block child pornography but not any other form of pornography," she said.

ContentKeeper, a Canberra firm that took part in the trial, said ISP-based web filtering was good but "there are always going to be ways to bypass filters, such as using anonymous proxy servers".

ContentKeeper chief executive Geoff Wood said ISP-level filtering was only one piece of the puzzle. "Parents must do all they can to keep their children safe on the web."

Service providers have in the past resisted calls to take part in ISP-level filtering, citing concerns that they will be placed in the position of policing the internet.

Greg Bader chief technical officer with Perth-based iiNet, said the company was prepared to consider the federal Government's expression of interest.

"If it's something consumers want, we're happy to be a part of it," he said.

The need to remove illegal and offensive content from the internet had grown alongside its shift into the mainstream, he said.

The blacklist-based filtering technology removed the risk that service providers would be called on to censor the internet.

"The key here is there are various levels of filtering. No one on earth can disagree that anything illegal could and should be filtered, but the question is who decides what is filtered.

"ISPs are not in a position to be gatekeepers of what's legal and not legal and what's good or bad content," he said.

Australia's peak internet industry body the Internet Industry Association, said it was in discussions with ISPs to develop a uniform approach to the federal policy.

Association chief executive Peter Coroneos said it was becoming harder for ISPs to distance themselves from the debate as providers overseas were helping to regulate internet content.

The industry could end up facing more onerous regulations if it did not take an active role in Labor's attempt to deliver on its election promise.

"It's fair to say there is still some concern about the policy, but you have a really stark choice here: you either co-operate or you don't. If you don't, you can't complain about the result afterwards," Mr Coroneos said.

Labor's policy still drew fire from some service providers, which argued it was hopelessly unworkable and technically flawed.

Internode regulatory affairs manager John Lindsay said the ACMA trial demonstrated minor improvements to filtering technology but failed to address key areas such as additional costs for service providers.

The test results, he said, indicated that the technology would cause major network degradation if it were to be effective. It was also very easy for users to circumvent, he said.

"We are really pleased to see the Government cares about this stuff. We'd just really love it if the Government could come up with some sensible options rather than politically pragmatic options," Mr Lindsay said.
http://www.australianit.news.com.au/...-15306,00.html





R.I.P Usenet: 1980-2008
Sascha Segan

Before the Eternal September, but after the Great Renaming, I learned about sex on Usenet. A few years later, on a Mac SE in a college basement, I met friends I still have today. We "spewed" about our teenage lives in ways that would be familiar to any MySpace blogger circa 2008, but that were radical, strange, and comforting in 1993. We made faraway friends, burned yearbooks to CDs and mailed them to Finland with way too many stamps. We were the first Net kids, really.

In a way inconceivable in today's Web-fragmented marketplace, Usenet was where you went to talk. Conceived back in the idealistic, non-profit days of the Internet, it was—well, it is, but it mostly was—a series of bulletin boards called "newsgroups" shared by thousands of computers, which traded new messages several times a day.

On the text-only Usenet of my memory, nobody knew whether you were a dog, or a kid, or Finnish—only what you wrote. There wasn't the obsession with photos and video that overruns today's social networking sites. Yeah, I know that sounds like "get off my lawn you darn kids" crotchetiness, but there's something really nice about just talking to people and not caring what they look like.

Serious conversations went on in forums like comp.sys.atari.8bit; more frivolous chatter appeared in groups whose names started with "alt," a freewheeling free-for-all that nobody owned, nobody managed, and nobody policed. It was a more innocent time on the Net, before most of the spammers, the crooks, or even the general public showed up. People hewed to a loosely agreed-upon set of net.manners enforced by self-appointed cops. The society worked—at least for a while.

Usenet was what the Web is missing nowadays: a genuinely public space, with unclear ownership. While different people hung out in different groups, everyone accessed the same group list and there was plenty of cross-fertilization. Control came down to a bickering cabal of scattered IT administrators who generally preferred to leave well enough alone. Compared to chat systems like IRC (and later, instant messaging and texting), Usenet encouraged thoughtful, long-form writing with lots of quotation and back-and-forth.—Next: Usenet's Decline >

Usenet has been dying for years, of course. Some people date Usenet's decline as early as 1993, when millions of AOL users dropped into what was previously a geek paradise. As the '90s went on, the eye candy of the Web and the marketing dollars of Web site owners helped push people over to profit-making sites. Usenet's slightly arcane access methods and text-only protocols have nothing on the glitz and glamour of MySpace.

The Web also gave Usenet a new life through the mid-90s as a searchable database of questions and answers, via DejaNews and Google. But searchability also killed off some of Usenet's social functions. More chaotic and ad-hoc groups functioned through a sort of security in obscurity; as long as nobody bothered to click on them, nobody would know what people were talking about. With Google Groups, every word you wrote became enshrined and eternally searchable.

Meanwhile, as multimedia became popular over the past ten years, Usenet started to become a way for pirates and pornographers to distribute massive quantities of binary files in a decentralized, untraceable manner; in other words, it became a proto-BitTorrent. That was likely when Usenet became truly doomed. Newsgroups had exchanged code along with text for years, but by the late '90s the "binaries" groups began taking up huge amounts of space and Net traffic, and since Usenet libraries reside on each ISP's server, service providers sensibly started to wonder why they should be reserving big chunks of their own disk space for pirated movies and repetitive porn.

It's the porn that's putting nails in Usenet's coffin. AOL dropped Usenet in 2005, but many other large ISPs kept carrying newsgroups. Now major providers are dropping the full alt. hierarchy, and even Usenet entirely, as part of a New York State government crusade against child pornographers who've been using the alt.binaries groups to distribute their wares. Dropping all of Usenet to lose alt.binaries.videos.of.criminal.acts is definitely throwing the baby out with the bathwater, but at the same time I don't have much pity for the binaries crowd. Usenet is a hideously inefficient way to distribute binary file—you end up making thousands of unused copies on various servers and encoding your files in inefficient ways. And way too much of the binaries traffic consists of piracy and warez.

It's hard to completely kill off something as totally decentralized as Usenet; as long as two servers agree to share the NNTP protocol, it'll continue on in some fashion. But the Usenet I mourn is long gone, anyway, or long-transformed into interlocking comments on LiveJournals and the forums boards on tech-support Web sites. Obviously, people lead lives, converse, and learn on the Internet far more broadly than they did in 1993. But give me a moment's nostalgia for a Net that had one place to go, that everybody knew about, but nobody owned.
http://www.pcmag.com/article2/0,2817,2326848,00.asp





Lawsuit Over E-Vote Machines Dismissed
Martin Griffith

A judge has dismissed a citizen activist's lawsuit against a leading provider of electronic voting machines, saying no proof was offered that they malfunctioned.

In her complaint, filed in 2006, Patricia Axelrod of Reno claimed her vote in the 2004 general election was not counted because of a defective machine made by Oakland-based Sequoia Voting Systems. The same machines have come under fire in California.

But in a ruling issued earlier this month, Washoe County District Judge Jerome Polaha said state statutes cited by Axelrod gave her no standing to sue the company over an alleged lost vote.

The judge further said the alleged lost vote fails to constitute a "property interest," as Axelrod claimed, and that Sequoia's machines have not been shown to have malfunctioned.

Sequoia vice president Michelle M. Shafer hailed the ruling.

"Since the inception of this matter, it has been Sequoia's belief that the claims asserted had no basis in either fact or law," she said Sunday. "The court's dismissal of the lawsuit confirms this belief."

Axelrod, who acted as her own counsel, said she was undecided whether to appeal the ruling to the Nevada Supreme Court.

'Whether you're a Democrat or Republican, you're going to have reason to doubt the outcome of this year's election," she said Sunday. "The very same machines used in Nevada have been decertified for use by the state of California."

Last August, California Secretary of State Debra Bowen decertified voting machines made by Sequoia and another company but said they could regain certification if they meet several new conditions.

Bowen's action came after University of California computer experts found voting machines sold by Sequoia and two other companies were vulnerable to hackers and that voting results could be altered.

Sequoia criticized the study, calling it "an unrealistic, worst-case-scenario evaluation."

