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Old 04-06-08, 07:15 AM   #1
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Join Date: May 2001
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Default Peer-To-Peer News - The Week In Review - June 7th, '08

Since 2002

"If your email crosses our border, we tap it." – Sweden

"We intend to vigorously defend ourselves against this shake down attempt by the major label cabal." – Pablo Soto

"Honestly, it's becoming clearer and clearer that the entertainment industry is an existential threat to the idea of free speech, open tools, and an open communications network." – Cory Doctorow

"I slept in my clothes, because the last time they came [to bust me], I was in my underwear with my dong hanging out and shit. I wish I was a minor right now because this is going to be really bad." – Comcast hacker Defiant

"If he wasn't such a prick, he could have avoided all of that. I wasn't even really thinking. Plus, I'm just so mad at Comcast. I'm tired of their shitty service." – Comcast hacker EBK

"Comcast is just a huge corporation, and we wanted to take them out, and we did." – Defiant

"There will be no media consumption left in 10 years that is not delivered over an IP network. There will be no newspapers, no magazines that are delivered in paper form. Everything gets delivered in an electronic form." – Steve Balmer

"The average 14-year-old can hear more music in a month than someone would have heard in an entire lifetime just 300 years ago." – Dan Levitin

"Google vice president Sukhinder Singh Cassidy predicts that in seven years, every song ever recorded in the world will fit into our pockets." – Karla Starr

"Let today be the pirates independence day! Today we celebrate the victories we’ve had and the victories that will come. Today we celebrate that we’re united in our efforts. Keep on seeding." – The Pirate Bay team

"I'm not going to make Nelson Mandela a white guy." – Clint Eastwood

June 14th, 2008

Op-Ed Columnist

Bits, Bands and Books
Paul Krugman

Do you remember what it was like back in the old days when we had a New Economy? In the 1990s, jobs were abundant, oil was cheap and information technology was about to change everything.

Then the technology bubble popped. Many highly touted New Economy companies, it turned out, were better at promoting their images than at making money — although some of them did pioneer new forms of accounting fraud. After that came the oil shock and the food shock, grim reminders that we’re still living in a material world.

So much, then, for the digital revolution? Not so fast. The predictions of ’90s technology gurus are coming true more slowly than enthusiasts expected — but the future they envisioned is still on the march.

In 1994, one of those gurus, Esther Dyson, made a striking prediction: that the ease with which digital content can be copied and disseminated would eventually force businesses to sell the results of creative activity cheaply, or even give it away. Whatever the product — software, books, music, movies — the cost of creation would have to be recouped indirectly: businesses would have to “distribute intellectual property free in order to sell services and relationships.”

For example, she described how some software companies gave their product away but earned fees for installation and servicing. But her most compelling illustration of how you can make money by giving stuff away was that of the Grateful Dead, who encouraged people to tape live performances because “enough of the people who copy and listen to Grateful Dead tapes end up paying for hats, T-shirts and performance tickets. In the new era, the ancillary market is the market.”

Indeed, it turns out that the Dead were business pioneers. Rolling Stone recently published an article titled “Rock’s New Economy: Making Money When CDs Don’t Sell.” Downloads are steadily undermining record sales — but today’s rock bands, the magazine reports, are finding other sources of income. Even if record sales are modest, bands can convert airplay and YouTube views into financial success indirectly, making money through “publishing, touring, merchandising and licensing.”

What other creative activities will become mainly ways to promote side businesses? How about writing books?

According to a report in The Times, the buzz at this year’s BookExpo America was all about electronic books. Now, e-books have been the coming, but somehow not yet arrived, thing for a very long time. (There’s an old Brazilian joke: “Brazil is the country of the future — and always will be.” E-books have been like that.) But we may finally have reached the point at which e-books are about to become a widely used alternative to paper and ink.

That’s certainly my impression after a couple of months’ experience with the device feeding the buzz, the Amazon Kindle. Basically, the Kindle’s lightness and reflective display mean that it offers a reading experience almost comparable to that of reading a traditional book. This leaves the user free to appreciate the convenience factor: the Kindle can store the text of many books, and when you order a new book, it’s literally in your hands within a couple of minutes.

It’s a good enough package that my guess is that digital readers will soon become common, perhaps even the usual way we read books.

How will this affect the publishing business? Right now, publishers make as much from a Kindle download as they do from the sale of a physical book. But the experience of the music industry suggests that this won’t last: once digital downloads of books become standard, it will be hard for publishers to keep charging traditional prices.

Indeed, if e-books become the norm, the publishing industry as we know it may wither away. Books may end up serving mainly as promotional material for authors’ other activities, such as live readings with paid admission. Well, if it was good enough for Charles Dickens, I guess it’s good enough for me.

Now, the strategy of giving intellectual property away so that people will buy your paraphernalia won’t work equally well for everything. To take the obvious, painful example: news organizations, very much including this one, have spent years trying to turn large online readership into an adequately paying proposition, with limited success.

But they’ll have to find a way. Bit by bit, everything that can be digitized will be digitized, making intellectual property ever easier to copy and ever harder to sell for more than a nominal price. And we’ll have to find business and economic models that take this reality into account.

It won’t all happen immediately. But in the long run, we are all the Grateful Dead.

British Police Confirm Six OiNK Users Arrested

British Police have just confirmed that several users of BitTorrent site OiNK were arrested recently. TorrentFreak broke the news last Friday after sitting on the story for a while but the mainstream press have been holding back over the weekend, waiting for confirmation. Just seconds ago, confirmation came.

Last week TorrentFreak reported that Cleveland Police had arrested a user of OiNK, who was questioned and later released on police bail.

We also discovered that other people had been arrested and deduced from our sources that this police action was taken against alleged pre-release uploaders - those that share before the retail date.

A few minutes ago in an email to TorrentFreak, Cleveland Police confirmed that a total of six individuals were arrested, all in connection with the uploading of pre-release music.

Three of the arrests were made on Friday 23rd May and three more on Wednesday 28th May. The arrested individuals are five men aged between 19 and 33, and a 28-year-old woman.

Suspects were taken to their local police station for questioning and required to provide DNA samples and fingerprints. According to our sources, they were arrested on suspicion of “Conspiracy to Defraud the Music Industry” although this hasn’t yet been confirmed by the police.

We can confirm that at least two of the arrests are for the alleged uploading of a single album. All have been bailed pending further enquiries.

Update: The Register contacted the BPI who gave this statement:

The BPI and IFPI worked with the police in order to close down the OiNK tracker site last October. The illegal online distribution of music, particularly pre-release, is hugely damaging, and as OiNK was the biggest source for pre-releases at the time we moved to shut it down. We provided the information to assist this investigation, but this is now a police matter and we are unable to comment further at this stage.

Tories Eye $500 Fine for Illegal Downloads
David George-Cosh

The federal Conservatives are set to introduce new copyright legislation as soon as this week that will include provisions to target users with a $500 fine for all illegal files transferred online, a move that legal experts say could see Canadians sued for hundreds of thousands of dollars if found guilty of infringement.

Multiple sources familiar with the matter have told the National Post that one of the provisions in the government's updated Copyright Act of Canada will include a fine for each "personal use download" found to be shared online through peer-to-peer software programs.

Other provisions in the bill, which is said to be tabled to the House of Commons tomorrow afternoon, will include measures to make it illegal to unlock cellphones or copy music from protected CDs to iPods as well as making it illegal to copy "time shifted" shows onto personal video recorders if flagged by broadcasters.

The current Copyright Act charges a maximum $20,000 fine for each infringed material, but experts say the act was designed primarily for commercial cases and not to accommodate how digital copyrighted files are handled by individuals.

The push to update the Copyright Act to reflect the current digital climate has been an eventful -- yet slow -- campaign. It has not been amended since 1997 although prior attempts to draw it in line following the ratification of the 1996 World Intellectual Property Organization Performances and Phonograms Treaty have failed. Another attempt by the Conservative government to introduce updated copyright legislation this past December failed following an outpouring of protest by grassroots organizations across Canada over fears the bill would fall in line with harsh U.S. copyright laws.

"The core really is a desire to satisfy U.S. pressure by enacting something very close to the U.S. Digital Millenium Copyright Act," said University of Ottawa law professor Michael Geist, an expert in Internet commerce issues.

"The irony here is that while file sharing could be held up as the prime rationale for new legislation, the reality is that individual Canadians and the everyday products they purchase are going to be most deeply affected," he said, citing CDs and DVDs as examples of items that will likely have restrictions placed on their usage.

Critics have said the U.S. copyright bill is ineffective in enforcing infringement and sends the wrong message to consumers. The bill was cast in a prominent light following a civil case in Minnesota that ruled a single mother had to pay the Recording Industry Association of America a $222,000 fine for 24 cases of copyright infringement.

To date, Canadians have not been sued for sharing illegal digital material following a ruling by the Federal Court of Appeal in 2004, which denied a request from the Canadian Recording Industry Association to force Internet service providers to subpoena its customers suspected of sharing infringed material based on weak evidence and privacy concerns.

Although it is unclear how the government will enforce the new legislation, Mr. Geist said a new bill would create an "open invitation" for lawsuits to be filed against illegal file sharers.

David Zitzerman, an entertainment lawyer with Goodmans LLP, said the legal protection for technology protection measures in Canada has been a "real lightning rod" of debate between consumers and content producers.

"On one hand you have the rights owners that feel that for e-commerce to really flourish on the Internet they need these protection measures," Mr. Zitzerman said. "But you also have consumer groups and others who feel it will affect free speech [or] will curtail the rights that people feel they are entitled to as owners of the materials."

A source with direct knowledge of the government's planned bill said the act was written with the consultation of a number of stakeholders to soften the impact the controversial legislation's release will have on the Canadian public.

"They have a sense that no one's going to be happy; they can't make everyone happy, but I think it's a balanced approach," the source said.

"[Industry Canada] has really taken account of everything from people that come up with ideas on their blogs right up to musicians. The spectrum is really broad."

The source said the new act is being finalized by the Prime Minister's Office. Industry Canada declined to provide a date for the controversial bill's introduction to Parliament.

"Minister Prentice has said we will introduce legislation when he and Heritage Minister [Josée] Verner are satisfied that the bill has struck the appropriate balance between the rights of consumers and those of creators," an Industry Canada spokeswoman said in an e-mail.

Major Record Labels Sue Spanish P2P Pioneer Pablo Soto, MP2P Technologies, Suit Seeks $20mm USD

Lawsuit, Believed to be Unprecedented, Claims "Unfair Competition"
Press release

Madrid, Spain (PRWEB) June 5, 2008 -- MP2P Technologies (http://www.mp2p.net/) announced today that it has been served with a lawsuit from what remains of the four major record labels. The lawsuit, WARNER MUSIC SPAIN S.A., UNIVERSAL MUSIC SPAIN, S.A., EMI MUSIC SPAIN, S.A., SONY BMG MUSIC ENTERTAINMENT, S.A., PRODUCTORES DE MUSICA EN ESPANA (PROMUSICAE) v. PABLO SOTO BRAVO, OPTISOFT, S.L., PIOLET NETWORKS, S.L., MP2P TECHNOLOGIES, S.A. (filed in Madrid, Administracion de Justica, # 2807910001898), seeks $20mm in alleged damages from the technology upstart.

"We intend to vigorously defend ourselves against this shake down attempt by the major label cabal," said Pablo Soto, founder and CEO of MP2P Technologies. "Rather than embracing technology, they have chosen a path that will ultimately lead to their own demise, as evidenced by the label's consistent decline over the past decade. Litigation is in itself not a valid business model for them, however, it has been a dogged and futile pursuit of theirs since the advent of P2P."

The Inexact Science Behind DMCA Takedown Notices
Brad Stone

A new study from the University of Washington suggests that media industry trade groups are using flawed tactics in their investigations of users who violate copyrights on peer-to-peer file sharing networks.

Those trade groups, including the Motion Picture Association of America (M.P.A.A.) Entertainment Software Association (E.S.A.) and Recording Industry Association of America (R.I.A.A.), send universities and other network operators an increasing number of takedown notices each year, alleging that their intellectual property rights have been violated under the Digital Millennium Copyright Act.

Many universities pass those letters directly on to students without questioning the veracity of the allegations. The R.I.A.A. in particular follows up some of those notices by threatening legal action and forcing alleged file-sharers into a financial settlement.

But the study, released today by Tadayoshi Kohno, an assistant professor, Michael Piatek a graduate student, and Arvind Krishnamurthy, a research assistant professor, all at the University of Washington, argues that perhaps those takedown notices should be viewed more skeptically.

The paper finds that there is a serious flaw in how these trade groups finger alleged file-sharers. It also suggests that some people might be getting improperly accused of sharing copyrighted content, and could even be purposely framed by other users.

In two separate studies in August of 2007 and May of this year, the researchers set out to examine who was participating in BitTorrent file-sharing networks and what they were sharing. The researchers introduced software agents into these networks to monitor their traffic. Even though those software agents did not download any files, the researchers say they received over 400 take-down requests accusing them of participating in the downloads.

The researchers concluded that enforcement agencies are looking only at I.P. addresses of participants on these peer-to-peer networks, and not what files are actually downloaded or uploaded—a more resource-intensive process that would nevertheless yield more conclusive information.

In their report, the researchers also demonstrate a way to manipulate I.P. addresses so that another user appears responsible for the file-sharing.

An inanimate object could also get the blame. The researchers rigged the software agents to implicate three laserjet printers, which were then accused in takedown letters by the M.P.A.A. of downloading copies of “Iron Man” and the latest Indiana Jones film.

“Because current enforcement techniques are weak, it is possible that anyone, regardless of sharing content or using BitTorrent, could get a D.M.C.A. takedown notice claiming they were committing copyright infringement,” said Mr. Piatek.

In their paper, the researchers argue for greater transparency and public review of Big Media’s intellectual property enforcement actions.

“Our study scientifically shows that flaws exists,” said Mr. Kohno, an assistant professor in the university’s Computer Science and Engineering department. “It’s impossible to prove that other flaws don’t exist, especially since current industry practices are so shrouded in mystery. Ultimately, we think that our results should provide a wake-up call for more openness on the parts of content enforcers.”

Secret Super-Copyright Treaty Leaked
Cory Doctorow

Wikileaks has the full text of the dread Anti-Counterfeiting Trade Agreement, a draft treaty that does away with those pesky public trade-negotiations at the United Nations (with participation from citizens' groups and public interest groups) in favor of secret, closed-door meetings where entertainment industry giants get to give marching orders to governments in private.

It's some pretty crazy reading -- among other things, ACTA will outlaw P2P (even when used to share works that are legally available, like my books), and crack down on things like region-free DVD players. All of this is taking place out of the public eye, presumably with the intention of presenting it as a fait accompli just as the ink is drying on the treaty.

Honestly, it's becoming clearer and clearer that the entertainment industry is an existential threat to the idea of free speech, open tools, and an open communications network.

Who is really behind ACTA? Follow the money:

Rep. Howard Berman (D-CA)[4]

Top four campaign contributions for 2006:
Time Warner $21,000
News Corp $15,000
Sony Corp of America $14,000
Walt Disney Co $13,550

Top two Industries:
TV/Movies/Music $181,050
Lawyers/Law Firms $114,200
Other politicians listed also show significant contributions from IP industries.
Link (Thanks, Espen!)

Consumer Groups Voice Concern Over Potential Digital Copyright Bill

New U.S.-style legislation could impose serious penalties for illegal downloading
CBC News

A coalition of consumer groups has waded into the copyright reform debate, calling on the federal government to avoid introducing legislation that will limit consumer rights.

In a letter sent Thursday to Minister of Industry Jim Prentice and Minister of Heritage Josée Verner, the groups said "adapting copyright laws to the modern world and to modern technologies should in no way limit or undermine existing consumer rights or constrain common consumer practices."

They also said technologies that undermine existing consumer rights should be illegal.

The coalition includes members from the Union des consommateurs, Option consommateurs, Consumers Council of Canada, Public Interest Advocacy Centre (PIAC), the Canadian Internet Policy and Public Interest Clinic (CIPPIC) and Online Rights Canada (OnlineRights.ca).

Their letter comes in response to speculation the government may be close to introducing a bill that could impose serious penalties for illegal downloading.

Critics say the bill will likely mirror the U.S. Digital Millennium Copyright Act, which has drawn considerable criticism south of the border, primarily for opening the door to huge lawsuits by record labels against people who have downloaded music illegally.

The bill was also expected to contain provisions that would have made it illegal to time shift television shows using a Personal Video Recorder, or copy files to CDs and MP3 players.

After reports suggested the updated copyright bill would be introduced this week, Prentice told the House of Commons in Ottawa on Wednesday he would not introduce legislation until he is satisfied it takes into account the rights of both consumers and copyright holders.

But the coalition said that while government has consulted with industry groups, consumer groups have yet to be given a chance to voice their opinion.

Michael Geist, the Canada research chair of internet and e-commerce law at the University of Ottawa and a frequent critic of many of the provisions expected to be introduced, wrote in his blog Thursday that the coalition's letter shows that consumer groups are being left out of the process.

"The letter confirms what has been widely feared — the recording industry may have received assurances of a bill, yet Industry Minister Jim Prentice has still not consulted with Canadian consumer groups," he wrote.

Prentice delayed plans to introduce the bill in December after a chorus of opposition sprang up to provisions the legislation reportedly contained. At the time, more than 20,000 people signed up to a protest group on social networking site Facebook, which has since doubled to more than 40,000 members.

A number of prominent Canadian artists including the Barenaked Ladies, Sarah McLachlan and Avril Lavigne opposed restrictive copyright reform through the Canadian Music Creators Coalition, which was at odds with the Alliance of Canadian Cinema, Television and Radio Artists, the official union for Canada's English-language performers. ACTRA has urged Prentice to speed up reformed legislation.

The Business Coalition for Balanced Copyright, a group that includes Google, Yahoo, Rogers, Telus, the Canadian Association of Broadcasters and the Retail Council of Canada, among others, also announced its opposition to a U.S.-style digital copyright act in February.

High-Speed Internet: Ofcom to Introduce Code for Broadband Adverts
Bobbie Johnson

Connection speeds decline the farther customers are from their nearest telephone exchange

Broadband providers are being asked to sign up to a new code of conduct in order to prevent consumers being missold high-speed internet packages.

Media regulator Ofcom announced today that it would be introducing a new voluntary code of practice for ISPs in an attempt to prevent confusion over high-speed connections.

Broadband advertising has been controversial because ISPs often promote the theoretical maximum speeds achievable, rather than the typical speeds most customers can reach.

The code will introduce a number of measures to help customers, including better information on realistic speeds, support for those who discover that advertised speeds are not available in their area and wish to move to a lower speed package, and better training for sales staff.

Earlier this year a survey by the website Broadband Expert found that actual speeds were often less than half those advertised, leading Ofcom to warn that it was prepared to enforce regulation if the industry did not fall into line.

"Broadband is a thriving market in the UK," said Ed Richards, Ofcom's chief executive. "We want to encourage real clarity for consumers about the actual broadband speeds they can receive. This voluntary code is a significant step in this direction."

More than 30 ISPs have already signed up to the code, which was drafted in conjunction with the industry body the ISPA.

In a statement the organisation said that it would "support the principle" behind the code, but reiterated its argument that measuring internet speeds remained problematic.

"Consumers must also understand that every single broadband connection's speed will be different," it said. "Even neighbouring houses supplied by the same provider can receive different speeds."

The regulator is also set to undertake a comprehensive survey of broadband speeds across Britain as part of an attempt to determine how accurate advertising has been. A survey earlier this week found that there were large discrepancies between speeds in large cities such as London and other parts of the country.

New Filings Reveal Extent, Damage of Bell Canada Throttling
Nate Anderson

Just how bad it is Bell Canada's P2P traffic filtering? Not bad at all, so long as you're happy having your 5Mbps DSL link operate at half the speed of a dial-up modem. That's the assertion of a group of small Canadian ISPs that are asking Canada's telecoms regulator to intervene and force Bell to call off its deep packet inspection dogs.

The Canadian Association Internet Providers (CAIP) represents smaller firms that generally purchase wholesale capacity from Bell Canada and resell it under their own brand. When Bell applied its filtering system to this wholesale traffic earlier this year, the operators were outraged, especially as several of them explicitly offered "no throttle" guarantees to customers that they now could not keep.

In documents filed late last week with the Canadian Radio-television and Telecommunications Commission (CRTC), CAIP provided evidence showing that the traffic-shaping system used by Bell limits downstream P2P rates to around 30Kbps during peak times. But those "peak times" aren't just a couple of hours in the evening; they extend from 4:30 PM until 2 AM every day, or 9.5 hours out of each 24.

As CAIP dryly notes, the speed limit "represents a tiny fraction of the 5Mbps downstream data transfer rate" advertised by Bell.

Bell's system appears to be nothing if not effective, though. A look at the graph above shows what happens to BitTorrent bandwidth at exactly 2 AM. The image comes courtesy of a TDCNet employee who was downloading a legal copy of Fedora during that time and who saw his bandwidth surge immediately to 450Kbps once Bell Canada let up on the throttle.

CAIP concludes, "It is fair to say that, in general, for up to 10 hours a day, every single day, customers using applications or accessing content that are targeted (either intentionally or collaterally) by Bell's traffic shaping measures are substantially restricted from enjoying the full benefit of the service for which they have contracted."

The reference to collateral damage is further explained in another filing in which CAIP says that Bell Canada's DPI system is far too aggressive and often filters non-P2P protocols. According to CAIP's research, users that start P2P clients are "flagged" for throttling, and once the flag is set, it actually affects everything from SSH to VoIP.

One unnamed CAIP member did an experiment, showing a 500Kbps download speed on SSH transfers and 4.5Mbps downstream using VoIP speed test software. After firing up a P2P client during the peak hours, then shutting it back down, the member found that SSH speed was now reduced to 30Kbps, as was VoIP. The member concluded that this fit with what he had heard, namely that "once a connection has been flagged as a P2P user, all traffic that is not white-listed is throttled."

Bell: We're saving hundreds of thousands from congestion

Not surprisingly, Bell Canada insists that its system is highly accurate, only throttles P2P, and that all complaints it has seen can be chalked up to other network problems. Its comments largely focus on the need for a DPI-based throttling solution, and the company claims that a full 700,000 users would experience congestion problems by next year if Bell did not roll out its solution.

To prove the point, Bell filed a chart showing the history of "network cell loss" on its ATM-based DSL network (the company is currently building a fiber-to-the-node DSL network, but most of its customers still use the older, more expensive ATM technology). Packets are broken up into cells for routing on an ATM network, and when capacity limits are reached and buffers are exceeded, cells will start to be dropped. When this happens, the entire packet becomes unusable and has to be retransmitted. Since 2002, as usage has soared, these loss events have also increased dramatically.

In laying out its plans for dealing with congestion problems, Bell described a three-pronged approach that includes capacity building, usage-based pricing, and traffic shaping in combination to keep the network operational. "The most logical solution to the congestion problem is to invest the money in expanding the capacity of the network," wrote the company in a CRTC filing. It pointed out that, since 2001, it has spent more than CAN$3 billion in upgrading its infrastructure, and it plans to spend another CAN$500 million in 2008.

But Bell insists that there is no way to build enough capacity to address the issue. Just as highway builders have found that increasing the number of lanes does not translate in the long term into less congestion (because the bigger roads encourage more use), Bell argues that "the nature of the growth of Internet traffic is that as network capacity expands, new user applications invariably also grow to utilize that capacity."

The company certainly could address the problem through buildouts by creating a network that can handle the peak load being advertised to each customer. No network company builds its systems this way, however, due to the cost and the fact that much of the time, this capacity would simply go unused.

Or, translated into highway analogies once more, Bell's Mirko Bibic told the CBC, "If you have a two-lane highway and you have congestion at rush hour, you're not going to build 20 lanes because those 18 other lanes just won't be needed during non-rush periods. So what do you do? You build a couple of extra lanes for one, you expand infrastructure. As well, you do things like a bus lanes that allow buses, taxis, and cars with more than three passengers to travel on them so that they get faster service ban if you choose to drive your Escalade and you're alone on the highway."

Bell claims it is doing the best job it can, though it does admit that it should have given more notification to the ISPs before throttling their users. In bureaucratic speak, this takes the form of saying, "The Company acknowledges the frustration of some of the Applicants' members and has apologized to its wholesale GAS customers." In the future, Bell will give notice of such changes "on the day of implementation, at the latest."

Much of the good stuff, including many specific numbers, was filed confidentially with the CRTC, but at least the regulator now has far more detailed information with which to make a judgment. That judgment, about whether the government should get involved in the entire P2P throttling debate, will likely be made by the end of the summer, but Bell certainly could not have helped its assertion that congestion is a huge problem by opening its own (non-P2P) video download store last week.

Time Warner Cable Tries Metering Internet Use
Peter Svensson

You're used to paying extra if you use up your cell phone minutes, but will you be willing to pay extra if your home computer goes over its Internet allowance?

Time Warner Cable Inc. customers — and, later, others — may have to, if the company's test of metered Internet access is successful.

On Thursday, new Time Warner Cable Internet subscribers in Beaumont, Texas, will have monthly allowances for the amount of data they upload and download. Those who go over will be charged $1 per gigabyte, a Time Warner Cable executive told the Associated Press.

Metered billing is an attempt to deal fairly with Internet usage, which is very uneven among Time Warner Cable's subscribers, said Kevin Leddy, Time Warner Cable's executive vice president of advanced technology.

Just 5 percent of the company's subscribers take up half of the capacity on local cable lines, Leddy said. Other cable Internet service providers report a similar distribution.

"We think it's the fairest way to finance the needed investment in the infrastructure," Leddy said.

Metered usage is common overseas, and other U.S. cable providers are looking at ways to rein in heavy users. Most have download caps, but some keep the caps secret so as not to alarm the majority of users, who come nowhere close to the limits. Time Warner Cable appears to be the first major ISP to charge for going over the limit: Other companies warn, then suspend, those who go over.

Phone companies are less concerned about congestion and are unlikely to impose metered usage on DSL customers, because their networks are structured differently.

Time Warner Cable had said in January that it was planning to conduct the trial in Beaumont, but did not give any details. On Monday, Leddy said its tiers will range from $29.95 a month for relatively slow service at 768 kilobits per second and a 5-gigabyte monthly cap to $54.90 per month for fast downloads at 15 megabits per second and a 40-gigabyte cap. Those prices cover the Internet portion of subscription bundles that include video or phone services. Both downloads and uploads will count toward the monthly cap.

A possible stumbling block for Time Warner Cable is that customers have had little reason so far to pay attention to how much they download from the Internet, or know much traffic makes up a gigabyte. That uncertainty could scare off new subscribers.

Those who mainly do Web surfing or e-mail have little reason to pay attention to the traffic caps: a gigabyte is about 3,000 Web pages, or 15,000 e-mails without attachments. But those who download movies or TV shows will want to pay attention. A standard-definition movie can take up 1.5 gigabytes, and a high-definition movie can be 6 to 8 gigabytes.

Time Warner Cable subscribers will be able to check out their data consumption on a "gas gauge" on the company's Web page.

The company won't apply the gigabyte surcharges for the first two months. It has 90,000 customers in the trial area, but only new subscribers will be part of the trial.

Billing by the hour was common for dial-up service in the U.S. until AOL introduced an unlimited-usage plan in 1996. Flat-rate, unlimited-usage plans have been credited with encouraging consumer Internet use by making billing easy to understand.

"The metered Internet has been tried and tested and rejected by the consumers overwhelmingly since the days of AOL," information-technology consultant George Ou told the Federal Communications Commission at a hearing on ISP practices in April.

Metered billing could also put a crimp in the plans of services like Apple Inc.'s iTunes that use the Internet to deliver video. DVD-by-mail pioneer Netflix Inc. just launched a TV set-top box that receives an unlimited stream of Internet video for as little as $8.99 per month.

Comcast Corp., the country's largest cable company, has suggested that it may cap usage at 250 gigabytes per month. Bend Cable Communications in Bend, Ore., used to have multitier bandwidth allowances, like the ones Time Warner Cable will test, but it abandoned them in favor of an across-the-board 100-gigabyte cap. Bend charges $1.50 per extra gigabyte consumed in a month.
http://news.yahoo.com/s/ap/20080602/...iLx4HOis 0NUE

AT&T Embraces BitTorrent, May Consider Usage-Based Pricing
Dylan Tweney

AT&T's new chief technical officer, John Donovan, wants you to know that his company does not, under any circumstances, slow down BitTorrent users or throw other monkey wrenches in the operation of specific applications.

"No. Never have. No interest in it. It's never been our policy," Donovan told Wired.com when asked if AT&T engaged in packet shaping (the process of slowing down or blocking certain applications' data packets to render them less efficient).

The statement stands in contrast to other ISPs, such as Comcast, which has, a lawsuit alleges, blocked BitTorrent traffic. Comcast has stated that it does not block any websites, applications or peer-to-peer services. Other ISPs, such as Canada-based Rogers, have been observed injecting their own content into internet data, in order to modify the appearance of Google's homepage, for instance.

Donovan did, however, indicate that AT&T will begin testing usage-based pricing starting this Fall. That's driven by the economics of building network capacity, he says, not by an attempt to make more money. According to Donovan, one percent of the company's customers account for 20 percent of the network usage; the top five percent account for 40 percent of the usage. Because the network must be able to accommodate peak traffic loads, AT&T -- like other network providers -- finds itself building far more capacity than most users need, just support the most prolific users.

"It's almost a taxation issue," Donovan said, comparing the overhead required to support the top 1 percent with the annual taxes the corporation must pay. "Traffic on our backbone is growing 60 percent per year, but our revenue is not," he said.

Usage-based pricing trials will be, he says, an attempt to encourage greater efficiency in the way customers use capacity.

"I don't view any of our customers, under any circumstances, as pirates -- I view them as users," Donovan said. "A heavy user is not a bad customer." What he wants to do is gently encourage more efficient usage of his network, and usage-based pricing may be one of the ways that happens.

Such measures may not even be necessary, as Donovan admits that users self-adjust their habits to take advantage of off-peak times. For instance, he said, BitTorrent on the company's network peaks around 4 a.m., when other traffic is at an ebb. Overall P2P traffic accounts for about 20 percent of the network's usage, Donovan said.

But really, he'd rather talk about the massive increase in bandwidth that the company is planning.

On the wireless front, AT&T is currently in the midst of a 3-G upgrade, based on HSPA technology, that will take over-the-air download speeds from 1.7 Mbps now to 7 Mbps in the next phase and, finally, to 11 Mbps. (The company did not provide specifics on when these speeds would be in effect.) Starting in 2012 or 2013, the company will begin its deployment of fourth-generation "Long-Term Evolution" (LTE) technology, which promises speeds of up to 100 Mbps.

For wired internet access, Donovan boasted of a recently-upgrade backbone that's now capable of 40 Mbps, and stated that the company is in the process of deploying fiber optic networks to people's homes, starting with all new housing developments.

It's not just about fat pipes, either: AT&T also wants to bring you content and applications. Top of the list is internet video, with new interfaces that will let you watch any video content online -- not just cable TV channels -- on your television.

"We should be able to radically reshape the interface for TV," Donovan said. "The remote will be dead. The channels will be dead. If all the historical video is available online there's no reason we can't organize that for you."

Even though it aspires to become a content provider, the company is also open to allowing other companies to offer competitive content and applications over AT&T's data lines, Donovan said.

Donovan did not address questions relating to the company's alleged data connections with the National Security Administration. Wired.com reported in 2006 that the company provided NSA officials with full access to customers' phone calls and internet traffic via a secret monitoring closet, a claim that the company has not confirmed nor denied.

AT&T officials insisted that anything related to the company's involvement with the NSA was off the table, as a precondition of the meeting with Wired.com.

Also, Donovan did not offer any specifics on the company's possible plans to monitor network traffic for copyright violations, as public policy chief James Cicconi suggested it might. Donovan said such monitoring was technically possible, and could be targeted either at specific applications or at specific copyrighted content, via deep packet inspection. However, he said the company was not currently monitoring such usage on an individual customer level.

Comcast Beginning 'Net Neutrality' Testing
David Kravets

Comcast will begin testing what the cable concern has described as a "protocol agnostic" approach to managing bandwidth traffic during high-peak periods, Comcast said Tuesday.

Selected customers in Chambersburg, Pennsylvania, and Warrenton, Virginia, are expected to receive e-mails on Wednesday highlighting the program. The 30-day tests are expected to begin Thursday.

"Unless you are an extremely heavy user of internet resources (which is not likely) you will not notice any change to your internet experience during this test," Mitch Bowling, general manager of Comcast online services says in the e-mail. "At the busiest times of the day on our network (which could occur at any time), those very few disproportionately heavy users, who are doing things like conducting numerous or continuous large file transfers, may experience slightly longer response times for some online activities, until the period of network congestion ends."

The move is designed to set aside complaints that the Philadelphia-based company has been throttling BitTorrent data and other peer-to-peer traffic to manage congestion. Comcast's practices have been the subject of hearings before the Federal Communications Commission, which is set to announce new rules concerning the concept of net neutrality.

Comcast announced in March it was switching to a new network management technique by the end of the year for managing bandwidth use and congestion. The company said it was partnering with BitTorrent Inc. of San Francisco, to develop a neutral traffic-management protocol.

Given that peer-to-peer users are the biggest users of bandwidth, it remains to be seen who in practice the new tests would disrupt during congestion periods. For now, rules by the FCC give ISPs broad authority to manage traffic flows, although that might soon change.

Comcast's testing follows the announcement by rival Time Warner Cable, which is to begin tests with customers on Thursday with metered access to bandwidth under a plan in which bigger users would pay more. Comcast has also publicly endorsed a metering plan, but has not roled out one.

Comcast has come under the ire of many digital rights groups for its network management practices. And last week, hackers took out their revenge against Comcast and redirected the Comcast.net homepage for several hours. The FBI is probing the incident. No arrests have been made.

Comcast Tests a New Bandwidth Black List
Saul Hansell

Some Comcast customers who actively download software and video files may soon find one set of unexplained delays replaced with a different sort of equally cryptic slowdowns.

Comcast is starting to test new approaches to protecting its network from what it describes as congestion caused by a handful of customers who use far far more bandwidth than everyone else. Until now, Comcast has been using devices that interfered with the BitTorrent protocol—the most common method for downloading large files from computers of other users. BitTorrent is often used by people exchanging pornography and illegal copies of movies, but creators of video and software also choose to use BitTorrent as an inexpensive way to distribute their creations.

It will test new devices that will keep track of Comcast users and assemble a blacklist of heavy users. Those on the blacklist will find that all of their online activities may slow down at peak times: from downloading movies to checking e-mail.

For now, these restrictions are just as mysterious as the secret blocking of BitTorrent. Charlie Douglas, a Comcast spokesman, said the company would not disclose what sort of usage it takes to get on the black list, how long someone stays on it and if there is any way to get off. Most significantly, Comcast won’t even tell users if they are on the black list.

Comcast, which was criticized for not being forthright about its restrictions on BitTorrent, has promised to find a new approach that will block heavy users of bandwidth regardless of what content or communication protocol they are using.

It is starting three 30-day tests, each of a different sort of hardware that it might use as the traffic cop for its new restrictions. On Thursday, it will start tests in Chambersburg, Penn., and Warrenton, Va. Later in the summer it will conduct another test in Colorado Springs, Colo.

Mr. Douglas said that the test is meant to pick hardware vendor and test different configurations of rules. He points out that the vast majority of users won’t see any changes to their service at all.

“When we roll this out nationally by the end of the year, all those types of questions will be answered,” he said. “We are trying to figure out what do customers want, what techniques need to be in place to create the best user experience.”

Still, how the company can test the effect on its customers without explaining the rules to them and giving them visibility into their own usage remains to be seen. Until that happens, I suspect Comcast will stay on the black list of at least the heaviest users.

Comcast and Time Warner's New Network Management Techniques Are Neutral…For Now
Mehan Jayasuriya

When discussing Net Neutrality, a phrase that often gets bandied about is “reasonable network management”. Just what, exactly, constitutes “reasonable” network management? While ISPs like Comcast and AT&T would have you believe that packet-spoofing and content filtering are reasonable practices, we here at Public Knowledge disagree. In accordance with the core principles of Net Neutrality, we believe that a reasonable network management technology is one that does not privilege, degrade or prioritize traffic based on the content, applications or services that it is associated with. But what would such a technology look like? This week, Comcast and Time Warner both begin testing network management techniques that don’t seem to violate the aforementioned guidelines. While these technologies are a step in the right direction, they also come bundled with a unique set of challenges.

Clearly, if ten percent of Internet users suck up 80 percent of the available bandwidth on broadband networks, as has been suggested, ISPs should be allowed employ some form of network management to ensure that a few bandwidth hogs don’t ruin the Internet for the rest of us. But how can a provider discourage users from overindulging in high-bandwidth activities without targeting specific applications? Time Warner thinks it has the answer: by doling out a monthly allotment of bandwidth to each user. In the company’s new pilot program, users who stay under their limit will pay the same set fee every month. Users who exceed their limit, however, will be charged for the additional bandwidth used—just like with a monthly allotment of mobile phone minutes.

Starting today, Time Warner subscribers in Beaumont, Texas will be able to choose from a number of different Internet service packages, ranging from a 768Kbps connection with a 5GB cap ($29.95 per month) up to a 15MBps connection with a 40GB cap ($54.90 per month). Any additional bandwidth used (either upstream or downstream) will be billed to the user at a rate of $1 per Gigabyte.

On the surface, these limitations seem somewhat reasonable. However, when you consider that Sprint lets users eat up to 5GB/month on its wireless data network, that 5GB doesn’t seem quite as generous for a wireline connection. And even the “high end” 40GB data cap could prove inadequate. As Ars Technica duly notes, “The Internet is increasingly being used as a vector for distributing software and digital video content and also facilitates multiplayer gaming, video conferencing, real-time collaboration, interactive remote desktop access, file backups, and many other bandwidth intensive activities.” Despite what you think, that 5GB might disappear fast—especially if you have video game consoles, video streaming appliances and online backup services hooked up to your network—as an increasing number of us do.

