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Old 07-07-10, 07:49 AM   #1
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Default Peer-To-Peer News - The Week In Review - July 10th, '10

Since 2002

"Then get a fucking job. If you're trying to make a living by selling information and you wind up going broke, then you have nobody to blame but yourself." – Anonymous Coward

July 10th, 2010

Massive Hurt Locker File Sharing Lawsuit Has No Effect on Downloads

The copyright holders have not issued any takedown notices so far
Lucian Parfeni

Internet piracy is as rampant as it has ever been and millions of people turn to peer to peer networks or various sites to get their hands on the movies, music or software that they want. The phenomenon is complex, but one of the big reasons people turn to file sharing is the convenience and not necessarily the price. That is to say, many illegal file sharers would pay if it was easy enough for them to do it.

Most old school companies haven’t provided the alternatives that customers want and are, in fact, fighting vigorously to limit their choice. That said, at least some companies have managed to adapt to the new environment and generate some revenue in process. Unfortunately, that doesn’t always mean what you’d expect.

One way copyright holders groups have been making money online is by threatening to sue everyone that might have downloaded an illegal copy if a movie, for example. The practice has recently made its way into the US, where the producers of the Oscar winning movie Hurt Locker are suing 5,000 people for their downloads.

The move has all the makings of a classic shakedown scenario. Users receive notification letters informing them that they are being accused of illegally downloading the movie and that they can choose to pay for a ‘settlement’ to handle the business out of court. The system works because most people choose the settlement option as they don’t want to be dragged into a potentially expensive lawsuit.

Still, the production company and the US Copyright Group that is representing them say that all of this has to do with file sharing and how it’s destroying the movie industry. Incidentally Hurt Locker has been a box office flop. Yet, so far, the actual illegal downloading of the film continues undeterred.What’s more, there appears to be absolutely no DMCA takedown notices issued to sites providing torrent files of the movie. Last month alone, the movie was downloaded 200,000 times, Torrent Freak reports. It’s as if the copyright holders want to have the movie downloaded as many times as possible, unlikely as that may seem.

P2P Plaintiffs to Get Just 28 Time Warner IPs Each Month
Nate Anderson

Suing tens of thousands of accused peer-to-peer movie file-swappers—it can be a lucrative business model, but it works well only when Internet service providers can turn huge lists of IP addresses into real names and addresses in a timely fashion. But what if a major ISP like Time Warner Cable only had to do 28 of these lookups a month? And might take three years to burn through its entire list?

Time Warner Cable has pleaded with the federal judge overseeing several of the P2P cases brought this year by the US Copyright Group. The company averages 567 IP lookup requests per month, nearly all of them coming from law enforcement. These lookup requests involve everything from suicide threats to child abduction to terrorist activity, and the company says that such cases take "immediate priority." It says that, without a major staffing increase, it simply cannot turn around more than 1,000 requests in a timely fashion without compromising the much more important requests from law enforcement.

TWC requested that the judge limit subpoena lookups for the US Copyright Group to 28 per month. In response, lawyer Tom Dunlap blasted TWC as a "good ISP for copyright infringers." He went on to threaten the company, saying, "To the extent TWC’s tactics are just that—letting the public know that TWC is a good ISP for copyright infringers because TWC will fight any subpoenas related to infringers’ activities—TWC exposes itself to a claim for contributory copyright infringement."

Judge Rosemary Collyer, who is overseeing the Far Cry and The Steam Experiment cases, doesn't agree. In a recent ruling, she has modified TWC's subpoenas so that the company "shall provide identifying information for a minimum of 28 IP addresses per month." And that's not 28 per month, per case; it's 28 per month total for both cases combined.

How long will it take to get through all these subpoenas? Several months ago, TWC faced 809 lookup requests related to the Far Cry case alone. Since that time, the plaintiffs have added several thousand more IP addresses to the case, and more requests have come from the Steam Experiment case.

Assuming a lowball estimate of 1,000 IP addresses that belong to TWC, the company may take nearly three years to do all of its lookups.

Collyer's ruling doesn't affect the other P2P cases brought by US Copyright Group that are being heard by other judges, and it doesn't affect other ISPs (TWC was the only one to object so strongly). But it does suggest that federal judges are sympathetic to the argument that law firms can't simply dump thousands upon thousands of IP addresses on ISPs and demand quick responses.

In addition, Judge Collyer refused to "sever" the thousands of defendants in each case, as requested by the EFF and ACLU. "But they may be severed in the future," she wrote.

Craig Labovitz

This week agents from the US Customs and Homeland Security agencies seized assets (including DNS domain names) from fifteen streaming Internet video companies, including PlanetMoviez.com, Movies-Links.tv, Filespump.com, Now-Movies.com, ThePirateCity.org, NinjaVideo.net, NinjaThis.net and TVshack.net.

The US government complaint alleged that these web sites illegally distributed pirated first-run movies and television shows in exchange for small subscription fees and advertisement revenue.

In addition to domain names, US officials also seized bank accounts and executed search warrants in four states.

The video sites reportedly collectively enjoyed more than 7 million unique visitors per month and all ranked in the Alexa Top 10,000 (Tvshack.net ranked 1,762).

Though the actual servers hosting the alleged pirate web sites resided in different countries (including the Netherlands and Germany), the video sites registered the domain names using US based companies.

Which all brings up some interesting questions.

Jurisdiction and policy are tricky things in this age of a global Internet.

In particular, government and court jurisdiction over virtual global Internet shared resources pose interesting extra territorial jurisdiction and sovereignty questions.

In the specific case of civil commercial trademark and copyright disputes, the Internet benefits from a long international intellectual property legal tradition with the ICANN Uniform Dispute Resolution Policy. While imperfect, the UDRP process works and has resolved thousands of commercial domain name intellectual property disputes.

But beyond UDRP settlements, criminal jurisdiction over DNS and other shared global Internet resources remains a murky and rapidly evolving virgin legal territory.

We’ll explore a few recent cases:

* In 2003, the US government seized the domain name for isonews.com after the site ran afoul of the Digital Millennium Copyright Act (the site provided Xbox modding instructions). While other derivative sites quickly sprang up after the seizure, isonews has mostly passed into relative obscurity.

* More recently in 2008, Kentucky courts seized the domain names for 141 online gambling sites (all for companies based in other countries including Malta and Costa Rica). The Kentucky court action threatened to disrupt global traffic to PokerStars, Full Tilt, Absolute Poker and many others. As of March of this year the case is still winding its way through Kentucky appellate and supreme court (the case has been reversed then upheld and is currently resolving issues of standing).

And if DNS domains for foreign companies using .net or .com can be seized by the US, do foreign governments have jurisdiction over registrars incorporated in their countries? In the US?

Even more interesting, if DNS domain names are property then do the courts have jurisdiction over the root servers? Could a foreign court order US providers to stop accepting BGP route announcements or revoke IPv4 address assignments?

Or maybe the legal issues are an intellectual curiosity but not terribly important from a practical perspective.

The real question is did the US Customs and Homeland Security domain seizure have an impact on the steady flood of illegal movie downloads / streaming?

Tvshack (as well as several other movie sites) uses a Dutch Hosting provider, Ecatel (AS29073), with multiple data centers in Amsterdam, The Hague and Stockholm. Ecatel uses GlobalCrossing and Terremark for upstreams and maintains dozens of smaller peering sessions at the AMS and NS exchange.

While Ecatel has many other hosting customers besides Tvshack, few are likely as large. You can see the impact of the Wed June 30th tvshack domain seizure on AS29073 traffic above. Within hours of the takedown, Ecatel traffic dropped by more than 25%.

During the Wednesday press release announcing the US government action, ICE Assistant Secretary John Morton declared “I don’t think we’ve stopped Internet piracy in a day”.

It turns out Mr Morton was right.

The seizure did not stop piracy within a day — not even half a day.

Four hours after the seizure, tvshack administrators registered a new domain name. But this time, tvshack selected a Chinese registrar and a Cocos Islands ccTLD.

Traffic is now rapidly climbing to the renamed tvshack.cc site.

Pirate Bay Hack Exposes User Booty

Security weaknesses in the hugely popular file-sharing Web site thepiratebay.org have exposed the user names, e-mail and Internet addresses of more than 4 million Pirate Bay users, according to information obtained by KrebsOnSecurity.com.

An Argentinian hacker named Ch Russo said he and two of his associates discovered multiple SQL injection vulnerabilities that let them into the user database for the site. Armed with this access, the hackers had the ability to create, delete, modify or view all user information, including the number and name of file trackers or torrents uploaded by users.

Russo maintains that at no time did he or his associates alter or delete information in The Pirate Bay database. But he acknowledges that they did briefly consider how much this access and information would be worth to anti-piracy companies employed by entertainment industry lobbying groups like the Recording Industry Association of America (RIAA) and the Motion Picture Association of America (MPAA), each of which has assiduously sought to sink The Pirate Bay on grounds that the network facilitates copyright infringement.

That effort has largely failed, but both industries have been busy suing individual music and movie downloaders for alleged copyright violations, often obtaining substantial monetary damages when defendants settled the charges out of court. In almost every case, the entertainment industry learned the identities of file-sharing users by subpoenaing subscriber information from Internet service providers based on the user’s Internet address.

“Probably these groups would be very interested in this information, but we are not [trying] to sell it,” Russo told KrebsOnSecurity.com in a phone interview. “Instead we wanted to tell people that their information may not be so well protected.”

Russo showed this reporter what appeared to be the user names and MD5 hashed passwords of the top administrators and moderators for the site. Russo volunteered to send me the e-mail address and hash of the password that I used to register on the site in exchange for my Pirate Bay user name. A follow-up communication showed that he did in fact have access to that information.

On Monday, I left a message requesting comment in the contact portion of thepiratebay.org, but haven’t yet received a response. I will update this post if that changes. I also sought comment from a Pirate Bay representative at the organization’s official IRC channel, but was unceremoniously kicked and banned from the channel after pasting the user names and hashed passwords of the site administrators and moderators.

Russo said The Pirate Bay administrators appear to have removed the Web site component that facilitated access to thepiratebay.org user database, although he added that he’s had no direct contact with the site administrators about his findings.

Russo, who turned 23 this week, is the creator of a subscription-based software vulnerability exploit service called Impassioned Framework. The young hacker said he is hoping to market it as a security auditing tool, although it appears to be fundamentally an exploit kit in the same vein as Eleonore and other exploit packs, toolkits designed to be stitched into a Web site and probe visitor PCs for security holes that can be used to surreptitiously install malicious software.

ISPs Don’t Have To Block The Pirate Bay, Court Rules

Two ISPs have won their court battle against an anti-piracy group which had demanded that they block subscriber access to The Pirate Bay. Yesterday a judge at the Antwerp Commercial Court rejected the blocking demands and labeled them “disproportionate”. The Belgian Anti-Piracy Federation has reacted angrily, accusing the ISPs of siding with The Pirate Bay.

Faced with a huge BitTorrent site that simply refuses to comply, give in, or die, anti-piracy groups have been trying other methods to take The Pirate Bay offline.

With 2009′s “guilty” verdict in hand, a common theme in recent times has been to put pressure on ISPs to block the site, but most are refusing to comply.

Similar negotiations have been going on in Belgium between two ISPs, Belgacom and Telenet, and the Belgian Anti-Piracy Foundation (BAF) for some time now, but reached deadlock.

“There should be an efficient and quick procedure to be able to act fast against illegal foreign sites. We’ve tried negotiating with the internet providers for over a year, but to no avail,” said BAF’s Christophe Van Mechelen. “A list of illegal foreign sites was also sent to the public prosecutor’s office, but was classified without result.”

Inevitably the negotiations with the ISPs transformed into legal action and this week a court was left with a decision – should it officially order the service providers to block the world’s most resilient BitTorrent site?

For the Belgian Anti-Piracy Foundation (BAF) the outcome was bad news.

Yesterday the Antwerp Commercial Court refused to order ISPs Belgacom and Telenet to make the The Pirate Bay inaccessible to their subscribers and labeled such a blocking requirement as “disproportionate”.

BAF reacted angrily against the ISPs, stating that by taking the side of The Pirate Bay they had effectively given protection to “an illegal site”. The ISPs, however, said that the decision to block websites is not theirs to make.

“It is not the role of Telenet to decide which sites should be available or not to our users,” said a spokeswoman for the ISP. “As a service provider, this is not within our competence.”

Belgacom also defended its stance in a comment. “The judge considered that immediate action to block this site was not necessary and that BAF’s application was disproportionate to the offense, especially since the site has existed for several years and that the request comes only now.”

District Court Ruling Approves Comcast Peer-to-Peer Settlement; 60 Days Left to File Claims According to Lexington Law Group
Press release

Judge Legrome Davis of the U.S. District Court for the Eastern District of Pennsylvania has given final approval to a class-action settlement involving Comcast's "throttling" of Internet service, bringing the suit to its final stage. Customers whose service was affected have until August 29 to file claims in order to receive their portion of the settlement.

In 2007, Comcast began "throttling" service to its customers who were using certain peer-to-peer (P2P) file-sharing services, resulting in slowdowns and interruptions for as many as 1 million customers. The company eventually admitted that they were in fact slowing and even blocking some P2P sessions.

Jon Hart, a Comcast customer in California, filed a class-action lawsuit against the company. This latest ruling in Hart v. Comcast paves the way for payment of claims without the need for a lengthy trial. "Whatever the outcome after trial," the judge wrote in his ruling, "litigation likely would continue for months if not years through post-trial motions and appeal." That prospect has now been avoided. As Judge Davis noted, "this settlement would make the Hart action the first – and to date the only – P2P action to recover so much as a penny from anyone for anyone."

According to the terms of the settlement, Comcast is required to pay up to $16 million to customers who were affected by the throttling. Comcast subscribers who were affected by Comcast's throttling now have until August 29, 2010 to file a claim on the settlement administrator's web site (p2pcongestionsettlement.com).

"The settlement is a great result for Comcast's customers," said Mark Todzo, an attorney with Lexington Law Group, the public interest law firm representing Hart in the suit. "But customers will only get their share of the $16 million if they file a claim."

In early discussions about the settlement, some misinformation could be seen in comment threads on technology sites; for instance, some commenters alleged that by filing claims, customers were admitting to downloading pirated material. "That's absolutely false," says Todzo. "Millions of people use P2P protocols for legitimate, legal purposes, and when you file a claim in this case, all you're saying is that you used these protocols and believe your service may have been slowed down."

Any current or former Comcast customer who used the Ares, BitTorrent, eDonkey, FastTrack or Gnutella P2P protocols any time from April 1, 2006 to December 31, 2008 and was unable to share files, or believes that the speed at which files were shared was affected, is eligible to file a claim. Customers who were unable to use Lotus Notes to send emails any time from March 26, 2007 to October 3, 2007 are also eligible.

Mediation in Thomas-Rasset Case Fails, RIAA Hit with Bill
Nate Anderson

Minnesota's top federal judge, Michael Davis, certainly seems like a man who just wants the (in)famous Jammie Thomas-Rasset peer-to-peer file-sharing case on his docket to just go away. And the recording industry, which has prosecuted Thomas-Rasset through one name change, two trials, and three years, appears to be under the distinct impression that it's getting picked on.

Thomas-Rasset was the first P2P user in the US to take her copyright infringement case all the way to a federal trial, where she was found liable for $222,000 in damages. After the trial ended, Judge Davis tossed the verdict and granted Thomas-Rasset a new trial on the grounds that one of his jury instructions was flawed.

That second trial again found Thomas-Rasset liable, and jurors upped the damages to a shocking $1.92 million for the 24 songs at issue in the case. This time, Davis ruled the amount "monstrous" and slashed it to $54,000. The RIAA could take that amount or it could choose a third trial, limited to the issue of damages.

It chose a third trial. But instead of letting the case play out, Davis in June 2010 ordered the parties to meet with a Minneapolis arbiter to hash out their differences.
This has all happened before

This would not necessarily be unusual—federal judges demand settlement talks all the time—except for the fact that Davis had already tried the same tactic several times. Both sides had failed to settle before going to trial. In the run-up to the first trial in 2007, Davis ordered them to try again, though he later rescinded that order.

Before the second trial, Davis demanded another settlement conference; after a half day of mediated talks in 2009, this broke down.

After the second trial, the parties again talked voluntarily and could reach no agreement. According to a both sides, they were "stymied by their substantially divergent views on the law and on this case."

So when Davis ordered both sides into mediation again last month, lawyers on both sides must have practiced their eye-rolling skills. What was the point? But Davis also noted something specific and unusual in his June 18 order: the arbiter would be paid $400 per hour, and "the fees incurred for the settlement proceedings shall be paid by Plaintiff." That is, by the recording labels.

Um, remember us? We won. Twice.

Predictably, the talks broke down. In a joint motion filed with the court Monday, both sides agree that nothing will be gained by proceeding further with the mediation, and both were irritated at having to go through the process. "The appointment of the Special Master for settlement purposes can only be done with the consent of the parties and after the parties have been provided notice and an opportunity to be heard," they tell the judge. "In this instance, the parties neither consented nor were provided an opportunity to be heard."

But the recording industry was even more upset by the issue of payment.

The Plaintiffs, on their own, also object to that portion of the June 18, 2010 Order that obligates them to pay the Special Master’s fees. Plaintiffs brought this case alleging that they were the victims of Defendant’s copyright infringement. Twice, Plaintiffs have obtained verdicts by juries that Defendant willfully infringed their rights. Twice, the Court has set aside those verdicts and the case is now set for a retrial on the question of damages alone. The Defendant is an adjudged, willful infringer of Plaintiffs’ copyrights and, while Plaintiffs strongly subscribe to the Court’s desire to settle this case, Plaintiffs believe that the financial burdens associated with the appointment of a Special Master for purposes of pursuing a Special Master should not be placed upon them. The perception that Plaintiffs have greater resources to shoulder those financial burdens should not automatically dictate that they should bear those costs, especially given that they are the prevailing parties. Indeed, pursuant to 17 U.S.C. § 505, Plaintiffs have the right to obtain costs from Defendant, including any costs associated with a Special Master. As such, Plaintiffs do not believe that they should bear the burden of compensating a Special Master.
Judge Davis certainly isn't on Thomas-Rasset's "side" here; indeed, when slashing the second trial award, he trashed Thomas-Rasset for the moment when she "lied on the witness stand by denying responsibility for her infringing acts and, instead, blamed others, including her children, for her actions."

But he certainly doesn't intend to let a huge damage award escape his courtroom. When reducing the $1.92 million award to $54,000, Davis arrived at this amount by awarding triple the $750 minimum for statutory damages. This amount is still "significant and harsh," he noted, but it's a "higher award than the Court might have chosen to impose in its sole discretion."

After multiple settlement talks, two trials, and two judicial decisions to set the verdicts aside, Judge Davis still hasn't rid himself of the troublesome case. Come October 4, 2010, Jammie Thomas-Rasset and the RIAA lawyers will again appear in his 15th floor Minneapolis courtroom for a third trial on damages.

$675,000 Verdict Reduced to $67,500 in SONY v Tenenbaum

In SONY BMG Music Entertainment v. Tenenbaum, the Court has reduced the jury's award from $675,000, or $22,500 per infringed work, to $67,500, or $2,250 per infringed work, on due process grounds, holding that the jury's award was unconstitutionally excessive.

In a 64-page decision, District Judge Nancy Gertner ruled that:

-to decide the issue on common law remittitur grounds would not have avoided the constitutional question, since plaintiffs had indicated they would not accept a "remitted" award, but would instead proceed to a second trial in the event of remittitur;
-the award of $22,250 per infringed work could not withstand scrutiny under the Due Process Clause and was unconstitutionally excessive;
-$2,250 per infringed work was the maximum amount that the Constitution would permit given the facts of this case;
-the Gore, Campbell, and Williams line of cases was applicable to determining the constitutionality of statutory damages awards
-statutory damages must bear a reasonable relationship to the actual damages
-the actual damages sustained by plaintiffs was no more than $30
-the benefit to the defendant was in the neighborhood of $1500
-it was permissible to treble the minimum statutory damages due to defendant's wilfulness


Educational Institutions Tackle Piracy Albeit Reluctantly
Mini Swamy

Five years ago, the Recording Industry Association of America launched a massive drive against piracy. Commercial providers and students, who were the main culprits, were fined for downloading copyrighted works without permission. Even civil action was brought against university students.

According to an Associated Press (News - Alert) report, with the entertainment industry clamoring and campaigning to stamp out unauthorized distribution of copy music, movies and TV shows, the Higher Education Opportunity Act of 2008 has roped in schools to campaign alongside the industry.

Colleges and universities don't seem to have any other option but to the line and try to combat the illegal swapping of pirated movies, or music over their computer networks, without hampering education or research. The penalty for failing to put a halt to piracy is stiff, for it will see institutions lose federal funding, something that they can ill afford to do.

Peer-to-peer file sharing will no longer be possible on a few campuses, as college and university officials are adopting restrictive policies. Initially worried that they would be asked to monitor or block content, there is a provision that offers a great deal of flexibility, so long as they agree to use at least one "technology-based deterrent."

What this would entail is limiting the bandwidth consumed in peer-to-peer networking, monitoring traffic, using a commercial product to reduce or block illegal file sharing and respond to copyright infringement notices from copyright holders.

“Almost all campuses already manage bandwidth or vigorously process infringement, or "takedown," notices,” Steven Worona, director of policy and networking programs for Educause, a higher education tech advocacy group, said.

However, Worona expressed doubt as to whether the investment of time and money would actually succeed in making a dent in digital piracy.

"If the university is going to prohibit underage drinking, I think it ought to prohibit anything on the Internet that's illegal, too," Alicia Richardson (News - Alert), an Illinois State University junior, who applauded her school's restrictive policies on file-sharing.

Richardson also added that schools must educate their campus communities on the issue and offer legal alternatives to downloading "to the extent practicable.

Although the recording industry has stopped suing illegal file-sharers, it still sends infringement notices to colleges, as every fall, a new cadre of students arrive on the campus, and begin the infringing activity all over again.

Since October 2008, the Recording Industry Association of America said it has sent 1.8 million infringement notices to commercial Internet service providers, and 269,609 to colleges and universities. Of course college officials said that these figures didn't really indicate the actual level of illegal activity.

RIAA president Cary Sherman said regardless of the fact of whether campus programs actually put a dent in piracy, or no, the threat of a gradually tougher response to repeat violations was working.

Sherman cited UCLA 's system that notified users by e-mail, whenever the school received an infringement notice, quarantining the computer's Internet access, and not allowing the student to participate in an educational workshop. Repeat offenders faced a one-semester suspension.

The Motion Picture Association of America, which also pressed for the legislation was impressed by the action on the part of college and school campuses, but the question of whether it would actually curb piracy still remained unanswered.

Campuses in Illinois allowed exceptions for students who used technology to tap open-source software, Linux, and for those who sought downloads, the school developed a Web page with links to download free movies and also free music streaming websites such as Hulu and Pandora (News - Alert).

Jack Bernard, a university lawyer who devised a software program, which Michigan offers free to other schools, saw the University of Michigan take a different approach, launching a campus initiative called "BAYU," which stands for "Be Aware (News - Alert) You're Uploading." The result was that whenever files were uploaded or shared, users of the university networks were automatically notified, regardless of whether the activity was legal or not. As a result, the number of copyright infringement notices the university received has slowed to a trickle.

"We think scare tactics and most technological means don't realize the ends we want because technological means never seem to keep up with people's ability to thwart them," Bernard said.

Joe Fleischer, CMO for tracking firm BigChampagne Media Measurement, said that new technologies have made it more difficult to assess how much enforcement has affected piracy. He added that the battle now was much more complicated than five years ago, as file-hosting services and other new modes of infringement were emerging.

The silent battle between the entertainment industry and educational authorities continues, with neither emerging as a clear victor.

Edited by Juliana Kenny

BT and TalkTalk Challenge Digital Economy Act

BT and TalkTalk are seeking a judicial review of the controversial Digital Economy Act, BBC News has learned.

The two internet service providers want the High Court to clarify the legality of the act before it is implemented.

The act was "rushed through" parliament before the general election, they say.

Both think it had "insufficient scrutiny" and question whether its proposals to curb illegal file-sharing harm "basic rights and freedoms".

The act became law shortly before parliament was dissolved in the so-called wash-up period.

It meant it was subject to a shorter debate than other acts. MPs from all parties, including deputy prime minister Nick Clegg, protested at the time that the complex bill should have been debated for longer.

Among its most controversial measures were proposals to disconnect persistent illegal file-sharers from the web and give copyright holders the power to block access to websites hosting illegal content.

Regulator Ofcom, charged with drawing up detailed plans of how the legislation will work, has recently said that plans to remove peoples' internet connections would not come into force until at least 2012.

A caveat added to the act at the last minute stipulates that new legislation and several rounds of consultation would be required before such measures are implemented.

In May Ofcom drew up the policy to deal with illegal file-sharers. It requires ISPs to send warning letters to customers who illegally download films, music and TV programs.

Persistent pirates will be put on a blacklist and their details can be passed to relevant copyright owners to pursue the case through the courts should they wish to.

The code of practice currently only applies to larger ISPs with more than 400,000 subscribers.

Department of Business, Innovation and Skills

This puts BT, TalkTalk and the other large ISPs at a business disadvantage, said Andrew Heaney, executive director of TalkTalk.

"It means we could have huge swathes of customers moving to smaller ISPs to avoid detection."

In particular TalkTalk and BT are seeking clarity as to whether the act conflicts with EU legislation.

It could conflict with Europe's e-commerce directive which states that ISPs are "mere conduits" of content and should not be held responsible for the traffic on their networks.

It may also be in contravention of the privacy and electronic communications directive, said Mr Heaney.

The BPI, which represents the UK's recorded music industry, has lobbied hard for the Digital Economy Act and has taken legal action against file-sharers in the past.

Right to repeal

"It is outrageous that they are coming begging at our door but are not helping themselves," said Mr Heaney.

Critics believe the music industry is seeking to protect its old business models with legislation, rather than finding new ways to distribute music online.

The current government has the right to repeal any previous legislation and, during the election campaign, deputy prime minister Nick Clegg said that the Digital Economy Act "badly needs to be repealed".

But the coalition government told the BBC it had no plans to change it.

"The Digital Economy Act sets out to protect our creative economy from the continued threat of online copyright infringement, which industry estimates costs the creative industries, including creators, £400m per year," read a statement from the Department of Business, Innovation and Skills.

"We believe measures are consistent with EU legislation and that there are enough safeguards in place to protect the rights of consumers and ISPs and will continue to work on implementing them."

US Could Learn from Brazilian Penalty for Hindering Fair Use
Nate Anderson

Brazil has proposed a broad update to its copyright law (Portuguese) and it contains a surprising idea: penalize anyone who "hinders or impedes" fair use rights or obstructs the use of work that has already fallen into the public domain.

A huge win for consumers? Sure, but it gets better. A moment's thought reminds us that most DRM schemes will eventually run afoul the above provisions, since they apply in perpetuity. That DRMed music file will still be DRMed even after the song has fallen into the public domain.

So Brazil wants to ensure that DRM "has time-limited effects that correspond to the period of the economic rights over the work, performance, phonogram or broadcast." Once copyright has expired, DRM should, too.

As if that's not enough, Brazil says that DRM can be bypassed in order to make any "fair" use of the work or in cases where the copyright has expired but the DRM has not.

Contrast this with the US approach to copyright in the Digital Millennium Copyright Act (DMCA), which said nothing about time-limited DRM and made circumvention illegal in nearly all cases, even when the intended use of the material would be legal.

Brazil's proposal could be spun as something hostile to rightsholders, but it's not that simple. The law does provide protection for DRM; in general, it is illegal to remove, modify, bypass, or impair such anti-copying technology. It's just that rightsholders can't use DRM as a digital lock to give themselves more control over a work through technology than they have under the law.


While some content industry lobbyists like to make arguments about "living up to international norms" on DRM to suggest that countries need to take a hard line on anticircumvention, the "international norms" allow plenty of leeway. The WIPO Internet Treaties, one of the key parts of this international consensus, require signatories to "provide adequate legal protection and effective legal remedies against the circumvention of effective technological measures that are used by authors in connection with the exercise of their rights under this Treaty or the Berne Convention and that restrict acts, in respect of their works, which are not authorized by the authors concerned or permitted by law."

DRM must be defended only when it restricts acts that are "not permitted by law." Since the law in places like Brazil, the US, and many other countries contains fair use or fair dealing provisions, those countries are authorized to allow DRM circumvention for those uses as long as general bypassing is disallowed.

Given the nature of most fair use laws, plenty of murky cases will have to be examined by the courts. That's a slow, messy solution, but one that allows for flexibility and creativity; the "clean" alternative of simply outlawing DRM circumvention almost completely leads to the absurd situation where A US citizen can legally rip a CD to an iPod but breaks the law when doing the same with a DVD.

Michael Geist, a Canadian law professor who highlighted the new proposal, sums it up as a properly balanced approach that doesn't buy into the "more is better" approach to copyright protections. "In other words, the Brazilian proposals recognizes what the Supreme Court of Canada stated several years ago," he writes, "over-protection is just as harmful as under-protection."

At Sun Valley, Brighter Moods May Not Mean Big Deals
Paul Thomasch

As Rupert Murdoch, Bob Iger and other media honchos assemble in Sun Valley next week for some fly-fishing or white water rafting, spirits should be brighter than a year ago: stock prices are up by about a third, after all.

That alone provides the currency and freedom to get down to the real business of the media summit, one that boutique investment bank Allen & Co annually hosts in the shadow of the Pioneer Mountains in Idaho. For the past 27 years, the Sun Valley Lodge has been the spot where blockbuster media deals have been hatched.

Even in 2009, when advertising revenues nosedived, Comcast Corp's co-founder Ralph Roberts had the moxie to talk to General Electric Co Chief Executive Jeff Immelt about a deal for NBC Universal.

This year, it could be Walt Disney Co CEO Iger who finds himself center stage amid speculation he may shop ABC -- something Disney has denied. Or veteran dealer Barry Diller from IAC/InterActiveCorp, who has said he would look at a deal involving his Ask.com search engine.

New media hotshots like Facebook, LinkedIn, and Zynga -- on nearly everyone's wish list -- are also expected to attend. As are Google Inc, Time Warner Inc, News Corp, all flush with cash.

"You would think this is going to be a pretty exciting Allen event," said Mike Vorhaus, managing director of consulting firm Frank N. Magid Associates. "Fundamentally, the people at that place, every single one of them, is worth 30 percent or 40 percent more than they were a year ago."

Still, once they step off their private jets and settle in fireside, media chiefs may not be much in the mood for dealmaking, given jittery financial markets and fears the U.S. is heading into a double-dip recession.

Jonathan Knee, a media banker at Evercore Partners Inc, said most executives remain "gun-shy" and any dealmaking would likely involve cable channels or modest new media plays, rather than the blockbuster takeovers.

"The brief euphoria of the beginning of the year has been tempered dramatically both by the recent volatility in the economy and even the quarterly results," said Knee.

"People are glad it's not the bloodbath they thought it might be last year, but I don't think that any believes they have permanently dodged a bullet."

Where Is Jobs?

Among the concerns that could unnerve CEOs is consumer confidence, fragile European economies and, closer to home, a shift in media power from companies that produce entertainment, such as CBS Corp, to those that deliver it, such as Time Warner Cable or Apple Inc.

As head of Apple, Steve Jobs has become perhaps the most commanding and recognizable figure in media today. Jobs is on the guest list for the Sun Valley conference, but it's not clear if he will show up.

Present or not, Jobs will no doubt feature prominently in discussions about new media business models in the digital age, especially in the wake of the successful iPad launch. Apple has already sold more than 3 million of the multimedia tablets, even though it has struck relatively few content deals with the entertainment companies.

Paul Levinson, an author and professor of media studies at Fordham University, is among those who say that traditional content is no longer king, having given way to hot devices and popular digital media.

"Ultimately, what moves the industry forward is the new media and devices and the public's love of them," he said. "Remember, live theater was once the main entertainment."

Others point out that critics have talked about traditional media companies turning into dinosaurs for years. But they have repeatedly shown their staying power -- as evidenced by the attention they draw each summer at Sun Valley.

That is not to say that old school media chiefs won't be harboring new media dreams during cocktail hour at the lodge.

"They are all still looking, and they are all still hoping, and you will still see dabbling," said Evercore's Knee. "But if it is a halfway decent business they are unlikely to be the high bidder and if it's a really large business they risk extraordinary shareholder wrath."

(Reporting by Paul Thomasch; Editing by Derek Caney)

Google Says China has Renewed Web Page License
Melanie Lee

Google Inc said on Friday that the Chinese authorities had renewed its license to operate a website, averting a potential shutdown of its flagship search page in the world's biggest Internet market.

Google said last week that it would stop automatically rerouting users to its uncensored Hong Kong-based search page, explaining that Beijing had indicated it would not renew its Internet Content Provider (ICP) license if it continued to do so.

That had prompted speculation that China might use the opportunity to shut down Google's China search page, which would have been a blow to its other business in the country.

"China has renewed our license," a Google spokeswoman told Reuters. "We are very pleased that the government has renewed our ICP license and we look forward to continuing to provide web search and local products to our users in China."

Google Chief Executive Eric Schmidt had told an industry gathering on Thursday in the United States that he was confident the company would secure the license.

Analysts said that the company's decision to stop automatically rerouting users to its Hong Kong search page showed a willingness to compromise to maintain a foothold in China, the world's largest Internet market by users.

"In China, it is very common that you need to give the government face if you want to do business here. The double click rule (so as not to automatically reroute searches) shows that Google can compromise and give them face," said Edward Yu of Analysys International.

Google stunned markets and consumers in January when it warned it might quit the country, saying it would not provide the censored search results that China requires.

In March, Google began to redirect visitors to its China website to a search site in Hong Kong that provided uncensored results.

The company's row with the Chinese government over Internet censorship and hacking attacks added to a burst of tensions between Washington and Beijing, which also saw diplomatic spats over China's currency, U.S. arms sales to Taiwan and Tibet.

But tensions have subsided in recent months. On Thursday the Obama administration declined to label China a currency manipulator, and a decision to allow Google to keep its Chinese website could remove another source of friction.