The state of Nevada was the first in the nation to use electronic voting equipment with a voter-verified paper audit trail, using Sequoia machines.

Nevada election officials have said they're monitoring developments in California and working on election security and other issues.

Axelrod said she found her 2004 vote was neither registered nor counted after she accessed her voting record on the county Registrar of Voter's Diebold Election Management System computer.

She said she doesn't trust touch-screen technology and wants a return to paper ballots.

In March, Polaha dismissed Axelrod's claims against other defendants in the lawsuit, including Diebold, the state of Nevada and Washoe County.
http://www.siliconvalley.com/news/ci...nclick_check=1





Microsoft to Build on Auto Unit

Sync technology creator hires Detroit native to boost connectivity in cars
Bryce G. Hoffman

Detroit may be struggling to sell cars, but Microsoft Corp. sees nothing but room to grow in its push to wire them.

The Redmond, Wash.-based software company today will announce a massive new investment in its automotive business unit and tapped a Detroit native to lead the charge.

"We're doubling down. We're going to increase the headcount and operating expenses by 30 percent this year," said Tom Phillips, a 16-year veteran of Microsoft who will replace Martin Thall as the head of the company's automotive division. "We know that things are tough for the auto industry, but it's the perfect time to make this investment. There are new customers coming into the market, and they are looking for new experiences."

Microsoft works closely with a number of car companies to bring computer connectivity and infotainment to the automobile. The most visible fruit of those efforts is Sync, the product of Microsoft's collaboration with Ford Motor Co. that debuted last year and has already given the Dearborn automaker a much-needed boost with younger car buyers. It allows motorists to control their cell phones, music players and navigation systems with voice commands.

Phillips, who is currently the chief technical officer of Microsoft's specialized devices and services group -- a post he will continue to hold in addition to running the automotive operations -- told The Detroit News that Sync is just the beginning.

"There are a lot of technologies that are two to three years out that are going to provide even more connectivity and innovation," he said.

"There's such a disconnect between what people experience in their cars and what they experience in the rest of their lives. It hasn't really evolved that much."

Microsoft announced one today, saying it is now making its "Live Search" technology available to automakers. Using it, they will be able to develop in-car systems that allow drivers to search for nearby businesses.

Despite a deepening downturn in the United States, Phillips said the auto market is too big for Microsoft to ignore. The company already dominates desktop computing. He said the 820 million cars in the world are the next great frontier to conquer.

"Even if you get a 10 percent or 20 percent market share, you've got an enormous scale," he said.

Ford welcomed Microsoft's new investment in automotive research and development.

"Ford and Microsoft working together to deliver Sync has been a great experience and demonstrates what can happen when the power of two iconic brands comes together," said Jim Buczkowski, director of electrical and electronics systems engineering at Ford. "Ford Sync has proven to be a tremendous differentiator for us in the marketplace and working with Microsoft has been the key element in setting the industry benchmark for connectivity."

Ford recently passed the 200,000-unit sales milestone and is on track to deliver one million Sync-equipped vehicles by the end of next year. More importantly, Sync has dramatically increased Ford's appeal to younger drivers, according to company survey data. And it has helped Ford increase the average transaction price of its entry-level Ford Focus sedan by $1,000 over the past year.

"Clearly, the customers are recognizing the value and they are willing to pay for it," said Ford Americas President Mark Fields.
http://www.detnews.com/apps/pbcs.dll...807290374/1148





With Security at Risk, a Push to Patch the Web
John Markoff

Since a secret emergency meeting of computer security experts at Microsoft’s headquarters in March, Dan Kaminsky has been urging companies around the world to fix a potentially dangerous flaw in the basic plumbing of the Internet.

While Internet service providers are racing to fix the problem, which makes it possible for criminals to divert users to fake Web sites where personal and financial information can be stolen, Mr. Kaminsky worries that they have not moved quickly enough.

By his estimate, roughly 41 percent of the Internet is still vulnerable. Now Mr. Kaminsky, a technical consultant who first discovered the problem, has been ramping up the pressure on companies and organizations to make the necessary software changes before criminal hackers take advantage of the flaw.

Next week, he will take another step by publicly laying out the details of the flaw at a security conference in Las Vegas. That should force computer network administrators to fix millions of affected systems.

But his explanation of the flaw will also make it easier for criminals to exploit it, and steal passwords and other personal information.

Mr. Kaminsky walks a fine line between protecting millions of computer users and eroding consumer confidence in Internet banking and shopping. But he is among those experts who think that full disclosure of security threats can push network administrators to take action. “We need to have disaster planning, and we need to worry,” he said.

The flaw that Mr. Kaminsky discovered is in the Domain Name System, a kind of automated phone book that converts human-friendly addresses like google.com into machine-friendly numeric counterparts.

The potential consequences of the flaw are significant. It could allow a criminal to redirect Web traffic secretly, so that a person typing a bank’s actual Web address would be sent to an impostor site set up to steal the user’s name and password. The user might have no clue about the misdirection, and unconfirmed reports in the Web community indicate that attempted attacks are already under way.

The problem is analogous to the risk of phoning directory assistance at, for example, AT&T, asking for the number for Bank of America and being given an illicit number at which an operator masquerading as a bank employee asks for your account number and password.

The online flaw and the rush to repair it are an urgent reminder that the Internet remains a sometimes anarchic jumble of jurisdictions. No single person or group can step in to protect the online transactions of millions of users. Internet security rests on the shoulders of people like Mr. Kaminsky, a director at IOActive, a computer security firm, who had to persuade other experts that the problem was real.

“This drives home the risk people face, and the consumer should get the message,” said Ken Silva, chief technology officer of VeriSign, which administers Internet addresses ending in .com and .net. “Don’t just take for granted all the things that machines are doing for you.”

When Mr. Kaminsky, 29, announced the flaw on July 8, he said he would wait a month to release details about it, in the hope that he could spur managers of computer systems around the world to fix them with a software patch before attackers could figure out how to exploit it.

Last week, however, accurate details of the flaw were briefly published online by a computer security firm, apparently by accident. Now security experts are holding their breath to see whether the patching of as many as nine million affected computers around the world will happen fast enough.

“People are taking this pretty seriously and patching their servers,” Mr. Silva said.

Major Internet service providers in the United States this week indicated that in most cases, the software patch, which makes the flaw much more difficult to exploit, was already in place or soon would be.

Comcast and Verizon, two of the largest providers, said they had fixed the problem for their customers. AT&T said it was in the process of doing so.

But the problem is a global one, and the length of time required to fix it could leave many Web users vulnerable for weeks or months. And there are millions of places around the world where people might find themselves vulnerable to potential attacks, ranging from their workplaces to an airport lounge or an Internet cafe.

Individuals and small companies with some technical skills can protect themselves by changing the network preferences of their computer settings so that they use the domain name servers of a Web service called OpenDNS (www.opendns.com).

Some computer systems are immune to the flaw. About 15 percent of domain name servers in the United States and 40 percent in Europe, including those at major Internet providers like America Online and Deutsche Telekom, use software from a Dutch company called PowerDNS, which is not vulnerable.

Still, much of the Internet remains vulnerable. “I’m watching people patch, and I realize this is not an easy thing to do,” Mr. Kaminsky said in an interview.

The flaw, which Mr. Kaminsky stumbled across in February, had been overlooked for more than two decades. The eureka moment came when he was idly contemplating a different security threat. He suddenly realized that it would be possible to guess crucial information about the protocol that domain name servers use to convert the numerical Web addresses.

Mr. Kaminsky worried about his discovery for several days and then contacted Paul Vixie, a software engineer who runs the Internet Systems Consortium and is responsible for maintaining a widely used version of software for domain name servers, known as BIND. Almost immediately, software engineers who looked at the vulnerability realized that Mr. Kaminsky had found a significant weakness.

In March, Microsoft held the secret meeting at its headquarters in Redmond, Wash. Sixteen representatives from security organizations and companies, including Cisco, talked about ways to combat the potential threat.

But after several delays while vendors fixed their software, Mr. Kaminsky went public.