So, might there be another way to regulate traffic by punishing only the heaviest users while leaving the rest of us to stream video in peace? Comcast seems to think so. In the wake of the controversy caused by the company’s Bit Torrent blockade, Comcast has begun testing a new method of network management that identifies which users are eating up the most bandwidth and temporarily imposes limits on those users during times of network strain. According to a FAQ published by Comcast, “the technique measures only aggregate bandwidth consumption, not the protocol or content being used by customers.” During times of network congestion, the technology “manages [the bandwidth usage of users] until their usage falls below established bandwidth usage thresholds or until network congestion ends.”

In theory, this method sounds a whole lot better than the techniques that are currently being employed by Comcast. However, given the fact that the company previously promised that it only managed traffic during times of congestion, only to have those claims disproved, we might have to take the term “network congestion” with a grain of salt. Also unsettling is the fact that the company hasn’t revealed any further details about what constitutes a high-bandwidth user and how limited those users will be during times of congestion. If Comcast chooses to roll out this type of technology, it will have to be upfront with its customers about what the exact limitations are. And given the company’s secrecy throughout the Bit Torrent fiasco, I wouldn’t hold my breath for that kind of transparency.

So, we’ve established that while technically “neutral,” both Time Warner and Comcast’s new network management techniques are not without their share of issues. There is still, however, one very large elephant left in the room: the fact that both Comcast and Time Warner are cable television providers. And as we all know, despite the industry’s constant invocation of the P2P bogeyman, at present, the largest bandwidth hog is actually streaming video. Clearly, the emergence of online video is something that cable video providers find very threatening and by capping off bandwidth usage, they’re effectively killing two birds with one stone; discouraging users from using their Internet connections for video while increasing the efficiency of the network. Is this anti-competitive? It sure seems like it. But is it anti-neutral? Technically, no. While Time Warner and Comcast both deliver video and Internet service via the same pipe, the two services live on separate networks.

Even that could change, however, depending on how well the cable industry responds to the coming threat of IPTV. While unlikely, it’s possible that both Time Warner and Comcast will branch out into video over IP in the coming years, if such a move is dictated by market pressures. And then what? Will Time Warner count videos streamed using its service when calculating your monthly bandwidth usage? Will Comcast penalize you for purchasing its video content online? If the answer to these questions is ‘no,’ then the two companies will be prioritizing their own video content over video content from other providers on the same network. In which case, we’ll find ourselves back at square one.

Submitted by barry payne-eco... on June 5, 2008 - 7:27pm.


Bandwidth capacity is a measure of momentary (instant) flow use of Gigabits and should not be confused with Gegabyte use over time. Reducing congestion in peak periods is about reducing coincident Gigabit use which may come from large or small Gegabyte users who contribute to congestion on the same per Megabit basis, regardless of their total Gegabyte use over time.

If Comcast restricts only “heavy Gegabyte users” in peak congested periods, then small peak users are getting subsidized by “heavy users” on a per Megabit basis because both are causing the same amount of congestion on that basis.

If Comcast insists on centralized non-price rationing methods to reduce peak congestion for the artificial shortages it has created, at least bandwidth should be reduced for all peak users on some proportionate basis - most likely in proportion to their maximum connection rating. Otherwise, it’s not neutral management of congestion in terms of reduced use based on causality - in conflict with its newly claimed “agnostic protocol management”.

Otherwise, the term “bandwidth hog” is a misnomer, arising both from propaganda to undermine net neutrality as well as the practice of overselling bandwidth in terms of the Gegabytes produced by a connection, then declaring large users as over the line - while simultaneously refusing to draw lines - until now with metered Gegabytes, which is a crude method of rationing bandwidth since off-peak use does not affect congestion.

By continuing to cherry pick away at “heavy users”, the network providers put their market power and strategic pricing control front and center with selective congestion controls and absurd low limits on Gegabyte use with sharp overage penalities. Any competitive market would have a full range of available Gegabytes and bandwidth tiers in Megabits along with multiple levels of service quality and peak/off-peak pricing plans.

Meanwhile, the term “bandwidth hog” should to be challenged everywhere it appears - it represents the essential justification for establishing fast lanes for selective, high-price content versus everything else that gets dumped into the slower bus lanes, the whole grand design touted to “alleviate congestion from the coming exaflood”. What it really means is higher prices will be assessed to escape the artificial shortage, existing service will be degraded and much produced content will be denied access to the fast lane.

There are no “bandwidth hogs” - there are users of different amounts of available maximum Megabits in designated bandwidth tiers, and when they use (acquire) more bandwidth, they pay more and vice versa as explicitly provisioned in the business model of network providers.

Because network providers were caught flatfooted by the increased use of Megabits per connection that they explicity marketed and sold, is not a reason to blame the outcome on “hog” customers, particularly given the intentional underinvestment - it was easy enough to downgrade the connection capacity instead, to be consistent with an uncongested network, but they refused and kept overselling it.

Now that they’ve created the perfect storm of a congestion problem that must be solved by means other than investment or appropriate pricing, the only thing standing in the way of course, is … net neutrality.

Teens Await Arrest after Comcast Attack
Elinor Mills

Updated at 12:15 p.m. PDT to clarify that Comcast wasn't technically hacked, but that its domain and Web site were hijacked.

Two teenagers who say they hijacked Comcast's Web portal on Thursday also say they expect to be arrested for their actions.

"I wish I was a minor right now because this is going to be really bad," 19-year-old "Defiant" told Wired's Kevin Poulsen, who managed to get a one-hour phone interview with Defiant and his 18-year-old cohort "EBK."

"I slept in my clothes, because the last time they came, I was in my underwear with my dong hanging out and shit," Defiant said of a past raid.

On Thursday, Comcast's portal was defaced, leaving some e-mail subscribers without service. On the site, the hackers referenced their group: "KRYOGENICS Defiant and EBK RoXed Comcast."

The teens say that after they initially managed to take control of Comcast's registrar account at Network Solutions, they called the company's technical contact to tell him, but he dismissed their claim and hung up on them.

That response angered EBK, who says he then decided to redirect traffic from Comcast's site to other servers. "I wasn't even really thinking," he said. "Plus, I'm just so mad at Comcast. I'm tired of their shitty service."

Meanwhile, the teens say they did not grab user names and passwords during the hack, even though they could have.

Comcast Hijackers Say They Warned the Company First
Kevin Poulsen

The computer attackers who took down Comcast's homepage and webmail service for more than five hours Thursday say they didn't know what they were getting themselves into.

In an hour-long telephone conference call with Threat Level, the hackers known as "Defiant" and "EBK" expressed astonishment over the attention their DNS hijacking has garnered. In the call, the pair bounded freely between jubilant excitement over the impact of their attack, and fatalism that they would soon be arrested for it.

"The situation has kind of blown up here, a lot bigger than I thought it would," says Defiant, a 19-year-old man whose first name is James. "I wish I was a minor right now because this is going to be really bad."

The two hackers are members of the underground group Kryogeniks. The interview was arranged by Mike "Virus" Nieves, an 18-year-old New Yorker who pleaded guilty as a minor last year to hacking AOL. Neives, who was on the call, is also a member of Kryogeniks, though he and his compatriots say he's stopped hacking.

Nieves vouched for the identities of the hackers. Threat Level also confirmed Defiant's identity over AOL instant messenger, on a handle that's known to belong to Defiant.

Neither hacker would identify their full names or locations. Defiant's MySpace profile lists him in Cashville, Tennessee, but he says that's incorrect. His girlfriend lists herself in New York. Threat Level expects both hackers' names and locations will emerge soon.

The hackers say the attack began Tuesday, when the pair used a combination of social engineering and a technical hack to get into Comcast's domain management console at Network Solutions. They declined to detail their technique, but said it relied on a flaw at the Virginia-based domain registrar.

Network Solutions spokeswoman Susan Wade disputes the hackers' account. "We now know that it was nothing on our end," she says. "There was no breach in our system or social engineering situation on our end."

However they got in, the intrusion gave the pair control of over 200 domain names owned by Comcast. They changed the contact information for one of them, Comcast.net, to Defiant's e-mail address; for the street address, they used the "Dildo Room" at "69 Dick Tard Lane."

Comcast, they said, noticed the administrative transfer and wrested back control, forcing the hackers to repeat the exploit to regain ownership of the domain. Then, they say, they contacted Comcast's original technical contact at his home number to tell him what they'd done.

When the Comcast manager scoffed at their claim and hung up on them, 18-year-old EBK decided to take the more drastic measure of redirecting the site's traffic to servers under their control. (Comcast would neither confirm nor deny the warning phone call.)

"If he wasn't such a prick, he could have avoided all of that," says EBK. "I wasn't even really thinking. Plus, I'm just so mad at Comcast. I'm tired of their shitty service."

"They called me back five minutes later and said, 'We got Comcast'," recalls Nieves.

The defacement message was short and simple: "KRYOGENICS Defiant and EBK RoXed Comcast," it read. "sHouTz to VIRUS Warlock elul21 coll1er seven."

Comcast boasts 14 million subscribers nationwide, and handling the massive traffic aimed at Comcast.net was no easy task. The hackers stayed up most of the night opening new webhosting accounts, and constantly moving the DNS to follow them. In all, they claim, they burned through 50 different hosts to keep their defacement alive. "You know how hard it is to find hosting handling that kind of traffic?" says EBK "The first one went in two minutes."

The attack began at around 11:00 p.m. Eastern time, and the hackers owned Comcast.net until 4 or 5 a.m. Even when Comcast regained control, it took hours longer for the change to fully propagate through the DNS, leaving some customers without webmail access as late as 11:30 Thursday morning.

EBK slept for an hour Wednesday night; Defiant for 20 minutes. Even as the attack was in progress, the hackers began to feel the weight of their actions. Both say they've been raided by law enforcement before. "I slept in my clothes, because the last time they came, I was in my underwear with my dong hanging out and shit," says Defiant.

"I feel like he did it for the publicity," says Luis "Auto" Alicea, a former member of Kryogeniks, who runs a website hosting screenshots of hacks in progress. "The fame."

Defiant began hacking about three years ago, when he was kicked out of high school for possession of narcotics at the age of 16. "I wound up assaulting the school resource office," he says. He entered a home schooling program, but didn't take to it, and gravitated to the internet. There he "bumped into the wrong people."

EBK, too, says he dropped out of high school.

Thursday, the pair were dealing with their newfound fame, laughing over the press coverage with a mix of glee and nervous excitement. Some reports have speculated that the hackers were retaliating for Comcast's recent sabotage of BitTorrent traffic; Defiant and EBK say that's false: they just hate Comcast in general. "I'm sure they hate us too," says Defiant.

"Comcast is just a huge corporation, and we wanted to take them out, and we did," he says.

Fellow hackers, relying on press reports claiming that customer data may have been compromised, are hitting up the duo for passwords to Comcast e-mail accounts, which they say they don't have. "Nobody was listening in on the ports to try and get usernames and password," says Defiant. "We could have, but we didn't." (On this point, Comcast and the hackers agree).

The hackers say the flaw they exploited still exists, and that other large websites are equally vulnerable. Asked if they plan to attack anyone else, EBK says, "Who knows. Only Kryogeniks knows"

The elder hacker in the team says he was reluctant to use his access to take over Comcast.net, and emphasizes that the pair tried to warn Comcast about the flaw.

"I was trying to say we shouldn't do this the whole damn time," says Defiant.

"But once we were in," adds EBK, "it was, like, fuck it."

(David Kravets contributed to this report)

Congress Urged to Investigate ISPs Over User Tracking
John Timmer

Last month, we reported that Charter Communications, a major ISP and cable provider, was testing a system that tracked the surfing habits of its subscribers, with the goal of sending them targeted ads. Charter made the system opt-out, meaning that users had to both be aware of it happening, and then find a form on Charter's web site to avoid being profiled. That opt-out feature immediately attracted the attention of Congress, and a coalition of privacy groups are now calling for a full investigation.

Charter's program appears to involve deep packet inspection (DPI), in which hardware scans the actual content of traffic flowing across the ISP's network. In this case, users at a given IP address would have a profile assigned to them based not only on the sites they visited, but also the content of the pages viewed at that site. That profile would be fed to ad agency NebuAd, which would use it to feed its partners ads that it predicts a given individual would be interested in viewing.

The privacy implications here are pretty obvious, and the news of Charter's program spurred a rapid Congressional response. Less than a week after the news broke, the ranking members of the House Telecommunications Subcommittee, Edward Markey (D-MA) and Joe Barton (R-TX), sent a letter (PDF) to Charter's president, asking that the program be stopped until Congress had the opportunity to evaluate it. The letter cites Section 631 of the Communications Act, which requires that any program of this nature requires "prior written or electronic assent of the subscriber."

Clearly, an opt-out service doesn't fit meet this standard. As Markey stated, "Simply providing a method for users to opt-out of the program is not the same has asking users to affirmatively agree to participate in the program."

A coalition of privacy groups has now published an open letter (PDF) to Markey and Barton, voicing its support for their efforts. The 15-member coalition includes the Center for Digital Democracy, Electronic Frontier Foundation, Free Press, and Public Knowledge. Its letter recognizes that reports have surfaced of other ISPs using similar technology, and suggests a wider inquiry is in order. "We are concerned that such ISP wiretapping schemes may violate multiple privacy laws and policies," it reads. "These practices should clearly be investigated."

The letter stresses the urgency of the situation. Terming it a "major new privacy threat," Jeff Chester of the Center for Digital Democracy said in a statement that, "Congress must swiftly act to protect the public." Ari Schwartz from the Center for Democracy & Technology noted, "Congress needs to weigh in now before the practice becomes standard operating procedure for the ISPs."

Beyond the privacy implications, the experience of British Telecom with a similar form of snooping suggests that basic incompetence of the ad agency can have a negative impact on users. Wired found an internal British Telecom document (PDF) on Wikileaks that describes that company's experiment with a JavaScript-based tracking technology. Apparently, the injected code caused strange browser behavior, and snippets of code would sporadically appear in text areas of web forms. This caused some users to suspect their machines had a malware infection, a fear that undoubtedly cost them time and money.

Even when working properly, these programs appear to be illegal if Markey and Barton's analysis is correct. Given that the user snooping program is already in progress, quick Congressional action appears to be essential.
The full list of organizations signing the letter:

Center for Democracy and Technology, Center for Digital Democracy, Consumer Action, Consumer Federation of America, Consumers Union, Electronic Frontier Foundation, Electronic Privacy Information Center, Free Press, Media Access Project, Privacy Activism, Privacy Rights Clearinghouse, Public Knowledge, US Public Interest Research Group, World Privacy Forum, Canadian Internet Policy and Public Interest Clinic

Pirates Slowly Killing MediaDefender

It has been a rough year for MediaDefender and their parent company ArtistDirect. Last September a database of internal emails leaked, and last week they received more bad press for DDoSsing Revision3. Unsurprisingly, MediaDefender’s revenue has dropped significantly as a result.

This is not the first time we have reported on MediaDefender’s poor financial situation, now it’s looking like the company has lost the last bit of goodwill they had left.

Surprisingly, however, MediaDefender - best known for spreading fake files on BitTorrent - does not blame itself for their losses, but the music labels. In their latest quarterly report the company explains the huge drop in revenue as follows:

“Revenues related to MediaDefender’s anti-piracy activities declined in 2007 as compared to 2006 and management anticipates a further decline in 2008. The largest source of this decline is due to reduced spending on the part of the major music labels due to a significant reduction in their sales and profitability.”

So, MediaDefender argues that the music labels are spending less money because their revenue is going down. This is a strange argument, if you consider that the music labels blame piracy for the decrease in sales. MediaDefender’s purpose is to decrease piracy, so either they are not doing their job very well, or there might be another explanation that the labels stopped hiring MediaDefender.

Could it be that the bad press that resulted from the security breach at MediaDefender has something to do with it? Some of the emails that leaked at the time revealed some unique insight into the inner workings of these labels and i’m sure they weren’t too happy about that.

In the quarterly report last year’s email leaks aren’t mentioned at all, even though it could very well be one of the major causes of the decreased revenue. By November 2007 MediaDefender had already lost a massive $825,000 due to the leaks, and more financial damage was to be expected.

Before the email leak, stock was around the $2.25 mark, but this has dropped to less than $0.50. Last week we learned that MediaDefender is not only going after trackers from BitTorrent search engines, but that they’re also targeting businesses like Revision3. This wont do their image any good either, and might bring the company down even further.

So, what will happen now? Revision3’s CEO Jim Louderback said on Twit that they wont pursue the company in court after all. Nevertheless, I’m quite convinced that the company has the ability to walk the plank to bankruptcy, all by itself.

MediaDefender Defends Revision3 SYN Attack
David Kravets

When MediaDefender rained down an attack of some 8,000 SYN packets a second on an open BitTorrent tracker that pointed the way to hundreds of thousands of copyrighted movies for the taking, it had no idea it was shuttering a legitimate San Francisco media company.

Revision3, the San Francisco-based site the produces and distributes the popular DiggNation show and others via the BitTorrent protocol, went offline over the Memorial Day weekend after its servers buckled under the attack. Revision3's distribution tracker was open, and was pointing the way for pirates to download copyrighted movies unbeknownst to Revision3.

MediaDefender is paid by the recording and motion picture industries to seed fake files to illicit torrent tracking services. When Revision3 closed the tracker during the holiday weekend, the result was a denial of service attack by MediaDefender, which had been seeding the tracker with fake torrents.

"Our systems were targeting a tracker not even knowing it was Revision3's tracker," Randy Saaf, Media Defender's CEO, said in an interview. "They were using the tracker as the tracker for their legitimate content. It had been open for years."

At Fenopy.com, Revision3's tracker was used for 296,000 downloads, mostly of unauthorized copyrighted movies, Saaf said.

Jim Louderback, Revision3's CEO, said the attack shut down the company's internet site, RSS server and internal corporate e-mail.

It's an open debate whether MediaDefender's actions were lawful, even when it targets illicit torrent-tracking sites pointing the way to unauthorized, copyrighted material. The FBI is examining the Revision3 affair.

One bureau source told THREAT LEVEL that it was a "gray" area in federal computer security law.

Then there's the area of corporate responsibility. Louderback said in an interview that Revision3 closed the hole in its tracker over the Memorial Day weekend and subsequently got slammed by MediaDefender.

"That's when MediaDefender went into overdrive and started pummeling us," Louderback said. "If a tracker was previously open and suddenly shut, their systems are automatically configured to put them out of business."

Saaf said MediaDefender had been seeding the tracker with fake torrents for some time. Fake files corrupt BitTorrent downloads.

"We saw an open BitTorrent tracker with a lot of pirated content on it. We had been posting fake files to their tracker. Over Memorial Day weekend, Revision3 changed some configurations," Saaf said.

MediaDefender, of Santa Monica, Calif., holds some 2,000 servers with a 9GBps dedicated connection.

Louderback said if MediaDefender was "concerned that we were tracking copyrighted material, they should have called us."

He wondered aloud over what tragedy may have happened had Revision3 "been an airport using BitTorrent to distribute approaches to the runaway?"

The Pirate Bay: Two Years After the Raid

Today, exactly two years have passed since The Pirate Bay was raided by the Swedish police. Unlike Hollywood would have wanted, the worlds largest BitTorrent tracker now more popular than ever, and they are here to stay.

The raid on the Pirate Bay took down the site, but not for long. Within three days the site was back online, and much to the dislike of anti-piracy outfits, its traffic had doubled thanks to all the media attention.

At the time, the Swedish police confiscated 180 servers, most of which had nothing to do with The Pirate Bay. Last December the investigation finally came to an end, resulting in 4,000 pages of legal paperwork. Prosecutor Hĺkan Roswall later announced that four individuals involved with The Pirate Bay are being charged with “assisting copyright infringement” of 4 software applications, 9 films and 22 music tracks.

After the raid, it became clear that the US had threatened to put Sweden on WTO’s black list if they refused to deal with the Pirate Bay problem. Even the MPAA was involved, as John Malcolm, Executive Vice President of the MPAA wrote a letter to Sweden’s State Secretary in which he stated, “It is certainly not in Sweden’s best interests to earn a reputation among other nations and trading partners as a place where utter lawlessness with respect to intellectual property rights is tolerated.”

The users of the site don’t have to worry that the site will be taken offline though, no matter what the court decides. “In case we lose the pending trial (yeah right) there will still not be any changes to the site. The Pirate Bay will keep operating just as always. We’ve been here for years and we will be here many more,” Sunde said earlier.

In a blog post, The Pirate Bay team now suggests to make May 31st a day of celebration for pirates: “Let today be the pirates independence day! Today we celebrate the victories we’ve had and the victories that will come. Today we celebrate that we’re united in our efforts. Keep on seeding!”

Happy Pirates independence day!

Will BitTorrent Sites Become Obsolete?

Researchers from several Universities are currently working on a search technology that could make BitTorrent sites obsolete. While the idea of a completely decentralized filesharing network is not new, there are some downsides that are often overlooked.

BitTorrent may be decentralized, but a large part of the BitTorrent community still relies on centralized websites and trackers. These trackers and torrent sites are considered to be the Achilles heel of the BitTorrent hydra.

At the moment, the top three BitTorrent sites host are handling the majority of all BitTorrent users, and even worse, The Pirate Bay tracks well over 50% of all public torrent files. BitTorrent has welcomed many new users over the past three years, and we are now in the uncomfortable situation where the downtime of one of the larger sites may cause problem for the others, simply because they can’t handle the traffic.

This is exactly what happened last month when Mininova was offline for a day due to a hardware problem. Mininova has well over three million visitors a day, these people went to other sites while Mininova was down, and this increase in traffic got some sites in serious trouble. The question is: Is there an alternative?

The answer to this question is yes and no. A solution to the tracker problem that works pretty well is DHT, or “trackerless torrents”. With DHT you can still connect to other people who are downloading the same file, even when the tracker for that torent is not working properly. Thanks to DHT, people were able to download torrents that were tracked by Demonoid.com, up to six months after the tracker went down. The downside of DHT (the mainline version) is that not all clients support it, and that it is maintained by one company, BitTorrent Inc.

Replacing BitTorrent sites is even more complex. How do you find torrents when there are no BitTorrent search engines that store them? A possible solution to this problem comes from researchers of Cornell University, who developed an Azureus plugin named Cubit. The Cubit plugin allows you to find torrents, and doesn’t require a centralized server as BitTorrent sites do. You basically search for torrent files among other peers, similar to Kazaa and Limewire. An interesting concept, but unfortunately, this also has a lot of downsides.

Cubit opens the gates for floods of spam, because it misses one key feature: moderation. Since BitTorrent has become so popular, anti-piracy organizations like MediaDefender and BayTSP are constantly uploading fake files, and scammers are uploading malware and spyware, often wrapped in fake media players.

To most people is goes unnoticed, but sites like Mininova and The Pirate Bay have a dedicated team of moderators that remove hundreds of fake and scammy torrents a day. Together these moderators remove more than a thousand torrents per site, day in and day out. In addition, most BitTorrent sites also use IP-filters to prevent known scammers and anti-piracy outfits from uploading their content again.

So, for now, Cubit is not yet going to replace BitTorrent sites, as they need to address the lack of moderation first. Tribler, another application that is developing a BitTorrent site replacement that seems to be far ahead of Cubit, already implemented such moderation features and spam filtering. Branded as the “social” BitTorrent client, is also has community features that many people appreciate.

In sum, I think it is safe to conclude that BitTorrent as it is has some weak spots that could cause problems in the future. The Pirate Bay, Mininova and isoHunt - the top three BitTorrent sites - are all involved in a court case. Depending on the outcome of these cases, the need for alternative search technologies may become more apparent. For now, however, we need BitTorrent sites, and in particular their moderators.

Radiohead to Prince: Unblock 'Creep' Cover Videos
Jake Coyle

After word spread that Prince covered Radiohead's "Creep" at Coachella, the tens of thousands who couldn't be there ran to YouTube for a peek. Everyone was quickly denied — even Radiohead.

All videos of Prince's unique rendition of Radiohead's early hit were quickly taken down, leaving only a message that his label, NPG Records, had removed the clips, claiming a copyright violation. But the posted videos were shot by fans and, obviously, the song isn't Prince's.

In a recent interview, Thom Yorke said he heard about Prince's performance from a text message and thought it was "hilarious." Yorke laughed when his bandmate, guitarist Ed O'Brien, said the blocking had prevented him from seeing Prince's version of their song.

"Really? He's blocked it?" asked Yorke, who figured it was their song to block or not. "Surely we should block it. Hang on a moment."

Yorke added: "Well, tell him to unblock it. It's our ... song."

YouTube prohibits the posting of copyrighted material. If the site receives a complaint from a copyright owner, it will in most cases remove the video(s). Whether the same could be done for a company not holding a copyright is less clear, but Yorke's argument would seem to bear some credence according to YouTube's policies. YouTube, which is owned by Google, declined to comment.

Prince also did not immediately respond to a request for comment Thursday.

The dispute was an interesting twist in debates over digital ownership, held between two major acts with differing views on music and the Internet. Radiohead famously released their most recent album, "In Rainbows," as a digital download with optional pricing. They also have a channel on YouTube.

When Prince performed at the Coachella Valley Music and Arts Festival in Indio, Calif., on April 26, he prohibited the standard arrangement of allowing photographers to shoot near the stage during the first three songs of his set. Instead, he had a camera crew filming his performance.

Prince, who founded NPG Records in 1993, has been innovative when it comes to music distribution, too. He released his 1997 album, "Crystal Ball," on the Internet and in 2006 was awarded a lifetime achievement award by the Webbys. In 2007, he gave away copies of his disc "Planet Earth" in a British Sunday newspaper.

But the Purple One has also shut down his official Web site and in September of last year said he would sue YouTube and eBay for not filtering unauthorized content.

Prince fans have organized to urge him to relent in his legal fights to control images and photographs of himself. As of Thursday, the most popular YouTube clip about Prince playing "Creep" is an expletive-laden rant from Sam Conti Jr., who describes himself as a "former Prince fan."

Facebook Settlement of Code-Theft Suit May Fold

Connectu claims it has unearthed 'smoking-gun' computer evidence
Erik Larson and Janelle Lawrence

Facebook, owner of the social-networking Web site valued last year at $15 billion, is struggling to enforce a settlement of a copyright lawsuit accusing founder Mark Zuckerberg of stealing computer code.

Founders of ConnectU in February settled claims that Zuckerberg took their business idea in 2003 while they were students at Harvard University. ConnectU's lawyers said yesterday that the company wants out of the deal, citing what they called new "smoking-gun" evidence allegedly found by a forensic expert on Facebook's computers.

"If we are forced into a settlement, the next step is going to be a fraud claim," ConnectU's attorney, John Hornick, told U.S. District Judge Douglas Woodlock at a hearing Tuesday in Boston. ConnectU said the new evidence stems from electronic instant messages found on Facebook's computers.

Closely held Facebook, the world's second-biggest social-networking site, is seeking to enforce the settlement as it expands its reach and challenges News Corp.'s MySpace, the industry leader.

Woodlock declined to elaborate on the new evidence, criticizing Cambridge, Mass.-based ConnectU for signing a settlement before all documents in the case had been turned over. The judge compared the situation to "buyer's remorse."

"The parties chose to do what they did based on imperfect knowledge of what the outcome of the case might be," Woodlock said. "You knew at the time you entered into the agreement it wasn't complete."

The settlement must ultimately be approved by U.S. District Judge James Ware in San Jose, where a related case between the companies is pending. Ware has scheduled a June 23 hearing on the accord.

ConnectU's founders, brothers Cameron and Tyler Winklevoss, originally hired Zuckerberg to help build a dating Web site for Harvard students. They now accuse him of delaying the ConnectU project while secretly building Facebook. The claims include copyright infringement and theft of trade secrets.

The instant messages were discovered by forensic expert Jeff Parmet, hired by ConnectU to scan Facebook's hard drives following a September court order for new discovery, ConnectU's lawyers said. Parmet was prohibited from discussing with ConnectU anything he found that wasn't computer code.

"Parmet had, nevertheless, obliquely given ConnectU's attorneys reason to believe that there were documents, other than produced program code, on the Facebook hard drives relevant to the case which had not been disclosed," Woodlock said in an order Tuesday.

Facebook spokeswoman Erin Zeitler and Hornick didn't immediately return calls seeking comment.

Facebook, the Princess Phone and a Mattress for Sergey and Eric
John C Abell

Facebook CEO Mark Zuckerberg and Sheryl Sandberg presented interviewer Kara Swisher with a pink phone before they sat down for the interview at the All Things Digital conference.

"We learned this morning from Barry Diller that we are the Princess Phone of our generation," says Sheryl Sandberg, the COO of Facebook. "We didn't know what that was so we went out and bought one."

The 5-year-old company, valued at more than $15 billion, is all about connecting people. Its open development platform makes the program even more appealing to its more than 70 million users.

Zuckerberg said he started to think about his own site as he hacked AOL while he was in high school. He launched the site during a summer off from Harvard and didn't go back. Zuckerberg likes to use the expression that people are sharing themselves on his site.

Zuckerberg says he's met with Sergey Brin and Eric Schmidt from Google. "They came over to my apartment and I think there was just a mattress on the floor," he said -- a memory confirmed by Sandberg, a former Google officer.

He admires Google, but says he plans to keep his own business.

Facebook is growing and the end goal isn't selling the company and bailing, they said. "We're no where near the end of this trend," Zuckerberg says. "We're only four years in so there's a lot left for us to go."

They spend a lot of time watching how people use the site, the two say.

"All conversations come down to the user." Sandberg says. "Everything should come back to what the user wants."

What does the user want? Not Beacon, Zuckerberg says. He called the data-mining program launched in November a failure in the bluntest possible way.

What would he like to see built on those platforms?

"Something for sports would be really interesting, maybe something more for politics, maybe something more for religion," Zuckerberg.

What they've seen is that people aren't looking so much for another Office program. They want to "share themselves" in bursts.

"The trend is towards much smaller, more frequent updates," Zuckerberg says. The future seems to be about tweaking.

"If you look at the original platform, it was very focused on building these boxes for the profiles," Zuckerberg says. "We want to make sure the developers are incentivized to build applications that are engaging to users and trustworthy to users."

Apps that are more engaging will get more play, he says.

"You give people control and they'll share more of themselves, they'll share more info about themselves."

College Alumni Magazines Struggle to Compete With Facebook
Cate Doty

Most people read their college alumni magazines for the class notes, immediately flipping to the back to see who was married, had a baby or was promoted to an envy-inducing job. The columns tend to be meatiest at this time of year — class reunion season.

The advent of social networking on the Internet has created a quandary for these magazines, which want to maintain a conversation with alumni but have been slow to embrace the Web. Most schools have set up password-protected sites where graduates can change their contact information, drop a class note or donate money.

But younger alumni, accustomed to second-by-second updates from friends and classmates, are exchanging information in real time on Facebook and MySpace. Why wait for your alma mater to churn out a quarterly journal when you can Twitter all day?

“Certainly as people do more Facebook-ing and MySpace-ing, how they do these things changes and evolves,” said John Rosenberg, editor of Harvard Magazine.

Harvard’s alumni notes are all online and password-protected because of privacy concerns, Mr. Rosenberg said. While some notes do appear in the magazine, they run alongside ads that direct readers to the Web site.

“Until a few years ago, the more electronic stuff there was, the more print we had,” Mr. Rosenberg said. “We’ve had steady growth in class notes pages, but that’s probably leveled off some now.”

While Harvard has taken a hybrid approach, universities like the University of California, Los Angeles, have rid themselves of their printed class notes to save space for other content. Stanford has adopted a zoning system, so that each graduate gets a magazine with class-specific notes.

"There is definitely a different audience online, and it’s younger," said Jack Feuer, the editorial director of U.C.L.A. Magazine. The class notes went online in 2006, and the response from readers has been largely positive, he said.

The online version of Colgate’s alumni magazine is a blog, so people can leave comments about articles and one another, said Charlie Melichar, a spokesman for the university. “Alumni overwhelmingly are the ones making comments on stories, about faculty, to congratulate a team on victory,” he said. “Alumni are certainly not just heavy users — they’re heavy engagers.”

Alumni magazines serve many purposes. They highlight the news and research at their institutions, and serve as prettied-up fund-raising vehicles. But their main appeal — as dormitory common rooms for grown-ups — has increasingly been usurped by Facebook and similar Web sites.

“Over all, universities have been reluctant to embrace social media as a communications channel because they fear a lack of control,” said Sam Huleatt, a Johns Hopkins alumnus. “Most schools now understand that they must establish some presence if they wish to remain relevant in the lives of their graduates.”

Johns Hopkins recently adopted InCircle, a Facebook-like application only open to students and alumni, Mr. Huleatt said.

The details that people include in class notes has evolved over the years, perhaps reflecting a younger generation’s tendency to share more. While some alumni magazines cling to the milestones of marriages, moves, births and deaths, others let people vent about personal issues, often in a way that is well-suited to online conversations.

“They’re talking about everything from their latest career move and how they’re managing it, to raising children with disabilities, taking care of elderly parents,” said John MacMillan, editor of the Smith Alumnae Quarterly.

The management of class notes is an important issue, since fund-raising efforts hinge on making graduates feel connected to their schools.

“While the affinity to the university certainly helps, you can’t just expect that to carry the day,” said Robert Viccellio, the editor of the University of Virginia magazine, which has a circulation of 210,000 and a budget of $1.5 million that is mostly provided by the alumni association. Last year, the magazine introduced a channel on YouTube with Web-only videos that attempt to evoke the spirit of the campus.

Most alumni publications depend at least in part on advertising. For instance, a third of the $1.1 million budget for California, the magazine for the University of California, Berkeley, comes from advertising, said Kerry Tremain, the magazine’s editor.

“Alumni magazines have been for quite a long time one of the more undervalued properties in terms of advertising,” Mr. Tremain said. “They’ve been sort of ghettoized as a kind of organizational newsletter, and not taken seriously.”

One challenge for these magazines is to foster online what readers look for in print — nostalgia for a specific atmosphere.

“What turns someone on at Cornell would leave someone at Dartmouth completely slack-jawed,” said Mr. Rosenberg of Harvard Magazine.

Disney and Pixar: The Power of the Prenup
Brooks Barnes

IN April, the Walt Disney Company summoned movie theater executives for a rare audience before its reigning king of animation, John Lasseter. A co-founder of Pixar and director of “Toy Story,” Mr. Lasseter was unveiling the roster of films that an aligned Pixar and Walt Disney Animation Studios planned to release over the next four years.

Walking onstage wearing one of his trademark Hawaiian shirts — this one with yellow and green palm trees — Mr. Lasseter was greeted by giggles and pointing from a smattering of audience members.

“What did you think I’d wear?” he asked amid the titters. A business suit and a pair of mouse ears, most likely.

When Disney bought its rival, Pixar, in 2006 for $7.4 billion, many people assumed the deal would play out like most big media takeovers: abysmally. The worries were twofold: that either Disney would trample Pixar’s esprit de corps (turning Mr. Lasseter into a drone, chanting “Hi Ho” en route to Mickey’s animation mines) or that Pixar animators would act like spoiled brats and rebuke their new owner.

Both companies had a history of acrimony, and Robert A. Iger, the new chief executive of Disney, was a mystery. Could he manage the megawatt personalities Pixar would bring into Disney’s fold? Some analysts, investors and media pundits also questioned the hefty price Disney paid for a small studio that released only one movie a year.

But two years into the integration of Pixar — and as the company rolls out “Wall-E,” a risky love story about robots that is estimated to cost at least $180 million — the merger is notable for how well it’s faring. Indeed, in an industry where corporate marriages often create internal warfare (Paramount and DreamWorks SKG are the most prominent example) Disney and Pixar have found a way to make it work.

“Most acquisitions, particularly in media, are value-destroying as opposed to value-creating, and that certainly has not turned out to be the case here,” said David A. Price, author of a newly published book from Knopf, “The Pixar Touch: The Making of a Company.”

The smooth ride — so far, at least — also seems to be pleasing Wall Street, where grumbling about Pixar’s price tag has died down. Disney’s stock has climbed 28 percent since its 52-week low on Jan. 22, in large part because of investor confidence that the company can overcome a difficult economy by leveraging Pixar’s computer-generated characters across its vast empire. In recent months, Disney’s shares have significantly outperformed those of most of its competitors.

“Cars” tells the story. The film was regarded by some critics as one of Pixar’s weaker storytelling efforts, and it generated soft foreign sales when compared with hits like “Finding Nemo.” But “Cars” has pumped billions in profit into Disney via a wide range of ancillary businesses.

The film racked up over $460 million in global ticket sales and has sold 27 million DVDs. Related retail products have generated $5 billion in sales. A “Cars” virtual world is opening on the Internet, a “Cars” ice-skating show will begin touring the nation in September, and work is under way to bring an entire “Cars” experience to the Disneyland Resort in California.

“You can accomplish a lot more as one company than you can as part of a joint venture,” Mr. Iger said in an interview. “It makes a big difference when everyone is working for the same set of shareholders.”

IN a subtle but important shift, Pixar has matured, allowing its strategic thinking to evolve inside a sprawling corporation. For instance, some of the studio’s executives once resisted sequels and direct-to-DVD efforts, arguing that quality and the brand could suffer. While sequels were not out of the question, they said Pixar’s hot streak hinged on pushing boundaries with original material.

But at Mr. Lasseter’s presentation in April, Disney’s first such event in 10 years, he announced “Cars 2,” a 2012 sequel that will take Lightning McQueen and his pals on a tour of foreign countries. Also in the works are four direct-to-DVD movies built around Tinker Bell.

“We are definitely planning on doing more sequels, just as we are more originals,” Mr. Lasseter said in an interview. “We talk with Bob Iger about which ones make sense to do from a business perspective. But each movie has to be absolutely great or you will snuff out a franchise.”

And the Pixar team, which also has oversight of Walt Disney Animation Studios and the DVD-focused DisneyToon Studios, decided that it was O.K. to outsource some direct-to-DVD animation to an Indian company, a departure from its rigid stance that outside animators could not deliver the necessary quality. (Mr. Lasseter will still closely monitor the efforts, however.)

For the first time, Pixar is also scheduled to deliver two movies in a single year: “Newt,” the story of a salamander’s search for love, and “The Bear and the Bow,” an action-adventure starring an imperious Scottish princess; both films will arrive in multiplexes in 2011.

How Disney and Pixar are making the integration work holds lessons for other executives faced with the delicate task of uniting two cultures. Tactics that have served the companies well include the obvious, like effectively communicating changes to employees. Other decisions, including drawing up an explicit map of what elements of Pixar would not change, have been more unusual.

