Peer-To-Peer News - The Week In Review - September 3rd, ’05

[JackSpratts]

"It's safe to say that buying shitloads of lame new music from major labels online will become as popular as P2P sharing." – Annalee Newitz


"The Whack-A-Mole game continues. The authorities go after one [P2P] system and another one pops up." – Andrew Parker


"Google, an enormously successful company, claims a sweeping right to appropriate the property of others for its own commercial use, unless it is told, case by case and instance by instance, not to. In our view this contradicts both law and common sense." – Association of American University Presses


"This program will help users discover more books, publishers sell more books and authors to ultimately write more books." – Adam Smith, Google


"Print publishing has had a great 500-year run, but the print book is morphing into the screen book. The big publishing houses just don't get it." – Warren Adler


"The main thing is, give readers a new book for free, and they might go back and buy some of the former books." – Warren Adler


"The probation department realizes this is small potatoes." – William Bispels






























September 3rd, 2005




Flooding Stops Presses and Broadcasts, So Journalists Turn to the Web
Steve Lohr and Felicia R. Lee

With their offices and presses flooded, news media outlets in New Orleans mostly abandoned newsprint and television broadcasts yesterday and set up shop on the Web.

The Times-Picayune, whose daily circulation is 270,000, put out only an electronic edition yesterday with a one-word headline summing up the impact of Hurricane Katrina: "Catastrophic."

A morning update on the Web site said The Times-Picayune was evacuating its building in New Orleans and that staff members were heading for Houma, a bayou town about 60 miles to the west. The newspaper's office phones and its e-mail system went dead.

Only one of the four local television stations, WWL Channel 4, a CBS affiliate, has been able to stay on the air throughout the last few days. Channel 4, owned by the Belo Corporation, used a tower and transmitter at the company's new facility in Gretna, La., and also sent journalists to the communications center at Louisiana State University in Baton Rouge, more than 75 miles away.

Two other stations, WNOL Channel 38, a WB affiliate, and WGNO Channel 26, an ABC affiliate, went off the air and relied on their Web sites, which featured weather updates, video footage and advice for coping with the disaster.

"What we've done in the interim is use the Web sites of both stations to get news to viewers and employees," said Gary Weitman, a spokesman for Tribune Broadcasting, which owns the stations.

WDSU Channel 6, an NBC affiliate, moved its operations to two sister stations, one in Jackson, Miss., and another in Orlando, Fla. With some interruptions, it got back on the air and presented news and weather programming on its Web site as well. "The Web played a big role in all of this," said Tom Campo, a spokesman for Hearst-Argyle, the station's owner.

The Internet, as a decentralized communications network, can be more resilient than traditional media when natural disasters occur. "Owning broadcast towers and printing presses were useless," said Jeff Jarvis, a consultant to online media companies. "The Web proved to be a better media in a case like this."

Yesterday, phone calls to the New Orleans region met with only busy signals, and the occasional communications from New Orleans to other parts of the country tended to be sent from the private e-mail accounts of editors and reporters.

In the afternoon, a message from Peter Kovacs, a Times-Picayune managing editor, reached the paper's bureau in Washington, with a brevity of a wartime cable message. "Still in Houma. Phones don't work well," Mr. Kovacs wrote. "Leaving for Baton Rouge to set up shop. Shea staying behind to set up a copy desk," a reference to Dan Shea, the paper's other managing editor.

Despite the scramble to find a new base of operations, The Times-Picayune was able to add a few staff-written stories to its Web site during the day as well as updates from The Associated Press. The Times-Picayune is part of the Newhouse chain of newspapers, owned by Advance Publications. The paper's Web site, www.nola.com, is run from computers in a data center in New Jersey, said Mr. Jarvis, the former president of Advance.net, which oversees the Web sites of the Newhouse papers.

Steven Newhouse, the chairman of Advance.net, said he had mostly been watching The Times-Picayune's struggle to keep reporting the news from a distance since he lost e-mail and phone contact with the editors.

"So we've been out of touch, but they've had this amazing publishing thing on the Web and the Web log and they've done it under these terrible conditions," Mr. Newhouse said. "It's a credit to everyone's ingenuity and their willingness to figure it out on the fly."

Web logs, or blogs, have become magnets for advice, opinion and personal observations sent in by individuals to media Web sites and on personal blogs - as they typically do in response to major news events.

On "Kaye's Hurricane Katrina Blog," Kaye Trammell, an assistant professor of mass communication at L.S.U., cautioned readers, for example, that cellphone use was still limited in the New Orleans region. "So if you're trying to call a loved one that might have been impacted by the storm," she wrote, "please keep in mind that not getting through on a cellphone is not an indication of their safety."

Others were more personal. John Strain, a social worker in Covington, La., described the hurricane's assault on Monday. "The wind is really picking up now and I hear the roof above me wobble," he wrote in his online journal. "The sound is like a waterfall or rushing river."

Katharine Q. Seelye contributed reporting for this article.
http://www.nytimes.com/2005/08/31/na...l/31media.html





Filesharing Traffic Leads Internet
Jason Meserve

eDonkey is the new BitTorrent

A new study that looks at the impact of peer-to-peer (P2P) traffic on service provider networks shows that file swapping forges on unabated.

CacheLogic, a Cambridge monitoring firm, says the practice shows no sign of slowing down, despite court rulings that have shut down some popular sites, such as Suprnova, a BitTorrent tracking service that offered links to pilfered television and movie content.

CacheLogic's global monitoring network shows that 60 per cent of all internet traffic is the result of P2P file-sharing platforms, with eDonkey taking over the top spot from BitTorrent.

"The Whack-A-Mole game continues," says Andrew Parker, CacheLogic's CTO. "The authorities go after one [P2P] system and another one pops up."

At the end of 2004, BitTorrent accounted for 30 per cent of internet traffic. But after the Motion Picture Association of America's moves to shut down BitTorrent tracking sites - centralised servers for locating distributed content - swappers began moving to other less-publicised services.

Today, eDonkey, a system that uses no centralised servers or tracking sites, consumes the most bandwidth of any application on the internet, according to Parker. And in the US, Gnutella has seen resurgence in popularity among swappers.

Of the files being swapped on the four major file-sharing systems (eDonkey, BitTorrent, FastTrack and Gnutella), 62 per cent are video and 11 per cent are audio, with the rest made up of miscellaneous file types, according to the study.

The problem for ISPs is that the traffic is symmetric, meaning the same amount of traffic going downstream (where the pipe is bigger) is coming back up, choking the smaller upstream broadband pipes. And traffic is constant, unlike email and web surfing, which tails off during the night.

In addition to releasing internet traffic details, CacheLogic has announcing that it is looking to expand its monitoring network by offering free equipment to selected service providers. CacheLogic and the ISP would share the traffic analysis data.

P2P filesharing does have some legitimate uses, as it pushes the distribution load away from a central origin server and out to the very edge: each individual user/viewer.

The BBC has launched iMP, a download service that relies on P2P technology to deliver television programming to subscribers. Each program could be multi-gigabyte; this would be nearly impossible to serve to all BBC subscribers from a central location, Parker says.
http://www.pcadvisor.co.uk/index.cfm...view&news=5010





MPAA Anti-Piracy Lawsuits Target Individuals
Bary Alyssa Johnson

The MPAA announced today that, as part of its large-scale anti-piracy campaign, it has begun to take aggressive action against individuals who illegally download and trade movies through the Internet.

The Motion Picture Association of America says it has filed hundreds of lawsuits against people who have obtained or distributed copyrighted material through P2P (peer-to-peer) file-sharing Web sites. It's highly likely that more suits will follow, according to an MPAA representative.

"The MPAA has developed a multi-pronged approach to combat piracy, and we are working to deliver our movies to consumers in new and innovative ways," said Gayle Osterberg, a spokesperson for the MPAA.

"However, when it comes to consumers stealing our product, we also have a very aggressive enforcement aspect to our anti-piracy program. In cases where people are illegally downloading films, there is a great likelihood that they risk being sued at some point down the line."

The MPAA recently shut down over 30 Web sites, after suing the server operators for facilitating illegal file sharing. Many of these sites used Bittorrent technology to allow for faster distribution or transfer of large files, according to an MPAA representative.

MPAA officials acquired the ISP addresses of individuals who were using those file-sharing services to download copyrighted content from the Web site operators, according to a recent news release.

"We are filing suit in the districts where the ISPs are operating from and are working with local organizations to get actual names of users, whom we will contact in an attempt to settle," said Osterberg.

"If they choose to ignore those overtures or refuse to settle with us, we will then move forward with lawsuits against specific individuals."

The MPAA has filed more than 250 individual lawsuits on behalf of the major Hollywood movie studios, as part of its multifaceted approach to fighting piracy, according to the news release.

"Certainly, illegal file sharing is an increasing concern for our industry," said Osterberg. "We estimate for hard goods piracy alone last year, the industry lost about $3.5 billion. Smith Barney carried out a private study to factor in online piracy, and they estimate losses to be in the $5.5 billion range this year."

To combat these losses, the MPAA campaign aims to educate individuals about the consequences of illegal downloading and to use innovative technology to make it easier to acquire movies legally. Additionally the MPAA is taking a proactive stance with worldwide law enforcement officials to crack down on Internet piracy operations, according to the news release.

"Internet movie thieves be warned: You have no friends in the online community when you are engaging in copyright theft," said senior vice president and Worldwide Anti-Piracy Director John G. Malcolm in a company statement.

"The fact that people who engage in illegal activity through torrent sites have now been identified and sued should come as no surprise. People who think they are acting anonymously when engaging in movie theft online are just fooling themselves and will face the consequences of their actions."
http://www.pcmag.com/article2/0,1895,1853573,00.asp





Movie Studios Poised for Piracy Fight
Jon Newton

Universal Pictures has already started touting its US$150 million re-hash of "King Kong," due out around Christmas. But how will the mighty ape be kept safe from the Evil File Sharing Villains?

High-speed Internet connections can mean huge, extremely fast downloads and, as a result, movie studios are now faced with the "same thorny challenges that the music industry encountered several years ago with the emergence of file-sharing programs," says the New York Times.

Interviewed by J.D. Lasica, ex-MPAA (Motion Picture Association of America) boss Jack Valenti said, "I visited the labs at Caltech, and they're running an experiment called FAST where they can bring down a DVD-quality movie in 5 seconds. The director told me it could be operative in the market in 18 months. Well, my face blanched."

Valenti also said, "Some new business model may want to put a movie out on the Internet just after it leaves theatrical exhibition. We can't afford to let that be copied at that juncture because it's the [home entertainment] aftermarket where you make your profits."

Behind the Times?

FAST or not, Hollywood is sticking to old, and badly outmoded, physical marketing, sales and distribution models. Instead of looking to P2P and other 21st century technologies to get them moving in the digital era, the major studios and their compatriots in the music industry are behaving like King Canute who tried, and failed, to hold back the tide. And it's these same physical DVDs which allow counterfeiters to not only live long, but also to prosper.

File sharers don't come into it. Despite many examples of creative accounting and imaginative reports, neither the labels nor the studios have ever able to solidly convince anyone that a shared file equals even a single lost sale.

On the other hand, the billions of physical CDs and DVDs flooding retail outlets around the world are so easy to copy, it's ridiculous. Counterfeiters and duplicators snap them up and hours later, faithful copies, often complete with look-alike packaging, are being peddled on street corners and in flea-markets. DRM? Forget it. The only people "copyright protection" impresses are the mainstream media.

There's no denying counterfeits and fakes must put a dent in Holywood's potential bottom line but, "Hollywood reported global revenue of $84 billion in 2004, according to PricewaterhouseCoopers, the accounting firm," says the NYT. "With most theatrical releases amounting to little more than an unprofitable, expensive form of marketing, DVDs have become Hollywood's lifeblood: together with videos, they kick in $55.6 billion, or about two-thirds of that annual haul, with box-office receipts making up most of the rest."

Never Enough Cash

Nonetheless, the entertainment cartels continue to claim they and their millionaire stars and well-paid support networks are suffering terrible financial and personal hardships because of file sharing, which they try to link with "piracy," as they've dubbed the practice of copying and re-selling their product.

Interestingly, Sony (NYSE: SNE) , a prime mover in both the studio and music worlds and one of the most vociferous complainants, also develops, makes and markets a significant proportion of the mini recorders it says are used by "cammers" to copy movies in the cinemas, as well as burners and associated supplies and equipment.

And speaking of Sony, it traced a "pirated" copy of "Something's Gotta Give" to a screener from actor Carmine Caridi, a member of the Academy of Motion Picture Arts and Sciences. "The Last Samurai" and other pirated screeners were also tracked back to Caridi. Russell Sprague, who ended up dead in an L.A. jail cell, received 130 movies from Caridi, who was ordered to pay Warner Bros. a paltry $300,000 for providing them.

Placing Blame

A now-famous AT&T Labs report, "Analysis of Security Vulnerabilities in the Movie Production and Distribution Process," revealed that of a total of 285 movies sampled on P2P networks, 77 percent were leaked by industry insiders.

Last year Mel Gibson's "The Passion of the Christ" was one of the most popular movies on the P2P networks. Gibson sued a Hollywood post-production company claiming bad security allowed three employees to copy the movie, which eventually turned up online and on the black market.

Much more recently, the Star Wars movie, "Revenge of the Sith," suddenly appeared online the same day it opened in theaters. But that wasn't down to would-be file sharers equipped with Sony's latest "pirate" camcorders. Rather, it was another, and very deliberate, Hollywood insider leak.

P2pnet publishes a unique weekly Movies File Share Top Ten based on BigChampagne stats and our TT chart for August 25 has "War of the Worlds" still in the global No.1 spot, with "Wedding Crashers" as the top U.S. movie.

But this doesn't mean millions of people are downloading and viewing these movies instead of paying for cinema tickets. In 2004, a record number of people visited cinemas in Western Europe in 2004, with admissions reaching 896.6 million, an increase of nearly 50 million on 2003.

And global revenue of $84 billion -- in one year
http://www.technewsworld.com/story/45777.html





Deals Pending For Students Accused Of Computer-Tinkering
AP

Most of the 13 students accused of tinkering with their school-issued laptop computers to download programs and spy on administrators are being offered deals in which the felony charges would be dropped, lawyers and a family member say.

In return, the students would perform 15 hours of community service, write an apology, take a class on personal responsibility and serve a few months probation, the attorneys said.

''The probation department realizes this is small potatoes,'' said William Bispels, an attorney representing nearly half the accused students.

School district officials and prosecutors did not return phone messages Thursday.

The 13 were charged as juveniles with computer trespass and computer theft, both felonies, and could have faced a wide range of sanctions, including juvenile detention.

The Kutztown Area School District said it reported the students to police only after detentions, suspensions and other punishments failed to deter them from breaking school rules governing computer usage.

But the students, their families and other supporters said authorities overreacted, punishing the students not for bad but because they outsmarted the district's technology workers.

