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Old 24-04-13, 06:38 AM   #1
JackSpratts
 
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Default Peer-To-Peer News - The Week In Review - April 27th, '13

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April 27th , 2013




BitTorrent Offers File Synch Tool for PCs and NAS

Peer-to-peer file sharing for backup and collaboration … honestly
Simon Sharwood

BitTorrent has opened the Alpha testing program for its new BitTorrent Sync tool to all.

Announced last January but only available to a select few, BitTorrent Sync looks a bit like the numerous DropBox-without-the-cloud-in-the-middle contenders inasmuch as it lets you set up a source of data, then involve trusted third parties whose machines will sync with the source. The tool is offered for Windows, MacOS and Linux, the latter in a form that can be installed on computers or “... on Network Attached Storages (NAS) running on Linux with ARM, PowerPC, i386 and x86_64 architecture.” Plenty of commercial NAS devices meet those requirements and this forums thread reports on several that seem to have successfully put the software to work.

BitTorrent says the technology involved is “very similar to the powerful protocol used by applications like µTorrent and BitTorrent.”

Data “is transferred in pieces from each of the syncing devices, and BitTorrent Sync chooses the optimal algorithm to make sure you have a maximum download and upload speed during the process.”

All traffic exchanged among peers is encrypted “with AES cypher and a 256-bit key created on the base of the secret—a random string (20 bytes or more) that is unique for every folder.” It's also possible to create one-time secrets to enable a single file transfer, with such passkeys expiring after 24 hours.
Selecting folders to sync with BitTorrent's new tool

BitTorrent is a powerful file distribution technology with many legitimate uses and users, but is tainted by its widespread use for sharing copyrighted material and unofficial association with notorious sites like The Pirate Bay.

This new Sync application may not remove that taint, as it also offers a peer exchange that means “When two peers are connected, they exchange information about other peers they know.” It's not hard to imagine large networks of peers emerging as the tool spreads. Other features also suggest it will be possible to establish large networks of peers, with BitTorrent Sync capable of using trackers “to facilitate peer discovery.”

NAS vendors, however, may welcome the new software, as many have in the past incuded BitTorrent clients in their products. Bittorrent Sync is free for now and there's no indication of whether or not it will eventually come at a cost. Even if it does, NAS syncing between NAS boxen and other computers is clearly a useful function that manufacturers may be willing to shell out for in order to improve their boxes' cloud cred.

Even if that doesn't happen, the thread we've linked to above reports Raspberry Pi users have made the new software work under Raspbian, which makes the tiny computer an even more tempting home-brew storage manager.
http://www.theregister.co.uk/2013/04..._sync_for_nas/





Pirate Bay Finds Safe Haven in Iceland, Switches to .IS Domain
Ernesto

After The Pirate Bay’s new Greenland-based domains were suspended earlier this month, the world’s largest file-sharing site has found a safe haven in Iceland. From now on TPB can be reached via ThePirateBay.is without the imminent threat of another domain suspension. The Icelandic registry informs TorrentFreak that they will not take action against the domain unless a court order requires them to do so.

It has been a busy month for The Pirate Bay’s IT department thus far, with the site skipping from domain to domain.

Two weeks ago the notorious BitTorrent site traded in its .SE domain for the Greenland-based .GL TLD. The Pirate Bay took this decision because they feared that Swedish authorities were about to take over their domain names.

However, TPB did not receive a warm welcome in Greenland.

Within two days of the move The Pirate Bay lost both its .GL domain names. Tele-Post, the private company responsible for .GL registrations, did not wait for a court order and said it would not allow the domains to be put to “illegal” use.

Resilient as always, TPB aren’t about to give up that easily and have already lined up yet another domain name. This time they’re going for Iceland’s .IS TLD, which will be a little harder to take offline.

Thepiratebay.is was registered after the Greenland debacle and traffic was redirected to the new domain a few minutes ago. Iceland is an interesting choice as the country previously positioned itself as a safe haven for freedom of speech.

Whether The Pirate Bay’s activities are considered protected under this definition remains to be seen, but ISNIC, the company responsible for .IS domains, informs TorrentFreak that they have no plans to treat thepiratebay.is any differently to their other domains.

When we asked whether ISMIC would follow Greenland’s lead and move for a proactive suspension, we got a clear answer.

“The short answer is no. Such an action would require a formal order from an Icelandic court. ISNIC is not responsible for a registrant’s usage of their domains,” ISNIC’s Marius Olafsson told TorrentFreak.

This is not the first time that Iceland’s registry has been asked about possible actions against a controversial domain. In 2010, when Wikileaks was hosted under an .IS TLD, the company gave the same response.

“This policy applies equally to any .is domain,” Olafsson says, adding that it’s the domain owner’s responsibility to abide by the law, not theirs.

“There is an article in our registration rules which states that ‘the registrant is responsible for ensuring that the use of the domain is within the limits of Icelandic law as current at any time’,” he explains.

ISNIC’s position means that The Pirate Bay will probably be operating from the .IS domain for a while. Technically copyright holders could file a complaint, but without a prior ruling against the site in Iceland this will probably turn out to be a time-consuming and expensive endeavor.

Even if the domain was taken away, The Pirate Bay would probably move on to the next one as if nothing happened. Until they run out of domains.
http://torrentfreak.com/pirate-bay-f...domain-130425/





Japanese Police Urge ISPs to Block Tor
Ravi Mandalia

Authorities in Japan are presumably worried about their inability to tackle cybercrime and, in a bid to stem one of the sources of anonymous traffic, the National Police Agency (NPA) is asking ISPs to block Tor.

Japanese police is having a hard time when it comes to crimes in the cyberspace. Just last year a hacker, going by the name Demon Killer, took remote control of systems across the country and posted death threats on public message boards. The police arrested four people based on the IP addresses from which the messages were posted and reportedly ‘extracted’ a confession. But, even after the arrests the death threats continued, which forced police to apologize in public.

The man-hunt continued and police did manage to capture and charge Yusuke Katayama with the crimes. Katayama's PCs were seized, analysis of which revealed that the 30-year old regularly used Tor to anonymize his online activities. This particular discovery, among others, was one of the reasons behind formation of a special panel by the NPA for investigation of such crimes.

The Mainichi notes that panel formed by NPA has compiled a special report wherein some of the other crimes cited by the panel include financial fraud; leaks of confidential police information and predatory behaviour of child abusers.

Activists on the Internet or those living in countries with oppressive regimes use Tor to carry out their online whistleblowing activities anonymously. The special panel’s report notes "abuse" of Tor has to be blocked but, the meaning of ‘abuse’ is not clear here and we believe that the real intention here is to completely block Tor.
http://paritynews.com/government/ite...s-to-block-tor





McAfee Patents Technology to Detect and Block Pirated Content
Ernesto

Security software company McAfee has patented a new technology that aims to prevent the public from accessing pirated movies and music online. The system, which expands the SiteAdvisor tool, can detect and block pirated material from any website and present users with authorized and legal alternatives. McAfee says the technology will help steer consumers to authorized services and thereby prevent costly lawsuits.

For years copyright holders have urged search engines and Internet providers to make it harder for users to access infringing content online.

Thus far these efforts have been in vain, but anti-virus vendor McAfee has now presented a technology that will please rightholders. A new patent published by the California-based company describes a system that can prevent users from accessing pirate content.

Titled “Detect and prevent illegal consumption of content on the internet,” the patent covers a blocklist-type system that can either warn consumers, completely block access to web pages, or offer purchasing advice.

According to McAfee there are many reasons for consumers and corporations to be concerned with the downloading of illegal content, ranging from legal risks to malware and virus threats.

“One major reason for concern is possible violation of an Intellectual Property right and the potential cost ramifications associated with such a violation,” the company explains.

“A second major concern could relate to potential threats cause by some unauthorized distributions. For example, it is not uncommon for an unauthorized distribution of material on the Internet to include malicious material.”

McAfee presents their solution as an extension to its widely used SiteAdvisor tool, targeted at both individual consumers and business clients. Threats can be detected in search engines where pirate results get a warning label, but also on social networks including Facebook.

In addition to blocking access to pirated content the technology also has the capability to point users to legal alternative sources for the same, or similar content.

“By informing a user of illegal sources and possible alternatives, a user can obtain the desired electronic distribution without violating an author’s intellectual property rights,” McAfee writes.

Those who click on a pirate link will be pointed to a new screen where users can learn more about the warning. Depending on how the software is set up users may then take the risk and click through to the site. This is similar to how Google, Firefox and other online services already respond to links pointing to malware threats.

By preventing people from inadvertently visiting pirate websites, McAfee hopes that the technology will educate consumers on how to make the right choices when looking for entertainment online.

Whether there are any concrete plans to roll out the system is unknown at this point. The most likely option is that it will be added to McAfee’s existing security products.

If so, we can expect copyright holders to push for a wide adoption of the software.
http://torrentfreak.com/mcafee-paten...ontent-130424/





House Judiciary Chairman Plans Comprehensive Review of US Copyright Law
Sean Hollister

The head of the US Copyright Officer herself admits that copyright law is broken, and has asked Congress to try to create "the next great copyright act." It looks like Congress might actually take up the torch: US House of Representatives Judiciary Committee Chairman Bob Goodlatte says that his group will "conduct a comprehensive review of US copyright law over the coming months," specifically designed to address whether the laws fit the needs of modern technology.

In a speech given in celebration of World Intellectual Property Day at the Library of Congress today, Goodlatte mentioned a few examples of the sorts of problems that he hopes to address in such a review:

The Internet has enabled copyright owners to make available their works to consumers around the world, but has also enabled others to do so without any compensation for copyright owners. Efforts to digitize our history so that all have access to it face questions about copyright ownership by those who are hard, if not impossible, to locate. There are concerns about statutory license and damage mechanisms. Federal judges are forced to make decisions using laws that are difficult to apply today. Even the Copyright Office itself faces challenges in meeting the growing needs of its customers - the American public.

"The goal of these hearings will be to determine whether the laws are still working in the digital age," he added.

Copyright issues are increasingly becoming a part of mainstream conversation, affecting the creative freedoms in TV shows and movies we watch, our ability to unlock our cellphones, receive content from services like Megaupload, Aereo, Pinterest, and much, much, more. It'll be interesting to see if the Judiciary Committee can help make it easier to avoid running afoul of copyright law with new and existing technology, while still making sure copyright owners get some value from their work.
http://www.theverge.com/2013/4/24/42...-copyright-law





Beware The House 'Review' Of U.S. Copyright Law — It's A Trap
Mark Hachman

Yesterday, an influential congressman announced plans for a "comprehensive review" of U.S. copyright law, potentially the first such effort in more than 35 years. And that's got hearts palpitating across Silicon Valley, Hollywood and Capitol Hill.

But don't get too excited about the possibility for reforms that would safeguard an open and innovative Internet just yet. The legislator in question, House Judiciary Committee Chairman Bob Goodlatte, has been carrying water for Hollywood and other Big Copyright interests for years. In other words, this smells like a trap for reformers.

There's no shortage of things to fix in the U.S. copyright system, which was last overhauled back when networking mostly meant dumb terminals connected to a minicomputer or a mainframe. Yet here's where Goodlatte is coming from:

• He supported SOPA, which would have let federal agencies effectively censor alleged copyright infringers from the Internet without due process or much of an appeal;
• He co-sponsored CISPA, which would allow private business to share your personal information with federal agencies without sufficient privacy protections;
• He's generally considered one of the bigger copyright maximalists in the U.S. Congress.

So what's he really up to? Here's what Goodlatte said in a statement:

The Internet has enabled copyright owners to make available their works to consumers around the world, but has also enabled others to do so without any compensation for copyright owners. Efforts to digitize our history so that all have access to it face questions about copyright ownership by those who are hard, if not impossible, to locate. There are concerns about statutory license and damage mechanisms. Federal judges are forced to make decisions using laws that are difficult to apply today. Even the Copyright Office itself faces challenges in meeting the growing needs of its customers – the American public.

Compensation for copyright, digitizing published works, licensing, and cutting through the complexity of existing copyright law — these are all ripe subjects for reform. There's just little reason to think Goodlatte is the right person to craft compromises that offer fair compensation for copyright holders without stifling the development of new digital-media services or crushing individual privacy.
Confederacy Of Dunces

Generally speaking, the odds are against innovation-friendly copyright reform in the current Congress. Democrats have, by and large, been captured by Hollywood when it comes to discussion of copyright terms, digital rights and piracy. in their thinking on this issue. Republicans, meanwhile, have occasionally shown glimpses of original thinking on these subjects — often as not, only to recant them as quickly as Hollywood lobbyists could pick up a phone.

Last November, for instance, the House Republican Study Committee released a position paper debunking various copyright "myths," among them the notions that the current system compensates creators, benefits the public, and promotes innovation. It does no such thing, staffer Derek Khanna wrote; instead, the report called out copyright as an institutional monopoly that crushes new markets before they can prove themselves.

Within twenty-four hours, the GOP had retracted the report, walking the party's position back to the same tired arguments that we had all heard before. Not much later, Khanna himself was out of a job. Techdirt, which has followed the issue extensively, has also noted that Register of Copyright Maria Pallante has suggested that enforcement agencies focus on large-scale piracy (a good idea) but that copyright never inhibited innovation (incorrect).

Absent a SOPA-style revolt by major Internet companies against the current copyright regime, which favors owners over creators and old media industries over the digital world, the best we can probably hope for is that Goodlatte's review doesn't make a bad situation worse.
http://readwrite.com/2013/04/25/good...s-this-a-trick





Court Denies Grooveshark DMCA Protection for Songs Like “Johnny B. Goode”

DMCA? "I guess you guys aren't ready for that yet. But your kids are gonna love it."
Megan Geuss

On Tuesday, a New York state appellate court made a curious decision in a matter being litigated between Grooveshark parent company Escape Media Group, Inc. and UMG Recordings, Inc. The court ruled that due to an oddity in copyright law, the Digital Millennium Copyright Act does not apply to songs that were licensed under state law before February 15, 1972. As such, for these recordings, Grooveshark is not eligible for what is known as safe harbor—an immunity to liability if users upload copyrighted works without the website's knowledge.

As a website that allows users to upload their recordings, Grooveshark's business model depends on the DMCA. Users upload songs on Grooveshark and are warned about uploading copyrighted material. If a rights holder discovers that a user has uploaded a copyrighted song, the rights holder notifies Grooveshark. As long as the website takes the song down quickly enough, Grooveshark avoids being held responsible for the infringement.

But an anomaly in copyright law is throwing a wrench in that system. In 1971, Congress overhauled copyright laws, making most protection a federal matter. However, recordings copyrighted before February 15, 1972 would remain under the purview of the common law and statues of the individual states. The new federal copyright prescriptions noted that “any rights or remedies under the common law or statutes of any State shall not be annulled or limited by this Title until 2067.”

With this in mind, UMG brought litigation against Grooveshark saying that the DMCA, a federal act, does not apply to these recordings under common law. So the website is still liable for copyright infringement if a user uploads, say, Chuck Berry's “Johnny B. Goode” (written in 1958) without Grooveshark's knowledge.

A 2010 filing by UMG in the case says that these titles under state copyright protection include works from “Buddy Holly, The Carpenters, Cat Stevens, Chuck Berry, The Jackson Five, The Mamas and the Papas, Marvin Gaye, The Supremes, The Temptations, and The Who.”

While a New York District court initially ruled in Escape Media and Grooveshark's favor, the New York appellate court took a very different view. “Initially, it is clear to us that the DMCA, if interpreted in the manner favored by defendant, would directly violate section 301(c) of the Copyright Act,” the court's decision read. It went on:

Had the DMCA never been enacted, there would be no question that UMG could sue defendant in New York state courts to enforce its copyright in the pre-1972 recordings, as soon as it learned that one of the recordings had been posted on Grooveshark. However, were the DMCA to apply as defendant believes, that right to immediately commence an action would be eliminated. Indeed, the only remedy available to UMG would be service of a takedown notice on defendant. This is, at best, a limitation on UMG’s rights, and an implicit modification of the plain language of section 301(c). The word “limit” in 301(c) is unqualified, so defendant’s argument that the DMCA does not contradict that section because UMG still retains the right to exploit its copyrights, to license them, and to create derivative works, is without merit. Any material limitation, especially the elimination of the right to assert a common-law infringement claim, is violative of section 301(c) of the Copyright Act.M

Naturally, Grooveshark argued “that if UMG’s interpretation of the DMCA were adopted, that act would be eviscerated,” as the point of the act was to promote efficiency for businesses that host user-generated content. As Forbes writer (and occasional Ars contributor) Eric Goldman points out, Grooveshark “has no easy way to distinguish which user-submitted sound recordings are covered by federal copyright versus state copyright. However, its legal liability depends [on] this difference. … Without universal protection from the DMCA’s safe harbor 'notice-and-takedown' scheme, Grooveshark may be required to pre-screen user uploads to assess whether the file is a pre-1972 sound recording or not, and then it may have to handle those files differently.”

While this ruling has big implications for Grooveshark and other small businesses that host user-generated content, it likely won't affect YouTube as far as UMG is concerned. As Ars reported in December 2011, YouTube and UMG have a private contract that allows UMG to take down its own copyrighted content as it sees fit.
http://arstechnica.com/tech-policy/2...ohnny-b-goode/





File Sharing and the Canadian Indie Musician

While downloading the album of an established, world-famous rock star might not take a bite out of the artists’ wallet, the spread of online file sharing has begun to impact artists who do not have the luxury of a private jet or a world tour.
Liam Scott

A war is raging in the U.S., one that pits the Recording Industry Association of America (RIAA) against individual file-sharers. Six years in, the RIAA has spent $64.1 million on legal proceedings, winning only $1.4 million from its offenders.

The result? The RIAA hasn’t even dented the web of peer-to-peer file sharing services that have continued to grow over the last decade, despite superstar recording artists such as Metallica, Dr. Dre and, most recently, Gene Simmons of KISS, speaking in support of the cause.

But while downloading the album of an established, world-famous rock star might not take a bite out of the artists’ wallet, the spread of file sharing has begun to impact artists who do not have the luxury of a private jet or a world tour.

I guess (radio placement) is a major source of income if you’re Katy Perry or Lady Gaga or something.

“We were sleeping on the floors of friends-of-friends’s apartments. We had $10 a day for food, no per diem. We were definitely pinching pennies,” says Phil Maloney, drummer for Newfoundland band Hey Rosetta!, of their first tour. “It’s not until the third tour or so that you hope to at least break even.”

For a band that has had their music featured in CBC Radio’s Great Canadian Song Quest, as well as on the hit Canadian TV show Flashpoint, one would think the album sales would be substantial. While that may have been true a generation ago, things are different now. “Albums are a dying form of income,” explains Maloney, a sentiment echoed across the Canadian indie music scene.

Max Kerman, front man of Hamilton quartet The Arkells, says record sales provide “pretty little in the form of money. It’s probably like that for most bands.”

It’s not just the artists taking a financial hit from declining sales. Mike Greatorex, of Sonic Entertainment Company, says labels are being forced to find other ways to stay afloat as sales crash. “If (Sonic Entertainment) was just a record label, we would have gone out of business years ago,” says Greatorex, noting that Sonic Entertainment’s management of bands is what generates most of the income. Sonic’s label has signed four acts in the past eight years but, ideally, the number of acts signed would be at least twice that.

“(Physical record sales) are a bit of a joke, honestly,” admits Greatorex. “A lot of smaller labels don’t bother with major physical distribution anymore.”

The root of declining record sales? Piracy.

Since the inception of the peer-to-peer file sharing service Napster, in July of 1999, the music industry has fought non-stop for its fair share of revenue. But always it found itself one step behind file sharers.

