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Old 19-06-19, 06:27 AM   #1
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Default Peer-To-Peer News - The Week In Review - June 22nd, ’19

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June 22nd, 2019

VidAngel Hit with $62.4 Million Judgment for Pirating Movies
Gene Maddaus

A jury on Monday ordered VidAngel to pay $62.4 million to Disney, Fox, and Warner Bros. for streaming hundreds of movies on its service without permission.

The verdict is potentially a death blow to the Utah-based company, which sought to allow family audiences to watch Hollywood fare while skipping past violence, sex, and other objectionable content.

U.S. District Judge Andre Birotte had already ruled that VidAngel’s service was illegal, leaving the jurors to decide only the amount of damages. VidAngel ripped movies from DVD copies, and then streamed them to users with offensive content filtered out. The company argued this was allowed under the federal Family Movie Act, but Birotte did not agree and ordered the service to shut down in December 2016. The company later relaunched a filtering service for Netflix and Amazon, which continues to operate.

The case has been working its way through court since then. At trial, the studios asked the eight-member jury to impose the maximum penalty of $125 million for illegally streaming 819 movies, arguing that the company had willfully violated copyright law. VidAngel’s attorney, Mark Eisenhut, asked jurors to levy the minimum of $600,000, arguing that CEO Neal Harmon and his team honestly believed that what they were doing was legal.

In their verdict, the jurors landed halfway between those two figures.

“It feels like the jury split the baby,” Harmon said in an interview. “It just so happens that halfway in between is not a good situation for us.”

VidAngel is already in bankruptcy in Utah, and has about $2.2 million in the bank. The jury’s verdict — if it is upheld — could force the company into liquidation. Harmon said he planned to appeal.

In a statement, the studio plaintiffs applauded the verdict.

“The jury today found that VidAngel acted willfully, and imposed a damages award that sends a clear message to others who would attempt to profit from unlawful infringing conduct at the expense of the creative community,” the plaintiffs said.

Kelly Klaus, who argued the case for the plaintiffs, noted in his opening statement that VidAngel customers could stream movies for as little as $1 — undercutting services like Amazon and iTunes that had paid for their content.

Harmon said that customers who use the current service will not notice any immediate changes.

“In a matter of months we should have a better picture of what kind of guidance we can give customers going forward,” he said.

Harmon said he was frustrated that the trial did not allow the jurors to decide whether filtering is legal — only the penalty for the violations.

“It wasn’t a trial of both liability and damages,” he said. “Had it been so, it would have been easier for the jury to see our side of the story.”

Stream Ripping Site Convert2MP3, which had 684m Visits Over the Past 12 Months, has Been Shut Down
Murray Stassen

One of the world’s most-used websites for pirating music has been shut down.

Germany-based stream ripping site Convert2MP3 has ceased to operate following legal action coordinated by global recording industry body IFPI and BVMI in Germany.

The settlement, which included undisclosed financial compensation, required the global shutdown of Convert2MP3 and any other infringing sites owned by the operator.

Sites like Convert2MP3 literally allow you to convert streamed audio to an mp3 file; i.e. they allow the extraction and permanent download of copyrighted audio files from streaming services like YouTube.

Convert2MP3 reportedly had 684 million visits over the past 12 months.

Additionally, the site is required to hand over the Convert2MP3 domains to IFPI and agree to not infringe recorded music copyright in future.

A court in Germany previously granted a preliminary injunction in respect of Convert2MP3 on the basis that effective technological protection measures were circumvented via the service, and that it produced or owned software which allowed this to take place.

Frances Moore, Chief Executive, IFPI, said: “Stream ripping is a threat to the entire music ecosystem. Sites such as Convert2MP3 show complete disregard for the rights of artists and record companies and take money away from those creating and investing in music.

“The successful outcome of this case sends a clear signal to other stream ripping sites that they should stop their copyright infringing activities or face legal action.”

Dr. Florian Drücke, Chairman & CEO BVMI, added: “This is a great success for the digital music market.

“Since the music industry has transformed into a digital business it is of the utmost importance that the rights of artists and their partners are protected online.

“We are seeing an increasing understanding on the part of the courts and the fans that digital licensing is crucial for the creative industries and that business cases based on free riding are unacceptable.”

Bulgarian Police Raids IPTV Network Operators Across Eight Cities
Bill Toulas

• Five cable operators supporting an illegal IPTV network had their equipment seized by the Bulgarian authorities.
• The police conducted eight simultaneous raids on different locations with the help of Europol.
• Pirate IPTV services are still in high demand, as people are looking to access content cheaply.

The Bulgarian police working in collaboration with the Europol has conducted eight simultaneous raids on eight different locations in Bulgaria, seizing the network equipment of cable operators who used it to support an illegal IPTV service. Approximately, the IPTV service that was taken down had a worldwide user base of 700,000. According to details that surfaced from the Ministry of the Interior of Bulgaria, there were five cable operators in the country who were intercepting legal broadcasts of local (Nova) and foreign channels (HBO), and then re-transmitted them to the IPTV service subscribers.

The police organized an undercover operation after obtaining permission for the raids from several district courts, and apparently, they managed to keep it all a secret. The support for the operation was provided by Europol’s Property Crime Coordinated Coalition, as well as the Audiovisual Anti-Piracy Alliance. Now, the authorities will evaluate the seized equipment and all forms of evidence to determine the amount of damage that was sustained by the legal broadcasting networks, as well as the level of tax evasion that characterized the illicit IPTV operations.