The school had issued some 600 Apple iBook laptops to every student last fall. Kutztown is about 15 miles west of Allentown.

The charges allege the students breached security and downloaded forbidden programs, such as the iChat instant messenger. Some students also turned off a remote monitoring function that let administrators see what students were viewing on their screens -- and used it to view administrators' own computer screens.

Bispels said a few students are thinking about refusing the deal because they don't feel they have broken any laws.

But Mike Boland, who represents one student, said his client will likely accept the offer. ''It doesn't require my client to acknowledge he is guilty of anything,'' he said.

''It's about as mild as you can go,'' agreed James Shrawder, whose 15-year-old nephew was among those offered the deal. ''It's more of a face-saving measure.''

One student who has had prior dealings with the juvenile probation office was not offered a deal and the case was expected to proceed.
http://www.siliconvalley.com/mld/sil...y/12486229.htm





L.A. Cracks Internet Warez Ring
Roy Mark

In the first criminal Internet file-sharing case brought in California, a 34-year-old former Los Angeles resident pleaded guilty over the weekend to single felony count of grand theft.

Jed Frederick Kobles faces up to three years in prison for running an Internet file-sharing hub for trading movies, TV shows, music and games. Kobles, who now lives in Las Vegas, pleaded guilty on the same day the felony charge was issued. He remains free on his own recognizance until his Oct. 20 sentencing.

According to the criminal complaint, Kobles and still unnamed co- conspirators made films, music videos and television shows available for sharing during a four-day period in January.

Films available for illegal downloading included "Terminator 3: Rise of the Machines," "National Treasure" and "A Beautiful Mind." The videos were all by Madonna while the sole television show as an episode of "The Simpsons."

According to the Los Angeles County High Tech Crimes Unit, an undercover investigator joined Kobles' hub and downloaded more than 14 movies, television shows and music videos in January.

The undercover investigation led to a search warrant being served on Kolbes s residence in Los Angeles on Feb. 25. L.A. Assistant District Attorney Jeff McGrath said Kobles was in caught in the act of downloading the Xbox game Leisure Suit Larry when the warrant was served.

In the overt acts listed in the complaint, L.A. officials claim Kobles, under the screen name Raging8, operated a hub called UTB Smokinghouse. To join the group, users had to have access to a large amount of material they were willing to share with other members of the hub.

Commonly known as "warez" groups, the networks operate as the original sources for the majority of pirated works distributed and downloaded on the Internet. The stolen works frequently eventually filter down to peer-to-peer (P2P) networks and other public file-sharing networks.

In addition to filtering down to P2P networks, warez groups often are the primary source for the for-profit criminal distribution networks of DVDs and CDs since the digital files can be easily converted to optical disks.

Because of advancements in the use of sophisticated electronics and the Internet by warez groups, McGrath said, "These are difficult cases that require a great deal of expertise to investigate and prosecute."
http://www.internetnews.com/xSP/article.php/3531106





Local news

Connecticut Man Pleads Guilty To Selling Microsoft Source Code
AP

A Meriden man has pleaded guilty in federal court to charges related to the theft of the source code to Microsoft's Windows software.

William Genovese Junior is known on the Internet as "illwill." He pleaded guilty in New York City today to an indictment charging him with unlawful sale and attempted sale of the source code for Windows Two-Thousand and Windows N-T Four-Point-Oh.

Prosecutors say the software was obtained previously by other people and unlawfully distributed over the Internet.

The indictment against the 28-year-old Genovese was filed in February of last year. It alleges that he posted a message on his Web site offering the source code for sale, on the same day Microsoft learned significant portions of the code were stolen.

Access to a software program's source code can allow someone to replicate the program. Industry experts expressed concern that hackers reviewing the Microsoft software code could discover new ways to attack computers running some versions of Windows.

Genovese faces up to ten years in prison and a $250,000 fine when he is sentenced in the fall.
http://www.wtnh.com/Global/story.asp...1&nav=3YeXdtby





Surveillance

F.B.I., Using Patriot Act, Demands Library's Records
Eric Lichtblau

Using its expanded power under the antiterrorism law known as the USA Patriot Act, the F.B.I. is demanding library records from a Connecticut institution as part of an intelligence investigation, the American Civil Liberties Union said Thursday.

The demand is the first confirmed instance in which the Federal Bureau of Investigation has used the law in this way, federal officials and the A.C.L.U. said. The government's power to demand access to library borrowing records and other material showing reading habits has been the single most divisive issue in the debate over whether Congress should extend key elements of the act after this year.

Because of federal secrecy requirements, the A.C.L.U. said it was barred from disclosing the identity of the institution or other main details of the bureau's demand, but court papers indicate that the target is a library in the Bridgeport area.

The A.C.L.U., a leading critic of the Bush administration over the Patriot Act and its antiterrorism policies, brought a lawsuit on Aug. 9 in Federal District Court in Bridgeport on behalf of the Connecticut institution. The suit was filed under seal, and names and other information were redacted in a public version it released Thursday.

The A.C.L.U. said it would seek an emergency order allowing it to discuss details of the case publicly. A hearing has been set for Wednesday in federal court in Bridgeport.

In the debate over the future of the antiterrorism law, the administration has said that it has never used the so-called library provision in the law, which falls under Section 215, to demand records from libraries or booksellers.

The A.C.L.U. said that in the Connecticut case, the bureau was using a separate investigative tool, a type of administrative subpoena known as a national security letter, to get records related to library patrons, reading materials and patrons' use of the Internet.

The bureau's power to use national security letters to demand records without a judge's approval was expanded under the antiterrorism law. Last year, a federal judge in Manhattan struck down part of the subpoena provision as unconstitutional, in part because it allowed for no judicial oversight, but the Justice Department is appealing the ruling.

Anthony D. Romero, executive director of the A.C.L.U., said the demand for the Connecticut library records "shows that our supposed hysteria over the Patriot Act wasn't so hysterical after all."

"This is a prime example of the government using its Patriot Act powers without any judicial oversight to get sensitive information on law-abiding Americans," Mr. Romero said.

Officials at the Justice Department and the F.B.I. refused comment on the issue because it involves pending litigation. But one government official, speaking on condition of anonymity because of the litigation, cautioned against reading too much into the bureau's demand for the records in Connecticut.

Because the law prevents public disclosure concerning such demands for records, the official said: "Not all the facts have come out here. But national security letters are a legitimate investigative tool, and to draw conclusions without knowing what the underlying facts are, people have to be careful about that."

The letter from the F.B.I., which was included in the lawsuit, said the material being sought was needed as part of an investigation "to protect against internal terrorism or clandestine intelligence activities." The letter warned that the recipient was prohibited "from disclosing to any person that the F.B.I. has sought or obtained access to information or records under these provisions."

The lawsuit said the Connecticut organization, which is a member of the American Library Association, "strictly guards the confidentiality and privacy of its library and Internet records, and believes it should not be forced to disclose such records without a showing of compelling need and approval by a judge."

While the antiterrorism law is still awaiting final reauthorization by Congress, both the Senate and the House moved last month to extend at least temporarily the government's power to demand library records in terrorism investigations.

Administration officials have repeatedly emphasized that they have no interest in investigating the reading habits of law-abiding Americans.

But the administration has faced strong criticism from groups like the American Library Association, which released a survey of its members in June showing that law enforcement officials had contacted libraries at least 200 times since 2001 with formal and informal inquiries about their internal records.
http://www.nytimes.com/2005/08/26/po...26patriot.html





Opposition To Google Library Project Intensifies
Antone Gonsalves

Google Inc.'s book-copying library project has come under fire by two more publishers' groups, with one raising the possibility of legal action.

The Association of Learned and Professional Society Publishers and the Association of American University Presses have joined the Association of American Publishers in denouncing Google's copying of books without first seeking permission from the copyright holder.

Google, based in Mountain View, Calif., said this month that it would suspend until November scanning copyrighted books into its database, unless it has prior permission from the publisher or other copyright holder. At the end of the suspension, Google will resume copying books, unless it receives from publishers a list of specific titles they do not want in the search engine's database.

Google, however, has failed to satisfy the concerns of publishers. Google believes it's legal to copy the books, but publishers disagree. Their opposition comes in spite of Google's contention that its is copying the books to eventually provide in search results links to retailers where the material can be purchased.

"We firmly believe that, in cases where the works digitized are still in copyright, the law does not permit making a complete digital copy for such purposes," Sally Morris, chief executive of the ALPSP, based in England, said in a statement released this month.

The organizations also object to having the burden placed on them to opt out of the Google project.

"Google, an enormously successful company, claims a sweeping right to appropriate the property of others for its own commercial use, unless it is told, case by case and instance by instance, not to," the AAUP board said in a statement. "In our view this contradicts both law and common sense."

The ALPSP was the first of the three groups to indicate publicly that it was ready to go to court.

"We call on Google to hold an urgent meeting with representatives of all major publishing organizations, in order to work out an acceptable pragmatic way forward and to avoid legal action," Morris said.

Google was not immediately available Monday for comment. But the company has said that copying library books, part of its mission to digitize as much of the world's information as possible and make instantly available to people, benefits everyone.

"This program will help users discover more books, publishers sell more books and authors to ultimately write more books," Adam Smith, product manager for Google Print, said this month in an interview with TechWeb.

Smith also said Google believe its actions are "allowed under fair use and is consistent with all the principles underlying copyright law itself." Book publishers, however, argue that fair use under the law only applies to using portions of books for educational or non-commercial activities.

Google announced its library project in December, starting with collections in Harvard, Stanford, the University of Michigan, the University of Oxford and The New York Public Library. Besides expanding its network of search advertising, the project could someday put Google into direct competition with giant Internet retailer Amazon.com, experts say.

Book publishers are not the only ones rankled over Google's handling of copyrighted material. Adult magazine publisher Perfect 10 Inc. is asking a federal court in Los Angeles to prevent Google from displaying pictures and links to the company's copyrighted photos.

Perfect 10, whose namesake magazine competes with other soft porn publications, such as Playboy, sued Google in November 2004 in U.S. District Court for showing thumbnails of its photos in search results. The company also objects to Google linking to Web sites showing Perfect 10's photos without permission.

The Beverly Hills, Calif., magazine publisher has asked the court to hear its request for a preliminary injunction Nov. 7.
http://www.techweb.com/wire/ebiz/170101412





Steal This Book. Or at Least Download It Free.
Claudia H. Deutsch

TALK to Warren Adler, and watch some favorite clichés crumble.

Remember "The War of the Roses," the novel - and later, the movie - about a brutal divorce? Mr. Adler wrote the book and the screenplay, even though he has been married (happily, he says) to the same woman for 54 years. So much for "don't write what you don't know."

How about "don't fix what ain't broke"? Mr. Adler has published 27 novels. But did he follow the tried-and-true conventional print route for "Death of a Washington Madame," his 28th? No. He's self-publishing that one electronically, and e-mailing it free, a chapter at a time, to anyone who asks. Fogies (like this reporter) who still want the feel of pages "can always print the chapter out," he said. "The main thing is, give readers a new book for free, and they might go back and buy some of the former books."

The way Mr. Adler, 77 (there goes "you can't teach an old dog new tricks"), sees it, portable electronic readers will soon do to paper books what the Walkman and iPod did to boomboxes.

"Print publishing has had a great 500-year run, but the print book is morphing into the screen book," he said during a recent lunch at Pigalle, a French restaurant in Manhattan's theater district.

But what does that mean for those many, many people who believe there is a novel inside them, clamoring to be let out? Making a living as a writer has never been easy - even Mr. Adler was a self-described "failed writer" until, at 45, he finally caught a publisher's attention. So will all this technological upheaval make it easier or harder to get read?

Both, Mr. Adler insists. The Internet, with its limitless capacity for blogs and whole books that can be electronically whisked from place to place, means people can pretty well publish what they want. On the downside, the competition for readers, already intense, will become maddeningly so. But writers need not make it past the gatekeepers at publishing houses to be published. Vanity publishing - a term Mr. Adler hates - has come into the electronic age.

Nothing can guarantee a sale, but, Mr. Adler said, for as little as $295 - plus a fee for each book sold - self-publishing services will register a copyright and put a book into an electronic format that can be sold as an e-book or printed out. Up the price to $1,000 or so, and the services will send out news releases, contact reviewers and offer the book to stores and online vendors like Amazon.com.

"The big publishing houses just don't get it," Mr. Adler said. Apparently, Mr. Adler does: next month, he will begin selling all his past novels on flash memory cards, readable on e-book players.

It took Mr. Adler a long, long time before his "obsession with the need to tell stories" gave him the luxury of choosing formats. He started writing when he was 16, waking at 4 a.m. and writing until 7. He made his living first as a journalist, then as an ad man - but those three hours were always sacrosanct. He married at 22 and still, at 4 a.m., to the typewriter he went.

There was no money in it at first - but Mr. Adler was no stranger to making do with little. As a child growing up in Brooklyn, he lived with his parents, his two brothers and assorted relatives in his grandparents' house. At one point, 11 people shared a bathroom, "but it seemed a glorious childhood," he said.

He was a so-so student - "I read voraciously but I hated studying" - but still made it through New York University, majoring in English. He took a job as a copy boy at The Daily News, "because it was the closest I could get to the printed word." One day, on a Long Island beach, he struck up a conversation with Sonia Kline. They married in May 1951 and have three sons.

After a stint in the Army and a briefer stint in public relations, Mr. Adler started his own ad agency. By then, he had written three novels. Publishers were monumentally uninterested - until 1973, when he struck a deal with Whitman Publishing: he publicized John David Garcia's "The Moral Society" free, and Whitman published "Options," Mr. Adler's third book.

"Options" bombed - but he was finally a published author. That made it easier to get G. P. Putnam's Sons to publish "Banquet Before Dawn" in 1974. The advance was just $4,000, "but it felt like I'd won the lottery," Mr. Adler said. "It was the defining moment of my life."

Putnam published six more of his novels. Then it was bought by Universal Pictures, and "they dumped me," Mr. Adler said. Warner Books picked him up and published "War of the Roses."

He has learned from the many business mistakes he made along the way. In the 70's he sold the movie rights to "Trans-Siberian Express" for $250,000; the movie was never made, but he could not get the rights back. When he sold movie rights to "Private Lies" several years later, he made sure the rights reverted to him after 10 years.

Still, the writing life has been good to him. He lived in Hollywood, working on movie scripts. And he lived in Washington for years, hobnobbing with politicos. For the last 15 years, the Adlers have lived in Jackson Hole, Wyo., most of the time, and on Manhattan's Sutton Place some of the time.

All the while, of course, he has kept writing. So, not surprisingly, he has lots of tips for would-be writers in the electronic age. Some - "force yourself to write each day," "approach your work seriously" - are pretty hoary. But many have modern-day spins, and many, while basic, are counterintuitive. Here are a few tidbits, including some for people who want to publish an old-fashioned, printed book:

Take a writing course, and draft your professor as a quasi publisher. It is pretty easy for writing professors to set up links on university Web sites to electronic versions of novels they find promising. "They might even get reviewers to periodically weigh in," he said. No money would change hands, "but before you make money you have to get read," he said.