“Our entire career has seen a rise in the popularity of our band and, at the same time, a drop in our album sales,” says Stephen Carroll, lead guitarist and manager of Polaris-nominated, Winnipeg indie-rock staples, The Weakerthans. The Weakerthans’s first album, Fallow, was released in 1997, when downloading music was all but unheard of. Carroll says the majority of their fans probably downloaded their last album, Live at the Burton Cummings Theatre.

“Demand (for music) hasn’t gone down,” explains Greatorex, “but if the options are buying it versus getting it for free, people will obviously choose free.”

Websites like thepiratebay.org, operated out of Sweden, are the main culprits for harbouring illegal torrents. Pirate Bay makes most of its revenue from advertising on the website, much to the chagrin of artists.

“I have a real problem with websites that profit from banner ads without giving anything to the artist,” says Winnipeg singer/songwriter, James Struthers. “Just because copyright laws are different in your country, it doesn’t give you the right on any level.”

Artists and labels may not agree with file sharing, but there’s no sign of their stance slowing it down. Greatorex used to track down and report illegal torrents of bands on his label, but soon gave up. “It’s impossible, so I stopped doing it,” he says, noting that in the time it took to contact the hosts and demand one be removed, two would pop up elsewhere.

The murky legal and moral ground surrounding piracy is the reason behind its prevalence. Most people, primarily a younger demographic, don’t see it as stealing.

“It’s the net, it’s going to get out there anyway,” says Michelle Zuniga, a nursing student at Ryerson University. She doesn’t see intellectual property as something one can claim ownership of, so it doesn’t count as stealing.

As artists and labels have come to accept the realities of file sharing, silver linings have presented themselves. Aaron Miller, of Toronto-based Indie label Arts & Crafts, thinks file sharing can benefit artists and labels, if used correctly.

“It’s indirect, but the ability to spread music and disseminate products around the world like that, even illegally, can mean invaluable exposure,” says Miller.

Struthers cites the overseas popularity of some Canadian bands, like Broken Social Scene and The Weakerthans, which would never have been possible without the internet.

“Broken Social Scene can tour China because of downloading. Nobody there has actually bought their album,” says Struthers. Last year, Broken Social Scene played shows in Singapore, Taiwan, and Tokyo, a long way from their roots in Toronto. The fact that these places have even heard of Canadian music, to which they are rarely otherwise exposed, is a testament to the power of piracy.

The boost is felt at home as well as abroad, which leaves artists and labels in a grey area of support.

“If people are digging the record and then come out to the show, that’s great,” says Kerman.

Physical record sales are a bit of a joke, honestly.

Maloney agrees. He realizes that not all the people wearing Hey Rosetta! T-shirts and coming to their shows have purchased the albums. “It took them downloading the album to come to our show and buy a shirt in the first place.”

Marti Sarbit, vocalist for Winnipeg duo Imaginary Cities, says that first and foremost, “music should be accessible.” The problem comes when the spread of the artist’s music is beyond their control.

“It’s the artist’s living, and they’re entitled to it,” says Maloney.

The effects of file sharing on Canadian indie labels and artists are unavoidable, and it’s forcing the industry into a sink-or-swim situation. Many labels have taken on management duties as well, to get a piece of revenue from their artists’s merchandise sales and live shows.

“The degree to which a label is affected (by file sharing) does, to some extent, reflect the degree to which they have been able to diversify their revenue. With our licensing, management, publicity and event production wings, we have been able to stay afloat in the face of slumping sales,” Miller says of Arts & Crafts.

Struthers says more labels are signing, “360 deals,” which are essentially record deals in which the label collects money from all revenue streams, such as merchandise, playing shows and music placement. This way, the label does not have to rely purely on album sales.

Many of the bands have turned towards government grants and private organizations to support their careers. Maloney cites MUSICNL, an organization that provides funding to Newfoundland and Labrador musicians, as one of the main pillars of Hey Rosetta!’s career, saying, “we wouldn’t be a band if it wasn’t for MUSICNL.”

Greatorex says Canadian musicians have far more grants accessible to them than their American counterparts, who have almost no support. Still, he says, “there’s something inherently wrong with an industry that relies too heavily on government funding.”

Our entire career has seen a rise in the popularity of our band and, at the same time, a drop in our album sales.

Royalties from radio and television placement are also sources of income, and this only helps bands or artists that receive substantial radio rotation.

“I guess (radio placement) is a major source of income if you’re Katy Perry or Lady Gaga or something,” says Carroll.

Less money earned from music, coupled with lower cost of production, has created an influx of bands that are forced to play more shows.

“We used to book shows two, three months in advance for a tour. Now we have to book at least six months in some locations,” says Carroll. He fears this will create a, “race to the bottom,” with bands playing more shows for less pay to compete for gigs.

Massive tours are certainly the norm for Hey Rosetta!, who played 85 shows between February and November of 2010, 50 of those between June and October. “That’s pretty much how bands exist now, by playing lots of shows,” explains Maloney.

So what’s next for Canadian music?

One thing that’s certain is that piracy is here to stay. “Everybody’s done it at some point,” says Maloney. “I’ve downloaded music for free.”

The problems arise when one considers the prospect of prosecuting something that nearly everybody has a part in. “Ideally, there should be some way to regulate it,” says Imaginary Cities’s other half, Rusty Matyas, but the music industry has yet to find a way of doing so.

Despite the prevalence of file sharing, the future of physical music is not as bleak as one might think.

“There’s something to be said for tangible media,” says Maloney. “The cover art and lyrics make it more personal.”

Matyas says that CDs are dying fast, but “vinyls (sic) are definitely making a comeback.” Carroll says that certain dedicated fans buy vinyl records. He estimates that about 10 per cent of their overall sales are vinyl, and while that number is on a steady rise, it’s done almost nothing to combat the rapidly declining overall sales.

The future is unclear, but a shared sentiment is that the shift of control away from major labels and towards the artists is imminent, as exemplified by Radiohead’s decision to self-release their 2007 studio album In Rainbows through their website and allowed their fans to decide how much they wanted to pay. Since then, other popular acts like Nine Inch Nails have followed suit.

While these releases make an impactful statement on the music industry, the artists in question had already established a massive fan base and considerable wealth, minimizing promotional costs and negating any budgeting worries.

“(Radiohead’s method) is more of a statement than a reliable business model,” says Greatorex. Most smaller bands, especially those just starting out, can’t take the risk of not recouping the money lost making the record.

Struthers says it wouldn’t be far-fetched to see a variant of this model catch on. “Within five to ten years, all the music might be available for free from the artists themselves.”

“The music industry is really learning a lot about itself right now,” says Max Kerman, of The Arkells. “They’re still trying to figure out how to connect with people and make up for their losses.”
http://www.arbitragemagazine.com/fea...ndie-musician/
http://paritynews.com/government/ite...s-to-block-tor





Will.i.am Says He Accidentally Stole a Song
Billboard Staff

Will.i.am admitted confusion today over whether he ever had the rights to use the backing track on his new song "Let's Go," featuring Chris Brown. Russian producer and DJ Arty had accused the Black Eyed Pea of stealing his song, "Rebound," on Twitter last week.

A comparison of the two songs confirms they are identical, and will.i.am tried to explain himself during a KIIS-FM interview on Tuesday.

"Arty is a dope producer so I wrote this song to 'Rebound' this last year," he said. "I got in touch with Arty and showed it to him, did a different version to it 'cause I asked him [to] make it newer 'cause I don't just wanna take your song and rap over it."

But he said that after a year's time, "we preferred writing over and using the [original] rebound. Something happened and the clearance... hopefully we resolved the issue."

Arty claimed in Twitter posts on April 16 that no one from will.i.am's team had worked out a deal for the tracks through his label, Anjunabeats. "Let's Go" was uploaded to will's YouTube account on April 16, and has over 750,000 views and 14,000-plus comments already, many of them negative.

"He finally admitted it. On the day the album is released, of course. Go write this thief a review on iTunes," wrote "riotistx" in one of the video's top comments.

"Let's Go" is the fifth track off will.i.am's fourth studio album, "#willpower," out today. Arty and Mat Zo's "Rebound" was released in April 2011.
http://www.billboard.com/articles/ne...source=twitter





China Court Fines Apple $118K for Copyright Breach

Summary: A Beijing court has ordered Apple to compensate three Chinese writers for selling their works via its app store without getting their permission.
Kevin Kwang


Apple will have to compensate three Chinese writers for infringing their copyright rights when it sold their books online without first seeking permission.

A China Daily report Wednesday stated the Beijing No. 2 Intermediate People's Court ruled in favor of the authors, and Apple will have to pay them in excess of 730,000 yuan (US$118,000) for the infringement. Apple had not gotten permission before selling their books on the Apple App Store, it noted.

The presiding judge, Feng Gang, said Apple has the duty of checking whether the books uploaded by third-party providers are in line with current laws.

He said: "The writers involved this time include Mai Jia, whose books are often on bestseller lists across the country. In this way, Apple has the capability to know the uploaded books on its online store violated the writers' copyright."

Feng also warned other tech companies with similar online stores should learn from this case and improve their verification systems to avoid similar disputes.

These cases were the second batch of lawsuits filed against Apple by the Writers' Right Protection Union, which is an organization safeguarding local writers' online copyright, it added.

Wang Guohua, the lawyer representing the writers told China Daily he was satisfied with the results and the compensation ruling was higher than in most copyright infringement cases. Apple's lawyer declined to comment, according to China Daily.
http://www.zdnet.com/cn/china-court-...ch-7000014487/





E-Commerce Giant Alibaba Works With Chinese Government to Bring Down Piracy in China
Willis Wee

China’s e-commerce giant Alibaba is working with five Chinese government agencies to fight piracy in China. Founder and chairman Jack Ma was on hand at today’s event, warning Chinese brands that it’s in their long-term interest to respect intellectual property laws. Ma said:

This is a long-term effort … we want the indigenous brands to work together to protect IPR, because if you do not participate today, tomorrow you are the victims. Hopefully in 10 years, the Chinese internet economy will be a much better place because of the efforts we have started here today.

Polo Shao, chief risk officer at Alibaba Group, said today that “big data” technology and traditional law enforcement resources will make investigation and enforcement of China’s intellectual property laws more effective. Shao added:

On e-commerce platforms, every single transaction creates a record, and every piece of information about sellers of counterfeit products is traceable. Internet technology … when paired with offline efforts can be used to create targeted initiatives to drive intellectual property protection as well as cut off the head of the snake in an attempt to purge society of counterfeit goods.

Of Alibaba’s web properties, its C2C marketplace Taobao has been especially plagued with pirated goods. Former CEO Jack Ma even joked in a previous speaking appearance that piracy somewhat added a surprise element to shopping at Taobao. Putting jokes aside, Ma is serious about cracking down on pirated items in its marketplace with this partnership with the Chinese government. The company will even set up an in-house anti-piracy task-force to be headed by Polo Shao. Ma calls China’s common counterfeit branding a “cancer” and a “tumor in society.”

According to Alizila, Alibaba’s corporate blog, “more than allegedly 94 million infringing listings were removed from Alibaba Group platforms” last year and about “5.5 million of them were taken down as a result of complaints from rights owners.”

Taobao was removed from the US Trade Representative’s notorious pirate watch-list a few months ago, with the organization citing major IPR improvements on Alibaba’s various web properties. But the situation is far from solved – least of all on the company’s own e-commerce platforms.

Tackling piracy – both online and offline – should greatly help China repair her tainted reputation on the global stage.
http://www.techinasia.com/alibaba-wo...-solve-piracy/





U.S. Box Office Heroes Proving Mortal in China
Michael Cieply

Hollywood’s global business strategy, which counts on huge ticket sales in China for high-budget fantasies in 3-D and large-screen Imax formats, is coming unhinged.

Last year, helped by a high-level deal that expanded the number of foreign films for release there, American blockbusters like “Mission: Impossible — Ghost Protocol” led the Chinese box office for 23 straight weeks, and received a disproportionately large share of their ticket sales from China.

More big releases were on the way, and the floodgates in the world’s second-largest film market appeared ready to swing open.

But something unexpected happened on the way to the bank: demand tapered off sharply.

In the first quarter this year, ticket sales for American movies in China — including films as prominent as “The Hobbit: An Unexpected Journey” and “Skyfall” — fell 65 percent, to about $200 million, while sales for Chinese-language films rose 128 percent, to well over $500 million, according to the online publication Chinafilmbiz.com.

The weekend brought one sign of a rebound for Hollywood: “G.I. Joe: Retaliation” from Paramount Pictures, took in a respectable $33 million at the Chinese box office, matching roughly 75 percent of its ticket sales when it opened in the North American market on March 28.

But if the preferences of Chinese moviegoers continue to shift to domestic releases, China will maintain control of its own film market just as Hollywood was ready to seize it.

When “Iron Man 3,” an action heavyweight from Disney’s Marvel Entertainment, opens in coming days, it will slug it out with a small, domestically made romance called “So Young,” about a Chinese woman who reconnects with her college sweethearts. It is hard to be certain which film will be the underdog.

In fact, a succession of domestic Chinese films, including the comedies “Lost in Thailand” (a close cousin to “The Hangover Part II”) and “Finding Mr. Right” (China’s answer to “Sleepless in Seattle”), have unexpectedly clobbered expensive American fare like “Oz the Great and Powerful,” “The Hobbit” and “Jack the Giant Slayer” on Chinese screens.

The abrupt shift toward local favorites may have something to do with market manipulation. As American films gained traction in China last year, alarmed officials imposed an unusual two-month blackout that kept most foreign movies off screens during the summer season.

They also forced “The Dark Knight Rises” and “The Amazing Spider-Man” into direct competition with each other, and promised to pay theater owners an annual bonus if their receipts from domestic films matched revenue from foreign films for the year.

Still, executives and China watchers here suspect something potentially more threatening to Hollywood: a rapid evolution in the tastes of Chinese audiences, which are quickly turning away from the spectacles American companies have assumed they crave.

“I know what they don’t seem to want,” said Rob Cain, who runs Chinafilmbiz.com and is a consultant to producers and others doing business in China. “They don’t want the same old thing, over and over again, the action blockbusters with lots of explosions.”

The apparent shift is helping Chinese films like “Lost in Thailand,” which was an eye-opener last year when it posted more than $200 million in ticket sales in China. It surpassed “Avatar” to become the country’s best seller in terms of total admissions (though not revenue, as “Avatar” had heavy 3-D sales at premium prices). It led a string of Chinese-language hits that outstripped Hollywood films like “Stolen,” “Jack Reacher,” and even “A Good Day to Die Hard,” which briefly claimed the top spot in China.

Richard L. Gelfond, chief executive of the Imax Corporation, whose screens in China play both American-made and Chinese-made films, said he was confident that viewed over a long period of time, “China is opening up to Hollywood.”

But lately, Mr. Gelfond acknowledged, the shift toward domestic films has been “dramatic.” In early 2012, he said, American studios did well in China partly because the available Chinese films lacked audience appeal. Later, he noted, Chinese officials delayed the release of “Skyfall” and “The Hobbit” until those films had played elsewhere, which allowed video pirates time to put a dent in the potential audience.

Mr. Gelfond said he expected American films to rebound in China over the next few months, as more of them are released on or near their opening dates elsewhere in the world.

But others say that will happen only if American studios acknowledge the sophistication of Chinese viewers, a large number of whom are college-educated, and not easily beguiled by routine action and fantasy imports.

“The change is that Chinese audiences want more from Hollywood movies — not just spectacle, but stories that engage them,” said Michael Andreen, a consultant to the Chinese media firm Le Vision Pictures, which will make and acquire films for release both in China and around the world.

Correctly gauging the Chinese market is crucial for big American studios, which have banked on rapid growth in revenue there to shore up relatively stagnant domestic returns. Last year, China’s box office reached about $2.7 billion. Ticket sales there are expected to surpass those in the United States by about 2018.

For the moment, Hollywood’s best hope remains “Iron Man 3.”

Shot partly in China, “Iron Man 3” has been heavily promoted there for the last year, including at a star-studded event at the Tai Miao temple in Beijing this month. It will also have extra scenes tailored to the Chinese audience, with an assist from a financial backer based in China, DMG Entertainment.

The first two “Iron Man” films did well in China, and “The Avengers,” which included the Iron Man character, took in about $90 million at the Chinese box office last year.

But Marvel and its backers have to sweat out their matchup with “So Young.” Partly, they will have to be sure theater operators do not assign some of the revenue from American movies to other films to protect the bonus tied to the success of domestic movies.

Whether the two films will be released head to head on April 26, as widely reported, remains unclear. After some last-minute work on a Chinese-language version, “Iron Man 3” still awaits an official opening date in China.

At the same time, “So Young” has some inherent advantages. It is the first film directed by a popular actress, Zhao Wei, who is known for her performances in “Red Cliff” and “Shaolin Soccer.” And it is based on a much-read novel, whose title is sometimes translated “To Our Youth That Is Fading Away.”

Still, it is impossible to tell whether those advantages are strong enough to give it an edge on Marvel’s juggernaut, given the lack of sophisticated prerelease tracking in China.

Regardless of which movie wins the face-off, Mr. Cain of Chinafilmbiz.com said, Hollywood will have to accept that Chinese viewers are perhaps even less predictable than those at home.

After all, their favorite English-language films of late have included the time-bending epic “Cloud Atlas,” which did little business in the United States, and the fable “Life of Pi,” whose spiritual themes might seem at odds with China’s governing principles.

“They want to see films that challenge them,” Mr. Cain said.
https://www.nytimes.com/2013/04/22/b...-in-china.html





Windows 8.1 Build Version 9374 Leaked, Available On Filesharing Websites
Vamien McKalin

A version of Windows 8.1, otherwise known as Windows Blue, has leaked on various torrent-related websites. The file doesn't appear to be a trick of any sort, but still, we don't recommend downloading it, as it could contain malware or viruses.

The newest version of Windows Blue is build 9374, but it is not quite certain what features this new build brings to the table, so don't go expecting to see the return of the Start Button. Microsoft may or may not crack down on this leak, so if you're not too afraid of download torrents, give it a shot.

According to multiple sources, Windows Blue is the next version of Windows 8 that promises to bring some cool new features along with much-needed enhancements. The operating system could come with Internet Explorer 11, which will feature tab synchronization across Windows 8 and Windows Phone 8 devices. Want smaller tiles similar to Windows Phone 8? That's coming too, along with other things to get more users using the new start screen instead of the traditional desktop on tablet devices.

The release for Windows Blue is rumored for August or September, while a public beta release could come some time around the BUILD conference in June.

Windows Blue is Microsoft's latest effort to keep Windows 8 relevant and to please those who don't like the operating system. So far, the slow adoption of Windows 8 is causing major problems in the PC industry, as OEMs are losing profits and there is no real second option. They can't go the Android route, as tablets with that operating system are not selling well, and they can't equip iOS, as it is exclusive only to Apple. The only option OEMs have at this point is to wait and hope that Microsoft gets its act together soon, and gives users want they want.
http://www.mobilenapps.com/articles/...g-websites.htm





Windows 8.1 Set to Bring Back the Start Button
Tom Warren

Microsoft is preparing to revive the traditional Start button it killed with Windows 8. Sources familiar with Microsoft's plans have revealed to The Verge that Windows 8.1 will include the return of the Start button. We understand that the button will act as a method to simply access the Start Screen, and will not include the traditional Start Menu. The button is said to look near-identical to the existing Windows flag used in the Charm bar.

"Microsoft changes its mind"

Microsoft's change of heart follows another recent planned change for Windows 8.1: a boot to desktop option. We understand Microsoft will add an option to allow users to boot directly to the traditional desktop environment in future builds of the upcoming Windows 8 upgrade. Most internal builds of Windows 8.1 do not include the Start button or boot to desktop options, but Microsoft is said to be planning how to add these into the operating system. ZDNet's Mary Jo Foley previously reported on Microsoft's plans to bring back the Start button and a boot to desktop option.

