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Old 22-09-05, 06:28 PM   #1
JackSpratts
 
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Default Peer-To-Peer News - The Week In Review - September 24th, ’05



























"I swear to god, the DJ was playing Solitaire throughout the dinner and cocktail hour. It seems sort of silly to pay someone a lot of money to sit at a laptop and put on songs when we can do the exact same thing." – Future Bride Jessica Spence


"It's something that's followed me forever and today I'm going to finally admit once and for all the truth about my breasts." – Tyra Banks


"Women like to be gay. I like to be gay. They want to be happy. I try to make them happy." – Porfirio Rubirosa


"We didn't need high-quality audio to accomplish this, we just used a $10 microphone that can be easily purchased in almost any computer supply store." – Feng Zhou


"We were horrified when we first heard about the new copy-protection policy that is being implemented by most major labels, including Sony (our own label), and immediately looked into all our options for removing this from our new album." – Tim Foreman


"Historically, universities were focused on inquiry and the free exchange of information." – Richard Doyle


"I can discriminate between forms of p2p, leave some on, block others." – Monty Bannerman


"It's the most powerful privilege the government has. It's the nuclear option. It never fails." – William Weaver






































September 24th, 2005




Net Takes Power From Music's Big Four
BBC

The internet has fundamentally changed the relationship between music's so-called "big four" labels, independents and consumers, industry analysts have said.

Seventy per cent of the world's music market is controlled by four companies - EMI, Warner, SonyBMG and Universal.

The labels not only control what is released, but also influence radio and TV airplay, as well as urban and street culture.

But many in the industry - including the big four themselves - believe that the power balance is changing, due in particular to the internet.

Downloads, peer-to-peer (P2P) file-sharing, piracy, podcasting and online ad hoc radio stations - as well as a rejuvenated independent label sector and a new generation of music entrepreneurs - are shifting the power balance.

"It's rapidly changing and different to how it was 10 years ago, five years ago, three years ago, two years ago," Tom Smith, lead singer of British group Editors, told BBC World Service's The Music Biz.

The group reaped success with indie label Kitchenware after making their music available online.

"It seems to me that it means people can listen to more music, they can decide for themselves early on if they like or don't like something.

"So they can actually listen to more than they ever would listen to and then go out and buy the record."

Helping indies

Under an earlier name, Snowfield, Editors had been unsuccessful in getting a deal from a major label.

However, they began to build a fanbase through the internet, and attracting people to gigs as more people discovered the band online. Major labels then became interested, but, now in a stronger position, Editors rejected them to go with Kitchenware.

"The first record was very limited edition, and not many people could get their hands on it - but you could obviously get the songs and hear the B-sides on the internet and from various places," Smith said.

"I think that's healthy and people sharing music is healthy."

The story is similar for some small independent record labels.

In November last year, Saddle Creek become one of the most talked about and respected independent rock enterprises in the US when their act Bright Eyes - one of only 12 bands on their books - secured the top two slots in the US singles chart.

Then in January, Saddle Creek released two Bright Eyes albums simultaneously. Both were well-received critically and went on to break 100,000 sales mark.

Saddle Creek's Matt McGinn, who was part of the small group that established the label as young teenagers, said that the internet had "really helped independent music."

"I think all of our bands have seen growth due to people being able to share bands that they find and love with other people, who are then turned on to the music too," he added.

"We've put up a couple of downloads for every record we release, and that, you know, shows that we want to share some of the music just for free, just to check it out, and I think that's definitely helped."

'Out of our hands'

And Keith Jopling of the International Federation of the Phonographic Industry said digital market is very good news for independent music labels.

He explained that traditionally, it has been difficult for independents to get high marketing budgets and exposure for their artists

But he said that online, they can "have more innovative marketing concepts," as well as allowing consumers to listen to the music before they decide to buy it".

"In theory, the whole development of the market digitally should be to the benefit of independents," he added, also explaining that new consumption patterns are emerging, with music fans buying in many different ways.

"Online, people are more likely to download catalogue, they're more likely to download lesser-known bands - and that's good for independents," he said.

"What we're seeing is that for independent rock artists - indie-type bands that don't have the marketing exposure of those acts on the major labels - a higher proportion of their sales is now taken up by digital."

Rob Owen of EMI admitted that the majors were playing "catch-up," but added they were now dramatically improving.

"We didn't really know where it had come from, and I think over the past couple of years great inroads have been made by all the record companies - not just the majors but the indies as well," he said.

"Learning daily I think is the case, really. We're kind of catching up, but we're getting there."

He also defended the major label's initial fears that technology could bring them down - which made them slow to react.

"It was out of our hands," he said.

"There was the file-sharing, peer-to-peer services, illegal downloads, and they'd completely and utterly taken over what we were meant to be doing as a record industry.

"We have caught up now, and I think people are sitting up and taking notice. They know where they can get things legally."
http://news.bbc.co.uk/go/pr/fr/-/1/h...ic/4271940.stm





WinMX PNP Network Ends Operations
Thomas Mennecke

WinMX began its time as a simple OpenNap client in a time when Napster and Scour ruled the P2P scene. When Napster and Scour were banished from the Internet, WinMX's importance took on a new burden of importance. It reinvented itself from a mere OpenNap client to become one of the premier P2P networks of its day.

During its height, WinMX, developed by FrontCode Technologies, eclipsed the Napster P2P network in not only resourcefulness, but also in population. During mid- 2002, its population had reached over 1.5 million simultaneous users. With an active community, plenty of independent user forums and steady development it appeared there was nothing that could stop this network.

Then something mysterious happened. From July 2003 to July 2004, there were no updates to WinMX - nothing to improve the network architecture, the dreaded queues or any other attributes. Then in July 2004 after nearly a year of frustration, FrontCode released addition betas which many perceived as a mere "filler" versions. Version 3.53 did little more than feature “a major upgrade of the chat component and other minor improvements." Another beta version (3.54) was subsequently released, which improved the media library.

That would be the last anyone would hear from WinMX ever again. Slyck maintained communications with FrontCode president Kevin Hearn, who stated that work was still being continued on the mystical version 4.0. During the early part of the summer, Mr. Hearn told Slyck.com that something might be available towards the end of the 2005 summer.

However, another plot twist appears to have mixed things up once again. On September 13, 2005, WinMX was the recipient of a letter (along with 6 other P2P firms) from the RIAA. The letter demanded the receiving developers they cease infringing operations immediately, and offered to "discuss pre-litigation resolution of these claims."

Like Alberto Treves' decision to release the source of Ares Galaxy, or Sam Yagan's decision to join the DCIA, every move a P2P developer makes is immediately questioned to be in direct response to the RIAA's letter campaign. Such is the case for FrontCode Technologies. Or should we say WinMX Technology Associates?

Currently, the WinMX.com homepage, the FrontCode.com homepage, the WinMX PNP Network and all of its host caches are down. It is impossible to connect to the network, and those remaining online will only stay online as long as their host supernodes do. But is this the end of WinMX?

Perhaps not. Interestingly enough, if one conducts a DNS whois for "WinMX.com", the result directs owner ship to a "WinMX Technology Associates" - not FrontCode Technologies as it has in the past. Even more interesting is the geographical relocation from Toronto, Canada to Port Vila, Vanuatu. Many will remember that Sharman Networks pulled a similar stunt to avoid prosecution in the Netherlands and to capitalize on "tax efficiencies."

FrontCode.com is still registered in Canada. Kevin Hearn, who is usually readily available for comment with Slyck.com, has not responded to inquiries for several weeks.

Before anyone clamors the end of the WinMX PNP network, time needs to be given to allow for this development to unfold. Although it appears WinMX.com was reregistered prior to this event, its occurrence cannot be downplayed until this fluid situation is resolved.
http://www.slyck.com/news.php?story=921





P2P Music Sites Closing Doors In Legal Fallout
Sue Zeidler and Eric Auchard

Popular file-sharing site WinMX.com ceased operating and the New York office of another, eDonkey.com, appeared to be closed, in the continuing legal fallout among underworld peer-to-peer music services, industry sources and users said on Wednesday.

The turmoil among file-sharing networks follows the landmark ruling by the U.S. Supreme Court in June that held anyone who distributes a device used to infringe copyright is liable for the resulting acts of infringement by others.

In the wake of the decision, the trade group Recording Industry Association of America (RIAA) last week sent out "cease-and- desist" letters to seven file-sharing groups. A spokeswoman for the RIAA declined to name the targets.

Popular file-sharing sites BearShare, eDonkey and WinMX were reportedly among the targets.

The decentralized nature of most peer-to-peer file-sharing software makes it uncontrollable once it is released over the Internet. However, shutting off sites where users first download the software may strangle the flow of new users.

"There's certainly a big realignment of networks going on after the RIAA letters. Everyone is going to see a fallout since the ruling is making it tough for these companies to exist," said Marc Morgenstern, vice president for Loudeye, during the Digital Hollywood conference in Santa Monica.

An eDonkey executive with a Boston phone number was not immediately available to comment. Industry sources said the phone in the New York office had been disconnected.

A spokesman for Frontcode Technologies, developers of the WinMX application, could not be located to comment.

Users in both Europe and North America complained that the WinMX site (http://www.winmx.com)) was unavailable throughout the day on Wednesday. Free Peers Inc., backers of BearShare, did not respond to attempts to contact them via e-mail.

The latest developments come on the heels of a pending deal in which file-sharing service Grokster Ltd. is set to be acquired by Mashboxx LLC, a new company formed with the intent of establishing a legal peer-to-peer music company, sources familiar with the matter said.

A spokesman for Mashboxx, formed by former Grokster President Wayne Rosso and other partners, declined comment.

Michael Page, a lawyer for Grokster, which makes software that has been widely used to illegally swap music over the Internet, also declined to comment.

Both Grokster and Morpheus, distributed by StreamCast Network Inc., were on the losing end of the Supreme Court's ruling.

Shotgun Weddings In The Making

The Rosso spokesman declined to comment on the talks with Grokster but said he expects the Mashboxx service to launch in the next few months. Mashboxx has announced a licensing deal with Sony Corp. and is talking with other major labels.

The sources familiar with the matter said the pending deal with Mashboxx helped pave the way for settlement discussions between Grokster and the major record labels.

Michael Weiss, Morpheus's chief executive, declined to comment on whether his company had engaged in settlement discussions.

Last June, the Supreme Court sent the case against Grokster and Morpheus back to a lower courts for further action on whether or not the file-sharing networks encouraged its users into infringing action.

Weiss has said he is confident Morpheus can prove it did not induce copyright violation. On Wednesday, he said he was awaiting his next date in court in mid-October.

The current generation of file-sharing networks are all descendants of the original music-sharing phenomenon Napster, which was forced to shut down, and now operates as a legal music service.

However, peer-to-peer technology has lived on in programs like WinMX, which represent a sort of transitional generation of media- sharing programs between the pioneering Napster and more modern programs like Gnutella and eDonkey.

Despite the legal wrangling, free file-sharing has persisted and many in the industry believe it is about to embark on a new era in which it will finally be embraced commercially by media companies for legitimate purposes.

"Six months from now, P2P usage will be beyond what it is today," said Weiss during a panel at the Digital Hollywood conference.
http://news.yahoo.com/s/nm/20050922/...p_shutdowns_dc





Hollywood Taking Lab Route To Fight Piracy

With the menace of film piracy showing no sign of letting up six Hollywood studios - Disney, Paramount, Fox, Sony Pictures Entertainment, Universal and Warner will finance a multimillion-dollar research laboratory. The aim will be to find new ways to foil movie pirates.

It is to be called Motion Picture Laboratories, or MovieLabs, and is scheduled to begin operation this year. Media reports indicate that MovieLabs will have a budget of more than $30 million for its first two years. The idea arose from Hollywood's contention that the consumer electronics and information technology industries are not investing heavily or quickly enough in piracy-fighting technology.

The venture will explore new technologies to detect illegal videotaping of films in theaters and evaluate new computer hardware and software that is being used by networks to distribute films.

MovieLabs will be looking at ways to jam camcorders, detect and block P2P transfers on campus and business networks.

It will build spyware for peer 2 peer networks and look at better ways to prevent home and personal digital networks from being tapped into by unauthourised users. The lab is modelled after CableLabs, which since 1988 has spearheaded pivotal innovations in the cable television industry - hastening the adoption of fiber optics, cable modems, telephony and digital video.
http://www.indiantelevision.com/head...sep/sep228.htm





Where ya been Steve?