For Mr. Kaminsky, the discovery and his subsequent warning to the Internet community were the culmination of an almost decade-long career as a security specialist. He was spotting bugs in software for Cisco and contributing to a book on computer security while still in college.

“I play this game to protect people,” he said.

He thinks that it is necessary to publish information about security threats to motivate system operators to protect themselves. Otherwise, “You don’t get to tell the river you need more time until it floods,” he said.

He said that he had initially hoped to give the Internet community a head start of a full month to fix the problem, but his plan was foiled when technical details were briefly posted online last week. “I would have liked more time, but we got 13 days and I’m proud of that,” he said.

The new flaw has sharpened the debate over how to come up with a long-term solution to the broader problem of the lack of security in the Domain Name System, which was invented in 1983 and was not created with uses like online banking in mind.

While Mr. Kaminsky is being hailed as a latter-day Paul Revere, Internet experts like Bruce Schneier, a member of the insular community that guards online security, said flaws like this were a routine occurrence and no reason to stay off the Internet.

“If there is a flaw in your car, it will get fixed eventually,” said Mr. Schneier, the chief security technology officer for British Telecom. “Most people keep driving.”
http://www.nytimes.com/2008/07/30/te...gy/30flaw.html





Project to Rebuild Internet Gets $12m, Bandwidth
Anick Jesdanun

A massive project to redesign and rebuild the Internet from scratch is inching along with $12 million in government funding and donations of network capacity by two major research organizations.

Many researchers want to rethink the Internet's underlying architecture, saying a "clean-slate" approach is the only way to truly address security and other challenges that have cropped up since the Internet's birth in 1969.

On behalf of the government, BBN Technologies Inc. is overseeing the planning and design of the Global Environment for Network Innovations, or GENI, a network on which researchers will be able to test new ideas without damaging the current Internet.

The $12 million in initial grants from the National Science Foundation will go to developing prototypes for the GENI network.

To test these prototypes, the Internet2 organization is contributing 10 gigabits per second of dedicated bandwidth, so researchers won't have to worry about normal Internet traffic interfering with their experiments. National LambdaRail is offering another 30 gigabits per second of capacity, though it won't be dedicated to GENI at all times.

The bandwidth is thousands of times faster than standard home broadband connections — enough to run 30 high-quality movies into your home simultaneously.

Craig Partridge, chief scientist at BBN Technologies, said the commitments amounted to an important endorsement of GENI by two organizations that run ultra-high-speed networks for universities and other researchers to conduct data-intensive projects.

Construction on GENI could start in about five years and cost $350 million. Congress still has to approve those funds.
http://news.yahoo.com/s/ap/20080730/...3RQ 2Ny1k24cA





'Hijacked' SF Passwords Made Public
Jennifer Guevin

Only days after the city of San Francisco regained control of its computer network after an alleged hijacking, a new vulnerability has come to light--this time brought on by the city itself.

The San Francisco district attorney's office has apparently made public nearly 150 usernames and passwords used by city officials to gain access to the city's network. The list was submitted to the court as Exhibit A in a case against Terry Childs, a 43-year-old network administrator for the city who was arrested July 13 on four felony charges of tampering with the city's computer network.

Co-workers accused Childs of setting a "time bomb" that would sabotage the network the next time it went down, either for maintenance or due to a power outage.

Childs had effectively taken the city's network hostage by locking administrators out and refusing to give up the passwords needed to regain access. In a secret meeting with Mayor Gavin Newsom earlier this week, the San Francisco Chronicle reported that Childs handed them over directly to the mayor.

Later in the week, the DA's office reportedly filed a court document to argue against a reduction of the $5 million bail set for Childs, who is being held in the county jail. Exhibit A of the document contained the usernames and passwords used by nearly 150 employees to get into the city's virtual private network. And despite saying the passwords pose an "imminent threat" to the city's computer network, they are now of public record.

A source tells InfoWorld that a second password is needed to gain access to the VPN. Still, giving up these so-called phase one passwords is hardly recommended security policy.

And here I thought we San Franciscans were supposed to be good with this computer stuff.
http://news.cnet.com/8301-1009_3-10000342-83.html





'Pentagon Hacker' Loses Extradition Appeal
AP

Britain's top court refused Wednesday to stop the extradition to the U.S. of a British hacker accused of breaking into Pentagon and NASA computers -- something he claims to have done while hunting for information on UFOs.

Gary McKinnon, 42, faces charges in the United States for what officials say were a series of cyber attacks that stole passwords, attacked military networks and wrought hundreds of thousands of dollars worth of computer damage.

The decision by Britain's House of Lords -- comparable to U.S. supreme court judges -- was his last legal option in this country, but his lawyer said she would appeal his case to the European Court of Human Rights in Strasbourg, France.

"The consequences he faces if extradited are both disproportionate and intolerable and we will be making an immediate application to the European court to prevent his removal," Karen Todner said after McKinnon's appeal was rejected. "We believe that the British government declined to prosecute him to enable the U.S. government to make an example of him."

McKinnon's lawyers alleged that an American official had told him he would be forced to serve a lengthy sentence in the United States if he fought against his extradition, something they say amounted to an unlawful threat.

The five Law Lords were unanimous in deciding McKinnon had failed to prove his case.

McKinnon's supporters say they want him freed -- or at least tried in Britain.

Prosecutors allege that McKinnon hacked into than 90 computer systems belonging to the U.S. Army, Navy, Air Force, Department of Defense and NASA between February 2001 and March 2002, causing $900,000 worth of damage.

McKinnon has acknowledged accessing the computers, but he disputes the reported damage and said he did it because he wanted to find evidence that America was concealing the existence of aliens.

He was caught in 2002 after some of the software used in the attacks was traced back to his girlfriend's e- mail account.
http://www.cnn.com/2008/WORLD/europe....ap/index.html





Hacker Vows to Fight Extradition
BBC

A Briton accused of hacking into top-secret military computers has vowed to fight extradition to stand trial in the US after losing a court appeal.

Glasgow-born Gary McKinnon could face life in jail if convicted of accessing 97 US military and Nasa computers.

He has admitted breaking into the computers from his London home but said he was seeking information on UFOs.

Mr McKinnon says he will take his case to the European Court of Human Rights after losing the Law Lords appeal.

Mr McKinnon, 42, first lost his case at the High Court in 2006 before taking it to the highest court in the UK, the House of Lords.

He was arrested in 2002 but never charged in the UK.

The US government claims he committed a malicious crime - the biggest military computer hack ever.

The authorities have warned that without his co-operation and a guilty plea the case could be treated as terrorism and he could face a long jail sentence.

'Moral crusade'

Mr McKinnon, now living in north London, told BBC Radio 5 Live he was "pretty broken up" by the Law Lords' ruling, although he had expected the outcome.

He admitted he had been "misguided" in what he did, but said he believed at the time that he was acting in the public interest.

"It felt like a moral crusade," he said.

However, Mr McKinnon said he did not accept US claims that he caused damage to their systems. Instead he said he maintained a "quiet presence" and actually highlighted security problems.

"I'm extremely sorry I did it, but I think the reaction is completely overstated. I should face a penalty in Britain and I'd gladly do my time here," he said.

"To go from, you know, perhaps a year or two in a British jail to 60 years in an American prison is ridiculous."

A statement by solicitors for Mr McKinnon, who was not at the Lords to hear the judgement, said their client was "neither a terrorist nor a terrorist sympathiser".

"His case could have been properly dealt with by our own prosecuting authorities. We believe that the British government declined to prosecute him to enable the US government to make an example of him.

"American officials involved in this case have stated that they want to see him 'fry'.

"The consequences he faces if extradited are both disproportionate and intolerable."

'Critical systems'

Mr McKinnon's lawyers also claim he could be sent to Guantanamo Bay if he is treated as a terrorist.

Mr McKinnon, a former systems analyst, is accused of hacking into the computers with the intention of intimidating the US government.

It alleges that between February 2001 and March 2002, he hacked into dozens of US Army, Navy, Air Force, and Department of Defense computers, as well as 16 Nasa computers.

Prosecutors say he altered and deleted files at a naval air station not long after the 11 September attacks in 2001, rendering critical systems inoperable.