Bulgaria is a pirate cove in terms of countries that host the infrastructure of pirating services, and this was also highlighted recently by the USTR 2018 “Naughty List”. With such a popular IPTV service going dark, the Bulgarian police, Europol, and Ministry of Interior have every right to be proud of what they achieved. However, it is to be taken for granted that as long as there’s a demand for cheap IPTV services, there will always be someone to cover it no matter the risk of getting arrested and subsequently jailed. The authorities intensify their war against illegal IPTV platforms globally, but their popularity remains on the rise.

Since operations like the above seem to be unable to decisively stop illegal IPTV services in general, copyright holders, authorities, and anti-piracy alliances should reconsider what they can do to make their legal offerings more antagonistic, better, and cheaper. Until that happens, pirating services will continue to thrive, and news like the above will still be a drop in the ocean.

Prolific Pirate Bay User Pays $2900 in Settlement Case
Bill Toulas

• A Hawaiian who has downloaded thousands of movies since 2016 will now pay $2900 in damages.
• The pirate wasn’t aware that he was doing something illegal, and through that Pirate Bay was meant to be used for free file sharing.
• Movie companies are increasingly targeting the elderly now, as all other P2P users hide behind a VPN.

The movie companies “UN4 Productions” and “Millennium Funding” who own the rights for the films “Boyka: Undisputed IV” and “Mechanic: Resurrection”, have finally managed to track down a prolific Pirate Bay uploaded who is responsible for sharing more than a thousand torrents. The name is Gary Mitchell Graham, and he is a resident of Hawaii, living in a property that belongs to a 72-year old named Harding. By obtaining the IP address of the line that was used, the movie studios initially targeted the owner of the apartment, who denied all accusations and convinced the court.

This caused backlash from the local press and the attorney of the movie studios decided to retract the accusations and stop the legal proceedings. However, he investigated the matter further, as the torrents still stemmed from that IP address, so the actual culprit was finally found. Mr. Graham admitted his guilt by saying that he used the Pirate Bay platform to casually upload and download files since 2016. This was in line with the lawyer’s indictment, so no clouds of doubt could form this time. As the pirate clarified, he wasn’t aware of the illegal nature of what he did, saying that:

“I have been downloading torrent files of motion pictures from websites of the Pirate Bay at my residence. I believed that it was acceptable to do so because the websites are completely open with their objective to share files.”

The movie companies focused on the two films mentioned above, but the pirate doesn’t even remember downloading them since he has downloaded thousands of movies. This says something about the films in question and how you may end up paying thousands for something that you watched, but it was so indifferent you will soon not remember anything about it, not even the title. Even worse, you may end up not watching a movie because it was so bad, but you’ll still have an attorney going after you.

Mr. Graham accepted to pay a settlement of $2900 and also promised never to use Pirate Bay again. The owner of the apartment declared that he didn’t know that Graham was pirating movies, so he hasn’t concealed information previously to cover him. Probably, the old man may be yet to understand what happened at all. Obviously, the pirate wasn’t very tech savvy either, as he should have used a VPN tool in order to stay anonymous and keep himself and poor old Harding far from the court halls.

Lyrics Site Genius.com Accuses Google of Lifting Its Content
Robert McMillan

Genius Media Group Inc. depends on Google's search engine to send music lovers to its website stocked with hard-to-decipher lyrics to hip-hop songs and other pop hits.

Now Genius.com says its traffic is dropping because, for the past several years, Google has been publishing lyrics on its own platform, with some of them lifted directly from the music site.

Google denies doing anything nefarious. Still, Genius's complaints offer a window into the challenges small tech companies can face when the unit of Alphabet Inc. starts offering competing services on its platform.

The complaints come amid mounting concerns over the business practices of Google and other tech giants. The Wall Street Journal recently reported that the Department of Justice is gearing up for a new antitrust probe into the search company.

Genius said it notified Google as far back as 2017, and again in an April letter, that copied transcriptions appear on Google's website. The April letter, a copy of which was viewed by the Journal, warned that reuse of Genius's transcriptions breaks the Genius.com terms of service and violates antitrust law.

"Over the last two years, we've shown Google irrefutable evidence again and again that they are displaying lyrics copied from Genius," said Ben Gross, Genius's chief strategy officer, in an email message. The company said it used a watermarking system in its lyrics that embedded patterns in the formatting of apostrophes. Genius said it found more than 100 examples of songs on Google that came from its site.

Starting around 2016, Genius made a subtle change to some of the songs on its website, alternating the lyrics' apostrophes between straight and curly single-quote marks in exactly the same sequence for every song.

When the two types of apostrophes were converted to the dots and dashes used in Morse code, they spelled out the words "Red Handed."

In a statement, Google said the lyrics on its site, which pop up in little search-result squares called "information panels," are licensed from partners, not created by Google.

"We take data quality and creator rights very seriously and hold our licensing partners accountable to the terms of our agreement," Google said.

In 2016, Google partnered with LyricFind Inc., a Canadian company that secures deals with music publishers allowing companies such as Google to publish lyrics online. LyricFind Chief Executive Darryl Ballantyne said in an email that his company creates lyrics using its own content team. "We do not source lyrics from Genius," he said.

Google's information boxes are part of the company's ongoing effort to provide users with direct answers to their queries on results pages, particularly on mobile devices. The company says the boxes provide users with a better experience.

It also means Google is directing a smaller share of those queries to other sites. In March, 62% of mobile searches on Google didn't result in a user clicking through to another website, according to the web-analytics firm Jumpshot Inc.

Google previously has disrupted companies' business models by switching from referring traffic via search to providing services directly on Google websites. Google Maps increasingly competes with local-business listing service Yelp Inc., and Google's forays into travel and shopping services have taken traffic from online retailers and travel sites, said Rand Fishkin, chief executive of Sparktoro LLC, a web-marketing software company.