The death of the traditional Start button in Windows 8 was one of a number of controversial changes introduced with Microsoft's latest operating system. In our review of Windows 8 we called the new navigation changes "a steep learning curve," and feedback on the Start button removal has been mixed. 1.5 million downloads of Pokki, a Start Menu replacement, and other similar tools suggest that Windows 8 users still want the Start button and Start Menu. Microsoft explained away its removal using data it gathered from the company's Customer Experience Improvement Program, but we understand the return in Windows 8.1 is due to customer feedback. We may see the Start button return in the upcoming Windows 8.1 Public Preview, if not expect to see it in the final version due later this year.
http://www.theverge.com/2013/4/22/42...1-start-button





Nearly 20 Years After Windows 95, Microsoft Is Lumbering Toward Cool Again.
Mat Honan

In June 2012, Microsoft summoned the technology press to Los Angeles for a surprise product announcement. Basil-cucumber-lemonade vodka cocktails waited at the door; the overhead PA system cranked “We Are Young,” that anthemic cliché by Fun. A who’s who of Microsoft executives, including CEO Steve Ballmer and then-Windows president Steven Sinofsky, strutted across the stage to unveil Surface, the first computer manufactured by Microsoft in its nearly 40-year history. It was a beautiful tablet with a detachable, millimeters-flat keyboard—and it was running Windows 8, the company’s next-gen, touch-forward interface. This was Microsoft? Wow.

The event was a hit. This was good news, because Microsoft had more to talk about during the next five months. A lot more.

The very next day, the company held a press event in San Francisco to reveal Windows Phone 8, its new mobile OS, followed by free beer upstairs at the hotel bar. In October, a fleet of reporters flew to Redmond for a hands-on session with the Surface; to prove the durability of its molded magnesium casing, Sinofsky had wheels put on one and rode it like a skateboard. Two weeks later, Microsoft took over Manhattan’s Pier 57 to celebrate the release of Windows 8 and the sleek new Surface RT model. Four days after that, it held a release event in San Francisco for Windows Phone 8 featuring Ballmer and Jessica Alba and hot food and Bloody Marys and mimosas.

In less than six months, Microsoft had pulled off one of the most ambitious product-launch cycles in history. It had reinvented Windows for a new era. It released its first-ever computer. It had a brand-new phone that finally shared the same underpinnings as its desktop.

And then the reviews began to trickle in. Most were just OK. Some were bad. Really, really bad. Two weeks after Windows 8 went on sale, its longtime master, Steven Sinofsky, decided to leave the company.

Phew. Who else needs a drink?

It’s been nearly 20 years since Microsoft rolled out Windows 95, and so much has changed since then. At a time when only two in five US households had a computer, Microsoft set out to accomplish one of the great missions in corporate history: to put a computer on every desk and in every home. The excitement about Windows 95 was genuine. The TV spot was set to a track by the Rolling Stones (at the time, still pretty cool), and the system’s new startup sound, that shimmering glissando of unresolved mystery, was written by Brian Eno. It was hip and wantable—even though it didn’t really have to be. Fundamentally you needed Windows at home because it was what your IT department made you run at work.

Apple, by comparison, was limping along. Its System 7.5 operating system was a mess, and the company would soon kill off the intended replacement OS, Copland. There was no other clear rival to Microsoft. It hadn’t merely won; it had shattered all opponents. Michael Dell famously suggested that Apple liquidate its assets and give the money back to shareholders.

But in the new century, everything went wrong for Microsoft. The iPod, the iPhone, and then the iPad changed the way we think about our devices, recruiting an entire world of consumers into the cult of design. Computers moved off desks and into pockets and bags and watches and glasses and refrigerators and washing machines. We entered a post-PC world. Computers changed from being devices we used at work—and a little bit at home, on machines whose main qualification was compatibility with our work machines—to devices that were with us all the time. Increasingly it was individuals, not their employers, who drove the purchasing decisions. And what they wanted were things that looked nice and made them happy. They wanted the Samsung Galaxy Note and the Kindle Fire and, most desperately of all, the iPhone: the pinnacle of gadget culture, the device that gave rise to a new acronym in corporate America—BYOD—and forced IT managers everywhere to allow Apple products into the workplace.

This is the world for which Microsoft is trying desperately to reinvent itself. As Ballmer put it in an October 2012 letter to shareholders, Microsoft aims to become a “devices and services” company, one that makes products to delight the consumer and corporation alike. Ballmer understands that if it wants to remain one of the biggest companies in the world, it has to pull off a tricky, almost impossible, balancing act. It must get new customers to buy its products because they want to, not because they have to for work. But it also has to make sure it doesn’t lose its existing customers—universities, corporations, hospitals—who need products designed very specifically for the workplace. Microsoft needs to make not just things you need, like Office, but things you actually want, like Surface. In short, Microsoft needs to be cool again.

Windows 8 is an uncomfortable mix of playfulness and stodginess. It’s the mullet of computer operating systems.

At center stage in this effort is Microsoft’s biggest balancing act of all, a new vision for Windows itself. Windows 8, released in October of last year, is Microsoft’s most fully realized reinvention. It is designed to work everywhere—on tablets, desktops, laptops, and even phones (Microsoft’s mobile OS, Windows Phone 8, shares some of the same basic code base). Windows 8 is meant to bring beauty and elegance to all those places. It is wonderful. And people hate it.

They hate it because instead of unifying everything, Windows 8 is a fractured, bipolar experience. In its attempt to balance the demands of good design and those of its conservative user base, the OS winds up being an uncomfortable mix of playfulness and stodginess, the mullet of computer operating systems.

On one side is Metro, the “design language” that serves as the centerpiece of Microsoft’s reinvention. Influenced by navigation signage, including that of Seattle’s own Metro transit system, Metro is beautiful, with a consistent set of sans serif typefaces designed in conjunction with the legendary studio Agfa. It’s meant to be the next generation of computing interface, one in which fluid, readable data tiles replace the icon-based one we’ve known since the early days of the Macintosh. The idea is that Metro’s design will flow across every Microsoft platform—Xbox, Windows, Windows Phone, and more.

Metro’s genesis goes back to the design used for Microsoft’s Encarta, the 1990s-era encyclopedia application long ago cast into irrelevance by Wikipedia. From there it moved to the Zune and Xbox and made its big debut in Windows Phone 7. At the time, Windows Mobile was dying and the company could afford to experiment. And sure enough, on the strength of its design, Windows Phone 7 was an instant critical darling. “I’m kind of shocked. Every screen is much more beautiful than the same apps on Android and iPhone,” raved Apple cofounder Steve Wozniak. (It wasn’t without problems. In a boneheaded oversight, Microsoft failed to secure the Metro name, which apparently was locked up by the German retailer Metro AG. So, after touting “Metro style” over and over again in public, the company suddenly dumped the name with little explanation just before Windows 8 launched. Today, what was once Metro is known variously as “Windows 8-style UI” or “the new Windows UI” or “Windows 8 Store-style” or “Modern UI style” or “Microsoft Design Language,” depending on who you ask and when. We’ve decided to just stick with Metro here.)

Across all platforms, Metro functions as a constant information delivery system. Through so-called Live Tiles, it trickles tidbits of data to users at every possible opportunity, so they can get the information they need without having to fire up an app. The icon for the calendar app itself tells you that you have a meeting in an hour. Your mail icon cycles through the subject lines of your new messages and who they’re from. The weather icon shows current conditions. Information comes to you; you don’t have to ask for it.

Once you click through into an app, information takes over the full screen, with menus appearing only when you swipe in or up from the edges. And those swipes are just one of the wonderful new gestures that Metro incorporates; another is Semantic Zoom, which makes scrolling through thousands of items simple and elegant in a way that Steve Jobs himself would have envied. It’s a touch-first interface, built for a new era of portable devices.

So much for the party in the back. For the business up front, there’s the Windows desktop, which is largely unchanged. It will run your Windows 7 programs. It’s brutally ugly, especially when compared with Metro, but at least it’s familiar.

Why, then, are users not embracing the new OS? One reason is the major exception to that familiarity: In Windows 8, Microsoft has killed off its most iconic creation, the Start button.

Journalists love to talk about the courage it took for Apple to stop producing the iPod mini, then its best-selling device. But that was nothing compared with Microsoft axing the Start button. For millions of people, the Start button was how you used Windows. It was the gateway to everything. But Microsoft decided it was a gateway to the past. Julie Larson-Green, corporate VP of Microsoft’s Windows division, believes tomorrow’s key actions will be based not around launching applications but around the flow of data—giving it to users or letting them broadcast it themselves. “With Windows 8, it’s about how we can put information at their fingertips rather than applications,” she says.

But Windows users responded with confusion and even anger to this disruption in their long-established workflows. People took to YouTube to post reaction videos of attempts to use Windows 8 without the Start button. (Predictably, Hitler took the news of its disappearance poorly.) The media published story after story on ways to work around its absence. Third-party programs designed to replace the missing menu racked up millions of downloads. It was a metaphor for everything wrong with the new Windows.

There is a secondary effect of losing the Start button: It drives people to Metro. Click where the Start button once was and you’re taken to the Start screen, a Metro environment where you can “pin” applications for easy launching. As it turns out, though, people don’t want to go through Metro, and the proof is in the sales. Not only has Windows 8 adoption lagged behind Windows 7 during the first four months after its release, the data (see chart) shows it isn’t even keeping up with Vista, which was widely considered a disaster. Even Windows advocates and defenders concede the deck is on fire. “Anyone who was hoping for a quick reversal of trends should be disappointed by Windows 8&rsquot;s market acceptance so far,” wrote the generally pro-Microsoft blogger Paul Thurrott this winter. Acer president Jim Wong—whose company is in the business of making Windows machines—has said flat out that “Windows 8 itself is still not successful.”

In Ballmer’s letter to shareholders, the CEO talked about selling to the workplace, and the very first thing he said was this: “Fantastic devices and services for end users will drive our enterprise businesses forward.” In other words, if Microsoft makes great gear, people will want to use it on the job. After years of owning the corporate market and expecting consumers to follow, Redmond is now staking out a BYOD strategy of its own.

Such was the concept behind Surface, which was meant to embody the new Windows. And like the new Windows, it was wonderful and people hated it. (“We hadn’t looked forward to something this much in a long, long time,” wrote the tech blog Gizmodo. “Now it’s here. And it’s been just as long a time since a gadget has been so disappointing.”) Surface had succeeded too well in being the embodiment of Windows 8—it tried to be too many things to too many people. “It’s like the investment banker who suddenly decides to become a skater,” notes a former employee who was privy to the changes.

Here’s the problem with trying to be that cool skater type: Microsoft’s core products just aren’t that cool, and they possibly never will be. There are many important tasks—creating spreadsheets, databases, presentations—that we won’t (or maybe even can’t) carry out on Jolly Rancher-blue magnesium phablets. Indeed, Microsoft’s legacy business and cash cows essentially depend on it not being cool, at least for now.

Inside the tech industry and among those of us who write about it, we expect things to happen immediately, or even sooner. But Microsoft is a big old ship, and turning it around takes time. So it’s right that Ballmer and company are looking five years ahead.

Surface, Windows 8, and most especially the interface formerly known as Metro—these things are starting points. Microsoft is learning. It’s moving to a yearly release cycle, with each release looking better than the last. And in the process, it’s embracing the idea of a mobile, portable future in which we arm ourselves with whatever device suits our needs at the moment. It is moving away from the desktop, but in such a way that it can still serve those who need the desktop. Thanks to deep integration with the cloud, changes you make in one place are reflected everywhere, automatically and invisibly. The gestures it has developed are by far the best on any OS. And it’s already starting to solve its chicken-and-egg problem, where developers and users each wait for the other to embrace the platform. As developers trickle in (Twitter, for example, just rolled out its first full-featured Windows 8 app in March), so will users.

We are in a great moment of transition. In just a few more years it will seem bizarre that our various screens all needed different drivers, that they showed different data. Game consoles are dead men walking. The phone is a relic. TiVo is something your father used. Everything is coming together, and Microsoft is as suited as any company to grapple with this change and flip it over on its back. Make no mistake: Microsoft is still a lumbering giant. But for the first time in years, it’s lumbering in the right direction.
http://www.wired.com/magazine/2013/04/microsoft/





Microsoft CFO Exits; Company Tops Earnings Expectations

Microsoft said on Thursday that Chief Financial Officer Peter Klein was leaving the company, as it struggles with sharply declining personal computer sales and a lukewarm reception for its new Windows 8 operating system.

Klein, an 11-year Microsoft veteran with 3 1/2 years as CFO, is the latest in a line of top-level executives to leave the company, following Windows head Steven Sinofsky last November. Some have questioned whether Chief Executive Steve Ballmer is still the right leader for Microsoft, whose shares have remained essentially flat for the last decade.

In announcing Klein's departure to employees, Ballmer praised Klein's part in the acquisitions of Skype and the social network Yammer, and said Klein "has had a profound impact on the finance profession overall, and exhibited good oversight on cost controls as CFO."

In his resignation letter, Klein wrote: "I am proud of the work that finance has done and the impact we have had on the Company. One reason that now is a good time to leave is that the organization is very strong, and I am delighted we will be naming an internal candidate. I couldn't be more optimistic about both the Company's and Finance's future."

Shares of world's largest software company clicked up after the closing bell, following the news.
http://www.nbcnews.com/business/micr...ions-1C9512386





Silicon Valley Companies Quietly Try to Kill Internet Privacy Bill
Steven Harmon

Silicon Valley tech firms, banks and other powerful industries are mounting a quiet but forceful campaign to kill an Internet privacy bill that would give California consumers the right to know how their personal information is being used.

A recent letter signed by 15 companies and trade groups -- including TechAmerica, which represents Google, Facebook, Microsoft and other technology companies -- demanded that the measure's author, Assemblywoman Bonnie Lowenthal, D-Long Beach, drop her bill. They complain it would open up businesses to an avalanche of requests from individuals as well as costly lawsuits.

One early consequence of the heavy lobbying: A hearing on the bill, AB1291, scheduled for last week, has been pushed to next month.

The American Civil Liberties Union, a co-sponsor of the Right to Know Act, accuses the business groups of overreacting to hide their true intentions: to keep out of the public's eye the lucrative practice of amassing personal information on people who use online services, computer apps, social networking sites and other portals that track people's locations, buying habits, favorite foods and movies, and even their sexual orientation.

"A lot of companies don't want consumers to know what's happening to their personal information," said Nicole Ozer, an attorney with the ACLU who specializes in privacy issues. "Companies are collecting and sharing this information with third parties in ways
the people might not realize and in ways they might not want."

The bill, which if passed would be the first such law in the nation, would require companies to show customers the personal data they've collected -- and tell them who's getting their hands on it. The information would have to be provided for free.

Supporters of the proposed laws argue that when consumers find out what kind of data businesses are compiling and sharing, they'll be better able to evaluate whether they should opt out of sharing it.

The push for the new law comes as tech, banking and marketing firms find more ways to mine vast amounts of personal information on consumers to target their specific needs. Some websites have installed as many as 100 tracking tools that kick in when consumers visit them, according to the bill's analysis.

Many Facebook apps tap into their users' and their friends' profiles, including sections on religious, political and sexual preferences; race; income; and health concerns. Third-party advertising and marketing companies buy, sell and trade personal information that they get from mobile phones, financial institutions and social media sites.

Some mobile applications share location information and phone numbers of users -- a concern to advocates of domestic violence victims.

Consumers who live in 27 countries that belong to the European Union already have the right to know what data companies have on them -- laws that are being complied by Facebook, Google and others that are opposing the California legislation.

Google did not reply to requests for an interview; a Facebook spokesman declined to talk about the bill. The California Chamber of Commerce referred all calls to TechAmerica, the trade group that represents major Internet companies.

Robert Callahan, the director of California government affairs for TechAmerica, told this newspaper: "Our companies are active proponents of ensuring that consumers' privacy is safeguarded. It is a fundamental part of their business model."

He said a 2005 California privacy law already enables consumers to ask what personal information companies are using. And businesses are aware that privacy protections are key to keeping customers' trust and to remaining competitive, he said.

Silicon Valley tech companies have the ears of local legislators.

Assemblyman Bob Wieckowski, D-Fremont, the chairman of the Assembly Judiciary Committee, where the bill is being considered, put off the bill until May 7 "because of concerns that the current version may be too broad and not clear enough to properly guide businesses on what they can and cannot do," said Jeff Barbosa, Wieckowski's spokesman.

Menlo Park-based Facebook and Mountain View-based Google are both in the district represented by Assemblyman Rich Gordon, D-Menlo Park, who said he hasn't made up his mind on the bill, but is looking for the "sweet spot" where privacy is protected "but you don't completely shut off Internet commerce. I'm trying to sort it out."

Lowenthal said she has no intention of dropping her bill, noting that California privacy laws haven't been updated since 2003, when the 2005 Shine the Light law was initially written.

At the time, she said, the main concern was telemarketing abuse. As a result, she said, companies now aren't required to reveal what information is shared unless it's for direct marketing purposes such as junk mail and telemarketing.

In addition, Lowenthal said, businesses now collect a wide range of personal information not included in the original law -- and are sharing and selling it in ways the authors did not anticipate.

"Ten years ago, there weren't the kinds of apps that mark your location, track your spending habits," Lowenthal said. "They go far beyond what the original privacy laws covered."
http://www.mercurynews.com/politics-...ternet-privacy





ISPs In ‘Conspiracy Of Silence’ With Government On Snooper’s Charter

Privacy groups accuse ISPs of betraying customers’ trust by colluding with the Government
Tom Brewster

Communications providers are conspiring with the government to keep quiet over the effects of the Communications Data Bill, known to critics as Snooper’s Charter. according to a challenging latter sent by major privacy activist groups

Under the proposed, communications providers could be ordered to store all customers’ comms data for a year, and give police access to the records via a “filter”,which would operate like a search engine for a vast database. Comms data does not include the content of communications, but the when, where and who, which is too far for opponents of the bill.

Big Brother Watch, Privacy International and the Open Rights Group have united in a strongly-worded letter accusing major UK telcos, including BT, Virgin, O2, Sky and TalkTalk, of complying with a government attack on privacy, and urging them to withdraw their co-operation.

‘Betraying customers’

“That your businesses appear willing to be co-opted as an arm of the state to monitor every single one of your customers is a dangerous step, exacerbated by your silence,” read the letter, seen by TechWeekEurope.

“Sadly, your customers have not had the opportunity to comment on these proposals. Indeed, were it not for civil society groups and the media, they would have no idea such a policy was being considered.

“We believe this is a critical failure not only of government, but a betrayal of your customers’ interests. You appear to be engaged in a conspiracy of silence with the Home Office, the only concern being whether or not you will be able to recover your costs.

“We urge you to withdraw your participation in a process that in our view is deeply flawed, pursuing a pre-determined solution that puts competition, security and privacy at risk in an unprecedented way.”

ISPs response

BT, Virgin and Sky declined to comment on the matter. TalkTalk, however, said the matter should be taken up with government, but it disagreed with the privacy activists’ assertions.

“Frankly it is wholly incorrect to suggest that ISPs are in a conspiracy with the Home Office. We have engaged with government in the process so they can understand the practical implications of their proposals,” the TalkTalk spokesperson added.

“We have always emphasised the need for consultation, the importance of protecting customers’ privacy and that we would only ever act in response to legislation.”

An O2 spokesperson said: “Telefónica UK and other communication providers gave evidence to the Joint Committee and all this was published in full last year. The next steps are a matter for the government.”

ISPs were involved in scrutinising the bill. Virgin said during the committee’s review process it was “critical that any measures are proportionate and delivered on the basis of reasonable checks and balances to ensure that the legitimate privacy of users is protected”.