Mr McKinnon, who is currently unemployed, has admitted that he accessed computers in the US without authority.

But he has said he is merely a computer nerd, whose motives were harmless and innocent. He denies any attempts at sabotage.

He said he wanted to find evidence of UFOs he thought was being held by the US authorities, and to expose what he believed was a cover-up.

Repatriated

The Law Lords were told by Mr McKinnon's lawyers that extraditing him would be an abuse of proceedings.

US authorities had threatened him with a long jail sentence if he did not plead guilty, they said.

If the case was treated as terrorism it could result in a sentence of up to 60 years in a maximum security prison, should he be found guilty on all six indictments.

With co-operation, he would receive a lesser sentence of 37 to 46 months and be repatriated to the UK, where he could be released on parole and charges of "significantly damaging national security" would be dropped.

A Home Office spokesman said Mr McKinnon would have 14 days in which to seek appeal at the European Court of Human Rights.

If a hearing is granted, Mr McKinnon's extradition would be halted until the European verdict.

"If refused, arrangements for surrender to the USA will be put in hand," she added.
http://news.bbc.co.uk/go/pr/fr/-/1/hi/uk/7533916.stm





A Photo That Can Steal Your Online Credentials

By placing a new type of hybrid file on Web sites that let users upload their own images, researchers can circumvent security systems and take over Web surfers' accounts
Robert McMillan

At the Black Hat computer security conference in Las Vegas next week, researchers will demonstrate software they've developed that could steal online credentials from users of popular Web sites such as Facebook, eBay, and Google.

The attack relies on a new type of hybrid file that looks like different things to different programs. By placing these files on Web sites that allow users to upload their own images, the researchers can circumvent security systems and take over the accounts of Web surfers who use these sites.

"We've been able to come up with a Java applet that for all intents and purposes is an image," said John Heasman, vice president of research at NGS Software.

They call this type of file a GIFAR, a contraction of GIF and JAR, the two file types that are mixed. At Black Hat, the researchers will show attendees how to create the GIFAR while omitting a few key details to prevent it from being used immediately in any widespread attack.

To the Web server, the file looks exactly like a .gif file, however a browser's Java virtual machine will open it up as a Java Archive file and then run it as an applet. That gives the attacker an opportunity to run Java code in the victim's browser. For its part, the browser treats this malicious applet as though it were written by the Web site's developers.

Here's how an attack would work: The bad guys would create a profile on one of these popular Web sites -- Facebook, for example -- and upload their GIFAR as an image on the site. Then they'd trick the victim into visiting a malicious Web site, which would tell the victim's browser to go open the GIFAR. At that point, the applet would run in the browser, giving the bad guys access to the victim's Facebook account.

The attack could work on any site that allows users to upload files, potentially even on Web sites that are used to upload banking card photos or even Amazon.com, they say.

Because GIFARs are opened by Java, they can be opened in many types of browsers.

There is one catch, however. The victim would have to be logged into the Web site that is hosting the image for the attack to work. "The attack is going to work best wherever you leave yourself logged in for long periods of time," Heasman said.

There are a couple of ways that the GIFAR attack could be thwarted. Web sites could beef up their filtering tools so that they could spot the hybrid files. Alternatively, Sun could tighten up the Java runtime environment to prevent this from happening. The researchers expect Sun to come up with a fix not long after its Black Hat talk.

But researchers say that while a Java fix may disable this one attack vector, the problem of malicious content being placed on legitimate Web applications is a much larger and thornier issue. "There will be other ways to do this, with other technologies," said GIFAR developer Nathan McFeters, a researcher with Ernst & Young's Advanced Security Center.

"In the long term, Web applications are going to have to take control of the content," McFeters said. "It's a Web application issue. The Java attack that we're currently using is just one vector."

He and his fellow Black Hat presenters have entitled their talk The Internet is Broken.

Ultimately, browser makers will have to make some fundamental changes to their software too, said Jeremiah Grossman, chief technology officer with White Hat Security. "It's not that the Internet is broken," he said. "It's that browser security is broken. Browser security is really an oxymoron."
http://whois.domaintools.com/211.142.116.205





DIY

Band Leaks Track to BitTorrent, Blames Pirates
Ernesto

When we reported about the leak of a BuckCherry track last week, and specifically the band’s response to it, we hinted that this could be a covert form of self-promotion. Indeed, after a few days of research we found out that the track wasn’t leaked by pirates, but by Josh Klemme, the manager of the band.

When BuckCherry found out that their latest single had leaked on BitTorrent, they didn’t try to cover this up, or take the file down. No, instead, they issued a press release, where they stated: “Honestly, we hate it when this s*** happens, because we want our FANS to have any new songs first.”

This is strange to say the least. Not only because their label, Atlantic Records, is known to release (and spam) tracks for free on BitTorrent sites, but also because the press release was more about promoting the band than the actual leak. Without any hard evidence, we suggested that this leak may have been set up to get some free promotion and publicity, which BuckCherry seems to need.

Out of curiosity, we decided to follow this up, to see if this was indeed the case. With some help of a user in the community, we tracked down some of the initial seeders of the torrent. A BitTorrent site insider was kind enough to help us out, because BitTorrent is not supposed to be “abused” like this, and confirmed that the IP of one of the early seeders did indeed belong to the person who uploaded the torrent file.

It turns out that the uploader, a New York resident, had only uploaded one torrent, the BuckCherry track. When we entered the IP-address into the Wiki-scanner, we found out that the person in question had edited the BuckCherry wikipedia entry, and added the name of the band manager to another page.

This confirmed our suspicions, but it was not quite enough, since it could be an overly obsessed fan (if they have fans). So, we decided to send the band manager, Josh Klemme - who happens to live in New York - an email to ask for his opinion on our findings. Klemme, replied to our email within a few hours, and surprisingly enough his IP-address was the same as the uploader.

Epic fail….

Unfortunately Klemme only replied once, and ignored all further requests to comment on this issue. However, the press release, sent out by Atlantic Records and BuckCherry, seems to be a promotional stunt. It could be that the manager acted on his own, and that the band and the record label were not not in on this, but that’s less plausible.

Klemme has been caught with his pants down, and he will probably think twice before he tries to pull off a stunt like this again. A song doesn’t leak by itself and pirates don’t have some sort of superhuman ability to get their hands on pre-release material. No, most leaked movies, TV-shows and albums come from the inside so blaming pirates is useless.

Of course, it’s great that BuckCherry can get some free promotion for the band using BitTorrent, and we encourage everyone to promote their band or movie via this great system too. But wouldn’t it be more constructive if bands embraced the technology and admitted it, instead of playing the injured party and giving the protocol a bad image, just to boost their own? There’s a great opportunity here, don’t waste it.
http://torrentfreak.com/band-leaks-t...irates-080731/





The Pirates Can't Be Stopped

A teenager hacked into the outfit charged with protecting companies like Sony, Universal, and Activision from online piracy—the most daring exploit yet in the escalating war between fans and corporate giants. Guess which side is winning.
Daniel Roth

From: Ty Heath [MediaDefender]
Sent: Wednesday, June 6, 2007 7:02 p.m.
To: it <it@mediadefender.com>
Subject: pm webserver

The 65.120.42.146 pm webserver has been compromised […]
As a side note, please do not ever use the old passwords on anything.

The first time Ethan broke into MediaDefender, he had no idea what he had found. It was his Christmas break, and the high schooler was hunkered down in the basement office of his family's suburban home. The place was, as usual, a mess. Papers and electrical cords covered the floor and crowded the desk near his father's Macs and his own five-year-old Hewlett-Packard desktop. While his family slept, Ethan would take over the office, and soon enough he'd start taking over the computer networks of companies around the world. Exploiting a weakness in MediaDefender's firewall, he started poking around on the company's servers. He found folder after folder labeled with the names of some of the largest media companies on the planet: News Corp., Time Warner, Universal.