As a result, clicks to web publishers have been dropping on desktop search, Mr. Fishkin said. Desktop searches end without a click to another website about 35% of the time. That's up about 9% since 2016, according to Jumpshot.

Genius is a privately held company, and its investors include Andreessen Horowitz, Emagen Investment Group and the rapper Nas. The company doesn't disclose revenues but says its ad business runs to tens of millions of dollars per year. It also earns money by providing lyrics and facts about songs that it publishes and licenses under agreement with music publishers.

Genius clients include the music streaming website Spotify Technology SA and Apple Inc. Genius also makes money through different initiatives, including advertising and sponsored videos on YouTube.

Genius first became suspicious about the source of Google's lyrics in 2016, when a Genius software engineer spotted something odd about the song "Panda," a hit by rapper Desiigner. While many lyrics sites had published error-ridden transcriptions of Desiigner's hard-to-understand lyrics, Genius had the definitive version because Desiigner himself provided his lyrics to the site, Genius said.

"We noticed that Google's lyrics matched our lyrics down to the character," Genius's Mr. Gross said. A spokeswoman for Desiigner confirmed that his team verified the Panda lyrics with Genius.

The Journal randomly chose three of the more than 100 examples Genius says it found of songs on Google containing these watermarks, and verified the pattern of apostrophes was the same.

Because Genius doesn't itself own the copyright on the lyrics in question, the company may have a weak hand in any legal dispute with Google, said Daphne Keller, a former Google lawyer who now studies the regulation of technology platforms at Stanford's Center for Internet and Society.

"But it's totally understandable why they don't want this happening, and I imagine Google doesn't want it happening either," she said.

WeTransfer Security Incident Sent Files to the Wrong People
Lawrence Abrams

In an embarrassing security incident, the WeTransfer file sharing service announced that for two days it was sending it's users shared files to the wrong people. As this service is used to transfer what are considered private, and potentially sensitive files, this could be a big privacy issue for affected users.

Starting today, users began to receive emails from WeTransfer [1, 2, 3] stating that on June 16th and 17th, files sent using the WeTransfer service were also delivered to people that they were not meant to go to.

The email goes on to say that the team doesn't know what happened and that they are working to contain the situation.

The full text of this email reads:

Dear WeTransfer user,

We are writing to let you know about a security incident in which a number of WeTransfer service emails were sent to the wrong people. This happened on June 16th and 17th. Our team has been working tirelessly to correct and contain this situation and find out how it happened.

We have learned that a transfer you sent or received was also delivered to some people it was not meant to go to. Our records show those files have been accessed, but almost certainly by the intended recipient. Nevertheless, as a precaution we blocked the link to prevent further downloads.

As your email address was also included in the transfer email, please keep an eye out for any suspicious or unusual emails you receive.

We understand how important your data is and never take your trust in our service for granted. If you have any questions or concerns, just reply to this email to contact our support team.

The WeTransfer Team

WeTransfer posted a security notice on their web site that some accounts were logged out and had their passwords reset to protect their accounts and that they blocked access to the Transfer links that were involved in the incident. They did not, though, provide any further details on how this happened in the first place.

"This incident took place on June 16th and 17th, and upon discovery, we immediately took precautionary security measures to protect our users," stated WeTransfer's security notice. "This means that users might have been logged out of their account or asked to reset their password in order to safeguard their account. Additionally, we have blocked Transfer links to ensure the security of our users’ Transfers."

If this was simply a programming mistake on WeTransfer's end, it is peculiar that they had to reset user's passwords or felt the need to protect them. This could indicate a more serious issue, such as a breach of their network.

BleepingComputer has contacted WeTransfer about this incident but had not heard back at the time of this publication.

Traverse City Light and Power Approves Fiber Optic Internet
Rachael Schuit

A project to bring faster internet to thousands of northern Michigan customers took a step forward Tuesday night.

During a Traverse City Light and Power (TCLP) Board meeting, members decided to finance the first phase of a fiber optic internet project.

Members of the public expressed concerns over a public utility getting involved with something they think should be for private companies.

But others think the investment in fiber optic internet could be good for bringing tech businesses to Traverse City.

"Why is the government in competition with private companies?," said Barb Willing, concerned about fiber internet project. "That should be the major question that you're asking."

People stood at the podium Tuesday night during a public hearing to express concerns about the Traverse City Light and Power Board moving forward with a fiber internet project.

Concerns ranged from a public utility competing with private companies to what will happen if not enough Light and Power customers subscribe to fiber optic internet.

"If they aren't able to recover that investment what's going to happen is they're going to have to find some way to recover that money," said Gerald Degrazia, a concerned citizen about fiber optic internet. "Really the only way they can recover that money is to raise the rates for the electric customers."

TCLP executive director Tim Arends believes they will be able to pay back the nearly $3.5 million loan for phase one of the project.

"Even if the numbers do not come out to be what's projected the Fiber fund from the businesses that we currently operate and have been operating provide enough revenue to pay back the electric utility fund over a period," said Arends.

Others like Lowell Gruman, who has invested in high tech businesses like Atlas Space Operations and 20Fathoms said investing in high-speed fiber optic internet is a no brainer.

“High-speed fiber is absolutely the way to go at this moment. We have no time to lose," said Gruman, principal at Boomerang Catapult LLC. "Other cities and communities are ahead of us. We’ve got to catch up quickly. We’ve got to keep paddling quickly.”

A representative from Charter Spectrum was also at the meeting and said they already provide high-speed fiber optic internet to residents and businesses in Traverse City.