Jobs Says Record Labels 'Getting Greedy'

Apple Computer boss Steve Jobs, the man behind the popular iPod digital music player, called the music industry greedy for considering a hike in the price of digital downloads, warning that such a move would drive users back to piracy.

Record companies have begun rethinking how to price songs sold over Apple's iTunes Internet shop--99 cents each in the United
States and 79 pence in Britain--before new contract negotiations come up with the California-based company.

"If they want to raise the prices, it means that they are getting greedy," Jobs, chief executive of Apple, said at a news conference here Tuesday. "If the price goes up, they (consumers) will go back to piracy and everybody loses."

Hit hard over the past five years by the rapid spread of illegal song copying over the Internet, music companies are struggling to revamp their business models as sales shift to more legal digital downloads from the CD format.

Vivendi's Universal Music, Sony BMG Music Entertainment and Warner Music are responsible for three out of every four albums sold around the world.

Apple, which Jobs said had more than 80 percent of the U.S. digital music market, unveiled this month the pencil-thin iPod Nano digital music player, which is aimed at securing the company's lead.

Jon Rubinstein, senior vice president of the iPod division, told journalists the company was not planning to add radio features on to its digital player because there was not enough demand for it.

Jobs also cast a skeptical eye on the future of the market for downloading music on mobile handsets.

"It is not clear that buying songs over the air makes economic sense," Jobs said. "I am skeptical because of the cost...but we will see."

Jobs said it was cheaper for consumers to download songs onto their computer than directly onto their mobile phones.

Mobile phone operators, however, expect music downloads to be a significant driver of revenue growth after having invested heavily in technology and infrastructure to support the service.

Jobs declined to say whether Apple was planning to launch an all Apple-made iPod phone after having introduced two weeks ago a music-playing handset developed with Motorola.

"We do not say anything about future products," Jobs said. "We work on them in secret, then we announce them."

On a separate matter, Jobs said Apple was on target to ship computers fitted with Intel chips by June as targeted. "We are on track to do that."
http://news.com.com/Jobs+Record+labe...3-5874443.html





Writers Sue Google, Accusing It of Copyright Violation
Edward Wyatt

Three authors filed suit against Google yesterday contending that the company's program to create searchable digital copies of the contents of several university libraries constituted "massive copyright infringement."

The lawsuit, filed in United States District Court in Manhattan, is the first to arise from the Google Print Library program, the fledgling effort aimed at a searchable library of all the world's printed books.

Google intends to make money from the project by selling advertising on its search pages, much as it does on its popular online search-engine site.

The plaintiffs, who are seeking class-action status, also include the Authors Guild, a trade group that says it represents more than 8,000 published authors. Listed as plaintiffs in the suit are Daniel Hoffman, a former consultant in residence at the Library of Congress and the author of many volumes of poetry, translation and literary criticism; Betty Miles, an author of children's and young adult fiction; and Herbert Mitgang, the author of a biography of Abraham Lincoln as well as novels and plays. Mr. Mitgang is a former cultural correspondent and editorial writer for The New York Times.

Each of the plaintiffs claim copyright to at least one literary work that is in the library of the University of Michigan, according to the suit. Michigan is one of three universities, along with Harvard and Stanford, that agreed last year to let Google create searchable databases of their entire collections. The New York Public Library and Oxford University also entered into agreements with Google, but only for the works in their collections that are no longer covered by copyright.

Paul Aiken, executive director of the Authors Guild, said the organization did not know whether Google had yet copied any of the works by the plaintiffs. But he noted that they were seeking an injunction against copying and a declaration that the program violates copyright law, as well as damages from any violations so far.

The suit contends that Google knew or should have known that the Copyright Act "required it to obtain authorization from the holders of the copyrights in these literary works before creating and reproducing digital copies of the works for its commercial use and for the use of others."

Google has said from the beginning that its program is covered by the "fair use" provision of the copyright law, which allows limited use of protected works. In a statement issued in response to the suit, Google also said its program respected copyrights.

"We regret that this group has chosen litigation to try to stop a program that will make books and the information within them more discoverable to the world," the statement said. "Google Print directly benefits authors and publishers by increasing awareness of and sales of the books in the program. And, if they choose, authors and publishers can exclude books from the program if they don't want their material included. Copyrighted books are indexed to create an electronic card catalog and only small portions of the books are shown unless the content owner gives permission to show more."

Google temporarily suspended its library project last month to give authors and other copyright holders until November to opt out by telling it that they did not want certain works to be copied.

But Mr. Aiken said that offer turned longstanding precedents in copyright law upside down, requiring owners to pre-emptively protect rights rather than requiring a user to gain approval for use of a copyrighted work.

Some aspects of the Google Print program have encountered relatively little opposition, particularly one that invites publishers to submit their books to Google for scanning and inclusion in the Google search engine. Most of the large commercial publishing houses have submitted books to Google for scanning, in the hope that the program will lead users to find and buy their books more easily.
http://www.nytimes.com/2005/09/21/te...gy/21book.html





Chinese Search Engine Baidu to Appeal
Christopher Bodeen

Chinese search engine Baidu.com plans to appeal a court verdict ruling it violated copyrights held by a local affiliate of global music giant EMI, Baidu's lawyer said Tuesday.

Beijing's Haidian District Court found Baidu guilty on Monday, saying it provided access to Web sites offering illegal MP3 files of music belonging to recording company Shanghai Push, also known as Shanghai Busheng Music Culture Media Co.

Baidu, whose share price more than quadrupled following its listing on the Nasdaq last month, argued it merely provided a search function, not downloading services, and therefore wasn't violating copyrights.

"We believe that the district court order was based on a misunderstanding of the search engine technology and therefore is without merit," Baidu's lawyer, Li Decheng of the Zhonglun W&D Law Firm in Beijing, said in a statement e- mailed to The Associated Press.

"We will vigorously appeal on behalf of our client," Li said.

There was no telephone directory listing for Shanghai Busheng and the company's spokesmen could not be reached for comment on Tuesday.

Baidu's mp3.baidu.com MP3 search page has made it hugely popular among young, increasingly tech-savvy Chinese. Analysts say it has grown into China's largest search engine, prompting U.S. search giant Google to buy 2.6 percent of the company last year.

But its high profile has also exposed it to the ire of international record companies, such as Universal, Warner, Sony BMG and their local subsidiaries, who are trying to stem losses attributed to illegal music downloading. Baidu is facing seven separate copyright infringement lawsuits filed by the four major record labels or their affiliates over the last four months. The cases are scheduled for a hearing on Sept. 26.

Baidu's stock, which soared at its IPO on Aug. 5, slumped last week after two securities firms that underwrote its initial public offering issued reports saying its price was too high. The stock price rose 1.5 percent on Monday on the Nasdaq to $79.53 _ still almost triple the price at which it listed.

Li said the Beijing court ordered Baidu to stop providing the alleged downloading services related to songs copyrighted by Shanghai Push and pay the company 68,000 yuan ($8,395) _ 2,000 yuan ($247) for each of the 34 copyrights the company said Baidu violated.

However, he claimed that blocking access would severely interfere with Baidu's search function by forcing it to filter or block access to all files containing the same file names as Push's songs. Legitimate multimedia file owners and Internet users could be cut off from copyrighted files, he said.

"We believe the district court's order would constitute an unfair restriction on the search engine, legitimate multimedia file owners as well as Internet search users," Li said.
http://www.washingtonpost.com/wp-dyn...092000330.html





German Legal Machinery Against P2P Users Running Smoothly
Craig Morris

Thousands of charges against users of filesharing programs have been filed with the state prosecutor's office in Karlsruhe -- and guilty parties are now facing their first legal consequences. For several weeks now, the state prosecutor's office has been warning suspects in writing that "preliminary inquiries have been launched against you for a breach of copyright."
Anzeige

The letter states that charges will not be filed if the accused party agrees to settle out of court. The preliminary inquiries are discontinued if a certain amount (between 50 and 500 euros depending on the severity of the violation) is paid to the state chancellery. The accused do not have to defend themselves against the accusations. However, if they do not pay, the state prosecutor's office explains that it will "press charges against you without further notice."

For some time, several thousands of charges have been filed with the state prosecutor's office in Karlsruhe for violations of copyright in the eDonkey P2P network. Law firm Schutt-Waetke is behind the charges. In turn, this law firm has contracted Logistep on behalf of the holders of copyright to search through peer- to-peer networks for files protected by copyright. If Logistep finds any, it stores the provider's IP address and the date and time when the file was offered. These data are then transmitted to the law firm.

The "anti-piracy" investigators, as the lawyers see themselves, seem to be focusing on the Earth 2160 game from Zuxxez Entertainment of Karlsruhe. According to Zuxxez, the law firm has filed more than 18,000 charges against users of filesharing programs who are offering that game. Two weeks ago, only 12,000 cases had been filed when heise online first published a report about these events.

The law firm in Karlsruhe that is representing Zuxxez get the personal data of the accused parties from the files at the state prosecutor's office so it can press charges. Zuxxez Executive Director Dirk P. Hassinger told heise online that the purpose of this campaign is to give users of peer-to-peer networks "something to think about." After all, he points out, the fines charged only amount to around 150 euros including damages. The fines are only greater in individual cases when the accused parties are "repeat offenders."

In a written warning provided to heise online, the law firm estimates that the amount in dispute is 25,000 euros and calculates that the fee that the law firm could charge according to commonly applied rates would be 911.80 euros. The law firm explains that it is, however, "willing to meet you in the middle" and only charge 650 euros as a friendly gesture. The letter does not charge that there have been repeat offenses. The lawyer representing the party that received this letter stated that her client is not willing to pay that fee.
http://www.heise.de/english/newsticker/news/64216





The Story Of Finnish Copyright Law

Copyright law has received much attention in Finnish press for past 3 days.

The new Finnish copyright law is in its final stage in parliament. What started over 10 years ago in WIPO has lead to an evil law and citizens are protesting against it. Members of parliament are reported to receive over 600 e-mail a day about the new law and its flaws.

Citizens sending mail are terrorist

The X-minister of culture Kaarina Dromberg who was responsible for the first version of the law has been making statements that the members of parliament are victims of e-mail terrorism. The current minister of culture x-miss Finland Tanja Karpela has said that there are certain forces behind the e-mail flood. She is right. The e-mails were send by worried normal citizens. The ones that voted the members to the parliament. The ones that have enjoyed freedoms of consuming copyrighted material. The citizens that are affected deeply by the new law that takes those rights away.

The leader of left wing party Suvi Anne Siimes said in her Blog that the citizens and members of parliament are late. The law has gone through committees where there was a chance to make changes. Member of Parliament Jyrki Kasvi notices that "If a member of parliament isn't a member of the committee they have only one chance to influence the law".

Law in different committees

The law has had mixed response from different committees. The constitutional committee said that consumers have right to make private copies of works that are they have legally bought. The culture committee didn't care. They didn't care to listen to the expert study by Marja Leena Mansala who said that citizen should have a right to bring couple (less than 10) Cd's to country with out showing where they bought them and their legality. Best of all the study was commissioned by minister of culture. The new law treats citizens as criminals from the beginning. It is up to you to show that you have a right to bring a CD from the common market of EU when you come back from your trip to say London.

Corruption and lobbying behind the scenes

The law was written 2002 when Dromberg was minister of culture. She had a special adviser Lauri Kaira who is currently manager of Finnish performance rights organization Gramex. His responsibility is "outside relationships". It is like the scene in lord of the rings. The king is without power, the land is weak and the special adviser hisses his message to ear of the king. Copyright is hard for most politicians to understand. The Industry lobby had their inside man to take advantage of the fact.

The Finnish press has also found out that the civil servant Jukka Liedes (also holds a high place in WIPO) who was responsible of the copyright chapter of the ministry has been in the board of ESEK. ESEK is part of GRAMEX the organization led by Lauri Kaira. ESEK is responsible for distributing GRAMEX monies for the artists. Law professor Olli Mäenpää is saying in Tietokonelehti, that it doesn't sound right that there is such connection with the industry and the civil servant.
http://hietanen.typepad.com/copyfrau...ory_of_fi.html





No bypassing DRM

Proposed New Copyright Law Would Allow Personal Copies Of CDs, But With Restrictions

Minister of Culture to address Grand Committee of Parliament on Friday

Contrary to fears expressed by some Finnish music lovers, the government’s bill for new copyright legislation that is currently before Parliament would not actually make it illegal to copy music onto MP3 players for personal use. However, if it is passed into law, it could set up a few obstacles.