(Reporting by Melanie Lee; Writing by Jason Subler and Jonathan Thatcher; Editing by Jeremy Laurence)

Filter Delayed for a Year by RC Content Review

Communications Minister Stephen Conroy this morning announced a number of wide-ranging modifications to the Government’s controversial mandatory internet filtering policy, including a delay of at least a year to the project while the state and Federal governments review the Refused Classification category of content which the filter would block.

In addition, major ISPs such as Telstra, Optus and Primus will voluntarily block (at the ISP level) a list of sites which specifically serve child abuse and pornography content, until the mandatory filter is implemented. The list will be compiled and maintained by the Australian Communications and Media Authority.

Conroy’s other additions to the policy this morning include:

* An annual review of content on the ‘blacklist’ of Refused Classification content by an independent expert, appointed in consultation with industry
* “Clear” avenues for appeal of classification decisions
* A policy that all content which is being considered for inclusion on the blacklist on the basis of a public complaint be classified by the existing Classification Board
* A policy that all parties affected by a content block have the ability to have decisions reviewed by the Classification Review Board
* The use of a standardised block page notification, which will allow ISPs to notify users that the content that have requested has been blocked, and how to see a review of the block

“The public needs to have confidence that the URLs on the list, and the process by which they get there, is independent, rigorous, free from interference or influence and enables content and site owners access to appropriate review mechanisms,” said Conroy in a statement.”

“This suite of measures will help the public have confidence that only the content specified by the legislation is being blocked.” The additions to the policy will be incorporated into the filter legislation, which is currently being developed.

Conroy acknowledged that “some sections of the community” had expressed concern about whether the range of material currently included in the RC category correctly reflected current community standards.

“In order to address these concerns, the Government will recommend a review of the RC classification to State and Territory Ministers, be conducted at the earliest opportunity. The review would examine the current scope of the existing RC classification, and whether it adequately reflects community standards,” he added.

Crikey correspondent Bernard Keane first revealed the news on Twitter, appearing to be tweeting from Conroy’s press conference in Melbourne this morning on the matter. He noted that the review of RC content was expected to take a year.

The timing of the introduction of the legislation to support the filter, however, may still be later this year. Conroy said this week that he expected the legislation to be out this year — and likely before December.

Earlier this year Greens Communications spokesperson Scott Ludlam predicted the filter legislation was unlikely to be introduced until after the Federal election, when the balance of power in the Senate could change. But it remains unclear when that election will be.

Leaked Docs Show Motorcyclist Caved to Advertiser Pressure, Fired Editor
Wes Siler

A series of email exchanges published earlier today by MC24.no appear to indicate that Motorcyclist fired Dexter Ford, a contributing editor who had been with the magazine for three decades, after a story he wrote for The New York Times angered the magazine's advertisers.

The emails, which Ford confirmed for us are the real thing, include an apparent assertion by Motorcyclist editor-in-chief Brian Catterson that major helmet makers threatened to withdraw advertising in his magazine due to Ford's New York Times piece. That same email then quotes Catterson as saying, "Iʼm getting serious heat over this, to the tune of threatening my job unless I do something about you." (September 30, 2009 at 4:21 PM)

If true, the emails raise troubling questions about a potentially unethical relationship between advertising dollars and editorial content at the popular magazine, one that stretches beyond mere motorcycle reviews and appears to include reporting on the safety of children's helmets.

You can find the complete leaked email exchange on MC24.no.

First, Some Background

Motorcyclist is the second largest printed motorcycle magazine in the US, claiming a circulation of 229,416 copies a month. The main focus of the magazine is reviewing new motorcycles and other products related to them, products like helmets. Brian Catterson became editor-in-chief in 2006 after spending 20 years working as a motorcycle journalist, including a 12-year stint at Cycle World. In the article announcing his appointment, Motorcyclist is described as, "one of the most reliable monthly bike publications in the industry today."

Ford has long been controversial with major helmet makers, authoring "Blowing the Lid Off," the seminal expose of the flawed Snell M2005 helmet safety standard. In it, he proved through objective scientific testing that helmets made to that standard transmitted more forces to riders' heads than some less expensive helmets made to the DOT standard. Ford's article turned conventional wisdom on its head, proving that certain less-expensive DOT helmets were, according to his testing, capable of transmitting lower forces to a rider's head than the typically more expensive Snell M2005 brain buckets. Both Arai and Shoei, as well as many other helmet makers, sell helmets with the Snell certification.

The article, first published in 2005, was particularly damning for very small Snell helmets, which, at the time, the organization certified using the same weight head forms as larger-sized helmets. Ford's article concluded, "If you are a man, woman or child with a lighter head...the difference in stiffness between a Snell helmet and a DOT or ECE helmet will be relatively huge."

Motorcycle helmets are made from a "crumple zone" of styrofoam in varying densities encased in a deformable shell designed to prevent penetration and spread out the force of impacts. By varying the density and amount of the styrofoam, helmet makers are able to precisely tailor the rate at which the head will decelerate on impact. In retrospect, it seems obvious that a child or smaller person's head would weigh less than an extra large adult head, thereby requiring less dense styrofoam to achieve a similar rate of deceleration, but Snell M2005 didn't acknowledge that disparity, an oversight that resulted in the potential for smaller heads to be subjected to higher forces in crashes. Ford's article provided evidence that, "helmet makers should tailor the stiffness of their helmets to suit the head sizes of the wearers to protect everybody's brain equally."

The Snell Memorial Foundation is a not-for-profit American organization, funded by helmet makers, that evaluates helmet safety and awards helmets that pass its tests with a certificate the foundation says is, "our assurance that a helmet has measured up to the highest standards for protective performance time and again." The certification is voluntary, but many consumers believe a Snell helmet is safer than one without the organization's stamp of approval. Ford's testing indicates that's not necessarily the case.

Snell revised its standard in July 2009. Snell M2010, the new standard, closely follows the recommendations made in "Blowing The Lid Off." Unfortunately, while helmets meeting the new Snell M2010 standard went on sale October 1, 2009, Snell M2005-rated helmets will continue production through March 31, 2012 and can be sold with the Snell M2005 certification sticker indefinitely. While Snell M2010 tests do use graduated head weights and reduce the maximum allowable g's across every size, most of the new M2010 helmets wear an identical external sticker to M2005 helmets; you have to peel back the inner lining and search for a small interior sticker to tell the difference.

This potential for consumer confusion is the gist of an article Ford wrote for The New York Times entitled "Sorting Out Differences in Helmet Standards," which was published on September 25, 2009. In that article, Ford writes that buyers who want to avoid confusion over helmet standards and find a helmet that's been tested to work with an appropriate weight head can, "simply choose a non-Snell-rated helmet."

Neither Arai or Shoei are mentioned by name at any point in the article. Ford has been a Times contributor since 2007; the newspaper has no affiliation with Motorcyclist or its current publisher, Source Interlink.

Dexter Ford's Times Piece and Motorcyclist's Advertising

According to the leaked emails, on September 30, 2009 at 3:25 PM, Ford received an email from Brian Catterson entitled "NY Times article." It read: "FYI that bit is likely to cost us Arai and Shoei advertising--again. The wagons are already circling..."

As the emails on MC24.no have it, Ford responded, in part, by asking for clarification. Saying, in an email dated September 30, 2009 at 4:06 PM, "They are going to pull their ads from Motorcyclist because the New York Times wrote a (completely true and important) story? I made it very clear in every communication with both that I was writing strictly for the NYT on this, and not by or for Motorcyclist. They have already silenced Motorcyclist on this issue. I don't know what else I can do."

The next email in that chain, at 4:21 PM, believed to be from Catterson, reads: "None of that matters to the brass when two of our biggest advertisers are threatening to yank their ads over a story a freelancer wrote for another publication when we're down $2 mil from last year!"

In that same email, Catterson appears to continue with, "I know what you wrote for the NY Times is accurate, but I think you greatly downplayed how significant an improvement the Snell 2010 standard is. In my eyes it 'rights all wrongs,' which should have been the thrust of your story, not just a couple sentences in a piece that focused largely on the dangers of Snell 2005 helmets. I'm getting serious heat over this, to the tune of threatening my job unless I do something about you."

We asked Catterson about that email, to which he said, "As for the last quote about 'two of our biggest advertisers,' I wrote that after one of our publishers told me that was the case, but then changed his tune, saying that only one had expressed their disappointment over Dexter's article in the New York Times and that he was worried they and others might pull their ads. And anyway, those two companies were neither Arai nor Shoei."

Dexter Ford is Fired, But Why?

Catterson sent us the termination letter in which Ford's association with Motorcyclist was formally severed on October 7, 2009. In this letter, there's no mention of advertiser pressure. Instead, there's an accusation that Ford is "a journalist whose personal vendettas have come to preclude objective reporting." Nothing like that assertion appears anywhere in the rest of the leaked emails. The letter goes on to call Ford's article in the Times "controversial", criticizing it for focusing on consumer confusion over praising the revised Snell M2010 standard.

"... I fired Dexter for the reasons detailed in my letter, not because of any pressure from advertisers," Catterson said when asked for clarification. "Some of our advertisers were upset by Dexter's article in the New York Times, but none ever threatened to pull their advertising, as they had done over the original helmet test published in Motorcyclist in 2005. My job was never literally threatened, either, though our publishers made it clear they wanted me to 'fire' Dexter as he had become a bigger liability than an asset--a sentiment I fully shared."

The termination notice alleges that Ford allowed personal vendettas to get in the way of doing his job, providing two examples:

"Your Susan Carpenter column was another example of your personal agenda getting in the way of objective reporting. Your first few drafts were character assassinations fueled by your desire to have her job. I only agreed to publish the final version after you re-wrote it to focus on her poorly researched motorcycle emissions story."

"The recent Snell press conference was the final straw. By all accounts, your behavior was entirely unprofessional, embarrassing Motorcyclist magazine and yourself."

The thing is, the emails in the leak appear to refute those claims.

Let's look at Ford's Susan Carpenter column first. No such article appears to be available online and it's unclear if it was ever published, but there is extensive mention of it in the leaked emails.

Carpenter writes a motorcycle column for The Los Angeles Times entitled "Throttle Jockey." She's one of the only women in the country to write about motorcycles for a major publication and she often expresses views divergent from those of the two-wheeled establishment.

In an email entitled "Smog-Spewing Susan" sent on June 25, 2008 at 5:24 PM, Ford appears to file the Susan Carpenter story, to which Catterson is quoted as responding at 5:41 PM: "Awesome! Sensational! Fabulous even!"

An email dated the day prior (June 24, 2008 at 3:57 PM) quotes Catterson as asking Ford, "Any progress on your Susan assassination piece?"

Ford is quoted as responding at 6:37 PM on the same day, "So I respectfully request to do a first column on this (current) issue, in which I show that she is wrong, and that bikes come out wonderful in the grand green scheme of things. And then do the subsequent torch job on Susan's lame-oid bike reviews, which is already substantially written."

Catterson is then quoted as replying at 7:45 PM, "I see it as Susan doesn't know jack [expletive deleted] about bikes, has proven it again and again, and now that she's done this expose on how monumentally bad motorcycles are for the environment, she's proven she's not one of us so is fair game. I say one column, feed her to the dogs."

This exchange appears to refute the assertion that Ford's work required a re-write or that his "personal agenda" was the motivating factor for the article. Elsewhere in the leaked emails, Catterson is quoted as using phrases like, "I say F her, she's proven she's one of 'them' now!" (June 18, 2008 at 2:38 PM) and, "So as far as I'm concerned, the gloves are off!" (June 13, 2008 at 12:59 PM), when discussing Susan Carpenter.

"Dexter wrote a number of different versions of his Susan Carpenter editorial, the first few of which were character assassinations fueled, I believe, by his desire to have her job," Catterson said when we asked him about the disparity between the emails and the termination letter. "Dexter has written for the Los Angeles Times before, but not about motorcycling, at least that I'm aware of. I refused to publish those, but agreed to publish a later version he rewrote on the heels of her ill-researched piece on motorcycle emissions. Thus my 'feed her to the dogs' comment, which was obviously intended for his eyes only."

Let's move on to the Snell press conference at which Ford allegedly embarrassed himself and the magazine. Looking at the emails, Catterson appears to assign Ford to the conference on April 22, 2009. On June 22, Ford sends an email to Catterson in which he says, in reference to Snell, "I'm studying to ambush the [expletive deleted]. It will be fun."

According to the next email (June 18, 2009 at 9:54 AM), Catterson doesn't appear to have any problem with "ambush[ing] the [expletive deleted]," responding, "So ambush away, then get writing! Again, this is going to be our lead news story..."

If "ambushing [expletive deleted]" equates to embarrassing behavior, then why didn't Catterson put a stop to it ahead of time, as it appears he had the opportunity to do?

Included in the email chain (August 4, 2009 at 10:11 AM) appears to be a follow up from Motorcyclist's western advertising manager, who spoke to Shoei and Helmet House (both heavily invested in Snell-rated helmets) after Ford's news article about the Snell press conference was published. Nowhere in it is any mention of bad behavior; in fact, the email indicates both companies and everyone else the ad manager spoke to appear to be pleased with the story. The opening paragraph of that email reads: "First of all, I'm pleased to report that the Snell 2010 story has been well received. Shoei, Helmet House, and everyone else I have spoken to since the story broke feels that the article was objective and well written."

If Ford had acted offensively in front of advertisers, wouldn't they have mentioned it the next time Motorcyclist's ad sales guy came calling?

We asked Ford to describe his behavior at the press conference. "I behaved at that press conference like any good reporter should: I asked tough questions," he told us. "And when they didn't give me real answers, I refused to let them off the hook until they did."

"Motorcyclist fired me--because Arai and Shoei didn't like a helmet-standards piece I wrote for the New York Times," Ford told us.

Advertiser Pressure and Ford's Motorcyclist Articles

In an email thread dated August 18, 2009, Catterson appears to respond to a further Snell story pitch from Ford by saying (3:53 PM), "[Expletive deleted] it. I'm done with Snell and the controversy. It's a no-win situation." Catterson goes on to elaborate on that point after Ford asserts the story's importance (August 18, 2009 at 5:16 PM): "I know, I know. But Arai is already pissed off that you wrote anything about Snell again, and we can't afford to lose them like we did last time. We only just got them back! And given the state of advertising right now, we can't afford to lose another major advertiser. There's already talk of going back to saddlestitch and dropping below our 100-page minimum book size. And more importantly, I fear for my job! Sorry."

That's the last email thread included in the leak before Catterson appears to approach Ford about the writer's Times piece, that email asserts not only that the newspaper article will cost Motorcyclist advertising at a time when the magazine can't afford to lose it, but also that his own job is threatened unless he "[does] something about [Ford]."

At one point in the leaked emails Catterson appears to put a dollar amount on some of the advertising that's been lost due to Ford's articles. In an email dated January 19, 2008, at 11:33 AM, Catterson is quoted as writing, "Also FYI your last column cost us Arai's and Shoei's ads again--approximately $100K."

What Does All This Mean?

In these leaked emails, the alleged connection between Dexter's helmet articles and lost advertising dollars is documented as far back as March 2007, expressed multiple times throughout the emails, then culminates with the alleged assertion that the September 25, 2009, Times article "is likely to cost [Motorcyclist] Arai and Shoei advertising -- again." (September 30, 2009 at 3:25 PM) A fine point is put on the connection between the will of advertisers and Dexter's termination when Catterson allegedly says it's his job or Ford's.

"Motorcyclist clearly lets their advertisers dictate not just what they run, and the opinions expressed on their products, but also who their writers are," says Ford. "And even what their writers write for real, world-class papers like the New York Times."

"As a professional moto-journalist since 1986, I firmly believe in separation of 'church and state,' and have always told it like it is, never mind the repercussions," Catterson told us.

Throughout the leaked emails Catterson appears to be enthusiastic, even excited about Ford's articles and writing. The tone reflects that right up until August 2009 when assertions like, "I fear for my job!" begin to appear. (August 18, 2009 at 5:16 PM) Catterson actually sounds like a great editor, working hard to ensure his writer has assignments he's enthusiastic about and working with Ford to get the best out of his writing. Sadly, it appears that Catterson could have been placed in the unenviable position, after supporting his writer through previous instances of lost advertising, of choosing between his own job and that of Ford's due to advertiser pressure.

There's no link made in the emails between unethical practices at Motorcyclist and Source Interlink Media (the magazine's publisher) other than Catterson's apparent assertion that "None of that matters to the brass when two of our biggest advertisers are threatening to yank their ads" (September 30, 2009 at 4:21 PM) and the connection that can logically be drawn between the editor-in-chief's job allegedly being threatened and that alleged threat coming from Source Interlink Media staff senior to the editor-in-chief at one of the titles they own. Source Interlink Media also publishes motorcycle titles like Sport Rider, Dirt Rider, ATV Rider, Hot Bike and Super Streetbike, as well as popular titles outside the motorcycle world such as Motor Trend and Automobile Magazine.

Unfortunately, looking at the big picture, these leaked emails have severe implications for Motorcyclist's credibility, suggesting an editorial environment where profit is put before ethical behavior.

Ford asks, "If you were a Motorcyclist staffer, and you understood what happened to me, would you make sure your next road test took full account of who advertises, how much, and how cranky they might be?"

Facebook Makes Headway Around the World
Miguel Helft

Sergey Brin, a Google founder, takes issue with people who say Google has failed to gain a foothold in social networking. Google has had successes, he often says, especially with Orkut, the dominant service in Brazil and India.

Mr. Brin may soon have to revise his answer.

Facebook, the social network service that started in a Harvard dorm room just six years ago, is growing at a dizzying rate around the globe, surging to nearly 500 million users, from 200 million users just 15 months ago.

It is pulling even with Orkut in India, where only a year ago, Orkut was more than twice as large as Facebook. In the last year, Facebook has grown eightfold, to eight million users, in Brazil, where Orkut has 28 million.

In country after country, Facebook is cementing itself as the leader and often displacing other social networks, much as it outflanked MySpace in the United States. In Britain, for example, Facebook made the formerly popular Bebo all but irrelevant, forcing AOL to sell the site at a huge loss two years after it bought it for $850 million. In Germany, Facebook surpassed StudiVZ, which until February was the dominant social network there.

With his typical self-confidence, Mark Zuckerberg, Facebook’s 26-year-old chief executive, recently said it was “almost guaranteed” that the company would reach a billion users.

Though he did not say when it would reach that mark, the prediction was not greeted with the skepticism that had met his previous boasts of fast growth.

“They have been more innovative than any other social network, and they are going to continue to grow,” said Jeremiah Owyang, an analyst with the Altimeter Group. “Facebook wants to be ubiquitous, and they are being successful for now.”

The rapid ascent of Facebook has no company more worried than Google, which sees the social networking giant as a threat on multiple fronts. Much of the activity on Facebook is invisible to Google’s search engine, which makes it less useful over time. What’s more, the billions of links posted by users on Facebook have turned the social network into an important driver of users to sites across the Web. That has been Google’s role.

Google has tried time and again to break into social networking not only with Orkut, but also with user profiles, with an industrywide initiative called OpenSocial, and, most recently, with Buzz, a social network that mixes elements of Facebook and Twitter with Gmail. But none of those initiatives have made a dent in Facebook.

Google is said to be trying again with a secret project for a service called Google Me, according to several reports. Google declined to comment for this article.

Google makes its money from advertising, and even here, Facebook poses a challenge.

“There is nothing more threatening to Google than a company that has 500 million subscribers and knows a lot about them and places targeted advertisements in front of them,” said Todd Dagres, a partner at Spark Capital, a venture firm that has invested in Twitter and other social networking companies. “For every second that people are on Facebook and for every ad that Facebook puts in front of their face, it is one less second they are on Google and one less ad that Google puts in front of their face.”

With nearly two-thirds of all Internet users in the United States signed up on Facebook, the company has focused on international expansion.

Just over two years ago, Facebook was available only in English. Still, nearly half of its users were outside the United States, and its presence was particularly strong in Britain, Australia and other English-speaking countries.

The task of expanding the site overseas fell on Javier Olivan, a 33-year-old Spaniard who joined Facebook three years ago, when the site had 30 million users. Mr. Olivan led an innovative effort by Facebook to have its users translate the site into more than 80 languages. Other Web sites and technology companies, notably Mozilla, the maker of Firefox, had used volunteers to translate their sites or programs.

But with 300,000 words on Facebook’s site — not counting material posted by users — the task was immense. Facebook not only encouraged users to translate parts of the site, but also let other users fine-tune those translations or pick among multiple translations. Nearly 300,000 users participated.

“Nobody had done it at the scale that we were doing it,” Mr. Olivan said.

The effort paid off. Now about 70 percent of Facebook’s users are outside the United States. And while the number of users in the United States doubled in the last year, to 123 million, according to comScore, the number more than tripled in Mexico, to 11 million, and it more than quadrupled in Germany, to 19 million.

With every new translation, Facebook pushed into a new country or region, and its spread often mirrored the ties between nations or the movement of people across borders. After becoming popular in Italy, for example, Facebook spread to the Italian-speaking portions of Switzerland. But in German-speaking areas of Switzerland, adoption of Facebook lagged. When Facebook began to gain momentum in Brazil, the activity was most intense in southern parts of the country that border on neighboring Argentina, where Facebook was already popular.

“It’s a mapping of the real world,” Mr. Olivan said.

Facebook is not popular everywhere. The Web site is largely blocked in China. And with fewer than a million users each in Japan, South Korea and Russia, it lags far behind home-grown social networks in those major markets.

Mr. Olivan, who leads a team of just 12 people, hopes to change that. Facebook recently sent some of its best engineers to a new office in Tokyo, where they are working to fine-tune searches so they work with all three Japanese scripts. In South Korea, as well as in Japan, where users post to their social networks on mobile phones more than on PCs, the company is working with network operators to ensure distribution of its service.

Industry insiders say that, most of all, Facebook is benefiting from a cycle where success breeds more success. In particular, its growing revenue, estimated at $1 billion annually, allows the company to invest in improving its product and keep competitors at bay.

“I think that Facebook is winning for two reasons,” said Bing Gordon, a partner at Kleiner Perkins Caufield & Byers and a board member of Zynga, the maker of popular Facebook games like FarmVille and Mafia Wars. Mr. Gordon said that Facebook had hired some of the best engineers in Silicon Valley, and he said that the company’s strategy to create a platform for other software developers had played a critical role.

“They have opened up a platform, and they have the best apps on that platform,” Mr. Gordon said.

With Facebook’s social networking lead growing, it is not clear whether Google, or any other company, will succeed in derailing its march forward.

Says Danny Sullivan, the editor of Search Engine Land, an industry blog, “Google can’t even get to the first base of social networks, which is people interacting with each other, much less to second or third base, which is people interacting with each other through games and applications.”

Germany & Facebook Aren't Friends
Melissa Eddy

A German data protection official said Wednesday he launched legal proceedings against Facebook, which he accused of illegally accessing and saving personal data of people who don't use the social networking site.

Johannes Caspar said his Hamburg data protection office had initiated legal steps that could result in Facebook being fined tens of thousands of euros for saving private information of individuals who don't use the site and haven't granted it access to their details.

"We consider the saving of data from third parties, in this context, to be against data privacy laws," Caspar said in a statement.

Facebook has until Aug. 11 to respond formally to the legal complaint against it. Its response will determine whether the case goes further.

Germans are protected by some of the world's most strict privacy laws, which lay out in detail how and how much of an individual's private information may be accessed by whom.

Germany also has launched an investigation into Google Inc. over its Street View mapping program.

In April, Facebook changed its privacy settings to allow users to block access to the contacts listed in their e-mail, but Caspar argues that the previously saved contacts have not been erased and are being used for marketing purposes.

"It is a system that is designed around making it possible for Facebook to expand, for its own benefit," Caspar said in a telephone interview.

He said his office had received complaints from "many" people who had been contacted by Facebook after it obtained their names and e-mail addresses through people listing them as a contact.

He could not give a specific number, but said that it indicated third parties' data had been obtained by Facebook had been saved for future use.

"Given that several million people in Germany alone are members, this is a very unsettling notion," he said.

Germany's consumer protection minister, Ilse Aigner, said last month that she plans to give up her Facebook account, arguing that it still wasn't doing enough to protect users' data.

Clay Shirky: 'Paywall Will Underperform – the Numbers Don't Add Up'

The internet guru on the death of newspapers, why paywall will fail and how the internet has brought out our creativity – and generosity
Decca Aitkenhead

If you are reading this article on a printed copy of the Guardian, what you have in your hand will, just 15 years from now, look as archaic as a Western Union telegram does today. In less than 50 years, according to Clay Shirky, it won't exist at all. The reason, he says, is very simple, and very obvious: if you are 25 or younger, you're probably already reading this on your computer screen. "And to put it in one bleak sentence, no medium has ever survived the indifference of 25-year-olds."

You have probably never even heard of Shirky, and until this interview I hadn't either. When I ask him to define what he does, he laughs, and admits that often when he's leaving a party someone will say to him, "What exactly is it you do?" His standard reply – "I work on the theory and practice of social media"– is not just wilfully opaque, but crushingly dreary, which is funny, because he is one of the most illuminating people I've ever met.

The people who know about Shirky call him an "internet guru". He winces when I say so – "Oh, I hate that!" – and it's easy to see why, for he is the very opposite of the techie stereotype. Now 46, his first career was in the theatre in New York, and he didn't even own a computer until the age of 28, when he had to be introduced to the internet by his mother. Arrestingly self-assured and charismatic, his conversation is warm and discursive, intently engaged yet relaxed – but it's his rhetorical fluency which bowls you over. The architecture of his argument is a Malcolm Gladwell-esque structure of psychological and sociological insight, analysing contemporary technology with the clarity of a historian's perspective and such authority that were he to tell you the sun actually sets in the east, you might almost believe him. At the very least, you'd probably want to – and if a guru is defined by the credulous deference he commands from others, then Shirky unquestionably qualifies. Within minutes I found myself hanging on his every word – despite being temperamentally hostile to almost everything he believes.

Shirky has been writing about the internet since 1996. As the chief technological officer for several web design companies during the 90s, he was quickly hired as a consultant by major media companies – News Corporation, Time Warner, Hearst – all curious about this new thing called the world wide web. In 2000, following "an intuition that the internet was turning social", Shirky turned to the fledgling phenomenon of online social networking – an obscure concept back then, but which has since evolved into MySpace, Facebook and Twitter, to become the web's primary purpose for billions of people all over the world. Shirky now teaches new media at New York University, and in 2008 published his first book, Here Comes Everybody: How Change Happens When People Come Together, which celebrated individuals' new power to communicate, organise and change the world via the web.

His predictions for the fate of print media organisations have proved unnervingly accurate; 2009 would be a bloodbath for newspapers, he warned – and so it came to pass. Dozens of American newspapers closed last year, while several others, such as the Christian Science Monitor, moved their entire operation online. The business model of the traditional print newspaper, according to Shirky, is doomed; the monopoly on news it has enjoyed ever since the invention of the printing press has become an industrial dodo. Rupert Murdoch has just begun charging for online access to the Times – and Shirky is confident the experiment will fail.

"Everyone's waiting to see what will happen with the paywall – it's the big question. But I think it will underperform. On a purely financial calculation, I don't think the numbers add up." But then, interestingly, he goes on, "Here's what worries me about the paywall. When we talk about newspapers, we talk about them being critical for informing the public; we never say they're critical for informing their customers. We assume that the value of the news ramifies outwards from the readership to society as a whole. OK, I buy that. But what Murdoch is signing up to do is to prevent that value from escaping. He wants to only inform his customers, he doesn't want his stories to be shared and circulated widely. In fact, his ability to charge for the paywall is going to come down to his ability to lock the public out of the conversation convened by the Times."

This criticism echoes the sentiment of Shirky's new book, Cognitive Surplus; Creativity and Generosity in a Connected Age. The book argues that the popularity of online social media trumps all our old assumptions about the superiority of professional content, and the primacy of financial motivation. It proves, Shirky argues, that people are more creative and generous than we had ever imagined, and would rather use their free time participating in amateur online activities such as Wikipedia – for no financial reward – because they satisfy the primal human urge for creativity and connectedness. Just as the invention of the printing press transformed society, the internet's capacity for "an unlimited amount of zero-cost reproduction of any digital item by anyone who owns a computer" has removed the barrier to universal participation, and revealed that human beings would rather be creating and sharing than passively consuming what a privileged elite think they should watch. Instead of lamenting the silliness of a lot of social online media, we should be thrilled by the spontaneous collective campaigns and social activism also emerging. The potential civic value of all this hitherto untapped energy is nothing less, Shirky concludes, than revolutionary.

Unfortunately, I am precisely the sort of cynic Shirky's new book scorns – a techno-luddite bewildered by the exhibitionism of online social networking (why does anyone feel the need to tweet that they've just had a bath, and might get a kebab later?), troubled by its juvenile vacuity (who joins a Facebook group dedicated to liking toast?), and baffled by the amount of time devoted to posting photos of cats that look amusingly like Hitler. I do, however, recognise that what I like to think of as my opinions are really emotional prejudices. But equally, Shirky's prediction for Murdoch's paywall sounds suspiciously like an emotional objection, rather than a financial calculation. How, then, can he be certain his entire analysis of the internet isn't just as subjective as my kneejerk cynicism?

"I'd say first of all that the notion that any expression of the world can be a value-neutral description of what life is really like is a fantasy, right?" he agrees readily. "We're all postmodern enough to recognise that any writer on any subject is operating within those constraints. And I have the amiably simple-minded view of this stuff you would expect from an American, which is that I think freedom is good, full stop. So therefore I think I'm probably constitutionally incapable of seeing a massive spread in those freedoms as being anything other than salutary for society.

"But ultimately, over the long haul I'm vetted on accuracy, not on enthusiasm. So if I'm wrong about paywall, I've got no place to hide. I will have been flamingly, publicly wrong for 15 years. There will be no way I can weasel out of it." He laughs, looking sublimely untroubled by this possibility.

"The final thing I'd say about optimism is this. If we took the loopiest, most moonbeam-addled Californian utopian internet bullshit, and held it up against the most cynical, realpolitik-inflected scepticism, the Californian bullshit would still be a better predictor of the future. Which is to say that, if in 1994 you'd wanted to understand what our lives would be like right now, you'd still be better off reading a single copy of Wired magazine published in that year than all of the sceptical literature published ever since."

The one point of agreement between internet utopians and sceptics has been their techno-deterministic assumption that the web has fundamentally changed human behaviour. Both sides, Shirky says, are wrong. "Techies were making the syllogism, if you put new technology into an existing situation, and new behaviour happens, then that technology caused the behaviour. But I'm saying if the new technology creates a new behaviour, it's because it was allowing motivations that were previously locked out. These tools we now have allow for new behaviours – but they don't cause them." Had Facebook been around when he was in his 20s, he cheerfully admits, he too would have spent his youth emailing photos of himself to everyone he knew.

But even if he's right, and the internet has merely unveiled ancient truths about human behaviour, isn't it still legitimate to feel a little bit dismayed by Facebook's revelation of almost infinite narcissism? Shirky lets out a polite but weary sigh. "Would the world really be better off if we were to hide from ourselves the fact that teenagers waste a lot of time trying to either flirt with each other or to crack each other up? Like, to whom was this a mystery, prior to the launch of Facebook?" He grins in good-natured amazement.

"Look, we got erotic novels, first crack out of the box, once we had printing presses. It took a century and a half for the Royal Society to start publishing the first scientific journal in English. So even with the sacred printing press, the first things you get serve the basest human urges. But the presence of the erotic novels did not prevent us from pressing the printing presses into the service of the scientific revolution. And so I think every bit of time spent fretting about the fact that people have base desires which they will use this medium to satisfy is a waste of time – because that's been true of every medium ever launched."

Shirky concedes that the web's ability to connect people with a common enthusiasm, however obscure or deviant, can create a dangerously distorted impression of what is healthy or normal. "But so the question in all of this stuff, always, always, always, is: is the net trade-off better or worse for society? I've never been a cyber utopian. I've always understood that this is a set of trade-offs. So for all the normalisation of, say, paedophilia, we also get young small-town kids growing up gay who now know they're not abnormal. And it seems to me that the net trade-off of lessening society's ability to project a sense of normal that no one actually lives up to is a good thing.

"I don't mean to say it will therefore be an endless fountain of raindrop-flavoured kittens from now till St Swithin's day. But rather, in the same way that we've generally decided that the printing press was a good thing – and I would contrast that with television, which in my mind is an open question – rather than just saying in the panglossian way that all new technologies are an improvement, it is an on-the-balance calculation."

The neuroscientist Susan Greenfield produced a report last year which suggested that the popularity of online social media was damaging children's brain development, in particular their capacity for empathy. Shirky has two children, aged nine and six, and says they live in "a very restricted media household", with only supervised access to a communal computer. "I would not hesitate to say I was addicted to the internet in the first two years. It can be addictive and things not taken in moderation have negative effects. But the alarmism around 'Facebook is changing our brains' strikes me as a kind of historical trick. Because we now know from brain science that everything changes our brains. Riding a bicycle changes our brains. Watching TV changes our brains. If there's a screen you need to worry about in your household, it's not the one with a mouse attached."

Shirky does not own a television. Americans watch, collectively, two hundred billion hours of television a year, and if online social media diverts even just a fraction of that time, he argues, that has to be a good thing. "As I say in the book, even the stupidest possible creative act is still a creative act. And I'd still take the most inane collaborative website over someone watching yet another half hour of TV."

By now, despite myself, I'm having to reconsider my old snootiness towards social media. There's just one last thing, I say. Had I never been online before, and had just read his book, I'd probably be so inspired by his account of the creative and collaborative instincts of the online community, I'd be rushing to log on. But if I started out on, say, the Guardian's Comment is free site, the sheer nastiness of many of the commenters would floor me like a train. If the web has unlocked all this human potential for generosity and sharing, how come the people using it are so horrible to each other?

Shirky smiles, confident that he has the answer even to this. "So, there's two things to this paradox. One is that those conversations were always happening. People were saying those nasty things to one another in the pub or whatever. You just couldn't hear them before. So it's a change in our awareness of truth, not a change in the truth.

"Then there's this second effect, that anonymity makes people behave more meanly. What I think is going to happen there is we are slowly going to set up islands of civil discourse. There's no way to make the internet not anonymous – and if there was, the most enthusiastic consumers of that technology would be Iranian and Chinese and Burmese governments. But there are ways of saying, while you're here, use your real identity. We need to set up the social norms which say in this space you need to use your real names, or some well-known handle.