Phase one is expected to serve about 2,200 customers and will include Downtown Traverse City as well as Eighth Street and Woodmere.

If Traverse City Light and Power decides to expand the service for all customers it could cost $16 million.

Dish Is Near a $6 Billion Deal for T-Mobile, Sprint Assets
David McLaughlin, Scott Moritz, and Nabila Ahmed

Dish Network Corp. is in talks to pay at least $6 billion for assets that T-Mobile US Inc. and Sprint Corp. are unloading to win regulatory approval for their merger, according to people familiar with the matter.

Dish could announce a deal as soon as this week for assets including wireless spectrum and Sprint’s Boost Mobile brand, said the people, who asked to not be identified because the matter isn’t public. The deal hasn’t been finalized and talks could still fall through, said the people.

The potential divestitures are aimed at appeasing the Justice Department, which wants T-Mobile and Sprint to sell enough assets to ensure that the U.S. maintains at least four viable wireless players.

Representative for Dish and the Justice Department declined to comment. Representatives for T-Mobile and Sprint didn’t respond to requests for comment.

Dish rose 1.9% to $39.74 at 1:16 p.m. in New York trading, giving the Englewood, Colorado-based company a market value of about $18.6 billion. Sprint gained about 2.3% while T-Mobile rose 1.3%.

T-Mobile agreed to buy Sprint in April 2018 for $26.5 billion, betting that together the carriers can build a next-generation wireless network to better compete with industry leaders Verizon Communications Inc. and AT&T Inc.

Dish, co-founded by billionaire Charlie Ergen, had been on a shortlist of bidders for T-Mobile and Sprint assets favored by the Justice Department, people familiar with the matter said this month. Charter Communications Inc. and Altice USA Inc. were also on the list.

T-Mobile and Sprint have already promised to sell Boost to get approval from the Federal Communications Commission. They also have to win over the Justice Department, which is concerned about the merger reducing the number of major U.S. wireless carriers to three.

The companies are negotiating with the Justice Department after nine states and the District of Columbia sued to block the deal last week on antitrust grounds.

AT&T Cuts Another 1,800 Jobs as it Finishes Fiber-Internet Buildout

1,800 new job cuts in addition to 23,000 AT&T jobs cut since December 2017.
Jon Brodkin

AT&T has informed employees of plans to cut another 1,800 jobs from its wireline division, an AT&T workers' union told Ars today.

Last week, AT&T declared more than 1,800 jobs nationwide as "surplus," meaning they are slated to be eliminated in August or September, the Communications Workers of America (CWA) told Ars.

"They've been cutting their employment massively in the past year and a half or so," with cuts affecting both union and non-union jobs, CWA Communications Director Beth Allen told Ars. Under union contracts, AT&T can declare a surplus of jobs each quarter, she said. But even by AT&T standards, last week's surplus declaration "was a very large number," Allen said.

Jobs that are declared "surplus" are taken off the payroll, CWA says.

AT&T told Ars that most affected union workers will be able to stay at the company in other positions. An AT&T spokesperson said:

It would be misleading to refer to this as "layoffs." Most affected CWA-represented employees, including affected employees in the Midwest and Southwest, have a job-offer guarantee that ensures they'll be offered another job with the company—only those who volunteer to leave or decline a job offer will leave the company. In the Southeast, affected employees can choose to participate in our Job Bank Program for up to a year, during which time they receive a severance payment; continue to receive benefits and accrue credit for their pension; and can receive priority consideration and relocation benefits (if applicable) for other job opportunities as a regular employee.

But letters from AT&T to the CWA say that only 27 of about 550 employees declared "surplus" in the Southwest division will be given so-called "follow-the-work" opportunities in which they can take nearly identical jobs in other locations.

Follow-the-work offers are given when an employee's specific job is consolidated with another position or moved to another geographic location, AT&T said. This is different from the job-offer guarantee that ensures "surplus" employees will be offered a different type of job in the company; AT&T didn't say exactly how many surplus employees will get those offers.

"AT&T is eliminating a person's job and forcing them to make a choice—take another job, sometimes far away from home, sometimes at a lower rate of pay, or leave the company," Allen said. "I think that most people would call that a layoff, but whatever way you look at it, it's a job cut. We have negotiated protections for our members, including the Job Bank in the Southeast, that help cushion the blow when jobs are eliminated."
Wireline techs bear the brunt

The 1,800 newly announced AT&T job cuts affect wireline technicians who fix customer problems, install new service, and who work on AT&T's fiber expansion, Allen said. Over the past four years, AT&T expanded its fiber-to-the-home network to 12.5 million customer locations to meet a government mandate imposed on its purchase of DirecTV.

But AT&T is apparently slowing its fiber deployments now that it has finished the government-mandated buildout. "That's behind us now," AT&T Communications CEO John Donovan told FierceTelecom in an interview this month. "We'll continue to invest in fiber, but we'll do it based on the incremental, economic case. We're not running to any household target."

The union says AT&T could do much more to expand fiber access and fix problems in AT&T's degrading copper networks.

"We think there is a lot of work to be done on the network, both on repairing the existing network and in building fiber out to a lot more places in the country. Our members are well-trained and happy to do it," Allen said.

To explain the "surplus" jobs, AT&T told Ars that "nationally, we lost nearly 1.9 million wireline access lines between 2016 and 2018—a decrease of over 32 percent in just two years."

Of course, many customers who leave AT&T live in areas where the company hasn't upgraded from copper to fiber and are stuck paying high prices for slow speeds. AT&T investing more in the older parts of its network could help reduce those customer losses.