Under the proposed law, it would be permissible to copy music for personal use, but not to bypass copy protection for this purpose. Only a small percentage of CDs on the market at present are copy-protected, but the general expectation is that such protection is likely to spread. DVDs, which are increasingly being used also for music recordings, come with copy protection.

Jukka Liedes, the Ministry of Education & Culture official who headed preparation of the proposed legislation, says that the breaking of copy protection for the copying of the content of a sound or video recording for personal use would be prohibited.

At the same time, there would be no specific criminal sanctions for such an act, but a record company would be entitled to demand compensation for the illegal copying, if the matter came to light.

The breaking of copy protection to allow the performance of an original CD or DVD (for example on another device in the home or car) would nevertheless be permitted under the proposed legislation.

The copying of illegal music files from the Internet for private use would be prohibited under the new law, but once again this would not be subject to legal sanctions, according to Liedes. The copyright holder could nevertheless demand compensation from transgressors.

The bill for a new copyright law is before Parliament’s Grand Committee on Friday. The committee still has the power to make changes to the proposed law.

Speaking before the Grand Committee on Friday will be Minister of Culture Tanja Karpela, who hopes to assuage worries about perceived shortcomings of the proposed law.

The committee can either change the text of the bill, or could propose to a plenary session of Parliament the inclusion of a statement calling on the government to make changes to the law if it leads to unreasonable practices.

Karpela said on Thursday that the bill should not be changed, because an EU directive bans the breaking of copy protection.

Heidi Hautala, the chair of the Parliamentary group of the Green League, noted that the EU directive allows member states a certain amount of leeway, which Finland has not used. She criticised Karpela for being "uncooperative" in the matter.

Grand Committee Chairman Jari Vilén (Nat. Coalition) said that the committee should listen to Karpela to get more than just her initial reaction.
http://www.helsinginsanomat.fi/engli.../1101980971029





P2P Pro Given Broad Powers At New Microsoft

Redmond announces major reorganization
AP

Microsoft Corp. is reorganizing its corporate structure and giving one of its newest executives broader powers in an effort to better compete against its rivals, including Google Inc. and Yahoo Inc.

The corporate changes announced Tuesday are designed in part to help Microsoft move toward more Internet-based service offerings, which have been championed by those competitors and are seen by some as a serious threat to Microsoft's dominant Windows operating system. The moves also are aimed at helping the company become more nimble.

"These changes are designed to align our business groups in a way that will enhance decision-making and speed of execution, as well as help us continue to deliver the types of products and services our customers want most," Microsoft Chief Executive Steve Ballmer said in a news release.

Under the changes, Ray Ozzie, a highly respected software veteran who came to Microsoft when it acquired his company, Groove Networks, will be charged with helping the company coordinate and improve Internet-based service offerings. These include Windows Update, the company's online tool for issuing security fixes; its MSN consumer online unit, including Web-based e-mail, instant messenger and search technology; and its Xbox Live online videogame service.

Ozzie will retain his title of chief technical officer. He is one of three at the company.

The company also plans to reorganize from seven broad business units to three new business divisions.

Microsoft Platform Products and Services will include the company's Windows, server and tools, and MSN online divisions. It will be led by Kevin Johnson and Jim Allchin.

Allchin, a longtime executive charged with overseeing its flagship Windows operating system, will retire at the end of 2006, after the new version of Windows is released.

The other two units are Microsoft Business Divison, which will include its Office products and products for small- and mid-sized businesses, and Microsoft Entertainment and Devices Division, which will include its Xbox game console, other games, mobile phone and handheld devices products.
http://www.nytimes.com/2005/09/20/te...n er=homepage





Europe Considers New Charges Against Microsoft
Paul Meller

Almost 18 months after the European Commission ruled that Microsoft had abused its dominance in the software market, Europe's antitrust authority is considering opening new cases against the company, Neelie Kroes, the competition commissioner, said Monday.

The commission ruling resulted in a fine of 497 million euros against Microsoft and an order to change the way it sells software in Europe. The changes have not formally taken effect yet and the ruling is under appeal at the European Court of First Instance.

In an interview at her office in Brussels, Ms. Kroes said she was not going to wait for a court outcome before taking further action. "We have had informal complaints, and we are using our time now to look at them," she said, adding: "We're not going to wait and do nothing."

The informal complaints Ms. Kroes has received since taking office late last year focus on the bundling of existing applications and future ones. She refused to give details. Among the areas the new complaints might focus are on the bundling of the Office suite of software applications that include Microsoft Word, the word processing software, and Outlook, the e-mail program. These are sold as a package in most new personal computers, making it hard for rival word processors and e- mail programs to compete.

Microsoft responded Monday by saying it was keeping the commission apprised of its new products.

"We have kept the commission very closely informed of all Microsoft's plans for new technology development and we will continue to respond quickly and comprehensively to any requests for information," Horacio Gutierrez, associate general counsel for Microsoft in Europe, the Middle East and Africa, said in a statement.

Last year, Microsoft was ordered to introduce a version of Windows that excluded Media Player, the company's music and video-playing program. The aim was to prevent Microsoft from having any unfair advantage over rival music and video players.

Three months ago, Microsoft introduced Windows Edition N without Media Player, as required by the ruling.

Delays in putting last year's ruling into effect, as well as the growing suspicion that part of the proposed remedy will not have the desired effect, have left some lawyers wondering about the value of last year's antitrust decision.

Despite Ms. Kroes's assurances, she has had little success getting Microsoft to comply with parts of last year's ruling. Her antitrust officials are still assessing the company's proposals, and she could not give a date for when the commission would announce its decision, even though Microsoft submitted its technically complex proposals more than three months ago.

According to Thomas Vinje, a partner in the Brussels office of the law firm Clifford Chance, Microsoft's attempts to stall any new legal challenge to its operations in Europe have worked so far. Mr. Vinje works for the European committee of interoperable systems, or E.C.I.S., which is supporting the European Commission in the case.

"It's a typical Microsoft tactic to draw things out as much as possible, and in a way it's working because E.C.I.S. is so busy working on the appeal that it hasn't had time to submit a fresh complaint against Microsoft," Mr. Vinje said.

Ms. Kroes, who will visit New York later this week to meet with her United States counterparts, said Microsoft's stalling tactics were failing, as far as she was concerned. "We are not out of the game. We are following what's going on," she said.
http://www.nytimes.com/2005/09/20/bu...s/20trade.html





File-Sharing Services Seek Pact With Record Studios
Saul Hansell

At least five online file-sharing companies have started trying to reach an accord with the music industry to convert the free trading of copyrighted music on their networks to paid services, according to several recording industry and file-sharing executives.

The most advanced discussions are between the recording industry and Grokster, a small California company that has been sued by the entertainment industry, recording industry executives said.

Grokster has agreed in principle to be acquired by Mashboxx, a new company backed by Sony that is trying to start a legal file-sharing service, a person involved in the negotiations said. Mashboxx has made overtures to some file-sharing companies including eDonkey, Morpheus and LimeWire, but negotiations are not active, the person said.

The tentative agreement between Grokster and Mashboxx was first reported by The Wall Street Journal. MashBoxx would make a nominal payment for Grokster, but would share future revenue, the person involved in the negotiations said.

"We are looking at a number of acquisitions," said Wayne Rosso, the founder of MashBoxx, "but they have to make sense."

Michael Page, a lawyer for Grokster, did not return calls seeking comment.

Separately, iMesh, a file-sharing service that last year reached an accord with the music industry to convert to a legal paid service, has made overtures to acquire a number of the other file-sharing services, on the condition that they settle their claims with the recording industry, said Robert E. Summer, the executive chairman of iMesh.

"We have initiated discussion with a number of well-known players," Mr. Summer said. He said it was difficult to say which, if any, of those discussions would lead to acquisitions, in part because of the complexity of potential deals with the recording industry.

Mr. Summer declined to say how much money iMesh was offering the other services, but said "I don't think anyone will get rich off these deals." Rather, he thinks that such arrangements offer the owners of those services the ability to avoid litigation.

Such acquisitions, he said, "are good for iMesh and good for the industry." Mr. Summer is the former president of Sony Music International and former president of RCA records. He was hired by the founders of iMesh, which has moved to New York from Israel, to oversee relations with the record industry.

IMesh has agreements with all the major record labels and plans to introduce its service to consumers "imminently," Mr. Summer said.

Mashboxx announced a deal with Sony in June that would allow Mashboxx to sell Sony's music on its network. The company is in talks with other record labels, Mr. Rosso said. He hopes to introduce a public test of the service in December. He served as president of Grokster from 2001 until 2003 and remains close to Daniel Rung, the California entrepreneur who founded and owns Grokster.

The recording industry was handed more legal leverage in June when the Supreme Court ruled, in MGM v. Grokster, that the owners of file-sharing services can be held liable for contributing to the infringement of copyrights under certain circumstances. The case, which has both Grokster and Streamcast Networks, the owner of Morpheus, as defendants, was sent back to a lower court for further action. Last week, the Recording Industry Association of America sent letters to several file-sharing services, including LimeWire, eDonkey, and BearShare. The letters demanded that the companies stop allowing users to trade copyrighted files and invited them to discuss potential settlements in advance of litigation. A majority of the recipients of those letters have initiated at least preliminary settlement discussions, according to a recording industry executive.

Jenni R. Engebretsen, a spokeswoman for the recording association, confirmed that those letters were sent but declined to discuss any negotiations that have resulted.

Record industry and file-sharing executives say that the recording industry is looking for settlements that resemble its deal with iMesh, which paid $4 million in damages and promised to convert to a paid service that blocked the trading of copyrighted files without the permission of the copyright owner. None of the executives would discuss the amounts that the industry has been asking in the most recent settlement discussions.

"Ever since the Grokster decision, we have been thinking about what our next iteration should be and obviously the letter last week made that process more urgent," said Sam Yagan, the president of MetaMachine, which distributes eDonkey. He said he had talked to both iMesh and MashBoxx but had not decided whether to sell the company, to offer his own legal service, or to continue to fight the record industry.

Mark Gorton, the chief executive of LimeWire, said his company had not decided how to respond to the recording industry's letter. He declined to discuss any prospective acquisition offers. Michael Weiss, the chief executive of StreamCast, declined to comment on potential deals with iMesh or Mashboxx. BearShare executives did not return calls for comment.

While iMesh has taken nearly a year to develop its paid service - allowing free trading of files in the interim - the industry is likely to demand that other services stop free file-trading relatively quickly. That will require complex software development and business negotiations.

File-sharing services allow users to download files from each other's computers. Both iMesh and Mashboxx intend to use technology that examines files being downloaded and compares them with a master list of copyrighted files provided by record companies. If a user tries to download a copyrighted file, the download may simply be blocked or the user may be asked to pay a fee as with services like Apple's iTunes Music Store.

Both iMesh and Mashboxx have developed methods they hope will help lure users accustomed to free music into paying for songs. Mashboxx will allow users to download files free at low quality several times before being forced to pay for the song. Mr. Summer declined to detail iMesh's marketing plan, but music industry executives say it involves offering a long free trial of a subscription service, which allows users to listen to an unlimited number of songs for a fixed monthly fee.
http://www.nytimes.com/2005/09/20/te...0grokster.html





Mashboxx Appoints Music Industry Insider As CEO

Rosso becomes chairman
Tony Smith

Mashboxx, the legal P2P software provider, has appointed a former Napster and Universal Music Group executive as President and CEO.

Wayne Rosso, the colourful current incumbent, will become chairman, handing over the running of the company he founded to Mike Bebel, The Register has learned.

Bebel is a something of a music-industry insider. He has been a senior VP at Universal Studios, and co-founded Universal Music Group's elabs venture. He went on to run Pressplay, the digital music distribution business set up by Universal and Sony, as CEO.