“None of this has been easy,” said Richard Cook, chairman of Walt Disney Studios, “but it helps when everyone has tremendous respect both professionally and personally for one another.”

Mutual respect was scarce at the two companies just three years ago.

Pixar, based in Emeryville, Calif., and Disney, with its headquarters in Burbank, Calif., had a notoriously strained relationship. Pixar’s chairman and chief executive, Steven P. Jobs, abruptly called off talks to continue a lucrative partnership with Disney, which had helped to finance and distributed such Pixar films as “Monsters, Inc.”

Mr. Jobs, also the chief executive of Apple, had bitterly clashed with Michael D. Eisner, who was then running Disney. The rift encompassed many issues, not the least of which was basic trust. In one incident, Mr. Eisner disparaged an Apple advertising slogan before a Congressional committee and then claimed that he hadn’t — even though his testimony had been transcribed.

The end result was that Mr. Jobs and others at Pixar didn’t place much faith in what their Disney counterparts told them.

After Mr. Iger took the reins at Disney, he restarted acquisition talks and won some early support at Pixar by talking candidly and clearly about the lessons he learned when his previous employer, the ABC television network, endured two takeovers. Pixar executives recall Mr. Iger joking that if he ever decided to write a book, it would be titled “I’ve Been Bought,” because the two merger experiences were so formative for him.

Edwin Catmull, the president of Pixar who was also put in charge of Walt Disney Animation Studios, said, “It became very clear to us that Bob Iger had been through mergers before, both positive and negative.”

Mr. Iger also agreed to an explicit list of guidelines for protecting Pixar’s creative culture. For instance, Pixar employees were able to keep their relatively plentiful health benefits and weren’t forced to sign employment contracts. Mr. Iger even stipulated that the sign on Pixar’s front gate would remain unchanged.

Still, Mr. Catmull concedes that trust didn’t come easily, especially in an age when some companies promise one thing before a merger and then seem to do another once the deal is done.

“It took about a year before there was a collective letting down the guard,” he said. “Initially people were thinking, ‘Is something going to happen?’ ”

Regarding Disney’s list of promises, Mr. Catmull said: “We’ve never had to go back and look at it. Everything they’ve said they would do they have lived up to.”

Mr. Jobs, who became Disney’s largest shareholder and a board member as a result of the transaction, did not respond to interview requests.

In most acquisitions, the conqueror typically reigns supreme. When NBC bought Universal Studios, executives at the movie studio in Los Angeles were — overnight — required to start commuting to New York for grueling financial planning meetings at the behest of NBC’s owner, General Electric.

Employees were also startled to wake up on the morning after the acquisition announcement to find that their e-mail addresses had already been altered to “nbcuni.”

An NBC Universal spokeswoman declined to comment. Although analysts generally think that Universal Pictures has been well served by the G.E. takeover, they cited the company’s aggressive handling of the merger as one reason the studio’s respected chairwoman, Stacey Snider, quit the company.

But in the Pixar acquisition, Disney, despite its legendary corporate identity and strong will, held back. Pixar kept its e-mail system. Nobody was shipped to Walt Disney World in Florida to work a shift, part of the initiation that other executives must endure. No switchboard operators at Pixar were asked to end telephone calls with the words “Have a magical day,” as they do elsewhere in the company.

And, of course, Mr. Lasseter continued to wear whatever he wanted, Hawaiian shirts and all.

In fact, a deep Disney “introduction and visit” didn’t come until this spring, when a random selection of 200 of Pixar’s 800 employees spent the day in Burbank touring the live-action studio and consumer products division.

“There is an assumption in the corporate world that you need to integrate swiftly,” Mr. Iger said. “My philosophy is exactly the opposite. You need to be respectful and patient.”

Key to the successful integration, analysts say, has been Mr. Iger’s decision to give incoming talent added duties. Instead of just buying Pixar and moving on, Mr. Iger understood what made the acquisition valuable, said Mr. Price, the author. “If you are acquiring expertise,” he said, “then dispatch your newly purchased experts into other parts of the company and let them stretch their muscles.”

In Disney’s case, Pixar was assigned the difficult task of turning around a storied animation department that had fallen into disrepair as it struggled to find its footing in a new world of computer-generated pictures. At a low point, the 2002 film “Treasure Planet” flopped so badly that Disney was forced to take a $98 million write-down.

A window into how the rebuilding effort is going will come on Nov. 26, with the release of “Bolt,” the tale of a Hollywood dog star who becomes lost in New York and has to make his way back to California. Mr. Lasseter and his team have heavily reworked the project, including playing up a wickedly funny side character, a hamster.

Although some bloodletting has been involved in Pixar’s efforts to rebuild the studio — the original director of “Bolt” was replaced, resulting in some hurt feelings — Mr. Lasseter said he was pleased with the way the transformation was progressing. “We were very nervous coming in, but to see the change has been amazing,” he said. “Disney has become a filmmaker-led studio and not an executive-led studio. We are very proud of that.”

The relationship could still sour, of course, and big tests loom.

Still very much a work in progress is the turnaround of Walt Disney Animation Studios, where it has taken Mr. Catmull and Mr. Lasseter longer than investors anticipated to sort through the pipeline of existing projects and begin green-lighting new ones.

Disney’s plans for hand-drawn animation are unclear, with only one project currently announced: “The Princess and the Frog,” a musical set in New Orleans that is scheduled to have its premiere in December 2009. A Disney spokeswoman said animators were deeply immersed in marrying older hand-drawn techniques with new technology for future movies, adding that plans for a new headquarters for Disney’s Burbank animators were slowly progressing.

PIXAR’S list of coming movies includes some with unusual concepts that might not lend themselves to the kind of merchandising tie-ins that have made “Cars” a juggernaut. “Up,” the next big Pixar film after “Wall-E,” is a comedy about a cranky, cane-wielding 78-year-old who transports his home to exotic locales by attaching hundreds of helium-filled balloons.

With the exception of “Up,” which is being directed by Pete Docter (“Monsters, Inc.”), Pixar is placing some of its biggest new projects in relatively untested hands. Brenda Chapman, the director of Pixar’s first fairy tale, “The Bear and the Bow,” served as a story supervisor on modern classics like “The Lion King” but has only one previous directing job under her belt, for “The Prince of Egypt.”

Of course, Mr. Lasseter will be helping to guide the way, but he must cope with extreme demands for his time. Aside from overseeing an ambitious slate of movies, Mr. Lasseter, who now shuttles between Burbank, near Los Angeles, and Emeryville, outside San Francisco, is involved in everything from approving special effects for the coming “Cars” ice tour to helping design theme-park attractions.

He also has new corporate responsibilities, from schmoozing with important investors to helping to push Disney’s efforts with high-definition Blu-ray DVDs. All of this juggling, some people say, has made him somewhat inaccessible. One Pixar insider, who requested anonymity because he was not authorized by the company to speak, joked that scheduling a meeting with Mr. Lasseter has become harder than “lining up a chat with the pope.”

Mr. Lasseter, speaking by cellphone during a commute home, said: “The toughest part of my job is probably just managing my schedule. But I think everything is going pretty well.” He added that there have been times in the past — such as when he was directing “Cars” — that his walk — around time at Pixar was limited. “It ebbs and flows,” he said.

FOR now, attention is focused on “Wall-E.” Directed and written by Andrew Stanton, the creative force behind “Finding Nemo,” the picture tells the story of a cuddly trash-compacting robot who lives on an abandoned, heavily polluted Earth 700 years in the future. His sidekick is a perky cockroach named Hal.

“Wall-E,” which features long sequences without dialogue, is under extra pressure to perform at the box office because of soft initial receipts for a recent Disney film, “The Chronicles of Narnia: Prince Caspian.” Adding to the weight are Pixar’s last three films; though all were blockbusters, they have gradually trended downward at the domestic box office. A reversal would quiet critics who say the studio’s best days are behind it. (Disney notes that an increase in foreign box office sales has offset the slide.)

As with “Cars,” Disney is counting on “Wall-E,” set for release on June 27, to take off with a tough crowd: little boys. It has prepared a collection of 300 robot-themed consumer products that will arrive on store shelves over the next month.

“There are some great toys, and we are working on a variety of potential applications for our parks,” said Mr. Iger in a conference call with analysts on May 6. “So we are poised to take advantage of broad and deep success when it comes.”

(He added that he has particularly high hopes for a “Wall-E” remote-controlled robot. “Having played with it, I think it’s going to be a hot seller for Christmas,” he said.)

Wall Street, which closely monitors major animated movies because of their huge cost, is not yet sold on the robot, which was been criticized by some as looking too much like the star of the corny 1986 film “Short Circuit.”

“I can see how it could work and be huge and I can see how it could not,” said Richard Greenfield, an analyst at Pali Research.

By contrast, the competing DreamWorks Animation has received applause for its coming “Kung Fu Panda,” featuring the vocal talents of Jack Black and Angelina Jolie. Ingrid Chung, a media analyst at Goldman Sachs, said recently that she found the film’s concept and execution “strong enough to create a franchise.” When it came to Pixar, Ms. Chung declined to comment.

Detractors might recall that Road Runner and Wile E. Coyote, two of the most beloved cartoon characters of all time, never uttered a word to each other. And movie theater executives, typically tough to please, reacted with robust laughter and applause during a 30-minute peek at “Wall-E” in April.

“It’s some of the best work I’ve ever seen,” said Mr. Catmull, standing in the aisle of the theater afterward as confetti sprinkled from the ceiling. “I am confident it will be the next success story for Disney and Pixar.”

That License to Kill Is Unexpired
Charles McGrath

IAN FLEMING, had he lived, would have celebrated his 100th birthday on Wednesday. James Bond, his greatest invention, is probably a bit younger, strictly speaking (the evidence in the books is a little contradictory) — except that Bond, of course, is ageless and immortal. Never mind those three packs a day; he has wind to spare. His liver, astoundingly, is still holding up. He has survived not only Fleming but Kingsley Amis and John Gardner, who, among others, kept on publishing Bond novels in Fleming’s stead. With a new Bond book just out — “Devil May Care” by Sebastian Faulks — there are now, in addition to the 12 Bond novels that Fleming actually wrote, almost twice as many that he didn’t.

In the movies, whenever a Bond shows the least sign of faltering, he is immediately unplugged and a new one wheeled in. Sean Connery was unforgettable in the role, and Daniel Craig has yet to wear himself out. His second Bond picture, the 22nd in the saga, called “Quantum of Solace,” whatever that means, is scheduled for release in November. But who any longer remembers poor George Lazenby, even though his sole Bond film, “On Her Majesty’s Secret Service,” was actually one of the best, or Timothy Dalton, whose two Bond flicks were among the worst? As for Roger Moore and Pierce Brosnan, they blend in memory into a sleek, somewhat ironic Bond — a little weary, you feel, from carrying all that history around.

Mr. Faulks’s new book, on the other hand, featuring a slightly weary Bond, improbably injects new life into the formula.

“Devil May Care” is in many ways a stronger novel than any that Fleming wrote, both because it’s better written and because it has all the Bond lore to draw upon. It’s a satisfying thriller in its own right, set in the early ’60s and beginning in Paris — very satisfactorily — with a man getting his tongue pulled out with pliers, then traveling to Iran and Russia.

But it’s also a fond and at times funny homage to all the other books in the series. Felix Leiter, Bond’s old American friend, turns up, only now without an arm and a leg after being tossed into a shark tank in “Live and Let Die.” The villain has one hand that resembles a hairy monkey’s paw, and his sidekick, an Oddjob-like character named Chagrin, has to wear a kepi because after an operation to render him a psychopath, his skull plate no longer fits. And the plot is full of little nods in the direction of famous Bond landmarks: there’s a crooked tennis game, for example, reminiscent of Le Chiffre as a cardsharp in “Casino Royale” and of Goldfinger as a cheater at golf.

At a certain level all the Bond stories are the same story. There’s the villain, the girl (in “Devil May Care,” the appealing and surprising Scarlett Papava) and the plot that threatens the end of civilization. Bond thwarts the first, sleeps with the second, gets beaten or tortured, and then reunites with the girl, often while still in his wet suit.

The movies are even more similar, and almost invariably include set pieces like the opening sequence with the gun barrel and the inevitable, flirty interview with Miss Moneypenny. What varies is mostly the escalating gimmickry of the gadgets, the special effects and the sexiness of the actresses. Ursula Andress, emerging from the waves in a bikini in the first Bond pic, “Dr. No” (1962), set the bar very high, and in some ways viewers have been jaded ever since.

But to a considerable extent it’s the series of Bond movies, one of the most successful franchises in film history, that have kept the books going, after a fashion, and not the other way around. In recent years neither the Fleming originals nor the knockoffs have sold particularly well, though Doubleday has high hopes for the new one and is printing an initial 250,000 copies.

Fleming lived long enough to see only the first two Bond movies, “Dr. No” and “From Russia With Love,” which happen to be the most faithful to his texts. Many of the others have little in common with what he wrote other than a title, and the Bond most of us think we know — suave, debonair, unflappable and, in his later incarnations, a little bland — is more nearly the movie character than the one Fleming invented.

Albert R. Broccoli, a producer of the first 17 Bond films, could be said to be a co-creator of this other, meta-Bond. It was he or his writers who made a trademark of the “Bond. James Bond” line, for example, and who insisted on the “shaken, not stirred” business. Fleming’s Bond is not nearly so fussy about what he drinks, as long as there is plenty of it. He’s as apt to slug down bourbon as a martini. This Bond is also much more fetishistic about smoking than he is about drinking and makes a point of ordering his cigarettes (with three gold bands on the filter) from Morlands of Grosvenor Street. (In a pinch, though, he’ll also smoke Chesterfield kings by the carton, and it’s little short of miraculous that he can climb a flight of stairs, let alone swim for miles, as he so often does.) He likes fast automobiles but hates gizmos, except for the odd concealed knife, and wouldn’t get caught dead with the laser watches, ejector seats, tricked-out cars and exploding key chains the movie Bond has been kitted out with, not to mention that embarrassing jet pack.

Fleming’s Bond also has a dark streak of world-weariness and melancholy we never get to see on screen. He’s casually racist (in “Live and Let Die” especially), misogynistic (giving women the vote encourages their lesbian tendencies, he believes) and anti-Semitic in a way that would never be permitted in the movies. And he’s far kinkier sexually than any of his movie incarnations. Good sex for Bond is sex that has “the sweet tang of rape”; when he first goes to bed with Vesper Lynde, in “Casino Royale,” we’re told, he “wanted to see tears and desire in her remote blue eyes and to take the ropes of her black hair in his hands and bend her long body back under his.” And in a surprising number of incidents Bond is beaten or burned around the genitals — most famously by Le Chiffre in “Casino Royale’ but also by Blofeld in “You Only Live Twice” — to the point where his potency is in question.

In all these respects Bond bears a more than passing resemblance to his creator, except that Fleming was a far nastier piece of work. He was born in Mayfair, London, in 1908, the second son of a well-to-do member of Parliament. Like Bond (whose offense was “trouble with one of the boys’ maids”), he was kicked out of Eton, and he dropped out of Sandhurst. He subsequently failed as a journalist and a stockbroker, and the war was his salvation. With few other qualifications than knowing the right people, he became assistant to the director of naval intelligence and eventually rose to the rank of commander (same as Bond), in charge of his own special operations unit.

After the war he returned, half-heartedly, to journalism and more enthusiastically to his main interest: womanizing. In 1952 he married Lady Anne Rothmere, with whom he had been carrying on during her two previous marriages. Their relationship was intense but not particularly faithful on either side, and it was based on a shared taste for what the French call le vice anglais. “I am the chosen instrument of the Holy Man to whip some of the devil out of you,” he wrote to her once, “and I must do my duty however much pain it causes me. So be prepared to drink your cocktails standing for a few days.”

Fleming died in 1964, a premature wreck done in by Bondian habits: 70 cigarettes and a bottle of gin a day. By then he looked, friends said, like a bloodhound who had been out in the sun too long. But the novels, which some of his writer friends, like Evelyn Waugh and Cyril Connolly, delighted in poking fun at, brought him satisfaction and a sense of purpose, not to mention a very nice stream of income. He wrote the first, “Casino Royale,” in just four weeks in 1952, and once he hit on the formula he never deviated, publishing a Bond novel a year until he died. There are better Bond books, and worse ones, but they don’t really evolve, any more than Bond himself does.

At a certain level the Bond books are cold war fantasies, celebrating material comfort and diplomatic importance at a time when Britain didn’t have a great deal of either. When Fleming began writing, British families were still using ration cards and the Empire was mostly a memory. So the books were really wish fulfillments; they took British readers to places, like Jamaica and Haiti, where most of them could never imagine going, and on Bond they projected an image of competence and worldly wisdom.

The plots run as efficiently as Bond’s 4.5-liter Bentley, with scarcely a wasted word, but the books are also extravagant, with their over-the-top villains — Hugo Drax, Emilio Largo, Goldfinger, Ernst Blofeld and his creepy consort, Irma Bunt — and their parade of barely clad heroines so absurdly named they sound like lingerie brands: Solitaire, Tiffany Case, Honeychile Rider, Kissy Suzuki. You get the sense that Fleming — bored, cynical and out of sorts — wrote them to entertain himself as much as the reader. All of them were knocked off at Goldeneye, his estate in Jamaica (now a boutique hotel), with time out for cocktails and snorkeling.

The formula seems easy to imitate, but most of the Bond knockoffs are pretty disappointing. The dozen or so by Mr. Gardner are particularly bad; they’re clumsily written and manifest a regrettable politically correct tendency, giving Bond low-tar cigarettes to smoke, for example, and a Saab to drive. But even Mr. Amis’s Bond novel, “Colonel Sun,” which was published in 1968 under the name Robert Markham, is a little stiff and joyless. Mr. Amis, who also wrote “The Book of Bond, or Every Man His Own 007,” loved the Bond novels and wasn’t slumming when he agreed to try one.

If anything, he took the project too seriously. “Colonel Sun” is fussily written, without Fleming’s flair for sweeping generalizations, and the plot — a Communist Chinese scheme to wreak havoc on the Middle East — is literal and overly complicated. Even worse, the girl, a Greek partisan named Ariadne, and the villain, Colonel Sun, are dull and uninspired. The latter’s evilness seems to consist mostly of just being Chinese, or “a yellow slug,” as M., Bond’s superior, calls him. Mr. Amis doesn’t even do much with the sex scenes, which are of the “they had become one creature with a single will” variety, though he does manage a nice torture sequence, with the colonel, who scorns genital assault as “too unsophisticated,” preferring to drive a skewer through his victim’s eardrum.

Mr. Faulks is not a thriller writer but a highly regarded writer of literary fiction, probably best known for “Birdsong,” set in World War I, and “Charlotte Gray,” set in World War II. Both feature a certain amount of spying, though not of the Bondian sort. His last book, “Engleby,” is about a journalist who becomes a psychopath.

When Mr. Faulks was first approached by the Fleming estate, he “thought it was pretty droll, actually,” he said in a recent phone interview from London, where he lives. “I thought I was a very odd choice indeed, and I was amused by the whole idea.” But Mr. Faulks was between books at the time, so he agreed to reread the Bond novels, which he hadn’t looked at since he was a teenager. “They were quite a lot better than I thought they would be,” he said. “I wouldn’t say I was on the edge of my seat, but I did enjoy them, and I thought they were pretty well written, in a journalistic way — free of cliché. There are some very silly things, like the plot of ‘Goldfinger,’ and some of the names of people are just ridiculous. But on the whole my reservations rather evaporated.”

One key to a successful knockoff, he decided, was finding the right story, and eventually he came up with one that involved both the catastrophic cold war ominousness that Fleming so loved and the kind of specific crime plot that energizes the best of the Bond novels. In “Devil May Care” the villain is trying to undermine Western civilization by addicting everyone to cheap drugs. A subplot involves a rogue C.I.A. operative who wants to drag Britain into Vietnam.

“Mostly I just had fun,” Mr. Faulks said. “I wrote the book the way Fleming did — 2,000 words a day, except I left out the cocktails and the snorkeling.”

“Tuning into the style was the difficult thing,” he continued. “You have to hear the tone. That applies to your own book as well as to anyone else’s. And so finding that style, that pitch, was all-important. With Fleming, once I’d got his voice I developed a sentence structure that was about 20 percent mine and 80 percent his — plenty of verbs, not many adverbs or adjectives. The real danger was getting too close and then winding up in parody territory.”

He added: “I didn’t anguish, and I didn’t feel Fleming looking over my shoulder. The only difficulty I had was when I wanted to slow the story down, to allow a page or two for something significant to sink in. I thought that I could draw a little on Bond’s inner life, but I found that Bond doesn’t really have an inner life.”

Michelangelo for Readers With Deep Pockets
Elisabetta Povoledo

The gala presentation of “Michelangelo: La Dotta Mano” (“Michelangelo: The Wise Hand”), a volume of photographs of this Renaissance master’s sculptures, may well have been the most lavish book debut in history.

With Piazza Maggiore, Bologna’s main square, as the backdrop, a short video depiction of the volume, which can be seen on www.fmronline.it, was followed on Thursday night by an hourlong spectacle that included dozens of costumed dancers, a string quartet playing from a stage suspended in midair, suckling pigs roasted over a pit, a fake snowfall and a foppishly dressed acrobat walking Spiderman-style up the facade of San Petronio, the city’s cathedral.

But then, this is no ordinary book, starting with its retail price of 100,000 euros, or around $155,000, at Friday’s exchange rate.

Included in the price of what its publishers are calling “the most beautiful book in the world” is a sleek black case, its own stand and a 500-year guarantee.

“This isn’t an appliance,” Marilena Ferrari, chairman of the book’s publisher, Gruppo FMR, told Bologna’s mayor and guests at the book’s official presentation in a grand salon in City Hall on Thursday morning. “That’s the amount of time we feel we can guarantee the materials we used to craft it.”

Using the high standards of the privately published books in the 19th century — an ideal known as the “book beautiful” — as a starting point, FMR sought expert artisans from various fields to create something Ms. Ferrari described as “a work of art in itself.”

Aurelio Amendola’s black-and-white photographs were printed on paper made exclusively for the project. There are detachable reproductions of Michelangelo drawings on handmade folios created according to centuries-old traditions. And then there’s the cover: a scale reproduction in marble of the “Madonna della Scala” (“Madonna of the Steps”), a bas-relief of the Virgin and Child sculptured by Michelangelo when he was still in his teens. The original is housed in the Casa Buonarroti in Florence.

It took two white-gloved attendants to lug around the 46.2-pound book at its City Hall debut.

The marble cover was the trickiest aspect of production.

“It was difficult to find the right depth,” said Nanni Tamar, the project’s production manager. Six sculptors of marble are working on the first 33 copies in a limited edition of 99. “We broke a lot of slabs along the way,” Mr. Tamar said.

This isn’t the most expensive book ever made. There are books incorporating precious metals or gemstones that increase the price, like that of the entrepreneur Roger Shashoua, whose memoir, “Dancing With the Bear,” according to its Web site, dancingwiththebear.com, comes in a diamond-encrusted “special oligarch” edition that ranges in price from $1 million to $6 million.

Luxury publishing in general seems to be on the upswing. “From my experience, it’s growing,” said Ovais Naqvi, chief executive of Gloria, a new luxury publisher that this year came out with a book about New York City that sells at $2,500 to $15,000.

“There are a certain amount of people who are testing how far the market can be pushed,” Mr. Naqvi said.

Because production of the Michelangelo book is so labor-intensive (Ms. Ferrari likened the process to a Renaissance workshop), aspiring buyers can expect a six-month wait, the same as for a Ferrari (the car), said Pietro Tomassini, FMR’s commercial director.

“We think it will sell out in a very short time,” he said. Customers in the United States, Europe and Russia have already reserved copies, he added, though he declined to say how many.

Cristiano Collari, the book specialist for Christie’s auction house in Milan, was a little taken aback by the price, which he said was comparable to that of good copies of rare ancient texts like the “Hypnerotomachia Poliphili” (1499), which he described as the “bibliophile’s prime fetish.” But even contemporary art books can turn out to be good investments, Mr. Collari said, though the market is always hard to predict.

For this first title in its “Book Wonderful” series — apart from a forthcoming book about Catherine de Medici, the rest are top secret — FMR chose to pay homage to Michelangelo and to time its publication to coincide with the 500th anniversary of the first painted stroke on the Sistine Chapel ceiling in the Vatican, which took place in May 1508.

The question remains, who would pay so much for such a book?

Franco Negretto, a financial consultant here who was awed by Thursday night’s spectacle — “I’ve seen a lot of shows in this square, but this was one of the best” — said he’d been sold by FMR’s pitch, despite the price tag.

“I’ll do everything I can to buy it,” he said solemnly.

Electronic Device Stirs Unease at Book Fair
Edward Wyatt

Is the electronic book approaching the tipping point?

That topic both energized and unnerved people attending BookExpo America, the publishing and bookselling industry’s annual trade show, which ended at the convention center here on Sunday.

Much of the talk was focused on the Kindle, Amazon’s electronic reader, which has gained widespread acclaim for its ease of use. Jeffrey P. Bezos, the founder and chief executive of Amazon, spent much of a packed session on Friday evangelizing about the Kindle, which he said already accounts for 6 percent of his company’s unit sales of books that are available in both paper and electronic formats.

But excitement about the Kindle, which was introduced in November, also worries some publishing executives, who fear Amazon’s still-growing power as a bookseller. Those executives note that Amazon currently sells most of its Kindle books to customers for a price well below what it pays publishers, and they anticipate that it will not be long before Amazon begins using the Kindle’s popularity as a lever to demand that publishers cut prices.

Overall, traffic at the book fair seemed lower than in past years, a reflecting perhaps that some editors did not make the long trip west from Manhattan, as well as the fact that the growth in the book business has slowed.

While authors including William Shatner, Andre Dubus III and Ty Pennington drew big crowds of booksellers seeking autographs, several books by little-known authors scheduled for publication were being pushed hard by publishers. Those include two that use witches, of a sort, as their protagonists and one whose author is in shaman training.

One, “The Heretic’s Daughter,” is a novel about Martha Carrier, the first woman to be accused, tried and hanged as a witch in Salem, Mass. The author, Kathleen Kent, is a 10th-generation descendant of Carrier (though not a witch herself, said Reagan Arthur, an editor at the book’s publisher, Little, Brown). Another, “The Lace Reader,” by Brunonia Barry, is set in modern-day Salem, where the narrator hails from a family of women who can read the future in a pattern of lace. The novel, being published by William Morrow in July, was previously self-published by the author.

Kira Salak, the author of the third novel, “The White Mary,” draws on her travels across Papua New Guinea for an account of a journalist searching for a missing reporter who is thought to have committed suicide but might still be alive. According to Sarah Knight, an editor at Henry Holt, the author has undergone shaman training in Peru.

Booksellers, who make up the other major group attending the publishing convention, are also concerned that electronic books could become more than a passing fancy for an electronically savvy subset of customers. “It certainly does feel like a threat,” said Charles Stillwagon, the events manager at the Tattered Cover Book Store, a large independent bookseller in Denver.

Nearly all publishers say their sales of electronic books are growing exponentially. Carolyn K. Reidy, the chief executive of Simon & Schuster, said its sales of electronic books will more than double this year compared to last year, after growing 40 percent in 2007 from 2006. David Shanks, the chief executive of Penguin Group USA, said his company sold more electronic books in the first four months of 2008 than in all of last year.

The numbers are still small, which helps to account for the rapid growth. Ms. Reidy said that electronic book sales last year totaled about $1 million, a sliver of its annual sales of roughly $1 billion. During the convention, Simon & Schuster said it would convert an additional 5,000 titles to electronic format this year, more than doubling its number of electronic books and making available many of the best-selling books on the company’s backlist of consistent sellers.

Electronic books have been available since 1968 and have gained broader attention at least since 2000, when Stephen King sold 600,000 copies of “Riding the Bullet,” an electronic-only thriller, in two days. Now, however, “we’re finally at the tipping point,” Ms. Reidy said.

Much of the expected growth in electronic books can be tied to the Kindle. When Amazon introduced the product, it sold out of the machines on the first day. The company needed months to adjust its manufacturing capacity and supply chain to be able to keep Kindles in stock, which Mr. Bezos said it has now accomplished.

The chief competitor to the Kindle is the Sony Reader, which has been on the market since 2006 and has also helped boost sales of electronic books. Some technology critics have given the early advantage to the Kindle, however, which downloads books, daily newspapers and magazines wirelessly; the Sony Reader downloads content via a wired connection.

Even Mr. Bezos said he does not expect electronic books to replace bound paper versions anytime soon. “Anything that lasts 500 years is not easily improved upon,” Mr. Bezos said. “Books are so good you can’t out-book the book.”

But he also claimed that Kindle users are buying more books, not simply exchanging one format for another. He said that after buying a Kindle, Amazon customers purchase just as many physical books and two and a half times as many books overall, or three electronic books for every two physical copies.

Some publishing executives dispute that claim. “We don’t see people buying both versions,” Mr. Shanks said. “I think there is almost a one-to-one cannibalization.”

But neither Amazon nor Sony will say how many of their products they have sold, making it impossible for publishers to assess the size of the market or for bookstore owners to evaluate the threat.

One publisher estimated that Amazon had sold roughly 10,000 Kindles, while another estimated that as many as 50,000 electronic-book readers of all types are in general circulation. But both publishers, who spoke on the condition of anonymity, said that those figures were little more than educated guesses.

Amazon sells most Kindle books for $9.99 or less. Publishers say that they generally sell electronic books to Amazon for the same price as physical books, or about 45 percent to 50 percent of the cover price. For a hardcover best seller like Scott McClellan’s “What Happened,” the former press secretary’s account of his years in the Bush White House, that would mean that Amazon appears to be selling the selling the book for about 25 percent below its cost.

(Mr. Bezos probably did not endear himself to people in the publishing industry fearful about his company’s power when, in response to a question after his speech, he waxed enthusiastic about how his “lottery ticket” wealth from the success of Amazon is allowing him to invest in a project to provide commercial travel to suborbital space.)

Electronic readers have nevertheless gained many fans in the publishing industry. Random House and Penguin, among others, have equipped their entire sales force with electronic-book readers, allowing them to avoid having to lug around as many preview editions of books. Editors at many of the larger publishing houses also use the devices to read manuscripts submitted by agents and authors.

A big advantage of the products is that bookstores never sell out of copies of an electronic book, something Mr. Bezos demonstrated by downloading and reading from “What Happened,” which in hardcover format has sold out in many stores. Amazon itself expects to be unable to ship new copies until June 21, according to its Web site. Barnesandnoble.com says it expects the book to be available June 6. That too makes bookstore owners nervous about the future of electronic books. “We’re always concerned with any competition,” Mr. Stillwagon, of Tattered Cover, said. “The technology has progressed, and people are embracing it. For us, every book sale counts.”

I’m my own grandpa

RepRap - Open Source Machine 'Prints' 3-D Objects, Including Copies Of Itself

Dr Adrian Bowyer, a senior lecturer in engineering in the Faculty of Engineering & Design at the University of Bath, has created RepRap, an open source prototype machine that has succeeded in making a duplicate of itself - by printing its own parts and building a clone.

RepRap is short for replicating rapid-prototyper. RepRap employs a technique called ‘additive fabrication’. The machine works a bit like a printer, but rather than squirting ink onto paper, it puts down thin layers of molten plastic which solidify. These layers are built up to make useful three-dimensional (3D) objects.

RepRap has, so far, been capable of making every day plastic goods such as door handles, sandals and coat hooks. Now, the machine has also succeeded in copying all its own 3D-printed parts.

These parts have been printed and assembled by RepRap team member Vik Olliver in Auckland, New Zealand, into a new RepRap machine that can replicate the same set of parts for yet another RepRap machine and so on ad infinitum. While 3D printers have been available commercially for about 25 years, RepRap is the first that can essentially print itself.

The machine will be exhibited publicly at the Cheltenham Science Festival (4-8 June 2008).

Dr Bowyer said: “These days, most people in the developed world run a professional-quality print works, photographic lab and CD-pressing plant in their own house, all courtesy of their home PC. Why shouldn't they also run their own desktop factory capable of making many of the things they presently buy in shops, too?

“The possibilities are endless. Now, people can make exactly what they want. If the design of an existing object does not quite suit their needs, they can easily redesign it on their PC and print that out, instead of making do with a mass-produced second-best design from the shops. They can also print out extra RepRap printers to give to their friends. Then those friends can make what they want too.”

Recently, Chris DiBona, Open Source Programs Manage at Google Inc, encouraged people to: "Think of RepRap as a China on your desktop."

Sir James Dyson, Chief Executive of the Dyson Group, said: “RepRap is a different, revolutionary way of approaching invention. It could allow people to change the ergonomics of a design to their own specific needs.”

Dr Bowyer hopes people will come to the Cheltenham Science Festival and see both the 'parent' and the 'child' RepRap machines in action for the first time together.

"RepRap is the most enjoyable research project I've ever run," he said. "And without the many talented and selfless volunteers the RepRap project has all round the world, it would have never succeeded so quickly."

Complete plans for the prototype RepRap 3D printer and detailed tutorials to aid motivated amateurs (and professionals) in assembling one are available to everyone free at the RepRap website (details below). The materials, plus the minority of parts that the machine cannot print, cost about Ł300. All those non-printed parts can be bought at hardware shops or from online stores.

Adrian and several of the other Reprap team members will be available to answer questions and exhibit the parent and child Darwin printers in operation at the Cheltenham Science Festival on 4 – 8 June 2008.
http://www.scientificblogging.com/ne... es_of_itself

Windows 7: The Story So Far
Gregg Keizer

This week, Microsoft Corp. went on a 24-hour marketing blitz to talk up the next version of Windows, simply called "Windows 7" for now.

Although some of what Microsoft's executives and spokespeople had to say was how much they weren't going to say and why, a few informational dribs and drabs have worked loose from Redmond.

What, exactly, do we know about Windows 7, the successor to Vista -- the operating system that if not troubled then at least, as Gartner analyst Michael Silver puts it, carrying " a lot of perception issues?"

Not a lot. Certainly not nearly enough for some of those constituencies thirstiest for details. But here's what we do know, or at least know because Microsoft's said it's so.

When will Windows 7 be released? Depends on who's talking, apparently. Early Tuesday, two Microsoft executives, Chris Flores, a director with the Windows Client communications team, and Steve Sinofsky, the senior vice president who heads Windows development, both pegged the release of the Vista follow-on as early 2010.

"We're happy to report that we're still on track to ship approximately three years after the general availability of Windows Vista," said Flores in an entry on a company blog.

"[We] will continue to say that the next release of Windows, Windows 7, is about three years after the general availability of Windows Vista," Sinofsky told News.com that same morning.

Tuesday night, however, another company executive -- the one who heads the org chart, in fact -- said different. At the Wall Street Journal 's All Things Digital conference, Steve Ballmer , Microsoft's CEO, put Windows 7's ship date as "late 2009."

The spread between early 2010, which would be the "three years after the general availability of Vista" -- that OS went into general distribution at the end of January 2007 -- and "late 2009" may not sound significant, but only a few months separated Vista's actual release from an earlier date that would have meant the operating system made it into computers in time for those PCs to sell during the 2006 holiday season.

What will Windows 7 be like? Under the hood, a lot like Vista, according to the tidbits that Microsoft tossed out this week.

Flores was almost expansive on the subject, and noted that Windows 7 would "carry forward" the "long-term architectural investments" made in Vista. "Windows Vista established a very solid foundation, particularly on subsystems such as graphics, audio, and storage. Windows Server 2008 was built on that foundation and Windows 7 will be as well," he said.

In fact, Sinofsky and Flores confirmed other like-Vista aspects of Windows 7, including the fact that the new OS will be released in both 32- and 64-bit versions -- there was some speculation earlier that it would be a 64-bit operating system only -- and would, as Flores said, run on the same hardware as recommended for Vista.

Has Microsoft said anything about specific features it plans to ship in Windows 7? A little, but only that. Tuesday night, Microsoft demonstrated a touch-screen feature that the company said would be integrated into Windows 7.

The feature, which incorporates technology Microsoft debuted last year as its Surface project, appears similar to the gesture-based multi-touch tools built into Apple Inc.'s iPhone and MacBook Air, though on the latter the touch is limited to a larger-than-normal trackpad, not the entire screen.

Nothing else? The sessions list for the upcoming Professional Developers Conference , scheduled to run Oct. 26-30, has a couple of clues.

One session, says the current list, will focus on battery life -- presumably batteries in notebooks first of all, but also for other mobile devices Microsoft hopes to get Windows 7 into.

"Windows 7 provides advances for building energy-efficient applications," says the write-up. "In this session we will discuss how to leverage new Windows infrastructure to reduce application power consumption and efficiently schedule background tasks and services."

Other sessions at the conference will tackle such Windows 7 topics as "Graphics Advances," "Touch Computing" (but we already knew that), and "Web Services in Native Code." That last sounds intriguing, considering Microsoft's push-push-push on its "Software + Services" concept.

The OS, says Microsoft, will include a new networking API (application programming interface) to support building SOAP-based Web services in native code. "This session will discuss the programming model, interoperability aspects with other implementations of WS-* protocols and demonstrate various services and applications built using this API."

Will Windows 7 sport a new kernel? Nope.

Last October, a Microsoft engineer revealed that the company had 200 programmers working on slimming down the Windows kernel for Windows 7; he dubbed it "MinWin" and said it would sport a memory footprint less than one-sixth that of Windows Vista's kernel.

Last week, though, Flores and Sinofsky both said Windows 7 won't sport a new kernel. "Contrary to some speculation, Microsoft is not creating a new kernel for Windows 7," Flores said.

Sinofsky put it differently. "The key there is that the kernel in Windows Server 2008 is an evolution of the kernel in Windows Vista, and then Windows 7 will be a further evolution of that kernel as well," he said.

Will Windows 7 be a major or a minor release? The parsing of these adjectives is important because post-Vista, Microsoft said it was planning to update its operating systems on an alternating major-minor basis, with the major upgrades -- think XP to Vista -- every four years, with minor ones in between. A good example of a minor upgrade would be Windows XP SP2, which though called a "Service Pack," was unlike any other SP in the new features and capabilities it added to the previous OS.

Trouble is, Windows 7 sounds like a minor upgrade, but Flores and Sinofsky called it the opposite. "Another question we often get asked is whether Windows 7 is a major release," said Flores. "The answer is 'yes'."