"We understand the decline in the wireline business," Allen told Ars. "But there are still lots of places across the country where AT&T could invest in building next-generation networks."

“Reduction in workload”

Leaked internal documents confirmed most of the 1,800 planned job cuts. One AT&T surplus declaration shows that more than 900 of the surplus jobs come from the company's Southeast division in Alabama, Florida, Georgia, Kentucky, Louisiana, Mississippi, North Carolina, South Carolina, and Tennessee. This document attributes most of the cuts to "economic" reasons and some to "technological/operational efficiency."

Separately, the previously mentioned letters from AT&T to CWA District 6 list about 550 job cuts in the Southwest division in Arkansas, Kansas, Missouri, Oklahoma, and Texas. The letters say that job cuts are being made "as a result of a reduction in workload."

There are also about 330 pending job cuts in AT&T's Midwest division, Allen told Ars.

The 1,800 surplus jobs are in addition to 368 announced last month in AT&T's West division, which affected some workers in Nevada and a larger number in California, Allen said.

AT&T offers wireline service in 21 states.

CWA also released four reports last week detailing AT&T wireline network problems in Wisconsin, Ohio, Michigan, and Indiana. CWA argues that AT&T is "abandoning" rural communities in these states by allowing its landline networks to fall into disrepair. CWA has been bargaining with AT&T for new contracts in these states.

"As a result of the 20 percent workforce reduction at AT&T [in Ohio], customers are experiencing poor service due to lack of plant maintenance and long waits for repairs to fix issues," CWA's report on AT&T's network in Ohio said.

AT&T told Ars that it is investigating the specific problems raised in the reports "and will make needed repairs."

AT&T cuts jobs despite government favors

AT&T in November 2017 pushed for a corporate tax cut by promising to invest an additional $1 billion in 2018, with CEO Randall Stephenson saying that "every billion dollars AT&T invests is 7,000 hard-hat jobs. These are not entry-level jobs. These are 7,000 jobs of people putting fiber in ground, hard-hat jobs that make $70,000 to $80,000 per year."

The federal tax cut was approved by Congress and President Trump and reportedly gave AT&T an extra $3 billion in cash in 2018. The Federal Communications Commission also deregulated the broadband industry and repealed net neutrality rules, with Chairman Ajit Pai claiming the move would spur new broadband investment.

AT&T is upgrading its nationwide wireless network from 4G to 5G, but even that big project isn't enough to offset declining investment in AT&T's copper and fiber home Internet networks. AT&T's capital expenditures were $5.2 billion in Q1 2019, down from $6.1 billion in Q1 2018.

At the beginning of 2018, AT&T told investors that its full-year capital expenditures would be $23 billion, including the "extra" $1 billion that AT&T claimed it would spend because of the tax cut. In reality, AT&T's capital expenditures ended up being $21.3 billion in the full year of 2018, down from $21.6 billion in 2017 and $22.4 billion in 2016.

"We have invested more in the US than any other public company over the past five years (2014-2018)—more than $130 billion in our wireless and wireline networks, including capital investments and acquisitions of wireless spectrum and operations," AT&T told Ars today.
23,000 jobs cut since end of 2017

As we've previously reported, AT&T's financial statements show that it cut more than 23,000 jobs between December 31, 2017, and March 31, 2019. AT&T's overall workforce grew from 254,000 to 262,290 in that time, but only because the telco added 31,618 people by acquiring Time Warner and other companies. Excluding jobs added via mergers, AT&T's head count declined by 23,328 even before last week's and last month's surplus announcements.

AT&T generally responds to reports of job cuts by pointing out that it is also hiring new employees in other divisions. It did so again today, saying, "We continue to hire in areas where we're seeing increasing demand for products and services. But technology is changing rapidly, and there are fewer jobs in parts of the industry that are declining and facing technology shifts, like our wireline business where these employees work."

But as Allen told Ars, "we've seen no evidence of adding jobs, and when you look at the overall numbers in their reports, they're down 23,000 employees from a year and a half ago. If they're creating these jobs, it's not clear where they are. They're not showing up in their numbers."

Chinese Cyberattack Hits Telegram App During Hong Kong Protest

Activists in both Hong Kong and mainland China often use Telegram to organize protests.
Associated Press

An encrypted messaging app said Thursday that it was hit by a powerful cyberattack from China as a major protest unfolded in Hong Kong.

The attack on the Telegram app, which slowed connectivity but did not compromise user data, came as thousands surrounded Hong Kong government headquarters on Wednesday to protest legislation that would allow people to be extradited to mainland China to stand trial. The protesters were forcibly dispersed by police using tear gas, pepper spray and rubber bullets. They did not assemble again on Thursday and debate over the legislation was delayed.

Telegram CEO Pavel Durov tweeted that most of the attackers had IP addresses from China.

"Historically, all state actor-sized (attacks) we experienced coincided in time with protests in Hong Kong," Durov said. "This case was not an exception."

Activists in both Hong Kong and mainland China often use Telegram to organize protests in hopes the encryption will allow them to evade the government surveillance of Chinese social networking apps such as WeChat.

Whereas WeChat users reported this week that photos of the protests could not be viewed, apps like Telegram offer more privacy and independence. Telegram is blocked in mainland China, but users can access it using software to circumvent the firewall, which also blocks apps and websites ranging from Facebook to The New York Times.

Encrypted messaging apps such as Telegram say that messages sent on their systems cannot be decoded by third parties during the delivery from sender to recipient. "We can ensure that no single government or block of like-minded countries can intrude on people's privacy and freedom of expression," Telegram says on its website.