A spokesperson for the ISP Association said: “ISPA has not seen the letter in question, so cannot comment on the content. We expect the government to publish the bill imminently and when this happens, we will work with our members, parliamentarians and other stakeholders as part of the parliamentary scrutiny the bill will receive.”

It is believed the government will deliver the full bill in the Queen’s Speech on 8 May. Home secretary Theresa May (pictured) said last week the Home Office had been redrafting the bill following heavy criticism from the Joint Committee tasked with scrutinising the plans.

Outside of the privacy issues, cost was one problem raised by the committee. The government has already spent Ł400 million, despite the danger the bill will not even make it through Parliament.

In total, the government said Ł1.8 billion would be spent to enforce the Act, covering spending over 10 years, but the committee agreed that was likely to be too low an estimate.

The government has been repeatedly accused of keeping its ears closed to criticism. Jimmy Wales, founder of Wikipedia, told TechWeek last year his protests had been ignored by May despite a number of meetings between them. Deputy prime minister Nick Clegg said the law makers had to go back to the drawing board and completely rewrite the bill.

The Home Office is now facing legal action, as the Information Commissioner’s Office has ordered May and her team to publish advice ministers were sent on the cost and design of the bill.

An ICO spokesperson said the government now has 30 days to respond with the details the privacy watchdog has asked for.

The notice relates to an ongoing Freedom of Information complaint currently being handled by the ICO. “We will then examine the material before deciding whether the information requested by the complainant should be disclosed,” the spokesperson added.
http://www.techweekeurope.co.uk/news...privacy-113891





CISPA in Limbo Thanks to Senate Apathy

Despite an $84 million lobbying effort, CISPA, the controversial bill aimed at making it easier for corporations to share customers' personal information with the government, faces an uncertain future after approval in the US House of Representatives.

The next step for the Cyber Intelligence Sharing and Protection Act, or CISPA, after passing by a 288 to 127 margin in the House, is a Senate vote. However, the Senate has yet to debate the bill and has given no indication that the proposal is a priority, as major issues including gun control and immigration linger in the national consciousness.

CISPA co-sponsor Rep. Mike Rogers (R-Mich.) of the House Intelligence Committee has maintained that the law would help corporations defend against supposedly inevitable cyber-attacks by striking “that right balance between our privacy, civil liberties and stopping bad guys in their tracks from ruining what is one-sixth of the US economy,” as quoted by the Associated Press.

If CISPA were to become law it would grant businesses and the government an unprecedented ability to share data without the need to consider anti-trust or classification laws. Hacked businesses would be granted legal immunity if they acted in “good faith” to protect their networks, thanks to a part of the bill whose broad language has drawn the ire of consumer and privacy advocates.

An initial version of the bill passed in the House of Representatives in 2012 but faded after a Senate filibuster. Last year only 40 Democrats supported the bill – though that number nearly doubled to 92 who voted for it in 2013. That seemingly sudden ideological shift followed an $84 million lobbying effort from major sponsors like Viacom, Time Warner, Verizon Wireless, and others, according to the Daily Tech.

The Electronic Frontier Foundation and American Civil Liberties Union, two of CISPA’s chief opponents, have warned that the legislation would reveal health records, credit information, and other information to the government without first being scrubbed by the companies turning over those files. The National Security Agency could then be granted access to those transmissions when investigating foreign hackers.

Google, Yahoo and Microsoft are among the tech companies that have supported the bill, but public backing has slowly eroded after Facebook revoked its support and a series of amendments in the House Intelligence Committee failed to sway the ACLU.

US President Barack Obama threatened to veto CISPA in 2012 and, citing privacy concerns, has kept his position with the current language of the bill. If CISPA overcomes the odds in the Senate, a presidential veto would again doom the law to months of debate in the House.
http://rt.com/usa/cispa-limbo-senate-apathy-294/





Australian Police Arrest Senior Member of LulzSec Hacking Group
Jane Wardell

Australian Federal Police have arrested the self-proclaimed leader of the international hacking group LulzSec, the collective that claimed responsibility for infiltrating and shutting down the CIA website.

Police said the 24-year-old IT worker, who held a position of trust at an international company, was arrested in Sydney on Tuesday evening and charged with hacking offences that carry a maximum penalty of 10 years.

Glen McEwen, manager of cyber crime operations at Australian Federal Police, said the man was detained at work, where he had access to sensitive information from clients including government agencies.

LulzSec, an offshoot of the international hacking group Anonymous, has taken credit for hacking attacks on government and private sector websites, including the Central Intelligence Agency (CIA), Sony Pictures, a unit of Sony Corp, 20th Century Fox and Nintendo.

Anonymous - and LulzSec in particular - became notorious in late 2010 when they launched what they called the "first cyber war" in retaliation for attempts to shut down the Wikileaks website.

The name LulzSec is a combination of "lulz", another way of writing "lols" or "laugh out loud", and security.

Australian police said the unnamed Australian man, who used the online moniker "Aush0k", was known to international law authorities.

His arrest comes a week after an American member of LulzSec, Cody Kretsinger, was sentenced in a Los Angeles court to a year in prison followed by home detention. Kretsinger, who used the online handle "Recursion", pleaded guilty in a plea agreement with prosecutors.

Court documents in that case revealed that Anonymous leader "Sabu", whose real name is Hector Xavier Monsegur, had provided the FBI with information on fellow hackers after pleading guilty to hacking offences.

The Australian hacker has been charged with two counts of unauthorized modification of data to cause impairment and one count of unauthorized access to a restricted data system after a government website was attacked earlier this month.

"Let me make it extremely clear to everybody out there, this is not harmless fun, this is serious," McEwen said at a press conference.

McEwen said the man posted in online forums frequented by other members of LulzSec that he was the group's leader.

"There were no denials of his claims of being the leader," McEwen told reporters.

The man has been granted bail and will appear before a court next month.

LulzSec allegedly broke into Australian government department and university websites in 2011. Anonymous last year took around 10 Australian government websites offline, protesting plans to force ISPs to store more user data and make it available to security services.

(Additional reporting by Michael Sin; Editing by Paul Tait and Jeremy Laurence)
http://www.reuters.com/article/2013/...93N02D20130424





Arrested LulzSec Hacker: He's One Of Us

AFP scalps hacker 'leader' inside Australia's IT ranks.
Darren Pauli, Allie Coyne

The Australian Federal Police have arrested a Sydney-based IT security professional for hacking a government website.

The self-proclaimed 'leader' of hacker movement LulzSec was arrested by police at his office in Sydney late yesterday and charged with three counts of unauthorised access to a computer system.

The unnamed 24-year-old, known online as Aush0k, resides in Point Clare on the Central Coast.

Police said he worked at the Australian operations of a large international firm offering IT security services, but declined to name the company. Research by iTnews and SC Magazine has since discovered the man is Matthew Flannery, a low-level support consultant at Content Security.

Flannery was charged with hacking offences, and is alleged to have defaced a government website this month. The AFP confirmed it was not a Federal Government website.

"He took advantage of a known exploit to access the website, then put a backdoor in" to gain further access, said Detective Superintendent Brad Marden, national coordinator of cybercrime operations at the Australian Federal Police.

Flannery was alleged to have also defaced the site by posting an image and 'altered' the internal structure of the site.

He is the first alleged member of the LulzSec group to be arrested by the AFP.

The AFP said Flannery was an IT professional and held a "position of trust" within his unnamed company, with access to "sensitive information from clients including government agencies". He had the potential to access data stored on the affected website but it did not appear he had done so, the AFP said.

His knowledge and skills presented "a significant risk to the clients of the company for which he was employed had he continued his illegal online activities," police said.

This has been disputed by Flannery's employer.

Content Security had no knowledge of his actions, according to the AFP.

Commander Glen McEwan, manager of the AFP's Cyber Crime Operations, said he wanted to get the message out that it was not 'harmless fun' to attack government websites.

"It is not about the magnitude of damage, its about the vulnerabilities that exist," he said. "No one has tacit consent to acceas such information. We are not dealing with a small, petty crime here."

Such access has "huge ramifications for society," he said.

The man has been bailed to appear May 15 at Woy Woy local court and must report to police three times a week.

LulzSec still in operation?

The AFP said the man had been invovled with LulzSec for some time, but they were not aware of his motives.

LulzSec claimed responsibility for a series of high-profile attacks against government agencies and large corporations during 2011.

The group claimed to have ceased activities by late 2011, but Detective Marden said sporadic hacks continue.

"There has been ongoing talk - it is not necessarily a group as such, people affilliate with these networks with other motivated individuals."

One simply becomes a member of LulzSec "by self-affilliation", he said.

It is unknown whether the arrested man engaged in other LulzSec operations, and no extradition has been sought from a foreign jurisdiction.

The arrest follows the one year jail sentence handed down to Lulzsec member Cody Kretsinger, aka Recursion, who pled guilty in April last year for an attack on Sony Pictures International.

Other members of the group have pled guilty to hacking offences - among them, group leader Hector Xavier Monsegur, known as Sabu.
http://www.itnews.com.au/News/340958...one-of-us.aspx





Dutch Suspect Sven Olaf Kamphuis Arrested for Biggest Cyber Attack in Internet History
David Gilbert

A suspect, believed to be Dutchman Sven Olaf Kamphuis, has been arrested in Spain in relation to the cyber-attack on Spamhaus, which has been called the biggest in the history of the internet.

While the authorities have only addressed the 35-year-old suspect as SK, IBTimes UK understands the suspect in custody is Sven Olaf Kamphuis who is affliiated with Stophaus, a group whose goal it is to shut down the anti-spam Spamhaus operation.

The suspect was arrested in Barcelona which is where Kamphuis currently lives according to his Facebook profile. He was taken into custody on a European arrest warrant and his home in Barcelona was raided with computers and mobile phones being seized.

The arrest in Spain came about following collaboration between authorities in different countries under the EU's judicial Cooperation Unit (Eurojust). Kamphuis is expected to be handed over to the Dutch Public Prosecution Service soon.

The distributed-denial-of-service (DDoS) attack, which took place over several days towards the end of March, was called the largest in internet history and hyperbolically compared to a nuclear bomb going off, by the company helping defend against the attack.

The company in question, CloudFlare, claimed it was the attack which nearly broke the internet.

While the attack was substantially larger than anything seen before at 300Gbps, its potential to "break the internet" has been discredited widely.

Importance

Spamhaus is a network which works to create a real-time blacklist of servers they believe are used to send out spam email. Such is its importance to how the internet works that in 2011 when a lawsuit threatened to shut it down, industry experts testified that doing so risked breaking the email infrastructure as we know it.

So pervasive is the system, it is estimated that Spamhaus is directly or indirectly responsible for filtering out as much as 80 percent of daily spam messages.

This resulted in the establishment of Stophaus, a group with the sole aim of stopping Spamhaus:

In a Facebook posting Kamphuis called Spamhaus "an offshore criminal network of tax circumventing self-declared internet terrorists pretending to be 'spam' fighters" that is attempt[ing] to control the internet through underhanded extortion tactics."
http://www.ibtimes.co.uk/articles/46...n-kamphuis.htm





Verizon Report: China Behind 96% of All Cyber-Espionage Data Breaches

Verizon's 2013 Data Breach Investigation Report is out and fingers China as the top source of cyber-espionage data breaches.
Ms. Smith

Verizon's 2013 Data Breach Investigation Report is out and includes data gathered by its own forensics team and data breach info from 19 partner organizations worldwide. The report covers about 621 confirmed breaches and about 47,000 security incidents that occurred in 2012. Security incidents do not necessarily mean the attackers were able to breach an organization and could include DoS attacks.

The motives for attacks were diverse. Verizon's Dave Hylender wrote, "Money-minded miscreants continued to cash in on low-hanging fruit from any tree within reach. Bolder bandits took aim at better-defended targets in hopes of bigger hauls. Activist groups DoS'd and hacked under the very different - and sometimes blurred - banners of personal ideology and just-for-the-fun-of-it lulz. And, as a growing list of victims shared their stories, clandestine activity attributed to state-affiliated actors stirred international intrigue."

China cyber espionage

China was involved in 96% of all espionage data-breach incidents, most often targeting manufacturing, professional and transportation industries. The assets China targeted within those industries included laptop/desktop, file server, mail server and directory server, in order to steal credentials, internal organization data, trade secrets and system info. A whopping 95% of the attacks started with phishing to get a toehold into their victim's systems. The report states that, "Phishing techniques have become much more sophisticated, often targeting specific individuals (spear phishing) and using tactics that are harder for IT to control. For example, now that people are suspicious of email, phishers are using phone calls and social networking."

Verizon's 2013 Data Breach Investigations Report profiling threat actors

It is unknown who the nation-state actors were in the other 4% of breaches, which the report says "may mean that other threat groups perform their activities with greater stealth and subterfuge. But it could also mean that China is, in fact, the most active source of national and industrial espionage in the world today."

Financially motivated data breaches

Eastern Europe (e.g., Romania, Bulgaria, and the Russian Federation) and the U.S. were the top actors in financially motivated breaches.

In the land of financially motivated breaches, spyware is king. Capturing data from payment cards swiped at POS terminals and credentials typed into online bank accounts are two very popular uses of these tools in cybercrime. As an aside, the use of spyware differs in espionage, where it focuses on grabbing screenshots of potentially valuable information and capturing user credentials to further spread the attack. RAM scrapers and network/system utilities ("adminware") are also major players in the financial crime space, and especially so in smaller organizations.

Contrary to popular belief

Many people incorrectly assume that sophisticated attacks are behind most data breaches, or else company insiders are to blame. However, 78% of the techniques were not sophisticated attacks, but were rated low - "basic methods, little of no customization or resources required" - or very low - "the average person could have done it." Also "contrary to popular belief, 86% of attacks do not involve employees or other insiders at all. Of the 14% of attacks that do, it's often lax internal practices that make gaining access easier than you would expect." Only 1% of breaches were attributed to "partner actors."

More than 90% of breaches reviewed came from "external actors," with about 80% related to financial crime and 20% involving cyber-espionage. Victims in the Americas fell prey to social engineering 42% of the time . . . more so than any other region in the world. That top threat action for our region was followed by 29% who became victims via attackers' spyware/keylogger malware.

Organizations spend a fortune on security, so "it's tempting to think that alarm bells must go off when a data breach happens. Sadly, they don't. 66% of the breaches in our 2013 report took months or even years to discover (62% months, 4% years). The problem is getting worse. In the 2012 DBIR, just 56% of breaches took a month or more to be discovered."

9% of all data breaches in the report were found by customers and more than half were spotted by end users. While end-users are often regarded as the weakest link, Verizon said they can be the greatest asset if they are trained how to spot breaches and how to avoid social engineering. IT teams were advised "to consider that complaints about system performance from users might be early warning signs of a breach."

Get a copy of Verizon's DBIR as it is packed with detailed and interesting information.
https://www.networkworld.com/communi...-data-breaches





Iceland’s Top Court Orders Valitor to Process WikiLeaks Payments
Omar R. Valdimarsson

Iceland’s Supreme Court ordered Valitor hf, the Icelandic partner of MasterCard Inc. (MA) and Visa Inc. (V), to process card payments for anti-secrecy website WikiLeaks within 15 days or face daily penalties.

If the company fails to comply it will be forced to pay 800,000 kronur ($6,800) in daily penalties, according to the ruling posted on the Reykjavik-based court’s website today.

The court also said Valitor must honor a contract with Icelandic data-hosting service provider DataCell. The payment card company had refused to process payments for DataCell because DataCell had signed a contract to process payments for WikiLeaks.

Valitor’s refusal to process WikiLeaks payments “shall be considered baseless,” according to the ruling posted on the Reykjavik-based court’s website. Valitor “is required to open a payment portal in accordance with its cooperation agreement” with DataCell.

Valitor Chief Executive Officer Vidar Thorkelsson didn’t immediately respond to a call for comment after regular business hours.
http://www.businessweek.com/news/201...leaks-payments





Law Professor Makes a Case for Legally Recognizing the Dangers of Surveillance

In The Dangers of Surveillance, law professor Neil Richards tackles the legal problem of surveillance law and making the courts understand why surveillance is harmful.
Ms. Smith

The Dangers of Surveillance, written by Neil M. Richards, Professor of Law at Washington University in St. Louis, was recently published on the Social Science Research Network. In it, Richards proposed "four principles that should guide the future development of surveillance law." Yet he said we must first recognize that: "Surveillance transcends the public-private divide;" that "secret surveillance is illegitimate;" that "total surveillance is illegitimate" and that "surveillance is harmful." The courts may understand that surveillance could be potentially harmful, but "have struggled to clearly understand why."The Dangers of Surveillance

Richards talks about intellectual privacy and how new ideas develop best when we are not being watched. You are being "watched" while reading digital textbooks or online articles, using e-readers to read books from Amazon or Barnes & Noble, and even with every click you make online. When you are being watched, "it interferes with intellectual privacy" which is "necessary to promote intellectual freedom. It rests on the idea that free minds are the foundation of a free society, and that surveillance of the activities of belief formation and idea generation can affect those activities profoundly and for the worse." From behavioral advertising, to Big Data collected by third parties, or data surveillance by the government, the watcher holds all power over the watched. "The fear of being watched causes people to act and think differently from the way they might otherwise."

"Surveillance scholars continually reaffirm that while surveillance by government and others can have many purposes, a recurrent purpose of surveillance is to control behavior," Richards wrote. "The bottom line about surveillance and persuasion is that surveillance gives the watcher information about the watched. That information gives the watcher increased power over the watched that can be used to persuade, influence, or otherwise control them, even if they do not know they are being watched or persuaded."

He tackles the Catch-22 problem that we've seen in the courts, where plaintiffs can only challenge secret government surveillance that they can prove and the government won't hand over the information to prove it. The law does not recognize that surveillance can cause "injury" and courts have "cast surveillance as a Fourth Amendment issue of crime prevention, rather than one which also threatens intellectual freedom and First Amendment values of the highest order."Banksy on surveillance

But Richards said that he wants to "advance two lines of critique to the notion that surveillance does not create a legally cognizable injury: first, that surveillance by government and private actors threatens intellectual privacy and chills the exercise of vital civil liberties; and second, that surveillance affects the power balance between individuals and those who are watching, increasing the risk of persuasion, blackmail, and other harmful uses of sensitive information by others."

My argument is not that intellectual surveillance should never be possible, but that when the state seeks to learn what people are reading, thinking, and saying privately, such scrutiny is a serious threat to civil liberties. Accordingly, meaningful legal process (that is, at least a warrant supported by probable cause) must occur before the government can perform the digital equivalent of reading our diaries.

Richards makes a case for the idea that surveillance is harmful. "A reasonable fear of government surveillance that affects the subject's intellectual activities (reading, thinking, and communicating) should be recognized as a harm sufficient to prove an injury in fact understanding doctrine."

He also touched on threats of total surveillance, but the ubiquitous surveillance of today is making that a reality.

A world of total surveillance would be one in which the power dangers of surveillance are even more menacing. In such a world, watchers would have increased power to blackmail, selectively prosecute, coerce, persuade, and sort individuals. A world of total surveillance is not just science fiction. It is the world toward which we are slowly creeping, as software is coded, databases are combined, and each CCTV camera is successively added to the network.

He wrote that there are:

many forms of surveillance - covert and overt, public and private - menace our intellectual privacy and the processes of belief formation on which a free society depends. They also create a power imbalance between the watcher and the watched that creates risks of blackmail, undue persuasion, and discrimination. Courts and legislatures should therefore scrutinize any surveillance that threatens these values. But because of their relationship to First Amendment values and political freedom, surveillance of intellectual records - Internet search histories, email, web traffic, and telephone communications - is particularly harmful.

In closing, Richards stated, "The alternative to grappling with the civil-liberties threats that surveillance poses is to ignore those threats altogether, to face the prospect of rendering widespread government surveillance unreviewable and uncheckable. Democratic societies can do better than that."