Pressplay was later acquired by Roxio, which subsequently bought the Napster name and used Pressplay as the foundation for its licensed music download business. Bebel became the Napster division's President and COO, a role he quit last year.

Despite his move to offer a legitmately licensed peer-to-peer operation, Rosso, as one-time head of P2P software provider Grokster, isn't exactly one of the music industry's best buddies. With so many P2P services now going offline in response to the Recording Industry Ass. of America's cease-and-desist requests, Rosso undoubtedly reckons it's now time to give Mashboxx a public face untarnished by the first file-sharing era and one the major labels will feel confidendent in dealing with.

Someone, in other words, who is 'us' not 'them'.

Rosso's goal with Mashboxx was to create a legal P2P service that would nonetheless co-exist with the questionable ones. The RIAA's actions, fueled by the US Supreme Court's judgement against Grokster and StreamCast, leaves Mashboxx's as-yet-unlaunched network in a vacuum, at least until other legal P2P services come on stream. Indeed, Mashboxx itself may yet prove Grokster's saviour, and we can't help wondering if that's not, at least in part, behind Rosso's change of role.

"I am completely confident that Mike will not only take us to market successfully, but build Mashboxx into a long term meaningful entity in the digital entertainment delivery realm," Rosso told The Register by email today.
http://www.theregister.co.uk/2005/09...oxx_reshuffle/





It's A Nice Day For An iPod Wedding
Alorie Gilbert

As a bride-to-be, Jessica Spence was taking extra care to note the details at a friend's wedding recently.

One thing that stood out to her was an idle-looking DJ who hit a few buttons on his laptop and appeared to take the rest of the night easy.

"I swear to god, the DJ was playing Solitaire throughout the dinner and cocktail hour," Spence noted in an online forum at wedding-planning site TheKnot.com. "It seems sort of silly to pay someone a lot of money to sit at a laptop and put on songs when we can do the exact same thing."

With their confidence in wedding DJs dented, Spence and her fiance are counting on their iPod to provide the musical entertainment at their wedding reception in Minneapolis later this month. They're among a growing number of couples making personal music players a central part of their big day.

Keeping wedding budgets in check is one reason couples are going the digital-DJ route. According to wedding-planning guide Bridal Bargains, professional DJs charge an average of $600 per wedding. A live band can run upwards of $1,000. If a couple has already plunked down $300 or so for an iPod or an iRiver, and spent hours refining their digital-music collection, it's easy to see why a DJ might seem superfluous.

"What could be easier?" said Lori Leibovich, editor of IndieBride.com, a Web site for brides. "You bring it, you program it, it sounds great. It doesn't surprise me at all that more people are doing it."

Do-it-yourself wedding music has emerged as a popular discussion topic on IndieBride's discussion forums, as well as those at TheKnot.com. In another signal that the trend is on the rise, the latest edition of the best-selling book "Bridal Bargains" features a section on "the iPod wedding."

Celebrities are looking into iPods as DJs, too. Rock star Alanis Morissette, who's engaged to actor Ryan Reynolds, has said during recent interviews that she may use an iPod at her wedding next year.

Indulging your inner DJ

Saving money obviously isn't the only motivation. Many couples view their wedding music as an opportunity to express themselves and put a personal stamp on their event. A digital-music player seems to set a more relaxed tone, too, one bride-to-be said.

"I think it will really add to the feel of the night not being so staged," said Emily Mighdoll, who is planning to use an iPod at her wedding next year in Delray Beach, Fla. "There's music, but no one will be telling us what to do the whole night. It's also sort of neat being able to control a piece of how the party goes."

It's also the ultimate way to indulge a bride or groom's inner disc jockey. Grooms, in particular, find that aspect appealing, Mighdoll said.

"My fiance is definitely an audiophile and has tons and tons of music--anything we'd want a DJ to play and more," she said. "He's definitely selecting the playlists." (Mighdoll, however, said she's retaining veto power over the song selection.)

But do-it-yourself wedding music is not as simple as it might sound. For one thing, most couples find that they need to borrow or rent a sound system, including speakers, amplifiers, cables and a microphone. Rental costs can easily exceed $100.

Couples may also want to ask a trusted friend or family member to play MC and manage music transitions from dinner to dancing. Others advise using a laptop to sidestep some of pocket-size players' limitations, such as some iPods' 2-or 3-second pause between songs. Backing up music to a CD in case of a technical malfunction is also not a bad idea.

Music selection can also be tricky, a former radio DJ writes on IndieBride's online forum. "From a DJ's perspective, the music is not for you," she writes. "You are not playing your favorite songs. You are playing songs people want to hear and that people want to dance to."

She recommends sticking to crowd pleasers like "YMCA" by the Village People and "Whip It" by Devo.

Professional DJs say all of this detail is too much for most amateurs to handle. That's why the technology isn't putting any DJs out of business, said Jim Tremayne, editor of DJ Times magazine.

"A good, experienced, professional mobile DJ will offer more than music selection," Tremayne said in an e-mail interview. "That DJ will offer the timing that an iPod can't. He'll do introductions. He'll play the music at the exact time that you want. He'll offer the expertise of someone who's done this hundreds of times."
http://news.com.com/Its+a+nice+day+f...3-5874790.html





Credit Card Battle Hits Stalemate
James Kelleher

SECURITY experts at the world's two biggest credit-card associations said the battle against internet-based thieves had reached a stalemate and the industry would have to spend millions of dollars over the next decade just to keep up with the criminals.

John Shaughnessy, senior vice president for fraud prevention at Visa USA and Suzanne Lynch, vice president for security and risk services at MasterCard International, said that organized crime rings - with the help, in many cases, of former Soviet KGB cryptographers - were successfully using the internet and "crimeware" software programs to circumvent the defences credit-card issuers erected against them.

The picture they presented of an escalating struggle between commerce and criminality offered little hope of quick relief for consumers worried about identity theft or for investors in card-issuing banks concerned about security's escalating costs.

The credit-card companies were battling loosely knit, elusive criminal networks responsible for much of the fraud, they said.

"They're very, very good at what they're doing," Mr Shaughnessy told the Bank Card Conference, "and they're a few steps ahead of us in a couple of areas. They've done their homework about the payments system and because of (them) we all have a chance to lose some sleep at night."

Mr Shaughnessy said FBI data showed the number of internet-related credit-card crime reports rose 66 per cent in 2004 and the average reported loss associated with the online scams tripled to $US2,400 from $US800 in 2003.

Part of that jump reflects the rise of business done on the internet, but part of it also reflects the increasing sophistication of the criminals.

"We build a 10-foot wall," Ms Lynch said, "and the bad guys build an 11-foot ladder".

While the criminals are increasingly savvy, in many cases they were inadvertently helped by sloppy security policies within the payment chain itself - and by slip-ups by merchants, third-party processors or the credit-card companies themselves.

"I will say that of all the hacks we've seen - and we've seen hundreds and hundreds of these - had the third-party been in compliance (with association rules), they probably wouldn't have been hacked," Mr Shaughnessy said.

He said Visa and others were looking at ways of protecting data so that even if a consumer's credit card information was compromised, it would be useless to the criminal. But he warned it would take many years, and lots of money, to set up such a system.


"This is going to take big investments over a number of years and we're talking hundreds of millions of dollars to come up with a secure system," he said. "Maybe 10 years from now we'll have it solved . . . It's a tough situation."
http://australianit.news.com.au/arti...-15319,00.html





Surveillance

Crave Privacy? New Tech Knocks Out Digital Cameras
Michael Kanellos

Researchers at the Georgia Institute of Technology have come up with an inexpensive way to prevent digital cameras and digital video cameras from capturing that secret shot.

The technology they've devised detects the presence of a digital camera up to 33 feet away and can then shoot a targeted beam of light at the lens, according to Shwetak Patel, a grad student at the university and one of the lead researchers on the project.

That means that someone trying for a surreptitious snapshot of, say, a product prototype or an amorous couple gets something altogether less useful--a blurry picture (or a video) of what looks like a flashlight beam, seen head on. (A video of how the system works can be viewed here.)

The group has developed a lab prototype--which consists of a digital projector with a modified video camera mounted on top--but will soon design a device that could be manufactured and sold commercially. The group, which presented a paper on its work at Ubicomp (The Seventh International Conference on Ubiquitous Computing) in Tokyo last week, is also in contact with large consumer electronics manufacturers.

Though photo-foiling gadgets are one possibility, the technology might also eventually be incorporated into digital projectors and other devices as a feature.

The Georgia Tech researchers aren't alone in their pursuit. Tech giant Hewlett-Packard, for one, has applied for a patent on technology that could remotely cause blurry pictures in digital cameras, but it requires putting additional circuitry inside the camera. HP and others are also working on projection technology meant to stymie video piracy.

The technology is a stab at ameliorating the privacy problems that have arisen with the advent, quick ubiquity and tiny dimensions of digital cameras. Nearly 85 percent of cell phones in Japan come with built-in digital cameras, and the figure for North America and Western Europe is supposed to rise to 80 percent by the end of next year, according to market researcher Gartner.

"It certainly is a concern, and it has been a concern since cameras have gotten really small," said Steve Baker, an analyst at NPD Group. "It is a lab trick that has some real-world application."

Companies commonly confiscate digital cameras temporarily from visitors coming to their labs or confidential meetings. "But you can't confiscate a phone. Someone might be expecting an important call," Patel said.

Many companies also maintain strict no-photography policies in quasi public places. Someone trying to take pictures inside a Wal-Mart or an electronics boutique will immediately draw a warning, or expulsion. Conferences also have similar rules. Patel himself got in trouble trying to take a picture of a "No Photography" sign to illustrate where theinvention could be used.

"If it is a big exhibit hall, it is impossible to confiscate all of the cameras," said Patel.

How it works

The Georgia Tech system essentially exploits the "retroreflective" property of digital camera lenses. When light strikes a retroreflective surface, a portion of the light bounces back to the original source. While eyeglasses, bottles, watches and other glass surfaces are retroreflective, a coating on virtually all digital camera lenses puts cameras in a class of their own.

"The film atop lenses (is) highly reflective," said Patel. "A lot of people probably have known this but they haven't thought about leveraging it."

In this system, a device bathes the region in front of it with infrared light. When an intense retroreflection indicates the presence of a digital camera lens, the device then fires a localized beam of light directly at that point. Thus, the picture gets washed out.

The neutralizing light continues until the camera lens can no longer be detected, which prevents video cameras from capturing clear footage.

For added security, the system emits light beams in a pattern that prevents cameras from compensating for the light. (In the lab prototype, the video camera, with its built-in infrared beam, serves as the camera detector, while the projector is the neutralizer.)

The technology can detect and block multiple cameras and works on cameras with either CCD or CMOS imagers, which are used in the vast majority of digital cameras.

The neutralizing light is also highly focused to minimize distractions. "We only light up pixels where the reflection is coming from," Patel said.

More work lies ahead for the researchers. The current implementation works indoors and only up to certain distances--it's effective at a range of up to 10 meters and covers a 45-degree area. Cameras close to the detector and at a sharp angle can fall into an undetectable dead zone. Fast shutter speeds might also present some challenges, as do filters, though it turns out that the camera detector can spot lenses cloaked with infrared filters.

While the prototype relies on a digital projector for the neutralizing light source, the group believes it can also use a laser pointer and two mirrors to foil photographers.

"That will make it a lot cheaper to do," Patel said.

The prototype is also rather indiscriminate--it knocks out whatever it believes to be a camera. Some companies have released antiphotography tools, but those tools work only if the camera or cell phone has a Bluetooth chip--and then only if the gadgets are preprogrammed to shut down when the chip receives a "no photographs" message.

So the broad nature of the Georgia Tech system is a good thing, Patel said. "It doesn't require cooperation of the camera."
http://news.com.com/Crave+privacy+Ne...3-5869832.html





Roberts Vote May Delay Data Security Debate
Anne Broache

A trio of personal data security bills likely won't get attention from the Senate Judiciary Committee until next week, a committee representative said Tuesday. Instead, much of the committee's Thursday business meeting will be devoted to a decision on Judge John Roberts' Supreme Court nomination and continued work on a habeas corpus measure.