Think of yourself as a writing machine, with an on/off switch. If you decide to write from 5 a.m. to 7 a.m., be at that keyboard on the dot - and get up from it on the dot. "You sit there through writer's block, and you stop even if the ideas are flowing," Mr. Adler said. Start and end each session by rereading the last few pages. You'll make sure the facts are consistent - a character's blue eyes on page 12 are not green on page 48 - and it will get your subconscious working on the next plot point.

Send a one-page synopsis to an agent who specializes in your genre. Check out Literary Marketplace, which tells you who deals with mysteries and who likes gothic romances. If you are unsure of the genre - is it sci-fi or fantasy? - IUniverse and a few other companies will help determine it, and even lightly edit the book.

If you find a print publisher, negotiate like an entrepreneur. Standard contracts give publishers electronic, foreign and movie rights. But if you have a halfway decent voice, try to negotiate the right to record your own books. And don't automatically give the publisher options on a second book. "It may feel like an easier way to stay in the publishing pipeline, but if that first book does well, you can negotiate a better contract on the second," he said.

Be creative about generating buzz. "Your friends can hold book parties as easily as Tupperware parties," Mr. Adler said. He suggests pasting your name and book title on the side of a rented Winnebago and driving through town. If the book is about, say, older people, then visit a senior citizen center to talk it up. If you can't afford a full-time publicist, hire one for a few hours to book you on a few radio shows. And start a blog in which you talk about yourself, your experiences, anything at all. "Like chicken soup, it can't hurt," Mr. Adler said.

Don't think you are a lousy writer because publishers reject you. As Mr. Adler put it, "In the end, as in all things, luck trumps talent."
http://www.nytimes.com/2005/08/21/bu...y/21lunch.html





Hollywood, Microsoft Align On New Windows
John Borland

As Microsoft readies the next version of its Windows operating system, called Vista, the software giant is building in unprecedented levels of safeguards against video piracy.

For the first time, the Windows operating system will wall off some audio and video processes almost completely from users and outside programmers, in hopes of making them harder for hackers to reach. The company is establishing digital security checks that could even shut off a computer's connections to some monitors or televisions if antipiracy procedures that stop high-quality video copying aren't in place.

In short, the company is bending over backward--and investing considerable technological resources--to make sure Hollywood studios are happy with the next version of Windows, which is expected to ship on new PCs by late 2006. Microsoft believes it has to make nice with the entertainment industry if the PC is going to form the center of new digital home networks, which could allow such new features as streaming high-definition movies around the home.

PCs won't be the only ones with reinforced pirate-proofing. Other new consumer electronics devices will have to play by a similar set of rules in order to play back the studios' most valuable content, Microsoft executives say. Indeed, assuring studios that content will have extremely strong protection is the only way any device will be able to support the studios' planned high-definition content, the software company says.

"The table is already set," said Marcus Matthias, product manager for Microsoft's digital media division. "We can come in and eat at the buffet, or we can stand outside and wash cars."

Hollywood studios didn't get all the protections they wanted in Vista, and record labels have even seen some of their key concerns about copy- protecting CDs left unaddressed. But the Vista operating system as a whole goes much further than any general-purpose computing platform before it toward addressing content companies' piracy fears.

Although ordinary MP3 files and DVDs will play without any difference, the deep changes in the way the operating system handles some entertainment content will come with costs. The most obvious of these may be the risk of compatibility problems between some older monitors or TVs and Vista computers, particularly when trying to play high-quality video. Vista may also make it harder to do some casual copying, such as recording Internet audio.

"This is definitely being driven by Microsoft's desire to position Windows as a home entertainment hub, and to do that they have to make some concessions," said Matt Rosoff, an analyst with research firm Directions on Microsoft. "They're walking a line, trying to please both sides (content companies and consumers) at the same time."

These changes are worrisome to some computer programmers and digital activist groups. They fear that increasingly high security levels will block off avenues of programming innovation, or even stop computer owners from accessing portions of their own machines--a little like walling off a room inside a private house.

"There is a concern that there is a tendency to lock down parts of the design to protect the flanks of the copy-protection system," said Princeton University computer science professor Edward Felten, who has been an outspoken critic of rigid copy-protection rules. "That makes it harder for everyone, including Microsoft, to adapt to new uses."

Putting video behind a wall
Several major changes have been made to the way the operating system will handle video and audio, though few of these are included in the early version now in the hands of beta testers. The rest of the components will likely be added in the next, as yet unscheduled, beta release, and will be in the final launch of the operating system next year.

At the most basic level, some audio and video--at least when it is in Microsoft's Windows Media format--will be handled in a new "protected environment" that will keep applications such as media players or plug-ins separate from the actual media data.

Essentially, this means that much of the actual heavy lifting of decoding, unlocking and playing the audio will happen in what some engineers refer to as a separate "sandbox." Media player applications will send remote control commands such as play, fast-forward or stop into this protected space, without directly handling the data as they do today.

Technology called the "Protected Video Path" will then attempt to ensure that a video stream is encrypted--and thus difficult to copy--all the way until it reaches a monitor or other device where it is being displayed.

This won't always be possible, because most analog plugs, and some digital connections, don't support this kind of copy protection. Part of Vista's job will be to check to see what kind of devices are linked to the computer, and through what kind of connection, and decide whether the content can be encrypted or otherwise protected over that link.

If the answer is "no," in the case of high-resolution Video Graphics Array (VGA) connections, or some early Digital Video Interface connections, the computer could shut down output of video altogether through those plugs, if the content owners require that.

Alternately, Vista will include a "constriction" feature that can decrease the resolution of high-definition video on the fly, outputting a version that is slightly fuzzier (about the same as today's DVDs) than the pristine original. This can be used as an alternative to blocking a connection altogether, if a content company won't let high-definition video play over the lower-security outputs.

This feature won't affect most HD televisions, which typically are already shipped with secure connection technologies. PC monitors have been slower to adopt tools such as Intel's HDCP (High-Bandwidth Digital Content Protection) that support secure connections, however.

Most of these advanced copy-protection features in Vista are designed to apply to high-definition content and are unlikely to change the way today's DVDs or broadcast-quality content is played, Microsoft says.

Labels lack copy-protected CD support
A similar process will happen for copy-protected audio files, potentially encrypting the audio until it leaves the computer, and offering the ability to turn off specific outputs if content owners deem them insecure.

For the last year, record labels have sought additional features in the operating system that would make playing copy-protected CDs a more streamlined experience. But so far, Microsoft has not added any features specifically supporting these new CDs, saying that the technology isn't yet mature, and that other companies--Apple Computer and other music software companies included--also need to be involved.

"We're seeing digital distribution move at a rapid enough pace that the rules for which people access content today across the music services are very consistent," said John Paddleford, lead program manager for the Microsoft team that works directly with content companies. "This is what we're driving the labels to reach on the CD itself, so there's a consistent consumer experience. I think it is going to take time for the labels and the application vendors--not just Microsoft--to find a middle ground."

A spokesman for the Recording Industry Association of America, which has engaged in discussions with Microsoft on this issue, declined to comment.

Sensitive subject
Microsoft is aware that the high level of protection--which could result in some monitors and TVs not playing high-definition content at full resolution-- could spark criticism and confusion.

The company is quick to say that this has not been a case of studios dictating policy to programmers.

"The studios are very good about not trying to design software," Paddleford said. "I've never had a studio say, 'We need an API (application programming interface) that does this.' But they do talk about, 'Well, we want to make sure that our theatrical content doesn't get played in any place but a theater.'"

For their part, studio executives say they haven't been involved in the intimate details, but are happy to see what Microsoft has done.

"The greatest problem in existing operating systems is that content is in the clear across certain interfaces," said Chris Cookson, chief technology officer for Warner Bros. "They've undertaken to improve that, which everyone was glad to see."
http://news.com.com/Hollywood%2C+Mic...3-5844393.html





Why DRM Will Have a Negative Affect in the Long-Run
Alexander Grundner

I was just bouncing around some ideas about DRM (Digital Rights management) and its impact on consumers. I've read various reports on the topic (most long-winded and vague), but I was never satisfied with their findings. So here's how I see it...

Points/Categories:

Category 1: Average consumers buy what's made available to them and they don't pirate music and videos (this represents the majority of the population).
Category 2: Above average consumers, with knowledge of how various peer-to-peer (P2P) technologies and DRM stripping techniques work, will find ways to circumvent DRM on media they own or will download illegal copies of the same works and others of interest (this is a small portion of the population).
Category 3: Blatant pirates, people who make it their life's work to crack DRM and distribute pristine illegal copies of media through various online channels, are virtually impossible to stop (these are the one percent-ers).

Conclusion:
No matter how many barriers media companies place on protecting their media from duplication or piracy, an unlocked version will always be available to those who seek it. (FYI, although it's available, it doesn't mean it's practical to get – i.e. multi-gig High-Definition video). Moreover, if media companies restrict duplication and interoperability to the point where fair-use is not an option, you'll see more consumers jumping into Category 2. So, in reality, media companies are pushing consumers to engage in "illegal activities" by offering an inferior product (be it physical or software based) instead of courting them with a new, and even more empowering feature-set.

Aside:
In order to understand what consumers want, you have to look at what they currently have – in particular CDs and DVDs.

· CD/DVD: extremely high-quality digital media that you physically own
· CD: ability to transcode the audio into different codecs and bitrates
· CD: unlimited duplication capabilities
· CD/DVD: playable on any CD/DVD drive (interoperability factor)
· CD/DVD: share media with friends and family by either burning a copy or letting someone borrow a CD or DVD

The truth is once you strip DeCSS encryption from a DVD, you have the exact same features a CD allows you to have.
http://www.ehomeupgrade.com/entry/1310/why_drm_will





Apple, Digital Music's Angel, Earns Record Industry's Scorn
Jeff Leeds

Two and a half years after the music business lined up behind the chief executive of Apple, Steven P. Jobs, and hailed him and his iTunes music service for breathing life into music sales, the industry's allegiance to Mr. Jobs has eroded sharply.

Mr. Jobs is now girding for a showdown with at least two of the four major record companies over the price of songs on the iTunes service.

If he loses, the one-price model that iTunes has adopted - 99 cents to download any song - could be replaced with a more complex structure that prices songs by popularity. A hot new single, for example, could sell for $1.49, while a golden oldie could go for substantially less than 99 cents.

Music executives who support Mr. Jobs say the higher prices could backfire, sending iTunes' customers in search of songs on free, unauthorized file-swapping networks.

Signs of conflict over pricing issues are increasingly apparent. This month, Apple started its iTunes service in Japan without songs from the two major companies - Sony BMG Music Entertainment and Warner Music Group - leaving artists like Avril Lavigne, Beyoncé and Rob Thomas out of the catalog because the companies refused to license their music to iTunes, executives involved in the talks said.

That gap in the Japanese music market, the world's second biggest, is considered a harbinger of what may await American consumers as the contracts that record companies have with Apple in the United States come up for renewal early next year.

Mr. Jobs in the past has cast himself as an innovator battling established media giants like Disney and Microsoft. But these days, allies and adversaries both agree, he has more power online than Wal-Mart has in the bricks-and-mortar world.

Apple commands an estimated 75 percent of digital music sales, and roughly 80 percent of sales of MP3 players, with its market-leading iPod. While many still admire Mr. Jobs's touch - iTunes quickly established a market for paid downloads after the industry wasted years on misfires - he also inspires enmity or jealousy from others in the industry, which is back in a slump after a modest rebound last year.

Mr. Jobs' vision of simple, uniform pricing for songs and a policy of limiting Apple's music to Apple's devices are increasingly under attack.

"He'd like to continue to define the rules of the game," said Paul Vidich, a special adviser to America Online and former executive vice president of the Warner Music Group. Mr. Vidich said the digital music market, while growing, was still a fraction of the music business, but added, "I just think the music companies are now at a point where there's too much money on the table not to insist" that Apple accept variable prices.

"The question is," Mr. Vidich said, "what do they want the profile of the business to look like going forward?"

A sore point for some music executives is the fact that Apple generates much more money selling iPod players than it does as a digital music retailer, leading to complaints that Mr. Jobs is profiting more from tracks downloaded to fill the 21 million iPods sold so far than are the labels that produced the recordings.

Andrew Lack, the chief executive of Sony BMG, discussed the state of the overall digital market at a media and technology conference three months ago and said that Mr. Jobs "has got two revenue streams: one from our music and one from the sale of his iPods."

"I've got one revenue stream," Mr. Lack said, joking that it would require a medical professional to locate. "It's not pretty."

In a more conciliatory statement yesterday, Mr. Lack said: "I look forward to sitting down with Steve in the fall when we are scheduled to discuss Apple and Sony BMG's relations going forward. I think Steve has done a great job on behalf of the industry and in the months ahead we have lots of challenges to conquer together."

Apple has long allowed different prices for full albums sold on the service, though it believes that maintaining the 99-cent price for each song on an album acts as a natural cap. The service, which is available to consumers who download iTunes software to their computers, allows users to choose from roughly 1.5 million songs from major and independent labels. The songs, once paid for and downloaded, can be transferred to an iPod device, burned to blank discs, or played on the computer. At the price of 99 cents a song, the share of the major labels is about 70 cents.

Some analysts suggest that the willingness of the music companies to gamble on a new pricing structure reflects a short memory.

"As I recall, three years ago these guys were wandering around with their hands out looking for someone to save them," said Mike McGuire, an analyst at Gartner G2. "It'd be rather silly to try to destabilize him because iTunes is one of the few bright spots in the industry right now. He's got something that's working."

The push for variable pricing is not uniform across the business. The Universal Music Group, a unit of Vivendi Universal and the industry's biggest company, appears to support Mr. Jobs's desire to maintain the price of 99 cents a track for the time being. The EMI Group, the British music giant, has expressed a desire for more variation in prices but does not appear interested in a protracted fight.

The divide among the four record companies reflects a broader philosophical argument about whether the fast-expanding digital market is stable enough to bear a mix of prices, particularly a higher top end, while millions of consumers still trade music free on unauthorized file-swapping networks.

"I don't think it's time yet," said Jimmy Iovine, the chairman of Interscope Records, Universal's biggest division. "We need to convert a lot more people to the habit of buying music online. I don't think a way to convert more people is to raise the price.

"I believe that he really feels that everybody isn't hooked yet into the whole concept," Mr. Iovine said, referring to Mr. Jobs. "You make it affordable, at a reasonable price, so they can learn about it. It's not an unreasonable position."

The other main battleground in Apple's coming confrontation with the industry has to do with "interoperability" of services and devices. Mr. Jobs has so far refused to make the iTunes software compatible with music players from other manufacturers, and he has prevented the iPod from accepting music sold from competing services that use a Microsoft-designed music format. As a result, songs purchased from Napster, for example, will not play on an iPod.