Neil Richards does a tremendous job of making a legal case, perhaps one that the courts would accept, of why surveillance is harmful. The italics are my emphasis on his thoughts, but in reality his whole paper for Harvard Law Review is worthy of emphasis. We desperately need to overhaul surveillance law. Richards' paper is only 38 pages long and I highly recommend that you download it and read it yourself when you have time so you can better grasp all the valid points he makes about The Dangers of Surveillance.
https://www.networkworld.com/communi...s-surveillance





Post Boston: Privacy Advocates Warn About Coming Tsunami of Surveillance Cameras

After Boston, there is a cry to increase surveillance cameras. But facial recognition technology didn't identify the bombing suspects. Privacy advocates warn that creating more of a surveillance society, further decreasing privacy, is not the answer.
Ms. Smith

In The Dangers of Surveillance, Neil Richards, law professor at Washington University in St. Louis, made a case for legally recognizing why surveillance is harmful. After what happened in Boston, Richards said, "There is going to be more of a push to have more cameras on the streets, and it will be difficult to resist that push. The difficult balance is to have them [cameras] there for extraordinary efforts such as what we've seen this week but not for us to live in an emergency situation all the time."Post Boston, Privacy advocates warn about coming tsunami of surveillance cameras

The "success of Boston surveillance" is being cited in St. Louis as validation "to link 150 surveillance cameras into a single security system." But Richards warned, "We have to carefully watch the watchers or we could end up with a level of public surveillance that nobody wants. The issue isn't that we don't want cameras but what kind of security state do we want and what privacy are we going to give up for it?"

Facial recognition technology "did not identify" the two bombing suspects, according to Boston Police Commissioner Edward Davis. "The work was painstaking and mind-numbing: One agent watched the same segment of video 400 times." The Washington Post pointed out that facial recognition "technology came up empty even though both Tsarnaevs' images exist in official databases: Dzhokhar had a Massachusetts driver's license; the brothers had legally immigrated; and Tamerlan had been the subject of some FBI investigation."

According to the Washington Post, part of the reason law enforcement publicly released the surveillance images of the suspects was to counter the vigilante version of See Something, Say Something, to "limit the damage being done to people who were wrongly being targeted as suspects in the news media and on the Internet." Citizens were so eager to help that the FBI site was overwhelmed with 300,000 hits per minute, at times crashing when its servers were overloaded.

Investigators were concerned that if they didn't assert control over the release of the Tsarnaevs' photos, their manhunt would become a chaotic free-for-all, with news media cars and helicopters, as well as online vigilante detectives, competing with police in the chase to find the suspects. By stressing that all information had to flow to 911 and official investigators, the FBI hoped to cut off that freelance sleuthing and attend to public safety even as they searched for the brothers.

There are about 150 surveillance cameras operated by government entities in the Boston area. Massachusetts Gov. Deval Patrick said surveillance footage from the bombing shows Dzhokhar Tsarnaev dropping his backpack and then calmly walking away from it before the bomb exploded. "It's pretty clear about his involvement and pretty chilling, frankly," Patrick said on NBC's "Meet the Press."

A flood of officials are calling for increased surveillance, including Rep. Peter King, former Homeland Security chairman, who said, "I do favor more cameras. They're a great law enforcement method and device. And again, it keeps us ahead of terrorists, who are constantly trying to kill us."

Yet EFF attorney Hanni Fakhoury said, "The only way to use these cameras to prevent crime is to have blanket surveillance, to have someone monitoring every intersection and nook and cranny, and that's where we have problems."

Immediately after the Boston tragedy, David Maynor, the CTO of Errata Security, warned, "If our current level of surveillance and personal intrusion did not stop this tragedy then nothing will. We must fight back by staying free."

Laura K. Donohue, a professor at the Georgetown University Law Center, told the Wall Street Journal:

"The U.S. has not just met London's standard, it has actually surpassed it," thanks to facial recognition and other technology. But American law doesn't yet provide clear limits on the use of such technology, because most of it is deployed in areas that are considered public space.

Alan Butler, an attorney with EPIC, added, "It's one thing to have private closed-circuit cameras and look at feeds after the fact. It's very different if you're talking about systems of cameras identifying and tracking people over time, all the time. Especially if you couple that with facial recognition and license-plate readers and databases."

"If you are not safe in your home and if you are not safe in the street, then your privacy becomes kind of a hollow concern," according to Jim Pasco, the executive director of the Fraternal Order of Police. "Law enforcement struggles daily with the balance between privacy and safety," Pasco told Politico. "Nobody is more mindful of it. But we're also mindful of the fact that technology moves at a warp speed and provides a unique opportunity to enhance public safety in a time when resources are strained and communications and transportations are so sophisticated. It's easier to be a criminal than a law-abiding citizen."

Jonathan Turley, a George Washington University law professor, warned us to think long and hard about whether surveillance cameras could prevent a terrorist attack in an urban area, before "creating a fishbowl society of surveillance." Turley wrote on USA Today:

No one is seriously questioning the value of having increased surveillance and police at major events. That was already the case with the Boston Marathon. However, privacy is dying in the United States by a thousand papercuts from countless new laws and surveillance systems. Before we plunge ahead in creating a fishbowl society of surveillance, we might want to ask whether such new measures or devices will actually make us safer or just make us feel safer.
https://www.networkworld.com/communi...llance-cameras





Boston Police Chief: Facial Recognition Tech Didn’t Help Find Bombing Suspects

Amid a huge volume of digital evidence, one agent watched same video 400 times.
Cyrus Farivar

While the whole country is relieved that this past week’s Boston Marathon bombing ordeal and subsequent lockdown of the city is finally over, Boston Police Commissioner Edward Davis told the Washington Post that the department’s facial recognition system “did not identify” the two bombing suspects.

“The technology came up empty even though both Tsarnaevs’ images exist in official databases: Dzhokhar had a Massachusetts driver’s license; the brothers had legally immigrated; and Tamerlan had been the subject of some FBI investigation,” the Post reported on Saturday.

Facial recognition systems can have limited utility when a grainy, low-resolution image captured at a distance from a cellphone camera or surveillance video is compared with a known, high-quality image. Meanwhile, the FBI is expected to release a large-scale facial recognition apparatus “next year for members of the Western Identification Network, a consortium of police agencies in California and eight other Western states,” according to the San Jose Mercury News.

Still, video surveillance did prove extremely useful in pinpointing the suspects.

“The work was painstaking and mind-numbing: One agent watched the same segment of video 400 times,” the Post added. “The goal was to construct a timeline of images, following possible suspects as they moved along the sidewalks, building a narrative out of a random jumble of pictures from thousands of different phones and cameras. It took a couple of days, but analysts began to focus on two men in baseball caps who had brought heavy black bags into the crowd near the marathon’s finish line but left without those bags.”

Authorities released official images to stave off Reddit

The Post also cited unnamed “law enforcement officials” who lambasted the use of Reddit and other social media sites that were attempting to work in parallel to the authorities.

“In addition to being almost universally wrong, the theories developed via social media complicated the official investigation, according to law enforcement officials,” the Post reported. “Those officials said Saturday that the decision on Thursday to release photos of the two men in baseball caps was meant in part to limit the damage being done to people who were wrongly being targeted as suspects in the news media and on the Internet.”

On the science side, two Boston medical researchers called for a special autopsy test to look for the presence of chronic traumatic encephalopathy (CTE), a boxing-related brain disease. Some wonder if the older brother, Tamerlan Tsarnaev, could have been affected by the disorder due to his history as an amateur boxer. According to this theory, damage from the sport could have led him towards erratic behavior and violence.

But according to the Boston Globe, those same researchers were extremely cautious. Even if medical examiners did find the presence of CTE, it would not be proof positive of a causal link to violent and extremist behavior.

“Is it possible that some changes might have gone on in his overall functioning due to his boxing and potentially related brain disease? Yes,’’ said Dr. Robert Stern, a co-founder of the Center for the Study of Chronic Traumatic Encephalopathy at Boston University, in an interview with the Globe. “Anything is possible. But to then jump to the disease leading to well-planned behavior like this? I couldn’t go there.’’
http://arstechnica.com/tech-policy/2...bing-suspects/





U.S. Gives Big, Secret Push to Internet Surveillance

Justice Department agreed to issue "2511 letters" immunizing AT&T and other companies participating in a cybersecurity program from criminal prosecution under the Wiretap Act, according to new documents obtained by the Electronic Privacy Information Center.
Declan McCullagh

Senior Obama administration officials have secretly authorized the interception of communications carried on portions of networks operated by AT&T and other Internet service providers, a practice that might otherwise be illegal under federal wiretapping laws.

The secret legal authorization from the Justice Department originally applied to a cybersecurity pilot project in which the military monitored defense contractors' Internet links. Since then, however, the program has been expanded by President Obama to cover all critical infrastructure sectors including energy, healthcare, and finance starting June 12.

"The Justice Department is helping private companies evade federal wiretap laws," said Marc Rotenberg, executive director of the Electronic Privacy Information Center, which obtained over 1,000 pages of internal government documents and provided them to CNET this week. "Alarm bells should be going off."

Those documents show the National Security Agency and the Defense Department were deeply involved in pressing for the secret legal authorization, with NSA director Keith Alexander participating in some of the discussions personally. Despite initial reservations, including from industry participants, Justice Department attorneys eventually signed off on the project.

The Justice Department agreed to grant legal immunity to the participating network providers in the form of what participants in the confidential discussions refer to as "2511 letters," a reference to the Wiretap Act codified at 18 USC 2511 in the federal statute books.

The Wiretap Act limits the ability of Internet providers to eavesdrop on network traffic except when monitoring is a "necessary incident" to providing the service or it takes place with a user's "lawful consent." An industry representative told CNET the 2511 letters provided legal immunity to the providers by agreeing not to prosecute for criminal violations of the Wiretap Act. It's not clear how many 2511 letters were issued by the Justice Department.

In 2011, Deputy Secretary of Defense William Lynn publicly disclosed the existence of the original project, called the DIB Cyber Pilot, which used login banners to inform network users that monitoring was taking place. In May 2012, the pilot was turned into an ongoing program -- broader but still voluntary -- by the name of Joint Cybersecurity Services Pilot, with the Department of Homeland Security becoming involved for the first time. It was renamed again to Enhanced Cybersecurity Services program in January, and is currently being expanded to all types of companies operating critical infrastructure.

The NSA and DOJ declined to comment. Homeland Security spokesman Sy Lee sent CNET a statement saying:

DHS is committed to supporting the public's privacy, civil rights, and civil liberties. Accordingly, the department has implemented strong privacy and civil rights and civil liberties standards into all its cybersecurity programs and initiatives from the outset, including the Enhanced Cybersecurity Services program. In order to protect privacy while safeguarding and securing cyberspace, DHS institutes layered privacy responsibilities throughout the department, embeds fair practice principles into cybersecurity programs and privacy compliance efforts, and fosters collaboration with cybersecurity partners.

Paul Rosenzweig, a former Homeland Security official and founder of Red Branch Consulting, compared the NSA and DOD asking the Justice Department for 2511 letters to of the CIA asking the Justice Department for the so-called torture memos a decade ago. (They were written by Justice Department official John Yoo, who reached the controversial conclusion that waterboarding was not torture.)

"If you think of it poorly, it's a CYA function," Rosenzweig says. "If you think well of it, it's an effort to secure advance authorization for an action that may not be clearly legal."

A report published last month by the Congressional Research Service, a non-partisan arm of Congress, says the executive branch likely does not have the legal authority to authorize more widespread monitoring of communications unless Congress rewrites the law. "Such an executive action would contravene current federal laws protecting electronic communications," the report says.

Because it overrides all federal and state privacy laws, including the Wiretap Act, legislation called CISPA would formally authorize the program without the government resorting to 2511 letters. In other words, if CISPA, which the U.S. House of Representatives approved last week, becomes law, any data-sharing program would be placed on a solid legal footing. AT&T, Verizon, and wireless and cable providers have all written letters endorsing CISPA.

Around the time that CIPSA was originally introduced in late 2011, NSA, DOD, and DHS officials were actively meeting with the aides on the House Intelligence committee who drafted the legislation, the internal documents show. The purpose of the meeting, one e-mail shows, was to brief committee aides on "cyber defense efforts." In addition, Ryan Gillis, a director in DHS's Office of Legislative Affairs, sent an e-mail to Sen. Dianne Feinstein (D-Calif.), chairman of the Senate Intelligence committee, discussing the pilot program around the same time.

AT&T and CenturyLink are currently the only two providers that have been publicly announced as participating in the program. Other companies have signed a memorandum of agreement with DHS to join, and are currently in the process of obtaining security certification, said a government official, who declined to name those companies or be identified by name.

Approval of the 2511 letters came after concerns from within the Justice Department and from industry. An internal e-mail thread among senior Defense Department, Homeland Security, and Justice Department officials in 2011, including associate deputy attorney general James Baker, outlines some of the obstacles:

[The program] has two key barriers to a start. First, the ISPs will likely request 2511 letters, so DoJ's provision of 3 2511 letters (and the review of DIB company banners as part of that) is one time requirement. DoJ will provide a timeline for that. Second, all participating DIB companies would be required to change their banners to reference government monitoring. All have expressed serious reservations with doing so, including the three CEOs [the deputy secretary of defense] discussed this with. The companies have informally told us that changing the banners in this manner could take months.

Another e-mail message from a Justice Department attorney wondered: "Will the program cover all parts of the company network -- including say day care centers (as mentioned as a question in a [deputies committee meeting]) and what are the policy implications of this?" The deputies committee includes the deputy secretary of defense, the deputy director of national intelligence, the deputy attorney general, and the vice chairman of the Joint Chiefs of Staff.

"These agencies are clearly seeking authority to receive a large amount of information, including personal information, from private Internet networks," says EPIC staff attorney Amie Stepanovich, who filed a lawsuit against Homeland Security in March 2012 seeking documents relating to the program under the Freedom of Information Act. "If this program was broadly deployed, it would raise serious questions about government cybersecurity practices."

In January, the Department of Homeland Security's privacy office published a privacy analysis (PDF) of the program saying that users of the networks of companies participating in the program will see "an electronic login banner [saying] information and data on the network may be monitored or disclosed to third parties, and/or that the network users' communications on the network are not private."

An internal Defense Department presentation cites as possible legal authority a classified presidential directive called NSPD 54 that President Bush signed in January 2008. Obama's own executive order, signed in February 2013, says Homeland Security must establish procedures to expand the data-sharing program "to all critical infrastructure sectors" by mid-June. Those are defined as any companies providing services that, if disrupted, would harm national economic security or "national public health or safety."

Those could be very broad categories, says Rosenzweig, author of a new book called "Cyber War," which discusses the legality of more widespread monitoring of Internet communications.

"I think there's a great deal of discretion," Rosenzweig says. "I could make a case for the criticality of several meat packing plants in Kansas. The disruption of the meat rendering facilities in Kansas would be very disruptive to the meat-eating habits of Americans."
http://news.cnet.com/8301-13578_3-57...-surveillance/





Judge Rejects FBI Attempt to Use Spyware to Infiltrate Unknown Suspect's Computer
Ryan Gallagher

Pursuing criminal hacking groups is high on the FBI’s list of priorities—but the bureau is adopting some hacking techniques of its own. And a Texas judge isn’t happy about it.

On Monday, a judge denied an FBI request to install a spy Trojan on a computer in an unknown location in order to track down a suspected fraudster. The order rejecting the request revealed that the FBI wanted to use the surveillance tool to covertly infiltrate the computer and take photographs of its user through his or her webcam. The plan also included recording Internet activity, user location, email contents, chat messaging logs, photographs, documents, and passwords.

As the Wall Street Journal reported, Houston magistrate Judge Stephen Smith said that he could not approve the “extremely intrusive” tactic because the FBI did not know the location or identity of the suspect and could not guarantee the spy software would not end up targeting innocents. Smith wrote in a 13-page memorandum:

What if the Target Computer is located in a public library, an Internet café, or a workplace accessible to others? What if the computer is used by family or friends uninvolved in the illegal scheme? What if the counterfeit email address is used for legitimate reasons by others unconnected to the criminal conspiracy? What if the email address is accessed by more than one computer, or by a cell phone and other digital devices? There may well be sufficient answers to these questions, but the Government’s application does not supply them.

According to court documents, the FBI wanted to use the software to identify a person responsible for allegedly violating computer security laws and committing federal bank fraud and identity theft. A criminal is said to have infiltrated the email of a Texas man and later tried to steal a “sizable” amount of money from his bank by transferring it to a foreign account. But investigators apparently admitted that they did not know the physical location of the suspect, creating a major legal roadblock in gaining surveillance approval. There are rules in place that put territorial limits on magistrate judges’ authority, so that they can issue warrants only for their own districts—in this case, the Southern District of Texas. Smith made it clear in his refusal that he was particularly uncomfortable authorizing the feds to “hack a computer” that could have been based anywhere in the world.

Perhaps what is most interesting is the level of detail the memorandum discloses about the surveillance technology at the FBI’s disposal. Back in 2007, the bureau was revealed to be using a spyware that could infect computers and gather IP addresses, the last visited website address, and a range of other metadata. But the spy Trojan disclosed in the Houston documents is far more advanced, capable of copying content and turning a person’s webcam effectively into a surveillance camera. According to Smith:

[T]he Government’s data extraction software will activate the Target Computer’s built-in-camera and snap photographs sufficient to identify the persons using the computer. The Government couches its description of this technique in terms of “photo monitoring,” as opposed to video surveillance, but this is a distinction without a difference. In between snapping photographs, the Government will have real time access to the camera’s video feed.

Sophisticated spy Trojans like the one described above are sold by companies that sell only to governments and law enforcement agencies—like England’s Gamma Group, which has developed a line of controversial “FinFisher” Trojan tools. It is possible that the FBI could have developed its own Trojan, but equally it may have procured the technology from a private company. Last month, I asked the feds whether they had ever purchased Gamma’s spyware, following a report that FinFisher servers had been detected in the United States. However, a spokesman for the bureau said that as a matter of policy it would not discuss “specific law enforcement tactics, techniques, or procedures, and we likewise would not be able to confirm specific products or services that the FBI may or may not purchase or use.”
http://www.slate.com/blogs/future_te...n_suspect.html





Nick Clegg ‘Kills Off Snooper’s Charter’

Over the Liberal Democrats’ dead body, says Clegg
Tom Brewster

Deputy prime minister Nick Clegg has promised to stop the Communications Data Bill, which would give the police greater access to personal communications data. Clegg pledged that the so-called “Snooper’s Charter” will not reach Parliament as long as the Liberal Democrats are in government.

Clegg made the comments during an interview on LBC radio this morning, saying: “What people dub the Snooper’s Charter, that’s not going to happen – certainly with Lib Dems in government.”

The bill, which is currently in draft form but was expected to appear in the Queen’s Speech on 8 May, would have let the government order communications providers, including the likes of Facebook and Skype, to store information on all citizens so law enforcement could easily access it.

It would provide a filter to police, allowing them to easily search through comms data, which does not include the content of messages, but the who, when and from where. The aim was to modernise policing laws to bring them in line with the current quality of comms technology.

The Bill has faced massive opposition from some within government, privacy advocacy spheres and in the tech industry. Wikipedia founder Jimmy Wales was a particularly vocal opponent, pointing out that the cost of the bill, estimated to reach at least Ł1.8 billion, was considerably more than the government had spent on fostering an exciting start-up community around London’s Tech City.

Some said that Britain’s start-ups would have their growth stunted if businesses were asked to store vast records of communications. Others criticsed the Bill on practical grounds, pointing out how easy it is to maintain anonymity on the Internet.

Privacy advocates and Liberal Democrat MPs are hailing Clegg’s comments as a victory, even though the Home Office is yet to comment on the matter. But being deputy prime minister, Clegg sees all bills before they become official and has vetoing power.