Sinofsky used the adjective "major" six times during the interview with News.com, as in "major undertaking," "major release," and "major and significant release."

Another clue: Windows 7 will use the same device driver model as Vista. That OS, remember, required new drivers for all hardware -- a disruption that even company executives struggled with, as some said in internal e-mails released earlier this year as part of a class-action lawsuit against Microsoft.

The mixed message -- is it major or is it minor? -- confused at least one analyst. Michael Cherry of Directions on Microsoft. "To me, a 'major' update means major changes to the core functionality of the operating system." With Microsoft saying it was going to build atop Vista, not start from scratch, Cherry said he wasn't getting the impression that core functional would significantly change.

Why is Microsoft playing it so close to the vest on Windows 7? Good question.

Microsoft essentially said it learned a lesson from Vista, when it promised features -- such as a retooled storage subsystem called WinFS -- that it ended up yanking from the operating system as development dragged and deadlines grew near.

"We can significantly impact our partners and our customers if we broadly share information that later changes," said Flores in a separate entry on a Microsoft blog Tuesday.

Analysts, including Directions' Cherry and Gartner's Silver, said much the same. "They talked more publicly about Vista, but in the end that didn't make them a lot of friends," noted Silver earlier this week.

So, is Microsoft dumping Vista? No. Company executives, including its CEO, came to praise Windows Vista, not bury it, even as they touted its replacement.

Steve Ballmer defended Vista Tuesday when he talked at the All Things Digital conference. "Vista is not a failure, and it's not a mistake" Ballmer said in response to a question. Nor is Microsoft throwing in the Vista towel. "Are there things that we will continue to modify and improve going forward? Sure," Ballmer added.

Flores, meanwhile, trumpeted Vista's sales numbers. "As of March 31, we had sold more than 140 million Windows Vista licenses," he said.

The Confessions of Barry Diller

The media mogul almost lost it all in an epic battle with partner John Malone. Now he talks about what went wrong—and how he plans to reinvent himself one more time.
Duff McDonald

It's a few weeks before Barry Diller almost lost everything, and he is in his element, at the Four Seasons restaurant in midtown Manhattan. Movie producer Harvey Weinstein is here, as is activist investor Carl Icahn. Diller, uncharacteristically, is sharing the spotlight with CBS chief Les Moonves in a panel discussion about the future of media.

Eventually, the subject turns to Diller himself, whose future at this moment looks precarious. For once, a man who has made a career of micromanaging his own myth is scriptless. The following week, a state court judge in Delaware will hear a lawsuit between Diller and John Malone, the media executive and erstwhile Diller ally who is threatening to strip Diller of everything: his control of IAC/InterActiveCorp, the internet company the two have been bickering over; Diller’s perch inside the Frank Gehry-designed IAC building, on Manhattan’s West Side; his reputation as one of the last of the badass brawlers in the media world; and perhaps most important, his peerless—and until now nearly flawless—ability to craft and maintain his own legend, even if IAC’s performance of late hasn’t exactly seemed to warrant it. (View slideshow.)

“It’s very odd that two people who don’t want to give up control of anything are giving control to a judge in Delaware," Diller says. “It’s unfortunate.”

Within a few weeks, Diller was vindicated. In late March, the judge ruled in his favor, Malone was forced to give up his fight, and an embarrassing public showdown ended. But Malone and his colleagues at Liberty Media had managed to use the trial to get to the heart of the Diller myth. With testimony and evidence that seemed relevant only in its capacity to embarrass the mogul, Diller’s adversaries made an issue of his huge paycheck and lavish lifestyle, as contrasted with the subpar performance of IAC, which has recently been an unqualified disappointment. (View an interactive feature explaining the ups and downs of Diller’s career.)

A few weeks after the court’s ruling, in a conference room just outside his spacious office in the IAC building, Diller still has the air of someone who has just survived a car crash. Instead of dismissing every third or fourth question with his trademark disdain, he is displaying an un-Dillerlike mellowness. “It was absolutely not something we sought,” he says somewhat quietly when I ask about the trial. “The only thing that remains is that it’s over.”

Diller then proceeds to make an astonishing admission: After all this time spent selling the world on his idea of an internet conglomerate, he now realizes that he was wrong from the start. Diller says he’s utterly committed to the idea of an anticonglomerate, blowing up IAC and leaving the company’s disparate parts to operate on their own. “We decided, ‘Enough of this integrated-conglomerate pretension.’ We were kidding ourselves if we thought we could pull off an integrated conglomerate that acts like G.E. or P&G in anything less than 10, 20, or 30 years. It took them 100 years to get there.” (Read Lloyd Grove's interview with Diller, here.)

If Diller were running for president, his rivals would label him a flip-flopper, and they would be right. But Diller is no politician, despite a personal magnetism that is reminiscent of Bill Clinton’s. Nor is he a typical businessman. Rather, he is a bundle of contradictions. He is a onetime internet visionary now accused of being a has-been. He is a Hollywood showman out of context in the nerd’s world of the internet. He is a dealmaker masquerading as a day-to-day executive. And more recently, he has become a man whose outsize legend has seemed increasingly at odds with his ability to deliver the goods.

But now, at the age of 66, he has a new plan—to dismantle his 13-year-old company and create five separate units. The part Diller himself will continue to run will be made up of a number of relatively small entities. With so few pieces to keep track of, this so-called new IAC will be a model of transparency compared with the old one.

Diller is forthright in saying that his strategy for IAC over the years has been guided as much by curiosity as by anything that might constitute an actual business plan. This is a novel approach for the leader of a publicly traded company. The only others who practice it so openly are Larry Page and Sergey Brin, at Google. But their curiosity has been justified by wealth creation to the tune of $170 billion, a far cry from Diller’s own. Yet as George Mair wrote in his 1997 book, The Barry Diller Story, “Diller is one of the few executives in the entertainment business who can raise billions of dollars with just his name and vision as collateral.”

IAC’s roots trace back to 1995, when Diller, recently fired from home-shopping network QVC, hooked up with Malone at a broadcasting company called Silver King, which the two later merged with the Home Shopping Network, QVC’s main rival. From there, HSN embarked on a dizzying series of acquisitions, shifting its focus from shopping to entertainment and eventually to the internet. A number of Diller’s moves were particularly well-timed. In 1997, he bought the USA Network and a passel of other entertainment properties from Seagram, sold them at a profit to Vivendi, and secured himself a $275 million gig as a part-time executive in the process. In doing so, he also extracted a concession from Malone about his future autonomy that proved to be his ace in the hole in March.

His early Web moves were prescient. Deals of note include nabbing 50 percent of Ticketmaster from Microsoft co-founder Paul Allen in 1997 in exchange for 17 percent of HSN, snatching up Hotels.com and Match.com in 1999, and paying $1.5 billion for 51 percent of travel website Expedia in 2002. In mid-2003, investors were cheering him on from the sidelines, and the market valued IAC at about $60 billion.

But since then, Diller has seemed less a visionary and more a spastic dealmaker. He has missed some big acquisition opportunities, including MySpace, which was snapped up by News Corp. for a fraction of what it’s worth today, and ticket broker StubHub, which would have folded in nicely with Ticketmaster. Instead, Diller went in for questionable deals, such as the 2005 purchase of the old-media catalog company Cornerstone Brands, an acquisition he has described as a mistake, and the 2006 purchase of ShoeBuy.com, a distant also-ran behind market leader Zappos.com.

His once-vaunted theme of interactivity, which had a sexy sheen 10 years ago, now seems stodgy, akin to making “We sell things” your corporate mantra.

His costliest misstep has been holding onto mortgage middleman LendingTree, which he purchased for $726 million in 2003. Diller could have made a fortune for IAC if he had sold LendingTree at the height of the housing boom in 2005, which is the kind of move you’d expect a master dealmaker to pull off. Instead, he held on, and he now admits that the unit is worth “vastly less” than what he paid for it. IAC wrote down the value of LendingTree by $475.7 million in 2007. Expect more where that came from.

While Diller may be perceived as a titan, Cowen & Co. analyst Jim Friedland says the value he’s created in the recent past has been puny. “Give or take, the return on invested capital has roughly been between 4 and 5 percent over the past several years,” Friedland says, “which is about the same return you could have received if you’d bought a Treasury bond.” If IAC’s cost of capital is 10 percent, which is Friedland’s estimate, Diller and his curiosity have been destroying value to the tune of about 5 percent a year since 2004.

Of course, the most relevant measure of the value of a publicly traded company is the price of its stock. From December 31, 2004, through April 25 of this year, IAC stock was down 63.3 percent, while the Nasdaq composite index had gained 11.4 percent. The company has pretty much been going through one wrenching transition after another for the past several years, and the stock has performed poorly over much of that time. The synergy that Diller so desperately sought among the more than 60 individual brands IAC owns has failed to materialize in any meaningful fashion. Diller nevertheless points out that IAC stock is up 237 percent since the company’s creation in 1995, even as the S&P 500 has risen only 138 percent.

"The best asset they have is Diller, who is running an internet company the same way you'd run a media conglomerate," says senior analyst Jeffrey Lindsay of Sanford Bernstein. “He had a good run for a few years, when the assets were firing on all cylinders. The mark of a very good business, though, is how well it can ride out a downturn. At this minute, it doesn’t seem to be doing it that well.”

The Gehry-designed IAC building is a monument to Diller himself. It’s a flashy, shape-shifting wonder at the edge of New York’s hottest neighborhood. Getting to Diller starts with walking through a lobby that seems designed for a catered cocktail party. A massive video screen showing the traffic on various IAC websites sits behind the reception desk.

The inner sanctum is dead quiet. The offices of just five executives—each with its own balcony—take up the entire sixth floor. It’s hard not to be intimidated. Indeed, many people who have crossed paths with Diller in recent years warned me not to take it personally if he came across as belittling. In fact, he is disarmingly polite, almost soft-spoken. He is smaller than you would expect but gives off an air of bottled intensity.

The Diller legend has been laboriously constructed, put together piece by piece. There were the nights at Studio 54 in New York 30 years ago, when he hung out with Warren Beatty, Calvin Klein, and Mike Nichols. He was named ABC’s programming chief at the age of 26. At 32, he was offered the chairmanship of Paramount. From there he went on to launch the Fox network. The lasting impression is that for a while, Diller was the ultimate Hollywood mogul. “In the flesh, he was power incarnate,” producer Dawn Steel wrote in her book They Can Kill You but They Can’t Eat You. “He was the sexiest man I’d ever met. He handled power differently from anyone I’d ever known, in this very complex, sexual way.... You couldn’t not look at him.” (VIDEO: Watch Diller explain how he broke into the entertainment industry with no college degree.)

Diller was always a hybrid, equal parts business guy and showman. Like his old friend David Geffen, with whom he worked in the mailroom at the William Morris Agency, he is addicted to the deal. At Paramount, he cooked up tax-advantaged deals structured in ways that other moguls couldn’t understand. He’s bought and sold more companies than Rupert Murdoch himself.

More than that, he was making the connections and building the reputation that would last him throughout his career. Some of the most powerful executives in Hollywood in the past 20 years—Michael Eisner, Jeffrey Katzenberg, Dawn Steel, and producer Don Simpson—worked for him at Paramount, where they became known as the Killer Dillers. At Fox, he teamed up with Murdoch, who remains a close friend. When Murdoch sealed the deal to buy the parent company of the Wall Street Journal in August, Diller hosted a party for him on a yacht anchored off Manhattan.

“Sure, he’s a bundle of contradictions. But most people—most people I like, anyhow—are,” says Kurt Andersen, a media veteran who has done business with Diller over the years—including, most recently, the launch of the website VeryShortList.com. “If you’re famous, your public persona can often be reduced to a noncontradictory cartoon. But with Barry, his contradictions are just more vividly apparent than most.”

Diller has also consistently cultivated strong relationships with the media, providing financial support for The Charlie Rose Show, for example. As a result, he’s been a repeat guest on the program. He’s also bankrolling a news-aggregation website headed by former New Yorker and Vanity Fair editor Tina Brown. “He expresses himself better than anyone I know in business,” Brown says.

“Take him on at your peril,” warns Howard Stringer, the chairman of Sony. “People in the press are afraid to ask him a stupid question because the entire world will know in 30 seconds how stupid it is.”

Diller has used his formidable social and media networks to help wall off his public persona from his business one, an invaluable trick in tough times. Social chronicler Dominick Dunne—who sat at the same table as Diller at an awards ceremony only weeks before Diller’s trial was set to begin—makes that clear. “You never would have had a clue from his conversation or his speech that he was dealing with big problems in his life,” Dunne says, referring to the fight with Malone. “I admire him for that.”

Diller crafts his private persona as carefully as his public image. The social life on display is that of a bon vivant who swans around New York and Hollywood with his wife of seven years, fashion designer Diane von Furstenberg. Diller owns one of the world’s largest private yachts, the 305-foot-long Eos, and hosts a lavish pre-Oscars party at his home in Beverly Hills’ Coldwater Canyon. But in fact, Diller is a fiercely private man who spends much of his time while in New York at the Carlyle Hotel. Few know, for instance, that his brother was murdered in California in 1975 after a number of run-ins with the law. And though speculation about Diller’s sexuality has swirled for years, he has never addressed the topic.

There's no denying that Diller is an extremely smart man. He speaks in well-constructed paragraphs. It's received wisdom in media circles that you don’t tangle with him. There’s the story about the time he threw a videocassette at someone’s head and the one about his making a senior executive cry. While his supporters go to great lengths to cast his prickliness in a positive light, the truth is that the guy can be ruthless. “He’s got elephant balls,” David Geffen once told a reporter.

John Malone surely knew this, which is probably why he hired technology executive Greg Maffei as C.E.O. of Liberty Media in 2002. If, as has been speculated, Malone was about to set Liberty on a collision course with IAC—and by extension, Diller—he might as well have a fall guy in the event the strategy failed. While Maffei had an impressive résumé, with senior-executive stints at Microsoft and Oracle, what he also had was a contentious history with Diller. Maffei had been chairman of Expedia when it was acquired by IAC in 2002, and according to his own testimony, somewhere in the confusion, he lost track of some $28 million in options that subsequently expired and became worthless. Maffei appealed to Expedia C.E.O. Dara Khosrowshahi to reinstate the options, but Khosrowshahi refused. Diller testified at the trial that when Maffei asked Khosrowshahi to change the option dates of his agreement, Khosrowshahi told him, “I’m not going to jail for you.”

While to billionaires like Malone and Diller, the loss of $28 million might not mean much, it rankled Maffei. In Delaware, when Malone was asked whether Maffei had a grudge against Diller, Malone understatedly responded, “We knew that there had been a history.” Maffei would proceed to build on that history, spending the next few years slowly ratcheting up the pressure on Diller, who contends that Maffei openly criticized him with growing frequency.

Maffei’s public remarks led Diller to confront him during one of media banker Herb Allen’s Sun Valley, Idaho, retreats, accusing Maffei of acting a little “high school” and asking that they find a way to change the tone. He says that Maffei agreed. But Maffei only redoubled his efforts, inviting a Wall Street Journal reporter to accompany him in the fall of 2007 on the company jet from New York to Colorado, where the reporter met with Malone. That flight eventually led to a front-page hit job that Malone himself participated in but later disavowed.

It’s hard to believe that Malone didn’t see what was coming, especially considering the numerous zingers he offered up to the reporter. On ownership of IAC: “The hook is set. It is our company. Barry ain’t going to be able to spit the hook.” On Wall Street’s view of Diller: “There was a time when there was, I think, a 20 percent Barry premium. Today you could argue there is a Barry discount.” Last, Malone said, “It is a little uncomfortable for Barry. Right now we are the shadow that walks around behind him.”

When I tell Diller that I don’t quite believe his testimony that he was “hurt” by the Journal article, he doesn’t pause for a second. “You’re wrong,” he says. “I was. But I wasn’t hurt by Greg Maffei. Greg Maffei can’t hurt me. But John Malone, with whom I have had a very long relationship? What he did absolutely hurt me.” Diller nevertheless hopes to patch things up with Malone. “Malone was the only credible witness they had,” he says.

While the trial itself was mind-numbing at times, the subtext was riveting: John Malone, slayer of moguls, was looking to destroy the reputation of a man whose myth he had helped create. News coverage of the trial failed to adequately convey this aspect, given the dailies’ need to cover the incremental developments.

The gist of the dispute is this: Diller decided that in the process of splitting IAC into five pieces, he would also strip Liberty of its supervoting rights in four of IAC’s five companies. Liberty owns some 30 percent of IAC’s stock but 62 percent of the votes through its ownership of supervoting shares.

In 1995, Diller made it clear that his motives in joining forces with Malone were to be his own boss and to have a serious piece of the action. The two men agreed that Diller would vote Liberty’s stake in the company through a proxy agreement. But Diller soon found himself in the very situation he’d hoped to avoid. Major shareholders blocked his efforts to buy NBC and then nearly derailed his purchase of Expedia.

As a result, Diller told Malone that unless he could shake off the restrictions, he was out. Malone acquiesced. The question in Delaware was whether Diller had the right to split his own company if he desired. Judge Stephen Lamb decided that he did.

Diller says he had no choice but to bring things to a head. “Because of that article, I thought, one, that we would never be able to make a deal with them, and, two, that I didn’t want to negotiate with them anyway. That was personal. They were really out for the throat of the company.”

During the trial, Maffei seemed to enjoy his moment in the spotlight, smiling and laughing with Liberty’s lawyers during breaks. It helped that he was paid $19.2 million for his efforts in 2007—more than triple his 2006 pay of $5.7 million. Malone, whose natural expression seems almost a scowl, showed practically no emotion, while his neatly combed hair suggested a boy on his way to Sunday school. Diller was confidence incarnate in a blue pinstripe suit. It’s an amazing thing to see charisma on display: Malone, who has almost none, barely attracted a sidelong glance from the gallery. But when Diller walked into the room, it seemed for an instant that no one could look away.

Almost from the start, Maffei and Malone sought to make the trial a referendum on the performance of IAC’s stock and Diller’s pay, even though neither issue was legally relevant. When I asked Maffei about the motivation for Liberty’s lawsuit, he stuck to the company line: “First and foremost, this isn’t about the performance of IAC, or stock performance, or vanity buildings, or anything else like that. This is about the fact that Barry Diller sued us and made a proposal where he would steal our votes.”

Since taking the helm of IAC in 1995, Diller has pulled down $1.1 billion for his efforts. Virtually all of that money came from a few early option grants approved by Malone himself.

Diller is tired of answering questions about his pay but insists that he is not defensive about it. “Look, when you’re dealing with amounts of money this large, none of it is justifiable,” he says. “There is no moral right to any of this. But I earned this money over 10-plus years, not in one single year. And while it’s a genuine waste of time for me to try and explain this yet again, I want you to imagine that you’re a shareholder and you could go back 14 years, when you’re talking about a company that was technically bankrupt, a company that had lost $70 million the previous year. Would you have any problem granting me those options if you knew that 14 years later, even in a depressed market, that company would be worth $13 billion? What would your vote be?”

When I ask Diller how he feels about being called a relic of Web 1.0, he laughs. “I don’t pay too much attention to moments in time. I’ve had too many of them.” He goes on to say that if being labeled Web 1.0 means he owns a handful of internet properties that actually generate revenue and profit, then he’s guilty.

“That’s true of some of our businesses,” he says. “But thank God for that, because they produce the revenue that lets us innovate and create brand-new businesses.” He points to his firm’s initiatives in the online gaming space as an example. GarageGames.com is a site for developers of online games, and InstantAction.com is where those games will live. “That’s $50 million we’ve laid on the table on an idea,” Diller says.

Yet with only a handful of companies to work with, it is unlikely that his greatest skill—using highly complex deals to shift money around—will be of much use. Consider one of his new properties: FiLife.com, a financial site that’s a joint venture with Dow Jones. FiLife—which hired Dave Kansas, a former editor for TheStreet.com and the Wall Street Journal, to great fanfare—seems like it may be a dead man walking. Staffers are bailing, and word is that the site may never enjoy an official launch.

Of course, Diller will continue to experiment with public shareholders’ money, critics be damned. IAC president of programming Michael Jackson, who has worked with Diller on and off for the better part of a decade, says this of the company’s media strategy: “Barry says, ‘We all know there’s something going on here. We don’t quite know what we’re going to do, but we will start, put one foot in front of the other, and find our way. Not everything is going to succeed. Unless you’re out punting, though, you can’t really know what the audience will engage in.’ ”

Diller’s ultimate challenge is to guide IAC to a place where it’s once more earning the respect of the stock market, bringing the reputation of the company and the man in sync. For a minute there, during the panel discussion at the Four Seasons, the world was privy to that rarest of moments: Barry Diller gave us a glimpse of vulnerability. Don’t expect to see that again anytime soon.

Malone on the Ropes?

Looking back on the Battle of the Moguls in Delaware Chancery Court, Liberty Media may have failed to make its case.
Karen Donovan

John Malone and Barry Diller did not disappoint as they played out a soap opera of sorts in Delaware Chancery Court last week.

Their lawyers were at work on final briefs due today at the chambers of Vice Chancellor Stephen Lamb. He has asked for information on two matters:

Did Diller violate his contract with Malone's Liberty Media in his plan to spin off four IAC/Interactive business units into separate companies?

And was Liberty too hasty in suing, given that the board at Diller's IAC has not yet voted on the spinoffs?

At a hearing last Friday, Lamb said he would rule on the contract claims by March 28.

IAC Share Price

It's a fair bet that Liberty Media will have an uphill battle in winning the judge on the claims: For all the star power of Diller and Malone offering their own versions of the disintegration of their business marriage, the case may come down to how their lawyers interpreted a single clause in the governance agreement for their arrangement.

The two moguls, who have worked together for 13 years, each had a star turn at the trial.

Malone, appearing icy and aloof, called Diller's spinoff plan—which would, coincidentally, dilute Liberty Media's voting stake in the various businesses from about 62 percent to 30 percent—a "breach of faith" under a proxy agreement. (That agreement, by the way, does explicitly allow Diller to vote the Liberty Media shares—even against Liberty's own best interest, apparently.)

For his part, Diller, as method actor, "projected" during his time on the stand, at one point recounting an icy meeting with his fellow mogul after the Wall Street Journal published a front-page story in which Malone criticized Diller at great length.

But how did each executive score on the key contract point: What kind of latitude does Diller have to vote Liberty Media's shares in IAC after Liberty gave him its proxy?

Since 1995, Liberty Media has had a veto right over Diller's voting proxy on certain matters. Diller and his legal team from Wachtell, Lipton, Rosen & Katz have portrayed this provision as bowing to Liberty's concerns about Federal Communications Commission rules against cross-ownership of broadcasters.

Liberty, on the other hand, has characterized the veto power much more broadly.

The case could come down to a "he said/she said" match between two key lawyers for Liberty Media and IAC over how the veto provision has evolved over the years. It was last revised in 2001, when IAC merged the USA Network with Vivendi Universal.

Testimony from the lawyers who negotiated that deal differed on what kind of veto power Liberty Media retained.

Frederick "Buzz" McGrath, a partner with the New York office of Baker & Botts, who has represented Malone since 1992, testified that the veto clause was a "catchall protection" for Liberty.

But he could not provide evidence to support that recollection when pressed by Lamb.

"Is there anything in the writing from 1995 that confirms that testimony?" the judge asked.

"No, I don't believe so," McGrath responded.

"Did you communicate it to anyone at Wachtell, Lipton in 1995?" the judge then asked, referring to the law firm representing Diller's IAC.

"Not that I recall," McGrath replied. In fact, McGrath repeatedly admitted that there was no written communication confirming the catchall nature of Liberty's right to veto Diller's proxy.

The Diller response to Liberty is that the veto related only to "regulatory" matters, fundamentally the Federal Communications Commission's cross-ownership restrictions.

On this point, Liberty's lawyer, Pamela Seymon of Wachtell, was quite forceful. She testified that "alarm bells would have gone off in my head" had the "contingent matters" provision been a catchall in the 2001 negotiations.

Seymon also agreed that it was "fair" to characterize the veto provision as one that related to regulatory matters. "It's my interpretation," she said.

On Diller's right to exercise the proxy to vote in favor of spinoffs with a single-tier voting structure, Seymon was clear: "As a contractual matter, he can," she testified. "Remember that there is a board of directors here as well."

Seymon has a point: The IAC board last considered the spinoff at a January 16 meeting. Diller gave a speech at the time and Martin Lipton of Wachtell explained the board's liability, or lack thereof, if they voted in favor of the plan. The board has yet to act.

Malone testified that he left the legal details to his lawyers, while Diller was adamant that a veto provision that would have given Liberty Media a catchall would have set off "alarm bells" for him because "a fundamental purpose" of the Vivendi transaction was to "remove the consent rights" that Liberty previously held.

Stay tuned.

Fire Destroys Buildings At Universal Studios In LA
Sue Zeidler

A fire roared through part of Universal Studios film and TV studio on Sunday, damaging well-known movie sets and a popular "King Kong" attraction before being brought largely under control after 12 hours, fire officials said.

Universal, one of the world's six major film studios, had to close its popular theme park for the day because of the fire but it did not interfere with Sunday's taping of the popular MTV Movie Awards at the adjacent Gibson Amphitheater.

About 500 firefighters from several Los Angeles-area fire departments battled the blaze, which caused no fatalities but injured nine firefighters and a deputy sheriff, said Los Angeles County Fire Inspector Ron Haralson.

By late afternoon he said the backlot fire was contained to a single structure -- the "King Kong" exhibit -- as firefighters used bulldozers to move burning videotapes and other flaming debris.

The blaze destroyed about five structures within a faux New York set used in various movies and television shows, including one sound stage. Also damaged was the "King Kong" attraction, an alley from "The Sting" and a set from "Back to the Future."

Sunday's fire burned some of the same back-lot areas destroyed by a blaze in 1990, which whipped through the New York Street and a set used for "Ben Hur." It took years to rebuild at an estimated cost of $50 million.

Universal is operated by NBC Universal Inc., which is 80 percent owned by General Electric Co and 20 percent by French communications and utility company Vivendi.

Universal said it would resume its normal business hours Monday at 10 a.m., when all rides and attractions, including the studio tour, would be operating.

The fire caused traffic jams for miles in all directions to the studio, where a building housing a video vault had been badly damaged and the vault itself was "compromised."

A Universal spokeswoman said about 40,000 to 50,000 videos had been damaged but the studios either had copies of those films or could easily copy them.

The contents of a second vault holding master copies of older and classic movies were salvaged.

"Nothing irreplaceable was lost," said Ron Meyer, Universal Studios' president and chief operating officer.

The studio said the full damage had not yet been assessed.

Los Angeles County Fire Inspector Darryl Jacobs said the blaze was first reported about 4:45 a.m. The cause was not immediately clear.

Firefighters encountered explosions from propane tanks and called in helicopters at one point to drop water.

Universal Studios is bounded by the city of Los Angeles and communities like Burbank. It is home to the Universal Pictures movie lot and Universal Studios Hollywood theme park.

Several acres on the 230-acre (93-hectare) back-lot area, where films and TV shows are produced, were burned but the theme park was largely unaffected.

Universal Studios Hollywood houses attractions such as "Revenge of the Mummy - The Ride" and "Shrek 4-D." Its "CityWalk" mall has 65 restaurants, nightclubs and shops.

Universal Pictures, with a history dating to 1909, has been a major producer of hit films, and tapped a young Steven Spielberg to make 1975's "Jaws." The director still houses his production company, Amblin Entertainment, on the lot.

Other hit Universal titles have included the "Back to the Future" and "Jurassic Park" movies.

Fire Tears Through Movie Lot in Los Angeles
Kevork Djansezian

One of Hollywood's largest movie studios starred in a disastrous sequel Sunday as a fire ripped through a lot at Universal Studios, destroying a set from ''Back to the Future,'' a King Kong exhibit and a streetscape seen frequently in movies and TV shows.

It was the second fire at the historic site in nearly two decades, leveling facades, hollowing out buildings and creating the kind of catastrophe filmmakers relish re-creating. This time around, thousands of videos chronicling Universal's movie and TV shows were destroyed in the blaze.

But Universal officials said that they were thankful no one was seriously injured at the theme park and that the damaged footage can be replaced.

''We have duplicates of everything,'' said NBC Universal President and Chief Operating Officer Ron Meyer. ''Nothing is lost forever.''

The blaze broke out on a sound stage featuring New York brownstone facades around 4:30 a.m. at the 400-acre property, Los Angeles County Fire Chief Michael Freeman said. The fire was contained to the lot, but about 400 firefighters were still trying to put it out several hours later.

The cause of the fire is under investigation. Damage was expected to be in the millions of dollars.

The iconic courthouse square from ''Back to the Future'' was destroyed, and the famous clock tower that enabled Michael J. Fox's character to travel through time was damaged, fire officials said. Two mock New York and New England streets used both for movie-making and as tourist displays were a total loss, Los Angeles County Fire Inspector Darryl Jacobs said.

An exhibit housing a mechanically animated King Kong that bellows at visitors on a tram also was destroyed.

All three sites were either damaged or destroyed during another fire at Universal Studios in November 1990. That fire caused $25 million in damage and was started by a security guard who was sentenced to four years in prison after pleading guilty to arson.

The park remained closed Sunday afternoon as hundreds of visitors waited outside the gates, where acrid smoke lingered. Fire officials didn't believe air quality would pose a health hazard to the public. On a typical weekend day, about 25,000 people visit Universal Studios.

Mike Herrick of San Diego watched the fire on television from his hotel before deciding to return to Universal Studios for a second day with his wife.

''By gosh, we're going to go and get whatever we can out of it,'' Herrick said. On Saturday, Herrick rode the tram that winds around the studio lot, snapping photos of the King Kong attraction, among other sights.

The fire broke out along New York Street, where firefighting helicopters swept in for drops and cranes dumped water on the flames. A thick column of smoke rose thousands of feet into the air and could be seen for miles.

''It looked like a disaster film,'' said Los Angeles City Councilman Tom LaBonge.

At one point the blaze was two city blocks wide, and low water pressure forced firefighters to get reserves from lakes and ponds on the property. Six firefighters suffered minor injuries.

''The water pressure situation was a challenge,'' Freeman said. ''This fire moved extremely fast.''

Meyer estimated there were 40,000 to 50,000 videos and reels in a video vault that burned but said duplicates were stored in a different location. Firefighters managed to recover hundreds of titles.

The videos included every film that Universal has produced and footage from television series including ''Miami Vice'' and ''I Love Lucy.''

Universal Studios, nine miles north of downtown Los Angeles, has thrill rides and a back lot where movies and television shows are filmed, including scenes from ''War of the Worlds,'' ''When Harry Met Sally'' and ''Scrubs.''

The fire will not affect the 2008 MTV Movie Awards, which is to broadcast live Sunday night from the Gibson Amphitheatre in the adjacent Universal CityWalk, according to the music network.

Universal Studios Fire Sparked by Blow Torch
Steve Gorman

A fire that burned through a large swath of the Universal Studios Hollywood back lot during the weekend was accidentally sparked by workers using heating tools on a film set, fire officials said on Monday.

The blaze erupted before dawn on Sunday in a portion of the lot containing exteriors used to resemble a New York City streetscape. It reduced a two-city-block area of the lot to ashes and burned through much of the adjacent Courthouse Square set that has appeared in such films as "Back to the Future" and "To Kill a Mockingbird."

Also destroyed was the popular "King Kong" attraction featured in the Universal Studios Theme Park tram tour of the back lot, and a warehouse where thousands of copies of archived TV shows and films were stored. Studio officials said all of the material lost in the video vault could be replaced.

More than 400 firefighters battled the flames late into the night. Nine firefighters and a deputy sheriff suffered minor injuries, Los Angeles County Fire Chief P. Michael Freeman said at a news conference.

He said an investigation revealed the fire was touched off by three members of a studio work crew who had been using a blow torch to apply asphalt shingles to the roof of a building facade.

They finished their work at about 3 a.m. and stood watch for an hour, according to company policy. Seeing no signs of a fire, they left the scene for a break, but a security guard in the vicinity noticed flames about 45 minutes later and called the fire department.

The fire, which burned for about 18 hours, forced authorities to close the theme park for the day, but the facility was reopened to tourists on Monday morning.

Much of the same area scorched by Sunday's blaze had been destroyed by a 1990 arson fire and was subsequently rebuilt.

Firefighters were hampered on Sunday by low water pressure at times, but Freeman said the difficulty seemed to result from the overwhelming water demands posed by the blaze. At the height of the fire, more than 18,000 gallons of water per minute were being poured into the flames, he said.

Only one current TV show, the CBS series "The Ghost Whisperer," was staged on the portion of the lot damaged by the fire. That series is on summer hiatus and not scheduled to resume production until June 11, a studio spokeswoman said.

She said no movie productions were affected by the blaze.

Universal is operated by NBC Universal Inc, which is 80 percent owned by General Electric Co.
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Bo Diddley, a Rock ’n’ Roll Pioneer, Is Dead at 79
Ben Ratliff

Bo Diddley, a singer and guitarist who invented his own name, his own guitars, his own beat and, with a handful of other musical pioneers, rock ’n’ roll itself, died Monday at his home in Archer, Fla. He was 79.The cause was heart failure, a spokeswoman, Susan Clary, said. Mr. Diddley had a heart attack last August, only months after suffering a stroke while touring in Iowa.In the 1950s, as a founder of rock ’n’ roll, Mr. Diddley — along with Chuck Berry, Little Richard, Jerry Lee Lewis and a few others — helped reshape the sound of popular music worldwide, building it on the templates of blues, Southern gospel, R&B and postwar black American vernacular culture.

His original style of rhythm and blues influenced generations of musicians. And his Bo Diddley syncopated beat — three strokes/rest/two strokes — became a stock rhythm of rock ’n’ roll.

It can be found in Buddy Holly’s “Not Fade Away,” Johnny Otis’s “Willie and the Hand Jive,” the Who’s “Magic Bus,” Bruce Springsteen’s “She’s the One” and U2’s “Desire,” among hundreds of other songs.

Yet the rhythm was only one element of his best records. In songs like “Bo Diddley,” “Who Do You Love,” “Mona,” “Crackin’ Up,” “Say, Man,” “Ride On Josephine” and “Road Runner,” his booming voice was loaded up with echo and his guitar work came with distortion and a novel bubbling tremelo. The songs were knowing, wisecracking and full of slang, mother wit and sexual cockiness. They were both playful and radical.

So were his live performances: trancelike ruckuses instigated by a large man with a strange-looking guitar. It was square and he designed it himself, long before custom guitar shapes became commonplace in rock.

Mr. Diddley was a wild performer, jumping, lurching, balancing on his toes and shaking his knees as he wrangled with his instrument, sometimes playing it above his head. Elvis Presley, it has long been supposed, borrowed from Mr. Diddley’s stage moves; Jimi Hendrix, too.

Still, for all his fame, Mr. Diddley felt that his standing as a father of rock ’n’ roll was never properly acknowledged. It frustrated him that he could never earn royalties from the songs of others who had borrowed his beat.

“I opened the door for a lot of people, and they just ran through and left me holding the knob,” he told The New York Times in 2003.

He was a hero to those who had learned from him, including the Rolling Stones and the Beatles. A generation later, he became a model of originality to bands like the Clash and the Fall.

In 1979 Joe Strummer and Paul Simonon of the Clash asked that Mr. Diddley open for them on the band’s first American tour. “I can’t look at him without my mouth falling open,” Mr. Strummer, starstruck, told a journalist during the tour.

For his part Mr. Diddley had no misgivings about facing a skeptical audience. “You cannot say what people are gonna like or not gonna like,” he explained later to the biographer George R. White. “You have to stick it out there and find out! If they taste it, and they like the way it tastes, you can bet they’ll eat some of it!”

Mr. Diddley was born Otha Ellas Bates in McComb, Miss., a small city about 15 miles from the Louisiana border. He was reared primarily by his mother’s first cousin, Gussie McDaniel, who had three children of her own. After the death of her husband, Ms. McDaniel took the family to Chicago, where young Otha’s name was changed to Ellas B. McDaniel. Gussie McDaniel became his legal guardian and sent him to school.

He was 6 when the family resettled on Chicago’s South Side. He described his youth as one of school, church, trouble with street toughs and playing the violin for both band and orchestra, under the tutelage of O. W. Frederick, a prominent music teacher at Ebenezer Baptist Church. Gussie McDaniel taught Sunday school there. Ellas studied classical violin from the age of 7 to 15 and started on guitar at 12, when his sister gave him an acoustic model.

He then enrolled at Foster Vocational School, where he built a guitar as well as a violin and an upright bass. But he dropped out before graduating. Instead, with guitar in hand, he began performing in a duo with his friend Roosevelt Jackson, who played the washtub bass. The group became a trio when they added another guitarist, Joseph Leon (Jody) Williams, then a quartet when they added a harmonica player, Billy Boy Arnold.

The band, first called the Hipsters and then the Langley Avenue Jive Cats, started playing at an open-air market on Maxwell Street. They were sometimes joined by another friend, Samuel Daniel, who was known as Sandman because of the shuffling rhythms he made with his feet on a wooden board sprinkled with sand.

Playing with the Jive Cats was not enough to make a living in the early days, so Mr. Diddley found jobs where he could: at a grocery store, a picture-frame factory, a blacktop company. He worked as an elevator operator and a meat packer. He also started boxing, hoping to turn professional.

In 1954 Mr. Diddley made a demonstration recording with his band, which now included Jerome Green on maracas. Phil and Leonard Chess of Chess Records liked the demo, especially Mr. Diddley’s tremelo on the guitar, a sound that seemed to slosh around like water. They saw it as a promising novelty and encouraged the group to return.

By Billy Boy Arnold’s account, the next day, as the band and their soon-to-be producers were setting up for a rehearsal, they were idly casting about for a stage name for Ellas McDaniel when Mr. Arnold thought of Bo Diddley. The name described a “bow-legged guy, a comical-looking guy,” Mr. Arnold said, as quoted by Mr. White in his 1995 biography, “Bo Diddley: Living Legend.”

That may be all there is to tell about the name, except for the fact that a certain one-string guitar — native to the Mississippi Delta, often homemade, in which a length of wire is stretched between two nails in a door — is called a diddley bow. By his account, however, Mr. Diddley had never played one.