Apple's critics say the strategy echoes the company's decision, in the early years of personal computers, not to license its Mac operating system software. Many computer industry analysts say that approach allowed the rival Windows system to establish itself, and consigned Apple to a far smaller share of the computer market.

Apple has said that it will benefit more from improving iTunes than from devoting resources to make it compatible with other, smaller systems.

Still, to some executives, that practice makes Mr. Jobs appear more concerned with maintaining market dominance for his high-margin iPods than with allowing a more open digital market. All of the music companies, to one degree or another, have been urging Mr. Jobs to abandon the strategy, according to executives involved in the talks.

Hilary Rosen, the former chairwoman of the Recording Industry Association of America, agrees on that point. "If Apple opened up their standards, they would sell more, not less," she said. "If they open it up to having more flexibility with the iPod, I think they'd sell more iPods. On the other hand, I don't think it's their fault that nobody else has come up with something great" to compete.

Sony BMG in particular has taken steps that may apply pressure to Mr. Jobs to make Apple's software compatible with that of other companies. The company has issued dozens of new titles - including high-profile CD's from the Dave Matthews Band and the Foo Fighters - with software to limit the number of copies that can be made from the disc.

The software is compatible with Microsoft's music software, but not Apple's, and as a result music from those Sony BMG albums cannot be transferred to iPods that are hooked up to Windows-based PC's. EMI has been test-marketing similar software with a handful of titles.

Even some music executives who favor altering the iTunes service doubt that they will be able to force Mr. Jobs' hand by withholding their music. Instead, they are counting the months until the major wireless phone carriers enter the business of selling songs to mobile phone customers. Since there are many more mobile phones in use than there are iPods, the industry thinking goes, the arrival of a broad mobile music market will erode the leverage Mr. Jobs now holds.

But Apple has also been working with Motorola to develop a phone that can import songs from an iTunes-equipped computer.

Mr. McGuire said Apple was not likely to quietly surrender its position in the market.

"I think if they're throwing down for a street fight," he said, "they may have picked somebody who's as good or better at it than they are."
http://www.nytimes.com/2005/08/27/te...rtner=homepage





Royalty Fight Clouds Music Subscriptions
By John Borland

Digital-music companies and music publishers have reached an impasse in royalty negotiations, clouding the future of online subscription services such as those from Yahoo, RealNetworks and Napster.

The two sides have been negotiating on and off for years over the amount of money that songwriters and music publishers should get from these subscription plans, which allow listeners to download or stream an unlimited amount of music per month.

The services have long since struck agreements with record labels, and download stores such as Apple Computer's iTunes have their royalties settled. Subscription services have been operating under a temporary agreement with the publishers since 2001, however.

"The problem is that it's been four years, and we have not had one penny distributed to songwriters or publishers," said David Israelite, chief executive officer of the National Music Publishers' Association. "The digital subscription market has been inhibited by the lack of certainty."

The latest round of negotiations between the NMPA and the Digital Media Association (DiMA), which represents large companies including Yahoo, RealNetworks and Apple, has largely broken down over price.

Music publishers and songwriters, led by the NMPA, have proposed a new kind of license for subscription services that would lump together several different types of fees paid by radio stations and download services.

This "unilicense" is necessary because subscription services use both streams and downloads, the publishers contend.

In return, the group has asked that nearly 17 percent of subscription services' gross revenues go to songwriters and publishers. That's far above what publishers and songwriters typically get for a music sale, which usually is around 5.25 percent for online radio or 8.5 percent for digital downloads.

The services say that figure is far too high, and have suggested 6.9 percent instead. Both sides have now stopped negotiating and are trading angry letters instead.

"These companies are passionately committed to paying all copyright owners fair value for their creative work, and simultaneously creating successful businesses that defeat the scourge of pirate networks," DiMA Executive Director Jon Potter wrote in a letter to the publishers groups on Friday. "This careful and expensive balancing act requires enormous investment in creative content, product development, marketing and customer service, but it cannot justify--for any executive regardless of title--paying double and triple royalties in comparison to historical industry economics."
http://news.com.com/Royalty+fight+cl...3-5843822.html





Web, DVDs Could Mark CDs' Slow Death
Yuki Noguchi

When Ohio-based rock band the Sun releases its first full-length album next month, it will be available on DVD, online and on vinyl record. But not on the medium that's still the biggest seller in the music industry today: the compact disc.

"It's a tip of the hat to the past and the tip of the hat to the future," said Perry Watts-Russell, a senior vice president at Warner Bros. Records Inc., which signed the band.

The label expects the Sun to be the first of many artists to embrace a no-CD, video-only strategy. And that is part of a larger move away from the traditional album concept that some experts say is steering the CD the way of the hand-cranked gramophone.

The full-length CD format, which debuted in 1981, last year sold 766.9 million copies, down from a high of 942.5 million in 2000, according to statistics from the Recording Industry Association of America. At the same time, online sales -- championed by the popular Apple Computer Inc. iTunes Web site -- is picking up part of the slack: 139.4 million tracks were sold online in 2004.

The digitization of music has created a shift in how tunes are shared and consumed. Because it's faster to copy and transmit digital music, more people are copying and sharing tracks -- prompting copyright concerns from the entertainment industry. On the other hand, the cheapness of Internet distribution allows many no-names to release music that otherwise might never be seen or heard outside a garage.

The Sun's 14-song album, "Blame It on the Youth," will be released Sept. 27 and will come with one disc option -- a DVD of music videos that can be manipulated through a computer to download the songs onto an MP3 player or burn them onto a CD. Actually, there is a second disc, but it's made of vinyl -- a nod to a burgeoning subculture that is reviving the old long-play format.

Having a new generation of listeners who may be building libraries of songs by piggy-backing off their friends' collections doesn't bother Sam Brown, drummer and songwriter for the Sun, which had a $50,000 budget to produce the videos for the album. "As more people find out about our band, more people will turn out when we play," he said. And for smaller acts like his, live performance is where the money is.

Members of the Sun, which is a garage pop band with a slightly retro aura and a sound one critic called "slick and gritty," knew that its demographic reflected its own persona: younger, digital and alternative.

"I haven't bought a new CD in a very long time," Brown said. Instead, he searches for vinyl versions, or rips songs to his iPod, or gets music from friends, he said.

The five-member band produced its own videos, and the record label was sold on the digital-video-only option, he said. "It is sort of a leap of faith to the future," Brown said, but "it feels good to be in the company of forward-thinking people."

Watts-Russell of Warner Bros. acknowledges that all-video and all-Internet distribution changes the definition of the word "album" -- a sequenced body of songs with heavy emphasis on the all-important cover art.

"I think the gestalt of having an album has been changing on its own, with or without this change," he said. "A few years from now, this is going to be exceedingly common," Watts-Russell said. "You can avoid the CD. It's on its way out. It's in no way out now, but the writing is on the wall."
http://www.washingtonpost.com/wp-dyn...082501999.html





Pixar Shares Dip on Report of SEC Inquiry
AP

Shares of Pixar Animation Studios Inc. fell nearly 2.5 percent Friday after a published report said the Securities and Exchange Commission Inc. has requested information leading up to the filmmaker's report earlier this month of lower second-quarter earnings.

The company issued a statement at midday confirming that it had received "an informal request for information from the SEC, as companies do from time to time, and we believe we have fully complied with that request."

But the one-sentence statement did not address what the SEC wanted or when the request was made, and spokesman Nils Erdmann declined to elaborate. "We have no other comments," he said.

Pixar shares fell $1.01 to close at $41.99 Friday on the Nasdaq Stock Market, where its shares have traded in a 52-week range of $36.56 to $54.47.

The Wall Street Journal reported Friday that the SEC launched an informal inquiry into Pixar after heavier- than-expected returns of "The Incredibles" DVD led the studio to miss its second-quarter earnings forecast.

The story, citing unidentified people familiar with the case, said Pixar is cooperating with the SEC.

On Aug. 4, Emeryville, Calif.-based Pixar reported it earned $12.7 million, or 10 cents per share, in the second quarter compared to $37.4 million, or 32 cents per share, a year earlier. Revenue fell to $26.4 million from $66.3 million.

In June, Pixar lowered its earnings estimates for the second quarter after finding that home video sales of "The Incredibles" were weaker than expected.

Upon reviewing sales data, the studio decided to increase its cash reserves in anticipation that it might have to refund retailers for unsold copies of the movie.

The company said at the time that the move would result in lowering net income in the quarter by 5 cents per share, or $6 million.
http://hosted.ap.org/dynamic/stories...CTION=BUSINESS

[JackSpratts]

Two Arrested in U.S. Computer Worm Probe
Mark Sherman

Authorities in Morocco and Turkey have arrested two people believed responsible for a computer worm that infected networks at U.S. companies and government agencies earlier this month.

Farid Essebar, 18, was arrested in Morocco, while Atilla Ekici, 21, was arrested in Turkey on Thursday, Louis M. Riegel, the FBI's assistant director for cyber crimes, said Friday. They will be prosecuted in those countries, Riegel said.

Essebar wrote the code that attacked computers that run Microsoft Corp. operating systems and Ekici paid him for it, Riegel said. It's unclear they ever met, "but they certainly knew each other via the Internet," he said.

Riegel said he does not know how much money changed hands. Microsoft and FBI officials also declined to estimate the monetary damage done by the Zotob worm and its variations.

The pair also is believed responsible for an earlier worm, Mytob, that first showed up in February, Riegel said.

The Zotob worm and its variations targeted computers that run Microsoft Corp. operating systems, with Windows 2000 users most seriously affected.

The worm disrupted computer operations in mid- August at several large news organizations, including The Associated Press, ABC, CNN, and The New York Times; such companies as heavy- equipment maker Caterpillar Inc.; and the federal Immigration and Customs Enforcement bureau.

Microsoft played a large role in locating the suspects, said Riegel and Microsoft general counsel Brad Smith.

The worm emerged just a week after the software giant had warned of a security flaw and released a "critical" patch for it, which is most severe on Windows 2000 systems. Those computers can be accessed remotely through the operating system's "Plug and Play" hardware detection feature.

Protective patches, plus instructions for cleansing infected systems, are available on the company's Web site.

Zotob and its variations can attack a computer without needing to open any software, so some users would be infected without knowing it.

Experts said the damage probably wouldn't be substantial because most companies made the necessary software fixes quickly.

Windows 2000 also is more than five years old, and Microsoft has released several new versions of its operating system and security overhauls since then, further limiting the exposure.
http://hosted.ap.org/dynamic/stories...CTION=BUSINESS





Legal Minds Duke It Out Over P2P at EMX Conference
Humphrey Cheung

At the Entertainment Media Expo in Hollywood, the two opposing sides of the peer to peer debate squared off in dueling keynote speeches. Up first was Stanford Law School Professor Lawrence Lessig who argued that big media companies are using the law to stifle creativity. George Borkowski, former acting director of Litigation for the Recording Industry Association of America (RIAA), had a different viewpoint, saying that the P2P networks are for pure piracy.

Each side had twenty minutes to state their case, and Lessig and Borkowski were surprisingly civil to each other. Both are no strangers to the courtroom, as Lessig has testified in and defended many intellectual property cases, most notably Eldred vs. Ashcroft in 2003. Borkowski represented the major record labels in 2000 against Napster.

Lessig said that there is no concrete term for copyright violations and that users of new technologies are often called "pirates" by businesses that can't adapt. "With the piano player, radio, cable TV and in the Sony Betamax case, copyright holders always have battled pirates. But the pirates have always won," says Lessig.

According to Lessig, the first copyright fight may have been song writers against the piano players. Rather than change their business model, the writers took legal action against players and demanded royalties. Today, we are seeing the same battle between record companies and the peer to peer networks such as Bittorrent and EDonkey.

"We need to dial back the obsessive control of the media companies," stated Lessig.

In his rebuttal, Borkowski talked about his battle against the P2P services and doesn't buy the argument that P2P networks have reasonable intentions, for example a distribution of legal videos or Linux ISOs. "There is copying [of songs/movies] 90 percent of the time. This is outright massive copying," Borkowski said.

Borkowski admitted that rights holders do sometimes go overboard: For example, he mentioned a case between Universal Music against Mattel in a 1997 lawsuit over the song "Barbie Girl". Mattel argued that their Barbie doll line was being misused by the band Aqua in their parody song and "this was a case where rights holders took an extreme position," says Borkowski. The music labels won that case because the Courts ruled that the song was a parody that fell under Fair Use laws.

But according to Borkowski, the P2P networks don't provide parody or additional content. "This is out and out copying, with no cool snippets added."

Even though the RIAA has lost several cases against P2P networks, the latest win against Grokster makes Borkowski happy: "Finally, the court brought things back into a balance."
http://www.tomshardware.com/hardnews...31_154250.html





FCC Delays Cutoff of Internet Phone Users
Jennifer C. Kerr

A deadline has been extended that could have left tens of thousands of people without their Internet phone service next week.

The Federal Communications Commission said Friday it would delay a Monday deadline for providers of Internet-based phone calls to obtain acknowledgments that their customers understand the problems they may encounter when dialing 911 in an emergency.

Providers of the phone service, known as Voice over Internet Protocol or "VoIP," had been told by the FCC that they should disconnect service by Tuesday to people who had not responded.

The agency extended the deadline to Sept. 28. If by that time a provider still has not received confirmation, then the company should disconnect a customer's phone service, according to the FCC order.

The agency gave companies the option of turning off regular Internet phone service to a client but still allowing emergency calls to 911 to be made. As part of this so-called "soft" disconnect, a provider could also allow customers to place non-911 calls that would automatically be sent to the company's customer service center.

The VON Coalition, a group of VoIP providers, was pleased with the extension but still worried about having to cut a client's service next month.

"You've got to think there's some portion of the population that's not going to return these things," said Glenn Richards, legal counsel for the coalition. "I just question whether the best result is to turn those people off."

The deadline extension followed complaints from the coalition, which includes AT&T and MCI, that customers would be left stranded in an emergency. Rep. Bart Gordon, D- Tenn., Sen. Bill Nelson, D-Fla., and other lawmakers also wrote FCC Chairman Kevin Martin to express their concerns.

Anywhere from 75,000 to 100,000 people could have been left with no service, according to industry estimates. There are about 1.7 million VoIP subscribers nationwide.

The FCC issued its initial order in May after tearful testimony from a Florida mother who told the commissioners about how she was unable to summon help to save her dying infant daughter.

The commission ordered the companies to provide full emergency 911 capabilities by Nov. 28. The acknowledgments were a first step in that process.

Unlike traditional telephones, where phone numbers are associated with a specific location, VoIP users can place a call from virtually anywhere they have access to a high-speed Internet connection. That can make it difficult to connect VoIP accounts to the computer systems that automatically route 911 calls to the nearest emergency dispatcher and transmit the caller's location and phone number to the operator who answers the call.