Theresa May said earlier this month the Home Office had taken the recommendations of the committee scrutinising the bill on board. She said it was in the process of redrafting the proposals, but that may now be to no avail.

“These Labour and Conservative efforts to have all of our web records stored and monitored by the government was an affront to basic liberty. The plans were based on patchy evidence, ignorance of modern technology and a complete disregard for our basic rights,” wrote Julian Huppert MP, who was on the committee scrutinising the draft bill.

“Put simply, they were anathema to our Party: the only British political party which is dedicated to protecting the rights of every citizen.

“This is truly an immense moment for any liberal, and every Liberal Democrat.”

Earlier this week, privacy groups wrote to ISPs, accusing them of colluding with the government in a “conspiracy of silence”over the Snooper’s Charter. Big Brother Watch, Privacy International and the Open Rights Group claimed customers were being betrayed, as they had not been asked whether they agreed to have their communications data collected.

“Recording the websites we look at and who we email would not have made us safer, as some of the country’s leading cyber security academics argued this week,” Big Brother Watch wrote.

“It would have made Britain a less attractive place to start a company and put British companies in the position of being paid by the government to spy on their customers, something that oppressive regimes around the world would have quickly copied.”

The Home Office told TechWeek it would not comment on the matter as the bill was still being worked on.

If the bill is dead, questions will likely be asked why the government has already spent Ł400 million in laying the groundwork for the law, which may now never make it to the Queen’s Speech.
http://www.techweekeurope.co.uk/news...charter-114390





WiFi Porn in Public Areas To Be blocked

Children will not be able to view pornography using wireless internet access offered in public places under plans to be unveiled by David Cameron.
The Prime Minister is to announce a Government-backed code of conduct which will mean that pornography is blocked in public spaces such as cafes and railway stations where children are likely to be present.
Robert Winnett

The Prime Minister is to announce a Government-backed code of conduct which will mean that pornography is blocked in public spaces such as cafes and railway stations where children are likely to be present.

Mr Cameron said that he wanted “good, clean WiFi” in public spaces which would give parents confidence that their children cannot access illicit websites on smart phones or mobile computers.

The Prime Minister said: “We are promoting good, clean, WiFi in local cafes and elsewhere to make sure that people have confidence in public WiFi systems so that they are not going to see things they shouldn’t.”

His intervention comes after a long-running campaign from children’s charities to ensure a blanket ban on unacceptable sites on public WiFi networks.

The Children’s Charities Coalition on Internet Safety wrote to BT, the country’s biggest internet provider, last month demanding urgent action.

Talks have been taking place for months between internet service providers and government officials over the new deal. It is not clear whether the internet firms will automatically impose the restrictions on access – or whether it will be the duty of shops and other public areas used by children to bar adult content.

The coalition of charities, which includes the NSPCC and The Children’s Society, last night welcomed Mr Cameron’s intervention.

John Carr, the organisation’s secretary, said: “We welcome any deal which is long overdue. Public access to the internet is a modern reality and we have to fund a way of dealing with this growing problem.”

Mr Carr said that he did not have an issue with venues used only by adults, such as casinos, allowing access to pornography. However, industry sources said that the decision on whether to automatically restrict access in hotels could prove a more contentious issue.

Charities believe that more children may be seeking to access illicit sites in public places as parents are offered more sophisticated tools to restrict certain web content at home.

The issue has risen up the agenda of the Coalition which has already backed plans for other web controls – with Mr Cameron appointing his own advisers on the issues. Much of the work has been spearheaded by Claire Perry, a backbench Conservative MP.

In recent times, WiFi has spread rapidly in public places and is now available in many cafes, restaurants, shops and even on public transport.

Speaking on the local election campaign trail, the Prime Minister said that the “clean” WiFi plans could help reinvigorate local high streets.
http://www.telegraph.co.uk/news/poli...e-blocked.html





Fifth Amendment Shields Child Porn Suspect From Decrypting Hard Drives

Judge says forcing man to unlock files would amount to self-incrimination.
Timothy B. Lee

A federal judge refused to compel a Wisconsin suspect to decrypt the contents of several hard drives because doing so would violate the man's Fifth Amendment right against self-incrimination. Judge William E. Callahan's Friday ruling ultimately labeled the issue a "close call."

Courts have wrestled with how to apply the Fifth Amendment to encrypted hard drives for several years. According to past rulings, forcing a defendant to decrypt a hard drive isn't necessarily self-incriminating, but forcing a defendant to decrypt a hard drive can amount to self-incrimination if the government can't otherwise show that the defendant has the password for the drive. In that case, forced decryption amounts to a forced confession that the defendant owns the drive.

For example, in one case a border patrol agent viewed incriminating files on a suspect's laptop during a border crossing. But the official then closed the laptop, causing the portion of the hard drive containing the files to be encrypted automatically and deprive investigators of access. The court ruled that because the government already knew the files existed and the suspect had access to them, compelling their decryption didn't force the suspect to implicitly admit the laptop was his.

The circumstances of the Wisconsin case were different. While police officers did find logs on the suspect's PC suggesting that incriminating files had been saved to an encrypted drive, the suspect had multiple encrypted hard drives in his apartment, and the government had no way of proving which specific hard drives, if any, contained the incriminating files in question. In theory, a guest might have used the man's computer to download the files and store them on a hard drive he didn't own. Or the hard drives containing the files might not be among the ones the police seized.

"Feldman’s act of production, which would necessarily require his using a password of some type to decrypt the storage device, would be tantamount to telling the government something it does not already know with 'reasonably particularity'—namely, that Feldman has personal access to and control over the encrypted storage devices," Judge Callahan wrote. "Accordingly, in my opinion, Fifth Amendment protection is available to Feldman. Stated another way, ordering Feldman to decrypt the storage devices would be in violation of his Fifth Amendment right against compelled self-incrimination."
http://arstechnica.com/tech-policy/2...g-hard-drives/





Google Glass Has Already Been Hacked By Jailbreakers

With a name like Glass, it was just asking to be cracked.
Andy Greenberg

Just days after its release to developers, Google’s Glass headset has already been hacked to give users full control of its Android operating system, according to Jay Freeman, a well-known Android and iOS developer who tested a known exploit for Android on Glass yesterday and announced his success on Twitter Friday afternoon. The “root” or “jailbreak” technique Freeman found would potentially remove any restrictions Google might place on Glass, though it’s not yet clear exactly what those restrictions might be in consumer versions of the device.

Freeman, who goes by the hacker handle “Saurik” and created the widely-used app store for jailbroken iOS devices known as Cydia, told me in a phone interview that he discovered yesterday that Glass runs Android 4.0.4, and immediately began testing previously-known exploits that worked on that version of Google’s mobile operating system. Within hours, he found that he could use an exploit released by a hacker who goes by the name B1nary last year to gain full control of Glass’s operating system.

“It took me two hours while I was having dinner with friends at the time,” Freeman wrote to me. “The implementation from B1nary is for normal Android tablets and phones, I learned how it worked and then did the same thing on Glass…which was quite simple.”
Freeman, who obtained his Glass unit through a program for developers, says he’s not exactly sure yet what gaining root access to Glass might make possible. (He says he hasn’t been able to use his much due to his own eyeglasses prescription, which has made focusing on the device’s display painful for more than a few minutes at a time.) But he speculates that jailbreaking Glass could make it possible to store data locally on the device or on Bluetooth-linked phone, rather than upload it automatically to Google’s servers, a measure that some privacy-conscious users may appreciate.

Another possible function of rooting Glass (my speculation, not Freeman’s) could be to cut off Google’s ability to remotely “brick” the device, permanently disabling it if the user violates Google’s terms of use, a trick that recently came to light when one Glass owner tried to sell his early test unit on eBay despite Google’s warning not to.

Freeman says he was able to hack Glass using the device’s debug mode and a flaw in its backup function that tricks the device into thinking it’s running as an emulation on a developer’s machine. As he described it to me:

You take a backup from the device, modify the backup, and then restore the modified backup to the device. While the backup is restoring, you make a change to the data being restored that redirects the data being restored to overwrite a critical configuration file. This makes the device think that it is not running on real hardware: you make it think it is instead running on the emulator used by Android developers to test their software on desktop/laptop computers. As the emulator is designed for developers, it has full control and gives you “root”.

Freeman isn’t the only hacker tinkering with Glass. Another developer named Liam McLoughlin had already achieved root access to Glass the day before, according to the blog 9to5Google.

It’s not yet clear whether the exploits Freeman and McLoughlin used will work on consumer versions of Glass rather than developer versions. Freeman says that he spoke with a Google employee who was surprised that Freeman’s device had debug mode enabled, and commented that he thought it had been taken out of the latest version.

Unlike Apple, however, Google has long taken a friendly approach to those who hack its mobile devices, even allowing users and OEMs to root its devices with sanctioned methods. I’ve reached out to Google for comment on whether and how it will respond to developers hacking its new headset ahead of Glass’s 2014 release, and I’ll update this post if I learn more.

This much is clear: If Google does intend to keep a tight lock on Glass, it’s already a step behind the hackers who want to unlock it.
http://www.forbes.com/sites/andygree...-jailbreakers/





The Genius Of Google Fiber
Matt Asay

As Google picks up its pace on rolling out fiber Internet service - announcing Austin, Texas, and Provo, Utah in the past 10 days - one has to admire the sheer hubris of what it's doing. Just as in mobile, Google is forcing the industry to provide low-cost access to the Internet, where it stands waiting to reap the bonanza of advertising-based services. Competitors race to keep up, expanding their broadband or mobile offerings, thereby furthering Google's monetization strategy even as they try to thwart the advertising giant.

It's Google's world. We just get to live in it. And click on ads.

Free Fiber Internet For the Huddled Masses

According to Internet entrepreneur Jason Calacanis, the broadband Internet access game is already over, and Google has won. As he notes, "Google Fiber is not a test, it's a takeover plan." Calacanis argues that Google's real plan with fiber-to-the-home isn't necessarily the home broadband connection, but rather free wifi attached to each of the routers installed to use its broadband. With this free wifi network blanketing a city, it's game over for the traditional telcos:

"Google is going to kill AT&T, Verizon, Sprint, T-Mobile and the cable companies. Kids don’t talk on the phone and they don’t have a ton of money. If they can be reasonably sure they’ll have a wifi network, then they are simply not going to sign up for AT&T or Verizon."

While Calacanis insists that the free wifi component is "not announced, but it’s gonna happen," the reality is that it needn't happen for Google to win. (Underscoring Calacanis' point, however, Google has announced that it will offer free Wifi in its first fiber-enabled city, Kansas City, though this doesn't seem to be tethered to home broadband connections.) All Google needs is to spark competition, as has already happened in Austin. Within minutes of announcing Google Fiber there, AT&T declared that it, too, would offer 1 Gibabit Internet service to Austin.

Think Google minds? Not a bit.

After all, Google isn't in the Internet service provider (ISP) business. It's in the advertising business. All it needs to do is shame ISPs into offering better service, which service Google will co-opt to advertise against, not to mention use to provide a range of other "free" services like Voice, Apps, etc.

Google's "Free" Playbook

If this sounds familiar, it's because it is. Google has done much the same in mobile with its Android operating system. Worried that Apple would throttle access to the mobile Internet, Google built Android, released it as open source, and encouraged (even subsidized) its adoption.

A few short years later, Google chairman Eric Schmidt this week told the crowd at the AllThingsD mobile conference that there will be 1 billion Android phones blanketing the planet by year's end, a number set to nearly double within a year or two.

"Android is by far the primary vehicle by which people are going to see smartphones," Schmidt declared. "Our goal is to reach everybody."

But even if Google doesn't do this directly; even if Android reaches the masses through "competitors" like Samsung or Amazon, Google wins. Google wins every time people access the Internet, because odds are they will spend time with Google Search or other Google products.

Not Just An Advertising Play

Nor is free fiber and free mobile simply an advertising play. Google's free services often have a bigger goal in mind: amassing massive quantities of data. As Tim O'Reilly discovered from Google's director of research Peter Norvig years ago, the secret to improved translation services wasn't better algorithms, but rather more data. Google Fiber lets Google sit inside one's home, "collect[ing] information that users of your subscription provide, such as clicks on a Google Fiber TV remote to change the channel or search program listings," in addition to continued monitoring of how its Fiber customers use the Internet.

That's a lot of data, roughly none of which will gather dust in some musty data center.

None of this suggests that Google is somehow evil for enticing consumers to give up data or clicks in exchange for free services. But it is a recognition that few companies can afford to play the long game like Google. AT&T may offer Austin gigabit Internet service, but AT&T's only current way of monetizing those services is through monthly access fees. Google can give broadband Internet away, confident that it can recoup that investment over the long haul with both advertising and more data.

It's ambitious. It's farsighted. It's genius.
http://readwrite.com/2013/04/19/the-...f-google-fiber





Look Out Google Fiber, $35-A-Month Gigabit Internet Comes to Vermont
Shalini Ramachandran

Heads up Google Fiber: A rural Vermont telephone company might just have your $70 gigabit Internet offer beat.

Vermont Telephone Co. (VTel), whose footprint covers 17,500 homes in the Green Mountain State, has begun to offer gigabit Internet speeds for $35 a month, using a brand new fiber network. So far about 600 Vermont homes have subscribed.

VTel’s Chief Executive Michel Guite says he’s made it a personal mission to upgrade the company’s legacy phone network, which dates back to 1890, with fiber for the broadband age. The company was able to afford the upgrades largely by winning federal stimulus awards set aside for broadband. Using $94 million in stimulus money, VTel has invested in stringing 1,200 miles of fiber across a number of rural Vermont counties over the past year. Mr. Guite says the gigabit service should be available across VTel’s footprint in coming months.

VTel joins an increasing number of rural telephone companies who, having lost DSL share to cable Internet over the years, are reinvesting in fiber-to-the-home networks.

The Wall Street Journal reported earlier this year that more than 700 rural telephone companies have made this switch, according to the Fiber to the Home Council, a trade group, and Calix Inc. , a company that sells broadband equipment to cable and fiber operators. That comes as Google’s Fiber project, which began in Kansas City and is now extending to cities in Utah and Texas, has raised the profile of gigabit broadband and has captured the fancy of many city governments around the country.

“Google has really given us more encouragement,” Mr. Guite said. Mr. Guite said he was denied federal money for his upgrades the first time he applied, but won it the second time around–after Google had announced plans to build out Fiber.

Incumbent cable operators have largely downplayed the relevance of Google’s project, saying that it’s little more than a publicity stunt. They have also questioned whether residential customers even have a need for such speeds.

Mr. Guite says it remains to be seen whether what VTel is doing is a “sustainable model.” He admits that it’s going to be hard work ahead of VTel to educate customers about the uses of gigabit speeds. Much like Google Fiber in Kansas City, VTel has been holding public meetings in libraries and even one-on-one meetings with elderly folks to help them understand what gigabit Internet means, Mr. Guite said.
http://blogs.wsj.com/digits/2013/04/...es-to-vermont/





AT&T: Antitrust Regulators Playing Favorites
Danny Yadron

AT&T Inc. accused antitrust regulators Thursday of playing favorites as they seek to steer some of the country's most valuable airwaves towards smaller wireless carriers.

The government plans in coming years to auction off some of the airspace used by broadcast television stations to make more room for mobile broadband. As Americans flock to data-guzzling smartphones made by Apple Inc., Samsung Electronics Co. and others, wireless companies have sometimes struggled to provide enough bandwidth.

The airwaves, or spectrum, up for sale are located in the lower frequency range and are ideal for beaming data over long distances or through walls.

In a filing this month, the Justice Department called on the Federal Communications Commission, which will run the auction, to give the nation's smaller wireless companies—Sprint Nextel Corp. and T-Mobile USA—a leg up. The Justice Department argued that market leaders AT&T and Verizon Wireless, majority owned by Verizon Communications Inc., already own almost all of this valuable airspace and said they could box out their smaller rivals to prevent competition.

In a caustic response Thursday to the FCC, AT&T countered it would violate federal law for the commission to pick "winners and losers."

"It is surprising that the Antitrust Division of the Department of Justice would even propose measures that are so nakedly designed to help specific companies," Wayne Watts, AT&T's lawyer and senior executive vice president, wrote.

House Republicans have made similar remarks lately, arguing that the statute creating the auction bans the exclusion of companies. The sell-off could raise less money for the Treasury, they argue, if the biggest bidders can't bid, they argue.

AT&T also mentioned the foreign corporate connections of Sprint, which Japan's SoftBank Corp. is trying to acquire, and T-Mobile USA, which is owned by Germany's Deutsche Telekom AG.

"Certainly it would be news to the American taxpayers that they are expected to subsidize spectrum purchases by two large companies," Mr. Watts wrote.

In a written statement, T-Mobile said it "agrees with the competition experts at the Department of Justice" and wants "strong competitive rules" in the auctions.
http://online.wsj.com/article_email/...TEyNDUyWj.html





HTC Does What Google Wouldn't: Sell an LTE Phone That Sidesteps AT&T

A barely-advertised version of HTC's stellar One is breaking critical ground
Chris Ziegler

You won't see it advertised on billboards or television, you won't hear it mentioned in a carrier store, and your less technologically-savvy friends most certainly won't know about it — but quietly, HTC's done something extraordinarily important this month: it's broken AT&T's stranglehold on its nationwide LTE network.

I can't underscore enough what a big deal this is. It's a move that even Google, for all its money, power, and influence, didn't make with the Nexus 4.

Like T-Mobile and essentially every other carrier in the world that relies exclusively on a SIM to identify your phone on the network, AT&T will happily let a customer bring their own hardware — you don't need to buy an AT&T-branded phone to use the service. But since AT&T's LTE airwaves launched in 2011, the only flagship phones and tablets capable of actually using it have been AT&T-branded, meaning that you're subject to all the typical heartache that comes with owning carrier-branded equipment: pre-installed crapware, glacial firmware update schedules that are at the mercy of carrier testing and approval, ugly carrier logos, the list goes on. If you've wanted to avoid the mess, you've typically had to import a gray-market phone from Europe or Asia that only supports HSPA or HSPA+, not LTE. That's no good, particularly on a congested network where you need as many technological advantages as you can get.

"I did a double-take when I saw it"

Apple took the first legitimate swipe at that LTE lock-in last November with the US launch of the unlocked iPhone 5. But there's Apple ... and there's everyone else. Of course, the locked iPhone 5 lacks crapware, so it's not as big of a deal. And what if you don't want an iPhone? What if you prefer Android?

That brings us back to HTC, which has started shipping both 32 and 64GB versions of the superlative One — an early contender for the best phone of 2013, and arguably the best Android phone ever made — in a carrier- and bootloader-unlocked version that supports both T-Mobile and AT&T LTE. No strings attached. Go ahead, check it out. I did a double-take myself. And even more remarkably, it's sold for $574.99, $25 less than AT&T's full price for the locked, crapware-laden version of the same phone. I've confirmed with HTC that this unlocked version will get firmware updates according to its own schedule, not AT&T's; if history is any indication, that means you're likely to get Android 4.2 (and beyond) much faster. Sony is starting to offer the Xperia ZL as well, but it's nearly $200 more and — as our review of the very similar Xperia Z shows — the hardware and software simply aren't as good.

It's upsetting that we've become so accustomed to carrier politicking that the notion of a great unlocked LTE phone from a top-tier manufacturer sounds absurd and improbable, but that's where we are.

"Do yourself a favor: don't buy it from a carrier store"

Of course, AT&T would prefer you not buy the unlocked version of this phone for obvious reasons: it can't get its own software in front of your face, it can't conform the phone to its own firmware update schedule, and it can't use hardware as leverage to sign you into another contract extension. And that's likely just one of a host of reasons that you won't see HTC heavily promoting this model's existence — HTC's relationship with AT&T, unfortunately, is still far more important than its relationship with end users. But the mere fact that this unlocked phone exists, and is being sold directly by HTC to customers in the United States, is an extraordinarily encouraging sign.