Since 2000, MediaDefender has served as the online guard dog of the entertainment world, protecting it against internet piracy. When Transformers was about to hit theaters in summer 2007, Paramount turned to the company to stop the film's spread online. Island Records counted on MediaDefender to protect Amy Winehouse's Back to Black album, as did NBC with 30 Rock. Activision asked MediaDefender to safeguard games like Guitar Hero; Sony, its music and films; and World Wrestling Entertainment, its pay-per-view steel-cage championships and pudding-wrestling matches.

MediaDefender's main stalking grounds are the destinations that help people find and download movies and music for free. Sites such as the Pirate Bay and networks like Lime Wire rely on peer-to-peer, or P2P, software, which allows users to connect with one another and easily share files. (See what movies, television shows, and music are most downloaded.) MediaDefender monitors this traffic and employs a handful of tricks to sabotage it, including planting booby-trapped versions of songs and films to frustrate downloaders. When the company's tactics work, someone trying to download a pirated copy of Spider-Man 3 might find the process interminable, or someone grabbing Knocked Up might discover it's nothing but static. Other MediaDefender programs interfere with the process pirates use to upload authentic copies. When Ethan hacked into the company, at the end of 2006, MediaDefender was finishing an exceptional year: Its revenue had more than doubled, to $15.8 million, and profit margins were hovering at about 50 percent.

Ethan and I had first started talking over an untraceable prepaid phone that he carried with him. He eventually agrees to speak in person, as long as I protect his identity. (Ethan is a pseudonym.) We meet after school, in a bookstore that he says is near his house. He hands me a flash drive containing documents that I was later able to independently verify as internal, unpublished information belonging to MediaDefender. He also pulls out a well-creased sheet of paper bearing my name, the first five digits of my Social Security number, a few pictures of me, and addresses going back 10 years. "I had to check," he says. Then he asks me about another Roth he has been researching; it turns out to be my brother. "I was just starting to dig in to him," he says. "There's a lot there." Ethan is a handsome kid, with broad shoulders and a preppy style, and is unfailingly polite, cleaning up the table after I buy him a coffee and patiently walking me through the intricate details of Microsoft security procedures.

Ethan explains to me that the Christmastime break-in didn't proceed very far. While logged into MediaDefender on one computer, he chatted on another with some hacker friends to see if they knew anything about the firm. But the conversation quickly shifted to other exploits the group wanted to pull off on that cold evening—cell-phone hacks, fake pizza deliveries, denial-of-service attacks—and Ethan moved on.

In the spring, however, he decided to explore the company again. Over the next few months, Ethan says, he figured out how to read MediaDefender's email, listen to its phone calls, and access just about any of the company's computers he wanted to browse. He uncovered the salaries of the top engineers as well as names and contact information kept by C.E.O. and co-founder Randy Saaf (with notations of who in the videogame industry is an "asshole" and which venture capitalists didn't come through with financing). Ethan also figured out how the firm's pirate-fighting software works. He passed on his expertise to a fellow hacker, who broke into one of MediaDefender's servers and commandeered it so that it could be used for denial-of-service attacks.

Ethan continued to log in to MediaDefender about twice a week throughout the summer of 2007. Usually, he'd head down to the basement office after his S.A.T. prep classes. After a while, his friends grew tired of hearing about his stunts inside Monkey Defenders, as he began to call the company. And eventually, he himself got bored. So in September, he decided to give the entire thing up, but not before he and a few fellow hackers pulled a prank: They grabbed a half-year's worth of internal emails and published them on the same file-sharing sites prowled by MediaDefender. A comment posted with the messages read, "By releasing these emails we hope to secure the privacy and personal integrity of all peer-to-peer users. The emails contains [sic] information about the various tactics and technical solutions for tracking P2P users, and disrupt P2P services.... We hope this is enough to create a viable defense to the tactics used by these companies." It was signed MediaDefender-Defenders.

A few days later, Ethan and his friends put more material online. One file contained the source code for MediaDefender's antipiracy system. Another demonstrated just how deep inside the company they had gone. This file featured a tense 30-minute phone call between employees of MediaDefender and the New York State attorney general's office discussing an investigation into child porn that the firm was assisting with. (MediaDefender refused to comment for this story.) The phone call makes clear that the hackers had left a few footprints while prowling MediaDefender's computers. The government officials had detected someone trying to access one of its servers, and the hacker seemed to know all the right log-in information. "How comfortable are you guys that your email server is free of, uh, other eyes?" an investigator with the attorney general asked during the call.

"Oh, yeah, yeah, we've checked out our email server, and our email server itself has not been compromised," the MediaDefender executive said.

But, of course, it had.

"In the beginning, I had no motivation against Monkey Defenders," Ethan tells me. "It wasn't like, 'I want to hack those bastards.' But then I found something, and the good nature in me said, These guys are not right. I'm going to destroy them."

And so he set out to do just that: a teenager, operating on a dated computer, taking on—when his schedule allowed—one of the entertainment world's best technological defenses against downloading. The U.S. movie industry estimates that it loses more than $2 billion a year to file sharers; the record industry, another $3.7 billion. "Piracy," intoned Dan Glickman, the head of the Motion Picture Association of America trade group, to Congress in late 2006, "is the greatest obstacle the film industry currently faces." Instead of figuring out whether there is a way to make online distribution work—to profit from downloading—the industry has obsessed for years with battling it. Yet it took only a few months for Ethan to expose just how quixotic that fight has become.

From: Randy Saaf
Sent: Wednesday, April 11, 2007 9:24 p.m.
To: [various MediaDefender employees]
Subject: Fw: .edu filtering

Team Universal is curiouse [sic] if we have any historical data over the last 3 months that show whether .edu IP addresses on p2p have gone down. They want to see if their lawsuits are getting students to stop using p2p (take a moment to laugh to yourself). Let me know if anyone has any ideas.

When Saaf co-founded MediaDefender in 2000, Napster was at the height of its popularity. The file-sharing service was wildly popular on college campuses, where students used speedy broadband lines to amass huge music collections. The Recording Industry Association of America, the music-business trade group, considered Napster to be its No. 1 problem. Saaf thought he had a way to contain it. He invited Cary Sherman, then an R.I.A.A. executive and now its president, to drop by the startup's cramped Claremont, California, offices. As soon as Sherman walked in, he heard a yet-to-be-released Madonna track blaring from a set of speakers. "He was shocked," says Ron Paxson, one of the company's co-founders. "We showed him how we could block it from getting out onto the internet."

Over the next few years, the firm grew as downloading flourished and terrified entertainment execs turned to it for help. The content-wants-to-be-free chant of the internet generation began reverberating in the nightmares of music moguls—and then of executives further and further up the entertainment industry food chain. As broadband speeds increased and data storage got cheaper, it became easier and faster for anyone with a passing interest in pop culture to trade larger files like TV shows, movies, and software.

The technology for trading them also kept improving. When the record industry shut down Napster in 2001, a drove of oddly named services took its place: Ares, eDonkey, Grokster, Kazaa. In 2002, a lone programmer working at a table in his dining room invented BitTorrent, a technology that made file sharing even faster and more efficient. Within a few years of its creation, BitTorrent activity accounted for nearly 20 percent of all internet traffic. Between 2002 and 2006, the file-trading audience nearly doubled, with an average of more than 9 million people sharing files at any given time, according to BigChampagne, a company that monitors P2P traffic. The firm estimates that more than 1 billion songs are traded each month, a number that has more or less remained constant as the trading of feature films and TV shows has exploded.

Yet it has been difficult to quantify the damage supposedly wreaked by downloading. In mid-2007, economists Felix Oberholzer-Gee, from Harvard, and Koleman Strumpf, from the University of Kansas, published the results of their study analyzing the effect of file sharing on retail music sales in the U.S. They found no correlation between the two. "While downloads occur on a vast scale," they wrote, "most users are likely individuals who in the absence of file sharing would not have bought the music they downloaded." Another study published around the same time, however, found there was, in fact, a positive impact on retail sales, at least in Canada: University of London researchers Birgitte Andersen and Marion Frenz reported that the more people downloaded songs from P2P networks, the more CDs they bought. "Roughly half of all P2P tracks were downloaded because individuals wanted to hear songs before buying them or because they wanted to avoid purchasing the whole bundle of songs on the associated CDs, and roughly one-quarter were downloaded because they were not available for purchase."