In any case, Otha Ellas McDaniel had a new name and the title of a new song, whose lyrics began, “Bo Diddley bought his babe a diamond ring.” “Bo Diddley” became the A side of his first single, in 1955, on the Checker label, a subsidiary of Chess. It reached No. 2 on the Billboard chart.

Mr. Diddley said he had first heard the “Bo Diddley beat” — bomp ba-bomp bomp, bomp bomp — in a church in Chicago. But variations of it were in the air. The children’s game hambone used a similar rhythm, and so did the ditty “Shave and a haircut, two bits.”

The beat is also related to the Afro-Cuban clave, which had been popularized at the time by the New Orleans mambo carnival song “Jockomo,” recorded by Sugar Boy Crawford in 1953.

Whatever the source, Mr. Diddley felt the beat’s power. In early songs like “Pretty Thing” and “Bo Diddley,” he arranged the rhythm for tom-toms, guitar, maracas and voice, with no cymbals and no bass. (Also arranged in his signature rhythm was the eerie “Mona,” a song of praise he wrote for a 45-year-old exotic dancer who worked at the Flame Show Bar in Detroit; this song became the template for Buddy Holly’s “Not Fade Away.”)

Appearing on “The Ed Sullivan Show” in 1955, Mr. Diddley was asked to play Tennessee Ernie Ford’s “Sixteen Tons.” Without telling Mr. Sullivan, he played “Bo Diddley” instead. Afterward, in an off-camera confrontation, Mr. Sullivan told him that he would never work in television again. Mr. Diddley did not play again on a network show for 10 years.

For decades Mr. Diddley was bitter about his relationship with the Chess family, whom he accused of withholding money owed to him. In her book “Spinning Blues Into Gold,” Nadine Cohodas quoted Marshall Chess as saying, “What’s missing from Bo’s version of events is all the gimmes.” Mr. Diddley would borrow so heavily against projected royalties, Mr. Chess said, that not much was left over in the final accounting.

Mr. Diddley’s watery tremolo effect, from 1955 onward, came from one of the first effects boxes to be manufactured for guitars: the DeArmond Model 60 Tremelo Control. But Mr. Diddley contended that he had already built something similar himself, with automobile parts and an alarm-clock spring.

His first trademark guitar was also handmade: he took the neck and the circuitry off a Gretsch guitar and connected it to a square body he had built. In 1958 he asked Gretsch to make him a better one to the same specifications. Gretsch made it as a limited-edition guitar called “Big B.”

On songs like “Who Do You Love,” his guitar style — bright chicken-scratch rhythm patterns on a few strings at a time — was an extension of his early violin playing, he said.

“My technique comes from bowing the violin, that fast wrist action,” he told George White, explaining that his fingers were too big to move around easily. Rather than fingering the fretboard, Mr. Diddley said, he tuned the guitar to an open E and moved a single finger up and down to create chords.

As his fame rose, his personal life grew complicated. His first marriage, at the age of 18, to Louise Woolingham, lasted less than a year. His second marriage, in 1949, to Ethel Smith, unraveled in the late 1950s. He then moved from Chicago to Washington, settling in the Mount Pleasant district, where he built a studio in his home.

Separated from his wife, he was performing in Birmingham, Ala., when, backstage, he met a young door-to-door magazine saleswoman named Kay Reynolds, a fan, who was 15 and white. They moved in together in short order and were soon married, in spite of Southern taboos against racial intermarriage.

During the late 1950s, Mr. Diddley’s band featured a female guitarist, Peggy Jones (stage-named Lady Bo), at a time when there were scarcely any women in rock. She was replaced by Norma Jean Wofford, whom Mr. Diddley called the Duchess. He pretended she was his sister, he said, to be in a better position to protect her on the road.

The early 1960s were low times. Chess, searching for a hit, had Mr. Diddley make albums to capitalize on the dance craze the twist, as Chubby Checker had done, and on the surf music of the Beach Boys. But soon a foreign market for his earlier music began to grow, thanks in large part to the Rolling Stones, a newly popular band that was regularly playing at least seven of his songs in its concerts. It paved the way for Mr. Diddley’s successful tour of Britain in the fall of 1963, performing with the Everly Brothers, Little Richard and the Rolling Stones, the opening act.

But Mr. Diddley was not willing to move to Europe, and in America the picture worsened for him: the Beatles, the Stones, Bob Dylan and the Byrds quickly made Bo Diddley sound quaint. When work all but dried up, he moved to New Mexico in the early 1970s and became a deputy sheriff in the town of Los Lunas. With his sound updated to resemble hard rock and soul, he continued to make albums for Chess until his contract expired in 1974. His recording career never picked up after that, despite flirtations with synthesizers, religious rock and hip-hop. But he continued apace as a performer and public figure, popping up in places both obvious, like rock ’n’ roll nostalgia revues, and not so obvious: a Nike advertisement, the film “Trading Places” with Eddie Murphy, the 1979 tour with the Clash, and two presidential inaugurals, George H. W. Bush’s and Bill Clinton’s.

His last recording was the 1996 album “A Man Amongst Men” (Code Blue/Atlantic), which was nominated for a Grammy. He was inducted into the Rock and Roll Hall of Fame in 1986 and in 1998 was inducted into the National Academy of Recording Arts and Sciences Hall of Fame as a musician of lasting historical importance.

Since the early ’80s, Mr. Diddley lived in Archer, Fla., near Gainesville, where he owned 76 acres and a recording studio. His passions were fishing and old cars, including a 1969 purple Cadillac hearse.

Mr. Diddley was married four times, most recently, in 1992, to Sylvia Paiz; his spokeswoman, Ms. Clary, said they were no longer married. His survivors include his children, Evelyn Kelly, Ellas A. McDaniel, Tammi D. McDaniel and Terri Lynn McDaniel; and 15 grandchildren, 15 great-grandchildren and three great-great-grandchildren.

Mr. Diddley attributed his longevity to abstinence from drugs and drinking, but in recent years he had suffered from diabetes. After a concert in Council Bluffs, Iowa, on May 13, 2007, he had a stroke and was taken to Creighton University Medical Center in Omaha. Last Aug. 28 he suffered a heart attack in Gainesville and was hospitalized.

Mr. Diddley always believed that he and Chuck Berry had started rock ’n’ roll, and the fact that he couldn’t financially reap all that he had sowed made him a deeply suspicious man.

“I tell musicians, ‘Don’t trust nobody but your mama,’ ” he said in an interview with Rolling Stone magazine in 2005. “And even then, look at her real good.”

Alton Kelley, Poster Designer, Is Dead
William Grimes

Alton Kelley, whose psychedelic concert posters for artists like the Grateful Dead, Jimi Hendrix, and Big Brother and the Holding Company helped define the visual style of the 1960s counterculture, died on Sunday at his home in Petaluma, Calif. He was 67.
The cause was complications of osteoporosis, said his wife, Marguerite Trousdale Kelley.

Mr. Kelley and his longtime collaborator, Stanley Mouse, combined sinuous Art Nouveau lettering and outré images plucked from sources near and far to create the visual equivalent of an acid trip. A 19th-century engraving from “The Rubaiyat of Omar Khayyam” inspired a famous poster for a Grateful Dead concert at the Avalon Ballroom in 1966 that showed a skeleton wearing a garland of roses on its skull and holding a wreath of roses on its left arm.

The Grateful Dead later adopted this image as its emblem. Mr. Kelley and Mr. Mouse also designed several of the group’s album covers, including “American Beauty” and “Workingman’s Dead.”

Mr. Kelley was born in Houlton, Me., and grew up in Connecticut, where his parents moved to work in defense plants during World War II. His mother, a former schoolteacher, encouraged him to study art, and for a time he attended art schools in Philadelphia and New York, but his real passion was racing motorcycles and hot rods. He applied his artistic training to painting pinstripes on motorcycle gas tanks.

After working as a welder at the Sikorsky helicopter plant in Stratford, Conn., he moved to San Francisco in 1964, settling into the Haight-Ashbury neighborhood. With a group of friends he helped stage concerts at the Red Dog Saloon in Virginia City, Nev., by the Charlatans, a electric folk-rock band. On returning to San Francisco, he became a founding member of the Family Dog, a loose confederation of artists, poets, musicians and other free spirits who put on the some of the earliest psychedelic dance concerts, first at the Longshoremen’s Hall and later at the Avalon Ballroom.

Mr. Kelley was in charge of promoting the concerts with posters and flyers, but his drafting ability was weak. That shortcoming became less of a problem in early 1966, when he teamed up with Stanley Miller, a hot-rod artist from Detroit who worked under the last name Mouse. The two formed Mouse Studios, with Mr. Kelley contributing layout and images and Mr. Mouse doing the distinctive lettering and drafting work. Often, they took trips to the public library in a search for images from books, magazines and photographs.

“Stanley and I had no idea what we were doing,” Mr. Kelley told The San Francisco Chronicle last year. “But we went ahead and looked at American Indian stuff, Chinese stuff, Art Nouveau, Art Déco, Modern, Bauhaus, whatever.”

One of their first posters, for a concert headlined by Big Brother and the Holding Company, reproduced the logo for Zig-Zag cigarette papers, used widely for rolling marijuana joints.

“We were paranoid that the police would bust us or that Zig-Zag would bust us,” Mr. Mouse said.

From 1966 to 1969, Mr. Kelley worked on more than 150 posters for concerts at the Avalon Ballroom and the Fillmore, publicizing the most famous bands and artists of the era, among them Quicksilver Messenger Service, the Butterfield Blues Band and Moby Grape, as well as the Dead, Big Brother and the Holding Company, Jimi Hendrix, and Country Joe and the Fish. They created three posters for concerts headlined by Bo Diddley, who died on Monday.

With time, Mr. Kelley’s drawing improved, and the partners virtually fused into a poster-generating unit.

“Kelley would work on the left side of the drawing table and Mouse on the Right,” said Paul Grushkin, the author of “The Art of Rock: Posters From Presley to Punk” and a longtime friend of both men. “They turned out a poster a week.”

At the time, the posters were put up on telephone poles. Everyone who attended a concert at the Avalon received a free poster advertising the next show on the way out the door. Some were sold in head shops for a few dollars. Today, mint-condition posters by Mr. Kelley and Mr. Mouse can command prices of $5,000 or more.

With the waning of the 1960s, Mr. Kelley and Mr. Mouse diversified. They formed Monster, a T-shirt company, in the mid-1970s. They also designed the Pegasus-image cover for the Steve Miller album “Book of Dreams” and several albums for Journey in the 1980s.

In their final collaboration, in March of this year, they contributed the cover art for the program at the induction ceremony at the Rock and Roll Hall of Fame. On his own, Mr. Kelley designed posters and created hot-rod paintings that he transferred to T-shirts.

In addition to his wife, Mr. Kelley is survived by three children, Patty Kelley of San Diego, Yossarian Kelley of Seattle and China Bacosa of Herald, Calif.; two grandchildren; and his mother, Annie Kelley, and a sister, Kathy Verespy, both of Trumbull, Conn.

“Kelley had the unique ability to translate the music being played into these amazing images that captured the spirit of who we were and what the music was all about,” said the Grateful Dead drummer Mickey Hart. “He was a visual alchemist — skulls and roses, skeletons in full flight, cryptic alphabets, nothing was too strange for his imagination to conjure.”

Yves Saint Laurent, Fashion Icon, Dies at 71
Anne-Marie Schiro

Yves Saint Laurent, who exploded on the fashion scene in 1958 as the boy-wonder successor to Christian Dior and endured as one of the best-known and most influential couturiers of the second half of the 20th century, died on Sunday in Paris. He was 71.

The announcement was made by the Pierre-Berge-Saint Laurent Foundation, but the cause of death was not immediately released.

During a career that ran from 1957 to 2002, he was largely responsible for changing the way modern women dress, putting them into pants both day and night, into peacoats and safari jackets, into “le smoking” (as the French call a man’s tuxedo jacket), and into leopard prints, trench coats and, for a time in the 1970’s, peasant-inspired clothing in rich fabrics.

Mr. Saint Laurent often sought inspiration on the streets, bringing the Parisian beatnik style to couture runways and adapting the sailors’ peacoats he found in Army-Navy stores in New York into jackets that found their way into fashionable women’s wardrobes around the world. His glamorous evening clothes were often adorned with appliqués and beadwork inspired by artists like Picasso, Miró and Matisse. .

Among the women of style who wore his clothes were Catherine Deneuve, Paloma Picasso, Nan Kempner, Lauren Bacall, Marella Agnelli and Marie-Hélčne de Rothschild.

Mr. Saint Laurent achieved instant fame in 1958 at the age of 21 when he showed his Trapeze collection, his first for Christian Dior following the master’s death. But unlike many overnight sensations, Mr. Saint Laurent managed to remain at the top of his profession as fashion changed, from an emphasis on formal, custom-made haute couture to casual sportswear.

For many years after he opened his own couture house in 1962, his collections were eagerly anticipated by fashion enthusiasts, who considered his the final word on that season’s style. His influence was at its height during the 1960’s and 70’s when it was still normal for couturiers to change silhouettes and hemlines drastically every six months.

Among his greatest successes were his Mondrian collection in 1965, based on the Dutch artist’s linear paintings, and the “rich peasant” collection of 1976, which stirred so much interest that the Paris show was restaged in New York for his American admirers. “The clothes incorporated all my dreams,” he said after the show, “all my heroines in the novels, the operas, the paintings. It was my heart — everything I love that I gave to this collection.”

Originally a maverick and a generator of controversy — in 1968, his suggestion that women wear pants as an everyday uniform was considered revolutionary — Mr. Saint Laurent developed into a more conservative designer, a believer in evolution rather than revolution. He often said that all a woman needed to be fashionable was a pair of pants, a sweater and a raincoat.

“My small job as a couturier,” he once said, “is to make clothes that reflect our times. I’m convinced women want to wear pants.”

By 1983, when he was 47, his work was recognized by fashion scholars as so fundamentally important to women’s dress that a retrospective of his designs was held at the Costume Institute of the Metropolitan Museum of Art, the first time the museum had honored a living designer. Diana Vreeland, the legendary magazine editor and the doyenne of the Costume Institute, who masterminded the exhibition, called him “a living genius” and “the Pied Piper of fashion.”

“Whatever he does,” she said, “women of all ages, from all over the world, follow.” That exhibition was followed by retrospectives in Paris, Beijing, Moscow, St. Petersburg, Tokyo and Sydney, Australia.

But the New York exhibition could be considered the apotheosis of Mr. Saint Laurent’s career, for after that he settled into a classical mode of reinterpreting his earlier successes. The boy wonder had turned into the elder statesman. He said in an interview in 1983: “A woman’s wardrobe shouldn’t change every six months. You should be able to use the pieces you already own and add to them. Because they are like timeless classics.”

Yet because so many of his early designs seeped into the public domain of fashion (and into many other designers’ collections), he managed to retain his stellar position in the world of fashion through his retirement in 2002.

Yves Henri Donat Mathieu-Saint-Laurent came a long way from Oran, Algeria, where he was born on Aug. 1, 1936, to Charles and Lucienne Andrée Mathieu-Saint-Laurent. His father was a lawyer and insurance broker, his mother a woman of great personal style. He grew up in a villa by the Mediterranean with his two younger sisters, Michelle and Brigitte.

Young Yves was said to be a quiet and retiring child (and as an adult was often described as quiet and retiring), who avoided all sports but swimming and developed a love for fashion and the theater at an early age. After seeing a production of Moličre’s “School for Scandal” when he was 11, he recreated the play in miniature, pasting the costumes together. As a teen-ager, he designed clothes for his mother, who had them whipped up by a local seamstress. (His mother became his greatest fan, sitting in the front row at all his shows and wearing no one else’s designs.)

Although his parents wanted him to study law, Mr. Saint Laurent — lanky and brown-haired, his blue eyes framed by glasses — went to Paris when he was 17 to try his luck in theatrical and fashion design. He briefly studied design at the Chambre Syndicale de la Couture, leaving because he said he was bored. Shortly thereafter, he won first prize in an International Wool Secretariat design competition for his sketch of a cocktail dress. This led to an interview with Christian Dior, who noted an uncanny resemblance between Mr. Saint Laurent’s cocktail dress and one he himself was working on. Recognizing the young designer’s talent, Dior hired him on the spot as his assistant.

For three years, Mr. Saint Laurent worked closely with Dior, who called him “my dauphin” and “my right arm.” After Dior died suddenly in 1957, shocking the fashion world, the House of Dior named Mr. Saint Laurent its head designer. At 21, he found himself at the head of a $20-million-a-year fashion empire, succeeding a legend, the man who had radically changed the way women dressed in 1947 with the wasp-waisted New Look.

Mr. Saint Laurent’s first collection in his new position, shown on Jan. 30, 1958, was based on the trapeze, a youthful silhouette that started with narrow shoulders and a raised waistline, then flared out gently to a wide hemline. The collection was received with great enthusiasm, and Mr. Saint Laurent’s name was well on its way to becoming a household word across Europe and America.

He was credited by many with rejuvenating French fashion and securing his country’s pre-eminent position in the world of haute couture. Newsboys shouted his triumph across the streets of Paris while he waved to the crowds below the balcony of the House of Dior on the Avenue Montaigne. The dauphin was crowned king.

His last collection for Dior, in July 1960, was based on a “chic beatnik” look of knitted turtlenecks and black leather jackets. It was less warmly received, though eventually the style became the uniform of the avant-garde.

In September of that year, Mr. Saint Laurent was called up for 27 months of compulsory military service during the war France was then fighting in Algeria. He had previously been given deferments because 2,000 jobs depended on his talent.

About three weeks after his induction, he was hospitalized for a nervous collapse. In October 1960, the House of Dior gave his job to Marc Bohan, his former assistant. In November, Mr. Saint Laurent was discharged from the army and entered a private clinic near Paris. In later years, he suffered from depression and a dependency on alcohol and drugs, a dependency he attributed to the drugs he was given in a military psychiatric hospital. But he almost always recovered in time to take the ritual walk down the runway, however unsteadily, at the finale of his shows.

In January 1961, Marc Bohan’s collection for Dior was a huge success. Mr. Saint Laurent sued Dior for severance pay and damages after the house refused to reinstate him after his army discharge. He was awarded 680,000 francs by the court, then about $140,000.

In September 1961, Mr. Saint Laurent announced plans to open his own haute couture house in partnership with his lover, Pierre Bergé. Mr. Bergé remained his lifelong business partner and was responsible for the company’s financial success, although they split up as a couple in the early 1980’s. The fledgling house was backed by J. Mack Robinson, an Atlanta businessman, who later said his confidence was based on the excitement Mr. Saint Laurent created when he replaced Dior.

The first Yves Saint Laurent collection was shown on Jan. 19, 1962. It was the beginning of a success story that led eventually to a ready-to-wear line sold in the designer’s own Rive Gauche boutiques around the world; to 500 licenses for scarves, jewelry, furs, shoes, men’s wear, cosmetics and perfumes, and even cigarettes; to set and costume designs for the ballet, theater and movies (most notably, for Catherine Deneuve in “Belle de Jour” in 1967); to a listing on the Paris Bourse, and to a host of awards, including the French Legion of Honor in 1985.

The House of Saint Laurent was acquired by various owners over the years, including Lanvin-Charles of the Ritz and Squibb-Beach Nut. In 1993, in a $636 million transaction, it became part of the state-owned French pharmaceuticals conglomerate Elf Sanofi, but 43 percent of the fashion group remained in the hands of Mr. Bergé and Mr. Saint Laurent, who were to retain control of the couture section of the business until the year 2001. His ready-to-wear and fragrance collections had been acquired by Gucci Group, the luxury conglomerate, the year before, and had since been designed — to Mr. Saint Laurent’s vocal displeasure — by the American fashion star Tom Ford.

“The poor guy does what he can,” Mr. Saint Laurent said of his successor.

Mr. Ford, who simultaneously designed the Gucci and Yves Saint Laurent collections with an overtly racy and sexualized aesthetic during those years, left the company in 2003; the Yves Saint Laurent collections have since been designed by one of his former assistants, Stefano Pilati.

In January 2002, Mr. Saint Laurent announced his retirement in Paris at a press conference at his couture house at 5, avenue Marceau, where many fashion editors and teary-eyed friends of the house considered the possibility that Mr. Saint Laurent had felt pressured to resign. He and Mr. Bergé denied that, and a week later announced plans to turn the house into a museum, which has since displayed exhibitions of Mr. Saint Laurent’s smoking jackets and the clothes he designed for Ms. Kempner.

The designer, of course, managed several times to create controversy during his career with, of all things, his fragrances. In 1971, he appeared nude in an advertisement for his men’s cologne YSL. Then, in 1977, he named one of his women’s perfumes Opium, which led to charges that he was glamorizing drug use and trivializing the 19th-century Opium Wars in China. Its slogan was “Opium, for those who are addicted to Yves Saint Laurent.” In 1992, his plans to call another perfume Champagne prompted a lawsuit by French wine makers (the Saint Laurent company lost).

In another legal battle, Mr. Saint Laurent won a 1994 suit in the French courts against Ralph Lauren, whom he accused of copying the design for his tuxedo dress (a style Mr. Saint Laurent reinterpreted many times over the years).

In 1992, a celebration at the Bastille Opera in Paris of the 30th anniversary of the House of Saint Laurent was attended by 2,750 admirers who applauded as 100 models took to the stage in clothes from the three decades. Writing about the event in The New York Times, Bernadine Morris said, “What was wondrous about these clothes, besides their breathtaking beauty, was that nothing looked dated.”

As befitted his success, Mr. Saint Laurent lived elegantly. All his homes — which he shared with a succession of French bulldogs, always named Moujik — were lavishly decorated and filled with antiques and artwork by his favorite artists, who included Picasso, Cocteau, Braque and Christian Bérard. He often said that Bérard was one of the greatest influences on his designs, particularly in the use of color.

“Every man needs aesthetic phantoms in order to exist,” Mr. Saint Laurent said at the announcement of his retirement. “I have known fear and the terrors of solitude. I have known those fair-weather friends we call tranquilizers and drugs. I have known the prison of depression and the confinement of hospital. But one day, I was able to come through all of that, dazzled yet sober.”

‘Sex and the City’ Leads Weekend Box Office
Michael Cieply and Bill Carter

“Sex and the City” and its legion of female fans over the weekend gave Hollywood exactly what it needs to survive an uncertain summer movie season: an unconventional hit.

The romantic comedy, based on HBO’s long-running television series of the same name, unexpectedly overtook the latest “Indiana Jones” movie at the domestic box office, bringing in an estimated $55.7 million since opening with midnight shows on Thursday, according to Warner Brothers., which released the film.

The performance fell short of the $70 million-plus opening some foresaw after sellout crowds — 85 percent of the ticket buyers women, many viewing in groups — brought the film about $26 million in sales on Friday. Still, the weekend opening far exceeded industry expectations, which only a week ago were looking something closer to the $27.5 million taken in by “The Devil Wears Prada,” a similarly female-driven hit released by 20th Century Fox in June of 2006.

“It is kind of mind-boggling,” Sarah Jessica Parker, the “Sex and the City” star, said in a telephone interview from her Manhattan home on Saturday. “We are thrilled and humbled that the audience came out.”

“Sex and the City,” of course, benefited from the enormous audience awareness that came with the television series’s six seasons, strong DVD sales and continuing appearances in syndication on TBS. There was also no shortage of media attention showered on the return after four years of Carrie, Miranda, Samantha and Charlotte, whether features about their clothes, their men or the show’s enduring influence (for good or ill) on the culture.

And yet surprise at the weekend performance was palpable, even among those who made the $65 million film. Ms. Parker, for instance, said she did not intend to sit home this weekend monitoring the box office results. But by late Friday, fans were sending messages and even photographs to her cellphone of women in line outside movie theaters across the country. (As the weekend went on, more men showed up, according to Warner Brothers.) A clutch of negative reviews did nothing to dampen the thirst for making a night or day of it at the theater.

“It’s a cultural phenomenon; it’s an absolutely incredible opening,” said Dan Fellman, Warner’s president for theatrical distribution, speaking by phone on Sunday. First-weekend ticket sales, he noted, were far beyond those of other R-rated comedies, including “American Pie 2” from Universal Pictures in 2001 and “The Wedding Crashers” from New Line Cinema in 2005.

The weekend opening also ranked as the strongest ever for a movie carried by a female lead (at least if ticket-price inflation is not taken into account). Paramount’s “Lara Croft: Tomb Raider” was the previous record-holder, with $47.7 million in ticket sales for Paramount during its opener in 2001.

“I am so excited about the possibilities for movies about women,” Ms. Parker said.

Ms. Parker credited Michael Patrick King, the movie’s writer and director, with creating an update of the hit HBO television show that brought the characters forward. “It’s a movie about being a grown-up,” she said.

Grown-up women have never exactly been absent from the big screen. Women’s roles have been as complex and varied as Helen Mirren’s turn as Queen Elizabeth II, which won her an Oscar in 2007, and Meryl Streep’s performance as the semi-monstrous fashion magazine editor in “Prada,” which turned into a box office smash.

But the female audience has seldom showed its potential in the way it did this weekend.

As “Sex and the City” placed No. 1 for the weekend, Paramount’s “Indiana Jones and the Kingdom of the Crystal Skull” dropped to second. The film, directed by Steven Spielberg, had a strong $46 million in ticket sales, bringing its total to $216 million since opening on May 22.

But the weekend’s second major surprise came from Universal, which had some good news, even as its backlot suffered a major fire over the weekend. “The Strangers,” a horror film made for about $9 million, took in $20.7 million for the company’s Rogue Pictures specialty unit.

Like “Sex and the City,” the horror film was rated R — usually a limiting factor at the spring-summer box office, which has traded in recent years on sequels and fantasy films with softer ratings. Yet the movie became Universal’s biggest of the year, beating its “Forgetting Sarah Marshall.” And it raised hopes that audiences will respond in large numbers to a number of studio films like “Pineapple Express” from Sony Pictures Entertainment and “Tropic Thunder” from DreamWorks and Paramount, which, in the coming weeks, will test viewer willingness to turn out in large numbers for something other than repeat performances.

Hollywood could use the help. Even with the strong performances of the Top 3 movies this weekend, year-to-date results still lag last year’s total. According to Media by Numbers, a box-office tracking firm, tickets sales are off about 2.8 percent and attendance is down 5.5 percent compared with the corresponding time last year.

Whether the rest of the summer’s entrants will excite moviegoers as much as last year remains to be seen, but one thing is certain: The striking success of “Sex and the City” will spark immediate talk of another movie with Ms. Parker and her sidekicks — Cynthia Nixon, Kim Cattrall and Kristin Davis.

“They might be talking about a sequel,” she said. “But it still feels like we’re opening this movie.”

She added: “Michael and I still have never discussed it. It would have been greedy.”

Abuzz at Racy Novel of Sex and Hygiene
Nicholas Kulish

Not many literary readings are restricted to an over-18 audience. Fewer still take place under circus tents. Yet nothing could be more appropriate for the scandalous German best-seller “Wetlands,” by a television personality and author, Charlotte Roche.

With her jaunty dissection of the sex life and the private grooming habits of the novel’s 18-year-old narrator, Helen Memel, Ms. Roche has turned the previously unspeakable into the national conversation in Germany. Since its debut in February, the novel (“Feuchtgebiete,” in German) has sold more than 680,000 copies, becoming the only German book to top Amazon.com’s global best-seller list.

The book, which will be published next year in the United States, is a headlong dash through every crevice and byproduct, physical and psychological, of its narrator’s body and mind. It is difficult to overstate the raunchiness of the novel, and hard to describe in a family newspaper.

“Wetlands” opens in a hospital room after an intimate shaving accident. It gives a detailed topography of Helen’s hemorrhoids, continues into the subject of anal intercourse and only gains momentum from there, eventually reaching avocado pits as objects of female sexual satisfaction and — here is where the debate kicks in — just possibly female empowerment.

The subject has struck a nerve here, catching a wave of popular interest in renewing the debate over women’s roles and image in society.

With its female chancellor, Angela Merkel, and progressive reputation, Germany would hardly seem to be thirsting for such a discussion. Yet, Germany has an old-fashioned tendency to expect women to choose between careers and motherhood rather than trying to accommodate both.

Last year, another German television personality provoked a storm of controversy about the role of women by suggesting that they should stay home to raise their children, and then referring approvingly to the Nazi policy of encouraging German women to have large families.

Beyond the historical land mines, there are also measurable gender-equality problems in Germany, Europe’s largest economy. Of the 27 European Union members, Germany is tied with Slovakia as third worst in the wage gap between men and women, with women earning 22 percent less, a figure surpassed only by Cyprus and Estonia.

So the topic is being debated in every newspaper and magazine in Germany right now. The discussion has been amplified by two nonfiction books about young women, the more traditional “New German Girls” and “We Alpha-Girls.”

A provocative female rapper in Germany, Lady Bitch Ray, who runs her own independent label, Vagina Style Records, grabbed headlines when she accused Ms. Roche of stealing her explicit form of empowering raunch. “I am what’s in the book,” said the rapper, 27, whose real name is Reyhan Sahin, in a telephone interview.

Germans have been accused, on occasion, of overanalyzing. Sometimes a funny, dirty book is just a funny, dirty book, but not this one, according to its author.

Ms. Roche, 30, has long identified herself as a feminist and, in a vein first explored in 1960s-era American feminism, describes the book as a cri de coeur against the oppression of a waxed, shaved, douched and otherwise sanitized women’s world.

Newspapers here have contrasted her unhygienic, free-spirited fictional heroine to an American-import model of womanhood: the stable of plucked, pencil-thin contestants on “Germany’s Next Top Model,” a popular reality show hosted by the German supermodel Heidi Klum.

But Ms. Roche told the audience here that her inspiration for the book came not from those women, but from the feminine-product aisle of her local store. Peeking out at the audience from under dark brown bangs, speaking in a childish voice that accentuated her transgressions against propriety, Ms. Roche explained, to howls of laughter, how the lemon-scented products called out to her in uncensored terms that she was, as the commercials put it, not so fresh, or at least not fresh enough.

“It’s not feminist in a political sense, but instead feminism of the body, that has to do with anxiety and repression and the fear that you stink, and this for me is clearly feminist, that one builds confidence with your own body,” Ms. Roche, the mother of a young daughter and more serious in person than onstage, said last week in an interview after her reading here.

Ms. Roche’s critics say that it is just a modern spin on not shaving your legs, this time for the genital-waxing generation. Meanwhile, sex sells and tends to grab the spotlight. As a result, a debate that might more profitably center on career counselors and day care is instead mired in old questions about sexual liberation.

With this in mind, critics have asked what practical help a book like “Wetlands” can offer, and even whether, by hyper-sexualizing the main character, it represents an all-too-familiar commercial ploy rather than a step forward.

“The combination of pornography and feminism is old, and was already a favorite marketing strategy for Playboy in the ’70s,” said Alice Schwarzer, Germany’s best-known feminist and founder of the magazine EMMA, modeled in part on Gloria Steinem’s Ms. magazine, in an e-mail message responding to questions about the recent books. “Right now we’re living through another revival.”

Those revivals come along fairly frequently — think the porn star turned “sex educator,” Annie Sprinkle, Madonna and Eve Ensler of “The Vagina Monologues” — with varying degrees of relevance to feminism.

“When a woman breaks a taboo, it is automatically incorporated into the feminism debate, whether it really belongs there or not,” said Ingrid Kolb, a German writer and longtime feminist.

While her generation in Europe and America grappled with many of the same issues in the early 1970s, there are differences, said Ms. Kolb, 67. For instance, the extremity of the beauty cult, particularly with surgery, was nowhere near what it is today.

The notion of sexiness and sexual frankness as feminism — pop empowerment, if you will — is well established on both sides of the Atlantic. As in the United States, “Sex and the City” roared past the new “Indiana Jones” movie for the top spot at the German box office last weekend.

“Wetlands” is something different. It is far more anatomical and scatological than erotic. In the interview, Ms. Roche said she wrote scenes specifically to build up arousal, only to bury them again in the repulsive. Lost in the whole hubbub is also a very sad story about a young woman who has undergone family traumas, the emotional core of the novel.

The event had something of a circus atmosphere. Some 200 fans showed up at the yellow-and-red-striped tent, paying more than $25 each to hear Ms. Roche read and answer questions. As the signing began, the song “Rivers of Babylon” pumped through the speakers, which, in the book, one of Helen’s lovers sang as an ode to her sexual readiness.

Ardent fans have shown up to her readings with avocados as presents and, in several instances documented in the local media, the unprepared have fainted at some of the scenes. In one of those, Helen describes saving dried semen under her fingernails as “a keepsake” to savor later. And as attested by the reading in tiny Tegernheim — a suburb of Regensburg on the Danube River, in famously conservative Bavaria — the controversy surrounding the book is more than a media ruckus just in Berlin and other big cities.

“ ‘Sex and the City’ is always just about sex, whereas this is more about hygiene, or, better put, not-hygiene. It’s just something completely new,” said Katja Bergmeister, 24, a student in Regensburg. She came with her roommate and her roommate’s sister, all in their 20s and all clutching autographed posters of Ms. Roche. “I could see how we would be able to speak more openly with one another now,” she said.

Ms. Bergmeister and her friends knew of Ms. Roche from her work as a presenter for music video channels, but many others said they had come to her through the book. “It’s sexuality like it’s never represented in women’s magazines, but more the way it is in real life,” said Silvia Wilfurth, 28, a psychiatrist. “It speaks to themes of the body and sexuality that normally are not addressed and that it is not bad at all to be discussed.”

Ms. Roche, who was born in Britain but moved to Germany when she was a small child, said she hoped to help women find “a language for lust.” The sensational response to her book was unexpected, but she has taken it all in stride, including her first turn under the big top. “I would say that my own profession is circus pony, so I feel quite comfortable,” she said.

Alex Bolland, the organizer of the reading, said that the local authorities had made him limit the event to an over-18 audience, but that he was still glad he could book Ms. Roche.

“There are almost no taboos today,” Mr. Bolland said. “I appreciate it when someone can show that there are still a few out there.”

Victor Homola contributed reporting from Berlin.

Obscene Losses

DVD sales are in free fall. Audiences are flocking to pornographic knockoffs of YouTube, especially a secretive site called YouPorn. And the amateurs are taking over. What’s happening to the adult-entertainment industry is exactly what’s happening to its Hollywood counterpart—only worse.
Claire Hoffman

On Friday, May 18, Steve Hirsch, founder of Vivid Entertainment Group, the world’s largest producer of adult videos, was expecting a mysterious visitor. But Stephen Paul Jones was late. When Jones, an unknown figure in the pornography world, finally arrived in the all-white reception area of Vivid’s Los Angeles offices at 2 p.m., he was apologetic. His private plane had broken down, he explained, and he was forced to fly commercial. Hirsch, dressed in a T-shirt and jeans, found that excuse a little slick. But he was eager to speak with Jones, so he let it slide and introduced him to two Vivid colleagues. When the four men sat down in the company’s conference room, Jones got right to the point: He wanted Vivid to buy his website, YouPorn.com.

As its name suggests, YouPorn lets users upload and watch a virtually unlimited selection of hardcore sex videos for free. The user-generated clips on YouPorn—like those on YouTube, the site it mimics—range from the grainiest amateur footage to the slickest professional product. Also, like YouTube, the site has far more traffic than income. Just nine months after going live, in September 2006, YouPorn was on pace to log about 15 million unique visitors in May, Jones told the Vivid executives, and its audience was growing at a rate of 37.5 percent a month. Today, YouPorn is the No. 1 adult site in the world; Vivid.com, a pay site, is ranked 5,061. According to Alexa, a website-ranking company, YouPorn’s overall rank is higher than CNN.com (84), About.com (114), and Weather.com (195). (Those numbers are averages for the three-month period from mid-June to mid-September.)

Blond, barrel-chested, and wearing a sport coat, Jones oozed Silicon Valley confidence. According to Hirsch, he mentioned his Stanford M.B.A. repeatedly. He offered reams of documents and audience data, emphasizing YouPorn’s global reach. (Only 12 percent of the site’s traffic comes from the U.S., he said.) Jones told the men that he and one other executive, a young Malaysian man living in Australia, were the owners of YouPorn, and he stressed that with the site’s traffic, its opportunities were manifold: dating, gaming, mobile content, pay-per-view, webcams (“already very popular in China”), and more. He shared his vision of turning YouPorn into a “very cool brand, perhaps the Virgin of adult entertainment.” As Jones rambled on, Hirsch and his executives traded raised eyebrows. Malaysia?

Still, they were intrigued by YouPorn—and more than a little intimidated by its size. In recent years, competition from the internet had cut deep into the porn studio’s revenues. DVD sales, once Vivid’s financial bedrock, were down almost 50 percent since 2004, and the proliferation of cheap Web-based videos was stealing market share from the company, which specializes in high-end sex films. Vivid and its top rivals—Wicked Pictures, Evil Angel, Digital Playground, Red Light District, Penthouse Media Group, and Hustler, to name a few—had lately been getting an unwanted glimpse of the overnight crisis that the file-sharing revolution brought to the music industry and Craigslist brought to newspaper classified ads.

The meeting lasted an hour. As Hirsch listened to Jones’ pitch, he considered the risks of acquiring YouPorn. Hirsch had been in the adult-entertainment business long enough to be mindful of its legal pitfalls, and that was a chief concern. How do you verify the age of the participants in these thousands of sex videos—or, for that matter, the age of the audience?

For the time being, Hirsch put those questions aside and focused on the business challenge: How, exactly, would you monetize this site? All the features were free, and, as Jones admitted, the advertising revenue was meager—about $120,000 a month. Jones said he wasn’t too interested in figuring that out himself. He planned to grow the audience as large as possible and then “exit” to an established company with the resources and know-how to parlay the traffic into revenue. Not that he’s expecting the $1.65 billion Google paid for YouTube or even the $580 million Rupert Murdoch coughed up for MySpace. Jones told Hirsch he’d be willing to part with YouPorn for $20 million. Hirsch said he’d be in touch.

“It doesn’t make any sense!” Hirsch tells me a month later. It’s a hazy afternoon in June, and he is sitting behind his oak-slab desk, his eyes flickering between a pair of flat-screen monitors, one tuned to Bloomberg News and the other showing a YouPorn clip featuring a gaggle of naked women and an oxygen mask. “They’re giving porn away. You can’t make money on this.”