Still up for consideration are the sweeping Personal Data Privacy and Security of Act of 2005 and two shorter proposals, all of which propose prompt notification when security breaches occur, award increased regulatory power to the federal government, and set minimum standards for data security. The measures have appeared on the committee's executive business meeting agendas since before Congress' summer recess but have not yet come up for debate.
http://news.com.com/Roberts+vote+may...3-5874811.html





EU Lawyers Slam Data Retention Proposal

Draft would have public pay for state surveillance

European Council and Commission lawyers say a controversial plan for retaining telephone and Internet data, proposed last April by the UK and several other Member States, is partly illegal.

Both legal services say that provisions in the draft Framework Decision, which would oblige telcos to retain phone and Internet data, would be illegal. This, they argue, is because the matter should instead be dealt with under EC internal market laws regulating telecommunications.

In fact, a controversial EC Directive of 2002 already covers this issue by leaving member states the option of requiring telecoms service providers to retain public data for use by law enforcement agencies. The proposed Framework Decision would go further by forcing member states to impose such requirements on telcos and by detailing the precise obligations that must be imposed.

However, the two legal services did not address whether or not the proposed measures would infringe the right to privacy. As a prior Statewatch analysis showed, the initial proposal suffered from profound and fundamental flaws.

In light of these flaws, Statewatch says the initial proposal cannot be justified in light of the right to privacy guaranteed by the EU Charter of Fundamental Rights, the general principles of EU law, Article 8 of the European Convention on Human Rights, national constitutions and other international human rights treaties.

But if the proposed Framework Decision is split into two measures, as suggested by the legal services, the European Parliament will be able to show its concerns about the right to privacy. Parliament could then either veto the draft Directive or make fundamental changes to it, in order to ensure that this fundamental human right is protected.

This would also be an opportunity for the European Parliament to insist on a proper initial impact study, to assess whether the huge cost which the proposal would entail for an industry crucial to Europe's economic growth can be justified, in light of the less intrusive but more effective measures that could be taken to focus police investigations on people who are reasonably suspected of involvement in serious crime - instead of mass surveillance of the entire society.

Statewatch editor, Tony Bunyan, says: "The proposal should be withdrawn as the law enforcement agencies have all the powers they need. If it goes ahead and the costs are borne by the communications industry we will all end up having to pay to be placed under surveillance by the state!"
http://europe.tiscali.co.uk/index.js...ntent=38 6332





EU Sets New Plan On Data Retention
Kevin J. O'Brien

The European Commission, seeking to break a four-year deadlock over anti-terrorist legislation that would require telephone network operators and Internet service providers to keep detailed data on their customers, proposed a compromise Wednesday that tries to overcome lingering privacy and cost concerns.

Experts were divided over whether a proposal by the EU justice minister, Franco Frattini, to retain Internet traffic data for six months and phone records for one year would break the impasse, which has pitted law enforcement officials against privacy advocates and telecommunications companies since the Sept. 11, 2001, terrorist attacks in the United States.

The latest push for movement on the data retention proposal followed this summer's bombings in London. It shortens the length of time records would need to be stored and takes into account the cost to companies of doing so.

Frattini, speaking at a news conference in Brussels, said the commission's proposal, which would require approval by the European Parliament and the Council of Ministers, would help both law enforcement officials and protect privacy concerns.

Frattini said the EU could no longer "allow safe havens in Europe" caused by a diversity of national laws that might allow terrorists to escape.

"This package is not only a data-retention package but a data-protection package as well, " he said.

The EU's 25 countries have no unified law on data retention.

There are some members, like Germany, that impose no legal requirement on operators at all, and others, like Italy, that require them to keep the records for up to four years.

Frattini offered his compromise after EU justice and home affairs ministers meeting informally on Sept. 8 in Newcastle, England, split over their separate plan to mandate a one-year retention of Internet traffic and three years for phone records. He said he hoped to negotiate an agreement before the end of the year.

Privacy advocates and telecommunications operators reacted cautiously - if not downright warily - to his plan.

"I don't think this means that Europe is moving forward on creating a data retention law any time soon. I think the chances are still slim at best," said Gus Hosein, a lecturer in technology policy at the London School of Economics and member of Privacy International, a London-based group that opposes data retention. "This latest plan only further muddies the issue."

Michael Bartholomew, director general of the European Telecom Network Operators Association, an industry group that represents 41 telecommunications companies in 34 European countries, said European network operators already routinely cooperate with law enforcement officials, providing them on a case-by-case basis with information that operators collect in the normal course of business.

The EU proposals, if adopted, would require operators to collect much more extensive data, such as the destination of calls that didn't get an answer and the locations of cells from which mobile calls were placed. Bartholomew said that would require some operators to reconfigure their networks.

"The proposal goes much further than the current practice in the types and duration of data to be collected," Bartholomew said. "We are asking that there first be more consultation at EU levels with the industry to ensure that any adopted measures are feasible, proportionate and effective."

Martin Selmayr, a spokesman for the European Commission's Information Society and Media directorate, which collaborated with Frattini on the latest proposal, said the EU would reimburse telecommunications companies and Internet service providers for the costs of retaining data under the new plan - something that is not addressed under the plan being considered by justice and home affairs ministers.

Selmayr said estimates of the costs to companies ranged from 50,00, or $60,000, per network operator per year to "several millions of euros."

Under Frattini's plan, EU telecommunications operators would be required to keep data that would identify the times, locations and identities of callers, but not the content of the conversations or text messages. Likewise, Internet access companies would be required to keep data that identified individual computer users, their devices, their locations and the Web sites they visit but not the contents of the Web pages or of their e-mail messages.

Hosein of Privacy International said EU parliamentarians were unlikely to approve any form of data retention because of conflicts with European national privacy laws that are far more restrictive than in the United States, which he said does not mandate data retention.

"This type of data retention would never fly in the United States because of privacy concerns and because the industry would not allow it," said Hosein, who is American. "Even in the U.S., the Department of Homeland Security has not been able to mandate this type of retention measure."

The British government, which holds the revolving EU presidency until the end of the year, said Wednesday it was committed to pushing through a law this year, even though recent attempts to mandate data retention nationally in Britain have failed.

A spokesman for the British Home Office, which has been spearheading efforts by the EU justice and home affairs ministers to pass the stricter retention law, said it was prepared to consider Frattini's proposal.

"We will consider the commission proposal carefully to see whether it meets member state requirements," the spokesman said. "We are taking the offer of a deal seriously, but will only proceed if the right deal is on the table."

Overcoming national differences could prove difficult. In Germany, for example, state privacy regulators in Hamburg, the home of AOL Deutschland, are in conflict with German federal regulators in Berlin over data retention, with state law requiring no retention at all and federal law allowing for retention for up to six months.

The conflict, for example, has prevented Internet service providers in Germany from selling services that alert customers by SMS when friends who are also customers of the same service are located by the network and found to be within a certain distance of the caller.

Andreas Koenig , the European sales manager for Network Appliance, a company based in Sunnyvale, California, that sells data storage hardware and software to European network operators such as Deutsche Telekom, Vodafone, Orange and British Telecom, said Frattini's offer that the EU pick up the costs might relieve the financial burden on network operators and eliminate their opposition to the proposal.

"What is good is that under the new proposal, the EU would pick up the costs, not the consumer," Koenig said.
http://www.iht.com/articles/2005/09/...iness/data.php





NSA Granted Net Location-Tracking Patent
Declan McCullagh

The National Security Agency has obtained a patent on a method of figuring out an Internet user's geographic location.

Patent 6,947,978, granted Tuesday, describes a way to discover someone's physical location by comparing it to a "map" of Internet addresses with known locations.

The NSA did not respond Wednesday to an interview request, and the patent description talks only generally about the technology's potential uses. It says the geographic location of Internet users could be used to "measure the effectiveness of advertising across geographic regions" or flag a password that "could be noted or disabled if not used from or near the appropriate location."

Other applications of the geo-location patent, invented by Stephen Huffman and Michael Reifer of Maryland, could relate to the NSA's signals intelligence mission--which is, bluntly put, spying on the communications of non-U.S. citizens.

"If someone's engaged in a dialogue or frequenting a 'bad' Web site, the NSA might want to know where they are," said Mike Liebhold, a senior researcher at the Institute for the Future who has studied geo-location technology. "It wouldn't give them precision, but it would give them a clue that they could use to narrow down the location with other intelligence methods."

The NSA's patent relies on measuring the latency, meaning the time lag between computers exchanging data, of "numerous" locations on the Internet and building a "network latency topology map." Then, at least in theory, the Internet address to be identified can be looked up on the map by measuring how long it takes known computers to connect to the unknown one.

The technique isn't foolproof. People using a dial-up connection can't be traced beyond their Internet service provider--which could be in an different area of the country--and it doesn't account for proxy services like Anonymizer.

Geo-location, sometimes called "geo-targeting" when used to deliver advertising, is an increasingly attractive area for Internet businesses. DoubleClick has licensed geo-location technology to deliver location-dependent advertising, and Visa has signed a deal to use the concept to identify possible credit card fraud in online orders.

Digital Envoy holds a patent on geo-location, and Quova, a privately held firm in Mountain View, Calif., holds three more, one shared with Microsoft.

"It's honestly not clear that there's anything special or technically advanced about what they're describing," Quova Vice President Gary Jackson said, referring to the NSA's patent. "I'd have to have our technical guys read it, but I don't think it impacts us in any way."
http://news.com.com/NSA+granted+Net+...3-5875953.html





Keystrokes Reveal Passwords to Researchers
AP

If spyware and key-logging software weren't a big enough threat to privacy, researchers have figured out a way to eavesdrop on your computer simply by listening to the clicks and clacks of the keyboard.

Those seemingly random noises, when processed by a computer, were translated with up to 96 percent accuracy, according to researchers at the University of California, Berkeley.

''It's a form of acoustical spying that should raise red flags among computer security and privacy experts,'' said Doug Tygar, a Berkeley computer science professor and the study's principal investigator.

Researchers used several 10-minute audio recordings of people typing away at their keyboards. They fed the recordings into a computer that used an algorithm to detect subtle differences in the sound as each letter is struck.

On the first run, the computer had an accuracy of about 60 percent for characters and 20 percent for words, said Li Zhuang, a Berkeley graduate student and lead author of the study. After spelling and grammar checks were deployed, the accuracy for individual letters jumped to 70 percent and words to 50 percent.

The software learned to improve as researchers repeatedly fed back the same recordings, using results of spelling and grammar checks as a gauge on correctness. In the end, it could accurately detect 96 percent of characters and 88 percent of words.

''If we were able to figure this out, it's likely that people with less honorable intentions can -- and have -- as well,'' Tygar said.

Researchers said there is some limitation to their technique. For one, their work did not take into account the use of a computer mouse or the ''shift,'' ''control,'' ''backspace'' or ''caps lock'' keys. They did, however, describe approaches for taking those into account.

The use of a computer mouse is another challenge, the researchers said.

The Berkeley research builds on the findings of an International Business Machines Corp. study in which 80 percent of text was recovered from the sound of keyboard clicks.

The IBM team, however, relied on controlled conditions such as using the same keyboard and training the software with known text and corresponding sound samples.

Bruce Schneier, chief technology officer of Counterpane Internet Security Inc., called the study ''a great piece of research.'' He said audio eavesdropping is just one of many possible techniques to spy on PC users.

''If the bad guys can get access to your physical space, they can eavesdrop on your stuff,'' he said. ''They can install a camera or a keyboard logger on the wire. They can install a microphone.''

The Berkeley researchers built their system using off-the-shelf equipment.

''We didn't need high-quality audio to accomplish this,'' said Feng Zhou, another Berkley graduate student and study author. ''We just used a $10 microphone that can be easily purchased in almost any computer supply store.''

The Berkeley researchers, part of the Team for Research in Ubiquitous Secure Technology, will present their results Nov. 10 at a computer and communications security conference in Alexandria, Va.
http://www.businessweek.com/ap/finan...h_down&chan=tc





Verizon wireless, records vendor settle

Tennessee Firm Will Stop Selling Data on Cellular Telephone Customers' Calls
Jonathan Krim

A Tennessee company will stop selling personal cell phone records of individuals over the Internet and will provide information on how it acquired such data under an agreement reached last week with Verizon Wireless.

The firm, Source Resources Inc. of Cookeville, Tenn., was among dozens of companies advertising that for fees starting under $100, they would provide records of calls placed to and from any phone user.