So if you're on AT&T, you're in the market for an HTC One, and you're not up for a deeply-discounted upgrade, do yourself a favor: don't buy it from a carrier store, buy it straight from the source. You'll end up with a far better phone, and you'll help send a message that this is how it should be.
http://www.theverge.com/2013/4/23/42...t-att-nonsense





Sprint Reports Quarterly Net Loss of $643 Million, Sees iPhone Sales Drop by a Third
Daniel Cooper

Sprint managed to lose a million customers and over a billion dollars last quarter. This time it's not quite as bad, with a net loss of $643 million on revenue that was broadly equivalent to the same quarter of last year (around $8.8 billion). Those following the carrier's big iPhone gamble will note that sales of Apple smartphones fell by around a third relative to last quarter, from 2.2 million down to 1.5 million. Total smartphone sales reached 5 million, which Sprint describes as "strong" and which helped it to slightly increase the amount of profit it makes from each postpaid customer. However, this wasn't enough to offset the impact of losing another half a million customers, specifically due to the continuing exodus of Nextel subscribers. Partly as a result of this, the company's revenues continue to be wiped out by its huge costs of doing business -- not that its potential suitors seem to mind.
http://www.engadget.com/2013/04/24/s...nings-q1-2013/





How Federal Distracted-Driving Guidelines Will Shape Your Next Phone
Damon Lavrinc

Uncle Sam wants automakers to make it impossible for you to text your wife, check Facebook and watch a video while you’re driving — suggestions that could have just as much impact on mobile phone manufacturers as automakers.

The guidelines – and they’re just that, suggestions, not requirements – are laid out in a 281-page report by the National Highway Traffic Safety Administration and the Department of Transportation, which under the direction of outgoing transportation secretary Ray LaHood have made distracted driving a pet cause.

“Distracted driving is a deadly epidemic that has devastating consequences on our nation’s roadways,” LaHood said in a statement. “These guidelines recognize that today’s drivers appreciate technology, while providing automakers with a way to balance the innovation consumers want with the safety we all need. Combined with good laws, good enforcement and good education, these guidelines can save lives.”

Distracted driving accounted for 10 percent of all traffic deaths in 2011, when 3,331 people were killed. That’s a slight increase from 2010, when 3,092 people died. But there’s some question about exactly what percentage of those fatalities and the overall crashes were caused by either in-car infotainment systems or mobile electronics.

The main thrust of the recommendations is limiting the amount of time the driver takes his eyes off the road or hands off the wheel, with a maximum of two seconds for each input and total of 12 seconds to complete a task. NHTSA wants automakers to disable certain functions of a car’s built-in infotainment systems whenever the vehicle is in motion.

Specifically, NHTSA wants automakers to nix the ability to enter text for messaging and internet browsing, disable any kind of video functionality (think Skype, FaceTime and watching the latest Lady Gaga video) and prevent text-based information from being displayed, including web pages, social media content, emails and text messages. Most of these features aren’t available at the moment and some automakers already restrict text input and display while driving, so a lot of these recommendations are future-proofing efforts.

Most of the recommendations are common sense, like limiting text input and what can be displayed on screens or the windshield. But others are more far reaching, like avoiding 3D or photorealistic images for navigation – something automakers like Audi and Ford have been rolling out in recent years.

But this is only the first part in a trilogy of recommendations to limit in-car distractions. NHTSA plans to release two more studies over the next two years to address mobile phones and other portable devices that could be used in vehicles, along with a study on voice-activated controls. Here’s where Samsung, HTC and Apple have something to worry about.

“Until such time as the Phase 2 Guidelines are issued, the agency recommends that developers and manufacturers of portable and aftermarket devices consider these principles as they design and update their products,” the guidelines state. “NHTSA further encourages these developers and manufacturers to adopt any recommendations in the Phase 1 Guidelines that they believe are feasible and appropriate for their devices.”

Auto industry lobbyists have campaigned hard against some restrictions, and we’ll certainly see similar efforts from the electronics sector and carriers.

The Auto Alliance, which represents a dozen automakers, including BMW, Chrysler, Ford, General Motors, Mercedes-Benz, Toyota and Volkswagen, is already squawking about the feds failing to include consumer electronics in the initial recommendations.

“Drivers want that function in their dashboard systems, and we think it makes sense to provide it as a means of discouraging drivers from using hand-held phones as GPS systems,” the trade group said in a statement. “Our concern is that limiting built-in systems without simultaneously addressing portable devices could result in drivers choosing not to connect their phones in order to access the functionality they want.” According to NHTSA’s findings, that can increase the risk of a crash by three times.

Global Automakers’ President and CEO Michael J. Stanton had a similar reaction, saying, “Global Automakers supports bans on the use of hand-held devices for texting and phone calls while driving. In our view, to be effective, the NHTSA guidelines should be comprehensive and address these portable devices as well.”

While the safety benefits of ensuring drivers keep their eyes on the road are unassailable, there’s some question about how big of a public health crisis distracted driving is. As the Auto Alliance points out, “NHTSA data indicate that 98% of distraction-related accidents are due to factors other than use of the built-in system.”
http://www.wired.com/autopia/2013/04...-distractions/





Winamp’s Woes: How the Greatest MP3 Player Undid Itself

15 years on, Winamp still lives—but mismanagement blunted its llama-whipping.
Cyrus Farivar

MP3s are so natural to the Internet now that it’s almost hard to imagine a time before high-quality compressed music. But there was such a time—and even after "MP3" entered the mainstream, organizing, ripping, and playing back one's music collection remained a clunky and frustrating experience.

Enter Winamp, the skin-able, customizable MP3 player that "really whips the llama's ass." In the late 1990s, every music geek had a copy; llama-whipping had gone global, and the big-money acquisition offers quickly followed. AOL famously acquired the company in June 1999 for $80-$100 million—and Winamp almost immediately lost its innovative edge.

Winamp's 15-year anniversary is now upon us, with little fanfare. It’s almost as if the Internet has forgotten about the upstart with the odd slogan that looked at one time like it would be the company to revolutionize digital music. It certainly had the opportunity.

“There's no reason that Winamp couldn’t be in the position that iTunes is in today if not for a few layers of mismanagement by AOL that started immediately upon acquisition,” Rob Lord, the first general manager of Winamp, and its first-ever hire, told Ars.

Justin Frankel, Winamp's primary developer, seems to concur in an interview he gave to BetaNews. (He declined to be interviewed for this article.) “I'm always hoping that they will come around and realize that they're killing [Winamp] and find a better way, but AOL always seems too bogged down with all of their internal politics to get anything done,” he said.

The problems began early, since Nullsoft wasn't interested in being a traditional corporate unit. For instance, in 2000, just a year after the acquisition, Frankel released (and open sourced) Gnutella, a new “headless” peer-to-peer file-sharing protocol that understandably steamed the bigwigs at AOL corporate headquarters in Dulles, Virginia.

By early 2004, Rolling Stone dubbed Nullsoft’s founder the “world’s most dangerous geek”—but companies like AOL aren't good fits for dangerous geeks. That same year, Frankel resigned, writing on his website a few lines that were later removed: "For me, coding is a form of self-expression. The company controls the most effective means of self-expression I have. This is unacceptable to me as an individual, therefore I must leave."

Today, Winamp continues to be updated; AOL released its first Android version in 2010 and a Mac version in 2011. Amazingly, given all the time elapsed, AOL still makes a decent amount of money on the site and on the program—while the company has declined to release official figures, former employees who worked on Winamp estimate its current revenue at around $6 million annually. And Winamp still has an estimated user base of millions worldwide, a small fraction of which live in the United States.

However, references to the application’s storied history, both good and bad, have been scrubbed or omitted from the Winamp current site—it’s just a big blank page. (Update: An Ars reader points out that the history page has moved, but the link to the alumni page still reverts back to the home page.) So how exactly did Winamp squander the incredible head start it had on most other Internet music businesses? Here's how.

Out of the desert

Like most companies, Winamp was created to solve a “pain problem.” That problem? Two decades ago, it was pretty difficult to organize and play compressed music, which had just started to enter mainstream usage.

The German scientists behind the MP3 format released their first encoder in July 1994, but for the next three years, it remained difficult to share and find the resulting music files. Frankel has always created software “because it was software that I wanted to be able to use,” as he told the Digital Tools blog in 2008. “Winamp grew out of wanting a good, enjoyable way to listen to MP3s on a computer. It wasn’t the first MP3 player, but the MP3 players around before it were hard for me to want to use.”

Prior to Winamp, there wasn’t much available beyond Windows Media Player or RealPlayer. But none of those players could, in the mid-1990s, do something as basic as playlists, much less visualizations and custom skins, nor were they as tightly and efficiently programmed as Winamp. Even today, the Mac version of the Winamp installer is only 4.2MB; by comparison, the iTunes Mac installer comes in at a whopping 170MB.

The Windows Advanced Multimedia Products (WinAMP) player was released to the world on April 21, 1997. The next year, when its parent company Nullsoft formally incorporated, Winamp became $10 shareware. But no one pays for shareware, right? Wrong.

“Nothing ever was broken [if you didn’t pay], there was no feature that was unlocked,” Rob Lord told Ars. “In that year before we were acquired, we were bringing in $100,000 a month from $10 checks—paper checks in the mail!”

At the time, Lord already had staked his first claim to fame: co-founding the (recently revived) Internet Underground Music Archive, the world’s first online legal music repository, while he was a student at the University of California, Santa Cruz. Today, Rob Lord works for his own startup, Sherpa.io, based in the Hatchery, a SoMa (South of Market) co-working space in San Francisco, just a five-minute walk from Twitter’s original offices, alongside a plethora of tech and tech media companies. Developers and entrepreneurs rub shoulders on sunny days in South Park, an adjacent outdoor space that features a gourmet grilled cheese outfit, a taqueria, and a French restaurant with killer quiches. In short, it’s a long way from Sedona, Arizona, Frankel’s hometown and the birthplace of Nullsoft.

Seated on a couch in a Hatchery conference room and dressed in a T-shirt, shorts and sandals, Lord told me about his role at Nullsoft that began in May 1999.

“My title was director of online strategy, although we didn't know what that meant,” he said. “It was a lot of strategic and tactical decisions, around everything except the coding of the app itself. Justin was the one coding on it and he was the only one who had access to source code. I was being helpful by [looking at] product features [on a] business level—I initiated the first monetizing of the website.”

It was Lord’s job to figure out how to make the company money. Like most 1990s startups, the plan involved banner ads and possible partnership deals with other startups. Lord, then in his late 20s, moved from California to join the 18-year-old Frankel, still living at his parents’ home in Sedona, Arizona—where his father, attorney Charles Frankel, acted as the company’s counsel and chief financial officer.

This 10,000-person community in the Arizona desert attracts millions of tourists per year, and for decades has been home to people seeking to enjoy the state’s natural beauty and to take in the “spiritual” side of the place.

“You have this rugged individualism and a very rugged spiritual set and [Frankel] came from that,” Lord said. The Sedona ethos came through while making business decisions; Lord recalled one moment when there wasn’t enough information to confidently come to a decision. “'We'll just do x and let the universe decide,'” he recalled Frankel saying. “I think it describes the mode we were in—things happen for a reason.”

Finding a buyer

The universe decided that Winamp was awesome. In the first two years that Lord worked with Nullsoft, Winamp’s user base quadrupled from 15 million to 60 million users—and the acquisition offers arrived. “There was no meeting that was ever turned down,” Lord recalled.

Few companies said it outright, but they would couch their queries in phrases like, “Do you guys have future plans?” Before long it became hard to resist valuation offers in the neighborhood of $100 million.

In June 1999, Nullsoft was acquired alongside Spinner (in a deal worth $400 million for both), a streaming media player startup based in San Francisco. Charles Frankel, Justin’s father, took in the second largest portion of the AOL acquisition deal, receiving around $15 million in stock at the time. Frankel himself got AOL stock worth nearly $60 million at the time.

Lord now says Nullsoft was “acquired at the sweet spot of insanity,” less than a year before the January 2000 merger announcement of AOL and Time Warner, which eventually failed in spectacular fashion.

AOL consolidated both properties into Spinner's offices, a single warehouse-turned-office on Alabama Street in the Mission District. The move to San Francisco certainly provided a change of pace for tiny Nullsoft. “I felt this juxtaposition of [our new environment] with [previously being in Sedona with Frankel and] operating out of his bedroom and us having meetings at his dad's offices, on the one road in town,” Lord said.

Everyone involved in the deal expected big things to result.“The thesis at that time was that AOL could be really big in music, create within its four walls the next MTV—and that meant something in music in the 90s,” Fred McIntyre told Ars last month. McIntyre started off as a vice president at Spinner in 1998 and worked directly with Winamp until 2004, staying on at AOL. He returned to Winamp in 2007.

“The general logic was that Spinner had built a service and had a pretty well seasoned management team in place,” McIntyre added. “Winamp had built a product and a platform that was capable of generating meaningful user adoption.”

“AOL, without telling either of us, bought us both,” recalls Josh Felser. Felser was co-founder and president of Spinner from late 1997 until mid-1999, and later became an AOL vice president in charge of both units. Today, he's a venture capitalist at Freestyle Capital. “They threw us together and I was in charge of both brands. It was obvious that our cultures were different, but it wasn't obvious that they would clash.”

At first, Winamp kept riding high. “[Winamp.com] was doing hundreds of millions of page views a month in late 1990s,” McIntyre said. “We were just pushing display ads through those. That was in and of itself a lucrative business—not a sexy business, but a lucrative business nonetheless.”

But problems quickly became apparent.

Culture clash

Former employees say that a deep chasm existed between the corporate cultures of Spinner and Nullsoft. Worse still, with their simultaneous acquisition, sometimes it was unclear exactly who was in charge of what. The Nullsoft team, which at the time of the acquisition numbered only four people, was literally surrounded by Spinner staff, who had already been operating at desks along the perimeter of their old Potrero Hill warehouse space. When Nullsoft arrived, the crew set up camp in the middle of the large space with the help of a massive tarp.

Flush with cash, a confident Nullsoft had Lord and Frankel at its helm and oversaw the hiring of several post-acquisition employees, including Chamath Palihapitiya to work on product and business development. Seven years later, Palihapitiya went on to become a Facebook executive and part-owner of the Golden State Warriors. Last year, the New York Times lauded him as an “unconventional venture capitalist.”

“On my first day, I walked into the office—there was this huge tarp in the middle,” Palihapitiya recalled in a conversation with Ars.

“We had a converted sweatshop in Potrero Hill. There was a lot of light—this glass panel roof panel would tilt up to let air and sunlight in, but was really bright. The Nullsoft guys had this massive tarp, so it was always dark [for them]. I wanted to know: what's going on in that tarp?”

Palihapitiya, a Canadian whose family is from Sri Lanka, studied electrical engineering at the University of Waterloo; upon graduation, he worked for a year on the Interest Rate Derivatives Group at BMO Nesbitt Burns, a Canadian investment firm. But after a year working on Canada’s financial frontier, Palihapitiya got bored and applied for work with “every [company] I thought was doing interesting things.”

“I applied to Winamp, eBay, Google, and was rejected everywhere except Winamp,” he added. “I had decent technical skills. I have no idea why they hired me. I didn't really have any practical skills. It just seemed like a great company. To be honest, I knew so little, but I thought that these guys seem to be figuring out as they’re going along, so that's the best shot I have.”

Despite a lack of formal business training, Frankel, Lord, Steve Gedikian (now a senior manager at Apple), and Ian Rogers (now the CEO of Topspin) managed to grow Winamp’s business significantly. (Gedikian and Rogers also declined to be interviewed for this article.)

But friction with Spinner posed more problems than any tarp. One of the early problems between the sibling companies came after an AOL decision. AOL management decided that, despite Nullsoft's larger user base, Spinner was the more mature company with more traditional corporate leadership. As such, Spinner was effectively given administrative and financial control over the two units.

“There was a clash of parsing out the budget. [Rob Lord] was furious that Spinner was given control and budgeting was being given to Spinner more than Winamp, and Winamp was bigger than Spinner,” Josh Felser admitted to Ars.

“[Winamp] went from 15 million [in 1999] to 60 million [in 2001],” Rob Lord said. “It was perverse. We were in an office with Spinner, they had 40 to 60 people, we had four. We were 10 times the user base and our growth rate was much faster. It was a weird situation. We had bootstrapped the whole thing.”

"It could have been Pandora"

While Nullsoft seemed to play second fiddle to Spinner, all the companies in AOL’s own “Interactive Properties” group (including ICQ, MapQuest, and others) collectively played second fiddle to AOL’s traditional bread-and-butter moneymaker: “the Service.”

According to AOL’s own June 30, 2000 10-K filing with the Securities and Exchange Commission, its legacy Internet access service had 23.2 million users, compared to Winamp with its 25 million users. At the time, the Service made a huge amount of money, and AOL wanted to promote it heavily to a crowd with limited use for it.

One particularly bad corporate decision came in 2000, when Palihapitiya and McIntyre wrote the business case for what would have been the first music subscription service at AOL. But the idea wasn’t released as a product until 2003, under the “MusicNet” brand, two years after Rhapsody launched its own music subscription service in 2001.

Fred McIntyre claimed that one of the biggest reasons why AOL failed to capitalize on this music subscription plan was that the company insisted on using its own indigenous billing system, the one used for the Service.

“AOL was religious about this idea that we had to do billing through the same infrastructure that AOL did billing for service for,” he said, comparing it to the ill-fated decision by Yahoo to force Flickr users to use a Yahoo ID to log into the photo-sharing service.

And that pointed to a bigger problem for Winamp, and for the "Winamp culture" inside AOL—its primary users were music fans, geeks, and people who cared about what bitrate their MP3s were encoded at—in other words, the key users of Winamp in the early 2000s were allergic to AOL as a company. (Or perhaps were just put off by all those AOL promo CDs.)

“Winamp would have a larger US audience today were it not the fact that AOL tried to get people to install Netscape or AOL or something else when they installed Winamp,” McIntyre concluded.

Jascha Franklin-Hodge started out as a Spinner engineer and later became the director of software development in 2003. Later, he co-founded Blue State Digital, the company behind Barack Obama’s 2008 social media strategy.

“When you think about what AOL had in early 2000,” he told Ars, “the only thing that they were missing that [would be] essential to today’s media system is a hardware device. They had the number one software for playing [in Winamp], and in theory, although not in practice, the [Time Warner] content library that could have been a pioneer in streaming. And a radio service. It had all the elements. AOL could have been Spotify, it could have been Pandora.”

But it wasn't; it was AOL. And so, despite having the love of hardcore geeks, music fans, and millions of Winamp users, AOL’s main strategy was to try to convert those users towards the Service, ignoring or marginalizing other monetization strategies. As the years passed, both the Service and Winamp stagnated. (Today, AOL has just 3.3 million users.)

McIntyre summed up the problem bluntly. “Between 2002 and 2007, Winamp was an asset that AOL knew was valuable but didn't know what the fuck to do with."

Alternative histories

The other problem, of course, is that by late 2001, the first iPod appeared. As Steve Jobs himself famously pointed out at the product’s launch, there were existing MP3 players—but they all sucked. By 2003, Apple had sold a million iPods and launched the iTunes Music Store.

“Apple so thoroughly dominated and crushed that space,” Franklin-Hodge added. “I think it set the stage—those [26 million AOL users in the United States at the end of 2002] were a huge chunk of Apple’s initial customer base for the iPod. They were people who got why digital music was a more advantageous way to consume things. They created that door; we just weren’t positioned to walk through it in the way that Apple was.”