Still, the entertainment industry believes it knows a bad guy when it sees one and has reacted to file sharing exactly as a character in one of its thrillers or shoot-'em-up games would: with a full-frontal, guns-a-blazing assault. For the past few years, the R.I.A.A. has employed MediaDefender's competitor, MediaSentry, to trace people uploading music so that the trade group can sue them. The R.I.A.A. and the M.P.A.A. have worked to get government on their side: In 2007, the organizations lobbied to water down a California bill designed to crack down on pretexting—the practice of using false pretenses to get personal information about someone. The M.P.A.A. argued that laws against pretexting would cripple its antipiracy efforts by imperiling "certain long-employed techniques to obtain information." In November, the groups lobbied the House of Representatives in support of a bill to make federal funding for universities partially contingent on how effectively they rid their campuses of file sharing.

"This is not Napster," says Harvey Weinstein, the movie mogul who heads the Weinstein Co., a MediaDefender client. "Online piracy has got to be stopped. The biggest spear in the neck of the pirates will be (a) being vigilant, (b) prosecuting, and (c) in a way, making fun of them, finding a way to say, 'That's not cool—that's anything but cool.' If you had people who the young people respect in this industry—Brad Pitt, George Clooney, Shia LaBeouf—if these guys did public service announcements that said, 'Don't steal, stealing's not cool,' I think you can go a long way toward stopping this." Weinstein says that if Democrats maintain control of Congress and gain the White House, he'll flex whatever political muscle he has acquired by being a major donor to achieve one thing: "Tougher, more stringent piracy laws." Does he see any use for P2P systems? "No."

Certainly, the few attempts that entertainment companies have made to accommodate downloaders have come across as halfhearted and have turned out dismally. Five major movie studios—Sony, MGM, Paramount, Warner Bros., and Universal—sank $150 million into a cumbersome film-downloading service called Movielink, rolled out in 2002. In August, they unloaded the unit to Blockbuster for $6.6 million, after concluding that few consumers had the patience to master a technology that didn't match the ease or quality of that being offered by the pirates. NBC and News Corp. are optimistic about Hulu, a site that offers new and archived TV fare, but the shows contain unskippable ads and can't be downloaded, a disadvantage in this era of DVRs and iPods. All this comes after years of the music industry's blundering around for solutions. "The music companies were put on earth to make the video companies seem like visionaries," says Michael Gartenberg, research director of analysis firm JupiterResearch.

So the entertainment business lives by the motto "If you can't join them, beat them." As with all wars, of course, escalation most benefits the arms merchants. In 2005, the music portal ArtistDirect purchased MediaDefender for $42.5 million, making Saaf and his remaining co-founder, Octavio Herrera, multimillionaires at age 29. To retain the two men, ArtistDirect paid them an additional $525,000 each and gave them easy-to-hit bonuses that would keep their income at about $700,000 a year each. And the clients continued to come, even though those inside MediaDefender could see they were losing ground.

From: Jonathan Perez [MediaDefender]
Sent: Friday, June 22, 2007 6:33 p.m.
To: [various MediaDefender employees]
Subject: Sicko Torrents Results 6/22

Attached are today's internal testing results for Sicko. Our overall effectiveness did improve. However, we still have no presence on Pirate bay which is a site they are likely watching as it was mentioned in the AdAge article they referenced.

>From: Ethan Noble [Weinstein Co.]
>Sent: Friday, June 15, 2007 10:41 a.m.
>To: [various Weinstein employees]
>Subject: Re: Piracy—this is a real
>problem
>
>This is AdAge's main story today and
>they talk about ThePirateBay.org
>having [Michael Moore's Sicko] so I
>did a quick search and there are a
>couple of copies of the film on there
>right now. MAYBE and HOPEFULLY
>those are our guy's 'fake' versions…

Before Ethan started toying with MediaDefender, the company's biggest problem was a tall 29-year-old Swede named Peter Sunde. He and two partners run the most popular file-sharing site, the Pirate Bay. It draws about 25 million unique visitors every month; dozens of new movies, games, and TV shows pop up each hour. The R.I.A.A.'s international counterpart refers to the site as the "international engine of illegal file sharing." The Pirate Bay doesn't host any of the actual content; it just lists it and supplies the BitTorrent files that let people connect with each other in order to share their libraries.

Sunde lives in a tranquil suburb of Malmö, Sweden, once the country's shipbuilding capital. Today, he's dressed in jeans and a sweatshirt embroidered with a mushroom from the videogame Super Mario Bros. He opens the MacBook Pro in his living room and starts reading a recent email from an attorney representing Prince and the Village People: " 'The owners of the Pirate Bay willfully and unlawfully exploit and misappropriate both Prince's and the Village People's intellectual property and infringe on their rights of publicity,' blah, blah, blah. 'Regardless of Pirate Bay's wishful thinking and erroneous public-relations position on its website that U.S. intellectual property laws are inapplicable,' blah, blah, blah, 'the Swedish government may not be able to protect you.'

"I was reading this yesterday, and I started laughing so hard," Sunde says, swiveling in his chair. "They're going to reach our company? We're not even a company." The partners run the site more as a hobby: There is no registered trademark and minimal overhead. The Pirate Bay is basically just the domain name and a website. Sunde then reads me the reply he is about to post. "For fuck's sake," it begins, "get your facts straight," and becomes more insulting from there.

Sunde is a bit of a philosopher when it comes to what his site does. As he sees it, the Pirate Bay is simply delivering a service to consumers, giving them the entertainment they want when they want it. He motions to the home theater he has rigged up: "Just look at this. I have my own cinema. When I watch a movie, I'd rather be here with a blanket and a girlfriend than at the cinema with a lot of people that are annoying. And that has nothing to do with file sharing. The technology is here for us, so why shouldn't we do it?" As far as Sunde is concerned, Hollywood should stop attacking him and start listening. According to him, consumers don't care about how Hollywood wants to schedule its releases—movie theaters first, then pay-per-view, and so on. They want the content when and where it's convenient and comfortable. Is that so hard to understand?

Sweden is a file sharer's heaven. Its laws protect internet service providers from being sued for what passes through their networks, which gives them little incentive to turn downloaders over to groups like the R.I.A.A. or the M.P.A.A. The country is one of the most wired in the world, with high-speed-internet penetration as high as 75 percent in some areas and an average broadband speed that's nearly five times faster than that of the U.S. And as a rule, Swedish authorities have never been that interested in going after a bunch of websites that didn't seem to be doing anyone any real harm.

Nonetheless, Hollywood tried lobbying Sweden to do something about the Pirate Bay. In May 2006, partly at the prodding of the M.P.A.A., 52 Swedish police barged into multiple locations, including the Stockholm offices of the I.S.P. run by Sunde's partners, Gottfrid Svartholm and Fredrik Neij. Police confiscated 186 pieces of computer equipment and hauled in Svartholm and Neij for questioning. Sunde, who was at home in Malmö, learned about the raid from an email. He quickly downloaded the entire site to his home computer—source code, images, everything—finishing just as the last server was shut down in Stockholm. Three days later, he had the site back up and running, and soon thousands of supporters were turning up at pro-Pirate Bay rallies throughout the country. (The Swedish police have yet to bring charges, though the lead investigator promised in the fall to do so by the end of January—nearly two years after the raid, a delay highly unusual in Sweden.)

Sunde could handle the cops—one of the country's top attorneys immediately signed on to defend the Pirate Bayers. MediaDefender and the rest of the antipiracy firms presented a trickier problem. Even as police officers were preparing their blitz, the Pirate Bay guys were trying to figure out who was already attacking them online. Users complained in message boards and chat rooms that certain files failed to download fully and some that did were pure garbage. Sunde and his partners eventually traced some of the files back to a few hundred IP addresses—the series of numbers assigned to any device connected to the internet in order to identify it.