"Whenever you say that, people cry censorship, but frankly? Fuck off." He breaks off, laughing. "You know, getting that right is important. The whole, 'Is the internet a good thing or a bad thing'? We're done with that. It's just a thing. How to maximise its civic value, its public good – that's the really big challenge."

• Cognitive Surplus: Creativity and Generosity in a Connected Age by Clay Shirky is published by Allen Lane, price £20

• This article was amended on 5 July 2010. The original referred to Western Union telegrams looking arcane today. This has been corrected.

Have Downloads Hit A Plateau?

While digital download sales were perceived to be the savior of the music industry in a time of declining CD sales, it looks like even MP3s have leveled off in popularity. Downloads of songs to iPods, computers, and other devices have stalled, according to Nielsen SoundScan, growing just 0.3 percent this year. Furthermore, ringtones, which peaked in 2007 at $714 million, and have since fallen 24 percent, according to the latest data from researcher SNL Kagan. And data from NPD Group shows that the number of music enthusiasts using iTunes, Amazon.com and other digital music stores has leveled off at about 40 million.

"The days when people were building their digital collections or might hear a song and buy digitally are diminishing," NPD analyst Russ Crupnick told Business Week.

On the bright side, Pricewaterhouse-Coopers says that growth in downloads may pick up this year, but it won't be enough to keep the overall industry from shrinking. U.S. sales of recorded music — including CDs, downloads, and other formats — will fall to $7 billion in 2012, more than half their level in 2005, before climbing again slowly, according to Pricewaterhouse-Coopers estimates.

One factor that could be contributing to falling download sales is the higher price. Last year, the major labels persuaded iTunes to raise prices from 99 cents to $1.29 for the newest hits. Warner Music Group conceded in February that the higher price may have contributed to slower growth in downloads last year, though its overall digital revenue grew by 12 percent in the quarter ended in March. Universal Music Group also said that revenue fell by 1.7 percent in the quarter ended March 31, largely due to weak ringtone sales.

Digital Upstarts Still See Potential in Downloads
Ed Christman

Much of the buzz around digital music is focused on Spotify's plans for the United States, Rdio's new subscription service, and what Apple's anticipated cloud-based music service will look like.

But while streaming music services are capturing the most attention, two other entrants in the digital music market are betting there's still opportunity in selling digital downloads.

In May, new digital retailer Immergent.com flipped the switch on its public beta, boasting more than 8 million songs from the four majors and independent labels. On June 8, music startup ScatterTunes.com released its latest round of multimedia "V-Album" releases, including editions of Taylor Swift's "Fearless" and Reba McEntire's "Keep On Loving You." ScatterTunes also runs a download store with 3 million songs from all the majors and leading indies.

Back when HMV opened its first two stores in New York in 1990 or when Amoeba Music expanded beyond the Bay Area to Los Angeles in 2001, the major labels welcomed the moves.

Today, you would think labels would applaud the fact that someone is investing in selling music.

However, label executives have been largely indifferent, probably because so far no one has managed to lay a glove on iTunes. Walmart, the largest retailer in the world, is a digital nonentity: Its download store commands a meager 0.17% share of the U.S. market, according to Billboard estimates. Amazon may be making its presence felt in selling digital album downloads, but it hasn't exactly lit up the scoreboard, so far capturing a market share of 1.4% through its MP3 store.

While the industry had high hopes for both of those digital efforts, Walmart has done zilch in the way of promotion and Amazon's marketing seems limited to selling digital music alongside CDs and loss-leader sale pricing, apparently hoping that customers shopping for other products will stumble into its MP3 store.

Given that disappointing track record, jaded label executives may wonder how Immergent and ScatterTunes intend to succeed where Walmart and Amazon have fallen short.

Immergent is banking on its social networking functions to distinguish itself with music consumers, such as the ability for registered customers to build playlists that others can purchase. Immergent expects to be cash-flow positive in 18 months and break even in two years, according to Immergent founder/CEO John Trickett, the former head of now-dormant 5.1 Entertainment Group, which included the Immergent, Silverline and Myutopia record labels. The company participated in the major-label consortium that developed the DualDisc format.

Meanwhile, ScatterTunes is striving to distinguish itself by aligning with labels and artists to help promote the site through its V-Album format, which, like the iTunes LP, attempts to bring back the album cover experience of old. For consumers who already have a regular digital copy of a V-Album title, the company also sells "V-Wraps" that contain all the multimedia content included in a V-Album, including lyrics, photos and videos. The company is the brainchild of CEO Witt Stewart, whose music background includes artist management (Carole King, Jerry Jeff Walker, Joe Ely) and co-ownership of Freeflow Productions, which developed and produced Christopher Cross' debut album, among other releases.

Unlike Apple, which charges artists and labels to construct an iTunes LP, ScatterTunes builds the V-Wrap around an album for free, and within 48 hours, once the necessary materials are provided, according to ScatterTunes COO Christopher Gentile.

While ScatterTunes prices most albums at $9.99, with V-Albums ranging from $9.99 to $19.99 and V-Wraps, when available, sold separately for $2.99. To help promote the release of the V-Album edition of "Fearless," ScatterTunes has been giving away 100,000 V-Wraps of the album to capitalize on the fact that it had already sold 5.9 million units in the United States, according to Nielsen SoundScan.

ScatterTunes has created 24 V-Albums and expects to build five to 10 V-Albums per month, Gentile says. Acts that have received the V-Album treatment include Jewel, Darius Rucker, Dierks Bentley, Jimi Hendrix, Katy Perry, Saving Abel, John Mayer and Sheryl Crow.

V-Wraps contain links to an artist's website and to other online vendors where customers can purchase merchandise or concert tickets. If the customer leaves the site to buy merch elsewhere, ScatterTunes gets a commission that it splits with labels.

Like iTunes, the ScatterTunes store requires customers to download software to access it. All ScatterTunes downloads are unencrypted, 320 kbps MP3 files and can be imported into iTunes.

"We are not necessarily competing with iTunes but rather being compatible to them with all of the products that we deliver," Gentile says.

Google, Bing Search Engines Turn to Music
Antony Bruno

Internet search engines pride themselves as being neutral providers of information.

But as competition mounts to own the connection between fans and online content, tech behemoths like Microsoft and Google increasingly are turning to their search engines to help drive their entertainment content strategies.

In June, Microsoft launched a new entertainment vertical to its Bing search engine, which among other things aggregates full-track streaming from Zune, details on upcoming tours and buy links within the results for any artist, album or song search.

Google put together a similar package last year and is now building a music download service of its own that would be tied to its search engine and Android mobile operating system.

Given the high volume of entertainment-related queries that the search engines handle, it was only a matter of time before they took bold steps into the space. According to Microsoft, 10 percent of all Internet search queries are entertainment-related, with music lyrics alone accounting for 70 percent of those searches.

With the Bing upgrades, Microsoft is trying to position itself as a better entertainment discovery tool than Google. While both Google and Bing have links to stream full songs found in search results, Bing has the more complete package with additional details on tour dates, lyrics and buy links.

However, all that may change once Google gets its music act together. Sources confirm that later this year Google will launch a music download service that's tied to its search engine. Currently, music searches on Google link to full-song streams provided by MySpace Music, as well as Twitter feeds and other information, which it launched late last year.

Exactly what Google has planned is unclear, but a hint was given during a developers conference for the company's Android mobile platform in May. At the event, Google announced the acquisition of Simplify Media, a content-synching technology that the company demonstrated can be used to automatically synch and stream music purchased online to any Android phone containing the technology.

Whether this is an interim step toward an eventual streaming subscription service is unclear, and Billboard hasn't confirmed any additional details on this point.

Potentially interfering with both plans is an increasingly aggressive effort by the recording industry to have search engines remove links to infringing material. BPI, the trade group representing U.K. record labels, raised the stakes in June by issuing a takedown notice to Google, demanding it remove links to 17 songs from third-party websites it deems infringing, such as RapidShare and MegaUpload. Google hasn't yet responded, but its next steps will be telling.

Should Google comply, it would set a precedent that will almost certainly result in a flood of additional takedown notices from every music label and publisher eager to eliminate pirate links on the world's most popular search engine. If it refuses, there could be another court fight coming as big if not bigger than the $1 billion lawsuit Viacom brought against YouTube -- which itself is heading to appeal after Google recently won a summary judgment to dismiss the case.

As for Bing, Microsoft senior VP of online services Yusuf Mehdi assures the music industry that it will comply with any takedown requests, but has no plans to alter the search algorithm that determines search results.

"We're pretty true to the algorithmic ranking in the Web results," Mehdi says. "We're obviously not going to surface that kind of stuff in the Bing box, but the algorithm that determines relevancy of search results we'll stick with."

While Bing's moves are interesting, it's Google that has the market-moving leverage. According to the most recent data from information services firm Experian Hitwise, Google's search engine in May led the pack with 72 percent U.S. market share, with Yahoo second (14.4 percent) and Bing third (9.2 percent).

But when it comes to music, all of them stand in the shadow of Apple, which still commands 70 percent of digital music download sales in the United States, according to NPD Group. While Apple has no presence in online search (yet), both Microsoft and Google are competing with Apple on the rapidly growing mobile platform -- Google with Android and Microsoft with the new Windows Series 7.

Successfully tying together a cloud-based music service with an online search and discovery system and a path to mobile phones -- not to mention advertising around it all -- is the digital content battlefield of the immediate future.

Why Google's Nascent Plan to Nab Unlicensed Music on YouTube Won't Fly
Erik Sherman

Complaints about copyright infringement on YouTube keep Google (GOOG) busy — just look at the copyright case Viacom (VIA) lost to the company. Aside from video, Google often hears from musicians and labels about people who upload videos using music without permission. Apparently Google has worked on a way to automatically block any unlicensed music use in video uploaded to a site like YouTube. Unfortunately, there are some conceptual flaws that might annoy both some users and rights owners.

Last week, a patent application that Google filed in February became public. The application, a continuation of a patent effort the company has had underway since 2006, is for a way to identify unlicensed audio content and prompt the user to either replace the music with something licensed, permanently mute the audio track, or select licensed music from a collection that YouTube would present.

The problem Google faces is that under the Digital Millennium Copyright Act, copyright owners can force Google to take down infringing videos, whether the whole video was copied without permission or just the soundtrack — read that as music. Dealing with the complaints and the legally mandated back-and-forth with the user who posted the video is time consuming.

Under the idea in the patent application, Google would check each video as its uploaded and create a digital signature. Google’s software would then compare that fingerprint to known music. In case of a match, Google would then offer the switch or ditch option.

Now for the flaws. By comparing the digital signatures, Google assumes that a match means a problem but has no way to automatically know whether someone had a license for the material’s use in a video or claimed a legitimate fair use right to the material. In each case, resolving the question would require first asking the user whether the material was licensed and then either taking the person’s assertion at face value or checking user-provided documentation or the owner company to verify. Fail to ask whether there is permission, and Google runs the risk of criticism over its presumption of guilt.

An automated check also provides a false sense of security. Audio rights are complex, often with a label owning a recording and words and music belonging to someone else. Claim an automated system and you set the expectation among rights owners that there is a way to check any infringement, including an unlicensed new recording of someone’s material.

Sony Remakes Its Music Company Act
Eric Pfanner

At an outdoor theater in Berlin that has played host to U2, R.E.M. and the Rolling Stones, Sony Music Entertainment plans to stage a very different kind of show next month.

Before an expected sellout crowd of 22,000, three men, dressed in red, white and blue jumpsuits, will bound onto stage. But instead of belting out a rock anthem, they will take turns reading from a children’s detective novel in the “Three Investigators” mystery series.

The books have a cult following in Germany and smaller shows in other German cities, feeding on Generation X nostalgia for the series, sold more than 100,000 tickets last autumn. That provides welcome revenue for Sony Music, which, like other music companies, is scrambling to make up for falling compact disc sales. As it does so, it is broadening the definition of a record company, embracing businesses that sometimes have only a tenuous connection to music.

“Three years ago I said, look, we are dying, we have to go into new businesses,” Rolf Schmidt-Holtz, chief executive of Sony Music, said in an interview.

Now he is highlighting the business potential of such initiatives in an effort to quiet internal critics who see Mr. Schmidt-Holtz, who has a background in television and magazines, as insufficiently focused on music.

Company insiders, who did not want to be identified because Sony Corp. does not publish financial information for Sony Music, say that in the current fiscal year, businesses that did not exist when Mr. Schmidt-Holtz took over as chief executive in 2006 are expected to generate more than $300 million in revenue and more than $40 million in profit. That would be about one-tenth of Sony Music’s total revenue and more than one-quarter of its overall earnings.

Some former executives of Sony Music say the push into new areas began well before Mr. Schmidt-Holtz arrived. And Sony Music is not alone among the four major record companies in moving beyond its traditional business of prowling nightclubs to hunt for talent, luring artists into recording studios and producing compact discs. The others — Universal Music Group, Warner Music Group and EMI — are also taking steps in the same direction.

Three years ago, Universal acquired Sanctuary Group, a British music company whose specialties include the merchandising of T-shirts, a business that the major labels had generally outsourced. EMI announced recently the latest in a series of restructurings, saying it was turning itself into a “comprehensive rights management company that can take full advantage of all global opportunities in all markets for music,” though it provided few details of what it had in mind. Record labels also increasingly manage artists’ live tours and other aspects of their careers.

“Because the music industry has gone through such a bad time, if anyone stumbles across areas for new revenue, they will all explore it,” said Simon Dyson, editor of Music & Copyright, a trade publication.

But Sony has perhaps gone further than its rivals in moving beyond its traditional business, in a transformation championed by Mr. Schmidt-Holtz, a relative outsider in the music business. Mr. Schmidt-Holtz, a former editor of the German news magazine Stern who also served as a television executive at the media conglomerate Bertelsmann, took over as chief executive two years after Sony and Bertelsmann combined their music recording businesses in a turbulent merger in 2004.

At the time, the company was troubled by clashes between executives of the former Sony and Bertelsmann sides of the business, which complicated efforts to develop a strategy for the digital age.

Amid a broader cost-cutting, Mr. Schmidt-Holtz pushed aside several prominent executives known for their expertise in the traditional music industry roles of spotting, nurturing and marketing talent, as well as for their free spending.

“We had to change the stretch limo culture that prevailed in many areas of the music industry,” Mr. Schmidt-Holtz said.

The trimming has continued since Sony bought out Bertelsmann’s stake in the joint venture two years ago. Total employment at Sony Music has fallen to fewer than 5,000 from more than 9,000 in 2003. But in addition to scaling back, Mr. Schmidt-Holtz has also urged executives to move into new businesses as opportunities emerge.

Among Sony Music’s nontraditional businesses, the most lucrative, typically generating more than 30 percent of the company’s profit, is a relationship with Simon Cowell, the British entrepreneur behind television talent shows like “The X Factor.” Mr. Cowell’s shows, which have been spun off into dozens of other markets, have given a kick-start to the careers of numerous chart-toppers, including Susan Boyle, the homespun Scot who displayed a powerful singing voice on “Britain’s Got Talent” two years ago.

This year Mr. Cowell and Mr. Schmidt-Holtz renegotiated their partnership and gave Mr. Cowell greater latitude to develop new programs. Some new series under development by the venture, Syco, include game shows and other formats that have little or nothing to do with music, Mr. Schmidt-Holtz said.

“Television formats like these have the power to create enormous value for us around the world,” Mr. Schmidt-Holtz said, because, if they succeed, they can easily be repackaged for other markets.

In other new businesses, Sony is using its knowledge of the music business in some nontraditional ways. Last year, for example, the company signed an agreement with San Luis Province in Argentina, under which Sony acts almost as a consultant, helping the government develop cultural activities in the region.

While Mr. Schmidt-Holtz is enthusiastic about his efforts to diversify the company’s revenue sources, some rivals at other record companies sniff that this is an admission that Sony Music struggles to compete in the core business of signing and promoting musical talent.

Sony’s recording business has actually performed well recently, its share of the worldwide music market rising to 23 percent last year from 21 percent in 2008, according to Music & Copyright. That helped it gain ground against the leader, Universal, which has a 28 percent share, and kept it well ahead of Warner, at 15 percent, and EMI, at 10 percent.

But Sony was helped by some unusual events that may not easily lend themselves to encores, including Ms. Boyle’s surprising arc and a surge in sales of Michael Jackson albums after his death. Three Jackson records, released on Sony’s Epic label, were among the top 10 albums sold worldwide last year, according to the International Federation of the Phonographic Industry.

According to industry speculation, some people within Sony Music would be more comfortable with a hard-core music executive at the helm, rather than Mr. Schmidt-Holtz, especially given that he is a holdover from Bertelsmann at a company now fully controlled by Sony. Mr. Schmidt-Holtz’s contract expires in March, and Sony’s chief executive, Howard Stringer, has given no indication of whether it might be renewed.

Former executives said Mr. Schmidt-Holtz had allowed such speculation to grow because of a hands-off management style.

Were Mr. Schmidt-Holtz to depart, Mr. Stringer might be confronted with a difficult choice among potential successors, with candidates including his own brother, Rob Stringer, who heads Sony Music’s Columbia/Epic division, as well as Barry Weiss, who heads the company’s other main label group, RCA.

Mr. Schmidt-Holtz insisted that Sony had not turned its back on its core business, despite his push to branch out into new areas. Sony, he noted, has had considerable success recently with new acts like Kesha, whose debut album, “Animal,” topped the U.S. charts.

Ralph Simon, a mobile music entrepreneur and co-founder of the Zomba record label group, which is now owned by Sony, said Mr. Schmidt-Holtz’s background could be an advantage in a business searching for new ways to make money.

“In today’s environment in the music industry, it’s a good thing to have someone with TV experience,” Mr. Simon said. “The new music business is a cross-media business, as never before.”

As for Mr. Schmidt-Holtz, he declined to clear up the mystery of how long he might stay at Sony, saying only: “I’m here until I’m not here and I love what I’m doing.”

Pandora Founder Pursues Bigger Piece of Radio Pie
Antony Bruno

During a recent taping of the Comedy Central show "The Colbert Report," host Stephen Colbert took Pandora founder Tim Westergren to task for the name of his Internet radio service.

"Why Pandora?" Colbert asked, reminding him that Pandora's box from Greek mythology released evil into the world. "Is that what the Internet is? You click open the box and evil comes out your speakers?"

"Surprises come out," Westergren responded, "and at the bottom of that box was hope."

To be sure, Pandora is full of surprises and hope. For almost 10 years, Pandora operated on the verge of collapse. In the early years, while it labored to build the Music Genome Project that powers its music recommendation engine, Pandora struggled to find both a business model and funding, to the point where it had to ask employees to work without pay for almost two years.

Then came the infamous March 2007 Copyright Royalty Board (CRB) decision that raised the performance royalty rates for Internet radio to a degree that Westergren said would put Pandora out of business. It led to a two-year fight to reduce those rates, culminating in a compromise reached last July.

Today, Pandora is for the first time on solid footing. It's about to reach the milestone of 60 million registered users and reported its first profitable quarter at the end of last year. At any given time, there are 500 simultaneous targeted advertising campaigns on Pandora, with 45 of the nation's top 50 advertisers spending money on the site. And the company is now expanding into automobiles and TV sets in an effort to turn Internet radio from the redheaded stepchild of the radio industry into a legitimate competitor.

Seeking Radio Dollars

"In the last year, I feel like we've finally cracked the nut on how to effectively monetize a streaming radio service," Westergren says. "Our intention is to build a radio business that looks a lot like the traditional radio business, with a scalable mechanism for selling national and local advertising so we can do everything from big, branded national campaigns to local pizza joint specials. They can be delivered as graphic ads, as audio ads, as video ads. We're pitching big ad agencies who have historically bought broadcast radio and pitching them to shift that money to the Web."

This isn't mere bravado. Westergren, 44, may be the poster boy for the laid-back startup executive, but he's a passionate believer that Pandora will one day change the way the world thinks about radio. His town hall meetings with users nationwide typically draw hundreds of fans whom he quickly charms with his down-to-earth casualness and genuine enthusiasm. Yet as the CRB copyright dispute proved, he's not afraid of a fight. Taking on the terrestrial radio establishment may seem like tilting at windmills, but Westergren's fervor -- which president/CEO Joe Kennedy molds into a business plan -- has helped build a growing team of believers.

Pandora hired 70 of its 190 employees last year and plans to hire another 70 this year, 80 percent to 90 percent of whom will be in ad sales or sales support. Its largest office outside its home base in Oakland, California, is in New York, where a staff of 25 focus exclusively on sales and support, with additional offices in Chicago, Dallas, Los Angeles and other cities. For the first time in the company's history, its ad sales team outnumbers the music analysts that keep the Music Genome Project database up to date.

Revenue VS. Royalties

Despite all this momentum, it's not enough to sustain the kind of growth Westergren hopes to achieve. Pandora raked in $50 million in revenue in 2009, which the company hopes to double by the end of the year. Of that, it paid $30 million in royalties to the music industry as agreed to in the CRB rate settlement with performance rights organization SoundExchange.

That agreement calls for Pandora to pay either a per-stream rate for each song it plays or 25 percent of all revenue, whichever is greater. Pandora needs to generate 8 cents per user per hour to shift the royalty burden to the revenue-share model. Currently, it's bringing in only 2 cents per user per hour.

"Pandora can't survive on network advertising," Westergren says. "The site's too expensive to run because of the licensing. We have to command premium rates."

To do that, Pandora has to rely on more than its sheer numbers, which, while impressive when compared with other digital music services, pale in comparison to traditional radio. Web measurement firm comScore says 13 million unique users interact with Pandora every month, which Westergren says increases to 20 million when taking into account the mobile users that comScore doesn't track. That's only about 1 percent of the audience that traditional radio commands.

Instead, Pandora is relying on its unique position as a source of music discovery. Pandora users enter the name of an artist or song they like, and Pandora's technology builds a custom radio station around that "seed." Users can further fine-tune the stream by voting on each song the service recommends (selecting either "thumbs up" or "thumbs down"). In addition to driving engagement (the company claims users interact with the service seven to eight times per hour) this activity generates user data that can be enormously useful to both artists and advertisers: age, gender, music preference and -- when paired with information compiled during the registration process -- zip code.

Artist Engagement

Pandora's strategy is to work more directly with artists, convincing them to provide exclusive content to the site that Pandora hosts and sells to sponsors at premium rates. The first iteration of this came last year with the Dave Matthews Band, which hosted a listening party on Pandora, sponsored by Brita. Pandora streamed the group's "Big Whiskey and the Groogrux King" album for a week before its release date from a special landing page on Pandora. It also sent a message to all users who either seeded or voted positively for a DMB song, alerting them of the stream.

According to the band's manager, Bruce Flohr at Red Light Management, the promotion resulted in more than half a million streams, with 8,000 linking through to buy the album on iTunes. The band later teamed with Pandora again to drive awareness of its tour, filming interviews with Matthews discussing his green touring initiative. All told, the entire campaign resulted in more than 21 million impressions.

"It was designed to make sure our fans heard the record in an environment where they were getting turned on to music," Flohr says. "It's harder and harder to find things that move the needle in this business. If done correctly, Pandora moves that needle."
More artist managers and label executives have begun to share that point of view. Last December, Pandora posted several video interviews with John Mayer discussing his musical influences, along with a customized playlist of his favorite songs. Pandora brought in AT&T as a sponsor, and the campaign generated 81 million impressions between the two, according to Mick Management founder Michael McDonald.

"There was more exposure from this than any of (Mayer's) other campaigns," he says. "In a world where things are fragmented, it's difficult to find people. So their targeting works. These new models and new ways of reaching people are the ways we're going to survive going forward."

Pandora now has close to 20 similar campaigns either completed, active or in the works for this year, featuring such acts as Jack Johnson, Jewel, Miley Cyrus, Switchfoot, Miranda Lambert, the Walkmen, Mason Jennings and Rogue Wave. The campaigns can include any combination of a prerelease listening party, a series of video interviews or a custom mixtape.

Participating brands, it seems, couldn't be happier. Brita, for example, has since transitioned its involvement with the Dave Matthews Band from Pandora to participating directly as a sponsor of the group's tour.

That's an important shift because at least for now, artists and labels don't make any extra money if they participate in these sponsored campaigns, other than their cut of the CRB royalty payments Pandora makes to SoundExchange.

Leveling The Field

The $30 million in performance royalties paid by Pandora last year represents 60 percent of its revenue. Compare that with satellite radio, which pays 15 percent of royalties for the same content, and terrestrial radio, which pays nothing.

"For the first time, artists are going to get to participate in the radio advertising revenue business," Westergren says. "It's a huge business that has been walled off for musicians."

Westergren has emerged as a vocal supporter of the Performance Royalty Act, which would force terrestrial radio broadcasters to pay performance royalties for the first time. While beneficial for labels and artists, such a requirement would also help put Pandora and traditional radio on more equal footing.

To achieve the kind of scale that Westergren envisions would require expansion to new platforms, particularly to TV and the automobile. Most of Pandora's daily traffic -- about 60 percent -- still comes from computers, according to the company. Of the other 40 percent, the majority comes from mobile phones (3 percent comes through its early forays into Internet-connected TVs).

The biggest potential rests in the car. Pandora has the opportunity to change the way people perceive radio much like DVRs changed the way people view their TV. Once users discover the ability to skip a song they don't like on Pandora while driving, the model could be permanently altered.

Pandora already has a deal with Ford to include the service in cars carrying its Sync entertainment system and has deals to make Pandora-capable after-market car stereos from Pioneer and Alpine.

The Long, Slow Birth of DAB Radio

A push is underway to get listeners to switch from analogue to DAB digital radio, but the technology is almost 30 years old. Why did it take so long to reach the airwaves?

It has been heralded as the medium of future, the means by which we will listen to the Terry Wogans and Chris Moyleses of tomorrow.

Communications minister Ed Vaizey has launched an action plan to get listeners to switch from AM and FM to Digital Audio Broadcasting (DAB) radio, promising that the public will adopt "multi-channel national radio in exactly the same way that television viewers have seen such benefits".

But although the format is not projected to win over a majority of Britons for several years to come, its genesis stretches back further than you may imagine.


* 1981: DAB development begins
* 1985: first DAB demonstration in Geneva
* 1987: Eureka consortium begins developing DAB
* 1993: DAB network of four transmitters set up in the London area
* 1995: BBC's digital radio service launches
* 1999: DAB sets become commercially available in UK
* 2002: BBC launches five national DAB-only services: 6 Music, 1Xtra, BBC 7, Asian Network, and 5 live sports extra

Listeners to drive radio changes

One curious feature of the DAB story is that it was an invention not of the naughties, nor even the nineties - but was first pioneered as far back as 1981.

The technology began development at the Institut für Rundfunktechnik in Munich and throughout the decade was the focus of the Europe-wide Eureka 147 research project.

But the first commercial DAB receivers were not available in the UK until 1999 - begging the question: what took them so long?

The format is, after all, only now beginning to catch on in the UK - more than a decade after its public launch.

Figures from Rajar show that, in March 2010, 24% of all radio listening was digital, compared with 66% on AM or FM radio - a rise of 20% compared with the same period in 2009.

The remainder listen to radio via the internet, digital television and other outlets.

Independent radio analyst Grant Goddard believes that if there had been significant consumer take-up of DAB in the 1990s, it could by now have become the dominant format.

He argues that the fact it was developed by a multitude of European governments and state broadcasters, such as the BBC, via Eureka 147 rather than by the private sector was a crucial factor in delaying its launch.

"If Nokia develop something, they'll be bringing out the handsets before you know it," he says.

"Because DAB was a pan-European development, you had to have agreement from all sides before you could do anything. That meant progress was extremely slow."

But this alone did not account for the hold-up. The sheer complexity of introducing and regulating the system was also a major factor, Mr Goddard adds.


"Each country had to then implement legislation for the spectrum to be used by DAB , because you didn't have a pan-European system," he adds.

"Then, each media regulator had to find ways to licence the spectrum. It was a hugely complicated undertaking."

As a result, Mr Goddard suspects that DAB's time may have passed before it even arrived, with other forms of digital technology - such as broadband - allowing listeners to access radio on their laptops and phones.

But Paul Donovan, radio critic of the Sunday Times and a strong supporter of DAB, believes its tipping point in public popularity cannot be too far off.

He blames a failure of manufacturers and broadcasters to collaborate effectively - the BBC began broadcasting DAB in 1995, he points out, but sets were not commercially available for another four years.

"The initial claims for DAB were exaggerated - for instance, it was said that it could provide CD-quality sound, which it doesn't," he says. "This affected the public's perception.

"But look at the success of 6 Music and BBC 7 - this is clearly something that people want. As coverage extends people more people will buy into it. And it's with car radios that DAB really comes into its own."

DAB advocates say it is on the road that the format's self-tuning properties are best showcased, and the government says it is working with car manufacturers to make digital radios standard in cars by 2013. Additionally, the BBC says it will improve in-car reception by placing more transmitters near major motorway networks as part of a programme to increase UK coverage from 85 to 92%.

The new government, however, has rowed back on its predecessor's target to switch off analogue by the middle of the decade, with Mr Vaizey promising that if people are still listening to, say, the BBC on FM by 2015, then that "will continue".

Whether DAB turns out to be the future, as Paul Donovan expects, or is already part of the past, as Grant Goddard argues, it has already consumed a sizeable chunk of broadcasting history.

Canadian Rockers Arcade Fire Maintain DIY Mystique
David J. Prince

The seven members of Arcade Fire, the Montreal band renowned for its fierce DIY commitment and aversion to the record-industry grind, are gearing up to release their first album in four years next month.

"The Suburbs" comes out on August 2 in the United Kingdom and a day later in Canada and the United States. It marks the follow-up to 2006's "Neon Bible" and their 2004 debut "Funeral," which each sold about half a million copies in the United States, according to Nielsen SoundScan. "Neon Bible" debuted at No. 2 on the Billboard 200.

The band retains a tight grip on its destiny: it owns its own recording studio, master recordings and publishing rights; licenses those rights to different labels across the globe, territory by territory; refuses corporate sponsorships, private-party gigs and most commercial placements; and calls the shots for every major decision.

It's an approach that serves Arcade Fire extremely well, giving it the ability to manage its affairs in a way that embodies the DIY ethos born in the hardcore punk scene of the early '80s while writing anthemic, cathartic songs and performing them to arena audiences.

Now, with "The Suburbs" about to land in cities and suburbs alike, the band's "new DIY" tactics can serve as a road map for artists of all sizes and styles navigating the 21st-century music business.

"They march to the beat of their own drum, and people really respond to that," says C3 Presents promoter/talent buyer Huston Powell, who booked the band for the first Lollapalooza festival in Chicago in 2005 and will see it return as a headliner this summer. "I wish for the whole music industry there were 10 more Arcade Fires out there."

Eight Different Covers

The album will once again come out in North America through North Carolina-based indie label Merge Records, which has a 50/50 profit-sharing deal with the band. It will be released with eight different covers (which will be distributed randomly and not to specific retailers; none will have bonus tracks), with a deluxe version for sale only through the band's website.

Two songs from "The Suburbs" were unveiled on NPR's "All Songs Considered" while brothers and bandmates Win and Will Butler sat for a live chat, fielding questions submitted by fans through Twitter. Another track, "Ready to Start," had its debut on alternative KNDD Seattle, while U.K. DJ Zane Lowe premiered "We Used to Wait."

Before they got married, Win Butler and Regine Chassagne formed Arcade Fire in 2003 in Montreal.

"We were very much a live band," Butler recalls. "It's in our DNA to be a live band -- so when we had a certain amount of local success from being a live band we were able to very slowly fund ('Funeral')."

By March 2005, however, the volume of requests -- for interviews, licensing, show offers and the general day-to-day business of being in a band -- had begun to take more time than rehearsing, touring and actually being in the band. They brought on manager Scott Rodger, Bjork's longtime handler and a member of Paul McCartney's inner circle of advisers.

"What immediately put them into a different league was the fact that they controlled their own rights from day one," Rodger says. "They very cost-effectively made their first album, and then made some strategic deals that would bring in some money for them to buy their own recording studio and be able to be self-sufficient and make their own recordings."

The band also hired booking agent David "Boche" Viecelli, whose Chicago-based company, Billions, had earned a reputation for shrewd bookings and personal artist relationships with bands like Pavement.

After the success of "Funeral," the volume of offers to sign a major-label deal reached a deafening level. Label talent scouts people were dispatched to Montreal with unlimited expense accounts and free rein to offer the band whatever it would take to sign.

"We didn't have any money, so we were like, 'We're not going to sign with you, but if you want to buy us hotel rooms, go for it, we're not going to stop you.' But we were very upfront with their prospects," Butler says. "When anyone said, 'Leave Merge and we'll give you lots of money,' that was never tempting. It got pretty silly at the very end."

Mystery Musicians

One result of the close-knit approach is the members' ability to maintain an air of mystique and secrecy about their personal lives. You're not going to find any of them discussing their daily routines on Twitter. Yet even though they've maintained a wall of privacy, the connection fans feel with them is personal and intense.

"I don't know if I'm old-fashioned, but I feel like the fan relationship involves putting out records," Butler says. "We've always really tried to connect with our audience when we play live -- we don't take it lightly to go onstage and play--it's the DNA of what this band does and we couldn't exist in the same way without that."

This summer, Arcade Fire picks up in the live arena exactly where it left off after taking a two-year hiatus. The world tour for "Neon Bible" began in early 2007 with multinight runs at tiny churches in Montreal, London and New York and ended a year later having notched 122 shows (including 33 festivals) in 75 cities in 15 countries.

Until the three, small June warm-up gigs in Toronto and Montreal, the band's only live appearances since the "Neon Bible" tour ended were four get-out-the-vote gigs for then-candidate Barack Obama's campaign in Ohio and North Carolina, and on inauguration night Arcade Fire shared the stage with Jay-Z at the Obama for America Staff Ball at the Armory in Washington, D.C.

The "Suburbs" tour will find the band playing less frequently and in larger venues. "They know that an Arcade Fire show is a cathartic experience for the band and for the audience," Viecelli says. "The band really is laying it out there emotionally onstage, investing a ton of energy and heart, and they realized that if they do that for too long or too much, they can't maintain that genuine performance level."

Amphitheater shows in Boston, Philadelphia, Nashville, Atlanta and Columbia, Va., comprise most of the U.S. gigs on the books for 2010. In New York, an August 4 show at Madison Square Garden sold out so quickly that a second show was added the next night. More North American shows are in the works for later this year, and in 2011 the band will do some more overseas touring, including Australia, New Zealand and Japan. But Viecelli expects there will be plenty of leftover demand for more Arcade Fire shows.