Power outages can also be a problem, leaving users unable to dial 911 because the high-speed Internet modems, phone adapters and computers needed for VoIP rely on electrical outlets.

Vonage Holdings Corp., the biggest VoIP carrier, with more than 800,000 subscribers, said Friday that 97 percent of its customer base had responded to the company's notices about 911 risks. That leaves 23,000 subscribers the company is still trying to reach via e-mail, phone and mail.
http://hosted.ap.org/dynamic/stories...CTION=BUSINESS





TiVo Tests Internet Download Service
Greg Sandoval

Add TiVo Inc. to the list of companies trying to wed the Internet to television. The digital recording company will soon allow customers to download TV shows to their set-top boxes via the Internet - even before the shows air on TV.

TiVo has struck a deal with the Independent Film Channel to transmit several of the cable channel's shows through a broadband connection as part of a trial program. Participating customers will begin receiving the shows next week, said TiVo spokesman Elliot Sloane.

Sloan confirmed that TiVo sent messages to its customers - later posted on the technology Web log Engadget.com - offering to transmit three IFC shows beginning Aug. 19, before they aired on the cable channel.

Content on demand has long been a holy grail for Internet and cable companies as they hunt for the next generation of television. No one yet has found a way to overcome the considerable technological hurdles, such as finding a speedy way to pump two- hour movies through broadband, or convince Hollywood that its content won't be pirated and that it can profit from Internet broadcasts.

Still, Internet connections are picking up speed and moving closer to a reliable delivery method for broadcast-quality video. Should the day come that video is downloaded at the touch of a button, some stakeholders foresee a vast video universe of endless variety.

TiVo has offered its 3.3 million customers a form of watch-what-they-want, when-they-want-it luxury since it launched in 1997, but the service remains restricted to broadcast schedules, and customers must program their set-top box to record shows.

Right now, fans of the spy drama "Alias" must wait until weekly episodes are broadcast on ABC. Conceivably, an Internet broadcaster could strike a deal with a studio to offer customers a season's worth of shows at once.

The question is, why would any studio with a hot show want to hand over its content to TiVo?

After all, TiVo's service cuts networks out of advertising revenue by making it easy for viewers to skip past commercials. And then there is the question of money, says Rob Sanderson, media analyst with American Technology Research.

"The cable and satellite companies pay an awful lot of money for content," said Sanderson. He cites ESPN as an example - ESPN receives about $2.20 per month for each cable and satellite subscriber. ESPN reaches 80 million homes so that equals about $160 million a month, "more than TiVo will do in two years," Sanderson said.

"The studios would ask themselves 'Who are we disenfranchising by working with these TiVo folks in terms of distribution partners? TiVo would need a lot of scale, a massive audience. They would have to offer enormous financial incentive. They have neither right now."

The challenges have been illustrated by other companies trying to offer video downloads to computers.

Akimbo Systems Inc., for example, takes as long to download shows as to watch them, and its users must pay $199 for a set-top box and then connect to the Internet through a high-speed connection.

In comparison, Comcast Corp. offers video-on-demand at no additional charge to digital customers and requires no additional equipment beyond the digital cable box. The shows are delivered over the normal existing coaxial cable to transmit the shows over Comcast's own network.

Besides movies, Comcast offers shows from PBS, HBO, NFL Network, MTV and elsewhere. This is the kind of content muscle cable channels can flex.

News of TiVo's test was revealed a day after the company saw its stock fall more than 6 percent following a media report that DirecTV was planning to stop marketing the service to its 14 million customers. News Corp.-owned DirecTV is planning to throw support behind a competing digital recording company. About 70 percent of TiVo's customers have come from its deal with DirecTV.

TiVo shares fell 8 cents to close at $5.54 in trading Friday on the Nasdaq Stock Market.

Struggling to boost the number of its customers and facing the loss of one of its top partners, TiVo is scrambling to find new ways to appeal to the public as well as monetize its service. The company has yet to make a profit.

In recent months, the company, which built its reputation by helping users skip commercials, has begun experimenting with new ways to sell advertising.

What TiVo has going for it is a rich history of ramping up complex new systems, said Sanderson.

"Their good at bringing innovative creations to market," said Sanderson. "I just don't see this one helping in the near term."
http://hosted.ap.org/dynamic/stories...08-16-08-17-37





At TiVo, a Risk of Being Skipped Over
Laura Rich

Since its first digital video recorder made its debut in 1999, TiVo has grown into a pop culture fixture and even worked its way into the lexicon (“to TiVo” is to record a television program). But as it turns out, that’s not enough to achieve market domination in any practical sense. TiVo’s 50 percent share of the current digital video recorder user base is still only three million households, and the company has posted losses throughout its entire eight-year history. But it finally turned a corner on Wednesday, posting a profit of $240,000 for the second quarter. Still, its shares dropped sharply as the company backed away from promising sustained profitability.

What’s more, earlier this month, DirecTV, which accounts for two-thirds of TiVo’s distribution, announced that it would stop marketing TiVo to its customers (although it will be available to those who request it). Instead, DirecTV will push a digital video recorder from the NDS Group, in which DirecTV’s parent, the News Corporation, holds a stake.

Recently, TiVo’s chief executive, Thomas S. Rogers, who was brought in on July 1, discussed the impact of the DirecTV announcement and TiVo’s distribution plans.

Following are excerpts from that conversation:

Q. What is your plan for putting TiVo on a fast track for growth?

A. Well, TiVo’s been on a pretty fast track for growth. The company really got going in any meaningful way in 1999, and five, six years later, it is a brand name that is used in such a way that it’s made it into some dictionaries. That’s a pretty fast emergence on the pop culture scene.

It’s got about three million subscribers that it’s grown to over that period of time. And it’s got a loyal, some would say fanatic, group of users who believe that it has totally changed the way they watch television.

That’s been pretty fast growth. With that has come a lot of expectations as to, okay, where does TiVo go from here? And with those expectations undoubtedly come some major risks, some major challenges and some tough issues that are no doubt staring TiVo in the face.

I think the one that gets asked more than any other is: three million subscribers is a good subscriber base, but can TiVo get to be true mass scale? And if so, how?

That is certainly one of the bigger challenges facing the company.

Q. What are your goals in terms of number of subscribers by the end of this year and end of next year?

A. I don’t believe there have been targets set like that, in terms of long-term growth for the company. We are looking hard at retail sales, retail distribution of TiVo and what we can do to evaluate alternative pricing and packaging plans that might accelerate TiVo’s growth.

Q. Was the summer $99 deal something you called for?

A. It was being evaluated before I took over. But we need to continue to evaluate other means of how retail sales can be driven.

TiVo is a product that once people have it, they absolutely love it. And when they have it, may people say they can’t live without it.

I am a BlackBerry addict, and I have had many a BlackBerry user like myself say “I would give up my BlackBerry before I’d give up my TiVo.” So, it has this very strong, loyal following.

One of the difficult challenges, though, is if you don’t have it and you haven’t experienced it, when you have somebody simply describe it to you – “Well, it records television shows, and it records them more easily than a VCR did” – it isn’t something by virtue of that description necessarily captures the essence of what people get from it and why it’s turned into a lifestyle product for a lot of people.

One of the other challenges is finding an ability to explain the product so that it is easier for people who are not initiated that get its benefits that those users who have it see.

Q. Do you plan to take a different marketing approach, or spend more on marketing?

A. Well, I think we’ll certainly do something different, because I’m not sure that we drove the kind of results last year from the expenditures that the company would have liked to have seen, so clearly we’re going to have to do something different.

Q. How does DirecTV’s announcement change things?

A. Clearly, the DirecTV relationship is going to be a very different one. There’s no doubt that TiVo’s going down a different path. And DirecTV has made very clear that they’re going to put their primary focus behind a proprietary box that they’re coming out with. That’s something that’s caused people to ask the question, “What does that mean for TiVo?” We do have a lot of subscribers from DirecTV already. We’re in the range of 2.5 million subscribers there, which is a very healthy contribution from a single distributor, and we are moving on to pursue plans with many distributors, one of which we’ve announced, which is the largest of all distributors, Comcast. Some of the analysts have pointed out the fact that DirecTV’s moving away may in fact create more opportunities with cable operators.

It raises some questions for DirecTV. It raises the question that we and some other people have, which is, What is the performance of their new box going to be? How are consumers going to perceive it? That has yet to be seen.

I think it’s very unclear what it means other than the fact that they clearly are not going to be looking to drive the TiVo as their primary DVR offering, and that will clearly diminish the ability of TiVo to relate to their customer base. And that’s been clear for a while, they continue to make it clear. As the new CEO, I’ve accepted that. I think that TiVo was not prepared to digest that as clearly as it was being said. But it’s being said very clearly, we’ve digested it, we’re focused on all kinds of other distributors who we’d love to see participate with us at the same level as DirecTV had. And as some analysts have said, it creates some interesting opportunities with cable companies who may see some real opportunities open up, because DirecTV is moving away.

It raises some questions for DirecTV. It raises the question that we and some other people have, which is, “What is the performance of their new box going to be? How are consumers going to perceive it?” That has yet to be seen.

It raises the question of DirecTV’s own vulnerability in terms of TiVo subscribers they have and how vulnerable they may be to be kicked off by cable operators, which is certainly something, given the number of TiVo subscribers they have and the high quality of those subscribers, what that means.

It raises issues of potential patent infringement that we and others need to assess in terms of what their new box does. So, there are a lot of questions for DirecTV here, but we’ve accepted the fact that they’re moving in another direction and we continue to move down the path we have, looking to get mass distribution wherever possible.

Q. What is the impact of being one of many DVRs offered by a distributor?

It’s pretty rare in the media world to have exclusivity. TiVo is a way to watch television, and it’s a brand, and I’m not – HBO doesn’t have exclusivity as a paid television channel, and Showtime shows up on every satellite or cable system as well as bunch of other movie channels. It’s very rare, in terms of what distributors do with a media brand a media product to have exclusivity. We simply want to be offered by all. We think if we’re offered by all -- unlike generic DVRs that may allow you to record a program, fast-forward through something; they don’t have the features and the attributes that have made TiVo the resounding success with its consumer base that it has been.

We think that as long as we’re offered, we’ll do very well. The issue is making the deals happen so we have that. So it’s a little harder than the program services such as CNBC or MSNBC that I’ve been involved with in that there’s a lot of technical integration inside a cable operator’s box that has to be done in order for the full TiVo experience to be made available.

Q. Isn’t your comparison of program services and TiVo an apples-to-oranges comparison? With program services, consumers may have more than one, but it’s not likely that they would have more than one DVR.

A. What I’m saying is that not every choice given to a consumer does a consumer take. We think that if we’re offered as a choice, we’ll do very well.

Remember, though, it’s also an interesting situation relative to a program channel, where your only way into the home is through a cable operator or a satellite provider.

We also have a direct-retail presence. We have that alternative. And we also build ourselves into other people’s electronic equipment, like Toshiba or Humax, that sell a DVD recorder or burner. So there are other paths of distribution as well, which is one of the reasons that being overly focused on a cable deal or satellite deal – which, if you’re a program channel, it’s your end-all-be-all way of accessing consumers – in TiVo’s case, it’s not.

Q. What kind of distribution balance among cable, satellite and retail do you hope to achieve?

A. We haven’t provided any future projections on that at this point. I think I’d see where over the course of the next year our deals with distributors are and how our various retail programs might be progressing. Right now, we’re about two-thirds satellite customer based and one-third retail based. Over time, that balance may or may not shift and I think we’ll have to evaluate a number of things before we have a better feel for that.

Q. Do your satellite subscribers have more value than cable subscribers?

A. Well, a stand-alone subscriber has more value to us, many multiple times more value, than a DirecTV subscriber. And that direct retail subscriber is the vast majority of our revenue. The revenue that flows from DirecTV subscribers is a much smaller amount. So the revenue consequence here is not as significant as the subscriber contribution. We’re certainly prepared to move on and look at all other kinds of distributors in the marketplace and look at what kind of contributions they can make.

Q. What else are you doing to increase your distribution?

A. One thing we’ve announced is a deal with the National Cable Television Co-op , which is an organization representing 14 million subscribers served by many of the smaller and rural operators. Their umbrella organization did a deal with us so their underlying members could sell the TiVo box that’s available at retail, as a way for their members to avail themselves much more quickly than cable operators that might look to build an integrated box. Much more quickly in terms of getting TiVo into the marketplace.

Q. What percentage of the consumer market are you aiming for?

A. Well, when you think of the fact that 93 percent of households don’t have a DVR, and how much customer satisfaction seems to come to television households that have one, there’s a lot of opportunity for growth in those numbers. And, without pinpointing what kind of market share we might have, there’s a lot of upside there.

Where we are focusing is continuing to present TiVo as the simple, elegant, easy way to record your shows, to fast-forward through your commercials, to search for things you may want to get to on television that you’re not sure where they are or what’s most related to your shows, to have a season pass that is a very easy way of just making sure that every week that shows up on your television are the things that you want.

The user interface, the menu, the septic cue tones – all those things that just make it a really simple, easy device that requires no technological expertise whatsoever to enjoy.

At the same time, we’re very focused on another set of issues, which is, if in TiVo homes – DVR homes – people fast-forward through commercials – the underlying essence of the television industry is advertising. We recognize that somehow we have to provide a way for advertisers to re-express their marketing dollars in a TiVo environment. So we’re heavily working with advertisers and part of TiVo in its current form provides a number of advertising and marketing opportunities.

Those are just beginning to evolve. They will be much more developed in a way that will be very consumer-friendly, because obviously one of the things consumers like is they don’t have to watch the commercials they don’t want to see.

We have to find a way to make sure that as we allow advertisers to re-express their dollars in a TiVo environment – in a way, quite frankly, that I think can be compatible with the interests not only of advertisers but of networks, that we do it in a way that’s consumer-friendly. And that’s something that’s a large amount of development work we are currently doing.

The other set of things that we hope will really keep us at the cutting edge so that TiVo continues to be set apart as a brand are the advanced television applications. The things that have really begun to resound with consumers. Mobility in television: you’re on a business trip, take your television shows with you. The kids want to take their shows on a family trip – the ability to do that with TiVo-To-Go, the announcement we made with Microsoft not long ago. The ability to remotely record something: You’re at work, you here about a great show from other people, you say, “Oh, I’m not going to be home in time, what do I do?” You can go right into the Web site and from there make sure your own TiVo from home records the show. You have multiple television sets in a household and you’ve recorded something on one set, but now you’re in the bedroom and you want to watch it on another – the networking of your TiVos to be able to send shows from television to television.