First, Sunde started blocking IP addresses from servers that appeared to host fake or corrupted files—MediaDefender had thousands of such computers hidden in server farms around the world—and then he blocked all the IP addresses originating from MediaDefender's headquarters. If MediaDefender wanted to search to see whether a client's files were accessible through the Pirate Bay, well, they'd just have to do it from home. Finally, Sunde started messing with his enemy: When MediaDefender tried to upload a torrent—the vital file that coordinates the download process—to the Pirate Bay, MediaDefender would get a notice that there had been a database error, requiring it to start the process over again. As far as the folks at MediaDefender could tell, the problem was with the Pirate Bay and not with the fact that its IP addresses had been detected. It would spend the rest of the day trying and trying to complete the upload. Sunde had managed to turn one of MediaDefender's tricks back on itself.

But for Saaf and Herrera, the Pirate Bay was just one of many problems. The two men had always been technically savvy, but now they were vastly outnumbered by the swarm of pirates and programmers collaborating to improve file-sharing technology. MediaDefender's IP addresses were exposed so quickly that the company was forced to buy new banks of numbers each month; at one point it considered using its employees' home connections to get fresh IP numbers. MediaDefender's year-over-year cost of doing business jumped 28 percent in the first quarter of 2007. Even worse, its parent company was dealing with the fallout from an S.E.C. inquiry into its accounting practices. To placate the government, ArtistDirect had restated its earnings, which triggered a clause that put into default the $46 million in debt the company had taken out to pay for MediaDefender.

Saaf and Herrera couldn't afford to have the wheels come off their division, which accounted for two-thirds of ArtistDirect's revenue. Worried about the efficacy of its piracy countermeasures, executives sent flurries of emails about how to stage-manage product demonstrations. In one instance, Universal Music Group was in the middle of negotiating a contract renewal worth more than $3.5 million with MediaDefender and wanted to test how effective the firm's tactics were. MediaDefender tried to persuade Universal to use a downloading program called µTorrent, which had been prone to falling for MediaDefender's tricks. In a note to Universal, Saaf hailed µTorrent as "the most popular" in the industry. A month earlier, when µTorrent developers appeared to be fixing the hole that MediaDefender had exploited, one of Saaf's underlings sent out an email asking if MediaDefender's engineers had come up with a plan B. "Randy will ask you very soon, so I'm just trying to preempt a shitstorm," he says.

From: Jonathan Lee [MediaDefender]
Sent: Wednesday, July 4, 2007 9:26 a.m.
To: Octavio Herrera, Randy Saaf, Ben Grodsky, Jay Mairs
Subject: Fw: hahahha

We have such a lovely fan base.

----- Original Message -----
>From: David White
>Sent: Wednesday, July 4, 2007 6:04 a.m.
>To: sales@mediadefender.com
>Subject: hahahha
>HAHAHAHAHAHA Digg got your site
>killed, thats what you guys get for
>trying to entrap people. MUSIC AND
>VIDEOS BELONG TO THE PEOPLE!!!!!
>quit trying to trap people downloading
>and suing then [sic], MEDIA
>DEFENDER SUCKS […]
>HAHAHAHAHAHAHAHAHAHAHA
>HAHAH

At some point, MediaDefender's clients were going to notice that Saaf was getting schooled by a bunch of amateur coders and by "the douche," as Saaf referred to Sunde in an email. The solutions devised by Saaf and his programmers were invariably ferreted out by the file-sharing community. In early July, a user at Digg, a heavily trafficked social-bookmarking site, put up a link to an item showing that MediaDefender was behind a new online video site called MiiVi. Bloggers accused the company of running a honeypot to trap pirates who were uploading protected content. Saaf quickly pounded out an email to his senior staff: "This is really fucked," he wrote. "Let's pull MiiVi offline." Ethan says he was behind the leak that led to the Digg post, and of course, he kept up his forays until that weekend in mid-September when he decided to show off his work.

After the company's internal affairs were made public, Saaf and Herrera spent the next few weeks trying to reassure everyone in the entertainment business that their antipiracy efforts were still effective. At a digital music conference held in L.A.'s Roosevelt hotel in early October, the men walked the halls, collaring colleagues and clients to explain what had happened and how they intended to bounce back from the hack. One way was with cash: Within weeks, the company shelled out $600,000 in service credits and another $225,000 to pay for legal advice.

Reading the purloined MediaDefender emails on the computer screen in his Malmö living room, Sunde realized there might be another method he could use to fight back against MediaDefender. The messages made it clear that Saaf and Herrera had put considerable energy into trying to degrade his work. Sunde called a lawyer to ask whether MediaDefender's actions were legal in Sweden. Then Sunde emailed the Swedish inspector who had raided the Pirate Bay's office—who else knew the operation better?—and informed the inspector that he wanted to bring charges against MediaDefender's clients: Sony, Universal, Atari, and others. Not only had they paid a company to break the Pirate Bay's terms of service—which forbid companies from tracking usage, logging IP addresses, or doing anything disruptive—but MediaDefender had created code specifically for hacking into the Pirate Bay's system. "As long as what you're doing is legal, why should you be attacked by someone using illegal methods?" asks Sunde. The Swedish police have yet to press charges.

Of course, as with many a popular movie, the underdog always mounts a comeback. And recently, some other pirates have also chosen to fight instead of run. After the M.P.A.A. filed a lawsuit against several websites in 2006, the file-sharing portal TorrentSpy countersued for illegal wiretapping, saying the trade group had amassed evidence by hiring a hacker to obtain internal documents. (A judge dismissed the countersuit; TorrentSpy is considering an appeal.) And Sunde is heading up an initiative in the file-sharing community to develop a more secure, less traceable version of BitTorrent. The new protocol, tentatively called SecureP2P, got a boost through Ethan's work: Because programmers were able to view the blueprints for MediaDefender's technology, they will be able to design an even more effective countertechnology.

From: Randy Saaf
Sent: Wednesday, May 2, 2007 1:11 p.m.
To: [various MediaDefender employees]
Subject: digg story on hd dvd crack

Look how ape shit the digg community went over the hd dvd crack code post getting pulled from the site.
http://digg.com/news/popular/24hours

People sure love their pirated movies

However Saaf and his crew intend to mount a comeback, it's clear that the war against downloading is escalating. "Hollywood is not burned out on silver-bullet technologies the way music is after years of defeat," says Eric Garland, C.E.O. of BigChampagne. "It's just 1999 for video, and the gold rush may be on now." In December, the ratings giant Nielsen announced its plans to enter the piracy-fighting business with a new service that would place traceable fingerprints on copyrighted media.

Perhaps, though, the entertainment business has it wrong. Downloaders aren't thieves; they're just rabid fans. But for the industry's perspective to change, it would have to trample long-held business practices. Hollywood would have to toss out its ability to stagger the opening of films across different media. It would also have to abandon technologies like the encryption used on HD-DVDs to prevent them from being copied or even played on certain machines. (A hacker cracked the encryption in January 2007.) And record labels would have to stop suing downloaders and continue to find other sources for revenue, like ringtones. But for the most part, the Weinsteins of the world see fighting as the only way forward.

"What should a police department do when it turns out there's been a burglary?" asks Rick Cotton, the general counsel of NBC Universal and the chairman of the U.S. Chamber of Commerce's Coalition Against Counterfeiting and Piracy. "Should the police department give up, close its doors, and say this is an impossible task? No. That's silly.

Still, a few months after the MediaDefender-Defenders played their prank, there was a sign that some in Hollywood might be shifting their thinking. A new independent movie called Jerome Bixby's The Man From Earth showed up on one of the file-sharing sites in November. The film's producers had no idea it had even been pirated; all they knew was that suddenly its popularity was skyrocketing. Their websites received 23,000 hits in less than two weeks, and the film's ranking among the most-searched-for movies on the internet movie-tracking site IMDB went from 11,235 to 15. The Week in Review is edited and published by Jack Spratts. Eric Wilkinson, the film's co-producer, wrote a fan letter to the site responsible for driving traffic to the pirated film: "Our independent movie had next to no advertising budget and very little going for it until somebody ripped one of the DVD screeners and put the movie online for all to download.... People like our movie and are talking about it, all thanks to piracy on the Net!" He requested that fans buy the DVD as well and added, "In the future, I will not complain about file sharing. you have helped put this little movie on the map!!!! When I make my next picture, I just may upload the movie on the Net myself!"