Telegram said that the latest attack was a distributed denial of service in which "your servers get GADZILLIONS of garbage requests which stop them from processing legitimate requests."

The messaging app said on Wednesday evening that the system had stabilized.

The protest in Hong Kong forced the legislature to cancel its sessions Wednesday and Thursday, putting off debate on the extradition legislation.

Opponents say the bill would severely compromise their freedoms and erode Hong Kong's legal independence. Hong Kong leader Carrie Lam maintains the legislation is necessary and would have safeguards to ensure human rights are protected.

Hong Kong, a semi-autonomous Chinese territory, enjoys greater freedoms than mainland China under a "one country, two systems" framework put in place when the former British colony was returned to China in 1997. Hong Kong residents can freely surf the internet and participate in public protests, unlike in the mainland.

The U.S. government has complained for years about data breaches by China to steal high-tech information and other trade secrets — a key factor in the current trade dispute between China and the United States. Pentagon leaders told a congressional committee this month that cyberattacks from China are increasingly sophisticated.

When asked about the Telegram issue at a daily news briefing, Chinese foreign ministry spokesman Geng Shuang said he was not aware of the case but that "China always opposes any form of cyberattack."

"China is also a victim of cyberattacks," Geng said.

House Lawmakers Demand End to Warrantless Collection of Americans’ Data
Zack Whittaker

Two House lawmakers are pushing an amendment that would effectively defund a massive data collection program run by the National Security Agency unless the government promises to not intentionally collect data of Americans.

The bipartisan amendment — just 15 lines in length — would compel the government to not knowingly collect communications — like emails, messages and browsing data — on Americans without a warrant.

Reps. Justin Amash (R-MI, 3rd) and Zoe Lofgren (D-CA, 19th) have already garnered the support from some of the largest civil liberties and rights groups, including the ACLU, the EFF, FreedomWorks, New America and the Sunlight Foundation.

Under the current statute, the NSA can use its Section 702 powers to collect and store the communications of foreign targets located outside the U.S. by tapping into the fiber cables owned and run by U.S. telecom giants. But this massive data collection effort also inadvertently vacuums up Americans’ data, who are typically protected from unwarranted searches under the Fourth Amendment.

The government has consistently denied to release the number of how many Americans are caught up in the NSA’s data collection. For the 2018 calendar year, the government said it made more than 9,600 warrantless searches of Americans’ communications, up 28% year-over-year.

In a letter to lawmakers, the groups said the amendment — if passed into law — would “significantly advance the privacy rights of people within the United States.”

A coalition of tech giants — including Apple, Facebook, Google and Microsoft — also rallied behind the amendment.

“RGS believes this amendment is a step in the right direction for U.S. foreign intelligence surveillance policy,” said the Reform Government Surveillance group in a statement. (Verizon Media, which owns TechCrunch, is also a coalition member.)

Last year, Section 702 was reauthorized with almost no changes, despite a rash of complaints and concerns raised by lawmakers following the Edward Snowden disclosures into mass surveillance.

The EFF said in a blog post Tuesday that lawmakers “must vote yes in order to make this important corrective.”

The CIA Spied on People Through Their Smart TVs, Leaked Documents Reveal

Hackers from the CIA found a way to keep Samsung Smart TVs on “Fake-Off mode.”
Lorenzo Franceschi-Bicchierai

Hackers at the Central Intelligence Agency, with the help of colleagues from the British spy agency MI5, developed malware to secretly spy on targets through their Samsung Smart TVs, according to new documents published by WikiLeaks.

On Tuesday, WikiLeaks dumped a large cache of documents allegedly coming from the CIA's hacking unit. Julian Assange's organization dubbed the release, which it says it's the first in a series, as "Vault 7," and billed it as the largest-ever of confidential CIA intelligence documents.

"Weeping Angel already hooks key presses [...] to cause the system to enter Fake-Off rather than Off."

The CIA and MI5 called the project to spy on Samsung Smart TVs "Weeping Angel," perhaps a reference to Doctor Who, where weeping angels are "the deadliest, most powerful, most malevolent life-form ever produced." The malware was designed to keep the smart TVs on even when they were turned off. This was dubbed "Fake-Off mode," according to the documents. The CIA hackers even developed a way to "suppress" the TVs LED indicators to improve the "Fake-Off" mode.

"Weeping Angel already hooks key presses from the remote (or TV goes to sleep) to cause the system to enter Fake-Off rather than Off," one of the leaked document reads. "Since the implant is already hooking these events, the implant knows when the TV will be entering Fake-Off mode."

After this article was published, Samsung reacted with a statement.

"Protecting consumers' privacy and the security of our devices is a top priority at Samsung," read the statement sent via email. "We are aware of the report in question and are urgently looking into the matter."

Read more: Internet of Things Teddy Bear Leaked 2 Million Parent and Kids Message Recordings

Security researchers have long warned that smart TVs could be used to covertly tap their owner's conversations. In 2013, two white hat hackers found that several models of Samsung Smart TVs could be compromised giving attackers the chance to turn on the camera, the microphone and even control the TVs apps, such as Facebook or Skype.

Samsung itself is aware of these risks. In its privacy policy, the company warned customers to be aware that "if your spoken words include personal or other sensitive information, that information will be among the data captured and transmitted to a third party through your use of Voice Recognition." The language reminded some of the George Orwell classic dystopian novel 1984.

Once again, if something is potentially hackable, hackers will try to break into it. Or as some say, if you build it, they will come.