The ability to take shows from the Internet, which is a growing source of video, which today people don’t think is a full television experience, but over time, all that video coming in over the Internet may be an increasingly important part of what people think of as television. But it’s only going to be real television if you get it from your broadband wire, that now goes to your computer, and actually get it to your TV. Well, that’s not an easy thing to make sure that that stuff shows up on your television in the same menu, easily accessed in the way regular channels do. And TiVo is right at the cutting edge of doing that. So those are the kinds of things that I think will distinguish TiVo from a consumer point of view. The advertising capability distinguishes it from an industry point of view, assuming we continue to do that in a consumer-friendly way.

TiVo in its current form just being a really good way to find and record television programs has kind of hit the ball out of the park when it comes to the user experience.

Q. How much do you expect to increase revenue from advertising?

A. We have two forms of revenue, which is – a great media company, if you can create a subscriber revenue and an advertising revenue, is a great thing. Broadcasting tends to be only advertising. There are many services that are only subscription. The balance of the two is what you’d like to have, that so-called dual revenue stream model. Our subscription revenues today are far bigger than our advertising revenue, but with scale in the number of boxes, we hope we will develop a scale advertising business as well.

Q. How are you covering costs for the research and development of the new advertising models?

A. TiVo’s been a pretty efficient company. It’s got a lot of engineering resources. I think it’s probably got less resources devoted to the sales and marketing side, much less resources, than it has devoted to the engineering side. Increasing sales and marketing resources is something that the company is going to have to look at hard in order to continue to drive its subscriber growth.

But the ingenuity and the creativity of the engineering and software development teams are just remarkable. This is a group of people that see the future of television but don’t translate in terms that are over everybody’s head and in a way that you can’t comprehend. Instead, they take this sense of how people want to watch TV and relate to all the things that people will take as television in the future, and bring it back down and translate it in a very natural, hit-you-in-the-gut kind of way. I think it’s a remarkably creative, ingenious team in that way.

Q. How does TiVo relate to your background running Primedia and CNBC?

A. It’s interesting to see a product like TiVo, which in some people’s minds is an advanced digital product, but what it is is that interface with the existing media world and that point where the two touch each other, which is what TiVo’s all about. I’ve spent much of my career at that interface between traditional media and new media, how the two relate to each other, how the two evolve as one grows into the other – cable to broadcast, Internet and digital related to cable and magazines. All of those things have their touchpoints and I’ve spent a lot of time in those intersections.

Q. At Primedia, your time there began from a position of strength, with a high share price, to lows including selling off properties at the end. How do you feel coming in to a position that is at the point of challenges?

A. Well, Primedia certainly had many, many challenges, the biggest being the environment it was confronting at the time, which was a very difficult period of advertising for traditional media and Internet, and stock market all kind of coalescing post-9/11 at once.

TiVo has challenges, and some of them are quite significant. But the fact is, I’ve been in many situations before where people have said the challenges are very tough and the challenges are insurmountable to a company making progress. You just have to keep your eye both on the short-term and the long-term. Cut your challenges down to bite-size bits. Figure out what you can marshal the resources to do near-term, and keep your eye on the strategic path of where you need to go. And hopefully we’ll get there.

I think that it’s rare to have a company that has such a remarkable brand in terms of recognition, and such remarkable customer satisfaction to work with. And those are great tools to work with. And it is also remarkable to have a company that isn’t just stuck in time with a static product, but has actually thought through advanced applications and developed them so that they’re realities today. That’s a wonderful asset to work with.

The challenges around TiVo lie heavily in the distribution area, the sales and marketing area, and the resource-allocation questions that flow from that. But with all those risk challenges, when you look at 93 percent of households still being an opportune market to be able to drive this, there’s a lot of upside potential as well.

Q. Do you have a specific plan yet for achieving that?

I think in this sense, we do have a clear strategic understanding of our goals: We need to significantly grow the subscriber base of this company. In doing so, we need to make sure we develop an advertising business that can give us a dual revenue stream. And with all that, make sure the TiVo brand stands for not only what people think of TiVo think of today, but all kinds of future opportunities for experience.

With that, I think there are some immediate challenges that we will take a hard look at on the sales and marketing front, and within that specific area, I think we have some work to do to fully develop our strategies.

Q. Is television changing?

A. Well, one thing that clearly continues to change and has over the last 25 years are the number of options available to viewers. And you can never underestimate the number of programming options. We have gone from the most having four to seven over-the-air channels to people having cable in its earliest forms that brought that to 20 to 30 channels to satellite and digital cable today that provide 400 to 500 channels to some subscribers having video on demand a slew of additional channels beyond that.

I think that will continue. Whether that is from more opportunities for content to come in through a satellite or a cable wire to the broadband wire being a source of video programming as well as wireless opportunities and other things people point to. With that, TiVo rides a great wave, because just like Google on the Internet was all about: with so many information sources, how do you get to the one you want, and cuts through everything to get you just to the place you want to be. With more and more video choices, what TiVo does is get you to just where you want to be in television. It navigates for you, it provides the easy access in a world of vastly increasing choice. So I think the prospects for TiVo only increase as the complexity of the options available to consumers increases.
http://www.nytimes.com/2005/08/26/bu...interview.html





Should ISPs Pay for Music?

A scheme that would shift the cost of digital music from users to Internet service providers is gaining international support.

Though legal forms of digital distribution of music like iTunes and Rhapsody that charge users to listen to songs are gaining steam, some experts propose a more radical system for collecting revenues: making Internet service providers pay.

“There should be a tax on the people who really make money off the free music, which is the computer makers, the CD burner makers, the MP3 player makers, [and] the ISPs,” said Steve Gordon, an entertainment lawyer and author of The Future of the Music Business.

One new ISP, PlayLouderMSP, set to launch later this year, is bundling unlimited downloads with the regular cost of broadband. It announced its first deal with a major label, Sony BMG, early this week (see U.K. ISP Wins Music Contract).

RIAA Coming Around

File-sharing, the bane of the entertainment industry since the late 1990s, hasn’t been all bad—even for musical artists and labels. Peer-to-peer (P2P) technology for quickly and efficiently distributing files is now catching on for legitimate purposes, though major labels remain cautious and resistant.

Following the U.S. Supreme Court’s ruling against the business practices of P2P file-sharing networks in June, even Mitch Bainwol, chairman and CEO of the Recording Industry Association of America, had kind words for legit P2P.

“The Supreme Court has helped to power the digital future for legitimate online businesses including legal file-sharing networks,” said Mr. Bainwol. He called the decision “an opportunity that will bring the entertainment and technology communities even closer together.”

Harvard Pilot

William “Terry” Fisher, a Harvard law professor and director of the Berkman Center for Internet and Society in Cambridge, Massachusetts, is a key advocate of revising the process by which copyright holders get paid. His group is working on a project called the Digital Media Exchange, to be built next year. The Exchange would compensate artists by dividing customers’ subscription fees based on how many times a work is played.

Mr. Fisher said that the system would not use digital rights management to control the use of works. DRM is an increasingly heavy component of online music stores and services.

While there is concern that a lack of DRM might scare off music labels and movie studios, Mr. Fisher dismissed this fear.

“Especially for music, the system leaks like crazy right now,” said Mr. Fisher. “This is not going to add to the leakage; we will just create an alternate revenue source. It’s a way of making more money that doesn’t cost them anything.”

A potentially bigger challenge would be “devising a way of reconciling accurate counting on the one hand with privacy rights on the other hand.”

People fear targeted marketing based on knowledge of their preferences, he said, and watchers of porn or “junky action films” might not want their tastes to be known.

Mr. Fisher said his preference would be for governments to impose a tax on ISPs to collect revenue and make all works available to consumers. He says that China, some countries in Eastern Europe, and Brazil seem as if they might be open to this possibility.

Mr. Fisher also promoted a public copyright registry that lists owners of works. That way, when people want to use a song or film, they’ll know whom to ask.

Making Friends

ISPs would do well to offer content to their subscribers, said Andrew Parker, CTO of CacheLogic, a Cambridge, England-based firm that monitors and reduces ISP bandwidth usage.

“ISPs can’t squeeze bandwidth because they’re still in a land grab,” he said, referring to the intense competition to offer high-speed Internet. “The emotional relationship is with content. The danger is to become a mere conduit.”

And this week’s announcements of Verizon and SBC’s partnerships with Yahoo (see Verizon, Yahoo in DSL Hookup, Yahoo, SBC Team on Music, and Yahoo Fueling DSL Demand) show that ISPs are seeing the value of Mr. Parker’s thinking on the matter.

But ISPs and Hollywood are not quite buddies, as high-speed Internet revenues have been largely driven by illegal file-sharing.

“At least 60 percent of activity on broadband networks is file-sharing,” said PlayLouderMSP CEO Paul Hitchman. He contends his 18-month-old company is “flipping the traditional relationship of resentment between ISPs and content owners.”

PlayLouder is especially focused on replicating the social nature of file-sharing networks by allowing customers to trade songs. However, the DRM details are not yet settled, said Mr. Hitchman. It’s unclear whether subscribers will be permitted to burn CDs, download songs to their portable players, or keep songs after canceling their PlayLouder service.

The bargaining power of one ISP may not be enough to get music labels to allow these kinds of flexibility. And Mr. Hitchman notes that his negotiations are limited to the United Kingdom; his company will have to find outside partners to make the deals available internationally.

But there does seem to be international support for the idea of ISP-sponsored music, at least in theory. The Organisation for Economic Co-operation and Development (OECD) in Paris advocated such a system in its recent commentary on the digital music industry.

“If ISPs charge a few euros or dollars a month, it would be larger-than-average revenues from regular CD purchases,” said OECD economist Sacha Wunsch-Vincent.

“Deploying broadband or 3G is a huge investment,” he added. “It needs to be recuperated somehow, and the only way is with value-added services.

“There’s win-win situations between the ISPs and the consumer content providers which haven’t really been seized yet.”
http://www.redherring.com/Article.as...inmentAndMedia





How Do You Catch Your Tunes?

Beyond CDs, into a world of confusion
Michael S. Rosenwald

It's Tuesday. Album release day. A day that has historically brought much hullabaloo to many a record store. But as rain taps on the windows of Olsson's Books and Records in Bethesda -- it is, indeed, a beautiful day to nose around for an album -- there is not even a whisper in the CD aisles.

"Nobody even knows that Tuesday is album release day anymore," said Lucas Hayes, a music manager at the store, standing next to a promotional billboard for Ry Cooder's new album. "Sometimes I have to explain that to people."

There are now dozens of ways and dozens of places to buy music, nearly all of which involve clicking a mouse, not lining up at a record store. The main variable in waiting times is not the band, but bandwidth.

Nearly 140 million individual songs were (legally) purchased online last year, which is up from somewhere close to zero the year before, according to the Recording Industry Association of America. Purchases of single-track CDs were 3.1 million, down from 8.3 million the year before and 34.2 million at the start of the current millennium.

This year, one in five music buyers ages 12-21 bought music online, and one in three reported buying fewer CDs because they can procure just about anything they want online, according to a forthcoming survey by Forrester Research.

Music companies have had to move quickly to adapt, marketing songs and albums to subscription sites, Internet radio and even cell phones. However, wherever, whenever music can be played, record companies have pounced to get there. Warner Brothers last week announced the debut of a band on every format except CD; Sony is struggling to establish an online music store. Companies are even trying new CD technology that combines music, data (such as lyrics) and video on two-sided discs.

The choices and technologies in music-buying bring to mind the old saying about computers: As soon as you take one out of the box, it's obsolete. In the case of music, as soon as you decide how to purchase tunes, a new way (or technology) comes along.

"It's all very complicated, which is just crazy," said Ted Schadler, a music industry analyst for Forrester Research. "Unless you're a music lover, maybe you don't bother with it. It's hard to find your way around."

There's Apple's iTunes, for starters. Something called Rhapsody, which sells monthly subscriptions to music. Yahoo sells its version. Napster used to traffic in "shared" music; now it charges. There's eMusic.com. That's for independent labels. AOL sells tunes. Wal-Mart, too. And on and on.

Many music fans find all the choices exhilarating. Many more find it a dizzying mess.

For instance, when is a song good enough to warrant actually buying an album? Once that particular mystery is solved, do you buy the album online, through iTunes? Or make a trip to Olsson's? If so, do you then upload the CD to your hard drive for use with an iPod or other MP3 device?

The questions pile up like bad B-sides.

So Hayes, 26, has decided to dodge the digital music world altogether. He owns about 1,500 CDs. The CDs exist not in bytes, but in stacks -- lots and lots of stacks. He has downloaded few, if any, songs from the Internet. When he wants to buy an album, he uses his employee discount.

But he's learned a thing or two about how some people decide to buy music in what form.

For instance, people into classical music or jazz almost always buy actual CDs. That's because they are interested in the music's subtleties -- the highs of a saxophone, the lows of a bass drum -- that can be affected by the way digital files are created and compressed.

When it comes to rock music, he's found that the decision to buy a CD is often directly related to the band at hand. A Britney Spears album is generally not designed to be listened to in the same manner as a Radiohead album, which is to say as a collection of songs, a series of moments that add up to an experience, maybe even an epiphany.

The evidence:

"Oops! . . . I did it again. I played with your heart, got lost in the game," according to Spears.

Radiohead: "I call up my friend, the good angel/But she's out with her ansaphone/She says she would love to come help but/The sea would electrocute us all."

Hayes has also noticed that many music shoppers have a particular affinity for the $8.99 bin -- not for the price, though that's important, but for its contents. He points out an old Ry Cooder album. There's Billie Holiday. There's a remastered version of "Ocean Rain," released by Echo and the Bunnymen way back in time, in 1984.

"That's a classic album that everyone should own," Hayes said.

A classic album. That very description has gone classic, too.
http://www.washingtonpost.com/wp-dyn...082700234.html





The Claim: Violent Video Games Make Young People Aggressive
Anahad O'Connor

THE FACTS Republicans and Democrats alike screamed government waste last March when a group of senators suggested spending $90 million to study how video games "and other electronic media" influenced children's behavior. Surely an important question, critics of the plan said, but $90 million?

Some believe that, in any case, the verdict is already in. This month, the American Psychological Association called for a reduction of violence in all video games, saying the evidence from 20 years of research on the subject was clear. They based their conclusion largely on the work of Kevin M. Kieffer, a psychologist at St. Leo University near Tampa, Fla., who prepared an analysis of dozens of relevant studies.

He found that, in general, children exposed to virtual bloodshed showed greater "short-term" increases in hostility toward peers and authority figures than those exposed to more benign games. And many of the studies included in the analysis were randomized, rebutting the notion that aggressive people are simply drawn to violent games, Dr. Kieffer found.

But a separate study, also published this month, concluded that violent video games have no "long-term," or permanent, effects on aggressive behavior. The study, by a researcher at the University of Illinois, was among the first of its kind to follow two groups of people for a month, some randomly assigned to play violent video games and some not.

In the end, the study's findings may be more in line with public opinion. On the day its findings were announced, a jury in Alabama reached a guilty verdict in the case of Devin Moore, who killed three people when he was 18 and as his defense blamed the video game "Grand Theft Auto."