Restrictive Lollapalooza Contract Draws State Scrutiny
Ray Waddell

Radius clauses, which prevent musicians from playing at competing venues within a specified area and timeframe, have probably been around as long as performance contracts. But the situation in Chicago with Lollapalooza and promoter C3 Presents is drawing new attention to this standard concert business procedure.

Chicago-based blogger Jim DeRogatis was the first to report that Illinois Attorney General Lisa Madigan is investigating C3 because of antitrust concerns relating to radius clauses for artists performing at the annual festival.

Sources confirmed that partners at Austin-based C3, who declined to comment for Billboard, had been subpoenaed in the investigation and were gathering information to present to the AG's office. Also subpoenaed was Marc Geiger, VP at William Morris Endeavor Entertainment, a partner with C3 in Lollapalooza.

Radius clauses for artists based on time and distance are common in performance contracts, not only for headlining one-off concerts, but also with fairs and festivals that invest millions of dollars in talent and production costs and seek to protect the market value of an act or collection of acts in a given market.

Radius clauses for Bonnaroo in Manchester, Tenn., range from 60 to 90 days before and after the event and extend for 250-300 miles. The radius clause for April's Coachella fest was more specific, stipulating that artists "shall not advertise, perform, or publicize any performance: a) In Los Angeles, Orange, Riverside, San Bernardino, Santa Barbara, Ventura, or San Diego counties from December 1, 2009 until 30 days after the Festival; b) At any festival in the States of California, Nevada, or Arizona until 30 days after the Festival; c) Or announce any other U.S. festival prior to February 15, 2010."

Triangle Talent CEO Dave Snowden, who books many of the biggest state fairs in the country, says radius clauses on his events vary. "The widest is the Iowa State Fair, which takes in a 200-mile radius, excluding Davenport," Snowden says. "Most are 100-150 miles."

At six months before the festival and three months after, and extending for 300 miles outside of Chicago, the C3 radius clause for Lollapalooza is indeed a stiff one. Local promoters and venues in Chicago and other cities with major festivals have long complained that restrictive radius clauses cut into the number of acts that other talent buyers can book in the market. Chicago-based promoter Jam Productions didn't respond to a request for comment on the issue.

But a source with knowledge of the Chicago/Lollapalooza situation says that as many as half the bands booked by C3 for Lollapalooza break the radius clause by playing Chicago within the confines of the radius without repercussions from C3, and as many as 90 percent play inside the 300 miles within the specified time frame. One insider says that C3 had, in fact, never enforced the radius clause.

At least one agent confirms that Lollapalooza radius clauses aren't carved in stone. "The Lollapalooza clause is strict on paper, but not more so than those of other festivals of its size," says Tom Windish, president of Chicago-based Windish Agency, which has booked many acts at the fest. "I have found the Lollapalooza organizers to be flexible in addressing specific instances of modifying their exclusivity."

The radius clauses are primarily designed to keep the bigger, expensive acts "clean" in a given market, and such flexibility isn't uncommon, particularly with the smaller acts. In fact, only a handful of acts on any major festival play large venues, so cutting slack on the exclusivity isn't a make-or-break decision.

"I am pretty easy on OK'ing an event if it does not hurt my client," says Snowden, who represents fairs and festivals. "Most of the fairs and other events leave it up to us to OK some of these dates that fall a bit into the radius."

Prince - World Exclusive Interview: Peter Willis Goes Inside the Star's Secret World
Peter Willis

My audience with Prince has taken a bizarre downward turn.

I'm trying to interview the rock legend but he's more interested in an impromptu jam session on the stage of his private concert hall - with me on drums.

We're two minutes into Beatles classic Come Together and I'm getting into my stride when I become aware that Prince is staring across at me and wincing.

"Stop! Stop! Stop!" he shouts, slamming his hand down on his purple grand piano. "Have you ever seen The Apprentice on TV? Cos You're fired!"

I protest. Let's take it from the top again, I suggest. But too late. I've blown it.

Still, there can't be many people who've been hired and fired by Prince, all in the space of a few minutes.

My humiliation came at the end of an extraordinary day in which I was given a rare insight into the very private world of one of the greatest rock stars on the planet. A living legend who has sold more than 100 million albums over 30 years.

Prince agreed to his first British newspaper interview for 10 years before his eagerly anticipated new album 20TEN which, in the biggest music giveaway of the year, will be released free in the UK only in the Daily Mirror this Saturday.

The interview almost doesn't happen. Then it's on as long as I can meet him the very next day at his home town of Minneapolis in the US Midwest (and I'm ordered not to bring a camera, mobile phone or tape recorder).

After a transatlantic dash I arrive at the hotel to find Shelby Johnson, one of Prince's backing singers, waiting to drive me down the road to his Paisley Park base - a name that's as synonymous with Prince as Neverland was with Michael Jackson.

I'd envisaged a lavish purple palace at the end of a winding lane, but it turns out to be a huge white 70,000 square foot building, more like an industrial complex, on a busy main road.

Shelby shows me into a room like a 50s diner and, before I have had chance to sit down, Prince strides in, beaming, with hand outstretched.

I'm amazed. Where is the superstar entourage - burly security, manic PRs and personal assistants?

"Hi," he says, "I'm so glad you could come." His voice is deeper than I expected, he's certainly small (5ft 2in at most), looks almost half his age (52), and is dressed immaculately, if oddly, in white silk trousers, flouncy green silk shirt, an ivory tunic and white pumps (which, I suspect, are stacked).

"You must come and listen to the album," he says. "I hope you like it. It's great that it will be free to readers of your newspaper. I really believe in finding new ways to distribute my music."

He explains that he decided the album will be released in CD format only in the Mirror. There'll be no downloads anywhere in the world because of his ongoing battles against internet abuses.

Unlike most other rock stars, he has banned YouTube and iTunes from using any of his music and has even closed down his own official website.

He says: "The internet's completely over. I don't see why I should give my new music to iTunes or anyone else. They won't pay me an advance for it and then they get angry when they can't get it.

"The internet's like MTV. At one time MTV was hip and suddenly it became outdated. Anyway, all these computers and digital gadgets are no good.

"They just fill your head with numbers and that can't be good for you."

Then he leads me to his recording studio and urges me to sit in his leather swivel chair at the enormous mixing desk. Wow! I've finally arrived at the epicentre of Prince's world - the scene of fabled all-night-long sessions in which he apparently plays up to 27 instruments.

This is where the genius behind classics such as Purple Rain, When Doves Cry, 1999 and Let's Go Crazy creates his music. The walls are a vibrant reddish purple, flickering candles line every ledge and the smell of incense fills the air.

Prince jabs a few buttons and hidden speakers burst into life with my preview. He looks at me searching for a reaction. All fears that it might be uninspiring vanish as my foot starts tapping.

It's instantly infectious. Amazing. Thankfully it's a return to his early blistering form which captivated millions of fans around the world and I love it.

"This one's called Compassion," says Prince. But as I try to scribble it down he looks aghast, grabs my wrist and pleads: "Please, please. It's a surprise, don't spoil it for people."

So why did you decide to call the album 20TEN? I ask. "I just think it's a year that really matters," he says. These are very trying times." To emphasise the point he chivvies me into another room, switches on the TV and shows me clips from an evangelical TV documentary blaming corporate America for a range of woes from Hurricane Katrina to asthmatic children.

He says one problem is that "people, especially young people, don't have enough God in their lives".

Prince has been a devout Jehovah's Witness for more than 10 years.

He even has a space set aside which he's labelled The Knowledge Room, with a library of religious books.

Prince talks about his beliefs with missionary zeal, but ask him anything remotely personal and he's brusque. Question him on his childhood and he says: "I don't talk about the past."

On his relationship with his stunning girlfriend Bria Valente, he says: "Self interest is on the back-burner now."

And on late friend/foe Michael Jackson, he simply replies: "Next question."

Time for another surprise. "Come," he says, and like an excitable Willy Wonka, he leads me down corridors lined with glinting platinum discs to a lounge where his three talented backing singers, Shelby Johnson, Olivia Warfield and Elisa Fiorilla, are waiting by an ebony futuristic grand piano.

Prince shows me to a seat in the middle of the room and starts playing a rousing track Act of God from the new album 20TEN... especially for me.

Surreal isn't the word. I thank them profusely, Prince smiles and sends me off for dinner. But as it's "only" 10pm he suggests we regroup back here in an hour "to party".

As he's gained a reputation as the Prince of Darkness for not starting gigs until 2am and not leaving clubs until dawn, my expectations run high. When I return later to Prince's weird HQ, he welcomes me warmly into what appears to be his own private nightclub.

It's lavishly kitted out with velvet circular sofas, a dancefloor and there's a stairway up to a balcony.

On two huge screens, at least 20ft high, there are videos of him performing.

But where are the guests? And where's the bar? Of course, I remember, he's a strict teetotal vegan - when one of those backing singers wanders in, offering me a glass of still water.

She is closely followed by the other two, carrying trays of sliced melon and raw vegetables, which they place on a long table beside a large Bible. "Help yourself," says one.

Prince walks in with girlfriend Bria, in a shimmering full-length evening gown like she's at the Oscars. Twice married and divorced, he has been with the singer, who's almost half his age, for three years.

He produced her first solo album Elixer last year and she has become a Jehovah's Witness. He introduces her and she looks around and says: "Sorry, I think I'm a little overdressed!"

They pop out for a minute and return, with her proudly holding a food blender filled with a banana smoothie which they pour into glasses for themselves.

Just when it couldn't get any more bizarre, Prince clambers behind video equipment under the stairs and starts screening 1970s clips from the US TV show Soul Train of his music heroes such as Marvin Gaye and Barry White.

He urges his guests - all five of us - to dance and the spirited backing singers look like they're having the time of their lives.

Prince occasionally emerges from under the stairs to study the screens a bit closer. But when I try to talk to him he runs back to his hole, shouting: "Too many questions."

From his agility, it's clear rumours he needs a double hip op after too much dancing on high heels are unfounded. But he bores quickly of the videos and we're off again, down more corridors of platinum discs, past iconic guitars and that famous bike from Purple Rain.

He's decided to take us to his private concert hall, which, with a capacity for more than 1,000 people, is awesome.

Pride of place is a huge Love Symbol #2 - now the name of the symbol he changed his name to when he fell out with his old record company Warners.

He says: "It's what I always dreamed of when I was a young musician, playing in the basement. Music is my life. It's my trade. If I can't get it out of my head I can't function. Someone told me they saw me at my peak, but how do they know when my peak is? I think I'm improving all the time. When I listen to my old records I'm ashamed of how I played then."

He adds earnestly: "Playing electric guitar your whole life does something to you. I'm convinced all that electricity racing through my body made me keep my hair."

Then he orders us all on the stage, saying: "Get yourself an instrument." Prince sits at his purple piano, the backing singers by their microphones and me on the drums. Only to be found out.

It's only midnight but after firing me Prince clearly decides he can take no more. As he bids me farewell, I cheekily pull out a camera and ask for a picture.

He shakes his head. "It's much better in the memory bank," says the star. Then he turns to a backing singer and says: "The picture will make your eyes look red and they will use it really big."

Prince doesn't need an army of PRs to advise him on his image. For all the time I spent with him he still managed to retain that air of mystery.


I have known for a while that there are websites where you can essentially download sheet music for free, and I am certainly aware that a lot of the sheet music being downloaded in that manner was written by me. While my wife Georgia has written extensively about this problem, I have tended to sit back, certain that anything I do would just be the tiniest drop in a very large bucket. But about a month ago, I was seized by the idea to try an experiment.

I signed on to the website that is most offensive to me, got an account, and typed my name into the Search box. I got 4,000 hits. Four thousand copies of my music were being offered for "trade." (I put "trade" in quotes because of course it's not really a trade, since nobody's giving anything up in exchange for what they get. It's just making illegal unauthorized copies, and calling it "trade" legitimizes it in an utterly fraudulent way.) I clicked on the most recent addition, and I sent the user who was offering that music an email. This is what I wrote:

Hey there! Can I get you to stop trading my stuff? It's totally not cool with me. Write me if you have any questions, I'm happy to talk to you about this. jason@jasonrobertbrown.com


Nothing too formal or threatening, just a casual sort of suggestion.

But I wasn't content to do it with just one user. I started systematically going through the pages, and eventually I wrote to about four hundred users.

The broad majority of people I wrote to actually wrote back fairly quickly, apologized sincerely, and then marked their music "Not for trade." I figured that was a pretty good result, but I did find it odd – why list the material at all if you're not going to trade it?

Several other people wrote back, confused about who I was or why I was singling them out, and I would generally write them back, explain the situation, and they too generally would mark their materials "not for trade" or remove them entirely.

But then there were some people who fought back. And I'm now going to reproduce, entirely unexpurgated, the exchange I had with one of them.

Her email comes in to my computer as "Brenna," though as you'll see, she hates being called Brenna; her name is Eleanor. I don't know anything about her other than that, and the fact that she had an account on this website and was using it to trade my music. And I know she is a teenager somewhere in the United States, but I figured that out from context, not from anything she wrote.

On Jun 9, 2010, at 2:38 PM, Brenna wrote:

Sorry. I'm not understanding what you want. I don't think I've ever traded with you before so I don't think I have any of your stuff to trade. If I have and am, however, and if u have a problem with it, I'll of course stop. But please explain to me what I have and how I'm doing something wrong. Thanks! Sorry.

On Jun 9, 2010, at 5:52 PM, Jason Robert Brown wrote:

Hi Brenna:

I'm actually me, Jason Robert Brown, and you're offering several of my songs and scores for "trade" on this website. I'd appreciate it if you wouldn't do that, since it affects my livelihood considerably when people can get free copies of my work from strangers and I don't get anything in return. I'm glad you like my songs and I hope you'll keep playing and singing them, but please don't "trade" them on the Internet, especially with people you don't know.

Many thanks,

On Jun 9, 2010, at 4:36 PM, Brenna wrote:

Let me get this straight. You expect me to believe that you are Jason Robert Brown. THE Jason Robert Brown. And that you have taken the time to go onto random websites and create an account just to message people not to trade your sheet music? I don't mean to be rude, but can you see how I have a bit of trouble believing that?

On Jun 9, 2010, at 7:41 PM, Jason Robert Brown wrote:

Well, I am me – what would anyone else's motivation be for doing this? You're getting an email from my actual email address, I don't know what else would convince you, but I can assure you that I really would like you to stop trading my songs online. Thanks,

On Jun 9, 2010, at 7:43 PM, Brenna wrote:

Quite frankly, there could be a lot of people with motives for doing this. A creeper who thinks he could eventually "prove" that he is who you're claiming to be by getting me to meet with him. Some kid who thinks it's funny to pretend to be a genius composer and get an aspiring actress excited. It's not hard to create an email address with that name in it. I'm just not lucky enough to have someone as famous as Jason Robert Brown email me. It's not something I could easily believe.

On Jun 10, 2010, at 12:03 am, Jason Robert Brown wrote:

Suit yourself, Brenna, but if you can take down my stuff, I'd appreciate it. Thanks.

On Jun 9, 2010, at 9:20 PM, Brenna wrote:

I've taken down your music, but if you're really Jason Robert Brown, I'd like to ask you a question. Why are you doing this? I just searched you on this site and all of the stuff that people have of yours up there say that it's "Not for Trade Per Composer's Request." Did you think about the aspiring actors and actresses who really need some good sheet music? If you're really who you claim to be, then I assume you know that Parade, Last Five Years, 13 The Musical, etc. are all genius pieces of work and that a lot of people who would love to have that sheet music can't afford it. Thus the term "starving artist." Performers really need quick and easy ways to attain good sheet music and you're stopping a lot of people from getting what they need. It matters a great deal to them that they can get it for free. Why does it matter so much to you that they don't?

On Jun 10, 2010, at 12:28 am, Jason Robert Brown wrote:

I'll answer your question, but I'd like your permission to post the exchange on my website. Deal?

On Jun 10, 2010, at 12:31 am, Brenna wrote:

absolutely! that would actually be kind of cool. but if you wouldn't mind changing my name in it to "Eleanor." I'm not sure why my iPod put it as "Brenna" but that's not what I go by and I don't like that name.

All right, now a couple of weeks went by because it takes me a while to get around to writing these blogs and I have a lot of other stuff going on. Then I got an email from Eleanor yesterday.

On Jun 28, 2010, at 4:39 PM, Brenna wrote:

Alright, "Mr. Brown" I have a problem and that problem is your fault. I need the sheet music to "I'd Give It All For You" but thanks to your little stunt, I can't get it. And I cannot just go to the store and buy it. My parents don't support my theatre all that much and they won't buy it for me. And I need it pronto. If you're actually Jason Robert Brown, what can you do to help me with my situation?

On Jun 28, 2010, at 7:43 pm, Jason Robert Brown wrote:

Well, that's a stupid question, Brenna. If you "needed" to go see Wicked tonight, you'd need to pay the $140 to do it or you just wouldn't be able to go. And if you couldn't go, you'd have to go do something else. Likewise, you should pay for things that other people create, or you should content yourself with the free and legal options available to you.

The sheet music costs $3.99, you can download it in one minute, and you're doing the legal and correct thing. That's what I can do to help you:



On Jun 28, 2010, at 5:17 PM, Brenna wrote:

You know, you never actually answered my original question. Why are you doing this?
In order to download something online legally, a credit card is required and I do not have one of those. As I just said, my parents don't support my theatre and wouldn't give me said necessary credit card. Therefore, I cannot buy it. And it is nothing like going to see a show. And you know it. If you are who you say you are, then you're more intelligent than that. You're a genius and your stuff is amazing to perform, but apparently, you're a jerk. We in theatre should support one another and that's not what you're doing.

On Jun 28, 2010, at 8:23 pm, Jason Robert Brown wrote:


How are you supporting me by stealing my song off the Internet? Why are you entitled to get the sheet music for free?


On Jun 28, 2010, at 5:35 PM, Brenna wrote:

Let's say Person A has never heard of "The Great Jason Robert Brown." Let's name Person A "Bill." Let's say I find the sheet music to "Stars and the Moon" online and, since I was able to find that music, I was able to perform that song for a talent show. I slate saying "Hi, I'm Eleanor and I will be performing 'Stars and the Moon' from Songs for a New World by Jason Robert Brown." Bill, having never heard of this composer, doesn't know the song or the show. He listens and decides that he really likes the song. Bill goes home that night and downloads the entire Songs for a New World album off iTunes. He also tells his friend Sally about it and they decide to go and see the show together the next time it comes around. Now, if I hadn't been able to get the sheet music for free, I would have probably done a different song. But, since I was able to get it, how much more money was made? This isn't just a fluke thing. It happens. I've heard songs at talent shows or in theatre final exams and decided to see the show because of the one song. And who knows how they got the music? It may have been the same for them and if they hadn't been able to get it free, they would have done something else.
I answered your question. Do you have any intention of ever answering mine? Don't think I didn't notice that you avoided answering.

On Jun 28, 2010, at 8:42 pm, Jason Robert Brown wrote:

What question of yours did I avoid answering? If the question is "Why am I doing this?", I should think the answer is obvious: I think it's annoying and obnoxious that people think they're entitled to get the sheet music to my songs for free, and I'd like to make those people (you, for example) conscious of the immorality, illegality, and unfairness of their behavior.

And your answer is sophistry, Brenna. That same scenario could take place exactly the same way if you paid for the music. And that's how that scenario is SUPPOSED to take place. You assume that because a good thing comes from an illegal act, it's therefore mitigated. That's nonsense. I'm glad people want to sing my songs, and I'm glad that when other people hear them, they enjoy them – that doesn't mean I surrender my right to get paid for providing the sheet music.


On Jun 28, 2010, at 6:05 PM, Brenna wrote:

First of all, stop calling me "Brenna." I don't think I could possibly have made it clearer that I don't go by that name nor do I like that name. I go by "Eleanor."
Second, I'm not saying that you're not somewhat right in the way you're thinking, but you're also defiantly wrong. Would it be wrong for me to make a copy of some sheet music and give it to a close friend of mine for an audition? Of course not. In fact, it would be considered nasty of me to refuse. But to trade sheet music online is bad? This website is not even technically illegal. Since the music is never actually uploaded onto the site and is sent via email from one user to another, I'm breaking no law by participating in it. You think I don't look this stuff up? I'm careful about what I do online, as you can clearly see from the fact that I'm still iffy on your identity. I know what can happen online. I'm not going to use a website that I think could get me in trouble, just like I'm not going to assume that someone I meet online is who they claim to be.
And third, you think the same scenario could have taken place exactly the same way? Funny. Most of the teenagers I have met who are into theatre would do the free song before they would do the one for $3.99 unless they had a really good reason. It could theoretically take place the same way. The question is would it? And the answer is probably not. I never said that it was an amazing thing happening and I never said that it doesn't start with what I'm sure seems to you as a bad thing. I "assume that because a good thing comes from an illegal act, it's therefore mitigated"? Well, I have just explained that it is not illegal, so we will leave that alone. Yes. I assume that because something that good comes from something so insignificantly negative, it's therefore mitigated.

And so today, I wrote this final chapter:

I'm going to give you three examples to explain why what you're doing is wrong, and then I'm going to stop this exchange, because arguing with teenagers is a zero-sum game, as I've learned from my experience on both ends of the argument. You insist on your right to think you know everything and do whatever you want, and anyone who corrects you or tries to educate you otherwise is the enemy; I don't wish to be the enemy, I'm just a guy trying to make a living.

First story:
Friend of mine is building a house. He drew up the plans, he chopped down all the trees, he's got it all together. He doesn't have a screwdriver. He calls me up, says, "Dude, I need a screwdriver." I happen to have a screwdriver, so I give it to him, but I say, "Hey, I need that back later today, I have some work to do." He looks incredulous. "I have to build a house, my man. I'm not going to be done in a day. And what if someone likes my house and wants me to build one for them? I'll need the screwdriver to build their house too, yo." So I suggest he get his own screwdriver. "Why can't I just use yours?" he says. I tell him he can use mine, but then I need it back, it's my screwdriver, after all. He insists that he has the right to take my screwdriver, build his house, then keep that screwdriver forever so he can build other people's houses with it. This seems unfair to me.

The screwdriver he wants is a tool that he is using to further his own aims. I went out, I bought a screwdriver, now I should just give it away to someone? Now let's say I wrote a song – it took a lot for me to write it, and it has been my full-time job for over twenty years to make sure that the songs I write go out into the world to be heard and sung. The way I support myself and my family is through the sale of those songs, on CD's, in sheet music, in tickets. Sheet music represents almost half of my yearly income. You seem to be saying that you should be able to take that song, that screwdriver, just take it for free, and go build your career and your happiness without ever compensating me.

Second story:
I collect first edition copies of the works of Thornton Wilder. I've been doing so for a long time, he's my favorite author in the world. Friend of mine comes over to the house, sees my collection, and says, "Wow, I've never read any of this stuff. This one looks cool." He takes down "The Bridge of San Luis Rey." "Can I read this?" Sure, I say. It would be rude of me not to let him borrow my book to read, after all. You might even say it would be "nasty." Two months go by; there's a big hole on my bookshelf where "The Bridge of San Luis Rey" is supposed to go. I call my friend, ask him for my book back. He comes over and says, "I love this book, yo. Make me a copy!" I look at him strangely. Why would I do that? He can just go to the bookstore and get a copy of his own. "No, dude, I love THIS book, you should just make me a copy of it." But the publishing company won't be able to survive if people just make copies of the book, I say, and the Thornton Wilder estate certainly deserves its share of the income it earns when people buy the book. He says I'm a jerk because I won't make him a copy of this genius book that I shared with him. I tell him he's a prick and he should get out of my house, and that's the last time I see him for years.

Now, Eleanor, here you might say that that's stupid, it's HARD to make a photocopy of a whole BOOK, but one SONG you can just print out from your computer. And I say to you that just because technology makes doing a bad thing easier doesn't mean it's suddenly not a bad thing. There may soon be technology whereby I can go to my local library and instantly scan and download every single book and put it on my computer for free; then I'll never have to go to the library again, and I'll have all this awesome stuff on my hard drive and it'll be MINE, because I stole it all by myself. The logical endpoint of that argument is fairly obvious to me, and I hope to you: If no one buys any of the books, then the publishing companies will stop printing them, and then the authors will have no way to make their livings as authors. Because I am an author, I tend to believe that I should be able to get paid for doing that work (and it is work, Eleanor, it's really hard work). The way I get paid is that people buy the work that I do, and I get a percentage of that money – other percentages go to the publishers, the bookstores, the theaters, the actors, the typesetters, the copyists, the musicians, the designers, the operators, even the libraries since the government takes a piece and that's how it funds everything you rely on in your everyday life. You think you're entitled to deny all of those people their rightful share of the work they do. I don't understand why you think that.

Third story:
I bought a fantastic new CD by my friend Michael Lowenstern. I then ripped that CD on to my hard drive so I can listen to it on my iPod in my car. Well, that's not FAIR, right? I should have to buy two copies?

No. There is in fact a part of the copyright law that allows exactly this; it's called the doctrine of fair use. If you've purchased or otherwise legally obtained a piece of copyrighted material and you want to make a copy of it for your own use, that's perfectly legal and allowed. Your friend Wikipedia has some useful thoughts about "fair use" and "fair dealing", in case you want to read further. Here's the beginning of the relevant section:

Copyright does not prohibit all copying or replication. In the United States, the fair use doctrine, codified by the Copyright Act of 1976 as 17 U.S.C. § 107, permits some copying and distribution without permission of the copyright holder or payment to same. The statute does not clearly define fair use, but instead gives four non-exclusive factors to consider in a fair use analysis. Those factors are:
the purpose and character of the use;
the nature of the copyrighted work;
the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and
the effect of the use upon the potential market for or value of the copyrighted work.

You can find the rest at http://en.wikipedia.org/wiki/Copyright. There's also very useful discussion of all this stuff at the University of Texas library site (Texas! Of all places!), which you can read here.

Now you're frustrated because even if you wanted to do the right thing, the ethical and legal thing, you still need a credit card to buy the sheet music and that isn't going to happen. Listen, Eleanor, I'm frustrated on your behalf. It really sucks to be a teenager. I'm not being sarcastic or ironic, I really get it. I wrote a whole show about it. But being able to steal something doesn't mean you should. If your parents really won't pony up the four bucks to buy a copy of the sheet music, then you can ask them to take you to the library and you can take out all the music you want, free, and pick the song you want to use for an audition or a talent show, and you can keep borrowing the book from the library until you're done with it or until the library demands it back. My song may not be in your library – you could ask them to get it from another library, through an interlibrary loan (this is common, standard library practice), but if you're in a time crunch, that's not practical – so you may have to just pick another song. It may not be the perfect song, but if you're a talented girl, it won't matter all that much. As long as it shows off what you can do and who you are, it will suffice because you are a teenager and the people who you are auditioning for will cut you slack on that account.

That's the end of my jeremiad, and I'd be surprised if it persuaded you in any real way, but it is the truth and it is your responsibility as a citizen, as a member of the theatrical community, and as a considerate human being to pay attention to the laws, ethics and customs that make it possible for you to do the thing you love. I'm very much impressed by how passionately you've stood your ground, and how articulate you've been in doing so, and I can't tell you how excited I am that you didn't misspell anything, not once in this entire exchange. (Well, you wrote "you're" when you meant "your" once, but I'll let it go.) But being able to argue a point doesn't make it right – lots of lawyers lose cases all the time.

I'm sorry if you still think I'm a jerk, but what I'm talking about here is not "insignificant." The entire record business is in free-fall because people no longer feel the moral responsibility to buy music; they just download it for free from the Internet, from YouTube, from their friends. When I make a cast album or a CD of my own, I do it knowing that it will never earn its money back, that I'm essentially throwing that money away so that I can put those songs out in the world. That shouldn't be the case, and I suspect in your heart you believe that too. All of us who write music for the theater are very much concerned that the sheet music business will eventually go the same way as the record business. I'm doing my little part to keep that from happening.

If you want me to talk to your parents and ask them to buy you the sheet music, just have them write me an email. You know how to find me.

All best,

I look forward to any thoughts you all might have, and a lively discussion. And thank you, Eleanor, for letting me put our argument on this site.

UPDATE: Below, you will find 159 comments on this article. They range in tone from the supportive to the hostile to the obnoxious; I've read them all and responded to a majority of them, as you can see. I have printed every single comment that came in to this site with the exception of four or five that seemed to me to be unnecessarily personal attacks on Eleanor, and a couple that were just silly pranks. I think there's a wide range of thought and discussion covered here, and while I'm very grateful for the breadth of topics and ideas broached herein, I've got to shut the comments down at this point so I can get back to work. Thank you all for participating.

FURTHER, AND HOPEFULLY FINAL, UPDATE: For those of you who were concerned, I did eventually hear from Eleanor. She said she didn't feel annoyed or offended that I had posted her remarks, she did understand where I was "coming from," and she appreciated that I took the time to deal with her. I also heard from her mother. And her brother. I have also heard from a continuing stream of extraordinarily hostile young men (always men) who insist on "educating" me on the ins and outs of cybermorality, the definition of "stealing," and why I deserve to choke on my own obsolescence. And I have heard from many very wonderfully kind and supportive people who pledged to do what they could, even if only in their own houses, to stop the rampant illegal and unpaid use of intellectual property, sheet music being only one example. It's been a fun ride, if a little exhausting, but you can all stop now. Have a good 4th of July weekend.


Then get a fucking job. If you're trying to make a living by selling information and you wind up going broke, then you have nobody to blame but yourself.

STUDIO SHAME! Even Harry Potter Pic Loses Money Because Of Warner Bros' Phony Baloney Net Profit Accounting
Mike Fleming

EXCLUSIVE: Signing a deal that makes anyone a net profit participant in a Hollywood movie deal has always been a sucker’s bet. In an era where studios have all but eliminated first dollar gross and invited talent to share the risk and potential rewards, guess what? Net profit deals are still a sucker's bet. I was slipped a net profit statement (below) for Harry Potter and The Order of the Phoenix, the 2007 Warner Bros sequel. Though the film grossed $938.2 million worldwide, the accounting statement below conveys that the film is still over $167 million in the red.

I ran the data above by several attorneys and agents, who are so accustomed to seeing studio accounting wave magic pencils over hit movies that they weren't surprised even a Harry Potter film that grossed nearly $1 billion would fall under the spell. Dealmakers say studio distribution fees are a killer, as are incestuous ad spends on studios' sister company networks. They also cited the $57 million in interest charges, an enormous pushback on profitablity. Since Warner Bros didn't invite in a co-financing partner on the Potter films, has the studio borrowed money from parent company coffers? Are they paying that interest to a bank, or to themselves? Bottom line: nearly $60 million in interest for the estimated $400 million required to make and market Harry Potter, charges carried for about two years, is a high tariff.

As one dealmaker tells me: "If this is the fair definition of net profits, why do we continue to pretend and go through this charade? Judging by this, no movie is ever, ever going to go to pay off on net participants. It's an illusion to make writers, and lower-level actors and filmmakers feel they have a stake in the game."

And yet Warner Bros isn’t doing anything differently here than is done by every other studio. Clearly, nothing has changed since Art Buchwald successfully sued Paramount over the 1988 hit Coming to America when the subject of net participation was scrutinized, and a judge called studio accounting methods “unconscionable”.

Movie’s Owners Want to Know if a Film Is Fit for Framing
Michael Cieply

Spun around politics, sexual identity and cinema, “Kiss of the Spider Woman,” nominated for four Oscars and the winner of one in 1986, is the consummate art film.

But is it a collectible work of art? Those who own it are trying to find out.

In an unusual twist even for a picture outside the norms — its Oscar-winning lead, William Hurt, paused his red-hot career to play a film-struck homosexual for almost no fee when that still seemed more suicidal than savvy — David Weisman, the movie’s producer, and David S. Phillips, who joined him later in acquiring its rights, are planning in coming weeks to offer “Kiss of the Spider Woman” for sale as an artwork.

By that, they mean an object of beauty. The film is now available in its entirety — its copyright, negatives, prints, digital video masters and more — along with a carefully preserved archive that includes 313 boxes of 35-millimeter outtakes, five drafts of the screenplay by Leonard Schrader and a stack of rejection letters from studio executives who were sure that the movie would never work.

“I’m not aware of its having been done before,” said Grey Smith, who specializes in film collectibles at the Heritage Auction Galleries in Dallas, and is not involved in the “Spider Woman” sale.

“I wish them the best,” Mr. Smith added. “This could open up avenues for people who own rights to other feature films.”

After their commercial release, feature films are typically held in clumps, like the 4,000-title library owned by Metro-Goldwyn-Mayer, or the smaller collection of about 700 movies and television shows at Miramax Films, which is now being sold by the Walt Disney Company.

But independent films sometimes fall out of the system, as agreements under which they were licensed for distribution expire, and the copyright remains with, or is acquired by, individual owners who are not aligned with any of the major film companies.

Such outlying works normally have little value for large distributors, which may buy them for a relatively small fee, based on future returns in the home video and television markets, but which remain far more interested in fresh films or mass transactions.

“It’s really difficult to sell just one film to that universe,” said Stephen Prough, a founder of Salem Partners, a Los Angeles investment banking firm that handles entertainment transactions. Mr. Prough said it was unusual even to find a single film with its rights held by one or two individuals.

About 10 years ago, however, Mr. Weisman, an independent producer whose latest passion is a proposed Bollywood gangster project called “Xtrme City,” joined Mr. Phillips, a lawyer who had come to view “Kiss of the Spider Woman” as an important event in the history of public art, in consolidating their ownership of all rights to the film, as licensing agreements with Island Alive and other distributors expired.

They released the picture, which was shot in Brazil by the Argentine-born director Hector Babenco, along with a documentary, “Tangled Web,” about its making, on a DVD from the Independent Cinema Restoration Archive, an operation managed by Mr. Weisman.

But as Mr. Weisman and Mr. Phillips explained during a tangled luncheon conversation in Los Angeles last week, they also conceived the idea of selling the movie — along with its extraordinary archive of negatives, prints and associated materials that Mr. Weisman had kept in a Los Angeles warehouse — to an institution or private collector who would value it not as a library title, but as art.

“Actually, I said we should give it away,” said Mr. Phillips, who spoke intently of things like “heteroglossia,” the diversity of voices and viewpoints, in a literary work.