Call records frequently are used by law enforcement, which obtains them through court orders. But small data brokers and private investigators have made a business of getting and selling the information online, often acquiring the information using deceptive or illegal practices, according to experts.

Although phone records cannot lead to the type of financial fraud that can result when other types of personal data are stolen, experts said they can be exploited by criminals, such as stalkers or abusive spouses trying to locate their victims.

Wireless carriers say cases of purloined records are rare and that they take measures to safeguard the information. But the Electronic Privacy Information Center, a leading privacy rights group, last month urged the Federal Communications Commission to crack down on carriers for having inadequate security.

Verizon Wireless sued Source Resources in July, after a Verizon Wireless customer complained that his records had been obtained from Source Resources without his permission.

Officials at Source Resources did not return messages seeking comment.

Verizon Wireless spokesman Jeffrey Nelson said that the information was obtained through a commonly used tactic known as pretexting.

The companies that sell the records impersonate actual customers, using private data provided by the people seeking to buy the information. Nelson said the company is continually updating its procedures and training of call-center employees to guard against pretexting.

And he said Verizon Wireless is looking forward to learning more about the various sources of call records and how they are acquired.

"If you are one of these companies that are stealing people's identities, you better sleep with one eye open," Nelson said.
http://www.washingtonpost.com/wp-dyn...091901693.html





Tesco Stocks Up On Inside Knowledge Of Shoppers' Lives

· Crucible database is exhaustive - and secret
· Government bodies are tapped for information

Heather Tomlinson and Rob Evans

Tesco is quietly building a profile of you, along with every individual in the country - a map of personality, travel habits, shopping preferences and even how charitable and eco-friendly you are. A subsidiary of the supermarket chain has set up a database, called Crucible, that is collating detailed information on every household in the UK, whether they choose to shop at the retailer or not.

The company refuses to reveal the information it holds, yet Tesco is selling access to this database to other big consumer groups, such as Sky, Orange and Gillette. "It contains details of every consumer in the UK at their home address across a range of demographic, socio-economic and lifestyle characteristics," says the marketing blurb of dunnhumby, the Tesco subsidiary in question. It has "added intelligent profiling and targeting" to its data through a software system called Zodiac. This profiling can rank your enthusiasm for promotions, your brand loyalty, whether you are a "creature of habit" and when you prefer to shop. As the blurb puts it: "The list is endless if you know what you are looking for."

This publicity material was, until recently, available on the website of dunnhumby, but now appears less forthcoming. Attempts by a number of Guardian reporters to retrieve their own personal information under the Data Protection Act led to a four month battle; the request was ultimately denied so the Guardian has appealed to the Information Commissioner. Tesco has provided some personal data held by Clubcard, the loyalty scheme that monitors members' shopping and which has been credited with fuelling the supermarket group's astronomical growth in the past decade.

But as far as Crucible is concerned, the company admits it has "put great effort into designing our services" so information is classed in a way that circumvents disclosure provisions in the Data Protection Act. Clues about the content of dunnhumby's database have appeared in the company's marketing literature. Crucible, it says, is a "massive pool" of consumer data. "In the perfect world, we would know everything we need to know about consumers. We would have a complete picture: attitudes, behaviour, lifestyle. In reality, we never know as much as we would like." But Crucible, it suggests, has got much further than rival systems by pooling data from several sources and then using the vast Clubcard data pool to profile customers.

Together, Crucible and Zodiac can generate a map of how an individual thinks, works and, more importantly, shops. The map classifies consumers across 10 categories: wealth, promotions, travel, charities, green, time poor, credit, living style, creature of habit and adventurous.

A "Mrs Pumpkin" is cited: she makes pennies work when she shops, mostly uses cash, has a steady repertoire of products but experiments with the new, shops at various times, spends a little more on eco-friendly items, is involved with charitable giving, is rarely away and likes promotions for things she buys.

How does Tesco get the information? Clubcard is used to target promotions at particular cardholders. But Crucible is separate and Tesco insists that while loyalty scheme data is used by Crucible it does so anonymously rather than a house-by-house, name-by-name basis.

Dunnhumby's chairman, Clive Humby, offers a few more clues. Companies such as Experian, Claritas and Equifax have databases on individuals and Crucible collects from them all. Any questionnaire you may have completed, any reader offers you responded to, are bought to build up a picture of attitudes and habits. Crucible also trawls the electoral roll, collecting names, ages and housing information. It uses data from the Land Registry, Office for National Statistics and other bodies to generate a profile of the area you live in. Zodiac is employed to provide a more detailed profile. The combination is valuable to many consumer goods firms: dunnhumby generated profits of £4m on sales of £28m in the last year for which accounts are available. Some £12m of business was done directly with Tesco.

Mr Humby and Edwina Dunn founded dunnhumby. The two have a reputation as shrewd operators in the marketing industry and still own shares in the firm alongside Tesco's majority stake. How the supermarket group and other customers use the data is less clear. One former employee involved in the company's marketing told the Guardian that it can be used to decide how to target offers to individuals or where to open new stores.

A Tesco spokesman said last night: "All work carried out by dunnhumby is regulated by the Data Protection Act and the Direct Marketing Association Code of Practice." But, as the supermarket unveils yet another set of sparkling half-year figures today, one thing is clear: while past success may have been built on the company knowing its customers, Tesco plans to secure its future by knowing everyone else's customers as well.

Profile of an upmarket C10 deserter

When it comes to my personal information, I'm a natural paranoid. So when signing up for a Tesco Clubcard to get those cashback vouchers and offers, I made a point of providing as little information as the application would allow.

No matter. According to Tesco's disclosures under the Data Protection Act (DPA), in the year my card was in use the supermarket managed to build a substantial - if rather wayward - portrait of this reluctant shopper's habits. A formal DPA request, followed by numerous letters to and fro, a terse telephone conversation and finally, a fax explaining that, yes, this information would be used in a journalistic exercise, finally produced two sides of information.

Apparently, I'm a gal who hankers after "finer foods"- indeed, a "natural chef", though friends tell me this probably has more to do with my tendency to cook with natural ingredients than any signs of being a budding Nigella. I am, Tesco determines, "upmarket" - a reference, I suspect, to my habit of buying organic food (Green & Blacks mint chocolate being a particular favourite).

The database defines me through the past four years, placing me in the mysterious "C10" category for 2003, having been an "H13" a year earlier - whatever that means. My "family type" is "other," though alternative social options are not listed. Most importantly for the supermarket, I just don't spend as much as I could there. Under "share of spend" with Tesco I am deemed to have "potential".

My household carries a "reference number", the date of my last visit, with branches used in the past. It says whether I have used Clubcard vouchers and correctly states I do not want my personal information to be passed to other parts of the "Tesco Group". There is no information as to whether I am diabetic, teetotal or have a special diet.

Five slots describe my "shopping habits", each carries the words "Not shopped in last eight weeks". Clearly, I'm a Tesco deserter and a prime candidate for those £10-off vouchers that have been dropping through the letter box of late.

· To learn how to get your personal information under the Data Protection Act, see www.guardian.co.uk/foi
http://www.guardian.co.uk/business/s...573821,00.html





Local news

Secrecy Power Sinks Patent Case
Kevin Poulsen

When New England inventor Philip French had his epiphany 15 years ago, he didn't dream it would lead to an invention that would be pressed into service in a top-secret government project, or spawn an epic court battle over the limits of executive power. He was just admiring a tennis ball.

The ball's seam, with its two symmetrical halves embracing each other in a graceful curve, intrigued him. "I thought, my god, I bet you can do something with that kind of shape," he recalls. He was right. French and two colleagues went on to design and patent a device now called the Crater Coupler, a simple, foolproof connector for linking one pipe or cable to another without nut threads or bolted flanges.

The device is interesting on its own, but the broader legal legacy of the invention may be more important. In a little-noticed opinion this month, a federal appeals court ruled against the Crater Coupler patent holders and upheld a sweeping interpretation of the controversial "state secrets privilege" -- an executive power handed down from the English throne under common law that lets the government effectively kill civil lawsuits deemed a threat to national security, even if the state is not a party to the suit.

The ruling is notable as a rare appellate interpretation of the state secrets privilege as it applies to patent holders. As such, it is a potentially worrying development for inventors -- particularly those developing weapons, surveillance and anti-terror technologies for government contractors -- who may find infringement claims dismissed without a hearing under the auspices of national security. It also offers a fascinating, if limited, view into the machinery of official secrecy at a time when the privilege is being exercised as never before.

"It's the most powerful privilege the government has," says William Weaver, senior adviser to the National Security Whistleblowers Coalition. "It's the nuclear option. It never fails."

French says he and his partners -- Charles Monty and Steven Van Keiren -- got the first inkling of a national security application for the Crater Coupler a decade ago. While shopping the new design around to "a whole mess of quick-disconnect companies," the trio received an intriguing inquiry from Lucent Technologies, the reincarnation of the legendary Bell Labs research center, and at that time still part of AT&T.

Lucent wanted to evaluate the Crater Coupler for use as a fiber-optic "wetmate" -- an airtight connector for two fiber-optic cables designed to operate underwater. It was part of a contract with a U.S. government agency that, the company said, would have to remain unnamed. "It was a secret black job, they couldn't divulge what it was for," says French. "Who it was for, the Navy or the CIA, or who knows, they never said."

A Lucent spokesman confirmed that the company had contact with French in 1995, but wouldn't discuss the details, citing government secrecy concerns.

But according to French, the inventors agreed to help Lucent try to adapt the Crater Coupler to the company's needs, with the expectation that Lucent would license the group's patent if it all worked out. The inventors sent over plans, sketches and a model, and French began consulting and advising a Lucent engineer in monthly phone calls.

After about a year of development and testing, Lucent had good news for the inventors: The device passed all the tests, shaming a competing, clunky design that French says resembled an old thermos. But when the inventors got on the phone with Lucent's lawyers to discuss license terms, the company dropped a bomb. "Almost the first thing they said was, 'Well, we don't have to do anything, because this is under some sort of provision for military secret stuff where we don't have to pay anything,'" says French.

French felt betrayed. "This was after a year of encouragement, with me helping them and them informing us of their progress," says French. "That was one hell of a shock."

Lucent eventually offered the inventors $100,000 for the right to produce 1,000 wetmate couplers. The offer caused a rift between French and his partners: They wanted to make a counteroffer of $500,000, but French -- in his 60s and recently retired -- wanted to take what was on the table. "I said, well, Lucent doesn't have to do a thing, so why don't we take $100,000 and be happy with that?"

Unable to agree, French's partners bought him out for a flat $30,000. "I used some of the money to have a garage built," French says.

Lucent rejected the remaining inventors' counteroffer, and in 1998 Monty and Van Keiren, now incorporated as Crater Corp., filed a federal lawsuit in eastern Missouri against Lucent alleging patent infringement, trade-secret theft and breach of contract. Crater's attorney, Robert Schultz, says there's a question of basic fairness. "Lucent's made a ton of dough, and my clients are out in the cold," says Schultz.

The patent-infringement portion of the case has since been dismissed, under a federal law that says a company can't be sued for infringement if the development was for the exclusive use of the government.

After a year of pretrial wrangling, the case had progressed to the point that Schultz could start subpoenaing documents to support his claim, when the government intervened to assert the state secrets privilege.

Never passed by Congress, the privilege has its roots in English common law and was cemented into American jurisprudence by a landmark 1953 Supreme Court case titled U.S. v. Reynolds. In Reynolds, the widows of three men who died in a mysterious Air Force crash sued the government, and U.S. officials tried to quash the lawsuit by claiming that they couldn't release any information about the accident without endangering national security. The Supreme Court upheld the claim, establishing a legal precedent that today allows the executive branch to block the release of information in any civil suit -- even if the government isn't the one being sued.

According to research by Weaver, an associate professor of political science at the University of Texas, the government invoked the privilege only four more times in the next 23 years. But following the Watergate scandal, the executive branch began applying state secrecy claims more liberally. Between 1977 and 2001, there were at least 51 civil lawsuits in which the government claimed the state secrets privilege -- in every case successfully.

"There was more oversight of presidential activity" after Watergate, says Weaver. "In response to that, I think presidents resorted to the state secrets privilege to keep that oversight from cramping their style."