THE BOTTOM LINE Studies generally show that violent video games can have short-term, or momentary, effects on children, but there is little evidence of long-term changes.
http://www.nytimes.com/2005/08/30/he...gy/30real.html





Trends

Do You MySpace?
Alex Williams

IT seems a hazy memory, but Keith Wilson, a spiky-haired club promoter, can recall what it was like before MySpace - about two years ago. Back then people had normal names like "Joe" or "Keith."

"People don't call me 'Keith,' " he said, straining to be heard as cascades of power chords rumbled from the stage at Boardner's, a club just off Hollywood Boulevard, on a mid-August Wednesday night. "They call me 'Keith 2.0,' because that's my MySpace name. That guy over there, he's 'Joeymachine.' Everyone has a MySpace name now."

Dozens of extravagantly tattooed Hollywood urchins waited in a line down the sidewalk to join a sweaty throng inside the club, which that night was playing host to a weekly live rock series Mr. Wilson promotes called Club Moscow. The fans were there, he said, because they heard about the show on MySpace. The bands they were listening to were building a following by posting home pages on MySpace.

"I conduct my entire business through MySpace," said Mr. Wilson, 25, who relies on MySpace.com, a social-networking Web site, to orchestrate his professional and personal schedule and is no longer sure he needs an America Online account or even a telephone. "I haven't made a flier in years," he said.

Created in the fall of 2003 as a looser, music-driven version of www.friendster.com, MySpace quickly caught on with millions of teenagers and young adults as a place to maintain their home pages, which they often decorate with garish artwork, intimate snapshots and blogs filled with frank and often ribald commentary on their lives, all linked to the home pages of friends.

Even with many users in their 20's MySpace has the personality of an online version of a teenager's bedroom, a place where the walls are papered with posters and photographs, the music is loud, and grownups are an alien species.

Although many people over 30 have never heard of MySpace, it has about 27 million members, a nearly 400 percent growth since the start of the year. It passed Google in April in hits, the number of pages viewed monthly, according to comScore MediaMetrix, a company that tracks Web traffic. (MySpace members often cycle through dozens of pages each time they log on, checking up on friends' pages.) According to Nielsen/NetRatings, users spend an average of an hour and 43 minutes on the site each month, compared with 34 minutes for facebook.com and 25 minutes for Friendster.

"They've just come out of nowhere, and they're huge," David Card, a senior analyst with Jupiter Research, said of MySpace. "They've done a number of things that were really smart. One was blogging. People have been doing personal home pages for as long as the Internet's been around, but they were one of the first social networks to jump on that. They've also jumped on music, and there's a lot of traffic surrounding that."

"And," he added with delicacy, "I think a lot of their traffic comes from the pictures. I don't think there's anything X-rated, but there are lots of pictures of college students in various states of undress."

Even the founders seem taken aback. "I don't want to say it's overwhelming," said Tom Anderson, 29, who created MySpace with Chris DeWolfe, 39, "but I see these numbers coming out, I keep thinking, it must be a mistake. How can we pass Google? I mean, my mom knows Google, but she doesn't know MySpace."

One adult who has paid attention is Rupert Murdoch, the chief executive of the News Corporation, which agreed in July to pay $580 million to buy the site's parent company. At the time News Corporation executives explained the investment by citing MySpace's surging popularity among young people, who are often difficult to reach through newspapers and television.

The growth of MySpace - which is free to users and derives revenue from banner ads appearing on top of each page - is all the more striking because at its core it doesn't offer anything particularly new. Mr. Anderson, who has a master's in film studies from the University of California, Los Angeles, played guitar and sang in a band called Swank. He conceived the site while helping run an Internet marketing company he started with Mr. DeWolfe.

Internet commerce was then still recovering from the bursting of the bubble in 2000, although social networking sites like Friendster and Facebook were enjoying fad status with users who joined to track down old friends and troll for dates.

Mr. Anderson's idea was to expand the social-networking model into a one-stop Web spot, incorporating elements from other sites popular with the young: the instant- message capabilities of American Online, the classifieds of Craigslist.com, the invitation service of Evite.com and the come-hither dating profiles of match.com. The founders spread the word about MySpace through friends and anyone they happened to meet in Los Angeles at bars, nightclubs or rock shows.

"Since we're telling people in clubs - models - suddenly everyone on MySpace looks really pretty," recalled Mr. Anderson, who with his trucker hat and sideburns looks as if he could be gigging in a club himself later on. "That wasn't really the plan. It just kind of happened."

The soft-spoken Mr. DeWolfe, wearing a custard-yellow embroidered shirt and jeans, added, "It's sort of synonymous to how you start a bar." He has a master's degree in business from the University of Southern California and oversees the money side of MySpace.

From the beginning, independent filmmakers, actors, aspiring comedians and, particularly, unsigned rock bands have used the site to promote themselves - so many that MySpace became known, not quite accurately, as a music site (an impression reinforced now that acts like Weezer, Billy Corgan and Nine Inch Nails introduce albums there).

"I am Mr. Ben," one typical 19-year-old from Santee, Calif., writes on his home page. "I live in a suburb where a new shopping center makes everyone go loco it is so boring. I have got to find real people to talk to, thus I am on my space. I am here. Talk to me."

His is a plausible, if unwitting, manifesto for the countless users who chatter away on blogs into the wee hours, apparently needing to confirm that something is going on somewhere out there.

Members customize their home pages with zebra-stripe backgrounds and giant pictures of their favorite motocross riders, rock singers or bikini models. The site is also a testament to the exhibitionism spawned by cellphone cameras.

And a popular feature is the ability to assemble galleries of friends, with their photographs linking to their own pages. (As at many networking sites, MySpace members must receive permission from other members before adding them as friends, and sometimes "friendship" is no deeper than a brief e-mail exchange.)

Seabron Ward, 19, a student at the University of Colorado at Denver, said that many students consider it a status symbol to build a big friend list. "This one guy on my list has a thousand," she said, a bit enviously. "I only have 79."

The time-sucking potential of MySpace became an issue at the small record label where Ms. Ward works, Suburban Home Records, at least in the eyes of her boss, Virgil Dickerson. He said he started worrying when he noticed younger employees spending hours surfing through MySpace. "It was a drag on productivity, for sure," Mr. Dickerson, 30, said. "They were always goofing around, seeing if such-and-such added them as a friend or whatever."

In the winter three of his single employees got into relationships around the same time, meaning they could all graduate from the "single" designation on their MySpace pages. It was a big deal, and Mr. Dickerson gave an office party, complete with an ice cream cake with the message in frosting "Congrats Kyle, Joey, and Naomi on your MySpace Upgrade!""

As a man who makes his living from youth culture, he had to make peace with MySpace. His company has responded to a slow period in the record business by selling T-shirts on eBay that read, "MySpace ruined my life." "They're doing pretty awesome actually," Mr. Dickerson said. "I'd say, as far as a cultural phenomenon, MySpace is as important, if not more important, than MTV."

Like MTV, it is starting to create stars that glow brightly within its own universe. The band Hollywood Undead, which did not exist three months ago, has achieved celebrity thanks to MySpace. "We were just a bunch of loser kids who sat around our friend's house all day, and we started making music and recording it on computer," one of its vocalists, Jeff Phillips, said.

About two months ago the group posted a page on MySpace decorated with pictures of all seven members disguised in hockey masks and other forms of concealment. They also included a few original songs, a fusion of heavy metal and hip-hop. "In a matter of weeks it got huge, and it kept on getting bigger and bigger," said Mr. Phillips, whose left earlobe was splayed open enough to accommodate a hollow ring the size of a wedding band.

"It's been maybe nine weeks, and we've had over a million plays. We have 60,000 people who listen to it every day. It's crazy. If you look at our page, it's like we're a huge band that's toured a hundred times."

Hollywood Undead, Mr. Phillips said, is negotiating with major labels for a recording contract.

The biggest MySpace celebrity, however, is Mr. Anderson. His is the first face that pops up in every new member's box and therefore a man whose list of "friends" is 26.646 million and counting.

"Tom is a god," Mr. Phillips said. "Literally, anywhere I've seen him, when we're out with him, people just stop on the street. They're like, 'Tom!' They want his autograph, pictures taken with him. It's like he's a rock star."

Recently the growth of MySpace has allowed the company to move into sleek new headquarters in Santa Monica with glassed-in offices. Mr. Anderson acknowledges that he runs into employees whose names he does not know. The MySpace founders said the company will be starting its own record label in partnership with a major label shortly.

At the time of the News Corporation's decision to buy the site, Mr. Murdoch was asked by reporters if he was nervous putting more than half a billion dollars on two little-known entrepreneurs. "You bet," he answered. But he said his fears were allayed once he met Mr. Anderson and Mr. DeWolfe.

The founders seem reluctant to discuss anything about their coming absorption into the world's largest media conglomerate. Their silence suggests they may be nervous about losing their credibility as alternative-culture figures with MySpace members. They insist nothing will change. They will keep the same job titles, they say, and the site will look and feel the same.

"We get to keep doing what we're doing, and have more money to do it," Mr. Anderson said. "We're not moving over there, they're not coming over here. We just kind of go talk to them once a month and let them know what's up."

He said that as he meets with bands to sign up for the new label, he keeps hearing the same question: "How are you going to get me on MTV?"

"They don't quite get it, and I'm only starting to get it myself," Mr. Anderson said. "We've got our 26 million, with a lot more people logging in each day."

He added, with a shrug, "It's kind of like, who cares about MTV anymore?"
http://www.nytimes.com/2005/08/28/fa...28MYSPACE.html





While supplies last

Opera 10-Year Online Anniversary Party
Jack

Operating in perfect inverse proportion to the adage that the quality determines the market share, the crazy Nords of Opera Software threw a party and gave away software! It’s the 10th year online for a little company that makes the fastest browser on earth, and one of the very few that actually costs money. But during this icy bash user keys were free for the clicking. Now the only way to get them is to know somebody from Norway, or join the affiliates program. I guess you had to be there.





FCC Extends E911 Deadline For VoIP Users
Marguerite Reardon

Thousands of Internet phone users who have not yet acknowledged limitations to their providers' 911 service will get an extra month before their service is cut off.

On Friday, the Federal Communications Commission said it would extend the deadline another 30 days, to Sept. 28, 2005, for voice over Internet Protocol (VoIP) providers to notify all their customers of the limitations of E911 service and for customers to acknowledge the notification.

The FCC was set to begin enforcing its requirement starting next week that Net phone services connected to the public telephone network--known as "interconnected" services--receive acknowledgment from 100 percent of their customers about the limitations of so-called enhanced 911, or E911, service.

About 1.5 million VoIP customers have received notification of the limits and made the necessary acknowledgments, according to FCC reports. But industry groups estimate that as many as 100,000 residential VoIP subscribers haven't formally acknowledged possible pitfalls in E911 access.

The FCC deadline has sparked concern from the industry that the seemingly hard-and-fast cutoff rule might do more harm than good, leaving some customers who were unaware of the requirement suddenly stranded.

Several groups including the Voice on the Net Coalition, which represents more than a dozen companies in the VoIP sector, sent a letter to the FCC this week requesting that the acknowledgement deadline be extended to Nov. 30. The Florida Public Service Commission also urged the FCC to abandon the disconnection penalty or extend the deadline.

At issue is access to the enhanced 911, or E911, system, which allows emergency operators to link a caller's physical location with the phone number used to dial for help. While conventional telephones in most areas of the country have had that capability for years, not all VoIP providers have the technology in place to route their calls to that system. Cell phone companies also have requested more time to upgrade their products.

Many analysts say that cutting off phone service is not the best solution because most people using VoIP services today have stopped subscribing to traditional phone services. As a result, if the VoIP service is cut off, they won't have any phone service.

This is great news," said Jeff Kagan, a telecommunications industdry analyst. "But better would be to find another solution and within the 30 days. While we do need to address the E911 issues, and while users need to understand the problems, cutting off their phone service is no longer an option. This is 2005, for crying out loud."
http://news.com.com/FCC+extends+E911...3-5843590.html





Judge OKs Settlement In iPod Battery Suit
By Ina Fried

A Superior Court judge in San Mateo County, Calif., has given final approval to a settlement that will compensate iPod owners whose music players' batteries failed to hold a charge.

A preliminary settlement was reached in May. Under the terms of the deal, buyers of first- and second-generation iPods with battery issues who bought their iPods on or before May 31, 2004 can get either a $25 check or $50 in credit at an Apple Computer store.

Those who bought third-generation iPods on or before May 31, 2004 can either get a $50 credit or send their iPod back to Apple and have the battery fixed or get a replacement device.

People wishing to file a claim must have their paperwork postmarked by Sept. 30. For extended warranty service on third- generation iPods, buyers have until Sept. 30 or two years from the date they bought the iPod, whichever is later.

Additionally, customers who paid Apple to repair their first-, second- or third-generation iPod battery within two years of purchasing the device are eligible for a refund of half the cost of such repairs. Until recently, Apple charged $99 for those fixes, though the company now offers service for $59 via its Web site.

Under terms of the deal, battery failure is defined as a device whose battery charge has dropped to four hours or less of continuous play in third-generation iPods and five hours or less in first- and second-generation devices.

"This is a very good settlement in that it gives consumers with defective batteries what they need--to have the battery of their iPods replaced, and in some cases the whole player," Steve Williams, one of the lawyers that brought the suit, said in a statement on the Web site of his firm, Cotchett, Pitre, Simon & McCarthy.
http://news.com.com/Judge+OKs+settle...3-5843768.html





S+E*X

The Internet Again In The Political Crosshairs
Declan McCullagh

Social conservatives helped to re-elect President Bush last year. Now his administration is returning the favor with a crackdown on sexually explicit material.
As usual, the Internet is in the political crosshairs. The Family Research Council recently demanded that the Bush administration do something about the .xxx domain--a zone reserved for adult content and set for final approval this month.

The administration was happy to oblige. Michael Gallagher, assistant secretary at the Commerce Department, asked for .xxx to be put on hold. Now its future is uncertain.

The same pattern is repeating elsewhere in the administration. When Bush needed to appoint a successor to Michael Powell, the chairman of the Federal Communications Commission, the president could have chosen someone to relax Powell's "indecency" crackdown.

Instead, Bush chose Kevin Martin, who holds even more expansive views of what's indecent than his predecessor did.

Calling for a crackdown on sex sites through new taxes, regulations or prosecutions might make headlines--but it's just political posturing. Martin voted against airing "Saving Private Ryan" on broadcast TV, and his candidacy was embraced by the Parents Television Council. Now Martin has hired Penny Nance, an antiporn religious activist, to be his adviser. Until a few weeks ago, Nance was a board member of Concerned Women for America, which has a mission statement of bringing "Biblical principles into all levels of public policy."

Bush's Justice Department has not been idle. Bruce Taylor, the president of the National Law Center for Children and Families who claims to have been responsible for the most obscenity prosecutions in the history of the United States, has been hired to lend a hand.