A compact, well-exercised man of 46, Hirsch is one of the biggest names in the $12 billion adult-entertainment business. The very picture of a respectable, down-to-earth smut peddler, he lives with his wife and two young children in a gated community in a quiet suburb in California’s San Fernando Valley, the industry’s global capital. He’s proudly sober, eschewing the rollicking parties of the sex business for quiet passions, such as his prehistoric-amber collection.

Hirsch’s life in the industry started early. In 1970s Cleveland, his father left a career as a stockbroker, says Hirsch, to sell stag films for Reuben Sturman, the porn pioneer who eventually went to jail for tax evasion. Hirsch went to work for Sturman during high school, and Sturman nurtured the young man into a sort of porn prodigy. In 1984, when Hirsch was 23, he co-founded Vivid with the then-novel idea of signing actresses to exclusive contracts and marketing them like Old Hollywood stars. He was just in time for the dawn of the VCR, and Vivid grew quickly. It has been the largest producer of adult videos in the world for more than a decade now, in part because Hirsch borrowed heavily from the Hollywood studios he can see from his office window: expensive sets, big names (most famously Jenna Jameson), and slick packaging. By porn-industry standards, his films are expensive. He says they typically cost $50,000 to $300,000 to produce and $20,000 to market and distribute; they sell for about $25 on DVD. The company makes approximately 60 movies a year and posts roughly $100 million in annual revenue.

But lately, success hasn’t come easily for Vivid and its upmarket rivals. Three years ago, 80 percent of Vivid’s income came from DVD sales. Today, Hirsch puts that number at about 30 percent, with the rest coming from a fragmented range of sources: subscriptions to Vivid.com, pay-per-view TV, internet video-on-demand, merchandising, and mobile-phone deals. Domestic DVD sales are down 35 percent this year alone. His revenue is flat, he says, but that’s mainly because he’s been cutting costs. Within five years, he claims, DVD sales will be close to zero.

Vivid’s situation is grim but not unusual. DVD woes plague the entire Valley, from multimillion-dollar corporate operations to backroom bottom-feeders: Total sales fell 11 percent in 2006, to an estimated $3.8 billion, according to Adult Video News, the industry’s leading trade publication. Hirsch’s company shares the high end of the market with about 20 other studios that each claim more than $20 million in annual revenues. Outside of those are at least 100 small producers who bring in $500,000 to $5 million a year, estimates Paul Fishbein, president of Adult Video News. These companies shoot on shoestring budgets of $10,000 or less (sometimes much less) per film. “Those rinky-dink companies are struggling to get 1,000 to 1,200 DVDs out at $8 to $10 wholesale,” says Fishbein. “That barely pays for the cost of a cheap production.”

And the decline of DVDs will only accelerate. “You’re going to see a precipitous drop now,” Fishbein says. “Hopefully for producers here in the Valley, that will be offset by internet sales. Hopefully.”
As the portion of Americans with broadband connections (47 percent and growing) continues to rise, consumers are becoming increasingly addicted to the immediate gratification of Web video. But suddenly, there’s a chasm between porn consumption and porn sales. While sales of internet-based adult entertainment grew 14 percent last year, to $2.8 billion, that figure would be substantially higher if there wasn’t so much free competition, especially from the user-generated adult sites.

So far, the Valley’s biggest players have tried to combat this by offering subscription sites, which give users access to a deep trove of content in exchange for a membership fee, usually paid monthly. Vivid.com is one of the more successful. With about 40,000 subscribers paying $30 a month, Hirsch says, the site generates roughly $15 million in annual revenue. Ali Joone, the founder of Digital Playground, charges the same monthly rate and says he has a comparable number of subscribers.

Much like the TV networks, movie studios, and record labels on the other side of town, porn companies are also engaged in a frantic attempt to diversify their offerings, filleting their films into smaller pieces that can be easily sold via an ever-shifting variety of digital distribution channels. From the pay-by-the-minute model on video-on-demand sites such as Adult Entertainment Broadcast Network and Hotmovies.com, to the four- to six-minute clips edited for mobile devices, the industry is looking to take the 90-minute sex videos from its old business strategy and carve them into bite-size moneymakers.

But for many companies, the sum of these new revenue streams doesn’t even come close to offsetting the decline in DVD sales. What’s happening in porn right now is directly analogous to what’s happening to the music industry—CD sales are down 16 percent since 2005, according to Nielsen SoundScan—but worse.

“What you’re losing in the DVD market, you’re not making up on the paid internet side,” says Fishbein. “Instead of 99 cents a song on iTunes, these guys are doing 10 cents a minute for porn.”

The irony is that Hirsch and his ilk have always been the first to experiment with—and profit from—new technologies. The revolution began with VHS, which moved porn out of the theater and into the home. This made watching pornography private, an advance that created millions of new customers overnight. But to buy the stuff, you still had to venture out to the store, and who knew who you might run into?

The Web, in its early days, solved this problem. Few industries, if any, figured out e-commerce faster than the adult-entertainment business, and online DVD sales soared as a result. But Web 2.0, the catchall term for the crush of user-driven startups that have emerged in the past few years, has left the porn industry’s biggest players scrambling to keep up. For the first time, technology is hurting Big Porn. “Everyone was excited because they thought the internet was going to affect our business in a positive way, and it’s been the opposite,” says David Joseph, the founder of Red Light District. “It’s been a little scary.”

“Instilling the most fear are YouPorn and its closest competitors, Adult Entertainment Broadcast Network’s PornoTube and Megarotic, which draws in users with a limited layer of free videos, then tries to sell premium memberships that offer more content and faster video streaming.

These sites didn’t invent free porn; they just made it exponentially easier to access. Of the three, YouPorn most closely resembles YouTube, with its stripped-down interface, unobtrusive advertising, and—for now, at least—content that’s 100 percent free. PornoTube and Megarotic feel more commercial, with plenty of links to the for-pay features. But the free parts of all three sites are basically the same. Some videos are lengthy (30 minutes or more), but most are closer to three minutes. Some are bona fide amateur videos, shot and uploaded by exhibitionists, but most are clips of copyrighted professional pornography. Of these, some are scenes from high-end features, but a larger percentage are so-called gonzo clips—unscripted, rough-cut footage in which the camera operator often jumps into the action. Some clips are posted by the porn companies themselves, as trailers for the full-length versions available on their own sites, but most are uploaded by users from their own collections. Some are gay, some are straight.

In other words, there’s something for everyone—and the sites are ridiculously easy to use. You don’t even have to log in to watch videos, much less pay. (You’re simply required to say you’re 18 or older.) And the sites can’t prevent users from uploading proprietary material produced by the major porn studios. All of which is why Hirsch and his counterparts in the Valley are at least as nervous as the Viacom executives who have filed a $1 billion copyright suit against Google, YouTube’s owner.

But for now at least, there’s no significant push to shut down the sites. Although producers in the Valley have largely resigned themselves to the fact that the copyright genie is out of the bottle, they’re putting user-generated sites on notice about former moneymaking features that are now posted for all to enjoy. A few major porn companies say they regularly monitor postings on PornoTube and YouPorn and email requests to take down copyrighted material. In July, Red Light District sent a cease-and-desist letter to YouPorn after a user posted “One Night in Paris,” the “official” full-length version of the Paris Hilton sex tape, which Red Light distributes. YouPorn removed the video.

By their very nature, though, user-generated sites might be vulnerable to other kinds of legal problems. If anonymous users post child pornography, it could be difficult for site owners to verify the ages of the performers. While these sites generally require viewers to confirm that they’re over 18, “my 11-year-old could go on at any point,” says Red Light’s Joseph. Earlier this fall, a German internet provider temporarily blocked access to YouPorn because the site didn’t comply with German age-verification laws. Up to now, U.S. user-generated porn sites have not been prosecuted.

There’s no sign on the door of PornoTube’s headquarters, in Charlotte, North Carolina. The building is concealed in a low-slung office park on the outskirts of the city, next to the railroad tracks and an aluminum factory.

Inside the air-freshened warren of bunkerlike offices, Suzann Knudsen, a PornoTube marketing executive who moonlights as a D.J. for sex-fetish parties, shows me around. She explains that despite PornoTube’s 15 million monthly visitors, the website’s parent company, Adult Entertainment Broadcast Network, views it as a marketing expense, not a profit center. The site was originally conceived as a feature within Xpeeps.com, A.E.B.N.’s X-rated social-networking site, to provide a way for members to trade sex videos. But soon after it launched, in July 2006, PornoTube had dwarfed Xpeeps’ traffic, and A.E.B.N. decided to turn it into a separate site. The Week in Review is edited and published by Jack Spratts. The company has tried to monetize it by striking profit-sharing deals with two dozen porn studios to create promotional channels that funnel traffic toward the studios’ own sites. A.E.B.N. won’t disclose the value of these agreements or the small amount of advertising revenue generated by the ads placed on page margins, saying only that PornoTube breaks even. It’s worth it, Knudsen says, for the traffic.

But when traffic means tens of millions of people sharing porn, there are some unique business challenges. Daphne Reeder, a customer-service rep for PornoTube, spends her days trolling the site, investigating clips that have been reported as problematic. On the July morning when I visit, she had more than 500 videos to review, most of which had been red-flagged because their descriptions included words such as little boys, force, or rape. She says the community polices itself, with users and porn companies emailing to alert the site about child pornography, copyrights being violated, ex-boyfriends uploading once-private videos, and other issues.

Adult-video producers are legally required to verify that performers are of legal age. The 2257’s, as the verifications are known (after the corresponding section of the federal code), are a costly hassle to the porn studios. Vivid, for example, has an employee whose sole responsibility is 2257 compliance, and Vivid makes only 60 films a year. Reeder is one of 10 people working on compliance at PornoTube, which has about 210,000 videos. Every clip on the site is supposed to contain a link to “2257 info” documenting the age and identity of the performers, but many of the clips (mostly the genuine amateur videos) include no such information. In these cases, PornoTube attempts to perform its own verification. If it can’t, the clip is removed.

One of the items on Reeder’s to-do list is an age-verification complaint about a video called “Adriana Lima Blowjob.” It has no 2257 info. So Reeder cuts and pastes the name into a search engine and clicks through a few sites that say Adriana Lima was born in 1981. Reeder is about to move on when I point out to her that Adriana Lima is in fact a fairly well-known model and that the woman in the video is probably not she. Is PornoTube concerned about that? Knudsen, standing behind Reeder, tells her to take it down quickly. “We do the best we can,” Knudsen tells me repeatedly.

So how are big adult-video companies coping with the borderless erotic geography of the Web? By creating ever more expensive product. Like their counterparts on the other side of the Santa Monica Mountains, the studios realize they can’t fight amateur with amateur. Instead, Penthouse, Vivid, and others are more committed than ever to their version of the Hollywood model—big budgets, big names, big marketing, and content distributed across a range of platforms.

In a hilltop home in an affluent corner of the Valley, Kelly Holland, the 47-year-old head of production for Penthouse Media Group, stands behind a camera monitor. She wears crisp khakis and well-worn white sneakers, and her lens is trained on a performer named Dee Lilly, who is wearing a beaded black corset. Lilly sways lazily to soft rock. Curtains billow in a fan-generated breeze.

“Beautiful, baby girl, it looks gorgeous,” Holland encourages, as she watches on the monitor 10 feet away. Sitting beside her, a beefy lighting guy stares blankly out the window at the dirty swimming pool. The rest of the heavily tattooed crew—more than two dozen—wander in and out of the kitchen, where the caterer has laid out platters of just-cooked salmon, rice, and vegetables. James Sullivan, the chief operating officer of Penthouse, is visiting from New York. He stands behind Holland, studiously casual in dress shoes and a T-shirt. As the scene wraps up, Holland asks the actress to leave the frame. When Lilly stumbles, tripping over her towering plastic stilettos, Holland sweetly reassures her. “You’re so cute,” she says, “you don’t have to know how to walk.”

Holland’s plan for the day is to shoot two features, each cut in a hardcore and softcore edition, plus softcore and topless content for the Web and on-demand cable. Time is tight, and the director hustles the performers around the set in order to get the most footage for their day rate: usually about $800 to $1,500 for women, less for men. Today’s shoot is a conscious counterjab at the cheaply produced, handheld hardcore videos that flood user-generated adult sites and chip away at the big studios’ bottom line. The total budget for three days of filming is about $110,000.

As Holland shoots Lilly for the softcore episode, designed to be downloaded onto a cell phone, another director is shooting a feature in a nearby room. Titled The Looking Glass, it’s the story of a young suburban couple who buy their first home, only to discover that one of its sliding glass doors is a portal into an alternate universe where people have nonstop sex. In a bedroom done up like a Pottery Barn showroom, performers Alec Knight and Carolyn Reese are staging a crucial scene. With blond extensions and a thick mask of makeup, Reese is attractive in a girl-next-door-in-L.A. kind of way. Knight is equally average, for the most part. As they go through the motions, the cameraman urges them to act lovingly toward each other. No matter what position they’re in, they find a way to gaze into each other’s eyes.

Holland, a veteran in the growing ranks of female directors, believes women—and the men who want to watch with them—are customers she won’t lose to online viewing. “Women are more reliable, they are more loyal, and they spend more money,” she says. “For women, you have to make sure the girls have great manicures, great pedicures, and great lingerie—put them in La Perla or Agent Provocateur—and you can serve up some pretty explicit material.” Holland cites HBO’s new sexually explicit miniseries Tell Me You Love Me as evidence of just how mainstream pornography has become.

“It’s not just a man thing,” agrees Samantha Lewis, the C.E.O. of Digital Playground, who estimates that 45 percent of her Web-based sales (which include site subscriptions and DVDs sold online) are to women. “As each year goes by, we’re realizing, Oh my goodness. The percentages are climbing.”

The porn industry has long wanted to expand its female audience, but some producers concede it will take more than fancy sets, gauzy lighting, and a story line. “Women are just as unpredictable as men, only more so,” says Phil Harvey, the 69-year-old Harvard grad who 35 years ago founded Adam & Eve, a $90 million adult-film producer and sex-toy retailer based in Hillsborough, North Carolina. Harvey is a pioneer in marketing toys and videos to women and couples, having instituted a “sex positive” approach to pornographic retailing in the late 1980s. But as important as women are to Adam & Eve’s business—Harvey says 40 percent of its Web customers are female—he cautions against overgeneralizing. “At least five times we’ve tried to produce a women’s catalog, with cuddling and coupling,” he says drily. “It didn’t work.”

What has worked, Harvey says, is porn that is best appreciated on the big screen—or at least a television. Last year, Adam & Eve teamed with Digital Playground to make Pirates, an adult take on Disney’s billion-dollar Pirates of the Caribbean franchise. Shot in high definition, set to an original score, and driven by a plot involving Incan magic and sea battles, Pirates was billed by its producers as an “electrifying and swashbuckling sex tale.” Digital Playground’s Joone says the film cost the two studios more than $3 million to make—one of the biggest budgets ever for an adult video—and the resulting three-disc set initially sold for $50. Harvey credits Pirates, Adam & Eve’s bestselling film of all time, with helping to pull the company out of a five-year growth slump that he attributes directly to intense competition from free porn on the Web.

YouPorn—the site Stephen Paul Jones tried to sell to Vivid in May—is a strange and mysterious business. There are no links to founders’ biographies, no contact information, no hint of who is behind this booming Web entity. Its domain is registered using a service designed to mask the registrant’s identity.

Back in July, I sent an email to the lone address on the site. It went unanswered. I asked around and, after a series of dead ends, was told that a Stanford alumnus—an outsider to the industry—had started YouPorn. A porn producer gave me the man’s cell-phone number. I left a voicemail. Jones called back a few hours later.

“It’s a brave new world, man. People are crazy. What can I say?” he said, during a freewheeling two-hour conversation that swung wildly from the subjugation of female porn stars to federal regulations governing obscenity to the existence (or nonexistence) of God. Jones insisted that the site was not intended to make money. “It’s not a profit center; it’s more of an experiment. If you wanted to be philosophical about it, it’s kind of an exploitative industry, and this is sort of the opposite.”

Jones said that “Stephen Paul Jones” was an alias. He said that he was 27 years old and worked at a Newport Beach, California, hedge fund, where he managed billions in assets. He used the alias, he said, because his bosses would fire him if they knew about YouPorn. He said he wasn’t the owner of the site anyway. He said it was founded by “a German” who wrote the underlying software and now runs the site’s day-to-day operations.

Still, Jones seemed proud of YouPorn. “People have been telling me that this site would die and the traffic would go away, and they’ve all been wrong,” he said. “When a new model enters the market and impacts other companies’ business by 15 percent of their revenue in a year, that’s historymaking.

“Porn is recession-proof,” he went on, “so if other companies’ sales are going down, there’s a reason. If the reason is the world saying ‘We like to blast ourselves over the internet,’ and the consumers of the world saying ‘We like the amateur stuff better,’ then that’s significant. You could call it a revolution.” He liked the sound of that. “Sure, why not?”

It turns out there is a Stanford alum named Stephen Paul Jones. But he’s fortyish, not 27, and he lives in South Lake Tahoe, California, not Newport Beach. In the past two decades, this Stephen Paul Jones seems to have had no connection to the adult-entertainment business. Public records show that he was involved in a handful of security companies. According to Stanford alumni records (he earned his M.B.A. last year), he enjoys skydiving, stunt piloting, and snowboarding.

Meanwhile, the man who says he’s 27 and uses Jones as an alias has stopped returning my calls. So I drive north to Lake Tahoe.

I knock on the door of a lodgelike three-story house with an enormous backyard. A blond, barrel-chested man answers, an entourage of children in tow. I tell him my name and ask to speak to Jones. “Wrong house,” he says, as his face goes hard. His wife asks what this is about. I say I am a reporter writing about an internet company. “Oh,” she says and gives him a look.

He hustles his family inside, grabs a pack of cigarettes, and comes back outside to yell at me. And from the minute he starts talking, I recognize his voice and his patterns of speech. This is the man I spoke to on the phone. This is the same Stephen Paul Jones.

Jones confirms this, apparently without meaning to, saying he knew during our phone conversation that I had an agenda because I told him that I didn’t like porn. (I told him no such thing.) He threatens to sue me, saying he has “Google’s lawyers.” Then he asks if we can talk somewhere farther away from his home. He drives his S.U.V. about a mile down the road, with me following. For the next 2˝ hours, in a diatribe that is always convoluted and occasionally hostile, he keeps returning to one theme: his amazement at the sheer number of people who visit YouPorn every day. And he repeatedly insists that he is not the site’s owner.

But in his emails to Vivid executives, Jones had described himself as “the decisionmaker at YouPorn” and said that he and his Malaysian partner, Zach Hong, “own 100 percent of the company.” (Hong, when reached at his home in Australia, confirmed his involvement with YouPorn but declined to answer further questions.) In these emails, Jones sounded like a no-nonsense M.B.A. with an articulate, if familiar, vision for growing his Web 2.0 company. Among other things, he said he would follow “the Skype model” and cited a quote he attributed to one of Skype’s founders: “If we have 100 million users, and if just 1 percent of them give us $10 per month, we will have $120 million in revenue.”

Now, though, leaning against my car on a dark country road, Jones refuses to answer the most basic questions about the financial particulars of YouPorn or his plans for its future. As the conversation wears on, he sounds proud of the site one minute and worried about tarnishing his family’s reputation the next. After all, he says, he has five kids. He seems deeply conflicted about being in the sex business, much less a mastermind of the most popular adult site in the world.

Back in the Valley, Vivid’s Hirsch says that while he envies YouPorn’s traffic, he has no plans to buy the site, mainly because of the legal exposure associated with hosting user-generated pornography. But he also says that he can’t figure out how to make money through YouPorn and that it would be inconsistent with his strategy of focusing on high-end feature films. A.E.B.N. was also approached by Jones, says an executive there, and passed on YouPorn too.

According to several industry executives who say they would have heard otherwise, YouPorn hasn’t been sold. After our conversation near his home, Jones continued to deny that he owns the site.

As this issue went to press, YouPorn’s Alexa rank was 51—and rising.

Dough! "Simpsons" Cast Gets A Hefty Raise

The standoff between "The Simpsons" voice cast and series producer 20th Century Fox TV is over.

After months of negotiations, the cast of Fox's long-running animated series reached a new four-year deal with the studio during the weekend.

Under the pact, the top actors will be paid nearly $400,000 per episode. While this is lower than the reported $500,000 the cast originally sought, it remains a significant increase from their current paychecks of about $300,000 an episode. (By contrast, Charlie Sheen is the highest-paid sitcom star, reportedly earning $350,000 per episode in 2006.)

Additionally, Dan Castellaneta, who voices Homer Simpson and has penned several "Simpsons" episodes over the years, is being named a consulting producer.

Castellaneta and most of the other key "Simpsons" voice players -- Julie Kavner (Marge), Nancy Cartwright (Bart), Yeardley Smith (Lisa) and Hank Azaria (Moe) -- are slated to begin work on the upcoming 20th season Tuesday.

As of Monday, the status of Harry Shearer, who voices Mr. Burns and Ned Flanders, among other characters, was unclear. Because of a last-minute snag, his deal did not close with the other cast members', and it was not clear if he would show up for work on Tuesday.

As a result of the drawn-out contract negotiations, the upcoming season of "The Simpsons" has been reduced by two episodes to 20. While the deal makes the voice cast available for four more seasons, Fox has yet to order the animated comedy beyond season No. 20.

The "Simpsons" cast and 20th TV have been down this road before. Most recently in 2004, the actors held up production of the 16th season by skipping two table reads during negotiations. They ended up more than doubling their previous salary.

Spike Lee Gets In Clint Eastwood's Line of Fire
Paul Lewis

• Director told to 'shut his face' after race comments
• Row over black casting in second world war films

Clint Eastwood has advised rival film director Spike Lee to "shut his face" after the African-American complained about the racial make-up of Eastwood's films.

In an interview with the Guardian published today, Eastwood rejected Lee's complaint that he had failed to include a single African-American soldier in his films Flags of Our Fathers and Letters from Iwo Jima, both about the 1945 battle for the Japanese island.

In typically outspoken language, Eastwood justified his choice of actors, saying that those black troops who did take part in the battle as part of a munitions company didn't raise the flag. The battle is known by the image of US marines raising the American flag on Mount Suribachi.

"The story is Flags of Our Fathers, the famous flag-raising picture, and they didn't do that. If I go ahead and put an African-American actor in there, people'd go: 'This guy's lost his mind.' I mean, it's not accurate." Referring to Lee, he added: "A guy like him should shut his face."

Lee's comments came during a press conference to promote his own war film, Miracle at St Anna, at the Cannes film festival last month. "Clint Eastwood made two films about Iwo Jima that ran for more than four hours total, and there was not one Negro actor on the screen," Lee said. "If you reporters had any balls you'd ask him why. There's no way I know why he did that ... But I know it was pointed out to him and that he could have changed it. It's not like he didn't know."

Lee's own film, about members of the all-black 92nd Buffalo Division, which fought in Italy, is an attempt to set second world war history straight.

Eastwood, who described himself as libertarian - "Just stay out of everybody else's hair" - has a reputation for outspoken remarks. He once said he would kill fellow film-maker Michael Moore if he showed up uninvited at his house. His 2004 double-Oscar-winning film Million Dollar Baby was criticised by Christian groups who objected to part of the plot involving "assisted suicide".

Defending the racial make-up in his films as historically accurate, Eastwood referred to another of his films, Changeling, which was set in Los Angeles before the city had a large group of African-Americans. "What are you going to do, you going to tell a fuckin' story about that?" he said. "Make it look like a commercial for an equal opportunity player? I'm not in that game. I'm playing it the way I read it historically, and that's the way it is. When I do a movie and it's 90% black, like Bird, then I use 90% black people.

"He was complaining when I did Bird (the 1988 biopic of Charlie Parker). Why would a white guy be doing that? I was the only guy who made it, that's why. He could have gone ahead and made it. Instead he was making something else."

Eastwood's next project, The Human Factor, will be about Nelson Mandela's attempts to foster national unity in post-apartheid South Africa. Asked if he would remain historically accurate with depictions of the former president, he said: "I'm not going to make Nelson Mandela a white guy."

Why BitTorrent Causes So Much Latency and How to Fix It
George Ou

Anyone VoIP or online gamer who has a roommate or a family member who uses BitTorrent (or any P2P application) knows what a nightmare it is when BitTorrent is in use. The ping (round trip latency) goes through the roof and it stays there making VoIP packets drop out and game play impossible. I've personally experienced this and many of my friends have experienced it. When I had a roommate in 1999 and I had my first broadband connection, my roommate started using the hot P2P (peer-to-peer) application of its day called Napster. As soon as he started sharing, my online game would become slow as molasses and I'd experience a huge 500ms second spike in round-trip latency and any gamer knows that pings over 100 are problematic.

When it's just myself using BitTorrent, I can pause it while I make VoIP phone calls or when I want to game. But when it's time to ask your family member or roommate to stop using their application, it becomes awkward because why should they stop using their application just so you can use your application? My roommate paid for half the broadband fees so I couldn't always tell him to stop and he couldn't always ruin my latency making it a contentious situation for both of us. What makes it even more frustrating is that there's plenty of bandwidth capacity to theoretically satisfy both our needs, but something about these P2P applications make them them very bad housemates.

I decided to do some research on this and ran a series of tests which resulted in some very interesting data. I fired up various applications at varying rates of bandwidth utilization in the upstream and downstream direction and I measured latency to my first router hop (ISP router) beyond my home router. I ran continuous pings to the ISP router to check the round-trip latency above the normal baseline latency of 12 ms and plotted out the results. This test methodology measures network latency on the "last mile" which is what I'm primarily concerned about because that's where most of the damage is done by local usage of P2P applications.

BitTorrent downloads cause huge amounts of latency

The first set of tests I did were download tests. First I downloaded a file using HTTP which ran at 260 KB/sec (2.08 Mbps) which is roughly 87% of my peak download performance. I then set BitTorrent to also download at 260 KB/sec to compare the effect on my latency. To my surprise, there was a significant difference in the amount of latency increase between HTTP downloading and BitTorrent downloading despite the fact that both applications were downloading at the same average rate.

When you look at the two graphs immediately above, you see that BitTorrent causes an average increase in latency of more than 117 ms (milliseconds). Note that those 6 ping spikes in the graph were actually bad enough that they caused the ping to time out which means the latency was higher than one second. HTTP on the other hand didn't increase the latency nearly as much but it still caused an average of 46.7 ms increase in latency and it only peaked at 76 ms. So how is this possible when both applications are using the same amount of bandwidth? I did some thinking and this is the hypothesis I came up with.

Burst traffic fills up transmit queues

The difference in latency is caused by the fact that HTTP is a single source of data whereas BitTorrent is about 20 sources of data. Incoming data from from multiple sources via the fast core of the Internet can sometimes clump closely together when multiple sources happen to transmit data around the same time. So in the period of 20 ms (the interval between typical VoIP packets), up to 200 max-size 1472 BYTE packets can occasionally build up in the DSLAM transmit queue (blue square in illustration above labeled as "download queue") causing my ping requests to time out above the 1 second mark. But on average, we get around 23 of these packets causing sitting in the DSLAM transmit queue causing an average increase in latency of 117 ms. When there is a single transmitter, it might burst and clump packets close together but it won't be at the level of 20 transmitters.

With HTTP causing 76 ms of downstream delay, that means 15 of these 1472-BYTE packets are sitting in the DSLAM transmit queue causing a less extreme increase in latency. This is still problematic for VoIP communications and it can certainly ruin online gaming. So despite the fact that their is plenty of remaining bandwidth for my VoIP or online gaming traffic, it's the non-uniformity of the incoming Internet traffic that causes my VoIP phone calls and games to perform badly. Unfortunately since this is the downstream we're talking about, the consumer can't do much about it on their own end of the pipe because the delay is at the DSLAM which belongs to the ISP.

The only way to fix this problem is for the ISP to implement intelligent packet scheduling and application prioritization at the DSLAM to re-order those VoIP or gaming packets to the front of the transmit queue. With packet prioritization (generally referred to as QoS), your family member, your roommate, or your own video downloads won't need to be stopped and they won't interfere with your VoIP or gaming applications which makes everyone happy. Unfortunately, these types of QoS services may never see the light of day if poorly conceived Net Neutrality legislation gets passed that ban the sale of packet prioritization.

BitTorrent uploads cause excessive latency

BitTorrent or P2P uploads also cause a lot of upstream latency. I compared various types of upload traffic patterns to see what kind of increase in the upstream latency would result. First I tried running BitTorrent with a 47 KB/sec (376 Kbps) bandwidth cap which was about 90% of my upload capacity, then I ran BitTorrent with a 28 KB/sec (224 Kbps) bandwidth cap at 54% of my upload capacity, and then I ran BitTorrent with a 10 KB/sec cap at 19% of my upload capacity.

In either the 28 KB/sec test or 10 KB/sec test, I'm not being greedy by hogging all the available upstream bandwidth and I'm leaving more than the 11 KB/sec of bandwidth needed for VoIP and online gaming. Yet I found that the additional latency caused by BitTorrent uploads (seeding) was unacceptable for gaming and problematic for VoIP applications. Even when I severely limited upload throughput to 10 KB/sec, it didn't reduce the latency spikes although it reduced the frequency of those spikes. However, even fewer spikes in latency can pose the same problems for VoIP applications because they have to adjust their buffers to account for the worst-case network conditions. This would seem to indicate that BitTorrent is bursting packets rather than releasing the packets in a uniform and evenly spaced stream.

Next I tried using FTP at full throttle and I managed to get an FTP session going at 47 KB/sec (90% of my peak load) yet the latency caused by FTP at this extreme rate of throughput was less than the latency caused by operating BitTorrent at an average of 10 KB/sec. This would seem to indicate that FTP is outputting data in a more consistent manner that BitTorrent.

Lastly, I ran some latency tests during some VoIP phone calls using the Lingo service (competitor of Vonage). I had set Lingo to use the uncompressed G.711 which uses 11 KB/sec for both upload and download which makes it very comparable to BitTorrent uploading at an average of 10 KB/sec. But as soon as I ran the latency tests, I was shocked to see virtually no increase in latency. I realized that this is because the VoIP ATA (Analog Telephony Adapter) device pulses small packets at exact intervals of 20 milliseconds at 50 times a second.

Smoothing out the packet spacing to reduce latency

After running these tests, I am beginning to conclude that it isn't so much the amount of data that causes excessive latency; it's the uniformity of data transmission. If the transmissions are spaced evenly, other packets from other applications can slip in between the packets rather than getting stuck behind multiple packets in the transmit queue. So would it be possible to engineer BitTorrent to transmit data uniformly and what would be the effect? I came up with the following chart to illustrate what this could mean for peaceful coexistence between VoIP/Gaming and BitTorrent/P2P.

I calculated that the max-size 1472 BYTE packet takes 28.3 milliseconds to transmit over my 52,000 BYTE/sec broadband uplink. If BitTorrent bursts 3 packets upstream over a 100 Mbps FastEthernet LAN connection, they will all sit in the upload queue of my DSL modem for 85 ms. Meanwhile, my VoIP or gaming packets get stuck behind those three packets for an additional 57 ms in the queue. This is shown in the first example in the illustration below with large 1472-BYTE red packets representing BitTorrent and small 223-BYTE green packets representing VoIP.

In the second example, I show what happens if BitTorrent simply spaced their transmissions evenly. It's still less than ideal but at least it significantly reduces the latency for VoIP or gaming packets.

In the third example, I show the ideal scenario where BitTorrent would reduce its packet size to 815 BYTES or less and pulse them out in 20 ms intervals at 50 packets per second. BitTorrent could essentially create a "VoIP friendly mode" that allows VoIP packets to fit cleanly between the BitTorrent packets and the increase in latency would be no greater than 15.7 ms and would typically average around 8 ms increase. BitTorrent could also have a "Game friendly mode" that uses 679-BYTE packets at 60 packets per second.

Now it is possible to solve this problem on the network level by prioritizing VoIP and gaming packets in the home DSL modem upload queue. Unfortunately, I don't have administrative access to the modem and implementing VoIP or gaming prioritization on my home router seemed to have no effect because there is nothing in the transmit queue of the home router since it connect to the DSL modem at 100 Mbps. Packets in the home router get forwarded as soon as they arrive and there is nothing to reorder in the queue because there is nothing in the queue. More advanced business-class routers like those from Cisco will allow you to configure the speed of the FastEthernet connection to match your DSL throughput so that the queue will migrate from the DSL modem to the router but this isn't very practical for most people. So it would make sense for application writers to try and make their application work as well as possible on the majority of home networks and broadband networks without QoS.

While modifying BitTorrent or the P2P application may not significantly fix the downstream problem, it would definitely fix the upstream latency problem which means that people will be more willing to seed and contribute to the health of BitTorrent. The download latency may improve if the dozens of peers sending information to me did it in a more uniform manner, but it is still possible that those peers will transmit at the same time which still causes packet clumping and bursting.

So why would BitTorrent or any P2P application vendor want to do this? Why couldn't they just say "it's not my problem"? Because it would fix their reputation as a bad housemate and more people would be willing to seed if it didn't interfere with their other applications like VoIP or gaming. Corporate IT departments may also ease their ban on the technology if it doesn't trash their Internet connection for the entire office. I am certainly a huge proponent of network-based solutions for dealing with latency problems, but improvements in the application can act to further reduce network latency even in the presence of existing network-based solutions. Furthermore, the vast majority of consumers do not have access to network-based solutions and it only makes sense for a P2P application vendor to cater to this market.

I will try to reach out to BitTorrent corporation to see if there is any interest in this and perhaps someone would be interested in modifying open source Azureus. It would be a very good feature to have or it would be a very interesting academic experiment at the very least.

Oklahoma City Unveils New Wireless Network

Oklahoma City officials are unveiling what they're calling the largest city owned and operated WiFi mesh network in the world.

The $5 million network covers a 555-square-mile area. It does not provide public wireless Internet access.

The network, for public safety and other city workers, was funded with money from a public safety sales tax and city capital improvement funds.

Police officers can use the network to access real-time data, while fire officials can locate water hydrants and review site maps and floor plans while responding to fires or accidents.

A demonstration of the network was scheduled this afternoon at City Hall.

The Future Is Now? Pretty Soon, at Least
John Tierney

Before we get to Ray Kurzweil’s plan for upgrading the “suboptimal software” in your brain, let me pass on some of the cheery news he brought to the World Science Festival last week in New York.

Do you have trouble sticking to a diet? Have patience. Within 10 years, Dr. Kurzweil explained, there will be a drug that lets you eat whatever you want without gaining weight.

Worried about greenhouse gas emissions? Have faith. Solar power may look terribly uneconomical at the moment, but with the exponential progress being made in nanoengineering, Dr. Kurzweil calculates that it’ll be cost-competitive with fossil fuels in just five years, and that within 20 years all our energy will come from clean sources.

Are you depressed by the prospect of dying? Well, if you can hang on another 15 years, your life expectancy will keep rising every year faster than you’re aging. And then, before the century is even half over, you can be around for the Singularity, that revolutionary transition when humans and/or machines start evolving into immortal beings with ever-improving software.

At least that’s Dr. Kurzweil’s calculation. It may sound too good to be true, but even his critics acknowledge he’s not your ordinary sci-fi fantasist. He is a futurist with a track record and enough credibility for the National Academy of Engineering to publish his sunny forecast for solar energy.

He makes his predictions using what he calls the Law of Accelerating Returns, a concept he illustrated at the festival with a history of his own inventions for the blind. In 1976, when he pioneered a device that could scan books and read them aloud, it was the size of a washing machine.

Two decades ago he predicted that “early in the 21st century” blind people would be able to read anything anywhere using a handheld device. In 2002 he narrowed the arrival date to 2008. On Thursday night at the festival, he pulled out a new gadget the size of a cellphone, and when he pointed it at the brochure for the science festival, it had no trouble reading the text aloud.

This invention, Dr. Kurzweil said, was no harder to anticipate than some of the predictions he made in the late 1980s, like the explosive growth of the Internet in the 1990s and a computer chess champion by 1998. (He was off by a year — Deep Blue’s chess victory came in 1997.)

“Certain aspects of technology follow amazingly predictable trajectories,” he said, and showed a graph of computing power starting with the first electromechanical machines more than a century ago. At first the machines’ power doubled every three years; then in midcentury the doubling came every two years (the rate that inspired Moore’s Law); now it takes only about a year.

Dr. Kurzweil has other graphs showing a century of exponential growth in the number of patents issued, the spread of telephones, the money spent on education. One graph of technological changes goes back millions of years, starting with stone tools and accelerating through the development of agriculture, writing, the Industrial Revolution and computers. (For details, see nytimes.com/tierneylab.)

Now, he sees biology, medicine, energy and other fields being revolutionized by information technology. His graphs already show the beginning of exponential progress in nanotechnology, in the ease of gene sequencing, in the resolution of brain scans. With these new tools, he says, by the 2020s we’ll be adding computers to our brains and building machines as smart as ourselves.

This serene confidence is not shared by neuroscientists like Vilayanur S. Ramachandran, who discussed future brains with Dr. Kurzweil at the festival. It might be possible to create a thinking, empathetic machine, Dr. Ramachandran said, but it might prove too difficult to reverse-engineer the brain’s circuitry because it evolved so haphazardly.

“My colleague Francis Crick used to say that God is a hacker, not an engineer,” Dr. Ramachandran said. “You can do reverse engineering, but you can’t do reverse hacking.”

Dr. Kurzweil’s predictions come under intense scrutiny in the engineering magazine IEEE Spectrum, which devotes its current issue to the Singularity. Some of the experts writing in the issue endorse Dr. Kurzweil’s belief that conscious, intelligent beings can be created, but most think it will take more than a few decades.

He is accustomed to this sort of pessimism and readily acknowledges how complicated the brain is. But if experts in neurology and artificial intelligence (or solar energy or medicine) don’t buy his optimistic predictions, he says, that’s because exponential upward curves are so deceptively gradual at first.

“Scientists imagine they’ll keep working at the present pace,” he told me after his speech. “They make linear extrapolations from the past. When it took years to sequence the first 1 percent of the human genome, they worried they’d never finish, but they were right on schedule for an exponential curve. If you reach 1 percent and keep doubling your growth every year, you’ll hit 100 percent in just seven years.”

Dr. Kurzweil is so confident in these curves that he has made a $10,000 bet with Mitch Kapor, the creator of Lotus software. By 2029, Dr. Kurzweil wagers, a computer will pass the Turing Test by carrying on a conversation that is indistinguishable from a human’s.