When I try reaching Wilkinson, though, I'm told that the producer is not available. Instead, the movie's director, Richard Schenkman, returns the call. "Eric was clearly being sarcastic," Schenkman says about the offer to upload the film. "That's why he put in the exclamation points." I tell him his partner certainly sounded enthusiastic about file sharing. "Look, I have mixed feelings about this," Schenkman replies. "As a filmmaker, I love that people love the movie and have seen the movie. But as a person who literally has a hunk of his own life savings in the movie, I don't want to be ripped off by people illegally downloading the movie. Some of these downloaders want to believe they're fighting the man. But we're all just people who work for a living." He acknowledges, however, that DVD sales of the film increased after the leak, and that people have even been pledging money on a site the filmmaker set up to accept donations in markets where the DVD isn't for sale. "I'm not saying I have the answers," Schenkman says.

Meanwhile, Ethan has moved on to other companies. He and his friends have a few targets in mind that don't happen to be in the entertainment industry. He told me he'd also like to quit the business altogether but hasn't been able to give up the rush it brings. No doubt, other kids are hunkering down over their keyboards to see if they can't replicate the MediaDefender-Defenders' work. And some pirate is finding new ways to disseminate the material. Eventually, Hollywood will no longer be able to continue fighting its enemies at the expense of its customers. If they can't beat them, they'll finally have to join them. That is, if they want to keep having customers.
http://www.portfolio.com/news-market...092007ab#page1





No Film Distributor? Then D.I.Y.
John Anderson

When “Bottle Shock” played at the Sundance Film Festival in January, it appeared to possess that mix so tantalizing to well-heeled indie distributors.

It had a name cast, including Bill Pullman and Alan Rickman. The director came with a track record and a critically acclaimed short film. And the story, about a small American winery that triumphed over its French competitors in a blind tasting in 1976 and changed the world’s view of California wine, was an accessible one for audiences who flocked to “Sideways” a few years back.

But “Bottle Shock” found no love among distributors in Park City, Utah. So the director, Randall Miller, is opening the film himself next week in 12 cities. With their hopes for conventional movie deals increasingly dead on arrival, more and more indie filmmakers are opting for a do-it-yourself model: self-distribution, once the route of the desperate, reckless or defiant, has become an increasingly attractive option for movies otherwise deprived of theatrical exhibition. “Ballast,” “Wicked Lake,” “The Singing Revolution” and “Last Stop for Paul” are among the indies currently or recently taking the maverick route.

The motivations can be complicated. For example, John Turturro’s “Romance & Cigarettes” was self-distributed late last year, having been left to languish after its producer, United Artists, was sold. In other cases it’s simply a matter of distributors’ tastes differing from those of the filmmakers.

But increasingly, indie filmmakers find themselves caught in a glutted marketplace with too few theaters to handle all the movies, and the basic laws of supply and demand have depressed the prices they can fetch. In 2007, even with the big Hollywood studios trimming their offerings, about 600 films were released in the United States; five years earlier that number was nearly 450, according to the Motion Picture Association of America.

While the orphan-indie route may not be the way a moviemaker dreams it will happen, do-it-yourself is better than a straight-to-DVD release — and certainly better than outright oblivion.

By going their own way, Mr. Miller (whose directing credits include “Marilyn Hotchkiss Ballroom Dancing & Charm School” and the upcoming “Nobel Son”) and his wife and co-writer, Jody Savin, retain the DVD and other rights to their dramatic comedy. They also get to control how their movie is rolled out and marketed.

The downside? “An enormous amount of work, an enormous amount of stress, no sleep and lots of people I’ve come to know and love who have given me millions of dollars,” Mr. Miller said.

But Mr. Miller and Ms. Savin said they felt they had little choice. With the rash of prominent distribution houses recently shuttered or placed in figurative foreclosure — including Paramount Vantage, Picturehouse, Warner Independent and ThinkFilm — options for the indie filmmaker are evaporating.

What remains is the slim chance of being picked up by one of the surviving “mini-majors” like Sony Classics, Fox Searchlight or the Universal-owned Focus Features, or finding themselves at the mercy of smaller distributors. While many are well regarded, most offer small cash advances (if any) in exchange for most of the rights (DVD, TV, international release), but don’t usually spend the kind of money necessary to assure public awareness and ticket sales. This, in turn, virtually precludes entree to the racks at Wal-Mart or Blockbuster, outlets without which a film’s post-theatrical existence will be one of obscurity.

“You‘ve got to have the phone numbers,” said Tom Bernard, the longtime co-president of Sony Pictures Classics. “Self-distribution is good, it can work, but filmmakers who are so innovative in making movies have to channel some of that into learning how the marketplace works.” He said major pitfalls were “carpetbaggers” and “middlemen” who may agree to represent a movie at a place like Sundance, but gravitate to the easy sale and leave their less fortunate filmmakers high and dry.

“We’re in the business of discouraging people from self-distributing,” said Gary Palmucci, general manager of the venerable Kino International, which will be releasing “Momma’s Man” on Aug. 22. That film, by Azazel Jacobs, came out of Sundance this year with the all-important buzz, and had a deal with ThinkFilm until that company’s money problems scotched it. Mr. Palmucci said Mr. Jacobs might have chosen self-distribution, but wisely didn’t because the cards are stacked: the enormous expense of opening a film in major markets like New York, the average filmmaker’s unfamiliarity with the logistics of booking a movie, the hassles in collecting money from exhibitors on time.

To help navigate the sometimes treacherous world of film distribution, Mr. Miller and Ms. Savin hired Dennis O’Connor, a former top marketing executive at Picturehouse, to serve as a consultant. Freestyle Releasing of Los Angeles has been engaged, for an upfront fee and a small percentage of the gross, to handle the physical distribution of the movie (moving prints, booking theaters, etc.). And the publicity on the film is being orchestrated by Mr. Miller, Ms. Savin and Mr. O’Connor, with others enlisted by Mr. O’Connor from among the ranks of distribution veterans.

For the possibly lucrative DVD market, “Bottle Shock” has separate deals with Fox Home Entertainment and the all-important Netflix, both of which have helped in the marketing (which ensures them a better return later). Mr. Miller also negotiated his own deals with airlines and with advertising outlets, and has worked out his own price for prints. Most significant, he raised most of the money for filmmaking and prints and advertising through private investors.

“Wealthy people are really into wine,” Miller said, laughing. “You couldn’t do this with a horror movie.”

But most indie filmmakers won’t be able to raise the $10 million Mr. Miller raised for “Bottle Shock.” Instead they will have to use more cost-effective ingenuity.

The established distributors have regular circuits in which they play their films, media outlets through which they advertise and audiences they court religiously. A self-distributed movie like “Ballast,” which is cast with African-American nonactors and is about down-and-out characters (and opens at Film Forum in October), is compelling its champions to think outside the art-house box and explore new frontiers and demographics, like black churches and Southern audiences. (The movie, which won cinematography and directing prizes at this year’s Sundance festival, had a tentative deal with IFC Films before the director Lance Hammer decided to release the film through his own Alluvial Film Company.)

“At one time distributors were paying so much money they could do anything they wanted, maybe consult respectfully with the filmmakers but essentially do what they wanted,” said Steven Raphael, a consultant on the movie. “But now there’s no money and filmmakers get resentful, so they’re taking back control.”

Neil Mandt, the director, producer and star of “Last Stop for Paul,” a comedy about two men traveling around the world sprinkling the ashes of their dead friend, had a prospective deal with Magnolia Pictures. But the distributor was interested only in a DVD release. Mr. Mandt passed.

“I will be the first to admit that I never imagined that the movie would connect as well as it did when it won a prize at 45 festivals,” Mr. Mandt said. “That’s a crazy number. Despite that, we never were approached by another company for a domestic distribution deal again.”

“Last Stop for Paul” opens next week in New York, and Mr. Mandt hopes a successful opening will lead to a larger rollout. “If all of this goes as planned,” he said, “maybe in another year we will make our money back.”
http://www.nytimes.com/2008/07/30/movies/30self.html

















Until next week,

- js.



















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