Under Reynolds, the head of a federal agency must personally intervene to invoke the privilege. In Crater v. Lucent, it was Richard J. Danzig, then-secretary of the Navy, who did the honors. In a March 1999 declaration, Danzig claimed that permitting Crater to pursue a legal inquiry into the government's alleged use of their coupler would tip off U.S. adversaries to certain highly classified government operations and "could be expected to cause extremely grave damage to national security."

"Those operations and programs are currently ongoing," Danzig wrote. "It is therefore my opinion that disclosure of information concerning them would permit potential adversaries to adopt specific measures to defeat or otherwise impair the effectiveness of those operations and programs."

Judge E. Richard Webber granted the government's request immediately, and blocked the Crater inventors from obtaining any information from Lucent or the feds about the government's alleged use of the Crater Coupler or any other coupling device. In the legal battle that followed, it emerged that the order covered an astonishing 26,000 documents -- some of which were not only unclassified, but had already been entered into the public record. In 2002, Webber examined those documents in chambers, and concluded that not one of them would be available for Crater's use in pressing its case.

Schultz turned to the Federal Circuit Court of Appeals. This month a divided three-judge panel ruled (.pdf) that the lower court had properly applied the state secrets privilege. "I would have thought that courts would be more hesitant to apply it to the patent area, but in this case there was no hesitancy whatsoever," says Weaver.

In a dissenting opinion, Circuit Judge Pauline Newman wrote that the ruling efficiently killed Crater's lawsuit, and argued that a saner solution would have been to proceed with the case behind closed doors -- a procedure already used to protect classified information during criminal espionage prosecutions.

"Although there may be areas of such sensitivity that no judicial exposure can be countenanced -- such as, perhaps, the formation of the Manhattan Project -- there is no suggestion that the sensitive information concerning the Crater Coupler cannot be protected by well-established judicial procedures for preserving the security of sensitive information," Newman wrote.

Schultz argues that the secrecy order shouldn't apply to documents concerning an unclassified presentation that Lucent held in which it allegedly showed off the Crater Coupler. He plans to ask for a rehearing of the appeal but claims to be optimistic that the case can proceed with or without access to the evidence.

If so, it would be a rarity, says Steven Aftergood, director of the Federation of American Scientists' Project on Government Secrecy. "The privilege has worked very effectively for the government," says Aftergood. "In almost every case where they've invoked it, it leads to the termination of litigation."

Indeed, the list of cases in which the state secrets privilege has been invoked seems a pantheon of injustice. The privilege was upheld in 1982 to prevent former Vietnam War protestors from learning more about an illegal CIA and NSA electronic surveillance effort that targeted them during the 1970s. In 1991, it was used to stop a lawsuit by a banker who'd unwittingly been roped into an illegal CIA money-laundering operation, and who claimed the agency had ruined his career when he tried to get out.

In 1998, workers at the Nevada airbase known colloquially as Area 51 were blocked from learning what chemicals they'd been exposed to during illegal burning of toxic waste by base administrators.

In 2004, the Bush administration resorted to the privilege to silence former FBI translator Sibel Edmonds, who said she was fired from the bureau after reporting security breaches and misconduct in the agency's translation program. And in perhaps the most disturbing case, this year the Justice Department asserted the privilege to kill a lawsuit by Maher Arar, a Syrian-born Canadian citizen who, in 2002, was picked up by U.S. officials as a suspected terrorist while changing planes at JFK, and promptly shipped off to Syria for a year of imprisonment and torture.

"Here's a guy who was a victim of a crime, that is, kidnapping, who was sent by us to a foreign country to be tortured to get information for us," says Weaver. "That violates all kinds of laws and the Convention Against Torture and who knows what else."

Weaver says the state secrets privilege is a blunt instrument that too often utterly obliterates any further inquiry by the plaintiffs in a civil case. "I'm not saying it's always invoked for evil purposes -- it almost certainly is not. But we can't tell when it is, and that's the problem." He faults Jimmy Carter for being the first president to use the privilege with frequency, and George W. Bush for using it systematically. "This presidency is the first one in history to use the secrecy privilege in a programmatic, organized comprehensive policy," Weaver says. "It's the first secrecy presidency."

"It effectively shuts down the judicial process," says Aftergood. "It tells people that they cannot have their day in court because national security will not permit it, and that's a terrible message to send."

Justice Department spokeswoman Cynthia Magnuson says the department generally doesn't comment on how the state secrets privilege is applied. "The only thing I can say is it's applied if appropriate only," she says.

But if the outcome sometimes seems unjust, it's a necessary trade-off to preserve national security, says Washington attorney Shannen Coffin, a lawyer at Steptoe and Johnson and a former U.S. deputy assistant attorney general from 2002 to 2004.

"That is the balance the court has struck in certain circumstances," says Coffin. "A lawsuit that relates to monetary damages isn't nearly as important as protecting the security of the American people."

While at the Justice Department, Coffin was involved in several cases asserting the privilege. "I've been in meetings with cabinet officials that have invoked the privilege, and they don't take it lightly," Coffin says.

If there's been an increase in the exercise of the privilege, "It is simply a recognition that information is a weapon in the modern day and age," says Coffin. "And that is a serious concern for national security."

Coffin says bold action, like withholding 26,000 documents in the Crater case, is sometimes necessary to prevent a U.S. adversary from compiling bits and pieces of seemingly harmless, unclassified information into a state secret. That "mosaic theory" of national security is frequently cited in litigation surrounding the privilege, and Department of Justice attorney Lisa Olson raised the argument in the Crater case last year.

"The more information that is disclosed, the easier it becomes to disclose more, and soon the floodgates are opened and nothing is secret," Olson told Judge Webber.

A Navy spokeswoman declined to comment on the Crater case, but outside experts say it's easy enough to guess the nature of the top-secret project the government is protecting. "It's all but self-evident that it has to do with the clandestine monitoring of fiber-optics communications cables on the ocean floor," says Aftergood.

"They've been interested in it since the first fiber-optic cable was ever invented," says James Bamford, author of two books on the NSA. "It's clear that they have a major operation in terms of tapping into sea cables."

Fiber-optic cables were well on their way to supplanting less-secure communications technologies at the time that Lucent approached the Crater inventors, and it's been widely reported that the switch threatened to cut off the electronic spies at the NSA. "There's been this huge shift from using satellite communications, which is very easy to tap into, to using both terrestrial and transoceanic fiber-optic cables, and that's presented a major problem for NSA," says Bamford.

To counter that problem, and keep the electronic intelligence flowing, NSA has reportedly developed sophisticated techniques for wiretapping undersea cables, relying on specially equipped Navy submarines, the most advanced of which is the newly recommissioned USS Jimmy Carter, fresh from a $1 billion upgrade that reportedly includes state-of-the-art technology for tapping into undersea fiber-optic communications.

French, now 74 and living in Maine, is not a party to the case since his partners bought out his interest in the invention. But he still has bad feelings over the affair.

"If it had been war time, World War II, I'd have given it to them. But if they're hiding behind some friggin' law, basically to screw somebody...." says French, trailing off.

Lucent spokesman John Skalko says the court's secrecy order prevents him from addressing the inventors' claims in depth. "We deny any breach of contract or any misappropriation of trade secrets," says Skalko.

"You can't try this case in your publication, it's only to be tried in a court of law," Skalko adds -- a prospect that seems increasingly unlikely.
http://www.wired.com/news/technology...,68894,00.html





Study: Wi-Fi Services To Bring In The Bucks
Staff

Worldwide revenue from wireless network services will more than triple over the next four years, according to a report released Tuesday by In-Stat.

The market researcher says revenue will rise to $3.46 billion in 2009, up from the $969 million expected in 2005.

The growth is being fueled by an increasing number of hot spots, the researcher said, predicting that the number of hot-spot locations will double in the next four years from the present 100,000.

The pace of growth, however, will drop in the short term, In-Stat said, particularly in the beginning of 2006, as the market begins to mature.

Also, over time, the average price-per-connection figure will fall, because of declining pay-as-you-go pricing, increasing service subscriptions and the increased presence of free hot spots, In-Stat analyst Amy Cravens said in a statement.

According to In-Stat, the most growth in the sector will come from the cafe segment. The segment--which includes coffee shops, fast food and restaurants--will grow 2.5 times from 40,000 venues now to just less than 100,000 hot spots by 2009, In-Stat said.

"Much of the growth in the cafe/restaurant market will be characterized by branded deployments such as the Starbucks, McDonald's and Panera Bread hot-spot networks," Cravens said.

Significantly, just about a month ago, Intel, with the help of many others, such as IBM, Dell and Cisco, launched a program for rolling out municipalitywide wireless networks in 13 cities. The cities that join the initiative, dubbed Digital Communities, are meant to have a broadband wireless infrastructure that lets the public better connect with police and fire personnel, as well as with public-works employees.
http://news.com.com/Study+Wi-Fi+serv...3-5874906.html





Avidly Seeking Wireless Clues From Google
Steve Lohr

Google, with deep pockets and seemingly boundless ambition, keeps marching steadily beyond Internet searching into new markets like e-mail, advertising, book searches, a satellite map service, instant messaging and telephony. Where next?

The most intriguing recent guess, based on a few Google experiments, is free wireless Internet service. And there appear to be fascinating hints on several Web pages nestled in Google's site. They describe a new test service called Google Wi-Fi and indicate how to use its wireless desktop software, Google Secure Access.

On one page, the features and terms of the new service are described as answers to questions.

"Is there a fee for using Google Secure Access? No, Google Secure Access is free."

"Where can I go to download Google Secure Access? The program can currently be downloaded at certain Google Wi-Fi locations in the San Francisco Bay area."

Citing those Web pages, Reuters carried an article yesterday saying that Google was preparing to introduce its own wireless Internet service. Later in the day, Reuters distributed a revised version of the article saying that Google had begun a limited test of the wireless service.

Google started two wireless access points in Silicon Valley in July, a spokesman said yesterday, one at a pizzeria and the other at a gymnastics center. Recently, it also talked with San Francisco officials about setting up public wireless networks in the city, where it established a single access point in Union Square last spring with a partner, Feeva.

Any further plans, a national rollout perhaps? "We have nothing to announce now," the spokesman, Nathan Tyler, said.

The early efforts, Mr. Tyler said, are part of Google's public outreach program and in keeping with the corporate mission to "make the world's information available."

Google is always guarded about new offerings. Its "billionaires with a heart" image - fostered in language and culture by its young founders, Larry Page and Sergey Brin - only serves to make industry analysts and rivals think that some marketing strategy is to be teased out of even the most innocuous pronouncements.

Speculation that Google may be planning free wireless service around the country has been rising. Last month, an article in Business 2.0 said that for the last year, the company had "quietly been shopping for miles and miles of 'dark,' or unused, fiber optic cable across the country," presumably as a step toward building a wireless network.

Such a free wireless service could make business sense, according to John Battelle, author of "The Search," a new book about Google published by Portfolio Hardcover. "It would be another way for Google to sell targeted advertising and burnish its brand," Mr. Battelle said. "And it's very much in the tradition of Google's brand promise - great stuff free."

Having its own wireless service, some analysts said, could reduce the risk Google would face if a big Internet service provider, like AOL, which now generates a lot of Google traffic, fell into the hands of its rival Microsoft. AOL and Microsoft have held talks recently. "Google may want to have more control over its own destiny," said Jordan Rohan, an analyst with RBC Capital Markets.
http://www.nytimes.com/2005/09/21/te.../21google.html





Talking in the Dark
Clive Thompson

When was the last time you heard a "busy tone" on a telephone? Probably not for years. Our phone system is so robust, our mobile phones are so ubiquitous and voice mail and e-mail are such reliable backups that instant, unhindered access to friends, colleagues and relatives has come to seem a right and not a privilege. Indeed, if you include instant-messaging, blogs and cellphone text messages, you might think we're living in the golden age of communications.

Except when disaster hits. Two weeks ago, I tried calling a colleague down in New Orleans - and found myself listening to the annoying honk of a busy signal and the static of a dead phone line. Katrina had disrupted the city's communications grid, and residents and emergency responders were grappling with the chaos that ensued. For a week, just about the only people with communications were those government officials and reporters lucky enough to have two-way radios or satellite phones with adequately charged batteries. Everyone else staggered around in blind ignorance - which helped produce horrifying pandemonium. We saw a similar lesson in 9/11: When communications crumble, so does society.