Samsung Tells Owners of its QLED TVs to Manually Scan for Malware Every Few Weeks

Smart TVs should be smarter
Rob Thubron

What just happened? Do you own a Samsung QLED TV? If so, the company is advising that you regularly check for malware using its built-in virus scanner. Unsurprisingly, this hasn’t gone down well with most people.

Samsung’s official Twitter account posted that scanning for ‘malware viruses’ is important to keep it running smoothly. “This also is true for your QLED TV if it's connected to Wi-Fi!” it added. The tweet included a video showing how to perform this process, which involves going to General Settings > System Manager > Smart Security > Scan.

Scanning your computer for malware viruses is important to keep it running smoothly. This also is true for your QLED TV if it's connected to Wi-Fi!

Prevent malicious software attacks on your TV by scanning for viruses on your TV every few weeks. Here's how pic.twitter.com/7hWUfJwy1K
— Samsung Support USA (@SamsungSupport) June 17, 2019

Update (12pm ET): Samsung has now deleted the somewhat controversial tweet. That doesn't make it any less relevant or accurate however.

Samsung suggests carrying out this slightly arduous task every few weeks, which many people are unlikely to do. We don’t know whether the tweet was prompted by a recently discovered threat, though there’s been no news of any new potential security vulnerabilies.

Experts have long warned that smart TVs are a ripe target for hackers, and in 2016, we saw an example of an LG smart TV infected with a version of the Cyber.Police ransomware, though LG’s instructions on how to perform a factory reset fixed the issue.

While Samsung TVs have had the ability to scan for malware for a few years now, this is the first time the company has recommended performing a manual scan every few weeks.

Aren't your operating systems based on Linux? Do you just give root access to whoever asks for it on whatever device? Why am I having to worry about the security for an operating system that requires me to enter my root password to install anything?
— Misinko (@Mr_Misinko) June 17, 2019

Back at the start of the year, Samsung announced it was extending its contract to have McAfee antivirus software pre-installed on all its smart televisions produced in 2019.

Twitter has been awash with responses to Samsung’s suggestion, with several users asking the obvious question: why isn’t the virus scan performed automatically?

Not sure where to start... that this is needed in the first place, or that it isn’t done automatically. And could a virus subvert this scan? This TV isn’t sounding so “smart” or “intelligent” #InternetOfShit
— Ken Brucker (@KnBrckr) June 17, 2019


The UK Porn Block is Being Delayed. Again.
Isobel Asher Hamilton

• The UK porn block has been delayed for six months, the British government has confirmed.
• The block, which would force porn sites to implement systems verifying users are over 18, was supposed to come into force on July 15.
• It has already been delayed once, as it was meant to roll out in April 2018.

The UK's impending porn age-block is to be postponed for six months due to a bureaucratic tussle with the European Union.

Sky News first reported that the block was to be delayed on Thursday morning, and Culture Secretary Jeremy Wright then confirmed the delay in the House of Commons.

The legislation behind the porn block was introduced in 2017 as part of the Digital Economy Act. It was originally supposed to roll out in April 2018, but was subsequently delayed until July 15 of this year.

The new rules would force porn websites to implement systems verifying their users are over 18, or risk being blocked in the UK. In practice, this would mean anyone wanting to watch porn online would need to prove they are over 18.

Read more: The maker of the new UK 'porn pass' scrapped the idea of selling it through Amazon because its age-verification wasn't good enough

The fresh delay comes after the Department for Digital, Culture, Media, and Sport failed to notify the European Commission of the guidance it drew up for the British Board of Film Classification (BBFC), the body which was selected to regulate the porn block. Wright said that he was informed of the administrative oversight on Friday of last week.

The legislation left it up to the porn sites themselves to work out how to implement their age-verification. Solutions proposed included third-party verification via uploaded photo ID, scanning users' faces to biometrically guess their age, and even a so-called "porn pass" – a voucher which users could obtain from a shop by showing their ID.

The block has received considerable pushback from privacy campaigners who say the legislation was irresponsible, since users' identities could potentially be linked to the porn they watch and would be vulnerable to surveillance or a data breach.

Jim Killock, the executive director of Open Rights Group (ORG) and one of the block's main opponents, told Business Insider in a statement:

"While it's very embarrassing to delay age verification for the third time, this is an opportunity for the government to address the many problems that this ill-thought through policy poses. Age verification providers have warned that they are not ready; the BBFC's standard to protect data has been shown to be ineffective. "

The BBFC released its non-compulsory age-verification data protection certificate scheme in April. Sites awarded the certificate would be able to show a green "AV" symbol. Last week, ORG published a report saying the certificate could offer little reassurance to consumers, as it was both vague and voluntary for porn sites to adopt.

"The government needs to use this delay to introduce legislation that will ensure the privacy and security of online users is protected," said Killock.

Speaking in the Commons, Jeremy Wright said although he apologised for the delay, his apology did not signal a change in policy.

"Age-verification for online pornography needs to happen, and I believe it is the clear will of the house and those we represent that it should, and in the clear interests of our children that it must," said Wright.

Jim Balsillie : ‘Data is Not the New Oil – it’s the New Plutonium’

Lawmakers told technology is disrupting governance and if left unchecked could render liberal democracy obsolete

Jim Balsillie, retired co-CEO of Research In Motion and chair of the Centre for International Governance Innovation, testified today at the hearings of the International Grand Committee on Big Data, Privacy and Democracy being held in Ottawa. Politicians from Canada and 10 other countries have gathered to consider how best to protect citizens’ privacy and their democracies in the age of big data and social media. Here are his prepared remarks

Committee Members;

It is my pleasure to testify today to such distinguished public leaders. Data governance is the most important public policy issue of our time. It is cross-cutting, with economic, social and security dimensions. It requires both national policy frameworks and international coordination.