Other former employees agreed, blaming Winamp’s slow decline on AOL’s inability to capitalize on Winamp’s user base.

"AOL did more to negate progress than any company I've ever seen,” said Palihapitiya, Winamp’s early head of business development. “These bureaucrats viewed every decision as a political decision. Really good ideas would die on the vine.”

Even though MusicNet took time to start up, the limited download (and later subscription) music service was “crushing it” at first—that is, before iTunes took off over the course of 2003 and 2004. Had Winamp, Spinner, and AOL made different decisions, the history of digital music might have read quite differently.

“Nothing replaces execution,” Palihapitiya concluded. “I think the biggest general thing that happens in most acquisitions [is]: the acquirers tries to exert too much control on the acquiree. The host organism suffocates the young company. Some of it is not ill-intentioned. But that's just how most acquisitions end up. That was true in this case. If you had acquired [Nullsoft] and let it run as an independent operating unit, would it have done more? Probably.”

In the meantime, the core application, known for being thin, light, and fast, was suffering. In August 2002, Winamp version 3 was released (Nullsoft now had 15 employees) and had been re-designed. Some users felt it was bloated; many even reverted to older versions. By 2003, as iTunes and iPods were rising fast, Winamp struggled.

WASTE

But Frankel, the original creator of Winamp and Gnutella, wasn't out of ideas. Unfortunately, his ideas all made AOL furious.

Just as the RIAA was prepping lawsuits against Gnutella users, Frankel kept butting heads with AOL corporate headquarters in Dulles, Virginia—trying to get Nullsoft and himself out from AOL’s transcontinental reach. Besides Gnutella, which he released in September 2000, Frankel coded a program that blocked the ads on AOL Instant Messenger. After that, Dulles told him not to blog without approval.

"AOL as a company should not just sit on their asses and try to keep from losing as many subscribers as it can," he told Rolling Stone for its January 13, 2004 issue. "I mean, I'm a stockholder of the company. I want them innovating. I want them doing things that are good for the world and being socially conscious."

The disputes came to a head by mid-May 2003, when Frankel released WASTE, an encrypted, invite-only, file-sharing and chat network—on the fourth anniversary of Nullsoft’s acquisition. Not surprisingly, AOL pulled the plug within 24 hours.

Frankel described the tension to Rolling Stone in 2004:

“‘We fought off the AOL bullshit as much as possible," he says. When the company tried to insist that an AOL icon instantly appear on a user's desktop during a Winamp installation, Frankel hit the roof. "I'd be like, look, our users don't want to use AOL!" he says. "They think AOL sucks!"

Frankel agreed to stay on to see Winamp 5 through production; the program appeared in December 2003 and Frankel resigned from the company in January. Within a year, Gedikian resigned and AOL shuttered Nullsoft entirely, moving the remaining development staff to Dulles. At the time, Slate lamented the closure of the last “maverick tech company.”

Winamp on life support

Probably the most surprising piece of the story is that Winamp didn’t die right then and there in 2004. For the next three years, the software seemed more or less in stasis—no new version appeared.

Ben London, an AOL senior technical manager, took the reins of Winamp in Dulles in August 2004. He admitted that AOL’s own corporate strategy, which kept shifting, slowed down development.

“There’s just not a long-term investment tolerance,” he told Ars. “We carve out a six-month road map, and then boom, re-organization into a different group, and new, different drivers would ask us to focus on a different aspect of the product.”

But Winamp ticked along. When the new, 10-year-anniversary edition of Winamp finally dropped in 2007, Winamp hit its peak in the post-Frankel era, with a 90 million active user base, according to London.

“Winamp had no business staff,” said Sam Weber, a longtime AOL manager who eventually became Winamp’s business development director in 2006 and its overall director from 2007-2008. “Ben London was managing five developers that were keeping shoutcast.com, winamp.com, and the client on life support.”

Weber told Ars that he and his team figured out something surprising about Winamp. While its numbers eventually dropped to all but negligible levels in the United States, the international market was a different story.

“What do you do if you have 50 million users around the world and 90 percent are outside the US and you have a six-person team in DC?" Weber wondered. When the team looked closer, it found that it had five million Turkish Winamp users and two million Brazilian users, among others.

The Winamp team tried to come up with a new business plan for Winamp, wondering if they could tack on a download service, a streaming service, or even just sell advertising against the installs.

“I think bit-by-bit what we mostly did was try to revitalize the community by re-releasing the product, updating it, both in terms of user interface and the codecs and technology with it, making Shoutcast easier and friendlier to use,” he added. “We started monetizing users who came to the site, and more importantly, we translated it into a number of languages.”

In short, the new Winamp team in Dulles began to figure out what AOL should have realized years earlier.

“The first is don't screw up a good thing,” Weber said. “Don't use it as a mechanism for delivering AOL-branded services. Help make it more relevant to people who do use it.”

So Winamp 5.5 added official German, Polish, Russian, and French support for the first time. But more importantly, the company started to figure out how to make money from users through what came to be known as the “freemium” model.

“You sell a premium version of the product,” Weber said. “You've got this freemium play and it gets big enough, if you can get one percent [of your customers to buy it], you can build a real business.”

Currently, Winamp Pro sells for $20, which, when multiplied by hundreds of thousands of paid users, works out to millions of dollars in revenue. Another way to make money is by selling ads directly on Winamp.com—and with the site doing several million total unique visitors a month, it's an easy way to earn some cash.

But there’s an even better way to make money: put a Winamp player inside a browser toolbar. As Weber explained, this generates “a hell of a lot of money—search makes a lot more than banner ads.”

“Google has a [search] deal with AOL, so we're distributed AdSense, in a branded, Winamp sense,” he explained. “Now you've got millions of queries a day, and we would promote eMusic. Anytime someone searches for something, you're getting a piece of that. That's real money for a little startup. If the model hasn't changed since I was there, it’s advertising against a big audience.”

A second coming?

15 years after its founding, all of Winamp's original employees are long gone (most have moved on to other positions in Silicon Valley, largely in the tech and music sectors) and the product has now existed longer without Frankel than with him. Its user base continues to stagnate as competitors like Rdio, Spotify, and Pandora—to say nothing of iTunes, which last year sold its 15 billionth song—continue to thrive.

But Geno Yoham, Winamp’s general director since October 2008, argues that Winamp will continue to do well as a media player, particularly in emerging markets where Apple hasn’t penetrated as well.

“iTunes is number one, and we’re number two,” he said. "There's a lot of value in the Winamp brand, the media player that's on your side."

Winamp says that it has around 30 million users worldwide currently (a figured based on comScore Web traffic analysis), with less than one million in the United States. The company is also starting to target specific platforms (read: Android) rather than specific markets. Winamp reports that since the Android launch of Winamp in October 2010, it has seen over 19 million installs. Could Winamp rise once more?

“We're thinking about [buying Winamp] again,” said Josh Felser, the former Spinner executive and current venture capitalist, who said he and other investors also tried to buy Winamp from AOL in 2003. He's still in love with the idea of Winamp, and with the community it spawned, and believes that someone could still capitalize on all that potential.

"Winamp had the start of something social in music," he said, dismissing the music sharing that Spotify is now doing on Facebook. “That’s just seeing what people are listening to. It doesn't feel right.”

“[Winamp] had a very distinct, edgy, tech-savvy community, and that's a valuable community to lots of people. That would be a big thing to understand. What are the set of features that we can attach to it to make it become more relevant again? I don't have it. I’d have to get serious about that.”

But, he admitted, no significant steps have been taken in terms of talking with AOL about a possible acquisition.

“Although the idea of starting with that basis [of an existing community and a history] is exciting,” he said with a grin, “I haven't given it more than five minutes thought.”
http://arstechnica.com/business/2012...undid-itself/#





AP Twitter Account Hacked, Makes False Claim of Explosions at White House (update)
Chris Welch

Anyone that follows the Associated Press on Twitter just heard "news" of an unprecedented national crisis. "Two Explosions in the White House and Barack Obama is injured," the AP's account tweeted moments ago. Thankfully onlookers were quick to call the tweet fake, no doubt aided by the fact that no other news agencies are reporting a dire situation at the White House. The formatting is also uncharacteristic of the style guide-enforcing AP, with a bizarre capitalization of "Explosions" and a reference to the president by his first name. The news wire has since confirmed its account has been hijacked, referring to the tweet in question as "bogus."

That is a bogus @ap tweet.
— AP CorpComm (@AP_CorpComm) April 23, 2013

The (at)AP twitter account has been hacked. A tweet about an attack at the White House is false. We will advise on acct. status.
— AP Stylebook (@APStylebook) April 23, 2013


But effects of the major hack — not the first to impact a news agency on Twitter — are already being felt. The Dow plummeted nearly 100 points following the worrying tweet, though stocks have largely bounced back from the dive.
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The Associated Press account has since been suspended, an obvious measure to prevent further false information from being distributed by a typically reliable news source. The AP says today's intrusion came after hackers "made repeated attempts to steal the passwords of AP journalists" — a mission it would seem they ultimately succeeded at. One employee, Mike Baker, reveals that the hack came in close proximity to a phishing email received by AP staffers.

The @ap hack came less than an hour after some of us received an impressively disguised phishing email.
— Mike Baker (@MikeBakerAP) April 23, 2013


As for who's behind the brief scare, the Syrian Electronic Army, which took credit for a hack against Reuters last year, has claimed responsibility. A tweet from the @AP_Mobile account (also currently suspended) reads "Syrian Electronic Army Was Here."
http://www.theverge.com/2013/4/23/42...sident-injured





Conservative Koch Brothers Turning Focus to Newspapers

Tribune’s newspapers, including The Chicago Tribune, have caught the interest of a number of suitors.
Amy Chozick

Three years ago, Charles and David Koch, the billionaire industrialists and supporters of libertarian causes, held a seminar of like-minded, wealthy political donors at the St. Regis Resort in Aspen, Colo. They laid out a three-pronged, 10-year strategy to shift the country toward a smaller government with less regulation and taxes.

The first two pieces of the strategy — educating grass-roots activists and influencing politics — were not surprising, given the money they have given to policy institutes and political action groups. But the third one was: media.

Other than financing a few fringe libertarian publications, the Kochs have mostly avoided media investments. Now, Koch Industries, the sprawling private company of which Charles G. Koch serves as chairman and chief executive, is exploring a bid to buy the Tribune Company’s eight regional newspapers, including The Los Angeles Times, The Chicago Tribune, The Baltimore Sun, The Orlando Sentinel and The Hartford Courant.

By early May, the Tribune Company is expected to send financial data to serious suitors in what will be among the largest sales of newspapers by circulation in the country. Koch Industries is among those interested, said several people with direct knowledge of the sale who spoke on the condition they not be named. Tribune emerged from bankruptcy on Dec. 31 and has hired JPMorgan Chase and Evercore Partners to sell its print properties.

The papers, valued at roughly $623 million, would be a financially diminutive deal for Koch Industries, the energy and manufacturing conglomerate based in Wichita, Kan., with annual revenue of about $115 billion.

Politically, however, the papers could serve as a broader platform for the Kochs’ laissez-faire ideas. The Los Angeles Times is the fourth-largest paper in the country, and The Tribune is No. 9, and others are in several battleground states, including two of the largest newspapers in Florida, The Orlando Sentinel and The Sun Sentinel in Fort Lauderdale. A deal could include Hoy, the second-largest Spanish-language daily newspaper, which speaks to the pivotal Hispanic demographic.

One person who attended the Aspen seminar who spoke on the condition of anonymity described the strategy as follows: “It was never ‘How do we destroy the other side?’ ”

“It was ‘How do we make sure our voice is being heard?’ ”

Guests at the Aspen seminar included Philip F. Anschutz, the Republican oil mogul who owns the companies that publish The Washington Examiner, The Oklahoman and The Weekly Standard, and the hedge fund executive Paul E. Singer, who sits on the board of the political magazine Commentary. Attendees were asked not to discuss details about the seminar with the press.

A person who has attended other Koch Industries seminars, which have taken place since 2003, says Charles and David Koch have never said they want to take over newspapers or other large media outlets, but they often say “they see the conservative voice as not being well represented.” The Kochs plan to host another conference at the end of the month, in Palm Springs, Calif.

At this early stage, the thinking inside the Tribune Company, the people close to the deal said, is that Koch Industries could prove the most appealing buyer. Others interested, including a group of wealthy Los Angeles residents led by the billionaire Eli Broad and Ronald W. Burkle, both prominent Democratic donors, and Rupert Murdoch’s News Corporation, would prefer to buy only The Los Angeles Times.

The Tribune Company has signaled it prefers to sell all eight papers and their back-office operations as a bundle. (Tribune, a $7 billion media company that also owns 23 television stations, could also decide to keep the papers if they do not attract a high enough offer.)

Koch Industries is one of the largest sponsors of libertarian causes — including the financing of policy groups like the Cato Institute in Washington and the formation of Americans for Prosperity, the political action group that helped galvanize Tea Party organizations and their causes. The company has said it has no direct link to the Tea Party.

This month a Koch representative contacted Eddy W. Hartenstein, publisher and chief executive of The Los Angeles Times, to discuss a bid, according to a person briefed on the conversation who spoke on the condition of anonymity because the conversation was private. Mr. Hartenstein declined to comment.

Koch Industries recently brought on Angela Redding, a consultant based in Salt Lake City, to analyze the media environment and assess opportunities. Ms. Redding, who previously worked at the Charles G. Koch Charitable Foundation, did not respond to requests for comment.

“As an entrepreneurial company with 60,000 employees around the world, we are constantly exploring profitable opportunities in many industries and sectors. So, it is natural that our name would come up in connection with this rumor,” Melissa Cohlmia, a spokeswoman for Koch Companies Public Sector, said in a statement last month.

“We respect the independence of the journalistic institutions referenced in the news stories,” Ms. Cohlmia continued. “But it is our longstanding policy not to comment on deals or rumors of deals we may or may not be exploring.”

One person who has previously advised Koch Industries said the Tribune Company papers were considered an investment opportunity, and were viewed as entirely separate from Charles and David Kochs’ lifelong mission to shrink the size of government.

At least in politically liberal Los Angeles, a conservative paper could be tricky. David H. Koch, who lives in New York and serves as executive vice president of Koch Industries, has said he supports gay marriage and could align with many residents on some social issues, Reed Galen, a Republican consultant in Orange County, Calif., said.

Koch Industries’ main competitor for The Los Angeles Times is a group of mostly Democratic local residents. In the 2012 political cycle, Mr. Broad gave $477,800, either directly or through his foundation, to Democratic candidates and causes, according to the Center for Responsive Politics. Mr. Burkle has long championed labor unions. President Bill Clinton served as an adviser to Mr. Burkle’s money management firm, Yucaipa Companies, which in 2012 gave $107,500 to Democrats and related causes. The group also includes Austin Beutner, a Democratic candidate for mayor of Los Angeles, and an investment banker who co-founded Evercore Partners.

“This will be a bipartisan group,” Mr. Beutner said. “It’s not about ideology, it’s about a civic interest.” (The Los Angeles consortium is expected to also include Andrew Cherng, founder of the Panda Express Chinese restaurant chain and a Republican.)

“It’s a frightening scenario when a free press is actually a bought and paid-for press and it can happen on both sides,” said Ellen Miller, executive director of the Sunlight Foundation, a nonpartisan watchdog group.

Last month, shortly after L.A. Weekly first reported on Koch Industries’ interest in the Tribune papers, the liberal Web site Daily Kos and Courage Campaign, a Los Angeles-based liberal advocacy group, collected thousands of signatures protesting such a deal. Conservatives, meanwhile, welcomed the idea of a handful of prominent papers spreading the ideas of economic “freedom” from taxes and regulation that the Kochs have championed.

Seton Motley, president of Less Government, an organization devoted to shrinking the role of the government, said the 2012 presidential election reinforced the view that conservatives needed a broader media presence.

“A running joke among conservatives as we watched the G.O.P. establishment spend $500 million on ineffectual TV ads is ‘Why don’t you just buy NBC?’ ” Mr. Motley said. “It’s good the Kochs are talking about fighting fire with a little fire.”

Koch Industries has for years felt the mainstream media unfairly covered the company and its founding family because of its political beliefs. KochFacts.com, a Web site run by the company, disputes perceived press inaccuracies. The site, which asserts liberal bias in the news media, has published private e-mail conversations between company press officers and journalists, including the Politico reporter Kenneth P. Vogel and editors at The New Yorker in response to an article about the Kochs by Jane Mayer.

“So far, they haven’t seemed to be particularly enthusiastic about the role of the free press,” Ms. Mayer said in an e-mail, “but hopefully, if they become newspaper publishers, they’ll embrace it with a bit more enthusiasm.”

A Democratic political operative who spoke on the condition of anonymity, said he admired how over decades the brothers have assembled a complex political infrastructure that supports their agenda. A media company seems like a logical next step.

This person said, “If they get some bad press that Darth Vader is buying Tribune, they don’t care.”

Michael J. de la Merced contributed reporting.
https://www.nytimes.com/2013/04/21/b...ewspapers.html





Newspaper Reporter is ‘Worst Job’ in 2013, Study Says
Caitlin Johnston

Newspaper reporters can add CareerCast.com to the list of sources telling them to flee journalism.

The group took 200 jobs and ranked them in order from most to least desirable, based on factors such as environment, income, outcome and stress. Add all that together and newspaper reporter rings in at a dismal 200 out of 200 – the worst job on CareerCast’s list, below lumberjack, janitor, garbage collector and bus driver.

“We look at a wide range of criteria, as analytical as we can be,” said Tony Lee, CareerCast’s publisher. “There are some subjective pieces but, frankly, it’s really driven by the data.”

The data come from sources such as the Bureau of Labor Statistics, the Occupational Safety & Health Administration and trade associations.

2013 marks the 25th anniversary of the list. And while “newspaper reporter” has dropped down the ranks through the years, Lee said it’s been in the bottom half since the list’s inception.

“There are reasons why newspaper reporter is at the bottom,” Lee said. “Some of them are reasons that really haven’t changed in 25 years and some of them are new phenomena.”

Lee walked me through reasons old and new:

Reasons newspaper reporter was always a bad job

Pay: “It’s never paid terribly well compared to lots of other jobs.”

Stress: “It’s always been a relatively high-stress job. You’re working under deadline, which immediately makes it more stressful. You’re essentially in the public eye because others can read your work and take issue with what you write.”

Hours: “You’re essentially in demand all the time. Clearly there are times when you’re off, but if something happens on your beat or you’re in a small town, you need to drop what you’re doing and go to work.”

Reasons newspaper reporter is a worse job than it used to be

Fewer openings: “This is the first year of a negative hiring outlook. Between now and 2020, [the industry is] expected to contract. We have had, if you look back over the last year, more contraction in the newspaper industry. It’s been ramping up with more layoffs and more cutbacks.”

More demands: “The work environment has actually continued to worsen because newspaper reporters before, you were responsible for writing your article and having it in on deadline for printing the next day. But now, you’re also responsible for tweeting all day, perhaps writing a blog, perhaps taking video when you go to that school-board meeting. You’re responsible for doing more in the same amount of time. So the job has become significantly more demanding.”

Uncertainty: “Add on top of that the stress of the uncertainty of your employer. If you work for the Tribune Company right now, you don’t know what’s going to happen next. It’s clear you’re going to be sold. It’s unclear to who and what their plans will be.”

Last year, “newspaper reporter” didn’t do quite so badly on CareerCast’s list — it beat out oil-rig worker, enlisted military soldier, dairy farmer and lumberjack.

Allyson Bird, the young ex-journalist whose blog post on why she left the industry went viral last month, might agree with the ranking. But other journalists took issue with her position, and have now taken to Twitter to vent their frustrations over this latest perceived slight.
http://www.poynter.org/latest-news/m...s/#more-211353
















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