Not as eager to part with an asset on those terms, Mr. Weisman, who at lunch mostly out-talked Mr. Phillips, argued for a sale modeled on his earlier experience with a collection of more than 8,000 movie lobby cards. Those were amassed by the screenwriter Mr. Schrader, a close friend, then sold intact after his death in 2006 to a film buff in India.

So Mr. Phillips, with help from Mr. Weisman, designed a prospectus for their film and its archive. With the sale, it promises, “ ‘Kiss of the Spider Woman’ transcends mere commodity and reclaims its aura as a unique work of art.” .

And John Wronoski, the proprietor of Lame Duck Books, a Cambridge, Mass., dealer, now says he expects to begin offering the film privately to a small group of potential buyers in the next month or so.

While he generally deals in books, Mr. Wronoski explained in a phone interview this week, the large collection of film and papers associated with “Kiss of the Spider Woman,” including early drafts of a script written by Burt Lancaster, who once meant to star in the movie, and Manuel Puig, who wrote the underlying novel, make it an attractive proposition.

“There aren’t many archives that would be even remotely similar to this,” he said.

(Props and costumes from “Kiss of the Spider Woman,” which took in $17 million at the domestic box office after its release in 1985, have long since been destroyed or dispersed.)

At the Museum of Modern Art in New York, Katie Trainor, the film collections manager, said her institution held the copyright to only a tiny handful of the roughly 26,000 shorts and feature-length movies, none well known, of which it owns prints.

Most often, Ms. Trainor said, the museum is simply authorized to screen its movies on site, and may get permission to lend them to others.

For their own film — with which remake rights and everything else are included — Mr. Weisman and Mr. Phillips declined to say what they would accept as a minimum bid. Mr. Wronoski said he had a number in mind but also declined to discuss it.

And what a buyer might ultimately do with the movie is an open question. Over lunch, Mr. Weisman and Mr. Phillips suggested, for instance, that a new owner might digitize all of the filmed material and offer admirers the chance to rebuild it according to a vision of their own.

Reached by e-mail, Mr. Babenco said he hoped that the scripts and other material associated with “Kiss of the Spider Woman” would become accessible to the public after their sale. “I would love to keep historical elements of all my movies alive,” he said.
In any case, Mr. Weisman said he and Mr. Phillips expected to find a buyer who would remove the film from an industry that, in his view, no longer respects its own wares.

“The diminishment is appalling to me,” Mr. Weisman said of the movie business.

Asked whether he would accept a good offer from a Warner or a Paramount that wanted to add a jewel to its existing collection, Mr. Weisman dismissed the notion as fantasy.

“If the Hudson River were made out of grape juice, you could drink it,” he said.

Netflix Inks Movie Deal with Relativity Media

U.S. DVD rental service Netflix Inc said it has signed a deal with media company Relativity Media LLC to stream major theatrical movies to Netflix customers before they are shown on premium pay-television channels.

The deal marks a continued shift in the distribution of major motion pictures in the United States, Netflix said in a statement on Tuesday.

Under the deal, popular contemporary movies previously shown exclusively on premium channels such as HBO, Showtime and Starz will now become available to be streamed from Netflix months after their release on DVD.

The first movies to be distributed will be "The Fighter" and "Skyline."

It will be the first time studio quality theatrical feature films will be streamed via subscription by Netflix instead of being broadcast by the traditional pay channels and it opens up a new revenue stream for such movies, the company said.

Relativity Media has financed, co-financed or produced more than 200 features, generating more than $13 billion in worldwide box office revenue.

"Historically, the rights to distribute these films are pre-sold to pay TV for as long as nine years after their theatrical release," Ted Sarandos, chief content officer for Netflix said.

(Reporting by Sakthi Prasad in Bangalore; Editing by David Holmes)

Future Of 3-D TV Remains Hazy

Surveys show few are familiar with the technology, but analysts foresee it catching on — eventually
Kristena Hansen

Barely settled into their first home together, Arman Galstyan and Carolyn Kaloostian were itching to buy a new television to go with it.

But the couple were not about to settle for just any big-screen, high-definition flat-panel.

It had to be 3-D.

"We had been wanting to get it, and when we heard they came out, we didn't even let a chance for competition to bring the prices down," said Kaloostian, 27, as her fiance paid the cashier at a Best Buy in California.

"We just wanted to get the newest thing out," she said.

That's just what television manufacturers, which began rolling out a new generation of 3-D-capable sets amid much hype early this year, want to hear.

But the first sales figures on 3-D TVs and a new consumer survey indicate that the industry has a long way to go before the technology catches on in a big way, if it ever does.

In the sets' first three months on the market, beginning in February, consumers nationwide spent about $55 million on 3-D-capable TVs and related equipment, according to an NPD Group survey of some of the largest retailers carrying the products, including Best Buy and Amazon.com.

Paul Gagnon, an analyst with market research and consulting firm DisplaySearch, calculated that based on the NPD figures, about 20,000 of the flat-panel sets were sold by those major retailers.

That's a tiny number compared with the approximately 7 million TV sets overall that were shipped to retailers around that time frame, according to the Consumer Electronics Association trade group.

And a study last month by research firm Parks Associates showed that despite the success of several recent 3-D movies, awareness of the home technology is middling.

"We don't see a large percentage of people going out of their way to go buy a new TV just because of 3-D," said Parks analyst Pietro Macchiarella.

He and other analysts say the slow going was to be expected, especially considering that the only major manufacturers with the 3-D sets available in the period were Samsung and Panasonic. Parks forecasts that sales will shoot upward as more manufacturers send sets to market. In 2014, the firm estimated, 80 percent of TVs sold will be 3-D capable.

But Macchiarella had not expected only 13 percent of the people surveyed to describe themselves as "familiar" with 3-D TV.

"I think it's a little bit of a surprise," he said.

Despite the hype, only a tiny amount of 3-D content has been available for the home screen. That's changing, albeit slowly. World Cup soccer matches, for example, can be viewed in 3-D by DirecTV and Comcast cable subscribers.

Macchiarella said the matches could increase the awareness of 3-D. "Maybe in the next study we'll get better data," he said.

Sports could be key for many consumers.

"It'll be cool to have basketball in 3-D," said George Preciado, 33, who said he has made four trips to different stores to look at sets.

He's also a gamer, which could make him a more likely candidate to buy a set as more video games in the format become available.

"It's going to add a tremendous amount to the gaming experience," said Bill Hunt, editor of The Digital Bits, a blog about TV technology.

Gamers, Hunt said, are often big spenders, and 3-D-capable sets are sold at premium prices. Gagnon of DisplaySearch said the average is about $2,500.

Illinois resident Aaron Swarvar, 29, bought a Samsung 3-D-capable set last month and said the need for glasses was one of the few downsides. The TV came with two pairs, and extras will cost him $100 apiece.

He also said he's been experiencing some of the eye discomfort that has long been associated with watching 3-D movies in theaters.

"It's straining to watch for a prolonged period of time," Swarvar said.

A study this year at the University of California- Berkeley indicated that the problems, which also can include blurred vision and headaches, could be worse at home.

"The issue arises more with TVs because the distance is closer than at a theater," said Martin Banks, a professor of optometry and vision science who conducted the study with 17 subjects.

He said the problems go away shortly after a viewer stops watching 3-D. "We don't know of anyone who has had any consequences that lasted more than a handful of minutes," Banks said.

Movses Ambarthian, a Best Buy salesman, said eye strain is an issue for some customers.

"We do get people asking about that," he said. But that doesn't keep people from making themselves comfortable on the sofas and chairs in the high-end section of his store to watch 3-D, sometimes for extended periods.

That seemed OK with Ambarthian, who acknowledged that springing for the new technology is a big decision for buyers.

"This experience," Ambarthian said, "it takes a long time."

Old Movie Houses Find Audience in the Plains
Patricia Leigh Brown

Every Friday through Monday night, from her perch behind the Skittles and the M&M’s, Amy Freier awaits the faithful at the historic Roxy Theater. There is Dale Klein, the school bus driver (large Diet Pepsi with a refill). And there is Jeannette Schefter, the social worker (large plain popcorn, medium Diet).

“You know who comes,” said Ms. Freier, one of 200 volunteers in this town of roughly 2,000 who are keeping the Roxy’s neon glowing. “They’re part of the theater.”

In an age of streaming videos and DVDs, the small town Main Street movie theater is thriving in North Dakota, the result of a grass-roots movement to keep storefront movie houses, with their jewel-like marquees and facades of careworn utility, at the center of community life.

From Crosby (population 1,000), near the Saskatchewan border, to Mayville, in the Red River Valley, tickets are about $5, the buttered popcorn $1.25 and the companionship free.

“If we were in Los Angeles or Phoenix, the only reason to go to a movie would be to see it,” said Cecile Wehrman, a newspaper editor who, with members of the nonprofit Meadowlark Arts Council resuscitated the Dakota in Crosby, its plush interiors now a chic black, red and silver. “But in a small town, the theater is like a neighborhood. It’s the see-and-be-seen, bring everyone and sit together kind of place.”

The revival is not confined to North Dakota; Main Street movie houses like the Alamo in Bucksport, Me., the Luna in Clayton, N.M., and the Strand in Old Forge, N.Y., are flourishing as well. But in the Great Plains, where stop signs can be 50 miles apart and the nearest multiplex is 200 miles round trip, the town theater — one screen, one show a night, weekends only — is an anchoring force, especially for families.

It is a tradition that comes with a delicate social choreography (kids up front, teenagers in the back — away from prying parental eyes) and in spite of nature’s ferocity (subzero temperatures can freeze the coconut oil for the popcorn machine).

Steve Hart, 40, a farmer in Langdon who helped revive the Roxy, tells of a paralyzing Christmas blizzard several years ago. The phone started ringing shortly afterward.

“Do you have a movie?” people wanted to know.

“An hour later,” he recalled, “there were 90 people on Main Street, even though there was only one path through the drifts and the movie was ‘Alvin and the Chipmunks: The Squeakquel.’ ”

To Tim Kennedy, a professor of landscape architecture who has traveled across the state to survey little theaters for a book, the communal will of rural towns that keep theaters going represents “buildings as social capital,” forged “outside the franchise cinemas and their ubiquitous presence at the malls.”

Of the 31 operating historic theaters identified by Mr. Kennedy, 19 are community-run, little changed from the days when itinerant projectionists packed their automobile trunks with reels of film and hit the road. Many retain the upstairs soundproof “cry rooms” for fussy babies.

Their collective rejuvenation reveals a can-do spirit — as in Cando (population 1,250), home to the historic Audi Theater.

Robert Schwanz, a 55-year-old farmer and electrician in Crosby, volunteers at the Dakota, fixing the sound system, mending wires, repairing the projector. “Our grandparents homesteaded,” he said, sitting in an empty row of seats one recent afternoon. “We’re only two generations out. It’s part of the culture to take care of the neighbors, help each other.”

Crosby citizens launched into John Wayne mode in 2000 when the owner could no longer afford to keep the theater going with a “Nickels for Neon” drive.

Today, the Dakota is a star with many roles. It is a destination for high school students on a Saturday night. It is where county employees and local farmers discuss noxious weeds, and where the crowd pours in after football games to watch highlights on the big screen. On Oscar night, the program is shown live. Everyone in town gussies up and walks a red carpet donated by a local furniture company.

To Tom Isern, a professor of history at North Dakota State University Fargo, citizens championing theaters represent “a bounce back from the bottom” for small North Dakota towns. Crosby, for instance, is the seat of Divide County, which lost 14 percent of its population over the past decade but is now rebounding due to oil revenues. Baby boomers are in a position to help.

“They are the last picture show generation on the plains,” he said, “who can remember that movie theater experience and want to transmit that to their kids.”

Films veer heavily toward G and sometimes PG-13 ratings.

“Sex and the City?” said Ms. Freier, the Roxy volunteer. “People don’t relate to that here.”

Lauren Larson, a school counselor in Fargo and co-owner with her husband, Steve, of the Delchar, has a motherly eye. When she spied a 14-year-old watching “The Last Boy Scout,” which is rated R, she called his father. “It’s hard for me to let them in when I know the movie is not good for them,” she said.

For the parents of teenagers, the appeal of a hometown movie theater is often safety more than sentiment. “The snow can kick up in a matter of minutes,” said Dean Kostuck, the father of Hailey, 16, and Hillary, 20. “You’ve got to worry.”

At the Lyric in Park River, a silent-picture-era theater once presided over by Laura McEachern, who dealt with rustling candy wrappers “by stalking the aisles with a pen flashlight and shining it right in your eye,” her 81-year-old niece, Lorna Marifjeren, recalled, most of the volunteers are teenagers like Trey Powers. “If the theater wasn’t here, a lot more people would be drinking,” he said.

North Dakota ranked first in the nation for binge drinking in 2009, and some volunteers at the Lyric include teenagers assigned to community service by the court. “Most sure don’t mind,” said Jim Fish, the juvenile court officer for Walsh, Cavalier and Pembina Counties. “It’s a neat fit. There is a sense of helping the community out.”

For older residents, theaters are a link to a rapidly vanishing past. Movie rentals are the biggest threat, said Babe Belzer, 74, who led the drive to restore the Lyric with fellow Jazzercisers.

“If you can get a whole living room of kids watching a movie for three bucks, what a deal,” she said. “But at the theater,” she continued, “the phone doesn’t ring, it’s not time to change the clothes from the washer to the dryer, and there isn’t anyone at your door. It’s kind of the heart and soul of our town.”

The Curse of the Little Rascals
Miss Cellania

When Robert Blake was arrested in 2002 and charged with the murder of his wife, a lot of people began to look back and wonder if the kids who starred in the Our Gang films were under some kind of cloud.


According to Our Gang producer Hal Roach, 176 kids played in the 221 Our Gang films made between 1922 and 1944. Only a few of these became major stars in the series.

It’s not unusual for child stars to have a difficult time as they move into adulthood, and if anything life in the 1920s, ’30s, and ’40s was even tougher. Children who worked in the series typically started out earning less than $100 a week, and they never earned residuals-when the Our Gang films made their way to television in the early 1950s, the kids didn’t get a penny. Result: when their fame ended, they didn’t have any money to fall back on like child stars do today.

When you consider how many kids cycled through the Our Gang series, it stands to reason that quite a few of them would have problems later in life. Even so, the number of kids who suffered misfortune over the years is startling. You can’t help but wonder: Are the Little Rascals cursed?


*Carl “Alfalfa” Switzer: Like many of the Little Rascals, Switzer had trouble finding movie roles as he grew older. He landed bit parts in films like It’s a Wonderful Life and The Defiant Ones, supporting himself at such odd jobs as bartender, dog trainer, and hunting guide between acting gigs. He was shot to death in 1959 following an argument over $50. He was 31. (Carl’s older brother, Harold, also appeared in the Our Gang series; in April 1967 he murdered his girlfriend and then killed himself. He was 42.)

*William “Buckwheat” Thomas: When his career in front of the camera ended, Thomas became a film technician with the Technicolor Corporation. In October 1980, a neighbor who hadn’t seen Thomas in several days entered his home and found him dead in bed. Cause of death: heart attack. Thomas was 49.

*Robert “Wheezer” Hitchins: A cadet in the Army Air Corps, Hitchins was killed in 1945 while trying to land his plane during a training exercise. He died a few days shy of his 20th birthday.

*Matthew “Stymie” Beard: A high school dropout, Beard fought a heroin addiction for more than 20 years and was frequently in and out of prison. He beat the habit in the 1970s, but passed away in 1981, at age 56. Cause of death: pneumonia, following a stroke.

*”Darla” Hood Granson: Contracted hepatitis while in the hospital for minor surgery and died in 1979 at the age of 47.

*Norman “Chubby” Chaney: Chaney’s weight was due to a glandular problem; by the time he was 17 he weighed more than 300 pounds. In 1935 he had surgery to treat his condition; that dropped his weight down to 130 pounds, but he never regained his health. He passed away in 1936 at the age of 18.

*”Scotty” Beckett: Scotty was the kid who wore a cap turned to the side of his head. A classic case of troubled former child star, Beckett slid into alcohol and drug abuse when his acting career petered out. He had two failed marriages, a history of violence, and numerous run-ins with the law. In 1968 he checked into a Hollywood nursing home after someone beat him up; two days later he was dead. Investigators found a bottle of pills and a suicide note by his bed, but the coroner never ruled on whether it was the beating or the barbiturates that killed him. He was 38.

*William “Froggy” Laughlin: Rear-ended and killed by a truck while delivering newspapers on his motor scooter in 1948. He was 16.

*Richard “Mickey” Daniels: Long estranged from his wife and children, Daniels died alone in a San Diego hotel room in 1970. Cause of death: cirrhosis of the liver. Years passed before his remains were identified and claimed by his family. Daniels was 55 when he died; he is buried in an unmarked grave.

*Bobby Blake: (He used his real name, Mickey Gubitosi, in the Our Gang films until 1942.) If you’re charged with murdering your wife and you beat the rap, does that count as being cursed or beating the curse? In the 1990s, Blake took up with a woman named Bonnie Lee Bakley. He didn’t know it at the time, but she was a celebrity-obsessed con artist who wanted to have a baby with a Hollywood star. Blake took the bait, and in 2000 Bakley gave birth to Blake’s daughter. Five months later they were married.

On May 4, 2001, Bakley was shot in the head and killed while sitting in her car outside a restaurant where she and Blake had just eaten dinner. In April 2002, Blake was arrested and charged with Bakley’s murder; in March 2005, a jury found him not guilty. He beat the rap, but the media continues to doubt his innocence. Bblake says that as a result of the ordeal, he’s now destitute.


*Robert “Bonedust” Young. Fell asleep while smoking in bed in 1951; he died in the ensuing fire at the age of 33.

*Jay “Pinky” Smith (aka the freckle-faced kid). Stabbed to death in 2002 by a homeless man he’d befriended, who then dumped Smith’s body in the desert outside of Las Vegas. He was 87.

*”Dorothy” Dandridge. Committed suicide in 1965 after losing all her money in a phony investment scheme. She was 41.

*Kendell “Breezy Brisbane” McComas. Committed suicide in 1981, two weeks before being forced into retirement as an electrical engineer. He was 64.

*Darwood “Waldo” Kaye. Waldo was the rich kid with glasses who competed with with Spanky and Alfalfa for Darla’s affections. In 2002 he was struck and killed by a hit-and-run driver while walking on the sidewalk. He was 72.

*Pete the Pup. The first dog to play Pete was poisoned by an unknown assailant in 1930.


Hal Roach, who outlived many of his child stars and died in 1992 at the age of 100, never believed that the kids were cursed. “Naturally, some got into trouble or had bad luck,” he told an interviewer in 1973. “They’re the ones who made the headlines. But if you took 176 other kids and followed them through their lives, I believe you would find the same percentage of them having trouble later in life.”

From [url=https://bathroomreader.theretailerplace.com/MLBX/actions/searchHandler.do?userType=MLB&tabID=BOOKS&itemNum=ITEM:1&key =0006466741&nextPage=booksDetails&parentNum=11997Uncle John’s Fast-Acting Long-Lasting Bathroom Reader[/url]


Artist’s Daughter Seeks Return of Nude Videos
Kate Taylor

It is a treasure trove of letters, paperwork, photographs and film that document the New York artistic and literary scene from the 1940s through the 1980s.

The archives of the proto-Pop artist Larry Rivers, who died in 2002, will arrive at New York University in a few weeks, filled with correspondence and other documents that depict his relationships with artists like Willem de Kooning and Andy Warhol and writers like Frank O’Hara and John Ashbery.

But one part of the archive, which was purchased from the Larry Rivers Foundation for an undisclosed price, includes films and videos of his two adolescent daughters, naked or topless, being interviewed by their father about their developing breasts.

One daughter, who said she was pressured to participate, beginning when she was 11, is demanding that the material be removed from the archive and returned to her and her sister.

“I kind of think that a lot of people would be very uptight, or at least a little bit concerned, wondering whether they have in their archives child pornography,” said the daughter, Emma Tamburlini, now 43.

Ms. Tamburlini said the filming contributed to her becoming anorexic at 16. “It wrecked a lot of my life actually,” she said.

Her older sister, Gwynne Rivers, declined comment.

N.Y.U. has agreed to discuss the matter and has already, at the urging of the foundation, pledged to keep the material off limits during the daughters’ lifetimes. Two years ago Ms. Tamburlini asked the foundation to destroy the tapes, but it declined.

The Rivers Foundation’s director, David Joel, said that he sympathized with Ms. Tamburlini but that he could not agree to destroy the tapes.

“I can’t be the person who says this stays and this goes,” he said. “My job is to protect the material.”

The dispute bears some resemblance to a debate in the 1990s over work by two photographers that raised questions about the extent to which parental consent, naturalism, sexuality and the tradition of the artistic nude play a role in the depiction of naked children.

After Jock Sturges photographed adolescent and pre-adolescent girls in “naturist” communities, with their parents’ consent, the F.B.I. raided his studio as part of an investigation of child pornography. But a grand jury in San Francisco declined to indict him.

Sally Mann exhibited photographs of her three children, dressed and undressed, and critical opinion largely supported her, in part because her children seemed to have participated happily in her work. Ms. Mann said years ago that she never told her children to take their clothes off — they were naked already — and that she stopped photographing them when they reached puberty.

In Rivers’s case the material seems more overtly sexual, including close-up shots of one daughter’s genitals and detailed commentary by Mr. Rivers on the girls’ changing bodies.

The dean of the N.Y.U. Libraries, Carol Mandel, said in a statement that the university believes the “reasonable privacy wishes” of a child should be considered.

“If the extent of the restriction currently planned should be greater, we can have conversations with all the interested parties about the handling of this material going forward,” she said.

Rivers, who was born Yitzroch Loiza Grossberg, performed as a jazz saxophonist in his 20s and then studied painting with Hans Hoffman. At a time when abstraction reigned supreme, he made a stir by reintroducing figuration in works like “Frank O’Hara Nude With Boots” (1954) and “Washington Crossing the Delaware” (1953), a postmodern take on history painting.

His reputation declined somewhat after the 1950s, although recent shows at Guild Hall in East Hampton, N.Y., and the Tibor de Nagy Gallery in Manhattan attracted critical praise.

Rivers was a major figure in the New York arts scene, a friend of dozens of artist, writers and musicians, from Leonard Bernstein and Jasper Johns to Kenneth Koch and Terry Southern. He acted in the Beat film “Pull My Daisy” with Allen Ginsberg and Gregory Corso and made a documentary, “Africa and I,” with the Oscar-winning filmmaker Pierre-Dominique Gaisseau.

N.Y.U. officials said they hoped that the archive would provide greater context for Rivers’s work and for that of the artists he interacted with. “It’s one of those collections that we talk about in the rare-book world,” said Marvin Taylor, the director of the Fales Library and Special Collections at N.Y.U.

The university is planning to spend two years processing the archive.

Rivers cast himself as something of a wild man, and in his 1992 autobiography, “What Did I Do?,” he chronicled, among other things, his heroin use, his effort to sleep with his mother-in-law and numerous affairs, including one, when he was in his 40s, with a 15-year-old girl. In describing his own early experiences, he wrote that his father tried to molest the first girlfriend he brought home and said that an 11-year-old boy in his neighborhood forced him to perform a sex act when he was 6.

Ms. Tamburlini said her father filmed his daughters every six months over at least five years for a body of work he titled “Growing.” If she objected, she said, she was called uptight and a bad daughter. When she confronted her father as a teenager about the films, she said he told her “my intellectual development had been arrested.”

In 1981 Rivers edited the footage into a 45-minute film that he planned to show as part of an exhibition. The girls’ mother, Clarice Rivers, who also appears in parts of the film, intervened and stopped him.

In the film Rivers tells the girls to take off their clothes and then zooms in on their breasts from various angles. He interviews them about how they feel about their breasts and whether boys have started noticing them. In some scenes Clarice Rivers appears with her daughters, displaying her own breasts and talking about them.

In a voice-over Rivers says that he made the film over several years in spite of “the raised eyebrows of society in general and specific friends and even my daughters — they kept sort of complaining.” On screen both girls appear self-conscious as they grow older, and Emma in particular hardly speaks.

Clarice Rivers said in an interview that she supports her daughter’s effort to get the film back, though she describes it more benignly as a document of the girls’ development.

“What Larry said was that it would belong to them, as a record that when they got older they could look back at,” she said.“It wasn’t a huge thing. It’s become huge, because they can’t get back what was given to them.”

Ms. Tamburlini, though, said she has spent several years in therapy trying to deal with the effect of her father’s behavior.

“I don’t want it out there in the world,” she said. “It just makes it worse.”

Feminist War Over Smut Rages On

Sex writer Violet Blue launches a pro-porn campaign to counteract an upcoming anti-porn conference
Tracy Clark-Flory

It's time to check back in with the feminist battle over porn. I've entirely lost track of the score, but I can report that it's still going strong ... -ish. OK, so it's still going, that much is indisputable, because sex writer Violet Blue just kicked off a feminist pro-porn campaign in an attempt to preempt a feminist anti-porn conference being held next weekend in Boston.

On the website "Our Porn, Ourselves," she explains the movement's raison d'être like so: "We women are tired of people trying to control our sexuality by telling us what we should or shouldn’t like sexually (porn) based on what someone else thinks is best for us." Righteous. She also makes a call for supporters to submit "a short video that tells us you are pro-porn." The site's tagline: "Women like to watch porn. Deal with it."

I dig the in-your-face, screw you attitude, and I consider myself a pro-porn feminist. So, if you detect a lack of enthusiasm, it isn't because I think it's a boring or unworthy aim. In fact, the intersection of feminism and porn makes for one of my favorite subjects, and it's one I've been thinking, reading and writing about for most of my adult life. I just can't believe we're still debating whether porn is a good or a bad thing, feminist or antifeminist -- as though it falls clearly into one clear, impermeable category.

There have always been feminists who love porn, feminists who hate porn and feminists of every ambiguous type in-between. There are women who both love and hate porn, depending on the actual content of the porn. There are women who like the idea of porn but haven't been satisfied by any of the porn they have actually come across. And there are women who watch porn, but don't want to broadcast their love for smut to the entire world in a gesture of online activism.

As the author of "The Smart Girl's Guide to Porn," you can be sure that Blue understands this all too well. The truth, though, is that you don't get much attention for talking about the intricacies of female sexuality. Part of the reason the so-called Feminist Porn War has been raging for so long is that we rarely hear about arguments that don't fit an either-or framework. Anything in-between women's all-out hate or love of porn could mean talking about the variability of female sexuality -- and we're clearly much more comfortable labeling it a dysfunction and taking a pill for it.

Finland Enshrines 'Legal Right' to Broadband

Finland has made access to broadband connections to the internet a legal right for every one of its citizens in the first legislation of its kind anywhere in the world.
Bonnie Malkin

From today, all Finns will have the right to a 1 megabit per second (Mbps) broadband connection.

Under the new law, telecommunications companies will be obliged to provide all citizens with broadband lines that can run at a minimum of 1Mbps.

In addition, the government has promised that by 2015, the entire population will have a 100Mbps connection.

Suvi Linden, the country's communications minister, said the internet was part of everyday life for Finnish people and that high speed internet access was a priority for the government.

"Internet services are no longer just for entertainment," she told the BBC.

"Finland has worked hard to develop an information society and a couple of years ago we realised not everyone had access."

Up to 96 per cent of the population is already online and only about 4,000 homes will need to be connected to comply with the law.

However, the plan means it will be difficult for the authorities to cut off people suspected of illegal file-sharing. Instead of restricting internet access, the Finnish government plans to send letters to anyone breaking piracy laws.

In Britain, the government has promised a minimum connection of at least 2Mbps to all homes by 2012 but has stopped short of enshrining this as a right in law.

Internet penetration in Britain stands at 73 per cent.

Burglars Thwarted by Homeowner, 1700 Miles Away

A man in Nova Scotia contacted the Lee County Sheriff's Office because two men were burglarizing his home in Lehigh Acres, reports said. The victim, who had a surveillance system in his Lehigh Acres home, emailed deputies photos of the suspects.

Friday night around 11:20 p.m., Jason Hatfield of Nova Scotia contacted Lee County deputies about a burglary in progress at 102 Orkney Court in Lehigh Acres.

When the first deputy arrived on scene, he saw a gold Range Rover pulling away from the home on Orkney Court with its headlights off, reports said. The deputy conducted a traffic stop on the vehicle.

The driver first told the deputy his name was Tomas Andres Fernandez, but later gave him his real name, Joel Juan Fernandez. His license was suspended for failure to pay child support, reports said.

Fernandez told the deputy he was in the area to check on his friend Rudy, but didn't know the man's last name, reports said.

The passenger was identified as Juan Carlos Morales. He had a handheld laser in his back pocket, which doubled as a flashlight, reports said.

Deputies contacted the homeowner, who provided still photographs from the surveillance system that showed the burglary suspects via email.

According to the deputy, one of the suspects in the photographs was Morales, who was wearing white gloves on both hands, according to the surveillance photos.

Deputies found several electronic items and computer equipment in the Range Rover and provided photographs of the items to the victim via email. He positively identified the items as his, according to reports.

The items were valued at over $1,000, reports said.

Morales was arrested and charged with burglary to a dwelling, grand theft, carrying concealed weapon, possession of burglary tools.

Fernandez was charged with armed burglary to a dwelling, grand theft, driving while license suspended first offense, giving false name to LEO

Slower Reading on iPads and Kindles?
Josh O'Connell

Nielsen Norman Group determined that people read as much as 10 percent slower on devices like the Kindle or iPad than from a printed word in a usability study. In the “grain of salt” portion of the category, 24 people were utilized for the study (although 10 is average for usability studies).

Users ranked the iPad and Kindle higher on satisfaction than the printed book, and much higher than the PC screen (which they said felt too much like work). The tests were done with an Ernest Hemingway writing.

Even if it’s questionable given the small sample, it’s interesting data in an area which will most likely get a lot of study and attention over the coming months and years.

Microsoft Calling. Anyone There?
Ashlee Vance

Microsoft’s engineers and executives spent two years creating a new line of smartphones with playful names that sounded like creatures straight out of “The Cat in the Hat” — Kin One and Kin Two. Stylish designs, an emphasis on flashy social-networking features and an all-out marketing blitz were meant to prove that Microsoft could build the right product at the right time for the finickiest customers — gossiping youngsters with gadget skills.

But last week, less than two months after the Kins arrived in stores, Microsoft said it would kill the products.

“That’s a record-breaking quick end to a product, as far as I am concerned,” said Michael Cronan, a designer who helped drive the branding of products like Kindle for Amazon and TiVo. “It did seem like a big mistake on their part.”

The Kins’ flop adds to a long list of products — from watches to music players — that have plagued Microsoft’s consumer division, while its business group has suffered as well through less-than-successful offerings like Windows Vista and Windows for tablet computers.

In particular, the Kin debacle is a reflection of Microsoft’s struggle to deliver what the younger generation of technology-obsessed consumers wants. From hand-held products to business software, Microsoft seems behind the times.

Part of its problem may be that its ability to intrigue and attract software developers is also waning, which threatens its ability to steer markets over the long term. When it comes to electronic devices, people writing software have turned their attention to platforms from Apple and Google.

Meanwhile, young technology companies today rely on free, open-source business software rather than Microsoft’s products, so young students, soon to be looking for jobs, have embraced open-source software as well.

“Microsoft is totally off the radar of the cool, hip, cutting-edge software developers,” said Tim O’Reilly, who publishes a popular line of software development guides.

“And they are largely out of the consciousness of your average developer.”

The Xbox 360 gaming console and its complementary online services have been a rare hit with consumers. Still, being hip matters only so much for Microsoft, whose profits remain the envy of the business world. Microsoft’s software like Windows and Office remain the dominant standard around the world and afford the company an ability to experiment wherever it pleases.

“When you look at the overall numbers and who buys and uses our products, I think our track record is pretty good with all demographics,” said Frank X. Shaw, Microsoft’s head of communications. “We really do think about serving billions of people and are on a playing field that nobody else in the industry is.”

In May, Microsoft announced a shake-up of its consumer and entertainment division with the retirement this fall of the group’s head, Robert J. Bach, and the departure of an important designer, J Allard.

Steven A. Ballmer, the company’s chief executive, now has the heads of the main consumer and entertainment-oriented products reporting directly to him. While Mr. Ballmer has been praised for increasing Microsoft’s main, old-line businesses, he has come under increasing fire for failing to read changing trends in the market and capitalize on them.

Nowhere is that more apparent than in Microsoft’s come-from-behind strategy in the consumer device market.

In 2008, Microsoft acquired a start-up, Danger, that had built popular mobile phone software, hoping that technology would revitalize its waning phone software business. But Microsoft stumbled as it took longer than expected to create a new product with the technology. In April, Microsoft finally introduced the fruits of this labor when it unveiled the Kin phones.

In contrast, Google, a chief Microsoft rival, also bought a mobile technology start-up — Android. Both Android and Danger were co-founded by Andy Rubin, who joined Google.

Google has since turned the Android software into the foundation of a fast-growing mobile phone empire with carriers all over the world releasing products that use the technology.

Microsoft, however, has reassigned the Kin development team and put them to work on Windows Phone 7, yet another mobile phone platform, expected later this year.

“For developers, mobile is what’s hip now, and there are two platforms that matter — Apple and Android,” Mr. O’Reilly said.

The list of Microsoft’s consumer product slip-ups grows each year. Its line of intelligent watches — come and gone — often ends up as the butt of jokes, as do its tablet PC software products, the poor-selling Windows Vista operating system and the ignored Zune music player. The company also canceled its Courier tablet PC project shortly after the Apple iPad tablet went into stores.

Microsoft employees were dismayed when they anonymously visited Verizon stores and discovered that employees for the carrier were reluctant to sell the Kin, said a Microsoft executive close to the Kin project. Verizon, the only carrier behind the Kin, tended to promote phones running Google’s Android software.

“It was killed abruptly because no one was buying it and there no was no credible reason to believe anyone would,” this person said.

Fewer than 10,000 Kins were sold.

Mr. O’Reilly said the quick cancellation of the Kin may demonstrate that Microsoft has finally seen the depth of its woes when it comes to attracting consumers and younger audiences.

“This should be seen as a success for them,” Mr. O’Reilly said. “They grew fat and happy, but are now waking up to their different competitive position.”