Former Attorney General John Ashcroft was the butt of jokes from late-night comedians for his morning prayer sessions and his staff's decision to cover the naked breasts of a statue in the Justice Department.

But it was Ashcroft's successor, Attorney General Alberto Gonzales, who targeted adult Web sites by burdening them with onerous record-keeping requirements. Those rules currently are being challenged in court. So is the Child Online Protection Act, defended by the Justice Department and opposed by mainstream publishers including Salon.com, the American Booksellers Foundation for Free Expression and News.com publisher CNET Networks.

Expanding 'indecency'
Congress is becoming just as censorial. One example is a proposed tax on adult Web sites. Another is a bill approved by the House of Representatives that would boost fines for broadcast "indecency" from $32,000 to $500,000 and punish stations with possible loss of their broadcast license.

Now the Senate is talking about expanding that idea to cable, satellite and the Internet. "We ought to find some way to say, 'Here is a block of channels, whether it's delivered by broadband, by VoIP, by whatever it is, to a home, that is clear of the stuff you don't want your children to see,'" Commerce Committee Chairman Ted Stevens, R-Alaska, told reporters in March. (VoIP stands for voice over Internet protocol.)

Even though cable channels currently are not covered by "indecency" restrictions, some have been self-censoring to avoid the ire of the self-appointed morality mavens in Washington.

John Landgraf, president of FX Networks, told a conference in Aspen, Colo., last week that his shows are "rated, they're V-chipped and there's a detailed graphical (warning)." FX's lineup includes "Rescue Me" and "It's Always Sunny in Philadelphia."

"You'd really have to be blind and deaf to watch the shows and never know--we make it quite clear they're adult shows for adults," Landgraf said, adding that FX won't air racy shows earlier in the evening. "Even though technically we're not regulated and there's nothing the FCC could do, we feel that we have little choice right now."

Risk of collateral damage
The problems with Washington's new focus on pornography are twofold: It won't work, and it won't stop with adult sites.

Calling for a crackdown on sex sites through new taxes, regulations or prosecutions might make headlines--but it's just political posturing. Sexually explicit material isn't limited to the United States, and persuading the Dutch to pull the plug on sites based in Amsterdam is as likely as persuading France to endorse the invasion of Iraq.

The second problem is that antiporn laws are touted as targeting smut, but they end up being used to suppress unpopular ideas.

Victims of obscenity law in the not-so-distant past include a literary review with works by Jack Kerouac and William S. Burroughs, Henry Miller's "Tropic of Cancer," the classic tale of "Fanny Hill," James Joyce's "Ulysses," and, in the last decade, comic book artist Mike Diana.

Indecency regulations are even broader. The FCC has ruled that utterances of four-letter words can be punished--a sweeping categorization that includes news articles, dictionaries, sex education sites, and transcripts of conversations between the vice president and a U.S. senator.

Technology including the V-Chip, white-listed Web sites in Apple Computer's Tiger operating system, and even the humble off switch are more effective ways to shield children from porn without collateral damage to free expression. But because politicians wouldn't be able to claim credit--or appease their social conservative supporters--we should expect more of the same.
http://news.com.com/The+Internet+aga...3-5843843.html





Move to ban violent adult porn on internet

Campaigners Back Plan To Outlaw Images From Abroad
Julian Glover

The Home Office will today propose to outlaw the possession of extreme adult pornography downloaded over the internet from abroad.

Although the existing Obscene Publications Act makes publishing such pornography an offence, the government argues that the internet has made getting hold of it easier while at the same time allowing suppliers to evade prosecution. In a consultation document published today the Home Office suggests making illegal "the possession of a limited range of extreme pornographic material featuring adults". It cites the depiction of bestiality, sexual interference with a human corpse or certain forms of extreme violence involving serious bodily harm.

"This is material which is extremely offensive to the vast majority of people and it should have no place in our society," said the Home Office minister, Paul Goggins. "The fact that it is available over the internet should in no way legitimise it. These forms of violent and abusive pornography go far beyond what we allow to be shown in films or even sold in licensed sex shops in the UK, so they should not be available online either."

The government and campaigners cite the case of Jane Longhurst, killed in 2003 by a man obsessed with violent sexual pornography. Her mother Liz, who has helped organise a petition that has so far been signed by more than 35,000 people, yesterday welcomed the proposed new law.

She was joined by Labour backbencher Martin Salter, another of the petition organisers. He said Mrs Longhurst was motivated "by the desire to ensure that other patients did not experience her dreadful loss when her lovely daughter Jane was murdered by a sick, self-confessed addict of extreme internet porn. Now at last the loophole in the law caused by the creation of the internet will finally be closed".

The consultation document admits that research into the subject is not advanced enough to confirm the link between such pornography and violent crime. "We recognise that accessing such material does not necessarily cause criminal activity," it says. "We consider the moral and public protection case against allowing this kind of material sufficiently strong."

The document reveals that there are "hundreds of internet sites offering a wide range of material featuring the torture of [mostly female] victims who are tied to some kind of apparatus or restrained in other ways and stabbed with knives, hooks and other implements. Depictions of necrophilia and bestiality are also widely available".

The consultation document suggests various ways in which the law could be changed to mirror existing rules on child pornography. These make possession as well as publication an offence and have led to a series of high-profile prosecutions in recent years while other prosecutions under the Obscene Publications Act have declined.

Yesterday the Association of Chief Police Officers' spokesman on sexual violent crime, Commander Dave Johnson, backed the consultation, which runs to December. "The internet is being targeted more and more by those who create sites that specialise in sexual violence and other types of extreme perversion," he said. "Many of the sites are abroad and outside the jurisdiction of United Kingdom law enforcement agencies. Opportunities for prosecution only exist when links to such sites are found in this country."

The Liberal Democrats also welcomed the consultation. But the chairman of the Lib Dem parliamentary party, Paul Homes, added: "Obviously we need to ensure that the right balance is struck between preventing the spread and production of extreme, violent and degrading pornography whilst ensuring that the legitimate private sexual freedom of adults is not undermined."
http://www.guardian.co.uk/online/new...558900,00.html





Ohio Inmates Mistakenly Shown Porn Video
AP

A deputy warden at the Ross Correctional Institution was suspended for five days last month after he mistakenly showed inmates a sexually explicit television show.

Andrea Dean, spokeswoman for the Ohio Department of Rehabilitation and Correction, said Jeffrey Lisath meant to only record an HBO boxing match but unintentionally taped part of a program that followed it.

Lisath, 45, was suspended because he didn't first submit the tape to a screening committee that approves all home videos shown to inmates, Dean said.

Corrections Officer R.A. Adams wrote in an incident report that he was alerted to the movie by an inmate who asked him, "Why are they showing porn movies to all the rapists and child molesters in here?"

Dean said Lisath would not speak to reporters.

"He thought that he was just doing something for the inmates, giving them an opportunity to see the boxing match," she said. "It was something that was well-intentioned, but it turned into something bad."
http://hosted.ap.org/dynamic/stories...=ENTERTAINMENT





New Music Service Knows What You Like

Pandora creates online radio stations based on your musical preferences.
China Martens

If you know the kind of music or musicians you like, online music discovery service Pandora, could be right up your alley. The service, which debuted this week, builds up tailored streams of music based on a user's stated preference for an artist or a song.

Pandora Media, formerly known as Savage Beast Technologies, based its new service on the Music Genome Project, the company's close to six-year study of the 300,000 songs of more than 10,000 artists undertaken by 30 musician analysts, Pandora Media says in a release.

The analysts rate each song across 400 musical traits including melody, harmony, rhythm, orchestration, and lyrics. In this way, the linkages between pieces of music aren't strictly tied to a specific genre or artist, meaning users may discover artists and songs they're unfamiliar with. It takes 20 minutes to 30 minutes to process each song, according to information on the company's Web site.

Free, Then Fees

The first 10 hours of Pandora are free. After that, subscriptions costs $3 per month or $36 per year. Subscribers can set up a maximum of 100 online radio stations tuned to their preferences and further tailor the selections by giving a thumbs up or down to each song played. Users can click a "why is this song playing" button to find out the reasoning behind the company's team of analysts rating a particular song as similar to a user's original stated preference.

Due to music licensing restrictions, the Pandora service can't play songs by request, according to information on the company's Web site. Instead, the service uses the song title as the basis for building up a radio station, with the specific song likely to show up at some point on that station. Licensing constraints also prevent the service from offering a rewind function. Pandora has links to Amazon.com's Web site and to Apple Computer's ITunes digital music service so users can buy the music they hear.

Pandora runs on Windows 2000 and Windows XP operating systems via Internet Explorer 6 or Firefox Web browsers. It also runs on Apple's Mac OS X version 10.3 operating system with Safari or Firefox Web browsers.
http://pcworld.com/news/article/0,aid,122333,00.asp





People want to get their music online, and currently P2P is the best way to get it -- not because it's free, but because it's there.

Can't Kill P2P
Annalee Newitz

There's this great, whiny song by Ozzy Osbourne from back in the day (before the TV show and all that crap) in which he screams, "You can't kill rock and roll -- it's here to staaaaaay!" Although remarkable for its cheesy sincerity, Ozzy's was just one of many songs expressing such sentiments back in the late 20th century. By then, it was pretty damn obvious rock couldn't be stopped, despite the efforts of Tipper Gore and the Christian evangelists. Yet clearly Ozzy still felt sort of threatened, or at least besieged enough that he needed to pen yet another paean to the juggernaut of rock, the world's most dangerous musical genre (later surpassed by rap).

I'm starting to feel like Ozzy. I want to yowl about peer-to-peer file-sharing software, a geeky topic I think Ozzy, with his reputation for biting the heads off bats, would appreciate. Like rock 'n' roll, P2P is not going to die -- despite hype storms to the contrary.

BigChampagne, a company that charts the usage of P2P networks, reported in June that 9.9 million people are using them simultaneously at any given time. That's a 20.1 percent jump from last year. And it's double the number from September 2003. The recent Supreme Court decision in MGM v. Grokster will leave some P2P companies open to lawsuits, and yet those companies are still holding their digital swap meets in which people trade files online. The Motion Picture Association of America and the Recording Industry Association of America brought several thousand lawsuits against individual file-sharers over the past year, but people are still flocking to BitTorrent, Kazaa, eMule, and all the other glorious free networks designed to facilitate quick information-sharing across the planet.

The entertainment industry, whose representatives have tiresomely insisted that their profits are being decimated by P2P, isn't really doing that badly after all. The film industry says DVD sales grew 33 percent in 2004. And in an extensive research report, the Economist has concluded that music sales grew by a few percentage points in 2004 too.

Now here's the really interesting thing. In a recent bulletin, the wackily named International Federation of the Phonographic Industry (an international version of the RIAA) said that "music fans downloaded well over 200 million tracks in 2004 in the US and Europe -- up from about 20 million in 2003." These were legally purchased tracks, by the way. So if we assume a comparable amount of growth in legal downloading this year, I think it's safe to say that buying shitloads of lame new music from major labels online will become as popular as P2P sharing. And indeed, the market for legal downloading is growing as fast as P2P: Internet industry analysts at Jupiter Research said earlier this month that the digital music industry is currently worth $350 million and is expected to double in the coming year.

Amusingly, $200 million of that revenue is from ringtones alone. Now what does that tell us? That people are so desperate to download music online that they'll buy anything -- even stupid ringtones -- if it's easily gotten in sufficient variety. Similarly, as soon as record companies made their music available online, via P2P networks or in stores like iTunes or Yahoo! Music, people started buying it like crazy. Maybe the popularity of P2P networks isn't about people wanting to "steal music," as the RIAA would like you to think. Maybe it's just about people not wanting to go to scabby old Tower Records for their music. Maybe it's just that people want to get their music online, and currently P2P is the best way to get it. Not because it's free, but because it's there.

Finally, some bigwigs in the music industry are starting to get it. Earlier this month Sony BMG announced it had made a deal with British ISP PlayLouder to make its entire music catalog available to the ISP's customers. That means anyone with a PlayLouder account can download any Sony BMG song, in any format, from any P2P network, perfectly legally, for free. Doesn't that sound civilized?

Imagine if anyone who had an Earthlink account could use BitTorrent for legal downloads of every Bruce Springsteen CD. What Sony BMG is acknowledging is that P2P is the new radio. People are using P2P to listen to music all day, discover new artists, and (yes) tape their favorite stuff to hear later. All these things will lead to bigger revenues for Sony BMG in the same way that radio play for their artists has in the past.

And yet, just last fall, a group of 47 state attorneys general wrote an open letter to the P2P industry urging it to "take direct and meaningful action" because mostly P2P networks are used for child pornography and crime. Here we are, almost 30 years after Ozzy's anthem shook my little ghetto blaster, and we're still being pummeled by lawmakers and hypocritical authority figures because of all the supposedly scary things wrought by youth music culture.

But I've got news for you. You can't kill P2P -- it's here to staaaaaay!

Annalee Newitz is a surly media nerd who notes that in 25 years P2P may be sold-out and starring in its own reality TV show, so don't say she didn't warn you.
http://www.infoshop.org/inews/articl...50830172731749






P2P Pirates Give Booty To Katrina Victims
John Stith

The Distributed Computing Industry Association (DCIA) and a trade organization for peer-to-peer software providers, content rights holders, and service-and-support companies will offer P2P users a chance to help Katrina victim by buying and sharing music.

P2P users, more than 10 million strong in the U.S. alone, will be able to download the song "This Too Will Pass," by Scooter Scudieri and distributed via P2P networks like BearShare, eDonkey, Grokster, Kazaa and TrustFiles by the INTENT MediaWorks company.

Users can preview the song for free and they can download it for 89 cents, 80 of which will go to the American Red Cross for support of hurricane victims. The track will be secured using the Weed technology of Shared Media Licensing.

"Hurricane Katrina, which devastated parts of Louisiana, Mississippi, and Alabama, is inspiring traditional and digital media to respond with fund-raisers. As the newest online distribution channel, we felt we should also take responsibility to help victims," said DCIA CEO Marty Lafferty in announcing the launch of this program.

"In the coming days and weeks, other DCIA Members will contribute additional content to this program, and we expect a strong response from P2P users who want to do their parts," he added.

The storm destroyed much of the Gulf Coast both in terms of human life and infrastructure. They will need all the help you can spare. To donate, please contact the American Red Cross.
http://www.webpronews.com/news/ebusi...naVictims.html
















Until next week,

- js.


















Current Week In Review





Recent WiRs -

August 27th, August 20th. August 13th, August 6th, July 30th, July 23rd

Jack Spratt's Week In Review is published every Friday. Please submit letters, articles, and press releases in plain text English to jackspratts (at) lycos (dot) com. Include contact info. Submission deadlines are Wednesdays @ 1700 UTC.


"The First Amendment rests on the assumption that the widest possible dissemination of information from diverse and antagonistic sources is essential to the welfare of the public." - Hugo Black