I’m not as confident those graphs are going to hold up for fields besides computer science, so I’d be leery of betting on a date. But if I had to take sides in the 2029 wager, I’d put my money on Dr. Kurzweil. He could be right once again about a revolution coming sooner than expected. And I’d hate to bet against the chance to be around for this one.

New Design Enables More Cost-effective Quantum Key Distribution

Researchers at the National Institute of Standards and Technology (NIST) have demonstrated a simpler and potentially lower-cost method for distributing strings of digits, or "keys," for use in quantum cryptography, the most secure method of transmitting data. The new "quantum key distribution" (QKD) method, outlined in an upcoming paper, minimizes the required number of detectors, by far the most costly components in quantum cryptography.

Although this minimum-detector arrangement cuts transmission rates by half, the NIST system still works at broadband speeds, allowing, for example, real-time quantum encryption and decryption of webcam-quality video streams over an experimental quantum network.

In quantum cryptography, a recipient (named Bob) needs to measure a sequence of photons, or particles of light that are transmitted by a sender (named Alice). These photons have information encoded in their polarization, or direction of their electric field. In the most common polarization-based protocol, known as BB84, Bob uses four single-photon detectors, costing approximately $5,000-$20,000 each. One pair of detectors records photons with horizontal and vertical polarization, which could indicate 0 and 1 respectively. The other pair detects photons with "diagonal", or +/- 45 degree, polarization in which the "northeast" and "northwest" directions alternatively denote 0 and 1.

In the new method, the researchers, led by NIST's Xiao Tang, designed an optical component to make the diagonally polarized photons rotate by a further 45 degrees and arrive at the same detector but later, and into a separate "time bin", than the horizontal/vertical polarized ones. Therefore, one pair of detectors can be used to record information from both kinds of polarized photons in succession, reducing the required number of detectors from four to two.

In another protocol, called B92, the researchers reduced the required number of detectors from two to one. And in work performed since their new paper, the researchers further developed their approach so that the popular BB84 method now only requires one detector instead of four.

Although in theory quantum cryptography can transmit absolutely secure keys guaranteed by fundamental physical principles (measuring them will disturb their values and make an eavesdropper instantly known), the imperfect properties of photon detectors may undermine system security in practice. For example, photon detectors have an intrinsic problem known as "dead time," in which a detector is out of commission for a short time after it records a photon, causing it to miss the bit of data that immediately follows; this could result in non-random (and therefore more predictable) bit patterns in which 0s alternate with 1s. Furthermore, inevitable performance differences between detector pairs can also cause them to record less random sequences of digits. The new design avoids these issues and maintains the security of quantum-key-distribution systems in practical applications.

Watch Out for a Sneaky Blackmailing Virus that Encrypts Your Data

Kaspersky Lab found a new variant of Gpcode, a dangerous encryptor virus has appeared, - Virus.Win32.Gpcode.ak. Gpcode.ak encrypts files with various extensions including, but not limited, to .doc, .txt, .pdf, .xls, .jpg, .png, .cpp, .h and more using an RSA encryption algorithm with a 1024-bit key.

Kaspersky Lab succeeded in thwarting previous variants of Gpcode when Kaspersky virus analysts were able to crack the private key after in-depth cryptographic analysis. Their researchers have to date been able to crack keys up to 660 bits. This was the result of a detailed analysis of the RSA algorithm implementation. It has been estimated that if the encryption algorithm is implemented correctly, it would take 1 PC with a 2.2 Ghz processor around 30 years to crack a 660-bit key.

The author of Gpcode has taken two years to improve the virus: the previous errors have been fixed and the key has been lengthened to 1024 bits instead of 660.

At the time of writing, Kaspersky researchers are unable to decrypt files encrypted by Gpcode.ak since the key is 1024 bits long and they have not found any errors in implementation yet. Thus, at the time of writing, the only way to decrypt the encrypted files is to use the private key which only the author has.

After Gpcode.ak encrypts files on the victim machine it changes the extension of these files to ._CRYPT and places a text file named !_READ_ME_!.txt in the same folder. In the text file the criminal tells the victims that the file has been encrypted and offers to sell them a decryptor:
«Your files are encrypted with RSA-1024 algorithm.
To recovery your files you need to buy our decryptor.
To buy decrypting tool contact us at: ********@yahoo.com»
In addition, after GPcode encrypts files, it also displays the message shown below:

In this case, Kaspersky researchers recommend that victims try to contact us using another computer connected to the Internet. DO NOT RESTART or POWER DOWN the potentially infected machine.

Kaspersky Lab offers some help:

Contact us by email at stopgpcode@kaspersky.com and tell us the exact date and time of infection, as well everything you did on the computer in the 5 minutes before the machine was infected:

∙ Which programs you have executed,
∙ Which websites you have visited, etc.

We'll try and help you recover any data that has encrypted.

Kaspersky Lab analysts are continuing to analyze the virus code in search of a way to decrypt the files without having the private key.

A New Way to Protect Computer Networks from Internet Worms

Scientists may have found a new way to combat the most dangerous form of computer virus.

The method automatically detects within minutes when an Internet worm has infected a computer network.

Network administrators can then isolate infected machines and hold them in quarantine for repairs.

Ness Shroff, Ohio Eminent Scholar in Networking and Communications at Ohio State University, and his colleagues describe their strategy in the current issue of IEEE Transactions on Dependable and Secure Computing.

They discovered how to contain the most virulent kind of worm: the kind that scans the Internet randomly, looking for vulnerable hosts to infect.

"These worms spread very quickly," Shroff said. "They flood the Net with junk traffic, and at their most benign, they overload computer networks and shut them down."

Code Red was a random scanning worm, and it caused $2.6 billion in lost productivity to businesses worldwide in 2001. Even worse, Shroff said, the worm blocked network traffic to important physical facilities such as subway stations and 911 call centers.

"Code Red infected more than 350,000 machines in less than 14 hours. We wanted to find a way to catch infections in their earliest stages, before they get that far," Shroff said.

The key, they found, is for software to monitor the number of scans that machines on a network send out. When a machine starts sending out too many scans -- a sign that it has been infected -- administrators should take it off line and check it for viruses.

The strategy sounds straightforward enough. A scan is just a search for Internet addresses -- what we do every time we use search engines such as Google. The difference is, a virus sends out many scans to many different destinations in a very short period of time, as it searches for machines to infect.

"The difficulty was figuring out how many scans were too many," Shroff said. "How many could you allow before an infection would spread wildly? You want to make sure the number is small to contain the infection. But if you make it too small, you'll interfere with normal network traffic."

"It turns out that you can allow quite a large number of scans, and you'll still catch the worm."

Shroff was working at Purdue University in 2006 when doctoral student Sarah Sellke suggested making a mathematical model of the early stages of worm growth. With Saurabh Bagchi, assistant professor of electrical and computer engineering at Purdue, they developed a model that calculated the probability that a virus would spread, depending on the maximum number of scans allowed before a machine was taken off line.

In simulations, they pitted their model against the Code Red worm, as well as the SQL Slammer worm of 2003. They simulated how far the virus would spread, depending on how many networks on the Internet were using the same containment strategy: quarantine any machine that sends out more than 10,000 scans.

They chose 10,000 because it is well above the number of scans that a typical computer network would send out in a month.

"An infected machine would reach this value very quickly, while a regular machine would not," Shroff explained. "A worm has to hit so many IP addresses so quickly in order to survive."

In the simulations pitted against the Code Red worm, they were able to prevent the spread of the infection to less than 150 hosts on the whole Internet, 95 percent of the time.

A variant of Code Red worm (Code Red II) scans the local network more efficiently, and finds vulnerable targets much faster. Their method was effective in containing such worms. In the simulations, they were able to trap the worm in its original network -- the one that would have started the outbreak -- 77 percent of the time.

Anywhere from 10 to 20 percent of the time, it spread to one other network, but no further. The remaining 3 to 13 percent of the time, it escaped to more networks, but the infection was slowed.

In all cases, there was a dramatic decrease in the spread of the worm within the first hour.

To use this strategy, network administrators would have to install software to monitor the number of scans on their networks, and would have to allow for some downtime among computers when they initiate a quarantine.

According to Shroff, that wouldn't be a problem for most organizations. Very small businesses -- ones with only a few servers -- may have more difficulty taking their machines off line.

"Unfortunately there is no complete foolproof solution," Shroff said. "You just keep trying to come up with techniques that limit a virus's ability to do harm."

He and his colleagues are working on adapting their strategy to stop targeted Internet worms -- ones that have been designed specifically to attack certain vulnerable IP addresses.

This work was supported by a grant from the National Science Foundation, and Sarah Sellke's NSF Graduate Fellowship.

60 Minutes: Pentagon's Raygun Demonstrated on Mock Protesters
David Edwards and Muriel Kane

The Pentagon has been developing a raygun which can harmlessly repel enemies by causing a burning sensation in the top layer of the skin. However, according to CBS's 60 Minutes, the military is unwilling to actually trust this weapon enough to deploy it in Iraq.

"We are now stepping into the Buck Rogers scenario," explained Colonel Kirk Hymes, who is in charge of testing the "Active Denial System" at Moody Air Force Base in Georgia.

Hymes demonstrated the weapon by staging what CBS somewhat oddly called "a scenario soldiers might encounter in Iraq" -- a handful of military volunteers, dressed as civilian protesters, who carried signs saying "peace not war" and threw objects at a small group of soldiers. A series of raygun blasts from half a mile away disrupted their chants and finally sent them running.

Assistant Secretary of the Air Force for Acquisiton Sue Payton calls the Active Denial System a "huge game-changer" which "would save huge numbers of lives." She told CBS, "It could be used to read someone's mind, in effect. ... If they continue to come at you, then you're fairly sure ... they're probably a terrorist or an adversary who wants to do you harm."

The Active Denial System was developed in secret for ten years before being unveiled by the Pentagon in 2001. As of 2004, it was being described as ready for use in Iraq within the next 12 months. This has still not occurred, and according to Secretary Payton, use of the weapon in Iraq is now "not politically tenable" because after Abu Ghraib "you don't ever, ever, ever want a system like this to be thought of as a torture weapon."

However, the failure to deploy the weapon as planned has raised suspicions that the real intention is to use it for domestic crowd control.

In 2006, Air Force Secretary Michael Wynne was quoted as saying that the device should be used first on Americans, because "if we're not willing to use it here against our fellow citizens, then we should not be willing to use it in a wartime situation. ... If I hit somebody with a nonlethal weapon and they claim that it injured them in a way that was not intended, I think that I would be vilified in the world press."

Raytheon, which developed the system for the Pentagon, is currently selling a more limited-range civilian version of the system, under the name "Silent Guardian," which it promotes as being suitable for "law enforcement, checkpoint security, facility protection, force protection and peacekeeping missions."

Commander Charles "Sid" Heal of the Los Angeles County Sheriff's Department, who advised Raytheon in developing the raygun, told CBS that the real reason the system has not been deployed in Iraq is "cowardice." Heal, a former Marine, took a variety of non-lethal weapons to Somalia in 1995 and was dismayed to find that his superiors felt their supposedly humanitarian mission was better accomplished by killing. He would love to have the Pentagon's raygun available for such purposes as controlling prison riots.

The Pentagon is spending just $13.1 million on the raygun this year. Secretary Payton agrees this is "absolutely peanuts ... chump change," but she explained to CBS that with only a $475 billion annual budget, "we don't have enough money to do things that are the here and now." The raygun is seen as unproven because it has never been deployed in the field, and it has not been deployed in the field because it is unproven.

"Lethal weapons have an easier time getting into our system," acknowledges Colonel Hymes.

It Isn’t Magic: Putin Opponents Are Made to Vanish From TV
Clifford J. Levy

On a talk show last fall, a prominent political analyst named Mikhail G. Delyagin had some tart words about Vladimir V. Putin. When the program was later televised, Mr. Delyagin was not.

Not only were his remarks cut — he was also digitally erased from the show, like a disgraced comrade airbrushed from an old Soviet photo. (The technicians may have worked a bit hastily, leaving his disembodied legs in one shot.)

Mr. Delyagin, it turned out, has for some time resided on the so-called stop list, a roster of political opponents and other critics of the government who have been barred from TV news and political talk shows by the Kremlin.

The stop list is, as Mr. Delyagin put it, “an excellent way to stifle dissent.”

It is also a striking indication of how Mr. Putin has increasingly relied on the Kremlin-controlled TV networks to consolidate power, especially in recent elections.

Opponents who were on TV a year or two ago all but vanished during the campaigns, as Mr. Putin won a parliamentary landslide for his party and then installed his protégé, Dmitri A. Medvedev, as his successor. Mr. Putin is now prime minister, but is still widely considered Russia’s leader.

Onetime Putin allies like Mikhail M. Kasyanov, his former prime minister, and Andrei N. Illarionov, his former chief economic adviser, disappeared from view. Garry K. Kasparov, the former chess champion and leader of the Other Russia opposition coalition, was banned, as were members of liberal parties.

Even the Communist Party, the only remaining opposition party in Parliament, has said that its leaders are kept off TV.

And it is not just politicians. Televizor, a rock group whose name means TV set, had its booking on a St. Petersburg station canceled in April, after its members took part in an Other Russia demonstration.

When some actors cracked a few mild jokes about Mr. Putin and Mr. Medvedev at Russia’s equivalent of the Academy Awards in March, they were expunged from the telecast.

Indeed, political humor in general has been exiled from TV. One of the nation’s most popular satirists, Viktor A. Shenderovich, once had a show that featured puppet caricatures of Russian leaders, including Mr. Putin. It was canceled in Mr. Putin’s first term, and Mr. Shenderovich has been all but barred from TV.

Senior government officials deny the existence of a stop list, saying that people hostile to the Kremlin do not appear on TV simply because their views are not newsworthy.

In interviews, journalists said that they did not believe the Kremlin kept an official master stop list, but that the networks kept their own, and that they all operated under an informal stop list — an understanding of the Kremlin’s likes and dislikes.

Vladimir V. Pozner, host of “Times,” a political talk show on the top national network, Channel One, said the pressure to conform to Kremlin dictates had intensified over the last year, and had not eased even after the campaign.

“The elections have led to almost a paranoia on the part of the Kremlin administration about who is on television,” said Mr. Pozner, who is president of the Russian Academy of Television.

In practice, Mr. Pozner said, he tells Channel One executives whom he wants to invite on the show, and they weed out anyone they think is persona non grata.

“They will say, ‘Well, you know we can’t do that, it’s not possible, please, don’t put us in this situation. You can’t invite so and so’ — whether it be Kasparov or Kasyanov or someone else,” Mr. Pozner said.

He added: “The thing that nobody wants to talk about is that we do not have freedom of the press when it comes to the television networks.”

Vladimir R. Solovyov, another political talk show host, said Mr. Pozner was complaining only because his ratings were down and he was looking for someone to blame if his program was canceled. Mr. Solovyov, a vocal supporter of Mr. Putin, said he had never been bullied by the Kremlin.

Yet last year, his show, “Throw Down the Gauntlet,” regularly featured members of opposition parties. This year, the only politicians to appear have been leaders of Mr. Putin’s party, United Russia, and an allied party.

Asked why he had not invited opposition leaders lately, Mr. Solovyov said: “No one supports them. They have nothing to say.”

Vladimir A. Ryzhkov, a liberal and former member of Parliament who used to appear on the show, said Mr. Solovyov was covering up for the Kremlin.

“He lies, of course,” Mr. Ryzhkov said. “My programs with him were among the highest rated programs of any in the history of his show.”

Mr. Ryzhkov said he was usually allowed to appear in lengthy segments on only one major channel: Russia Today, the English-language news station, which the Kremlin established to spread its viewpoint globally.

“I can go on Russia Today only because they want to make it seem that in Russia, there is freedom of the press,” he said.

After the Soviet Union’s fall, several national and regional networks arose that were owned by oligarchs. Though they operated with relatively few restrictions, their owners often used them to settle personal and business scores. One network, NTV, garnered attention for its investigative reporting and war dispatches from Chechnya.

Mr. Putin chafed at negative coverage of the government, and the Kremlin effectively took over the major national networks in his first term, including NTV. Vladimir Gusinsky, NTV’s owner, was briefly arrested and then fled the country after giving up the network. From that point on, executives and journalists at Russian networks clearly understood that they would be punished for resisting the Kremlin.

All the major national and regional networks are now owned by the government or its allies. And since the presidential election in March, neither Mr. Putin nor Mr. Medvedev has indicated any interest in loosening the reins.

“Our television is very often criticized,” Mr. Medvedev said in April. “They say it is boring, it is pro-government, it is too oriented towards the positions of state agencies, of those in power. You know, I can say that our television — in terms of quality, in terms of the technology used — is, I believe, one of the best in the world.”

Valery Y. Komissarov, a former host on a state channel who is now a governing party leader in Parliament, said television coverage was a convenient scapegoat for opposition politicians and antagonistic commentators.

“These are people who are not interesting for society, who are not interesting for journalists,” Mr. Komissarov said. “But they want publicity and perhaps they want to explain away their lack of creative and political success by the fact that they are persecuted, that they are included on the so-called stop list.”

While the Kremlin has focused on TV because it has by far the largest audience, many radio stations and newspapers also abide by the stop list, either ignoring or belittling the opposition.

There are exceptions: a few national and regional newspapers regularly publish critical news and commentary about Mr. Putin and comments from those on the stop list. In addition, the Internet is not censored, and contains plenty of criticism of the government.

A small national network, Ren TV, pushes the boundaries, as does a national radio station, the Echo of Moscow, which has become the voice of the opposition even though Gazprom, the government gas monopoly, owns a majority stake in it.

The Kremlin seems to tolerate criticism in such outlets because they have a limited reach compared with the major television networks. The nightly news on Channel One, for example, is far more popular than any of its counterparts in the United States. It regularly is one of top 10 most-watched programs in Russia.

Mr. Delyagin, the political analyst edited out of the talk show last fall, said he was surprised to have been invited in the first place. He said he last appeared on a major network several years ago, before he began attacking the Kremlin and supporting the opposition.

“I thought that maybe she forgot to look at the stop list,” he said, referring to the program’s host, Kira A. Proshutinskaya.

(Last week, after a Russian-language version of this article was posted on a blog run by the Moscow bureau of The New York Times, Mr. Delyagin was invited to appear on a show on NTV.)

Ms. Proshutinskaya’s program, “The People Want to Know,” had been censored before.

Mr. Ryzhkov, the liberal former member of Parliament, went on the show last year, but its network, TV Center, refused to broadcast it.

In an interview, Ms. Proshutinskaya conceded that Mr. Delyagin had been digitally erased from the program. She said she had been embarrassed by the incident, as well as the one with Mr. Ryzhkov, explaining that the network was responsible. The Kremlin had so intimidated the networks, she said, that self-censorship was rampant.

“I would be lying if I said that it is easy to work these days,” she said. “The leadership of the channels, because of their great fear of losing their jobs — they are very lucrative positions — they overdo everything.”

The management of her network would not comment. But the network’s news director, Mikhail A. Ponomaryov, said journalists and hosts of talk shows had no choice but to comply with the rules.

“It would be stupid to say that we can do whatever we want,” he said. “If the owner of the company thinks that we should not show a person, as much as I want to, I cannot do it.”

McCain: I'd Spy on Americans Secretly, Too
Ryan Singel

If elected president, Senator John McCain would reserve the right to run his own warrantless wiretapping program against Americans, based on the theory that the president's wartime powers trump federal criminal statutes and court oversight, according to a statement released by his campaign Monday.

McCain's new tack towards the Bush administration's theory of executive power comes some 10 days after a McCain surrogate stated, incorrectly it seems, that the senator wanted hearings into telecom companies' cooperation with President Bush's warrantless wiretapping program, before he'd support giving those companies retroactive legal immunity.

As first reported by Threat Level, Chuck Fish, a full-time lawyer for the McCain campaign, also said McCain wanted stricter rules on how the nation's telecoms work with U.S. spy agencies, and expected those companies to apologize for any lawbreaking before winning amnesty.

But Monday, McCain adviser Doug Holtz-Eakin, speaking for the campaign, disavowed those statements, and for the first time cast McCain's views on warrantless wiretapping as identical to Bush's.

[N]either the Administration nor the telecoms need apologize for actions that most people, except for the ACLU and the trial lawyers, understand were Constitutional and appropriate in the wake of the attacks on September 11, 2001. [...]

We do not know what lies ahead in our nation’s fight against radical Islamic extremists, but John McCain will do everything he can to protect Americans from such threats, including asking the telecoms for appropriate assistance to collect intelligence against foreign threats to the United States as authorized by Article II of the Constitution.
The Article II citation is key, since it refers to President Bush's longstanding arguments that the president has nearly unlimited powers during a time of war. The administration's analysis went so far as to say the Fourth Amendment did not apply inside the United States in the fight against terrorism, in one legal opinion from 2001.

McCain's new position plainly contradicts statements he made in a December 20, 2007 interview with the Boston Globe where he implicitly criticized Bush's five-year secret end-run around the Foreign Intelligence Surveillance Act.

"I think that presidents have the obligation to obey and enforce laws that are passed by Congress and signed into law by the president, no matter what the situation is," McCain said.

The Globe's Charlie Savage pushed further, asking , "So is that a no, in other words, federal statute trumps inherent power in that case, warrantless surveillance?" To which McCain answered, "I don't think the president has the right to disobey any law."

McCain's embrace of extrajudicial domestic wiretapping is effectively a bounce-back from Fish's comments, made at the Computers, Freedom and Privacy conference in Connecticut last month. When liberal blogs picked up the story that McCain had moved to the left on wiretapping, the McCain campaign issued a letter insisting that he still supported unconditional immunity, as well as new rules that would expand the nation's spy powers.

The campaign's response was consistent with McCain's past positions and votes. But it riled Andrew McCarthy at the conservative National Review Online, who read the campaign's position as a disavowal of Bush's warrantless wiretapping program, and a wimpy surrender of executive power to Congress.

"What does it mean when he says Sen. McCain does not want the telecoms put into this position again?" McCarthy asked. "Is he saying that in a time of national crisis, the president should not be permitted to ask the telecoms for assistance that is arguably beyond what is prescribed in a statute?"

That's when the campaign issued the letter explaining McCain's new views of executive power, and revealing that McCain would, in certain future circumstances, rely on the same theory of executive power in wartime.

A spokesperson for McCain's camp did not respond to a request Monday for an explanation of the difference between the new policy and the December interview.

Chávez Decree Tightens Hold on Intelligence
Simon Romero

President Hugo Chávez has used his decree powers to carry out a major overhaul of this country’s intelligence agencies, provoking a fierce backlash here from human rights groups and legal scholars who say the measures will force citizens to inform on one another to avoid prison terms.

Under the new intelligence law, which took effect last week, Venezuela’s two main intelligence services, the DISIP secret police and the DIM military intelligence agency, will be replaced with new agencies, the General Intelligence Office and General Counterintelligence Office, under the control of Mr. Chávez.

The new law requires people in the country to comply with requests to assist the agencies, secret police or community activist groups loyal to Mr. Chávez. Refusal can result in prison terms of two to four years for most people and four to six years for government employees.

“We are before a set of measures that are a threat to all of us,” said Blanca Rosa Mármol de León, a justice on Venezuela’s top court, in a rare public judicial dissent. “I have an obligation to say this, as a citizen and a judge. This is a step toward the creation of a society of informers.”

The sweeping intelligence changes reflect an effort by Mr. Chávez to assert greater control over public institutions in the face of political challenges following a stinging defeat in December of a package of constitutional changes that would have expanded his powers.

Mr. Chávez, who has insisted the defeat will not dampen his ambitions to transform Venezuela into a Socialist state, said the new law was intended to guarantee “national security” and shield against “imperialist attacks.”

He lashed out at its critics as being agents of the “empire,” meaning the United States.

The law’s stated aim of protecting Venezuela follows a history of antagonism between the governments in Caracas and Washington, dating at least from the Bush administration’s tacit support for a short-lived coup against Mr. Chávez in 2002.

Recently, Venezuela has claimed it was subject to military intimidation from the United States, pointing to a recent violation of Venezuelan airspace by an American fighter jet and Washington’s recent reactivation of its Fourth Fleet to patrol Latin American and Caribbean waters.

On Sunday, Mr. Chávez referred to critics of the intelligence law as de facto supporters of the Bush administration and of the Patriot Act, the American antiterrorism law that enhances the ability of security agencies to monitor personal telephone and e-mail communications.

Mr. Chávez’s new intelligence law has similar flourishes. For instance, it authorizes his new intelligence agencies to use “any special or technically designed method” to intercept and obtain information.

But the new law may also point to the influence of Cuba, Venezuela’s top ally, on intelligence policies. For instance, the use of community-monitoring groups to assist in gathering intelligence resembles Cuba’s use of neighborhood Committees for the Defense of the Revolution to report on antigovernment behavior.

“This is purely Cuban-style policy,” Juan José Molina, a legislator with Podemos, a leftist party that broke from Mr. Chávez’s coalition last year, said of the new intelligence law. “Our rulers want to impose old models upon us.”

Interior Minister Ramón Rodríguez Chacín announced the intelligence overhaul in a public appearance here last week, saying it was needed to combat “interference from the United States” by having intelligence agency workers imbued with “ideological commitment.”

On Monday, however, Mr. Rodríguez Chacín softened his tone, saying the law would not lead to political intimidation or restrict freedom of expression. “We are talking about the responsibility all Venezuelans have with the security of the state and the resolution of any crime,” he said.

The drafting and passage of the law behind closed doors, without exposing it to the public debate it would have had if Mr. Chávez had submitted it to the Assembly, also contributed to the public uproar and suspicion.

One part of the law, which explicitly requires judges and prosecutors to cooperate with the intelligence services, has generated substantial concern among legal experts and rights groups, which were already alarmed by the deterioration of judicial independence under Mr. Chávez.

While the language of this passage of the law, and several others, is vague, legal experts say the idea is clear: justice officials, including judges, are required to actively collaborate with the intelligence services rather than serve as a check on them.

“This is a government that simply doesn’t believe in the separation of powers,” said José Miguel Vivanco, Americas director for Human Rights Watch, the New York-based rights organization. “Here you have the president legislating by decree that the country’s judges must serve as spies for the government.”

Mr. Chávez’s opponents here grasped for reasons as to why he chose this moment for the intelligence overhaul, with his government grappling with economic problems like climbing inflation and slowing economic growth even as the price of oil, the lifeblood of Venezuela’s economy, remains near record levels.

“Even within the Bolivarian movement, this would officialize Soviet- and Cuban-style purges, accusing dissidents of being spies, traitors or agents of the imperialist enemy,” El Nacional, a normally staid opposition newspaper, said in an editorial that ended, “This is revolting.”

In some ways, the changes would merely refine the control Mr. Chávez already exerts over intelligence operations. His government has already used voter registration data to purge employees deemed disloyal to the president from the intelligence agencies and other parts of the civil service.

Several legal activists said Monday that they were studying ways to appeal the law, but the viability of a legal challenge remains unclear.

“This is the most scandalous effort to intimidate the population in the 10 years this government has been in power,” said Rocío San Miguel, a prominent legal scholar who heads a nongovernmental organization that monitors Venezuelan security and defense issues.

Ms. San Miguel said information her group had collected could be deemed illegal under the new law. The group has data from military sources showing that Mr. Chávez’s efforts to create a force of one million reservists had fallen far short.

“Under the new law, this information could be considered a threat to national security and I could be sent immediately to jail,” she said. “Effectively this is a way to instill fear in NGOs and news organizations and parts of society that remain outside the government’s reach.”

World+dog Ignores Sweden's Draconian Wiretap Bill

'If your email crosses our border, we tap it'
Dan Goodin

Sweden is on the verge of passing a far-reaching wiretapping program that would greatly expand the government's spying capabilities by permitting it to monitor all email and telephone traffic coming in and out of the country.

So far, hacks from the mainstream Swedish press seem to be on holiday, so news about the proposed law is woefully hard to come by. That leaves us turning to this summary from the decidedly partisan Swedish Pirate Party for details. We'd prefer to rely on a more neutral group, but that wasn't possible this time. According to them, here's a broad outline:

The En anpassad försvarsunderrättelseverksamhet bill (which loosely translates to "a better adapted military intelligence gathering") gives Sweden's National Defence Radio Establishment (FRA) direct access to the traffic passing through its borders. Now remember, we're talking about the internet, which frequently routes packets though multiple geographically dispersed hops before they reach their final destination.

This all but guarantees that emails and voice over IP (VoIP) calls between Swedes will routinely be siphoned into a massive monitoring machine. And we wouldn't be surprised if traffic between parties with no tie to the country regularly passes through Sweden's border as well, and that too would be fair game. (For example, email sent from a BT address in London to Finland is likely to pass through Sweden first.)

Once intercepted, the data will be searched for certain keywords, and those that contain the words will be pulled aside for additional scrutiny. A broad array of organizations will have use of the system, including the Department of Transportation, the Department of Agriculture, the police, secret service and customs, and in some cases major businesses. The bill allows Swedes to be singled out, as well.

When the bill was introduced in early 2007, Google was reportedly so concerned about its consequences for privacy that it threatened to limit its ties to the country if the measure passed.

"We have contacted Swedish authorities to give our view of the proposal and we have made it clear that we will never place any servers inside Sweden's borders if the proposal goes through," Peter Fleischer, Google's global privacy counsel, said last year, according to this article. "We simply cannot compromise our users' integrity by allowing Swedish authorities access to data that may not even concern Swedish activity."

But so far, few outside of the pro-privacy universe have bothered to discuss the bill this time around. There have been no similar pronouncements from Google and representatives there didn't respond to a request for comment. The Electronic Frontier Foundation has likewise been reticent about the bill.

"Surprisingly enough, there hasn't been that much written about it, even in the Swedish media," said Patrik Runald, a Swedish national and a security response manager for F-Secure who works in San Jose, California.

"The funny thing is when asked what do you want to look for, [backers of the bill] don't really specify what they're interested in," he continued. "It's a very broad bill. They basically can interpret whatever they like."

One of the few recent press mentions of the bill came from a publication called Cellular News in London. According to this story, Nordic and Baltic telecommunications provider TeliaSonera planned to move email servers out of Sweden to protect the privacy of its Finnish customers.

The bill is scheduled to come up for a vote on June 17. According to the Swedish Pirate Party, a majority of parliament currently backs the bill.

Sonera Moves Email Servers to Avoid Swedish Spy Laws

Sonera's Finland operations has confirmed that it is upgrading its customer e-mail system and plans to move its customers' e-mail services back to Finland at the end of April. At present, the servers are running on TeliaSonera's shared e-mail platform in Sweden.

"We decided to move Sonera's e-mail services back to Finland in order to protect the privacy of our Finnish customers. After the migration, e-mails sent from one Finn to another will not cross Finland's borders at any stage. At the same time, we were able to modernize our entire e-mail environment, thanks to which we are now better prepared for various types of failures," says Juha-Pekka Weckström, Senior Vice President of TeliaSonera Broadband Services Finland.

The removal is driven by the Swedish government's proposed law which would allow the National Defence Radio Establishment to intercept all electronic communications passing the national border.

In total, the number of email boxes to be transferred is approximately 500,000 of which 450,000 are used by private customers and 50,000 by business customers. For Sonera's private broadband customers, the e-mail service is available at no charge.

Increased mailbox size

Later this spring, Sonera will increase the size of its private customers' e-mail boxes in response to customer wishes. The standard mailbox size will be 500 MB, and an additional 500 MB is available for an extra charge. Those with a separately purchased communications package will have a mailbox size of 3 GB, which can also be upgraded by 500 MB for a fee. Sonera's broadband customers can create up to 5 mailboxes free of charge. Customers' e-mail addresses remain unchanged.

Data Retention Effectively Changes the Behavior of Citizens in Germany

A new survey shows that data retention laws influence the actual behavior of citizens in Germany. 11% had already abstained from single telecommunication acts, 52% would not use phone or e-mail for confidential contacts.

The problem with surveillance is not primarily that some bored officer might learn about some embarrassing private detail (although this is a problem as well). The fundamental problem with surveillance is that it changes people. People under surveillance behave differently than people who are not monitored - differently than free people.

Unfortunately, this fundamental problem has just been proven in Germany. Since the beginning of this year, communication providers are required to record who communicated with whom and when (but not the content of the communication). This data is stored for six months and available to law enforcement in cases related to certain forms of crime.

A recent survey (German) by the well-known German Forsa institute now showed the social effects of this data retention law: Communication habits are indeed changing.

1.003 individuals have been questioned on May 27th and 28th. These are the results:

• 73% know about the data retention
• 11% said that they had already abstained from using phone, cell phone or e-mail in certain occasions
• 6% believe to receive less communication since the beginning of the data retention
• 52% said they probably would not use telecommunication for contacts like drug counselors, psychotherapists or marriage counselors because of data retention

And the sad fact: 48% still think that data retention is a necessary step for crime prevention.

"The deterring effects of this law is life threatening, for example if people do not call a drug counselor or psychotherapist" claims Patrick Breyer of Arbeitskreis Vorratsdatenspeicherung, a network of civil rights and privacy activists.

Thomas Dreesen of the association of German specialized journalists is also worried: “Against the background of [the abuse of communication data by Germany’s largest telephone provide] it is obvious how easily such data can be abused to spy out journalists and expose whistle blowers. The law […] therefore threatens the freedom of press in Germany”

The study was commissioned by Arbeitskreis Vorratsdatenspeicherung [a network of civil rights and privacy activists], , eco [German ISP and Internet Association], Deutscher Fachjournalisten-Verband [German association of specialized journalists] and JonDos GmbH [an anonymizer company].

Cellphone Tracking Study Shows We’re Creatures of Habit
John Schwartz

News flash: we’re boring.

New research that makes creative use of sensitive location-tracking data from 100,000 cellphones in Europe suggests that most of us can be found in just a couple of locations at any time, and do not generally go beyond a few miles of home.

“Individuals display significant regularity, because they return to a few highly frequented locations, such as home or work,” the researchers found.

That might seem like science and mountains of data being marshaled to prove the obvious. But the researchers say their work, which also shows that people exhibit similar patterns whether they travel long distances or short ones, could open new frontiers in fields like disease tracking and urban planning.

“Slices of our behavior are preserved in these electronic data sets,” said Albert-László Barabasi, an author of the project and the director of the Center for Complex Network Research at Northeastern University. “This is creating huge opportunities for science.”

The researchers said they used the potentially controversial data only after any information that could identify individuals had been scrambled. Even so, they wrote, people’s wanderings are so subject to routine that by using the patterns of movement that emerged from the research, “we can obtain the likelihood of finding a user in any location.” .

The researchers were able to obtain the data from a European provider of cellphone service under antiterrorism rules that require all such companies to preserve call and location information. The researchers did not disclose the country the provider operates in.

Scientists have long wondered how to measure something as ephemeral as movement. If general rules and algorithms of people’s wanderings could be discerned, they could be used to create computer models for understanding emergency response, urban planning and the spread of disease, say the authors, whose work appears in the new edition of the journal Nature.

Previous attempts to find data that can shed light on the movement of large groups of people have used complex formulas to predict behavior. But more recent attempts have involved the search for data in a seemingly unrelated area that might shed light on movement.

One such paper, by Dirk Brockmann, a professor of physics at Northwestern University, tracks dollar bills as a surrogate for the movement of people, and found similar routines of movement that also resemble those of animal foraging.

The cellphone researchers pointed out that the new paper moved the field forward significantly because people hold on to their phones, and so the movement of individuals is more closely tracked than it can be with dollar bills that are passed from person to person. As the researchers put it in the paper, “dollar bills diffuse, but humans do not.”

Both lines of research, however, suggested that people do not really move around much.

Dr. Brockmann, who was a reviewer on the new paper, said he first approached it with some trepidation — “I said, ‘Oooh, I hope this does not completely falsify what we found.’ ” Instead, he found, “I was very happy to see that it was consistent with what we found, even though the patterns of travel were obtained by very different sets of data.”

As he put it, “the majority of people travel much less than that minority that travels a lot.”

But the new research, he added, gives greater insight into the movement of individuals while his tracks the flow of larger populations.

Dr. Brockmann said that the Nature paper should have said in which country the research was conducted, because geography could affect the statistics. A long and thin country like Sweden can require trips of distances that differ from, say, those in Germany. But he said new research he is gathering suggests that despite those differences, the patterns of wandering along the various scales “are quite universal.”

The use of cellphones to track people, even anonymously, has ethical implications, said Arthur Caplan, director of the Center for Bioethics at the University of Pennsylvania.

“This research is very controversial, ethically,” he said. While researchers are generally free to observe people in public places without getting permission from them or review from institutional ethics boards, he said, “your cellphone is not something I would consider a public entity.”

“A cellphone is a personal possession to me,” he said, “not a tracking device.”

Congress May OK 'Compromise' Bill to Derail Spying Lawsuits
Anne Broache

The U.S. Congress may soon vote on a new "compromise" spy law that would still likely derail pending suits against AT&T and other companies accused of opening their networks to the government in violation of wiretap law.

Democratic leaders, facing intense election year pressure from Republicans and more conservative "Blue Dog" members of their own party, had said they hoped to reach an agreement on a contentious rewrite of a 1978 electronic-surveillance law known as the Foreign Intelligence Surveillance Act, or FISA, before their Memorial Day recess.

That self-imposed deadline passed without action. The major sticking point has been whether to grant so-called retroactive legal immunity to telephone companies facing lawsuits over allegations that they illegally assisted the National Security Agency, violating their customers' privacy.

The latest proposal, which Republicans are touting as a "compromise," would shift that debate behind closed doors, allowing a secret court to dismiss lawsuits related to the president's warrantless-wiretapping program--that is, during the period after the Sept. 11 attacks and before then-Attorney General Alberto Gonzales agreed to submit the so-called Terrorist Surveillance Program to the same secret court for review.

In order to dismiss the suits, the secret Foreign Intelligence Surveillance Court, whose 11 judges are appointed by the U.S. Supreme Court's chief justice, would be required only to consider whether the attorney general's "certification" requesting surveillance assistance from a communications company was terrorism-related and legally authorized by the president. That's according to a draft proposal and summary provided by Sen. Kit Bond (R-Mo.)'s office and discussed at a press conference last week.