Mr. O’Reilly traces part of the problem back to the company’s developers. Microsoft spends a great deal of time and money shepherding a vast network of partner companies and people that base their livelihoods on improving and supporting Microsoft’s products.

These software developers and technicians have bet their careers on Microsoft and largely benefited from that choice. In addition, they have helped keep Microsoft relevant during the various ups and downs in the technology market.

But the recent crops of computer science graduates and start-ups have tended to move far afield from Microsoft, Mr. O’Reilly said.

The vast majority of technology start-ups today rely on open-source software, distributed by Microsoft competitors, for the core parts of their technology infrastructure.

And so the technology-minded people coming out of college have started learning their craft on free software and betting their careers on non-Microsoft wares.

“We did not get access to kids as they were going through college,” acknowledged Bob Muglia, the president of Microsoft’s business software group, in an interview last year. “And then, when people, particularly younger people, wanted to build a start-up, and they were generally under-capitalized, the idea of buying Microsoft software was a really problematic idea for them.”

The loss of access to start-ups has already proved damaging to Microsoft as companies like Facebook and Twitter that rely on free software have grown from fledgling operations to Silicon Valley’s latest booming enterprises.

Microsoft has tried to court young developers and young companies. In November 2008, it created a pair of programs that give students free access to Microsoft’s business and developer software. In addition, Microsoft allows some start-ups to run their operations on its software at no cost over a limited period.

About 35,000 start-ups have been involved in the program since it began, the company said.

“For the most part, Microsoft has been great to work with,” said Mark Davis, the chief executive of Virsto, a software start-up that received aid from Microsoft. “It’s funny to be in Silicon Valley and say that.”

Others, however, laugh at the idea that Microsoft requires the start-ups to meet certain guidelines and jump through hoops to receive software, when its free software competitors simply allow anyone to download products off a Web site with the click of a button.

“We got introduced to Microsoft through our investors,” Mr. Davis said. “They don’t do this for just anybody.”

Frustrated by Flamebait NY Reporting in Microsoft Story
Tim O'Reilly

I was rather dismayed to find words put into my mouth in Ashee Vance's story http://www.nytimes.com/2010/07/05/te...pagewanted=all

The author wrote an opinion piece, but wrote it as if he were reporting comments I'd made.

While I agree that the general thrust of the story is correct, that Microsoft has lost a degree of its appeal to many young startups, who are focusing today on Apple and Android platforms (heck, even the web has lost its appeal to many young startups!), I don't remember saying anything like: “Microsoft is totally off the radar of the cool, hip, cutting-edge software developers.” My memory is that Ashlee opened our conversation with that assertion, which I countered by saying that Microsoft still has big, active developer communities, and that you shouldn't assume that just because you can't see them in San Francisco, that they are dead.

In fact, my comments were a lot like those that Microsoft VP Frank Shaw apparently made on the radio (http://www.kuow.org/program.php?id=20719) in response to this article:

"Microsoft has a lot of programs aimed at developers. Huge ecosystem."

And I believe I pointed out that a lot of those developer ecosystems were in markets where a lot of money is still being made, and said that it was important not just to pay attention to the hip, cool markets as if they were the only ones that mattered.

Ashlee also wrote:

"Mr. O’Reilly traces part of the problem back to the company’s developers. Microsoft spends a great deal of time and money shepherding a vast network of partner companies and people that base their livelihoods on improving and supporting Microsoft’s products.

"These software developers and technicians have bet their careers on Microsoft and largely benefited from that choice. In addition, they have helped keep Microsoft relevant during the various ups and downs in the technology market."

I don't remember saying anything of the kind. It may be true, but I am not the source. Nor was I the source for these paragraphs:

"But the recent crops of computer science graduates and start-ups have tended to move far afield from Microsoft, Mr. O’Reilly said.

"The vast majority of technology start-ups today rely on open-source software, distributed by Microsoft competitors, for the core parts of their technology infrastructure.

And so the technology-minded people coming out of college have started learning their craft on free software and betting their careers on non-Microsoft wares."

The only comment from myself that I recognized at all was this one:

"Mr. O’Reilly said the quick cancellation of the Kin may demonstrate that Microsoft has finally seen the depth of its woes when it comes to attracting consumers and younger audiences.

“This should be seen as a success for them,” Mr. O’Reilly said. “They grew fat and happy, but are now waking up to their different competitive position.”

I made a comparison to when Steve Jobs came back to Apple, and slashed existing products. Learning what is not working and responding quickly is a sign that a company is getting its mojo back.

There is certainly some truth to the assertions in the story. In my conversation with the author, I didn't disagree with all of his conclusions. I'm just saying that I was not the source for the various comments that were attributed to me.

I feel more than a little misrepresented. It's sad when the NYT uses "flamebait" techniques in its stories. Rather than real journalism, this felt like a reporter trying to create controversy rather than report news.

At Yahoo, Using Searches to Steer News Coverage
Jeremy W. Peters

Welcome to the era of the algorithm as editor.

For as long as hot lead has been used to make metal type, the model for generating news has been top-down: editors determined what information was important and then shared it with the masses.

But with the advent of technology that allows media companies to identify what kind of content readers want, that model is becoming inverted.

The latest and perhaps broadest effort yet in democratizing the news is under way at Yahoo, which on Tuesday will introduce a news blog that will rely on search queries to help guide its reporting and writing on national affairs, politics and the media.

Search-generated content has been growing on the Internet, linked to the success of companies like Associated Content, which Yahoo recently bought, and Demand Media, which has used freelance writers to create an online library of more than a million instructional articles.

But the use of search data has been limited more to the realm of “how to” topics like “How do I teach my dog sign language?” than questions about the news of the day like “Where does Elena Kagan stand on corporate campaign donations?”

Yahoo software continuously tracks common words, phrases and topics that are popular among users across its vast online network. To help create content for the blog, called The Upshot, a team of people will analyze those patterns and pass along their findings to Yahoo’s news staff of two editors and six bloggers.

The news staff will then use that search data to create articles that — if the process works as intended — will allow them to focus more precisely on readers.

“We feel like the differentiator here; what separates us from a lot of our competitors is our ability to aggregate all this data,” said James A. Pitaro, vice president of Yahoo Media. “This idea of creating content in response to audience insight and audience needs is one component of the strategy, but it’s a big component.”

In strictly economic terms, the power of technology that identifies reader trends is incredibly potent as a draw for advertisers. Yahoo paid more than $100 million this year for Associated Content, which pays writers small sums to write articles based on queries like “How do I tile a floor?” or “How do I make French toast?”

“They have a tremendous potential power to wring higher value advertisers out of targeted content,” said Ken Doctor, a media analyst and author of “Newsonomics: Twelve New Trends That Will Shape the News You Get.”

To demonstrate the power of search technology as editor, Mr. Pitaro is fond of telling a story about one of the most popular articles to appear on Yahoo’s sports news site during the 2008 Summer Olympics.

Yahoo had been monitoring search traffic patterns and noticed that its users kept trying to find out why divers would shower after they got out of the water. So Yahoo sports writers looked into the question and posted an item titled “The mystery of the showering divers.” (It turns out the warm water from the showers keeps divers’ muscles limber. Their muscles contract when they emerge from the warm water into the cool air.)

“So while our competition was covering a lot of the bigger, broader topics, we were covering topics that were a little bit more behind the scenes,” Mr. Pitaro said.

This niche approach to the news, filling in gaps in the coverage where other media outlets are not providing content, is the best way Mr. Pitaro feels The Upshot (at news.yahoo.com/upshot) can gain traction in a crowded media landscape.

“If you’re a news start-up, focusing on breadth would be the wrong way to go,” he said. “What we’re seeing is the market getting increasingly fragmented. And because of that you can survive by owning a niche category.”

The Yahoo model, which flies in the face of a centuries-old approach to disseminating the news, is certain to be viewed suspiciously by journalism purists.

“There’s obviously an embedded negative view toward using any type of outside information to influence coverage,” said Robertson Barrett, chief strategy officer of Perfect Market Inc., a company that helps news organizations make their content more detectable to search engine algorithms.

Mr. Barrett, a former publisher for the Web site of The Los Angeles Times, said many mainstream media outlets would start to come around to the idea if they did not feel pressured to let it affect their coverage.

“There’s a middle ground here in which publishers and news organizations can learn a lot about their audiences and what they want in real time and take that into account generally,” he said. “But that does not need to affect the specific story assignments.”

Yahoo news editors say they intend to be selective in using the data. The tricky question for Yahoo becomes how much it will insulate its editorial decision making from the very businesslike thinking that has made Associated Content and Demand Media successful.

“Essentially those in charge of analytics-driven content say, ‘These journalists, they only got it half right. Why produce all this stuff that doesn’t make money. Just produce the stuff that sells,’ ” Mr. Doctor said.

Asked whether he was concerned that signing up with Yahoo had rendered his career as an editor obsolete, The Upshot’s editor, Andrew Golis, laughed.

“I certainly don’t hope that,” Mr. Golis said, adding that he and Yahoo’s other journalists would use the search data as a supplemental tool. “The information is valuable because editors can integrate it into their decision making. It’s an asset. It’s a totally amazing and useful tool that we have at Yahoo. But it does not lead Yahoo editorial content.”

A Soft Spot for Circuitry
Amy Harmon

Nothing Eileen Oldaker tried could calm her mother when she called from the nursing home, disoriented and distressed in what was likely the early stages of dementia. So Ms. Oldaker hung up, dialed the nurses’ station and begged them to get Paro.

Paro is a robot modeled after a baby harp seal. It trills and paddles when petted, blinks when the lights go up, opens its eyes at loud noises and yelps when handled roughly or held upside down. Two microprocessors under its artificial white fur adjust its behavior based on information from dozens of hidden sensors that monitor sound, light, temperature and touch. It perks up at the sound of its name, praise and, over time, the words it hears frequently.

“Oh, there’s my baby,” Ms. Oldaker’s mother, Millie Lesek, exclaimed that night last winter when a staff member delivered the seal to her. “Here, Paro, come to me.”

“Meeaakk,” it replied, blinking up at her through long lashes.

Janet Walters, the staff member at Vincentian Home in Pittsburgh who recalled the incident, said she asked Mrs. Lesek if she would watch Paro for a little while.

“I need someone to baby-sit,” she told her.

“Don’t rush,” Mrs. Lesek instructed, stroking Paro’s antiseptic coat in a motion that elicited a wriggle of apparent delight. “He can stay the night with me.”

After years of effort to coax empathy from circuitry, devices designed to soothe, support and keep us company are venturing out of the laboratory. Paro, its name derived from the first sounds of the words “personal robot,” is one of a handful that take forms that are often odd, still primitive and yet, for at least some early users, strangely compelling.

For recovering addicts, doctors at the University of Massachusetts are testing a wearable sensor designed to discern drug cravings and send text messages with just the right blend of tough love.

For those with a hankering for a custom-built companion and $125,000 to spend, a talking robotic head can be modeled on the personality of your choice. It will smile at its own jokes and recognize familiar faces.

For dieters, a 15-inch robot with a touch-screen belly, big eyes and a female voice sits on the kitchen counter and offers encouragement after calculating their calories and exercise.

“Would you come back tomorrow to talk?” the robot coach asks hopefully at the end of each session. “It’s good if we can discuss your progress every day.”

Robots guided by some form of artificial intelligence now explore outer space, drop bombs, perform surgery and play soccer. Computers running artificial intelligence software handle customer service calls and beat humans at chess and, maybe, “Jeopardy!”

Machines as Companions

But building a machine that fills the basic human need for companionship has proved more difficult. Even at its edgiest, artificial intelligence cannot hold up its side of a wide-ranging conversation or, say, tell by an expression when someone is about to cry. Still, the new devices take advantage of the innate soft spot many people have for objects that seem to care — or need someone to care for them.

Their appearances in nursing homes, schools and the occasional living room are adding fuel to science fiction fantasies of machines that people can relate to as well as rely on. And they are adding a personal dimension to a debate over what human responsibilities machines should, and should not, be allowed to undertake.

Ms. Oldaker, a part-time administrative assistant, said she was glad Paro could keep her mother company when she could not. In the months before Mrs. Lesek died in March, the robot became a fixture in the room even during her daughter’s own frequent visits.

“He likes to lie on my left arm here,” Mrs. Lesek would tell her daughter. “He’s learned some new words,” she would report.

Ms. Oldaker readily took up the game, if that is what it was.

“Here, Mom, I’ll take him,” she would say, boosting Paro onto her own lap when her mother’s food tray arrived.

Even when their ministrations extended beyond the robot’s two-hour charge, Mrs. Lesek managed to derive a kind of maternal satisfaction from the seal’s sudden stillness.

“I’m the only one who can put him to sleep,” Mrs. Lesek would tell her daughter when the battery ran out.

“He was very therapeutic for her, and for me too,” Ms. Oldaker said. “It was nice just to see her enjoying something.”

Like pet therapy without the pet, Paro may hold benefits for patients who are allergic, and even those who are not. It need not be fed or cleaned up after, it does not bite, and it may, in some cases, offer an alternative to medication, a standard recourse for patients who are depressed or hard to control.

In Japan, about 1,000 Paros have been sold to nursing homes, hospitals and individual consumers. In Denmark, government health officials are trying to quantify its effect on blood pressure and other stress indicators. Since the robot went on sale in the United States late last year, a few elder care facilities have bought one; several dozen others, hedging their bets, have signed rental agreements with the Japanese manufacturer.

But some social critics see the use of robots with such patients as a sign of the low status of the elderly, especially those with dementia. As the technology improves, argues Sherry Turkle, a psychologist and professor at the Massachusetts Institute of Technology, it will only grow more tempting to substitute Paro and its ilk for a family member, friend — or actual pet — in an ever-widening number of situations.

“Paro is the beginning,” she said. “It’s allowing us to say, ‘A robot makes sense in this situation.’ But does it really? And then what? What about a robot that reads to your kid? A robot you tell your troubles to? Who among us will eventually be deserving enough to deserve people?”

But if there is an argument to be made that people should aspire to more for their loved ones than an emotional rapport with machines, some suggest that such relationships may not be so unfamiliar. Who among us, after all, has not feigned interest in another? Or abruptly switched off their affections, for that matter?

In any case, the question, some artificial intelligence aficionados say, is not whether to avoid the feelings that friendly machines evoke in us, but to figure out how to process them.

“We as a species have to learn how to deal with this new range of synthetic emotions that we’re experiencing — synthetic in the sense that they’re emanating from a manufactured object,” said Timothy Hornyak, author of “Loving the Machine,” a book about robots in Japan, where the world’s most rapidly aging population is showing a growing acceptance of robotic care. “Our technology,” he argues, “is getting ahead of our psychology.”

More proficient at emotional bonding and less toylike than their precursors — say, Aibo the metallic dog or the talking Furby of Christmas crazes past — these devices are still unlikely to replace anyone’s best friend. But as the cost of making them falls, they may be vying for a silicon-based place in our affections.

Strangely Compelling

Marleen Dean, the activities manager at Vincentian Home, where Mrs. Lesek was a resident, was not easily won over. When the home bought six Paro seals with a grant from a local government this year, “I thought, ‘What are they doing, paying $6,000 for a toy that I could get at a thrift store for $2?’ ” she said.

So she did her own test, giving residents who had responded to Paro a teddy bear with the same white fur and eyes that also opened and closed. “No reaction at all,” she reported.

Vincentian now includes “Paro visits” in its daily roster of rehabilitative services, including aromatherapy and visits from real pets. Agitated residents are often calmed by Paro; perpetually unresponsive patients light up when it is placed in their hands.

“It’s something about how it shimmies and opens its eyes when they talk to it,” Ms. Dean said, still somewhat mystified. “It seems like it’s responding to them.”

Even when it is not. Part of the seal’s appeal, according to Dr. Takanori Shibata, the computer scientist who invented Paro with financing from the Japanese government, stems from a kind of robotic sleight of hand. Scientists have observed that people tend to dislike robots whose behavior does not match their preconceptions. Because the technology was not sophisticated enough to conjure any animal accurately, he chose one that was unfamiliar, but still lovable enough that people could project their imaginations onto it. “People think of Paro,” he said, “as ‘like living.’ ”

It is a process he — and others — have begun calling “robot therapy.”

At the Veterans Affairs Medical Center in Washington on a recent sunny afternoon, about a dozen residents and visitors from a neighboring retirement home gathered in the cafeteria for their weekly session. The guests brought their own slightly dingy-looking Paros, and in wheelchairs and walkers they took turns grooming, petting and crooning to the two robotic seals.

Paro’s charms did not work on everyone.

“I’m not absolutely convinced,” said Mary Anna Roche, 88, a former newspaper reporter. The seal’s novelty, she suggested, would wear off quickly.

But she softened when she looked at her friend Clem Smith running her fingers through Paro’s fur.

“What are they feeding you?” Ms. Smith, a Shakespeare lover who said she was 98, asked the seal. “You’re getting fat.”

A stickler for accuracy, Ms. Roche scolded her friend. “You’re 101, remember? I was at your birthday!”

The seal stirred at her tone.

“Oh!” Ms. Roche exclaimed. “He’s opening his eyes.”

As the hour wore on, staff members observed that the robot facilitated human interaction, rather than replaced it.

“This is a nice gathering,” said Philip Richardson, who had spoken only a few words since having a stroke a few months earlier.

Dorothy Marette, the clinical psychologist supervising the cafeteria klatch, said she initially presumed that those who responded to Paro did not realize it was a robot — or that they forgot it between visits.

Yet several patients whose mental faculties are entirely intact have made special visits to her office to see the robotic harp seal.

“I know that this isn’t an animal,” said Pierre Carter, 62, smiling down at the robot he calls Fluffy. “But it brings out natural feelings.”

Then Dr. Marette acknowledged an observation she had made of her own behavior: “It’s hard to walk down the hall with it cooing and making noises and not start talking to it. I had a car that I used to talk to that was a lot less responsive.”

Accepting a Trusty Tool

That effect, computer science experts said, stems from what appears to be a basic human reflex to treat objects that respond to their surroundings as alive, even when we know perfectly well that they are not.

Teenagers wept over the deaths of their digital Tamagotchi pets in the late 1990s; some owners of Roomba robotic vacuum cleaners are known to dress them up and give them nicknames.

”When something responds to us, we are built for our emotions to trigger, even when we are 110 percent certain that it is not human,” said Clifford Nass, a professor of computer science at Stanford University. “Which brings up the ethical question: Should you meet the needs of people with something that basically suckers them?”

An answer may lie in whether one signs on to be manipulated.

For Amna Carreiro, a program manager at the M.I.T. Media Lab who volunteered to try a prototype of Autom, the diet coach robot, the point was to lose weight. After naming her robot Maya (“Just something about the way it looked”) and dutifully entering her meals and exercise on its touch screen for a few nights, “It kind of became part of the family,” she said. She lost nine pounds in six weeks.

Cory Kidd, who developed Autom as a graduate student at M.I.T., said that eye contact was crucial to the robot’s appeal and that he had opted for a female voice because of research showing that people see women as especially supportive and helpful. If a user enters an enthusiastic “Definitely!” to the question “Will you tell me what you’ve eaten today?” Autom gets right down to business. A reluctant “If you insist” elicits a more coaxing tone. It was the blend of the machine’s dispassion with its personal attention that Ms. Carreiro found particularly helpful.

“It would say, ‘You did not fulfill your goal today; how about 15 minutes of extra walking tomorrow?’ ” she recalled. “It was always ready with a Plan B.”

Aetna, the insurance company, said it hoped to set up a trial to see whether people using it stayed on their diets longer than those who used other programs when the robot goes on sale next year.

Of course, Autom’s users can choose to lie. That may be less feasible with an emotion detector under development with a million-dollar grant from the National Institute on Drug Abuse that is aimed at substance abusers who want to stay clean.

Dr. Edward Boyer of the University of Massachusetts Medical School plans to test the system, which he calls a “portable conscience,” on Iraq veterans later this year. The volunteers will enter information, like places or people or events that set off cravings, and select a range of messages that they think will be most effective in a moment of temptation.

Then they don wristbands with sensors that detect physiological information correlated with their craving. With a spike in pulse not related to exertion, for instance, a wireless signal would alert the person’s cellphone, which in turn would flash a message like “What are you doing now? Is this a good time to talk?” It might grow more insistent if there was no reply. (Hallmark has been solicited for help in generating evocative messages.)

With GPS units and the right algorithms, such a system could tactfully suggest other routes when recovering addicts approached places that hold particular temptation — like a corner where they used to buy drugs. It could show pictures of their children or play a motivational song.

“It works when you begin to see it as a trustworthy companion,” Dr. Boyer said. “It’s designed to be there for you.”

ATM Vendors Threaten Researcher, Stop His Presentation on ATM Flaws

In an unexpected turn of events, a presentation about "The Underground Economy" by Italian white hat hacker and security expert Raoul Chiesa at the Hack In The Box conference held last week in Amsterdam, was replaced at the last minute with a presentation on "Side Channel Analysis on Embedded Systems" by Job de Haas.

According to Softpedia, the reason behind this cancellation was the fact that the originally scheduled presentation covers details of various techniques and exploits of vulnerabilities that cyber criminals use to break into ATM machines.

As you can surmise, ATM vendors weren't too happy about that fact and employed legal means to prevent Chiesa from addressing the conference crowd.

Even though this is not the first time that ATM vendors prevented a security researcher to publicly disclose findings about flaws in their devices at a conference, this instance is really surprising, since Chiesa held this same presentation at a couple of security conferences already, and the slides he employed are also available online.

What the vendors hoped to accomplish with this threatening approach is anyone's guess. The organizer of the conference also pointed out that the vendors had plenty of time to patch the vulnerabilities, since they have been notified of them a long time ago.

This unexpected development makes me wonder if Barnaby Jack's previously thwarted demonstration will actually take place at this year's Black Hat USA taking place later this month. Will the ATM vendors try to block that one at the last minute - again?

TSA To Block Websites With “Controversial Opinions”

Move to shut down free speech on the Internet accelerates
Paul Joseph Watson

The Transportation Security Administration will block all websites that contain “controversial opinion” from its federal computers in the latest example of how Internet censorship is expanding in both the private and public sector as the federal government prepares to push through a power grab that will empower President Obama to shut down the world wide web with an emergency decree.

“The Transportation Security Administration (TSA) is blocking certain websites from the federal agency’s computers, including halting access by staffers to any Internet pages that contain a “controversial opinion,” according to an internal email obtained by CBS News.”

The new rules came into force on July 1, and prevent TSA employees from accessing such content, though what is deemed “controversial opinion” is not explained. Undoubtedly, the ban list will include websites which specialize in criticism of the government and federal agencies.

The move to regulate and stifle free speech on the world wide web is accelerating after Senator Joe Lieberman introduced the Protecting Cyberspace as a National Asset Act, legislation that will hand Obama a figurative ‘kill switch’ to shut down certain parts of the Internet under the pretext of a national emergency. The bill was approved by the Senate Homeland Security and Governmental Affairs Committee and now awaits a full Senate vote.

Internet censorship is expanding by stealth across numerous private and public network hubs. We routinely receive emails from visitors alarmed at the fact that their local library, university or transport center has blocked Alex Jones’ websites under the justification that they contain “hate speech”. Hate speech is being cited as an excuse to bar access to material critical of the state.

Indeed, at London’s St. Pancras station, one of the busiest international transport hubs in the world, Prison Planet.com, Infowars.com, and even mildly political websites are all censored on the facility’s free wi-fi network. In Communist China, where the state blocks most political websites, Alex Jones’ content is still accessible. In this instance, the Internet censorship policies of so-called free western nations are more draconian than those employed by the Chinese.

The move to censor certain websites is likely to be part of an effort to restrict access to stories about TSA agents abusing their power, examples of which have skyrocketed in recent years. This is all about preventing federal employees from figuring out that their entire career is nothing more than acting as goon enforcers for the state as America sinks further into tyranny.

An epidemic of TSA abuse at the nation’s airports has spread since 9/11, with TSA agents showing a penchant for harassing the easiest targets, from the elderly, to pregnant women, to the severely handicapped.

A large number of people have simply refused to travel to America anymore because entering the country is like trying to get into the old East Germany. This is killing the tourism industry and costing hundreds of millions of dollars each year.

A 2006 investigation by the Discover America Partnership found that tourism to America had sunk due to “a climate of fear and frustration that is turning away foreign business and leisure travelers from visiting the United States and damaging America’s image abroad.”

No less than a third of tourists vowed never to return to America after experiencing the treatment of Homeland Security officials at ports of entry. By early 2007, the U.S. had lost around 60 million visitors as a result of the stifling and intrusive security measures implemented since 9/11.

'Robin Sage' Profile Duped Military Intelligence, IT Security Pros

Social networking experiment of phony female military intelligence profile fooled even the most security-savvy on LinkedIn, Facebook, Twitter -- and also led to the leakage of sensitive military information
Kelly Jackson Higgins

Seasoned red team hacker Chris Nickerson initially accepted Robin Sage's LinkedIn invitation because several of his colleagues had, but after making a few inquiries he realized something was fishy about "Robin," a twenty-something woman who purportedly worked for the Naval Network Warfare Command. "Within an hour, I started asking around, 'Hey did you get a friend request from Robin Sage?' ... and [friends] were saying, 'I thought you knew her.' I knew something weird was going on," Nickerson says.

So Nickerson started hammering away at Robin on Twitter, and quickly figured out it was a fellow red team hacker behind the phony persona. But not everyone caught on as quickly to the phony profile as Nickerson: Robin actually duped an Army Ranger into friending her. The Ranger then inadvertently exposed information about his coordinates in Afghanistan to Robin with his uploaded photos from the field that contained GeoIP data from the camera.

"You could see them talking about where they were going and where they were in Afghanistan and Iraq ... some were uploading pictures with geolocation information, and we were able to see them," says Thomas Ryan, the mastermind behind the social network experiment and co-founder and managing partner of cyber operations and threat intelligence for Provide Security, who will present the findings later this month at Black Hat USA in his "Getting In Bed With Robin Sage" talk.

Ryan says Robin's Facebook profile was able to view coordinates information on where the troops were located. "If she was a terrorist, you would know where different [troops'] locations were," Ryan says.

Robin Sage gained a total of about 300 friends on LinkedIn, counting those who came and went, he says. All three of the phony woman's social networking accounts remain active -- the LinkedIn profile currently has 148 connections, the Facebook profile has 110, and the Twitter account has 141 followers. Ryan officially ran the experiment for 28 days starting in late December and ending in January of this year.

Among Robin's social networking accomplishments: She scored connections with people in the Joint Chiefs of Staff, the CIO of the NSA, an intelligence director for the U.S. Marines, a chief of staff for the U.S. House of Representatives, and several Pentagon and DoD employees. The profiles also attracted defense contractors, such as Lockheed Martin, Northrop Grumman, and Booz Allen Hamilton.

Lockheed and other firms made job offers to Robin, some inviting her to dinner to discuss employment prospects. "I was surprised at how people in her same command friended her -- people actually in the same command and the same building," Ryan says.

Among the security experts who Ryan says initially accepted Robin's invitations were Lares Consulting's Nickerson, Jeremiah Grossman, CTO and co-founder at WhiteHat Security, and Marc Maiffret, who says he figured it out pretty quickly because Ryan used graphics in the profiles that he also uses for his paintball group. Ironically, the once-infamous social engineer Kevin Mitnick is listed as one of "her" connections on LinkedIn as well.

Grossman says he coincidentally was writing a Facebook bot when Robin's friend request showed up on his placeholder Facebook profile, which he doesn't actually use. The bot program then accepted Robin as a friend. "I look at Facebook and LinkedIn as public record," Grossman says. "What difference does it make if you vet them or not -- you shouldn't be disclosing" private information on these profiles, he says.

Meanwhile, the real woman in the Robin Sage LinkedIn, Facebook, and Twitter profile photos has agreed to show up at Black Hat USA later this month to introduce Ryan for his presentation. Ryan says he confirmed that using her photo for the social network accounts was legal, as long as none of her personally identifiable information was used, and it was not. The woman apparently posed for photo shoots for a pornographic site, according to Ryan. He found the woman's photo by searching "emo chick" via Google, a reference to the punk/indie style and music.

"I created a whole profile on that, so that nothing could link back to who she really was," he says. He set up a Blogger account under the name Robin Sage, named after the U.S. Army Special Forces training exercise. Robin Sage is the final phase of special forces training before becoming a Green Beret -- but even that apparently didn't tip off some military and intelligence community people who accepted LinkedIn invitations or Facebook friend requests from her.

He purposely left several clues that Robin was a fake, including choosing a woman who appeared to be Eastern European and a potential spy, he says. He built a prestigious resume for Robin: a degree from MIT, an internship at the National Security Agency, and her current position at the Naval Network Warfare Command. Her address was that of BlackWater, the infamous military contractor.

Whenever someone got suspicious and questioned any of Robin's credentials or information, Ryan says he would change it on the fly. He had the perfect comeback for hesitant LinkedIn members: "'Don't you remember we partied together at Black Hat?'" That was usually all it took for them to accept the invitation, he says. Ryan's social networking experiment isn't the first of its kind, however. Researchers Nathan Hamiel and Shawn Moyers two years ago at Black Hat demonstrated how they successfully impersonated security icon Marcus Ranum on the social networking site LinkedIn, even fooling Ranum's sister into connecting to the phony Ranum profile.

Charges Announced for Soldier Accused of Leaking Video
Steven Lee Myers

An Army soldier in Iraq who was arrested for leaking a video of a deadly American helicopter attack here in 2007 has also been charged with downloading more than 150,000 highly classified diplomatic cables that could, if made public, reveal the inner workings of American embassies around the world, the military here announced on Tuesday.

The full contents of the cables remain unclear but according to formal charges filed on Monday, it appeared that a disgruntled soldier working at a remote base east of Baghdad gathered some of the most guarded, if not always scandalous secrets of American diplomacy. He disclosed at least 50 of the cables "to a person not entitled to receive them."

With the charges, a case that stemmed from the furor over a graphic and fiercely contested video of an American helicopter killing 12 people, including a reporter and a driver for Reuters, mushroomed into a far more extensive and potentially embarrassing leak. The charges cited only one cable by name, "Reykyavik 13," which appeared to be one made public by Wikileaks.org, a furtive Web site devoted to disclosing the secrets of governments and corporations. The Web site decoded and in April made public an edited version of the helicopter attack in a film it called "Collateral Murder."

In the cable, dated January 13, the American deputy chief of mission, Sam Watson, detailed private discussions he held with Iceland’s leaders over a referendum on whether to repay losses from a bank failure, including a frank assessment that Iceland could default in 2011. (The referendum failed, but negotiations continue.)

Wikileaks, which reportedly operated in the country for a time, disclosed a second cable from Iceland in March profiling the country’s leaders, including Prime Minister Johanna Sigurdardottir.

Although hardly sensational in tone, the cable does reveal a complaint over the "alleged use of Icelandic airspace by CIA-operated planes" by the Icelandic ambassador to the United States, Albert Jonsson, who is described as "prickly but pragmatic." Such are the sorts of assessments diplomats go to great lengths to keep private.

Wikileaks has not acknowledged receiving the cables or video from the analyst, Private First Class Bradley E. Manning, 22, whose case has been the subject of vigorous debate between defenders and critics. Private Manning, who served with the Second Brigade of the 10th Mountain Division, based at Contingency Operating Station Hammer, was arrested in May and transferred to a military detention center in Kuwait after allegedly revealing his activities in online chats with a former computer hacker, who turned him in to the authorities.

Private Manning now faces an Article 32 investigation, the military’s equivalent of a civilian grand jury, into charges that he mishandled classified information "with reason to believe the information could cause injury to the United States."

That investigation could lead to administrative punishments or more likely, given the gravity of the charges, a court martial.

Officially he has been charged with four counts of violating Article 92 of the Uniform Code of Military Justice for disobeying an order or regulation and eight counts of violating Article 134, a general charge for misconduct, which in this case involved breaking Federal laws against disclosing classified information.

It is not clear what happened to the vast trove of diplomatic cables Private Manning collected, and whether any others would make their way into the public domain. The formal charges, though, suggested an extensive effort by military investigators to scour the official and personal computers he used to trace the recipients.

The charges cited unauthorized handling of classified information from Nov. 19, 2009 until May 27, two days before his detention and well after the leak of the helicopter video. The charges accused him of using the classified network to obtain the "Reykjavik 13" cable on the day the one disclosed by Wikileaks was written.

He was also charged with downloading a classified PowerPoint presentation, one of those heavily used by the American military, but what secrets it contained remained unknown.

Andrian Lamo, the former hacker who reported Private Manning to the authorities, has said they struck up on on-line friendship in which the private complained of personal discontent with the military and American foreign policies.

Because the investigation continues, military officials here would not elaborate on the case against Private Manning or his motives. The United States Embassy did not respond to a query. One senior commander, though, speaking on condition of anonymity because of the investigation, said, "It appeared he had an agenda."

Loophole May Have Aided Theft of Classified Data
Thom Shanker

The soldier accused of downloading a huge trove of secret data from military computers in Iraq appears to have exploited a loophole in Defense Department security to copy thousands of files onto compact discs over a six-month period. In at least one instance, according to those familiar with the inquiry, the soldier smuggled highly classified data out of his intelligence unit on a disc disguised as a music CD by Lady Gaga.

Criminal charges were filed this week against the soldier, Pfc. Bradley E. Manning, 22, who was accused of downloading more than 150,000 diplomatic cables, as well as secret videos and a PowerPoint presentation. Since his arrest in May, with initial accounts blaming him for leaking video of a deadly American helicopter attack in Baghdad in 2007, officials have sought to determine how he could have removed voluminous amounts of secret data without being caught.

A Defense Department directive from November 2008 prohibits the use of small thumb drives or larger external memory devices on any of the estimated seven million computers operated by the Pentagon and armed services. The order was issued to forestall the accidental infection of national security computer networks by viruses — and the intentional removal of classified information.

Defense Department computers have their portals disabled to prevent the use of external memory devices that are ubiquitous in homes, offices and schools, officials said. A recent amendment to the order allows the rare use of thumb drives, but only with official approval as required by a current mission.

But the Pentagon directive and the amendment did not ban the use of compact-disc devices, which are built into many computers and therefore not included in the prohibition against the use of external memory devices.

According to Pentagon officials and one former hacker who has communicated with Private Manning, he appears to have taken compact discs that can accept text, video and other data files into an intelligence center in the desert of eastern Iraq to copy and remove the classified information.