Is there a way to prevent such breakdowns in the future? In fact, disaster-preparedness experts and high-tech inventors are already developing the idea of blanketing cities with what they call a "WiFi mesh." WiFi, of course, is the technology you may use at home or in a Starbucks to connect a laptop wirelessly to the Internet; a mesh is a vast, self-correcting network of WiFi antennas that could work together to provide crucial backup in a disaster.

To understand what makes WiFi useful in a catastrophe, consider some frailties of our regular phone-company communications. Phone systems are reliable on a day-to- day basis, but they have a key vulnerability: They're centralized. In any city, a handful of central "switches" handle the work of routing local phone calls. During 9/11, several important switches were located across the street from the World Trade Center and were damaged in the towers' collapse, blacking out parts of New York.

To make matters worse, phone systems are rarely designed to allow more than 10 percent of the population to talk simultaneously, and far more people than that rush to the telephone in an emergency. In the New York City blackout of 2003, while most land lines continued to function, the cellphone circuits were overjammed.

Katrina posed even worse problems. As phone traffic surged, the water was destroying a vast area, including underground phone lines. Mobile-phone networks, too, were ruined, because they're routed through communication towers that crumpled like paper in Katrina's 140-mile-an-hour winds. As a final insult, Katrina knocked out the power grid in swaths of the Gulf Coast - which was fatal for phone systems that require thousands of watts of juice. The surviving mobile-phone sites in New Orleans could run on diesel-generator backup, but with just one tank of gas each, they were capable of operating for only a few days. Even the mayor nearly lost contact with the outside world. After their satellite phones ran out of power, employees of the mayor's office broke into an Office Depot and lifted phones, routers and the store's own computer server.

WiFi meshes elegantly dodge our phone system's central problems. They're low-power and ultracheap - and decentralized like the Internet itself, which was initially conceived to withstand a nuclear attack. You can use WiFi to build a do-it-yourself phone system that is highly resistant to disaster.

In Chicago, the Center for Neighborhood Technology, a nonprofit organization, hooked up dozens of households in the neighborhoods of North Lawndale and Pilsen with WiFi nodes that form a mesh. Each node can communicate with its neighbor a few hundred feet away; by cooperating in this fashion, they form an enormous bucket brigade, each passing the data signal along until everyone is sharing it. If one single household connects to the Internet, all the other households can instantly dip in. Best of all, the WiFi mesh can handle not only data but also phone calls - via the magic of "voice over IP," an increasingly popular technique for transmitting conversation over the Internet. Should the local phone lines suddenly collapse, the residents of these neighborhoods can still make calls to one another using headsets attached to their computers. In essence, they are their own backup phone company.

Unlike a normal land-line or mobile phone system, a WiFi mesh has no single weak point. Knock out any single node in one of the Chicago neighborhoods - destroy an entire house, for that matter - and the mesh has enough redundancy to work around the missing link. The nodes are also durable; they're tiny shoe-box-size devices, which means they're far less likely to be wiped out by hurricanes than enormous mobile-phone-company antennas. "We've been running these little Apollo 13 disaster scenarios where a bunch of our nodes get taken out, and the whole system just reconfigures itself automatically," said Paul Smith, who helped build the Chicago networks.

So why don't cities build their own WiFi meshes to help cope with the next disaster? Scatter enough nodes on rooftops citywide, and then if the phone system collapses, there will probably be a surviving mesh strong enough to serve as a rudimentary backup. Connect even a single satellite uplink to the mesh, and the entire town remains linked to the outside world. Best of all, each WiFi node uses extremely little power - about 10 watts, barely a sixth of the average light bulb. Even if a city's power grid fails, a car battery or solar panel could keep a node running for days or weeks, filling the gap while the phone companies rebuild their land-line and mobile-phone structures.

These disaster experiments are already under way. When Katrina hit, Smith and other volunteer communications enthusiasts rushed down to Louisiana. In Rayville, his team of techies clambered up a local tower to blast WiFi signals 50 miles through the countryside; their signals reached refugees clustered in church basements with computers but no Internet connections. "We're trying to make sure families can contact each other, and get online to register with FEMA's Web site," Smith told me.

The cost is laughably small. City engineers could build a mesh using parts on sale at any Circuit City. (Smith's neighborhood mesh in Chicago cost $350 per node, and he figures it could take only $650 apiece to equip every node with an emergency battery.) Alternatively, a city could simply hire a mesh-networking company like Tropos Networks, which estimates a cost of $70,000 to cover a square mile with DSL-speed connections. These numbers are so low that they are virtually rounding errors in any city's budget.

WiFi does have its limitations. To begin with, an antenna can communicate with another antenna only if it has a clear line of sight. But because the system is so inexpensive, it wouldn't be difficult to address this problem by placing antennas closely together in congested areas. Of course, a WiFi mesh wouldn't work if its users had no supply of electricity. And emergency responders and the military will always need to rely on their own high-quality two-way radios and satellite phones. But for the rest of us, when disaster next strikes, WiFi meshes could be the clever system that keeps people in contact - from house to house.
http://www.nytimes.com/2005/09/18/magazine/18idea.html





Groups Call For Broadcast Flag Hearings
Anne Broache

The battle against the "broadcast flag," a controversial copy-protection technology designed to limit piracy of digital TV programs, is picking up again.

This time, non-profit groups Public Knowledge, Consumers Union and the Consumer Federation of America have dispatched a joint letter to the chairman of the U.S. Senate Commerce Committee, urging federal lawmakers to convene hearings on the matter.

Public Knowledge and other public interest organizations were behind the initial legal challenge against the broadcast flag. A federal court in May unanimously tossed out Federal Communications Commission regulations that would have prohibited the manufacture of computer and video hardware without certain copy-protection features.

The decision did, however, leave Congress the option of giving the FCC such regulatory power. Non-profit groups say they're now concerned that such a proposal could slip through as an amendment to one of the large spending bills lawmakers will likely pass this fall.

Congress needs to understand that "there are alternative techniques for protecting television content that do not require putting the FCC in control of the design of almost all digital products, everywhere, that might conceivably contain or transmit digital television," the Sept. 19 letter said.

"A full hearing of the issues surrounding Internet piracy of television...would show that content owners now have all the legal tools they need to pursue, punish, and deter infringers of television and other content," it went on.

At this point, the groups haven't encountered a draft bill or amendment that would revive the flag, but "we're reaching a point where people on the Hill are starting to focus on the issues, and we wanted to make certain this is part of the thought processes," Art Brodsky, communications director for Public Knowledge, said in an e-mail.
http://news.com.com/2061-10796_3-5873042.html





TiVo Users Fear Recording Restrictions
AP

Many fans of digital video recorders made by TiVo Inc. are beginning to fear that Hollywood studios will one day reach into their set-top boxes to
restrict the way they record and store movies and programs.

Among the functions included in TiVo's latest software upgrade is the ability to allow broadcasters to erase material recorded by TiVo's 3.6 million users after a certain date. That ability was demonstrated recently when some TiVo customers complained on TiVo community sites that episodes of ``The Simpsons'' and ``King of the Hill'' they recorded were ``red-flagged'' for deletion by the copyright holder.

Some users also were upset that they were prevented from transferring these red-flagged shows to a PC via the TiVoToGo service.

Elliot Sloan, a TiVo spokesman, called the red-flag incident a ``glitch'' and said it affected only a handful of customers. ``It's a non-story,'' Sloan said.

Nonetheless, skeptics among TiVo users questioned why TiVo would own such a technology unless the company planned to one day use it.

TiVo and other digital video recorders let users skip commercials and jump around a recording quickly. Since TiVo introduced its DVR in the late 1990s, customers have enjoyed the ability to record anything they want, and store it indefinitely.

But last year, TiVo quietly disclosed that it would employ copyright-protection software from Macrovision Corp. for pay-per-view and video-on-demand programs. According to a post on TiVo's Web site, the software allows broadcasters to restrict how long a DVR can save certain recordings or in some cases prevent someone from recording altogether.

``Program providers decide what programs will have Macrovision copy protection,'' said the TiVo post.

Matt Haughey, creator of PVRblog.com, the Web site where the complaints first appeared, said some fans are overreacting about the red-flag incident. However, he said he is worried that TiVo has handed Hollywood a means to restrict recordings.

``TiVo would be of limited utility in the future if the studios were allowed to do this with regular broadcast content,'' Haughey said. ``This is like cell-phone jammers. What if you couldn't talk on your cell phone? If customers can't do something with their TiVo that they could in the past, they will stop using it.''

TiVo is among many platforms that could be transformed by the entertainment industry's demands for tighter copyright controls.

Broadcasters have also tried to force electronics manufacturers to insert a technology known as the broadcast flag into new televisions to prevent programs from being copied or disseminated on the Internet.

The Federal Communications Commission at one point required such piracy preventions, but those rules were blocked in May by a three-judge panel for the U.S. Circuit Court of Appeals for the District of Columbia. Congress may get the last word.
http://www.siliconvalley.com/mld/sil...y/12705682.htm





Symantec: Mozilla Browsers More Vulnerable Than IE
Tom Espiner

Mozilla Web browsers are potentially more vulnerable to attack than Microsoft's Internet Explorer, according to a Symantec report.

But the report, released Monday, also found that hackers are still focusing their efforts on IE.

The open-source Mozilla Foundation browsers, such as the popular Firefox, have typically been seen as more secure than IE, which has suffered many security problems in the past. Mitchell Baker, president of the foundation, said earlier this year that its browsers were fundamentally more secure than IE. She also predicted that Mozilla Foundation browsers would not face as many problems as IE, even as their market share grows.

Symantec's Internet Security Threat Report Volume VIII contains data for the first six months of this year that may contradict this perception.

According to the report, 25 vendor-confirmed vulnerabilities were disclosed for the Mozilla browsers during the first half of 2005, "the most of any browser studied," the report's authors stated. Eighteen of these flaws were classified as high severity.

"During the same period, 13 vendor-confirmed vulnerabilities were disclosed for IE, eight of which were high severity," the report noted.

The average severity rating of the vulnerabilities associated with both IE and Mozilla browsers in this period was classified as "high", which Symantec defined as "resulting in a compromise of the entire system if exploited."

The Mozilla Foundation did not immediately respond to requests for comment.

Symantec reported that the gap between vulnerabilities being reported and exploit code being released has dropped to six days on average. However, it's not clear from the report how quickly Microsoft and Mozilla released patches for their respective vulnerabilities, or how many of the vulnerabilities were targeted by hackers, though Microsoft generally releases patches only on a monthly basis.

Symantec admitted that "at the time of writing, no widespread exploitation of any browser except Microsoft Internet Explorer has occurred," but added that it "expects this to change as alternative browsers become increasingly widely deployed."

There is one caveat: Symantec counts only those security flaws that have been confirmed by the vendor. According to security monitoring company Secunia, there are 19 security issues that Microsoft still has to deal with for Internet Explorer, while there are only three for Firefox.

The report also highlighted a trend away from the focus of security being on "servers, firewalls, and other systems with external exposure." Instead, "client-side systems--primarily end-user systems--(are) becoming increasingly prominent targets of malicious activity."

Web browser vulnerabilities are becoming a preferred entry point into systems, the report stated. It also highlighted the trend of hackers operating for financial gain rather than recognition, increased potential exposure of confidential information, and a "dramatic increase in malicious code variants".
http://news.com.com/Symantec+Mozilla...3-5873273.html





Opera Nixes Banner Ads In Free Version
Martin LaMonica

The latest free version of Opera Software's namesake browser will be available without an advertising banner.

With version 8.5 of the Opera browser, which was released Tuesday, the company said that it has removed banner ads from its free edition. Until now, Opera customers had the option of paying to eliminate the ads and receive premium support.

With the licensing change, Opera hopes to accelerate uptake of its browser, the company said.
"Removing the ad banner and licensing fee will encourage many new users to discover the speed, security and unmatched usability of the Opera browser," Jon von Tetzchner, CEO of Opera Software, said in a statement.

Premium support via e-mail is still available from the company for $29 per year.

Version 8.5 also addresses some security vulnerabilities and includes a feature called Browser JavaScript, which automatically fixes out-of-date browser scripts.
http://news.com.com/Opera+nixes+bann...3-5874093.html
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