I would like to start by acknowledging the work of the Canadian members of this Committee. Over the past 3 years, Mr. Zimmer, Mr. Angus and Mr. Erskine-Smith spearheaded a bipartisan effort to deal with data governance. I’m inspired by the seriousness and integrity they bring to this task.

The perspective that I bring today is that of a capitalist and global tech entrepreneur for 30 years and counting. I am the retired Chairman and co-CEO of Research In Motion, a Canadian technology company we scaled from an idea to $20 billion in sales.

While most are familiar with the iconic BlackBerry smartphone, ours was actually a platform business that connected tens of millions of users to thousands of consumer and enterprise applications, via some 600 cellular carriers, in over 150 countries. We understood how to leverage Metcalfe’s law of network effects to create a category-defining company. So I’m deeply familiar with multi-sided platform business model strategies as well as navigating the interface between business and public policy.

I’ll start with several observations about the nature, scale and breadth of our collective challenge here.

Disinformation and fake news are just two of the many negative outcomes from unregulated attention-based business models. They cannot be addressed in isolation. They have to be tackled horizontally, as part of an integrated whole. To agonize over social media’s role in proliferation of online hate, conspiracy theories, politically motivated misinformation and harassment is to miss the root and scale of the problem.

Second, social media’s toxicity is not a bug — it’s a feature. Technology works exactly as designed. Technology products, services and networks are not built in a vacuum. Usage patterns drive product development decisions. Behavioral scientists involved with today’s platforms helped design user experiences that capitalize on negative reactions because they produce far more engagement than positive reactions.

Third, among the many valuable insights provided by whistleblowers inside the tech industry is this quote: “the dynamics of the attention economy are structurally set up to undermine the human will.” Democracy and markets work when people can make choices aligned with their interests. The online advertisement-driven business model subverts choice and represents a foundational threat to markets, election integrity and democracy itself.

Fourth, technology gets its power through control of data. Data at the micro-personal level gives technology unprecedented power to influence. Data is not the new oil – it’s the new plutonium. Amazingly powerful, dangerous when it spreads, difficult to clean up and with serious consequences when improperly used. Data deployed through next generation 5G networks is transforming passive infrastructure into veritable digital nervous systems.

Our current domestic and global institutions, rules, and regulatory frameworks are not designed to deal with any of these emerging challenges. Because cyberspace knows no natural borders, the digital transformation’s effects cannot be hermetically sealed within national boundaries. International coordination is critical. With these observations in mind, here are my six recommendations for your consideration:

1. Eliminate tax deductibility of specified categories of online ads. We need to zero in on the core problem: the attention-based advertisement-driven business model. Subscription business models are much less prone to poisonous manipulation. Taxes create powerful incentives. In Canada, we do not allow tax deductibility for foreign offline advertising. This approach should be generalized so that tax incentives favour subscription models for online services.
2. Ban personalized online advertising for elections. We are dealing with the largest, most centralized form of attention control in human history. Online platforms have mastered behaviour modification and this kind of tool for manipulation is not something we want for sale to the highest bidder during an election. Official elections are a short period of time and the income earned from advertising is trivial to large social media companies. But as the Brexit referendum has demonstrated, the social cost of compromising election integrity is enormous.
3. Implement strict data governance regulations for political parties. This includes at least two things. 1. Apply privacy regulations to political parties regarding access to personally identifiable information. 2. Require transparency of all commercial and technical relationships between political parties and social media companies. The fact that Canadian political parties are still not subject to privacy regulations deeply troubles me.
4. Provide effective whistleblower protections. Some of the most valuable information the public has learned about the abuse of data has come from brave whistleblowers. Make sure whistleblower protection extends to both private sector and governmental activities.
5. Add explicit personal liability alongside corporate responsibility to affect CEO and Board of Director decision-making. To strengthen adherence to existing regulations, consider adding annual signed CEO and Board certifications similar to those required for Sarbanes-Oxley compliance. This 2002 Act was designed to better protect investors by improving the accuracy and reliability of corporate disclosures in the wake of various accounting scandals. As a businessman, I can assure you that when a senior executive or board member must affix their name to a document that has personal liability, this immediately changes behaviour to one of greater prudence and caution.
6. Create a new institution for likeminded nations to address digital cooperation and stability. The data-driven economy’s effects cannot be contained within national borders. New approaches to international coordination and enforcement are critical as policymakers develop new frameworks to preserve competitive markets and democratic systems that evolved over centuries under profoundly different technological conditions. We have arrived at a new Bretton Woods moment. We need new or reformed rules of the road for digitally mediated global commerce – a World Trade Organization 2.0. In the aftermath of the 2008 financial crisis, the Financial Stability Board was created to foster global financial cooperation and stability. A similar global institution, say the ‘Digital Stability Board’, is needed to deal with the challenges posed by digital transformation. The nine countries on this Committee could constitute founding members of such a plurilateral body, which would undoubtedly grow over time.

Technology is disrupting governance and if left unchecked could render liberal democracy obsolete. By displacing the print and broadcast media in influencing public opinion, technology is becoming the new Fourth Estate. In our system of checks and balances, this makes technology co-equal with the executive, the legislature, and the judiciary. When this new Fourth Estate declines to appear before this Committee — as Silicon Valley executives are currently doing — it is symbolically asserting this aspirational co-equal status. But it is asserting this status and claiming its privileges without the traditions, disciplines, legitimacy or transparency that checked the power of the traditional Fourth Estate. The work of this International Grand Committee is a vital first step towards redress of this untenable current situation.

Thank you.


Until next week,

- js.

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