He was able to avoid detection not because he kept a poker face, they said, but apparently because he hummed and lip-synched to Lady Gaga songs to make it appear that he was using the classified computer’s CD player to listen to music.

Adrian Lamo, a well-known former hacker, had traded electronic messages in which Private Manning described his unhappiness with the Army — and, Mr. Lamo said, his activities downloading classified data.

Mr. Lamo said Private Manning described how he had used compact discs capable of storing data, but tucked inside recognizable music CD cases, “to bring the data out of the secure room.”

“He indicated he disguised one as a Lady Gaga CD,” Mr. Lamo said Thursday in a telephone interview. “He said he lip-synched to blend in.”

The four pages of official charges against Private Manning accuse him of downloading and removing the classified data from last November to May. The charges say he also loaded unauthorized software onto a computer linked to the military’s classified computer network, called the SIPR-Net. The charges do not explain the significance of that action, nor how it might have aided his alleged effort to download classified files.

In downloading more than 150,000 diplomatic cables, the charges state, Private Manning did “intentionally exceed his authorized access on” the SIPR-Net. This statement appears to be at least a partial explanation of how a soldier assigned to an Army brigade outpost in eastern Iraq was able to gain access to classified diplomatic cables on a variety of unrelated subjects.

At a Pentagon news conference on Thursday, Defense Secretary Robert M. Gates and Adm. Mike Mullen, the chairman of the Joint Chiefs of Staff, said they would reserve judgment on whether to order a sweeping review of security measures until it was determined whether the actions of which Private Manning is accused represent a broader problem.

“What this illustrates is the incredible amount of trust we place in even our most junior men and women in uniform,” Mr. Gates said. “We have over two million men and women in uniform, and I believe we should always err on the side of trusting them because virtually all of them — not 100 percent, but nearly 100 percent — give us reasons every single day to continue trusting them.”

Pentagon officials said they expected investigators to review the actions of Private Manning’s supervisors to determine whether enforcement of security rules was lax in a remote outpost where soldiers are assigned to duty at computers virtually around the clock.

Another line of inquiry is expected to look at whether digital red flags were raised, or should have been raised, by Private Manning’s actions, including the accusation that he spent time downloading information from classified databases not directly related to the mission of his unit, the Second Brigade of the 10th Mountain Division, based at Contingency Operating Station Hammer east of Baghdad.

Steven Lee Myers contributed reporting from Baghdad.

How Even the Dumbest Russian Spies can Outwit the NSA
Jon Stokes

By now, you've no doubt heard of the Russian spy ring that was recently busted in the US, and you've also probably heard that they apparently weren't very bright. The complaint filed in their case documents a litany of unprofessionalism and carelessness, from leaving written passwords out in the open to asking a federal agent posing as a fellow spy to troubleshoot a laptop without even bothering to check back with HQ to see if the "spy" was legit.

But as incompetent as these spies were, they were bright enough to at least partially outwit the large-scale e-mail snooping efforts of the NSA's backbone taps and multibillion-dollar datacenters. How? By using steganography to encode secret text messages in image files, which they then placed on websites.

After searching one spy's apartment, law enforcement agents found a computer and made a copy of its hard drive for later analysis. On the hard drive they found an address book containing website links, which the agents visited and downloaded images from.
The complaint notes that "these images appear wholly unremarkable to the naked eye. But these images (and others) have been analyzed using the Steganography Program. As a result of this analysis, some of the images have been revealed as containing readable text files."

The steganography program used to decode the images was also on one of the hard drives copied in the search; it was this hard drive which was password protected, and which the agents were able to unlock because the 27-character password was written down on a piece of paper and left lying out in the open on a desk. Clearly, the spies would have been better off with a much shorter password that could have been memorized versus a too-long one that they had to write down and keep nearby.

But "don't write down your passwords" and "don't pick passwords that you have to write down" are the two least interesting lessons to draw from the spies' comical ineptitude. The deeper lesson is that, however dumb these spies were, the real joke here is on US taxpayers.

This technique of using steganography to hide messages in images published online isn't particularly brilliant, and it's simple enough to execute that these apparent nincompoops could manage it. Yet our government spends tens of billions of dollars on networking monitoring hardware and data-mining efforts that are aimed at vacuuming up our electronic communications and automatically parsing them for terrorist-speak. All of this technology would fail to detect the messages that these spies sent—either their contents or the simple fact of their existence. The Russian spies' online messaging activity would look to any automated system like perfectly normal HTTP traffic.

The ultimate point here is one that I've made again and again: it's very, very hard for data mining techniques to extract truly reliable signals from even a relatively high-quality, carefully curated dataset. But when a tiny fraction of a giant dataset has been maliciously and stealthily manipulated by humans who, even at their most incompetent, are still smarter than computers, then the GIGO rule kicks in and you're getting garbage without knowing it.

As this Christian Science Monitor story points out, it's not yet known how these spies were caught. But unless they were dumb enough talk spy stuff via regular e-mail, despite having access to a far superior means of message passing, then we can be fairly certain about how they were not caught: by the NSA's expensive, constitution-busting data-mining efforts.

Crack the Code in Cyber Command’s Logo
Noah Shachtman

The U.S. military’s new Cyber Command is headquartered at Ft. Meade, Maryland, one of the military’s most secretive and secure facilities. Its mission is largely opaque, even inside the armed forces. But the there’s another mystery surrounding the emerging unit. It’s embedded in the Cyber Command logo.

On the logo’s inner gold ring is a code: 9ec4c12949a4f31474f299058ce2b22a

“It is not just random numbers and does ‘decode’ to something specific,” a Cyber Command source tells Danger Room. “I believe it is specifically detailed in the official heraldry for the unit symbol.”

“While there a few different proposals during the design phase, in the end the choice was obvious and something necessary for every military unit,” the source adds. “The mission.”

With that hint in hand, go crack this code open. E-mail us your best guess, or leave it in the comments below. Our Cyber Command source will confirm the right answer. And the first person to get it gets his/her choice of a Danger Room T-shirt or a ticket to the International Spy Museum.

Keeping Their Enemies Closer
Daniela Altimari

That Yale student in a dark suit carrying a video camera and trailing Democratic candidate for governor Dan Malloy?

He's not a journalist, Malloy staff member or supporter.

He's a tracker, and he works for Democratic opponent Ned Lamont.

It's his job to document everything Malloy says and does in public in hopes of capturing a misstatement, an empty boast, an inopportune turn of phrase or some other gotcha! moment to post to YouTube or feature in a TV ad.

"From the minute Dan gets out of the car to the minute he gets back into the car, he's glued to him,'' Malloy campaign manager Roy Occhiogrosso said. "He was literally waiting outside the men's room for Dan the other day.''

The Malloy campaign has a tracker on Lamont, too.

"Ned usually walks up and says 'hey' to him,'' said Lamont campaign manager Joe Abbey. "They're not bad people, they're just doing their jobs."

Waiting For Blunders

Trackers have been a key component of many modern political campaigns since at least 2006, when former Virginia Sen. George Allen used the slur "macaca" to identify a young tracker for the opposition. The comment was caught on video and it helped sink Allen's chances for re-election.

Several Connecticut campaigns, notably the contest between Lamont and Sen. Joseph I. Lieberman, experimented with trackers in 2006. But the 2010 election cycle, with its high-stakes races for governor and U.S. Senate — coupled with the advent of good, cheap cameras and a 24/7 news cycle that feeds on gotchas — marks the first time that trackers have been deployed on a broad scale in this state. Nearly all of the candidates running for major office are employing them this year.

"Campaigns changed forever whenever the cellphone manufacturers began putting cameras on their products,'' said Ed Patru, a spokesman for Republican U.S. Senate candidate Linda McMahon. "We assume everything is always being captured and, in fact, most campaigns operate under that assumption."

Yet politicians continue to get tripped up in the presence of a camera. Last week, Republican National Committee Chairman Michael Steele found himself a target when he told an audience at a private fundraiser in Noank that the war in Afghanistan was "a war of Obama's choosing." He also suggested that the current strategy is not winnable, a view that most members of his own party do not support.

It was all caught on video by the state Democratic Party's tracker, who was watching from a part of the restaurant that remained open to the public.

Hoping to enlist a vast army with cellphones and Flip cameras to document more such moments, the Democratic National Committee has put out a call for citizen trackers. Dubbed the Accountability Project, this new initiative allows anyone to upload video from the campaign trail; the more embarrassing, the better. ( Republicans only, of course.)

"People need to be held accountable for what they're saying,'' said Shauna Daly, the DNC's director of research. "There are certain moments of truth when something crystallizes and a veneer breaks down.''

Running for office can be tedious work, and blunders happen. Attorney General and Democratic nominee for U.S. Senate Richard Blumenthal said he misspoke when he incorrectly stated that he served in Vietnam. Blumenthal's comments were caught on video, although not by a tracker.

Fergus Cullen, the former chairman of the Republican Party in New Hampshire who now leads the Yankee Institute for Public Policy in Hartford, said he worries that the rise of trackers will lead to overly cautious candidates who hew to talking points and avoid saying anything unscripted.

"It has the negative effect of producing more robotic candidates who can never give you a candid response because they're always afraid of saying the wrong things,'' Cullen said. "You get these bland, anodyne comments from candidates who don't feel like they can have an honest conversation with voters, and I think that's unfortunate."

The McMahon campaign's trackers assigned to Blumenthal hope to catch the candidate in an "unguarded moment," Patru said. "When and if he ever does, we'd like to capture it. Our trackers get a lollipop if they ever manage to record Blumenthal taking a stand on a policy issue. "

The Blumenthal campaign does not have a tracker following McMahon, but the state Democratic Party does. "Trackers are part of campaigns now,'' said Kate Hansen, a spokeswoman for state Democrats. "New technologies mean more information can be collected and shared faster than ever – you hope with an eye toward old-fashioned values of honesty and respect, both in the gathering and sharing of that information."

In The Shadows

Dan Malloy held a press conference on education last week at the Legislative Office Building. Seated before him were the members of the Capitol press corps, a dozen or so advocates, and a handful of handlers and staff members. Standing squarely in the front row, next to a video camera on a tripod, was Lamont tracker Steven Winter.

At one point, Malloy couldn't see the reporter asking him a question because Winter was blocking his line of sight. "I'm stepping over here because I'm trying to see around you,'' he said.

There's nothing particularly cloak-and-dagger about the way the trackers go about their jobs: Everyone on the campaign trail knows who they are and why they are there.

Yet most prefer to operate in the shadows. The Malloy, Lamont, McMahon and state Democratic Party all rebuffed requests to interview their trackers, who are generally junior staff members. The job is fairly tedious: How many times can you hear the same stump speech?

The DNC advises its citizen trackers that they are there to "document not to disturb or disrupt the event." Private fundraisers and the like are supposed to be off-limits, although Steele's controversial remarks on Afghanistan at the Noank fundraiser were apparently considered fair game.

Cullen said he tried to hammer out ground rules for trackers when he was GOP chairman in New Hampshire. One candidate sent a tracker to an event at which the 70-year-old mother of the opposing candidate was being honored. "I thought that was going into the area of harassment,'' Cullen said. "What's next? Are you going to start following a candidate's children around?"

Still, the campaigns say the work is important.

"It's about accountability,'' said Joe Abbey, Lamont's campaign manager. "It's good for our campaign to know what our opponents are saying and it's good for the public at large. … There's more sunlight and more accountability, which is never a bad thing."
Added Ashley Maagero, campaign manager for Republican gubernatorial candidate R. Nelson "Oz" Griebel, "We welcome the opportunity to have a tracker follow us around. … If you're transparent and accessible, it shouldn't be a problem."

Microsoft Opens Source Code to Russian Secret Service
Tom Espiner

Microsoft has signed a deal to open its Windows 7 source code up to the Russian intelligence services.

Russian publication Vedomosti reported on Wednesday that Microsoft had also given the Russian Federal Security Service (FSB) access to Microsoft Windows Server 2008 R2, Microsoft Office 2010 and Microsoft SQL Server source code, with hopes of improving Microsoft sales to the Russian state.

The agreement will allow state bodies to study the source code and develop cryptography for the Microsoft products through the Science-Technical Centre 'Atlas', a government body controlled by the Ministry of Communications and Press, according to Vedomosti.

Microsoft Russia president Nikolai Pryanishnikov told Vedomosti that employees of Atlas and the FSB will be able to share conclusions about Microsoft products.

The agreement is an extension to a deal Microsoft struck with the Russian government in 2002 to share source code for Windows XP, Windows 2000 and Windows Server 2000, said Vedomosti.

A senior security source with links to the UK government told ZDNet UK on Wednesday that the 2002 deal was part of Microsoft's Government Security Program. Nato also signed up, said the source. Having a number of different governments with access to Microsoft code meant it was possible that a government could find holes in the code and use it to exploit another nation-state's systems, said the source.

Cambridge University security expert Richard Clayton told ZDNet UK on Thursday that opening up source code leads to a complex security situation. While a view of the code could enable a government to find security holes that the state could use to launch attacks against other nation states, it is possible to find holes in software without having access to the source code, said Clayton.

"If a government has the source code it can find different sorts of security vulnerabilities and perhaps exploit them, [but] it's unclear whether access to the source code makes people better or worse off," said Clayton.

A number of different factors made the situation complicated, said Clayton. Access to the code could allow close analysis, which would enable the discovery of holes such as buffer overflow flaws, but equally it is possible to run a fuzzing program which throws random data at parts of an operating system or software to find different vulnerabilities.

While access to the code can enable pre-emptive patching before an attack, nation states would be able to tell if another government was patching its networks, said Clayton.

"Should you immediately patch the system, in which case people will notice the Russians have patched their systems?" said Clayton. "Or alternatively you could report the vulnerability to Redmond [Microsoft headquarters], or should you use [the hole] to attack your enemies?"

Clayton said that there were tens of thousands of bugs in Microsoft products, in part due to the sheer volume of source code. A government could not hope to patch them all, said Clayton, while an attacker only has to find one hole and exploit it successfully to gain access to systems.

"It's completely asymmetrical," said Clayton.

The Office of Cyber Security, which oversees the UK government cyber-attack and defence capability, had not responded to a request for comment at the time of writing.

A senior Whitehall source told ZDNet that Microsoft's decision to open its source code to various governments had been a commercial decision.

Microsoft had not responded to requests for comment at the time of writing.

Credit Card Hackers Visit Hotels All Too Often
Joe Sharkey

HERE’S something that the struggling hotel sector prefers not to spotlight: it is a favorite target of hackers.

A study released this year by SpiderLabs, a part of the data-security consulting company Trustwave, found that 38 percent of the credit card hacking cases last year involved the hotel industry. The sector was well ahead of the financial services industry (19 percent), retailing (14.2 percent), and restaurants and bars (13 percent).

Why hotels? Well, to paraphrase the bank robber Willie Sutton, hackers hit hotels because that is where the richest vein of personal credit card data is. At hotels with inadequate data security, “the greatest amount of credit card information can be obtained using the most simplified methods,” said Anthony C. Roman, a private security investigator with extensive experience in the hotel industry.

“It doesn’t require brilliance on the part of the hacker,” Mr. Roman said. “Most of the chronic security breaches in the hotel industry are the result of a failure to equip, or to properly store or transmit, this kind of data, and that starts with the point-of-sale credit card swiping systems.”

The sophistication of such systems can vary widely from one hotel to the next, even within the same corporate chain, making it an easy route for hackers.

The Trustwave report said that “organizations large and small were found to be moving forward with plans to implement new technology, while leaving basic security threats overlooked.”

Mr. Roman works with hotels to improve security technology, but he said that as the industry hit tough economic times and hotel owners cut spending, security upgrades sometimes lagged. Proper technology security “requires purchasing not only of software and hardware, firewalls and encryption programs,” but training staff and constantly monitoring of transactions and data access, he said.

“We’re seeing thousands and thousands of credit cards being hacked out of hotel systems. So I would say the industry is not doing incredibly well on this,” Mr. Roman said.

The full extent of credit card fraud by those who breach hotel systems is unknown. But anecdotally, hacking incidents occur with disturbing regularity.

Last month, Destination Hotels and Resorts, a chain of luxury properties in the United States, notified customers that credit cards “may have been compromised.”

ABC News reported that Destination had been victimized by “an intense database attack that lasted over three months,” and quoted law enforcement authorities saying that losses, which totaled hundreds of thousands of dollars, averaged $2,000 to $3,000 on each of the estimated 700 credit card numbers stolen.

Also last month, Wyndham Hotels sent customers a statement saying that a “sophisticated hacker had penetrated our computer system” at as many as 31 hotels from Nov. 7, 2009, to Jan. 23. Wyndham said it was improving its security technology.

It often takes months for these attacks to be discovered by hotels — and by customers who may be on the road frequently and not monitoring card activity reports carefully.

My wife and I had separate credit cards that we used for business travel, but each account was compromised in the last eight months shortly after hotel stays. In both cases, hackers made multiple unauthorized purchases — all for small amounts and as many as 10 in one day — from merchants like the Apple iTunes Store.

In both cases, the total charges exceeded $400 before we noticed the fraud and called our card companies. Fortunately, we had called in a timely manner and were not responsible for the charges.

Fraud experts say that hackers often steal personal data and make multiple small charges to validate a card, probe its vulnerability and test the vigilance of a cardholder before making bigger charges.

Meanwhile, credit card companies are pressuring merchants, including hotels, to adopt uniform security standards.

After all, the credit card company usually gets stuck with most of the bill if a consumer notifies the company of the misuse promptly, Mr. Roman said. To guard against such problems, he advises travelers to be vigilant about checking charges online after business trips.

And one additional piece of advice he offered to hotels and travelers alike: “Shred everything.”

We Were Permanently Banned from the Miami-Dade Metrorail for Taking Photos

Update: The National Press Photographers Association is protesting the way authorities handled the situation. The Society of Professional Journalists is also looking into the situation.

Carlos Miller
We had planned to ride the Metrorail through three stations to see if anybody would try to stop us from taking pictures of the trains.

We didn’t even make it inside the first station.

By the time it was over, three hours after a security guard told us it was against the law to take pictures in the parking lot of the Douglas Road Metro Station in Miami, a 50 State Security Captain had banned us for life from ever setting foot on the Metrorail again.

All because of those photos we took in the parking lot.

Clearly, somebody is going to learn a lesson in all this. And it’s not going to be us.

I was with Stretch Ledford, a veteran photojournalist who is currently pursuing a Masters of Arts degree in Multimedia Journalism at the University of Miami School of Communication.

Check out his version of the story here.

I first heard of Ledford when I saw his video of Overtown after it was posted on the South Florida Daily Blog a few months back. I was impressed with the video and knew I would like the guy.

I met him shortly after when I spoke in front of his social media for journalists class at the University of Miami. I complimented him on his videos. He complimented me on my blog.

Ledford has worked in 50 countries on five continents. He has experienced countries where the government actually doesn’t allow photography of public buildings. So it irks him when he is denied that right in the United States.

When he decided to work on a project about photographers not being allowed to take pictures on the Metrorail for his media law class, he asked if I would like to work with him on it.

He didn’t have to ask twice.

Ledford had done his homework on this project, having interviewed Miami-Dade Transit head of security Eric J. Muntan who informed him that people had the right to take pictures within the Metrorail station with the exception of commercial photography, which needed prior approval.

Muntan also sent him Miami-Dade County Code 30B-5 (2) which states the following:

Commercial photography or recording. No person, unless authorized in writing by MDTA or the County Manager when appropriate under Section 2-11.14 of this Code, shall take still, motion, or sound motion pictures or sound records or recordings of voices or otherwise for commercial, training or educational purposes, other than news coverage anywhere in the transit system.
There also happens to be an exemption towards students and faculty regarding the “educational purposes” portion of this code, which is outlined in Miami-Dade County Ordinance Sec. 2-11.14 (2) (iii).

“[n]othing in this section shall require any permit from: (i) Individuals filming or video taping only for their own personal or family use; (ii) Employees of print or electronic news media when filming on-going news events. This exception shall not apply to simulations or re-enactments orchestrated by print or electronic news media; or (iii) Students and faculty filming exclusively for educational purposes. “
However, Muntan also told Ledford the contracted security guards at the stations are allowed to harass question photographers.

As we spoke on the telephone and as I informed you, in a proactive effort to maintain the highest vigilance of the MDT system, MDT’s contracted security officers and this office’s security supervisors do reserve the right to question those individuals who may be engaged in any photographic activities in or around MDT property.
The county currently contracts with a company called 50 State Security, which apparently only does business in one state. The county previously contracted with Wackenhut but they suffered too many embarrassing scandals. And they weren’t very versed in photographers rights either.

But 50 State Security is much worse.

We were approached by a 50 State Security guard within minutes after stepping into the parking lot of the Douglas Road Metrorail Station a little after 2 p.m. on Wednesday.

Ledford was photographing one of those Coral Gables trolleys when the guard told him it was against the law due to terrorism reasons.

Ledford attempted to show him the email from Muntan, but the security guard was agitated that I would not stop filming him, so he walked away and called the cops. And then he punched out for the day. Seriously.

So then Ledford showed the email to a female security guard who still insisted that we needed prior permission. When we told her that the email proves she was wrong, she barred us from entering the station until a 50 State Security supervisor arrived. And this after we had already purchased our tickets.

Then a Miami police officer arrived and he said there was nothing he could do about it, so Ledford asked him to call a sergeant, who arrived but said there was nothing he could do about it because the Metrorail station falls under county jurisdiction, not city.

So Miami-Dade cops were dispatched to the scene, who in turn called a “Homeland Security” cop to the scene, but it turned out, he was really a Miami-Dade cop who only worked in the Homeland Security Bureau, whatever that means.

Every single one of those cops ceded their authority to the security guards, informing us that if the guards didn’t want us taking photos or riding the Metrorail, then there was nothing they could do to supercede that authority.

At one point, after waiting for the 50 State Security supervisor for an hour, Ledford was about to walk right in and allow the security guard to detain him as she threatened she would, but then the supervisor finally showed.

Captain Elliot Gelber of 50 State had no idea who Muntan was and he didn’t seem to understand the county code that stated we were allowed to take photos.

The Miami-Dade cops demanded our identifications and even though I didn’t think I was obligated to provide ID because I wasn’t being officially detained, I gave it to her anyway because I really don’t have anything to hide in that regard.

I also handed her my business card and told her to check out my blog.

Finally, after the Homeland Security cop determined that we were not on any terrorist watch lists – at least not yet – we were told we were free to go but would not be allowed on the train after all.

The truth is, we could have left whenever we wanted but the goal was to make some sense of the contradictory policies in place regarding photography at the Metrorail stations.

But instead of getting answers, we were told we would never be allowed on the train again. For the rest of our lives. We were told we would be arrested for trespassing If we dared set foot on any Metrorail property for as long as we live.

They could only have managed this by obtaining the info from our identifications. Not that I have any regrets in handing it to them.

The bottom line is, we have a lawyer, a very good lawyer, a former Miami Herald media lawyer who now teaches media law at the University of Miami. His name is Sam Terilli.

This is far from over.

Square Pixel Inventor Tries to Smooth Things Out
Rachel Ehrenberg

Russell Kirsch says he’s sorry.

More than 50 years ago, Kirsch took a picture of his infant son and scanned it into a computer. It was the first digital image: a grainy, black-and-white baby picture that literally changed the way we view the world. With it, the smoothness of images captured on film was shattered to bits.

The square pixel became the norm, thanks in part to Kirsch, and the world got a little bit rougher around the edges.

As a scientist at the National Bureau of Standards in the 1950s, Kirsch worked with the only programmable computer in the United States. “The only thing that constrained us was what we imagined,” he says. “So there were a lot of things we thought of doing. One of which was, what would happen if computers could see the world the way we see it?”

Kirsch and his colleagues couldn’t possibly know the answer to that question. Their work laid the foundations for satellite imagery, CT scans, virtual reality and Facebook.

Kirsch made that first digital image using an apparatus that transformed his picture into the binary language of computers, a regular grid of zeros and ones. A mere 176 by 176 pixels, that first image was built from roughly one one-thousandth the information in pictures captured with today’s digital cameras. Back then, the computer’s memory capacity limited the image’s size. But today, bits have become so cheap that a person can walk around with thousands of digital baby photos stored on a pocket-sized device that also makes phone calls, browses the Internet and even takes photos.

Yet science is still grappling with the limits set by the square pixel.

“Squares was the logical thing to do,” Kirsch says. “Of course, the logical thing was not the only possibility … but we used squares. It was something very foolish that everyone in the world has been suffering from ever since.”

Now retired and living in Portland, Oregon, Kirsch recently set out to make amends. Inspired by the mosaic builders of antiquity who constructed scenes of stunning detail with bits of tile, Kirsch has written a program that turns the chunky, clunky squares of a digital image into a smoother picture made of variably shaped pixels.

He applied the program to a more recent picture of his son, now 53 years old, which appears with Kirsch’s analysis in the May/June issue of the Journal of Research of the National Institute of Standards and Technology.

“Finally,” he says, “at my advanced age of 81, I decided that instead of just complaining about what I did, I ought to do something about it.”

Kirsch’s method assesses a square-pixel picture with masks that are 6 by 6 pixels each and looks for the best way to divide this larger pixel cleanly into two areas of the greatest contrast. The program tries two different masks over each area — in one, a seam divides the mask into two rough triangles, and in the other a seam creates two rough rectangles. Each mask is then rotated until the program finds the configuration that splits the 6-by-6 area into sections that contrast the most. Then, similar pixels on either side of the seam are fused.

Kirsch has also used the program to clean up an MRI scan of his head. The program may find a home in the medical community, he says, where it’s standard to feed images such as X-rays into a computer.

Kirsch’s approach addresses a conundrum that the field of computational photography continues to grapple with, says David Brady, head of Duke University’s imaging and spectroscopy program in Durham, N.C.

Images built from pixels can show an incredible amount of detail, Brady says. “It’s fun to talk to kids about this because they don’t know what I’m talking about anymore, but the snow on analog television — a block-based imager can reconstruct that pattern exactly.”

But images taken from real life never look like that, Brady says. Typically, they have several large uniform sections — forehead, red shirt, blue tie. This means there’s a high probability that one pixel in an image will look the same as the pixel next to it. There’s no need to send all those look-alike pixels as single pieces of information; the information that’s really important is where things are different.

“I always joke that it’s like Los Angeles weather,” Brady says. “If you were a weatherman in Los Angeles you would almost always be right if you say tomorrow is going to be the same weather as today. So one thing you can do is say, I’m going to assume the next pixel is like this one. Don’t talk to me, don’t tell me anything about the image, until you get something different. A good weatherman in Los Angeles tells you when a big storm is coming. In an image, that’s an edge. You want to assume smoothness but have a measurement system that’s capable of accurately finding where the edges are.”

Where Kirsch uses masks to accomplish that task, researchers today typically use equations far more complex than his to strike the balance between shedding unnecessary information and keeping detail. Pixels are still the starting point of digital pictures today, but math — wavelet theory in particular — is what converts the pixels into the picture. Wavelet theory takes a small number of measurements and turns them into the best representation of what’s been measured. This best estimation of a picture allows a megapixel image to be stored as mere kilobytes of data.

To Stop Cheats, Colleges Learn Their Trickery
Trip Gabriel

The frontier in the battle to defeat student cheating may be here at the testing center of the University of Central Florida.

No gum is allowed during an exam: chewing could disguise a student’s speaking into a hands-free cellphone to an accomplice outside.

The 228 computers that students use are recessed into desk tops so that anyone trying to photograph the screen — using, say, a pen with a hidden camera, in order to help a friend who will take the test later — is easy to spot.

Scratch paper is allowed — but it is stamped with the date and must be turned in later.

When a proctor sees something suspicious, he records the student’s real-time work at the computer and directs an overhead camera to zoom in, and both sets of images are burned onto a CD for evidence.

Taylor Ellis, the associate dean who runs the testing center within the business school at Central Florida, the nation’s third-largest campus by enrollment, said that cheating had dropped significantly, to 14 suspected incidents out of 64,000 exams administered during the spring semester.

“I will never stop it completely, but I’ll find out about it,” Mr. Ellis said.

As the eternal temptation of students to cheat has gone high-tech — not just on exams, but also by cutting and pasting from the Internet and sharing of homework online like music files — educators have responded with their own efforts to crack down.

This summer, as incoming freshmen fill out forms to select roommates and courses, some colleges — Duke and Bowdoin among them — are also requiring them to complete online tutorials about plagiarism before they can enroll.

Anti-plagiarism services requiring students to submit papers to be vetted for copying is a booming business. Fifty-five percent of colleges and universities now use such a service, according to the Campus Computing Survey.

The best-known service, Turnitin.com, is engaged in an endless cat-and-mouse game with technologically savvy students who try to outsmart it. “The Turnitin algorithms are updated on an on-going basis,” the company warned last month in a blog post titled “Can Students ‘Trick’ Turnitin?”

The extent of student cheating, difficult to measure precisely, appears widespread at colleges. In surveys of 14,000 undergraduates over the last four years, an average of 61 percent admitted to cheating on assignments and exams.

The figure declined somewhat from 65 percent earlier in the decade, but the researcher who conducted the surveys, Donald L. McCabe, a business professor at Rutgers, doubts there is less of it. Instead, he suspects students no longer regard certain acts as cheating at all, for instance, cutting and pasting a few sentences at a time from the Internet.

Andrew Daines, who graduated in May from Cornell, where he served on a board in the College of Arts and Sciences that hears cheating cases, said Internet plagiarism was so common that professors told him they had replaced written assignments with tests and in-class writing.

Mr. Daines, a philosophy major, contributed to pages that Cornell added last month to its student Web site to bring attention to academic integrity. They include a link to a voluntary tutorial on avoiding plagiarism and a strongly worded admonition that “other generations may not have had as many temptations to cheat or plagiarize as yours,” and urging students to view this as a character test.

Mr. Daines said he was especially disturbed by an epidemic of students’ copying homework. “The term ‘collaborative work’ has been taken to this unbelievable extreme where it means, because of the ease of e-mailing, one person looking at someone else who’s done the assignment,” he said.

At M.I.T., David E. Pritchard, a physics professor, was able to accurately measure homework copying with software he had developed for another purpose — to allow students to complete sets of physics problems online. Some answered the questions so fast, “at first I thought we had some geniuses here at M.I.T.,” Dr. Pritchard said. Then he realized they were completing problems in less time than it took to read them and were copying the answers — mostly, it turned out, from e-mail from friends who had already done the assignment.

About 20 percent copied one-third or more of their homework, according to a study Dr. Pritchard and colleagues published this year. Students who copy homework find answers at sites like Course Hero, which is a kind of Napster of homework sharing, where students from more than 3,500 institutions upload papers, class notes and past exams.

Another site, Cramster, specializes in solutions to textbook questions in science and engineering. It boasts answers from 77 physics textbooks — but not Dr. Pritchard’s popular “Mastering Physics,” an online tutorial, because his publisher, Pearson, searches the Web for solutions and requests they be taken down to protect its copyright.

“You can use technology as well for detecting as for committing” cheating, Dr. Pritchard said.

The most popular anti-cheating technology, Turnitin.com, says it is now used by 9,500 high schools and colleges. Students submit written assignments to be compared with billions of archived Web pages and millions of other student papers, before they are sent to instructors. The company says that schools using the service for several years experience a decline in plagiarism.

Cheaters trying to outfox Turnitin have tried many tricks, some described in blogs and videos. One is to replace every “e” in plagiarized text with a foreign letter that looks like it, such as a Cyrillic “e,” meant to fool Turnitin’s scanners. Another is to use the Macros tool in Microsoft Word to hide copied text. Turnitin says neither scheme works.

Some educators have rejected the service and other anti-cheating technologies on the grounds that they presume students are guilty, undermining the trust that instructors seek with students.

Washington & Lee University, for example, concluded several years ago that Turnitin was inconsistent with the school’s honor code, “which starts from a basis of trusting our students,” said Dawn Watkins, vice president for student affairs. “Services like Turnitin.com give the implication that we are anticipating our students will cheat.”

For the similar reasons, some students at the University of Central Florida objected to the business school’s testing center with its eye-in-the-sky video in its early days, Dr. Ellis said.

But last week during final exams after a summer semester, almost no students voiced such concerns. Rose Calixte, a senior, was told during an exam to turn her cap backward, a rule meant to prevent students from writing notes under the brim. Ms. Calixte disapproved of the fashion statement but didn’t knock the reason: “This is college. There is the possibility for people to cheat.”

A first-year M.B.A. student, Ashley Haumann, said that when she was an undergraduate at the University of Florida, “everyone cheated” in her accounting class of 300 by comparing answers during quizzes. She preferred the highly monitored testing center because it “encourages you to be ready for the test because you can’t turn and ask, ‘What’d you get?’ ”

For educators uncomfortable in the role of anti-cheating enforcer, an online tutorial in plagiarism may prove an elegantly simple technological fix.

That was the finding of a study published by the National Bureau of Economic Research in January. Students at an unnamed selective college who completed a Web tutorial were shown to plagiarize two-thirds less than students who did not. (The study also found that plagiarism was concentrated among students with lower SAT scores.)

The tutorial “had an outsize impact,” said Thomas S. Dee, a co-author, who is now an economist at the University of Virginia.

“Many instructors don’t want to create this kind of adversarial environment with their students where there is a presumption of guilt,” Mr. Dee said. “Our results suggest a tutorial worked by educating students rather than by frightening them.”

Only a handful of colleges currently require students to complete such a tutorial, which typically illustrates how to cite a source or even someone else’s ideas, followed by a quiz.

The tutorial that Bowdoin uses was developed with its neighbor colleges Bates and Colby several years ago. Part of the reason it is required for enrollment, said Suzanne B. Lovett, a Bowdoin psychology professor whose specialty is cognitive development, is that Internet-age students see so many examples of text, music and images copied online without credit that they may not fully understand the idea of plagiarism.

As for Central Florida’s testing center, one of its most recent cheating cases had nothing to do with the Internet, cellphones or anything tech. A heavily tattooed student was found with notes written on his arm. He had blended them into his body art.

Computers at Home: Educational Hope vs. Teenage Reality
Randall Stross

MIDDLE SCHOOL students are champion time-wasters. And the personal computer may be the ultimate time-wasting appliance. Put the two together at home, without hovering supervision, and logic suggests that you won’t witness a miraculous educational transformation.