"It's clear that they're giving (the provisions) nice titles, and Bond is suggesting that he's made a lot of concessions, but ultimately, the way the provisions work out is, the administration gets what it wants," Caroline Fredrickson, director of the ACLU's Washington office, said in a phone interview. "The immunity provision is garbage."

Critics--including the American Civil Liberties Union and the Electronic Frontier Foundation, which have filed legal challenges against the surveillance activities--say that would amount to a rubber stamp of sorts on any past warrantless eavesdropping.

Aides to Democratic leaders told CNET News.com that their bosses are reviewing the proposal and haven't yet taken a position on it. But civil-liberties groups say they fear that, thanks to political pressure, they will ultimately accept much what they call a "sham" compromise.

The White House and Republicans, of course, have preferred all along to give more blanket "retroactive" immunity to telephone companies. Earlier this year, they appeared poised to get their way, when the U.S. Senate voted to approve a bill that likely would have wiped out scores of pending legal challenges against the likes of AT&T and Verizon Communications.

But the House of Representatives ultimately objected to that approach and refused to call up that bill for a vote, opting instead to narrowly approve a version lacking so-called "retroactive immunity" for phone and Internet companies accused of wrongdoing.

The "compromise" this time around appears to involve a couple of things: Outside parties challenging the government's warrantless surveillance would be allowed to submit briefs to the secret court. There would also be an arguably lower legal standard than in the already-approved Senate bill for when court would be allowed to review the attorney general's "certifications," though civil-liberties groups said it's unclear exactly how that will work in reality.

Under the revised proposal, the secret court would also have the option of sending a legal challenge back to a regular federal court, if it--and a subsequent secret appeals court--determines the case against a phone company should not be dismissed.

There's no guarantee, however, that such a move, if it even occurred, would not result in the federal court simply throwing out the case itself. After all, appeals courts have already dismissed similar suits on the grounds that state secrets would be revealed.

And throughout it all, a good amount of secrecy would be required under the revised bill. For instance, the secret court would be prohibited from disclosing how or why it reached a particular conclusion about whether to dismiss a case, if the attorney general declared that such revelations would harm "national security."

What remains unclear is what happens next. House Majority Leader Steny Hoyer said he now hopes to call up a compromise bill for a vote sometime before Congress departs for its August recess. Hoyer has also said "differences" remain to be worked out among their versions, but it wasn't immediately clear what those differences are, as a Hoyer representative didn't immediately respond to requests for elaboration.

Democrats, meanwhile, insisted again that intelligence agents aren't hamstrung by the lack of legal changes so far.

"Our intelligence community has the tools it needs to keep America safe, and we are absolutely committed to ensuring that this remains the case," Hoyer said. "The Director of National Intelligence has not informed us of any degradation in intelligence collection, and we continue to call on him to inform Congress if this changes."

WARGAMES and the Great Hacking Scare of 1983
Christopher Knight

Yesterday was the 25th anniversary of the release of WarGames, starring Matthew Broderick and Ally Sheedy. AMC was running it last night and I wound up watching a good part of it.

In case you've never seen it before, WarGames is about David Lightman, a high school student who's an unmotivated slacker in class but a first-rate computer hacker at home. David's real talent is running automated searches for systems that can be dialed into via phone modem, and then cracking their security. While trying to locate a new video game company's system so he can do his own brand of beta-testing, David unknowingly winds up accessing a computer at NORAD and nearly starts World War III from his bedroom.

A quarter-century later, WarGames still holds up extremely well. Practically all of the technology depicted is now horribly dated (look at the size of those floppies that David is using!) but in spite of that, and perhaps even because of it, WarGames has become a curiously good snapshot of both Cold War bunker mentality and the introduction of computers into civilian life. It is also, I believe, one of the more successful morality tales about the fear of nuclear war: WarGames is not a "political" film as many of the time were. And neither does it make anyone out to be "the good guys" and "the bad guys". The genius of WarGames's longevity is that it wisely adheres to its own lesson: that to win the game, sometimes you have to choose not to play the game at all.

I thought that WarGames also merited mentioning (in addition to it being a terrific film) because of the reaction that it engendered upon its release. With its depiction of teens hacking into school systems to change their own grades, and then breaking into military-grade mainframes and coming a hair's-breadth from nuking the whole planet, WarGames initiated unusual paranoia in the mainstream press about the power of computers. I remember one CBS Evening News report at the time that seriously questioned whether parents should allow their children to access the outside world via their personal computers at home. A magazine article suggested that computer modems be "locked up" just like firearms, to keep them out of the reach of teenagers. I even heard one pundit proclaim that there was no need for regular people to be able to log in to a remote system: that if you need to access your bank account, a friendly teller was just a short drive away.

And Bill Gates once declared that the average person would never have a need for more than 640 kilobytes of memory in a personal computer, too.

Such news stories were very fashionable in 1983, and looking back I think the corporate media unwittingly demonstrated the moral of WarGames. It was an unfounded fear but the press played on it, and it wound up embedding itself into the popular conscience. I know of one friend whose parents were so horrified at the prospect of "accidentally" breaking into an unauthorized computer system, that they didn't buy a computer at all until 1998! After their fears were allayed, they eventually got on the Internet and found that it was a fine thing.

Now to be fair, WarGames was not the first movie about computers going awry and driving mankind toward nuclear apocalypse. 1970's Colossus: The Forbin Project might have been the first to explore the theme, and of course there as also The Terminator. Many will convincingly argue that Dr. Strangelove had them all beat.

But WarGames was different: it wasn't only a computer glitch in a far-removed system or a demented military officer which we had to fear could doom all mankind. After WarGames, we were told that Jack D. Ripper could be anybody.

I don't know if the paranoia was completely without merit, though, but only because of one funny incident that happened to me. In the fall of 1994 I was using my first real computer to dial into various bulletin board systems, and there was one that had just started up in Eden. I tried to dial into it but instead of a computer I heard a voice telling me that "This number is not in service". I changed one digit in the prefix, thinking that maybe it was just the wrong number that I had been given. This time the modem did connect to another one, but the terminal window filled with gibberish. I changed the modem protocol, tried it again... and found that I had dialed into the computer system for the Eden branch of NationsBank (now Bank of America)! What was the first thing that popped into mind? Yup: WarGames. I hit the disconnect button so fast that I can still remember my heart pounding against my rib cage.

A few months after WarGames came out CBS began airing Whiz Kids, about a group of teenagers who built their own supercomputers and used it to solve crimes, and by that time the Great Hacking Scare of 1983 was in full swing. CBS execs were quick to emphasize that what the Whiz Kids characters did could not easily be pulled off in real life (which might have backfired: Whiz Kids had great potential but it was canceled after one season). The fear had pretty much diminished by 1987 when ABC's Max Headroom (a groundbreaking show that I've long thought has never been fully appreciated) came out, but it would still rear its head in the years to come, particularly with movies like 1992's Sneakers and Hackers in 1995. And then the success of Independence Day in 1996 finally turned the tables on the mistrust of computers as a tool. Suddenly hacking was not something that we worried would destroy the world: it could even save the world if it had to.

But for a long time, beginning in those strange days of 1983, there was a hesitancy to reach out and harness the computer: just as early man no doubt originally feared the flame. WarGames clearly announced that the digital fire, originally the province of the technology gods, was now a boon to mere mortals. And with it came a choice: we could use it to build, or to burn.

I like to believe that we have generally chosen the former.

'Fair Use' Stipulation Planned for Intellectual Property
Yasukazu Akada

The government will ease its stringent restrictions on using copyrighted works, a development that will affect activities ranging from posting personal pictures on websites to developing Internet search engines, sources said.

The Intellectual Property Strategy Headquarters, led by Prime Minister Yasuo Fukuda, has decided to make a Japanese version of a U.S. copyright law stipulation that allows for the "fair use" of copyrighted works for criticism, analyses, media reporting and research.

The decision was made to make it easier for venture companies to start new businesses, such as developing a rival to Google. The government intends to revise the Copyright Law to include a fair use stipulation as early as next year.

The current Japanese Copyright Law, in principle, prohibits any copying of other people's works or distributing them on the Internet without permission.

Exceptions to the law are copying works for personal use at home or for use in schools.

The planned stipulation will largely follow the one under the U.S. copyright law, which bases fair use on certain factors, including: whether the use of works is intended for commercial purposes; and whether the use of works influences the market of those works.

The Japanese stipulation will also contain the condition that the use of other people's works must not unfairly hurt the interests of the copyright holders, the sources said.

The current Copyright Law is sweeping in its application. For example, blogs featuring holiday photos of authors posing with anime characters in amusement parks could constitute a violation of the law. That is because the law does not have a specific stipulation that allows such use.

In addition, the creation of parodies based on other people's works could also be considered a violation.

Those activities could be regarded as legal under the fair use stipulation.

Archive services that copy and store information on websites could also become legal under the revised law, allowing companies to start up such businesses, the sources said.

The Intellectual Property Strategy Headquarters will agree to consider the fair use stipulation in its "intellectual property promotion plan 2008" next month. After that, a study panel will discuss the issue.

Overstock.com Sues New York State Over New Online Sales-Tax Law

Overstock.com, the online seller of excess inventory, sued New York state over a new law requiring more Web retailers to collect sales tax on shipments to residents in the state. The suit, filed Friday in state Supreme Court in Manhattan, challenges the constitutionality of a statute requiring Web companies with no physical presence in New York to collect taxes. Salt Lake City-based Overstock.com seeks a court order declaring the statute unconstitutional.

Ben Stein Wins Right to Use Lennon's 'Imagine'
David Kravets

A federal judge on Monday freed the producers of a movie promoting intelligent design to continue using a 15-second recording of John Lennon's "Imagine."

A New York judge said the makers of Expelled had a right of fair use under copyright law to use a small portion of the work without Yoko Ono's permission. Ono, the wife of the late Beatle, brought the case in April, saying the movie's credits made it appear she had licensed the song to the movie.

"Internet 'bloggers' immediately began accusing Mrs. Lennon of 'selling out' by licensing the song to defendants," according to the complaint filed in April in U.S. District Court for the Southern District of New York.

About 65 minutes into the 99-minute movie, lyrics "nothing to kill or die for, and no religion too" appear on the screen to the backdrop of music from the song. Premise Media, the producer of Expelled, critiqued the song and said such an idea could result in dictatorship.

"They put the song to a different purpose, selected an excerpt containing the ideas they wished to critique, paired the music and lyrics with images that contrast with the song's utopian expression, and placed the excerpt in the context of a debate regarding the role of religion in the public life," U.S. District Judge Sidney H. Stein wrote (.pdf) Monday.

Ono, who sued along with Lennon's sons Julian, Sean and EMI Blackwood Music, sought to have the song removed from future releases and the recall of all others.

The show's producers say it examines the scientific community's academic suppression of those who ask provocative questions about the origin and development of life. The movie is narrated by Ben Stein, a well-known actor and writer and consists principally of Stein's interviews with various proponents of intelligent design and defenders of Darwinian evolution.

The show was released in the United States on April 18 and within a month generated some $7.2 million in box office sales, and is to be released in Canada soon.

Supreme Court Rejects Fantasy Baseball Dispute
Anne Broache

Major League Baseball has struck out in its attempt to get the U.S. Supreme Court to intercede in a fantasy baseball dispute.

The justices on Monday said they won't take up MLB's challenge, backed by the National Football League Players Association, of prior court rulings favoring a fantasy league company. The announcement came without comment in a standard list of case statuses published by the high court.

MLB's Internet media arm, later joined by the pro-baseball players' union, had claimed that C.B.C. Distribution and Marketing--a Missouri company that sells fantasy sports products via the Web, e-mail, regular mail, and phone--was using baseball players' names and statistics without a license, thereby violating the players' rights to publicity under state intellectual property laws. (A right to publicity, of course, is a person's right to control and profit from the commercial use of his name and likeness.)

The original lawsuit actually came from C.B.C. The company sued MLB after the pro baseball association began providing fantasy baseball games on its own Web site. MLB offered C.B.C. a license only to promote MLB's products, not to continue selling its own fantasy baseball games. Fearing a lawsuit from MLB if it continued business as usual, C.B.C. filed its own suit.

C.B.C. won at the district court level and again last year at the appeals court level, which held that the company's "first amendment rights in offering its fantasy baseball products supersede the players' rights of publicity."

Record Companies Call for Baidu Boycott Over Piracy Issues
Aaron Back

Chinese and international record companies called Tuesday for an advertiser boycott of Baidu.com Inc. the country's leading search engine by search volume, over complaints of music piracy.

"Resolutely countering Baidu, which is the largest and most incorrigible purveyor of pirated music in China, has become a common goal in China," the companies said in a joint statement with industry associations including the Music Copyright Society of China and the International Federation of the Phonographic Industry.
The statement was signed by record companies including Universal Music Group, EMI Group PLC, Sony BMG Entertainment, Warner Music Group Corp., and local Chinese companies.

The group of companies and associations has sent a letter to advertising companies asking them "to carefully consider whether they should continue to place advertisements on pirating media," the statement said.

Baidu's search engine provides links to thousands of sites that carry unlicensed copies of music. Record companies have filed a series of lawsuits against the site in Chinese courts.

Baidu has said it pays great attention to protecting intellectual property rights and follows Chinese law. It has also said it is testing advertisement-supported music downloads with companies including EMI Group.

In addition, Chinese music distribution company R2G said it filed a new lawsuit against Baidu in a Beijing court on May 16th, alleging Baidu hasn't acted on legal notices related to the Web site links.

A Baidu spokeswoman said she hadn't seen the statement and declined to comment further.

How to Fit 1TB of Data on One Tiny Thumbdrive

New memory better, cheaper and more efficient than flash

Scientists at Arizona State University have created a new kind of solid state memory that they say is much cheaper and more efficient than flash. And crucially, because it uses a new kind of nanotechnology, storage capacities will be much higher than anything we have today, for a tenth of the cost.

The new memory is called programmable metallization cell (PMC) and one terabyte (1TB) USB thumbdrives are said to be just a few years away. The largest commercially available flash drives today are only 32GB in size - 30 times smaller and very pricey.

Smaller, better than flash

The new memory uses nano tech to charge copper particles on the molecular scale, making it 1,000 times more energy efficient as current flash memory. This bodes well for use in portable devices like phones and iPods.

"A thumb drive using our memory could store a terabyte of information," Michael Kozicki, director of ASU's Center for Applied Nanoionics, told Wired magazine. "All the current limitations in portable electronic storage could go away. You could record video of every event in your life and store it."

For the last eight years, the density of flash memory has halved, meaning that capacities have doubled every twelve months. But now flash memory is reaching its physical limitations, so this new memory could be stepping in at the crucial time.
SSDs set for boom?

The new memory could also be the answer for computer manufacturers who want to incorporate solid state hard drives but can't due to limitations of size and cost.

Wired says that PMC memory works in a vastly different way to current flash technology.

Flash uses electronic charges to physically store bits of information, whereas PMC works on the molecular scale to create nanowires from copper atoms. These nanowires record binary ones and zeroes, enabling a massive amount of data to be stored in a tiny space.

If a positive charge is passed through the PMC memory, the nanowires disassemble, allowing it to be used over and over again.

The first PMC memory chip is slated to go into production in April 2009.

Intel Said to Face Antitrust Investigation
Stephen LaBaton

The Federal Trade Commission has opened a formal antitrust investigation of Intel, the world’s largest maker of computer microprocessors, for anticompetitive conduct, government officials and lawyers involved in the proceeding said Friday.

The officials and lawyers said that in recent days Intel, its smaller rival Advanced Micro Devices, and several of the world’s largest personal computer makers that buy semiconductors from the two companies have begun to receive subpoenas from the commission.

The investigation into accusations that Intel’s pricing policies have been designed to maintain a near-monopoly on the microprocessor market was authorized by William E. Kovacic, the new chairman of the trade commission, and has the support of the agency’s other commissioners.

It reversed a decision by his predecessor, Deborah P. Majoras, who had been blocking the formal inquiry for many months, frustrating other senior commission officials and some lawmakers on Capitol Hill.

Ms. Majoras is a former senior official in the antitrust division at the Justice Department who was an architect of the Bush administration’s antitrust settlement with Microsoft in 2001. She stepped down two months ago to become the general counsel at Procter & Gamble.

In a statement on Friday, Intel acknowledged that it had received a subpoena on Wednesday and said that it had been “working closely” with the trade commission on a less formal review that had been under way since 2006. The company said it would cooperate with authorities.

“The company believes its business practices are well within U.S. law,” the statement said. “The evidence that this industry is fiercely competitive and working is compelling.”

An A.M.D. spokesman, Mike Silverman, said the company would have no comment.

Intel shares were down about 2.7 percent in afternoon trading.

Since it will almost certainly be many months before the commission decides whether to make a case against Intel, as European and Asian regulators have already done, the investigation could mark an important early test for the next administration on antitrust and competition policy.

Technically independent of the White House, the trade commission is led by appointees of the president. An administration seeking to show that it is more vigorous on antitrust policy than the Bush administration could use the Intel investigation to lay down an early marker.

A.M.D. has waged a global legal and public relations campaign against Intel hoping to persuade American and foreign regulators that Intel’s pricing practices violate antitrust laws.

The fight between the two — over a market that generates revenue of more than $225 billion a year — is among the largest antitrust matters pending before American and foreign regulators, and is considered to be among the most important since the antitrust cases brought against Microsoft in the 1990s.

Though Intel and A.M.D. are based in California — and their largest customers are American computer and equipment makers — A.M.D.’s complaints have received considerably more traction abroad.

This week, the Korean Fair Trade Commission said it would order Intel to pay more than $25 million for violating its fair trade laws. The Korean commission found that Intel violated antitrust law when it offered $37 million in rebates to the personal computer makers, Samsung Electronics and the Trigem Company, from 2002 to 2005 in return for a pledge not to buy microprocessors from A.M.D. Intel responded by saying it was disappointed with the decision and would probably appeal.

Lawyers involved in the proceedings say they expect that European regulators will expand their statement of objections, or official charge sheet, against Intel. Last year, the European Commission said the company had engaged in anticompetitive conduct by providing rebates to customers that limit their business with rivals and by paying computer makers to either delay or cancel the release of products that used A.M.D. microprocessors.

The European complaint said that Intel had abused its market dominance “with the aim of excluding its main rival from the market.” The complaint was the culmination of a six-year investigation.

Intel’s pricing practices are also being reviewed by investigators working for the New York attorney general Andrew M. Cuomo.

And A.M.D. has sued Intel in Federal District Court in Delaware. As a result of the crushing amount of evidence being gathered by both sides, a special master in that case this week delayed the start of the trial to early 2010. The trial had originally been scheduled for next spring.

Intel, which was founded by engineers who both developed the chip and made repeated innovations that made it smaller and more powerful, controls 80 to 90 percent of the microprocessor market. American antitrust law permits a company to hold a monopoly, but it forbids a company from leveraging its dominance to restrict competition.

A.M.D. has asserted that Intel offers rebates and discounts that, in effect, result in its chips being sold at prices below the cost of production, a practice that some courts in cases involving other companies have said can be a violation of antitrust law.

Intel denies that its discounts and rebates drive its prices below cost, or at predatory levels. Intel has said that it offered legitimate discounts based on the volume of chips that have been purchased by companies, and that consumers benefit when personal computer manufacturers — using the discounts — are able to lower the cost of making their products.

Intel executives have also said that, to the extent the foreign antitrust regulators have come down harder on the company than American officials, it is a reflection of the different approach towards antitrust law. The American approach towards antitrust has been historically aimed at protecting competition, while the others use antitrust often to protect rival companies.

South Korea Regulators Fine Intel $25 Million
Steven Musil

South Korea's antitrust regulators announced Wednesday that they would fine Intel 26 billion won ($25.4 million) for allegedly abusing its dominant position in the local chip market.

The Korea Fair Trade Commission said in a statement that the chip giant had offered rebates to two PC makers in South Korea in return for not buying processors from rival Advanced Micro Devices. Regulators also ordered Intel to stop offering the rebates.
Bruce Sewell, general counsel for Santa Clara, Calif.-based Intel, criticized the ruling, and told the Wall Street Journal that the company is likely to appeal the KFTC's decision. "The conduct they're seeking to attack is the conduct at the heart of competition. It is offering lower prices in order to sell your products," he said.

The charges mirror those Intel faces from the European Commission, which also alleges that the chipmaker violated antitrust laws by abusing its dominant market position.

The KFTC charged Intel with violating South Korean antitrust laws last year after completing a two-year probe.

Microsoft Free - One Year Later
Mike Kavis

In May of 2007 I wrote a post called Open Source and Microsoft Free. Little did I know that this post would show up on Digg, Slashdot, Craigslist, and several other popular web sites and become a platform for both the Linux and Microsoft camps to wage yet another flame war.

This whole "Microsoft free" experiment started when a colleague of mine challenged me to eat my own dog food after reading many of my posts about my dabbling with open source technologies. The next day, after a few blue screens of death and various issues with Outlook, I grabbed a Ubuntu CD and installed it on my laptop....at work! From that day forward, I have not used a single Microsoft product at work. It has been one year now and I have survived with Thunderbird and Evolution, Open Office, Firefox, and many other open source replacements for Microsoft products.

I put "Microsoft free" in quotes because there are a few exceptions. First, I did install IE 6.0 under wine for that rare occasion that I stumble across a website that only works on IE. Second, there is no answer for Visio. Most of the Visio diagrams that I needed to read were embedded in design documents in Word which I can read with Open Office Writer. But for those that I needed Visio for, I opened them at home on my XP box (I have 1 XP, 1 Vista, and 5 Linux boxes at home). I also used Visio at home when I had to create Visio diagrams. The issue is Visio's proprietary format is not available for developers to write a translation utility for.

With those two issues aside, which represents about 1% of my overall usage on my laptop, my Open Source experience was nearly flawless. Open Office worked remarkably well both receiving Microsoft Office files and creating files in Office format. I exchanged literally thousands of documents between Microsoft Office and Open Office. I never encountered a single issue with Word and Excel and occasionally encountered minor formatting issues with Power Point files. The formatting issues where nothing more then some minor placement issues which probably occurred less then 5% of the time.

Over the course of the year I experimented with Ubuntu, Kubuntu, Freespire, Mepis, and PCLinuxOS. I settled on Kubuntu and recently upgraded with ease to the latest version, Hardy Heron. Here is my analysis of the different Linux distros from last fall. With this "Microsoft free" laptop I have coexisted with 1000+ employees who use XP and various verions of Office including 2007 (the 2007 compatibility add-on works fine). I also delivered presentations at conferences using Open Office Impress and traveled across the country and internationally with no issues with wireless connectivity.

I am not in any camps. I use XP and Linux at home and like both. I gave Outlook the boot years ago at home and do just fine with Thunderbird. It has every feature I need. I do however have problems with Vista. But my message here is not about recommending what tools that my readers should use. My message is that I performed at a high level at work while using Linux, Open Office, and other open source products. These tools did not hinder my ability to do my job and did not impact anyone else at my job. I was able to productively coexist with no Microsoft tools in a Microsoft shop. That is all I am trying to say.

I am not going to recommend to anybody that they change their company standards away from Microsoft. What I will tell you is that open source is a viable alternative that can be used in a production environment. So when you see flame wars where the two camps argue back and forth about their favorite technology, you can point to this post when people claim that Linux and Open Office just won't work in the work place. I have validated that they do work for over 365 days now. Whether we should use these tools at work is a whole different story that really depends on factors like corporate culture, skill sets, budgets, user base, executive support, and many others.

All I can say is that for the last year, I have been using Open Source exclusively and I am loving it!

Microsoft's Ballmer on Yahoo and the Future
Peter Whoriskey

In an animated discussion with Washington Post editors and reporters yesterday, Microsoft chief executive Steve Ballmer offered his far-ranging views of upcoming changes in technology and the media.

Among other things, he confirmed that Microsoft's discussions with Yahoo have continued, predicted that in 10 years all media will be delivered via the Internet and professed that he is confused by Google's moves in the mobile-phone market.

Also, he said that his favorite TV show is "Lost," but he'd rather watch it for free -- with ads -- than pay for it on iTunes.

Q Is Microsoft no longer interested in buying Yahoo? What about the effort by billionaire Carl Icahn to take over Yahoo?

AWill something happen with Yahoo? Every day is a new day. We'll see what happens.

We had no contact with Carl Icahn before he bought his stake . . . Obviously, he has talked to some of our folks since then. He's kind of an independent actor in the thing.

We made an offer; there clearly was a bid-ask difference. We offered less than they wanted. We did move on. We've had some discussions subsequent to that. We have not re-engaged in the discussions about the acquisition of the whole company. We are discussing other forms of strategic cooperation. That's 100 percent accurate.

Was Yahoo co-founder and CEO Jerry Yang reluctant to make a deal because Microsoft's bid price was too low or because his ego was wrapped up in the company he started?

It's always impossible to tell. You sort of have to give people the benefit of the doubt. . . . We offered an incredibly generous premium versus where they were. Maybe some of these lawsuits will turn up interesting e-mail, but I don't think otherwise there will be any way to do the forensics of what was the real motive here.

What is your outlook for the future of media?

In the next 10 years, the whole world of media, communications and advertising are going to be turned upside down -- my opinion.

Here are the premises I have. Number one, there will be no media consumption left in 10 years that is not delivered over an IP network. There will be no newspapers, no magazines that are delivered in paper form. Everything gets delivered in an electronic form.

10 years?

Yeah. If it's 14 or if it's 8, it's immaterial to my fundamental point. . . . If we want TV to be more interactive, you'll deliver it over an IP network. I mean, it's sort of funny today. My son will stay up all night basically playing Xbox Live with friends that are in various parts of the world, and yet I can't sit there in front of the TV and have the same kind of a social interaction around my favorite basketball game or golf match. It's just because one of these things is delivered over an IP network and the other is not. . . .

Also in the world of 10 years from now, there are going to be far more producers of content than exist today. We've already started to see that certainly in the online world, but we've just scratched the surface. . . . I always take my favorite case: I grew up in Detroit. I went to a place called Detroit Country Day School. They've got a great basketball team. Why can't I sit in front of my television and watch the Country Day basketball game when I know darn well it's being video-recorded at all times? It's there. It's just not easy to navigate to.

Given that Google has been leading the creation of open-source software for mobile phones and bidding on wireless spectrum, what do you think their strategy might be in that market?

I have no clue what [Google is] up to. It's very hard for me to understand what they are up to. . . .

I don't know what Google's angle is because it sometimes looks like Google wants to become a telecommunications company. And yet that may not be right. But that recent thing where they went in with Sprint and WiMax guys is very confusing to me. I think it's very confusing to a number of telecommunications companies, as well.

We don't aspire to buy spectrum and get into the direct-delivery game. . . . It's unclear to me why any of us would like to jump in and go compete with rest of the cable, mobile and telecom industry. At least we don't think we do.

Will Internet content generally be available for free, with ad support, or will there largely be fees and subscriptions?

I think there will be some things people subscribe to on the Internet, but I think that's going be more the exception than the rule.

My favorite TV program, "Lost," I watch on the Internet now. I don't DVR it, I just watch it on the Internet.

You don't buy it from iTunes to avoid the ads that come when you get it for free over the Internet?

Why? Because it's free. . . . I have to admit that I'm annoyed by the four 20 seconds [of ads], but not annoyed enough to pay a buck . . . I think at the end of the day most people say, "Heck, if I can get something that's pretty good that's ad-funded and the ads don't kill me, I'll take that over the thing I gotta pay for."

Are Digital Orchestras a Sign of the Times?
David Pogue

This past weekend, I attended an astonishing performance of "Les Misérables" performed by 13- to 17-year olds at a local theater program. Two things made it memorable: first, that this program's director was able to find such amazing voices in this age group, especially for a show where most of the characters are men. (In my experience, more teenage girls than boys are interested in theater.)

Second, the production came breathtakingly close to simulating a full professional production — on a church rec-room stage that measures about 30 feet across and 12 feet deep. We're talking tiny. "Les Minirables."

And yet it worked, partly because the carefully built, minimal sets and props were just enough to suggest their big-budget Broadway equivalents — and partly because of a digital orchestra that accompanied the cast.

But first, a disclaimer and some backstory: When I first came to New York in 1985, as a would-be Broadway composer, I landed my first real job at a theatrical licensing house. That's the kind of company your school or community theater calls to rent the materials (and pay for the rights) to put on a show that was once on (or off) Broadway.

The owner, a smart, forward-thinking guy, immediately asked me how he thought we could exploit the blossoming world of digital music to expand the business.

There was a really obvious answer: "Sell pre-recorded orchestra tracks." But I was really uneasy about taking that road.

I mean, a digital accompaniment can certainly boost a production's professionalism, especially when the only alternative is some beleaguered piano player stumbling through the songs, or a middle-school band honking, out of tune, through a score.

But my own musical career began as precisely that overwhelmed piano player, and, later, precisely that amateur orchestra member. And I knew that every professional musician was once, at some distant past age, a squeaky, honky amateur.

So what we (my boss and I) came up with was a clever technology that relied on MIDI (musical instrument digital interface) technology. For a few bucks, we'd rent you a computer disk that had only the rehearsal-piano part on it, plus the vocal lines. It let you rehearse the dance music slowly, then speed up as the dancers got better. You could make rehearsal tapes featuring, for example, just the tenor part. You could be rehearsing the chorus in the gym, while the dancers were simultaneously working with the computer accompaniment in the gym. It was a huge hit, it was used only for rehearsals, and it put nobody out of work.

(Historical note: To write the playback software, we hired a brilliant young programmer named Jeff Robbin, who, years later, wound up writing a little program called iTunes.)

But things have evolved. Today, that same company offers, for rental with your production of its most popular musicals, a full-blown, sampled orchestra, for use at performances. It's not a recording, exactly. While the conductor conducts, an assistant taps away on a strange little plastic keyboard connected to a computer. The tempo of the digital orchestra is actually controlled by this tapping, so there's still an element of real-time control. You can still follow the singer, if you like, or goose the tempo when the energy of the performance is high.

As you might imagine, I'm deeply conflicted about this development. In the tiny church last weekend, there was no orchestra pit, no fly space, not even a backstage area, so there would have been no way to put on "Les Mis" with anything more than a piano. So in this case, I'm quite confident that no players were put out of work, that nobody's musical participation was denied. And the result sounded magnificent; remember, there's no dialogue in "Les Mis"--it's 100 percent sung -- so the great-sounding orchestra was a huge part of the show's artistic success.

Furthermore, this digital product isn't actually intended to serve as the entire accompaniment, as it did last weekend; instead, it's marketed as a system to supplement live players. That is, if you have done your darnedest to get volunteer musicians for your community theater production, but you still haven't found a couple of woodwinds and a brass player or two (trust me—I've been there many times), you could use the digital system to fill in the gaps, thanks to its ability to play only specific parts.

But I can easily imagine this system being used to replace musicians, either at the budding level or the professional level, and that's what has me bothered. The way you produce the next generation of accomplished musicians is to encourage them when they're young and squeaky; what happens to that food chain when the overburdened English teacher-slash-drama coach decides to take the easy way out with a great-sounding digital orchestra?

Today's sampled sounds are amazing. Ever greater numbers of theatrical, TV and movie scores are played using these digitized sounds instead of live musicians; so really, this digital orchestra product is just a sign of the times.

I can't help remembering how fonts and laser printers wiped out the entire industry of hand typesetters. Today, we see it as an inevitable replacement of a slow, inefficient process. My question is: in 100 years, will anybody go to the trouble of hiring live musicians to using an equivalent-sounding inexpensive box? And will anyone mind?

When Every Song Ever Recorded Fits On Your MP3 Player, Will You Listen to Any of Them?
Karla Starr

There was a time when I knew what I wanted to listen to. I was poor, but I bought CDs anyway, and I had stacks of them, purchased with enthusiasm and knowledge shared among friends. A pricey endeavor, sure. But once I discovered Napster and CD-burning, finances stopped counting. I started storing my music on my computer, and saving songs was no longer a physical, deliberate effort; a mouse-click sufficed.

And I kept on clicking.

I'm now closing in on 95 gigabytes of music — just over 22,000 songs. Much of it I've never listened to, but there's no logic when passion gets in the way. You might say I have too much music at my fingertips. (Impossible! – Jack)

Google vice president Sukhinder Singh Cassidy predicts that in seven years, every song ever recorded in the world will fit into our pockets.

"The average 14-year-old can hear more music in a month than someone would have heard in an entire lifetime just 300 years ago," says psychologist Dan Levitin, author of This Is Your Brain on Music. Thanks to digital music distributors like CD Baby, any independent musician's songs can now appear on iTunes. Heaps of old songs are finding new life in digital files, too.

According to Apple spokesman Tom Neumayr, more than 6 million songs are now in the iTunes store. That means I have about 5,978,000 songs to go. But does it mean I'll be more passionately involved with my music?

"It's too early to say how this will affect our relationship with music," Levitin says. "We might become more attached — because we have so much choice — or less, because the choice causes us not to bond or bind to a particular musical piece."

Why people desire what they do is intrinsically linked to imprinting, our states of mind during early experiences, and reinforcement. And what gets hammered into our psyches is influenced as much by the size of the hammer as by our psyches themselves. That's what allows intelligent people to enjoy the Spice Girls in the company of long-lost friends, tequila, and an impromptu "Wannabe" karaoke session — and why a John Cage piano concerto annoys those same friends.

A glut of choices means we spend less time listening to the same music as other people do, so we don't get as much reinforcement. Music is more portable and thus more personalized. Charles Areni, a former professor at the University of Central Florida and current professor of economics and business at the University of Sydney, speculates that our individual music libraries lead to "increasing dissatisfaction with radio, music CDs, and any other non-customized form of music consumption. Since consumers can now customize their music environments, any 'one size fits all' approach will not make anybody happy."

Social psychologist Barry Schwartz, author of The Paradox of Choice: Why More Is Less, identifies changes from our habit of listening to singles, too: "Less album listening means that people aren't forced to listen to things that don't turn them on right away, and as a result, tastes change less."

Yep, having 6 million songs on hand means that tastes actually change less. It's a common predicament for anyone wanting to expand tastes: knowing that there's no reason to listen to the end of a song, much less an entire album you don't "get" right away. Even though it ultimately will expand my palette, do I really have the patience to get into heavy metal, when I already know I love Spoon?

Faced with such overwhelming choice, most people are fine with using filters to narrow the field, such as self-styled experts from music magazines and popular Web sites. These "experts" define what's hip and cool. The danger is that we're unaware of how dependent on filters we are, and how they filter in the first place.

We're forced to leave out a lot, and possibly we'll never find the song that will change our lives. Are we okay with that? Pressing "shuffle" has replaced driving down to the local mom-and-pop record store on Tuesday and buying a new release. I never had this problem in high school, listening to OK Computer on repeat. Now my iPod is like a remote control or a slot machine, flicking through 500 songs, searching for another emotive spike. I find myself getting bored even in the middle of songs simply because I can.

The paradox of spending so much time changing songs, trying to find one you like, is that you wind up attached to none of them. "Yes, there is too much music product, and most of it is terrible," says Peter Crabb, an assistant professor of psychology at Penn State University. "Kids can spend more time trying to figure out what to listen to and fiddling with their computers and MP3s than actually spending quality time listening to good music."

And there is good music out there. As Ravi Dhar, the director of the Center for Customer Insights at the Yale School of Management, says, "At some point, one has to stop looking for the best strawberries and start eating them."

Boston Needed Lead Singer, Found One Online

Plucked from obscurity, man joins favorite band after karaoke wows founder
Desiree Adib and Stephanie Dahle

Tommy DeCarlo of Charlotte, N.C., dreamed of becoming a rock star, listening to his favorite band's albums and memorizing their songs.

"A Boston song would come on and I'd get fired up and I'd start singing it," said DeCarlo, 43, a father of two kids -- Talia, 19, and Tommy Jr., 17.

But dreams didn't pay the bills, so DeCarlo worked as a credit manager at a Home Depot store in Charlotte to support his.

Still, he never gave up singing along to his Boston CDs, and his daughter Talia took notice. She posted a MySpace page of DeCarlo singing karaoke to Boston songs after the band's lead singer, Brad Delp, committed suicide in March 2007. And, in an instant, DeCarlo's whole world turned upside down.

"I wanted to share [the karaoke] with ... other Boston fans," he said.

DeCarlo had to sing with the karaoke track because he had sold his keyboard in 2006, using the extra cash to buy Christmas presents for his children.

Meanwhile, up in Boston, members of the real band were struggling to continue playing as the coped with Delp's suicide.

"My wife was at her computer playing our tunes, and I asked whether it was us playing live," Boston founder Tom Scholz told USA Today. "She said, 'It's some guy in North Carolina singing your songs.' I said, 'I know Brad's voice, and that's Brad.'"

Still, a skeptical Scholz was intrigued.

"In order to believe it, I had to plug the computer into the big speakers so I could listen to the background music and see if it was the band," Scholz told ABC News. "And I realized it wasn't the band, it was a karaoke track. Somebody was singing to it, and it wasn't Brad."

So the band decided to give DeCarlo a shot -- as their new lead singer.

"I was like, 'Wow!'" DeCarlo told "Good Morning America." "I remember calling my wife and kids in the bedroom and I said, 'Look at this e-mail!' I couldn't believe it."

"I was like, 'Oh my goodness, I can't believe this is happening," said Talia DeCarlo. "It was crazy."

DeCarlo made his debut onstage at a tribute concert to Brad Delp last August. It was the first time he sang with a band in his entire life.

"Even at the tribute, I heard a few people say it was a little eerie to hear Tommy sing, because it sounded like Brad up there," Scholz said.

"My hope is to carry on what Brad meant," DeCarlo said.

DeCarlo and the rest of Boston will begin their summer tour on June 6, 2008, in Thunber Bay, Ontario, Canada.

And the keyboard that DeCarlo sold two years ago, trying to make ends meet? Yamaha is endorcing DeCarlo and shipping him a brand-new synthesizer. He is scheduled to receive it the day before he and the band leave for their tour.

Boston got lucky finding "somebody who is good at something, who loved it and all of a sudden, all the connections got made," Boston founder Scholz said. He added: "Thank God!" For DeCarlo, his ultimate "dream job" has become an unbelievable reality. "A lot of folks have said, 'Wow! You're living a dream.'"

DeCarlo laughed, "I've never dreamed this big. ... Never in a million years I thought this could happen."

Until next week,

- js.

Current Week In Review

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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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