Still, wherever there is a low-income household unboxing the family’s very first personal computer, there is an automatic inclination to think of the machine in its most idealized form, as the Great Equalizer. In developing countries, computers are outfitted with grand educational hopes, like those that animate the One Laptop Per Child initiative, which was examined in this space in April. The same is true of computers that go to poor households in the United States.

Economists are trying to measure a home computer’s educational impact on schoolchildren in low-income households. Taking widely varying routes, they are arriving at similar conclusions: little or no educational benefit is found. Worse, computers seem to have further separated children in low-income households, whose test scores often decline after the machine arrives, from their more privileged counterparts.

Ofer Malamud, an assistant professor of economics at the University of Chicago, is the co-author of a study that investigated educational outcomes after low-income families received vouchers to help them buy computers.

“We found a negative effect on academic achievement,” he said. “I was surprised, but as we presented our findings at various seminars, people in the audience said they weren’t surprised, given their own experiences with their school-age children.”

Professor Malamud and his collaborator, Cristian Pop-Eleches, an assistant professor of economics at Columbia University, did their field work in Romania in 2009, where the government invited low-income families to apply for vouchers worth 200 euros (then about $300) that could be used for buying a home computer.

The program provided a control group: the families who applied but did not receive a voucher. They showed the same desire to own a machine, and their income was often only slightly above the cut-off point for the government program.

In a draft of an article that the Quarterly Journal of Economics will publish early next year, the professors report finding “strong evidence that children in households who won a voucher received significantly lower school grades in math, English and Romanian.” The principal positive effect on the students was improved computer skills.

At that time, most Romanian households were not yet connected to the Internet. But few children whose families obtained computers said they used the machines for homework. What they were used for — daily — was playing games.

In the United States, Jacob L. Vigdor and Helen F. Ladd, professors of public policy at Duke University, reported similar findings. Their National Bureau of Economic Research working paper, “Scaling the Digital Divide,” published last month, looks at the arrival of broadband service in North Carolina between 2000 and 2005 and its effect on middle school test scores during that period. Students posted significantly lower math test scores after the first broadband service provider showed up in their neighborhood, and significantly lower reading scores as well when the number of broadband providers passed four.

The Duke paper reports that the negative effect on test scores was not universal, but was largely confined to lower-income households, in which, the authors hypothesized, parental supervision might be spottier, giving students greater opportunity to use the computer for entertainment unrelated to homework and reducing the amount of time spent studying.

The North Carolina study suggests the disconcerting possibility that home computers and Internet access have such a negative effect only on some groups and end up widening achievement gaps between socioeconomic groups. The expansion of broadband service was associated with a pronounced drop in test scores for black students in both reading and math, but no effect on the math scores and little on the reading scores of other students. In the report, the authors do not speculate about what caused the disparities. Neither author responded to a request for an interview.

The state of Texas recently completed a four-year experiment in “technology immersion.” The project spent $20 million in federal money on laptops distributed to 21 middle schools whose students were permitted to take the machines home. Another 21 schools that did not receive funds for laptops were designated as control schools.

At the conclusion, a report prepared by the Texas Center for Educational Research tried to make the case that test scores in some academic subjects improved slightly at participating schools over those of the control schools. But the differences were mixed and included lower scores for writing among the students at schools “immersed” in technology.

THE one area where the students from lower-income families in the immersion program closed the gap with higher-income students was the same one identified in the Romanian study: computer skills.

Catherine Maloney, director of the Texas center, said the schools did their best to mandate that the computers would be used strictly for educational purposes. Most schools configured the machines to block e-mail, chat, games and Web sites reached by searching on objectionable key words. The key-word blocks worked fine for English-language sites but not for Spanish ones. “Kids were adept at getting around the blocks,” she said.

How disappointing to read in the Texas study that “there was no evidence linking technology immersion with student self-directed learning or their general satisfaction with schoolwork.”

When devising ways to beat school policing software, students showed an exemplary capacity for self-directed learning. Too bad that capacity didn’t expand in academic directions, too.

Angle Sends Cease-And-Desist To Reid -- For Reposting Her Own Website
Eric Kleefeld

Sharron Angle has resorted to an unusual maneuver to counter Senate Majority Leader Harry Reid's attacks on her past quotes and positions, the Reid campaign has announced: A cease-and-desist letter, demanding that Reid no longer republish Angle's previous campaign website.

The short version of the story is as follows: After the former state Rep won Nevada's Republican Senate primary, Angle's campaign took down most of its website, and later replaced it with a relaunched version that in some ways toned down her right-wing rhetoric. But Internet pages are rarely ever forgotten -- the Reid campaign saved the old version, and put up a website called "The Real Sharron Angle," reproducing the old content.

Then, they say, the Angle campaign sent them a cease-and-desist letter, claiming misuse of copyrighted materials in the reposting of the old website -- which was, of course, being posted for the purposes of ridiculing Angle. The Reid campaign has in fact taken down the site, rerouting visitors to another website that goes after Angle's positions, "Sharron's Underground Bunker."

The Reid campaign said in a press release:

Despite her threat of a frivolous lawsuit, Nevada voters can still learn about her long-held policy positions at www.sharronsundergroundbunker.com.

"These are Sharron Angle's positions in Sharron's own words from Sharron's own website. What was good enough for Nevada voters to read during the primary should be good enough for them now," said Reid campaign spokesman Jon Summers. "Sharron has long believed in killing Social Security, eliminating the Departments of Education and Energy and shipping nuclear waste to Nevada. We've always heard that Sharron Angle is an unapologetic conservative. It has to be embarrassing for her to have her handlers trying to hide who she really is."
We asked Reid campaign deputy communications director Zac Petkanas whether, by taking down the "Real Sharron Angle" site, they were admitting the legitimacy of the complaint. "While we do not necessarily agree with the Angle campaign's assertions, a point is made," said Petkanas. "Sharron Angle is hiding her views from Nevada voters."

The Angle campaign has not returned our request for comment.

Woot To AP: You Owe Us $17.50 For Copying Our Content
Marc Perton

(Woot.com. Please don't charge us for this. We need the money to upgrade our database server.)

When Woot announced last week that it was going to be acquired by Amazon.com, just about everyone wrote about it. However, of the many media organizations that covered the deal, only one has floated a policy that would charge bloggers for the kind of excerpting that's historically been considered fair use. So, when the Associated Press, in writing about the Woot-Amazon deal, borrowed some of Woot's own verbiage, the deal-a-day site struck back and told the wire service it expected $17.50 for the words. Or the AP could just buy two pairs of Sennheiser in-ear headphones and call it even.

We'll let Woot put it in their own words, though we really don't need a new set of earbuds:

The AP, we can’t thank you enough for looking our way. You see, when we showed off our good news on Wednesday afternoon, we expected we’d get a little bit of attention. But when we found your little newsy thing you do, we couldn’t help but notice something important. And that something is this: you printed our web content in your article! The web content that came from our blog! Why, isn’t that the very thing you’ve previously told nu-media bloggers they’re not supposed to do?

So, The AP, here we are. Just to be fair about this, we’ve used your very own pricing scheme to calculate how much you owe us. By looking through the link above, and comparing your post with our original letter, we’ve figured you owe us roughly $17.50 for the content you borrowed from our blog post, which, by the way, we worked very very hard to create. But, hey. We’re all friends here. And invoicing is such a hassle in today’s paperless society, are we right? How about this: instead of cutting us a check for the web content you liberated from our site, all you’ll need to do is show us your email receipt from today’s two pack of Sennheiser MX400 In-Ear Headphones, and we’ll call it even.
The AP report on the Amazon deal quoted roughly a sentence and a half from a post written by Woot CEO Matt Rutledge. However, given that the AP has previously suggested that writers pay for the right to quote as few as five words, $17.50 for Rutledge's 17 words, seems like a deal. Though at $6.99 plus $5.00 for shipping, the earbuds are a much better deal.

Supply Chain for iPhone Highlights Costs in China
David Barboza

Last month, while enthusiastic consumers were playing with their new Apple iPhone 4, researchers in Silicon Valley were engaged in something more serious.

They cracked open the phone’s shell and started analyzing the new model’s components, trying to unmask the identity of Apple’s main suppliers. These “teardown reports” provide a glimpse into a company’s manufacturing.

What the latest analysis shows is that the smallest part of Apple’s costs are here in Shenzhen, where assembly-line workers snap together things like microchips from Germany and Korea, American-made chips that pull in Wi-Fi or cellphone signals, a touch-screen module from Taiwan and more than 100 other components.

But what it does not reveal is that manufacturing in China is about to get far more expensive. Soaring labor costs caused by worker shortages and unrest, a strengthening Chinese currency that makes exports more expensive, and inflation and rising housing costs are all threatening to sharply increase the cost of making devices like notebook computers, digital cameras and smartphones.

Desperate factory owners are already shifting production away from this country’s dominant electronics manufacturing center in Shenzhen toward lower-cost regions far west of here, even deep in China’s mountainous interior.

At the end of June, a manager at Foxconn Technology — one of Apple’s major contract manufacturers — said the company planned to reduce costs by moving hundreds of thousands of workers to other parts of China, including the impoverished Henan Province.

While the labor involved in the final assembly of an iPhone accounts for a small part of the overall cost — about 7 percent by some estimates — analysts say most companies in Apple’s supply chain — the chip makers and battery suppliers and those making plastic moldings and printed circuit boards — depend on Chinese factories to hold down prices. And those factories now seem likely to pass along their cost increases.

“Electronics companies are trying to figure out how to deal with the higher costs,” says Jenny Lai, a technology analyst at CLSA, an investment bank based in Hong Kong. “They’re already squeezed, so squeezing more costs out of the system won’t be easy.”

Apple can cope better than most companies because it has fat profit margins of as much as 60 percent and pricing power to absorb some of those costs. But makers of personal computers, cellphones and other electronics — including Dell, Hewlett-Packard and LG — deal with much slimmer profit margins according to several analysts. “The challenges are going to be much bigger for them,” Ms. Lai said. Most other industries, from textiles and toys to furniture, are under considerably more pressure.

One way to understand the changes taking shape in southern China is to follow the supply chain of the iPhone 4, which was designed by Apple engineers in the United States, sourced with high-tech components from around the world and assembled in China. Shipped back to the United States, the iPhone is priced at $600, though the cost to consumers is less, subsidized by AT&T in exchange for service contracts.

“China makes very little money on these things,” said Jason Dedrick, a professor at Syracuse University and an author of several studies of Apple’s supply chain. Much of the value in high-end products is captured at the beginning and end of the process, by the brand and the distributors and retailers.

According to the latest teardown report compiled by iSuppli, a market research firm in El Segundo, Calif., the bulk of what Apple pays for the iPhone 4’s parts goes to its chip suppliers, like Samsung and Broadcom, which supply crucial components, like processors and the device’s flash-memory chip.

In the iPhone 4, more than a dozen integrated circuit chips account for about two-thirds of the cost of producing a single device, according to iSuppli.

Apple, for instance, pays Samsung about $27 for flash memory and $10.75 to make its (Apple-designed) applications processor; and a German chip maker called Infineon gets $14.05 a phone for chips that send and receive phone calls and data. Most of the electronics cost much less. The gyroscope, new to the iPhone 4, was made by STMicroelectronics, based in Geneva, and added $2.60 to the cost.

The total bill of materials on a $600 iPhone — the supplies that go into final assembly — is $187.51, according to iSuppli.

The least expensive part of the process is manufacturing and assembly. And that often takes place here in southern China, where workers are paid less than a dollar an hour to solder, assemble and package products for the world’s best-known brands.

No company does more of it than Foxconn, a division of the Hon Hai Group of Taiwan, the world’s largest contract electronics manufacturer.

With 800,000 workers in China alone and contracts to supply Apple, Dell and H.P., Foxconn is an electronics goliath that also sources supplies, designs parts and uses its enormous size and military-style efficiency to assemble and speed a wide range of products to market.

“They’re like Wal-Mart stores,” Professor Dedrick said. “They’re low-margin, high-volume. They survive by being efficient.”

The world of contract manufacturers is invisible to consumers. But it’s a $250 billion industry, with just a handful of companies like Foxconn, Flextronics and Jabil Circuit manufacturing and assembling for all the global electronics brands.

They compete fiercely on price to earn small profit margins, analysts say. And they seek to benefit from tiny operational changes.

When a company is operating on the slimmest of profit margins as contract manufacturers are, soaring labor costs pose a serious problem. Wages in China have risen by more than 50 percent since 2005, analysts say, and this year many factories, under pressure from local governments and workers who feel they have been underpaid for too long, have raised wages by an extra 20 to 30 percent.

China’s currency has also appreciated sharply against the United States dollar since 2005, and after a two-year pause by Beijing, economists expect the renminbi to rise about 3 to 5 percent a year for the next several years.

“It takes 3,000 procedures to assemble an H.P. computer,” says Isaac Wang, an iSuppli analyst based in China. “If a contract manufacturer can find a way to save 10 percent of the procedures, then it gets a real good deal.”

Contract manufacturers like Foxconn are now searching for ways to reduce costs. Foxconn is considering moving inland, where wages are 20 to 30 percent lower. The company is also spending heavily on manufacturing many of the parts, molds and metals that are used in computers and handsets, even trying to find larger and cheaper sources of raw material.

“We either outsource the components manufacturing to other suppliers, or we can research and manufacture our own components,” says Arthur Huang, a Foxconn spokesman. “We even have contracts with mines which are located near our factories.”

Many analysts are optimistic the big brands will find new innovations to improve profitability. But within the crowd, there is growing skepticism about China’s manufacturing model after years of pressing workers to toil six or seven days a week, 10 to 12 hours a day.

“We’ve concluded Hon Hai’s labor-intensive model is not sustainable,” says Mr. Wang at iSuppli Research. “Though it can keep hiring 800,000 to one million workers, the problem is these workers can’t keep working like screws in an inhuman system.”

This type of low-end assembly work is also no longer favored in China, analysts say, because it does not produce big returns for the companies or the country. “China doesn’t want to be the workshop of the world anymore,” says Pietra Rivoli, a professor of international business at Georgetown University and author of “The Travels of a T-Shirt in the Global Economy.”

“The value goes to where the knowledge is.”

Bao Beibei and Chen Xiaoduan contributed research.

Big Wirus
Morgan Storey

Gather round everyone for a tale of woe.

So I loaned one of my many USB keys to Fiona to backup some of our photos to print at a BigW, Mt Gravatt to be precise. I had cleared everything off and handed it over to her to copy over the photos. We tried it in a local BigW (Mt Ommaney) on Saturday but couldn't find a station that worked properly, we managed to get a few photos printed, but Fiona kept the key to see if she could get them printed elsewhere.

Off she trotted to Mt Gravatt BigW on Monday after she dropped the kids at kindy, she printed out the photos and thought nothing of it. Wednesday night I decided I should move my files back, I plugged the USB key in and noticed among the photos a hiden autorun.inf... Not usual for me to have leave that there, a quick read of it in text editor let me see it was trying to run RECYCLER\S-1-5-21-1482476501-1644491937-682003330-1013\driver.exe scanning the file with clamwin let me know it was Trojan.Poison-36 (it goes by other names, trojan.killav is Symantecs name) a nasty little phone home trojan that was only discovered recently (9/06/10), that uses the usual trick of infecting attached drives with the autorun.inf trick. It also then goes on to try and kill av programs and then once that is done download other malware, see here

I was safe due to my self inflicted draconian software restriction policy, and Fiona who had plugged it in to her laptop was safe due to it being an exe and her running Linux.

So I notified BigW back on the 30th, I think for something so little, I have given them reasonable disclosure. It is something they could have designed against, by using a software restriction policy, or simply making the USB devices read only via policy, or hey you know Antivirus that at least occasionally gets updated...
I was and still am tempted to put my own little exe and autorun on a key to see if the kiosks are still vulnerable, but Fiona has advised against it, my little voice of reason.

My problem with this issue, is that there seems to be little design that has gone into a system that thousands of people probably use a week, and little concern for users of these systems, how many people are going to get home and infect their systems, how many are going to not realise it was due to the dodgy kiosk they used and then blame the internert, Microsoft, or their kids. I am not a big fan of misplaced blame.

Not really much news here, viruses are a part of life. But with most modern USB keys no longer having the nice little feature of a read only switch, there is little you can do to protect yourself. You could try having an autorun.inf on your key that is marked read only, that may work unless the virus knows how to overwrite it.



An agreement between several countries and spear headed by big business to put a stop to all internet piracy by making it a federal crime to pirate anything. as it currently stands piracy is a civil matter not a criminal matter and they have come up ways to get control of pirating including holding IP providers responsible for the content uploaded and download by customers so if we pirate the IP company gets busted for it, this forces IP companies to monitor every bit of data its customers send and receive

further more these select governments are attempting to legalize the random search, copying, and seizure of computers and other devices that hold digital data when a person brings them to an airport. they want to take our laptops with out provocation or reason to copy search them and copy your entire hard drive in an attempt to find pirated material

below are some links with more info, the piratebay link contains more links which are perhaps the most informative

irc.n0v4.com SSL on 6697 and 9999
Web IRC:

so /b/, discuss. what do you think and what do you think can/should be done?
more info

the following links appear to be leaked videos of govt official discussing ACTA

/b/ has a plan, we are organized. join us in stopping this.
1) bring "threat to internet privacy thanks to ACTA" to top of googles list
2) set up facebook page (done)
3) distribute fliers in areas of high foot traffic (see image)
4) write to congress, senate, obama, any and all govt officials
5) gain attention of mega media
6) stage rallies out side of white house similar places.


We are anonymous and we are fighting for our lives


use that link to help us bring our cause to the top of google most searched list

http://www2.parl.gc.ca/parlinfo/comp....aspx?menu=hoc find your MP for canadafags
http://www.contactingthecongress.org/ find your congressman for amerifags
http://www.senate.gov/general/contac...nators_cfm.cfm and find your senator for amerifag


The Unstoppable "Tech Support" Scam

Barry Collins investigates a computer virus swindle that the authorities seem powerless to prevent

They take mere hours to set up and they’re near impossible to shut down: a pernicious new type of scam is targeting British computer owners.

The con is both fiendishly clever and ridiculously simple. The fraudster cold-calls the customer and tells them that Microsoft has detected a virus on their PC, then invites them to download a piece of remote-assistance software. No doubt reassured by the lines of indecipherable code flitting across their screen, the caller assures the customer they can make the virus vanish – but first, of course, they want payment. £185 to be precise.

That’s the point at which PC Pro reader Mike McCartney entered the room and prevented his grandfather from making what could have been a very costly mistake. And judging by the groundswell of comments on the story we ran on the scam in March, many others have received similar calls.

The “company” behind the scam is called The Nerd Support – although there are others perpetrating similar swindles. The Nerd Support points its victims towards a legitimate looking website, which carries official-looking logos that reassure visitors that it’s a “Microsoft Registered Partner” and is even verified by McAfee Site Advisor as a site that’s passed its “intensive daily security scan” that tests for “dangerous sites, phishing, and other online dangers”. To add to its legitimacy, the site bears a working London 0203 telephone number.

It’s absurdly easy to pull off such a sting. Website domains can be registered for less than $10, and the relatively skimpy website could be cobbled together within hours. What’s more, the website’s FAQs and customer testimonials are duplicated across several other domains, suggesting the designer has either been making liberal use of the cut and paste commands, or that there are several identikit sites waiting to pull off the same scam if one domain gets blocked.

Cheap telephone numbers

The British telephone number can be bought from companies such as Skype for less than £4 per month and, of course, you don’t need to be anywhere near London to buy an 0203 telephone number. In fact, judging by the Indian hold music and the accents of the staff who answer The Nerd Support lines, we’d wager that the scam is being run closer to Bombay than Brixton.

And using a service such as Skype, scammers can make their international cold-calls for only fractions of a penny per minute (although there’s no suggestion Skype’s involved in the fraud).

While it’s a doddle to set up such a heist, shutting them down is much more difficult. A spokesperson for the Office of Fair Trading urged affected customers to ring its Consumer Direct helpline, although quietly conceded that if the scam was being run from abroad, the chances of it being closed down were slim.

Credit cards

A spokesperson for PhonepayPlus (formerly ICSTIS) said his organisation could only get involved if the fraudsters were using a premium-rate telephone line, and not the standard-rate 0203 number. He pointed us to telecoms regulator Ofcom, but its spokesperson said that shutting down a telephone number was “not within its remit” unless the telephone line itself was at the centre of the scam (such as charging people excessive fees for text messages).

And what of the companies whose reputations are being tarnished by association with The Nerd Support? In a statement sent to PC Pro, Microsoft said it was investigating the company: “There are no circumstances under which we would ever allow partners or any other organisations to pose as Microsoft. We take matters such as these extremely seriously and will take immediate action if such behaviour is brought to our attention and found to be the case.”

Meanwhile, McAfee said that “Site Advisor rates websites based on the security implications of visiting them – McAfee visits websites and tests them for a comprehensive set of security threats. Although some users’ experiences of The Nerd Support seem to imply that its activities may constitute a scam, testing is currently in progress to understand whether it carries any of these security threats”.

Which leaves only The Nerd Support itself. When PC Pro first telephoned the company and began asking questions, the company representative hung up. On our second attempt, the person who answered the phone – who claimed to be “in charge” – told us that The Nerd Support has never cold-called customers.

When we asked him why he was using Microsoft logos and pretending to represent the software giant, he became angry, demanding to know why he “should justify himself” to us before once again hanging up. Alas, it seems the con artists answer to no-one.

Whose Data Is It? Facebook's Business Is Your Information
Mark A. Shiffrin and Avi Silberschatz

Facebook, the online social network, has grown from being a place where users can easily click and share information with a self-selected network of friends and acquaintances to an Internet site where people increasingly find themselves sharing information with data predators. Facebook is the leader and model for selling information.

Tweaks to privacy controls, such a those announced Wednesday, don't solve the credibility problem for Facebook, which styles itself as the ultimate "friend" of its users. The controls often fail to work and few users understand them.

The data we have about Facebook users suggests that they might not be aware of how their information is used, and continue to visit the site. But there is a growing problem with Facebook's business model, far beyond the question of consumer choices on privacy. That business model undermines the site's utility to its users. It threatens to undermine the promise of social networking and requires government oversight to see that this very knowledgeable and powerful friend does not act as a foe.

Facebook and its partners should be allowed to sell access to users of the site for targeted advertising. However, the information exchanged among the users themselves should not be a commodity to be traded by Facebook. That user information has become the basis of Facebook's future value as it moves toward a private sale or public offering of stock, and that is the issue. Facebook moved from what users saw as its original mission — providing convenient one-click communication between real friends — to allowing others, who we do not know or want to know, to learn things about us that are none of their business.

Facebook lulls users into thinking of the site as their trusted friend. Users share their likes, dislikes and personal predilections and, then, the trusted friend can share their confidences at its discretion.

Being able to click and communicate with a wide group of friends is a terrific innovation. That was the promise of Facebook. It is also part of the Twitter phenomenon. But that promise is broken when Facebook makes the group ever-wider, with confusing privacy practices and an affinity for data predators. We should not need lawyers to parse Facebook's nearly 6,000 word privacy policy, and we should not have to trust a business to decide what information about ourselves we want to share, and with whom.

With euphemisms like "enhanced user experience," Facebook provides access to our selectively shared data beyond actual or accepted friends to a much larger audience. Facebook users don't join the site and compile a list of friends so Facebook can share their personal information more broadly across the Internet or with marketers craving information such as favorite brands, entertainments, relationship status, religion or politics.

Online social networks create a comfortable environment where users freely post personal information such as likes, dislikes, sexual partners, favorite music and photos as permanent data. Young users are especially vulnerable, but so are those who are less Internet savvy, which includes many older users. We are all vulnerable when we are dealing with the legalese of website privacy polices.

Users end up not using the extensive and hard to understand privacy policies, effectively and erroneously trusting the kindness of Facebook's lawyers. This allows Facebook to capitalize on their users' data with lasting consequences.

Facebook is becoming a library of available consumer data. Facebook pages include sensitive personal information and images of loved ones, including children. This information is now being disseminated to police, private investigators, employers and potential employers, former spouses and significant others, journalists and sexual predators, as well as businesses that seek to know our impulses.

Users own data. An Internet service provider does not own what is conveyed in our personal e-mail. A phone company does not own what is conveyed in our phone calls. Our communications on Facebook are a kind of networked e-mail, targeted by the sender: Facebook should not own them, either, especially when it shares our information with data predators and corporate profilers. .

Facebook can clean up its act on its own and restore users' confidence, but that requires more than press releases and cleaner options for privacy. Beyond Federal Trade Commission action, what might be best to protect Facebook's users is if 50 state attorneys general, who can target and end the kind of unfair, unconscionable and unscrupulous trade practices now seducing Facebook, initiate enforcement action in their states with their version of viral marketing, viral regulation.

Mark A. Shiffrin, a lawyer, is a former Connecticut state consumer protection commissioner and deputy general counsel of the U.S. Department of Education.

Avi Silberschatz is Sidney J. Weinberg Professor and chair of computer science at Yale University.

Motorola to Split in Two, Hopes to Regain Overseas Strength

Investors should focus on how the company will reestablish itself in China.
Bob Faulkner

Late last week, Motorola (MOT) filed Form 10 with the SEC as part of its planned split into two separate and publicly traded companies. The SpinCo (as they are referred to in SEC documents) will consist of mobile devices and its home solutions operations, and will operate as Motorola Mobility. The tax-free distribution to existing shareholders is expected to be completed in the first quarter of 2011.

Together, the two operations represented about $2.5 billion of revenue in the March quarter, split about two-thirds and one-third between mobile devices and home, respectively. Gross margin was about 24% but the combined entity had an operating loss of $172 million in the period driven by mobile devices. The home segment earned $20 million on $838 million in revenue.

What’s interesting in the filing is the geographic dispersal of revenue shown in the graph below. Obviously, this represents both business segments but we do know from the filing that 42% of the mobile devices revenue originated outside the US. However, if you believe as I do that the vast majority of Latin American revenue is mobile devices, come to Europe and Asia generating a paltry 26% of mobile-device revenue.

All of this is a far cry from four short years ago when then-CEO Ed Zander was proclaiming the number-two market share in North Asia and growing, the number-two market share in high-growth markets and growing, the number-two market share in Europe and growing, and more than doubling its market share in India, sequentially.

As the “stuff” hit the fan, the company rightly needed to shrink its operations, but when you look at what took place over the last few years it begs the question: Did they restructure in the wrong geographies? I’ve always liked to use China and India as proxies for emerging markets and the graph below provides a snapshot as to what growth has taken place in those two locations. When you consider this is new subscribers not phones sold, the numbers are even larger.

Granted, Motorola was fighting for its survival, but this was also a huge wave to miss.

Going forward, the mobile-device strategy continues to prioritize markets with the focus on North America and China initially. Exactly how it's going to reestablish itself in China should be a focus of investors. These two areas are then followed by Western Europe, Latin America, and “other parts of Asia” in 2011. The same question applies here as well as in what order.

Weighing on its ability to reenter the global stage will be the resources that Motorola mobility has at its disposal. The cash position wasn't included in the Form 10 filing but we know that all debt will be retained by the “other” Motorola. The only cash flow statement available was on an annual basis. In 2009, Motorola Mobility burned $1.1 billion, not much of an improvement from the $1.2 billion used in 2008. The number improved significantly (+$26 million) in the March quarter but the company will need a lot more to fund expansion.

Throughout the remainder of the year, similar filings with the SEC will update the condition of the new entity. They’re onerous with a lot of buried details. However, if you’re a holder of Motorola stock today, you’d better decide if you’re going to be a buyer or a seller when this starts trading.

Tim Berners-Lee. Confirming The Exact Location Where the Web Was Invented

I wrote to Tim Berners-Lee after exploring CERN last week, looking for the location where the web was invented, his replies regarding the exact locations are below. [ I've put up photos of the excursion as an Oobject list, here ]

There is a plaque in a corridor in building 2, but no specific offices are indicated and there is some ambiguity as to what happened where, in building 31. Thomas Madsen-Mygdal has a gallery showing locations in building 31 and 513, but there are very few places on the web documenting these places. I took photos of the plaque, such as the one here, with Creative Commons licenses, so that they could be used elsewhere.

The reason I’m interested in this is that recognizing the exact places involved in the birth of the web is a celebration of knowledge itself rather than belief, opinion or allegiance, both politically and spiritually neutral and something that everyone can potentially enjoy and feel a part of.

Secondly, many places of lesser importance are very carefully preserved. The place where the web was invented is arguably the most important place in 2 millennia of Swiss history and of global historical importance.

Lastly, this kind of information is perhaps overlooked as being so obvious as to be common knowledge, exactly the sort of thing that sometimes gets forgotten. I’m not suggesting that the locations have indeed been overlooked, but they are not preserved or all indicated and the people I spoke to didn’t know the full details. So just in case…

DG: Where were you (at CERN and which building/rooms or home) when you thought of or were writing the original proposal for the web in 1989?

TBL: I wrote the proposal, and developed the code in Building 31.

I was on the second (in the European sense) floor, if you come out of the elevator (a very slow freight elevator at the time anyway) and turn immediately right you would then walk into one of the two offices I inhabited. The two offices (which of course may have been rearranged since then) were different sizes: the one to the left (a gentle R turn out of the elevator) benefited from extra length as it was by neither staircase nor elevator.

The one to the right (or a sharp R turn out of the elevator) was shorter and the one I started in. I shared it for a long time with Claude Bizeau.

I think I wrote the memo there.

When I actually started work coding up the WWW code in September 1990, I moved into the larger office. That is where I had the NeXT machine, as I remember it.

The second floor had pale grey linoleum, the first floor, where Peggie Rimmer had her office, had red lino; the third floor had pale yellow lino. The ground floor had I think green lino. Also on the second floor was the Documentation et Données, later Computing and Networking, HQ with David Williams at one point heading it up.

DG: For the development of the web, can you remember which offices were used in building 31 or off the corridor shown in building 2 in the attached image?

TBL: Building 2 I never had an office in. Robert Caulliau did, and various students, including Henrik Frysyk Nielsen and Hakon Lie, and Ari Luotonen, worked there.

DG: Was some of it inspired at home and was that here: Rue de la Mairie, Cessy (France)?

TBL: My house was [exact address removed since people live there] Rue de la Mairie, but I rented it out for some time around 1990 and actually lived in Les Champs Blancs, Chavannes de Bois [Switzerland]. But then we moved back to Cessy for a year before leaving.

Upset Security Researchers Start Releasing Microsoft 0Days

Rally behind Google security engineer Tavis Ormandy
Lucian Constantin

A group of security researchers have released full details and exploitation code for an unpatched Windows local privilege escalation vulnerability. The researchers openly stated that they will continue to do so in response to how Microsoft treated Tavis Ormany, the Google engineer blamed for disclosing a critical Windows bug publicly last month.

The advisory for a new zero-day vulnerability affecting Windows Vista and Windows Server 2008 contains an interesting manifesto which reads: "Due to hostility toward security researchers, the most recent example being of Tavis Ormandy, a number of us from the industry (and some not from the industry) have come together to form MSRC: the Microsoft-Spurned Researcher Collective. MSRC will fully disclose vulnerability information discovered in our free time, free from retaliation against us or any inferred employer."

The name is clearly a pun directed at Microsoft's Security Response Center (MSRC), while Tavis Ormandy is the Google engineer who disclosed the Windows XP Help Center vulnerability that is currently being exploited in the wild. Ormandy has taken a lot of heat from both Microsoft and from others in the security community for publishing details about an unpatched critical vulnerability in the public domain.

According to Security Focus, the bug exposed by the so called "Microsoft-Spurned Researcher Collective" can lead to local privilege escalation. "An attacker may exploit this issue to execute arbitrary code with kernel-level privileges, however, this has not been confirmed. Successful exploits will result in the complete compromise of affected computers," the Security Focus advisory reads.

The upset security researchers poke more fun at Microsoft in its disclosure. For example their workaround section tells the company to locate the HKCU\Microsoft\Windows\CurrentVersion\Security registry key and change the "OurJob" boolean value to FALSE. They even include an email address that others willing to join the cause can use to make contact.

In related news, two other Microsoft zero-day vulnerabilities have been disclosed in the past week. One is located in mshtml.dll and exploitation leads to a memory leak condition. According to Ruben Santamarta, the security researcher who discovered it, the flaw affects Internet Explorer 8 on Windows XP, Vista and 7 32/64 bit, and can potentially be leveraged to circumvent ASLR and DEP.

The second bug affects Internet Information Services (IIS) 5.1 and can be used to bypass the server's security restrictions remotely. A security researcher named Soroush Dalili is credited with discovering this vulnerability. Complete exploitation details are available on his blog.

Apple Responds on iTunes Fraud, Vaguely Confirms said Fraud
Joshua Topolsky

Over the weekend we saw reports of what appeared to be fraud occurring in the iTunes system -- namely, a rogue developer had somehow managed to snag 42 of the top 50 sales positions in the App Store's "book" category with seemingly bogus content. It looked as if there was some correlation between those suspicious sales and word of an increase in iTunes account fraud, but Apple had been mum on the subject over the holiday weekend. We've finally gotten a response from the company, and the folks in Cupertino say that the developer in question -- a gentleman named Thuat Nguyen -- has been chucked out of the Store altogether. Additionally, while they don't explicitly say fraud occurred, they suggest you check with your bank and kill your card if any of your info was stolen... which seems to suggest that something funky happened to some users. Here it is from the horse's mouth:

The developer Thuat Nguyen and his apps were removed from the App Store for violating the developer Program License Agreement, including fraudulent purchase patterns.

Developers do not receive any iTunes confidential customer data when an app is downloaded.

If your credit card or iTunes password is stolen and used on iTunes we recommend that you contact your financial institution and inquire about canceling the card and issuing a chargeback for any unauthorized transactions. We also recommend that you change your iTunes account password immediately. For more information on best practices for password security visit http://www.apple.com/support/itunes.
So it looks like even the walled garden isn't impervious to attacks -- here's hoping the problems were limited to a small group of people. Have any of you guys noticed strange charges on your account? Double check it right now!

Until next week,

- js.

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Jack Spratts' Week In Review is published every Friday. Submit letters, articles, press releases, comments, questions etc. in plain text English to jackspratts (at) lycos (dot) com. Submission deadlines are Thursdays @ 1400 UTC. Please include contact info. The right to publish all remarks is reserved.

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